Fake GST invoice network busted

Visakhapatnam: Officers of the anti-evasion wing of Vizag Central GST have detected a fake invoice racket involving a network of companies.

Enquiries made and searches conducted on Krishna Sai Constructions Pvt. Limited and Dew Drops Granite Private Limited revealed that fake GST credit worth more than Rs 18 crore was transacted by creating fictitious invoices without actual supply of goods or services.

Three persons, including the alleged mastermind, Madan Mohan Reddy, were arrested and produced before the Economic Offenses Court in Visakhapatnam on Wednesday. The magistrate ordered for judicial custody for 14 days and sent for remand and the accused were sent to Central Prison, Visakhapatnam.

Further investigation in the case is on and the officers are looking at the possibility of several Andhra Pradesh and Telangana-based fake firms in the network and the quantum of fraudulent tax amount is likely to go up.

The officials explained that shell companies were being floated without any real business or supplies and creating fake GST invoices. Through these, fraudulent tax credit is passed on and utilised by other entities leading to evasion and huge revenue loss to the government.

They added that the department is using data analysis to detect these fake networks and as per law, the persons involved can be arrested if the amount exceeds a stipulated limit.