Surat and Ahmedabad becoming fake GST billing center: Govt

Surat and Ahmedabad becoming fake GST billing center: Govt

After the execution of GST, Surat and Ahmedabad has become the center for fake billing in Gujarat state.

While the trap of illegal transactions has spread too fast, industrializing districts like Bhavnagar, Rajkot, Morbi, and Gandhinagar, where many business and trading companies have been involved in the rackets.

Both Surat and Ahmedabad districts account for almost 58 percent of the Rs 3,094 crores worth of taxes involved in fake billing rackets in the last three year, ends 30th June 2021.

State government notified in a written reply to a question asked by Niranjan Patel, Congress MLA from Petlad, about fake billing in
GST during the recently ended monsoon session of Assembly in Gujarat.

While Ahmedabad reports the highest Rs 971 crore of tax in tax billing, it was Rs 789 crore in Surat city. Both Ahmedabad and Surat saw the involvement of 250 and 196 firms each, respectively. GST came into effect in 2017. While this fake billing racket is being reports from 18 out of 33 districts of Gujarat, smaller industrial clusters like Gandhinagar, Rajkot, Morbi, and Bhavnagar are also saying the involvement of a large number of companies in producing fake bills.

Bhavnagar has the third-highest quantum of tax Rs 433 crore involving, where a total of 104 trading units are under scanner.

Though the government, in its written reply, notified that no government officials had been found involved in the bogus billing cases till 30th June 2021, the situation will be changed in the upcoming months.

Surat and Ahmedabad becoming fake GST billing center Govt 1pixabay image

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Bhavnagar is the only place in Gujarat where the state government stepped in and transferred 36 officials from one office of the SGST department in link with a Rs 1,000 crore fake billing case pulled out in July 2021.

Two of the SGST officials, including a deputy commissioner, were also suspended for their alleged involvement in the case. This is, however, the first time the participation of government officials has come to light.

The data listed in the Gujarat Assembly also states that 1,037 business and trading firms were involved in generating fake bills.

And smaller industrial locations like Gandhinagar Rs 104 crore, Morbi Rs 126 crore, and Rajkot Rs 333 crore emerged as centers for generating fake GST bills.

SGST officials in Gujarat The Sunday Express said that the bogus billing racket in the state involves a complex network of individuals who illegally use these fake bills to claim Input Tax Credit.

SGST official said

“This web of individual could comprise of as many as 50 persons and are harshly categorised by us as initiator system, pass-on entities and beneficiaries depending on the role they play while implementing the fraud,”

SGST officials said bogus billing rackets in Gujarat operate out of rented premises and have been operating from premises belonging to some associate remotely connected with the conspirator.

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