Raipur: The Chhattisgarh State Goods and Services Tax (CG SGST) department has uncovered a major tax evasion racket involving more than 170 bogus firms, a government official announced on Friday. The scheme, allegedly masterminded by Mohammad Farhan Sorathia, a GST tax consultant, caused the state exchequer losses running into several crore rupees every month through the generation of fake registrations, bills, and e-way bills.
“Preliminary investigation suggests that just 26 of these fake firms generated e-way bills worth Rs 822 crore while reporting a turnover of only Rs 106 crore. Authorities estimate a preliminary GST revenue loss of around Rs 100 crore from these firms alone,” the government statement said.
The syndicate was engaged in creating bogus firms and fake bills using the GST prime portal. The CG SGST’s Business Intelligence Unit (BIU) has been investigating the case for over a month.
On September 12, a search was conducted at Sorathia’s office where authorities found evidence that 172 firms were allegedly floated using forged documents. It was revealed that Sorathia had employed five staff members to handle firm registrations, file returns, and generate e-way bills.
Investigators also uncovered fabricated rent agreements, consent letters, and affidavits used to secure bogus GST registrations. The fraudulent registrations were not limited to Chhattisgarh but extended to states including Punjab, Assam, Manipur, and Odisha.
Bogus documents such as lease agreements and consent letters were used to facilitate these fake registrations, with the firms issuing fraudulent supply bills and e-way bills.
As part of the ongoing probe, officials searched the residence of Sorathia’s uncle, Mohammad Abdul Latif Sorathia, on September 17. During the search, they seized Rs 1.64 crore in cash and four gold biscuits weighing 400 grams. These seized assets have been handed over to the Income Tax Department for further action.
The racket reportedly involved several brokers, scrap dealers, and companies who benefited from fraudulent Input Tax Credit claims. The CG SGST department has stated that a comprehensive investigation and further legal proceedings are underway.
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https://www.freepressjournal.in/business/gst-fraud-170-bogus-firms-dismantled-generated-822-crore-e-way-bills-reporting-turnover-of-only-106-crore
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