In a major operation against the tax evaders, Punjab Taxation Department’s GST wing on Monday arrested four persons for GST fraud of Rs 48 crore from Jalandhar.

The suspects were allegedly running fake firms related to iron scrap and had obtained GST registrations only to claim Input Tax Credit (ITC) fraudulently by issuing only invoices without the supply of actual goods.

Department’s official spokesperson said that Pankaj Kumar alias Pankaj Anand for allegedly running firms named M/s PK Trading Co. M/s Gagan Trading Co., M/s Krrish Trading Co., M/s Balaji Trading Co., M/s Krrish Enterprises and M/s Pankaj Scrap Company, Ravinder Singh for allegedly running M/s Guru HarRai Trading Co., Gurvinder Singh for allegedly running M/s Shiv Shakti Enterprises, and Amirtpal Singh for allegedly running M/s North Vogue were arrested and were produced before the magistrate and sent to judicial custody. All the four accused are the residents of Jalandhar, added the spokesperson.

Spokesperson said that an initial investigation was conducted by the authorities on M/s PV Interior Decor, Jalandhar, which further led to the investigation of M/s Dasmesh Trading Co., Jalandhar, M/s Gur Har Rai Trading Co., Jalandhar, Krrish Trading Co., Jalandhar, M/s Shiv Shakti Enterprise, Jalandhar, M/s Balaji Trading Co., M/s Pankaj Scrap Co., Jalandhar, Gagan Trading Co. and M/s North Vogue Co., Jalandhar. “All these firms were involved in a nexus of fake non-functioning firms, which availed, utilized and passed the fraudulent ITC to actual beneficiaries”, he added.

These persons were only showing circular trading of iron and plastic scrap and in lieu of that they were issuing fake invoices and generating fake e-way bills on scooters, motorcycles, cars, vans, tractors and on fake vehicles having no records, said the spokesperson. By creating bogus ITC, these persons were passing on the same bogus ITC to the other than end taxpayers who adjusted their tax payment liabilities with this bogus ITC rather than paying the same from their own and thus defrauding the state exchequer.

Spokesperson said that this operation was held under the directions of the state Finance Commissioner (Taxation) Vikas Partap and Taxation Commissioner Kamal Kishor Yadav, and was supervised by the Additional Commissioner State Tax (Audit) Ravneet Khurana, and the Additional Commissioner State Tax-1 (Investigation) Viraj S Tidke.