In a major crackdown on tax evasion, the anti-evasion team of the Thane Central Excise & CGST Commissionerate Mumbai Zone has uncovered a fake Input Tax Credit (ITC) racket involving a staggering Rs 48 crore. The mastermind behind this elaborate scam, Hitesh Shantilal Vasa, was arrested on Thursday, authorities confirmed.
Vasa is accused of creating and registering 22 shell companies by misusing KYC documents such as Aadhaar cards, PAN cards, and other identification details from his relatives and acquaintances. Using these companies, Vasa was able to claim and retain fraudulent Input Tax Credit benefits, amounting to Rs 48 crore, by facilitating dummy transactions and proxy dealings with non-existent firms.
The scam involved the creation of fictitious business entities that were used to inflate turnover through circular trading. These companies claimed to engage in the purchase and sale of goods and services, without any actual movement of goods. By doing so, Vasa was able to pass on an illegitimate Input Tax Credit of Rs 44 crore to other companies, further perpetuating the fraud.
In addition, Vasa misused the KYC documents to obtain GST registrations for these fake entities, which were registered under false names as proprietors, partners, or directors. He also used these documents to open bank accounts under the names of the fake companies or individuals, facilitating the laundering of fraudulent claims.
Vasa has been arrested under Section 69 of the CGST Act, 2017 for his role in violating Section 132 of the Act. The charges include fraudulent claims of ITC and misuse of GST registrations. Following his arrest, Vasa was presented before the Chief Judicial Magistrate and has been sent to 14-day judicial custody.
The arrest follows a thorough investigation by the anti-tax fraud team, which identified the scale and sophistication of the scam. Investigators have seized documents and electronic evidence linking Vasa to the illegal activities.
The Rs 48 crore GST fraud is part of a growing trend of fraudulent schemes aimed at exploiting India’s GST system. This case underscores the importance of stringent due diligence in verifying the legitimacy of companies and their tax filings. Authorities are expected to continue their investigation to uncover the full extent of the network involved in this tax evasion racket.
