CGST Delhi South arrests firm partner over alleged ₹15.78 crore fraudulent ITC

NEW DELHI: The Anti-Evasion Branch of the Central Goods & Services Tax (CGST), Delhi South Commissionerate, has arrested a partner of an iron and steel trading firm in connection with an alleged fraudulent Input Tax Credit (ITC) claim involving more than ₹15.78 crore.

According to the CGST department, the alleged fraud involved bogus invoices amounting to approximately ₹87.67 crore. The department said the firm had allegedly availed, utilised and passed on inadmissible ITC without corresponding movement or receipt of goods.

The investigation found that the firm had availed ITC on the basis of invoices issued by multiple suppliers. Several of these firms were allegedly found to be non-existent, non-functional, suspended or cancelled.

Field verification by CGST officers also found that certain suppliers had no genuine business activity at their declared places of business, the department said.

Goods allegedly never received

Further investigation established that the firm had allegedly claimed ITC without actually receiving the goods covered by the invoices.

The department also alleged that the firm subsequently passed on the inadmissible ITC to various recipients through invoices issued without corresponding supply of goods.

The case has been investigated under the provisions of the Central Goods & Services Tax Act, 2017.

The partner was arrested on September 14 under Section 69 of the CGST Act, based on evidence gathered during the investigation and statements recorded under Section 70 of the Act.

He was subsequently produced before the Patiala House Court, which remanded him to judicial custody for 14 days.

The CGST department said further investigation in the case is underway.