Cyber Crime
Tax Authorities Uncover Massive GST Fraud Worth Rs 25,000 Crore
In a sweeping nationwide investigation, Indian tax enforcement officials have identified approximately 18,000 fictitious companies that orchestrated a Goods and Services Tax (GST) evasion scheme amounting to Rs 25,000 crore, according to senior officials.
The revelation emerged from a comprehensive anti-fraud operation where authorities initially flagged 73,000 suspicious GST Identification Numbers (GSTINs) for detailed scrutiny. These companies were suspected of being shell entities created solely to exploit input tax credit (ITC) benefits without conducting legitimate business transactions.
“Our verification process of the 73,000 flagged GSTINs revealed that roughly 18,000 companies were completely nonexistent, collectively responsible for tax evasion totaling approximately Rs 24,550 crore,” a senior tax official disclosed to PTI. During this enforcement drive, some companies voluntarily remitted GST payments amounting to Rs 70 crore.
The government has intensified its compliance measures, implementing more rigorous physical verification protocols to combat fraudulent GST registrations. This recent operation, which ran from August 16 through October’s end, marked the second nationwide anti-fraud initiative.
The preceding enforcement campaign, conducted between May 16 and July 15, 2023, had successfully exposed 21,791 fake GST-registered entities, uncovering suspected tax evasion of Rs 24,010 crore.
This heightened scrutiny reflects the tax authorities’ commitment to curbing GST fraud and ensuring compliance within the national tax framework. The detection of these phantom companies highlights the sophisticated nature of tax evasion schemes and the authorities’ expanding capabilities in countering such fraudulent activities.
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