The State CT and GST’s enforcement squad raided the fly ash manufacturing unit and residence of proprietor of Maa Salara Fly Ash Bricks in Cuttack on Monday and detected a GST fraud involving claiming of erroneous refund of Rs 4.38 crore.
The refund has been claimed under inverted duty structure. It is claimed that huge amounts of Input Tax Credit(ITC) have remained unutilised as the main raw material i.e cement is taxable @28 per cent whereas the finished product i.e fly ash bricks is taxable @12%, a GST official said.
But, during verification, it was revealed that the taxpayer has shown fictitious purchases of cement from places like Keonjhar, Tirtol, Panikoili, Jagatsinghpur, Sukinda despite the fact that the manufacturing unit is located at Cuttack.
No proportionate quantities of bricks were also found to be manufactured in proportion to the consumption of cement, the official said.
During the raid, large numbers of incriminating documents, bill books of six different firms were seized for further investigation.
It is suspected that the mastermind has arranged fake purchase invoices without receipt of cement and utilised the ITC to discharge tax and claimed refund of balance ITC. He has not utilised any e-waybill for purchase of the goods, the official added.