Fake invoices: 29,000-plus firms busted since May 2023

29,000 bogus firms busted for GST evasion, leading to 121 arrests and saving ₹4,646 crore.

Over 29,000 bogus firms, involved in evading Goods and Services Tax (GST) dues of more than ₹44,000 crore, have been busted over the past seven months, leading to 121 arrests, the Finance Ministry said on January 7.

This is a result of a special drive against fake invoices supplied by non-existent firms, being carried out by the Central Board of Indirect Taxes and Customs with State governments. Fake invoices are used by firms to avail input tax credit (ITC) without any underlying supply of goods and services taking place.

“Since the initiation of the special drive against fake registrations in mid-May 2023, a total of 29,273 bogus firms involved in suspected Input Tax Credit (ITC) evasion of ₹44,015 crore have been detected. This has saved ₹4,646 crore of which ₹3,802 crore is by blocking of ITC and ₹844 crore is by way of recovery,” the Ministry said.

In the October to December 2023 quarter, 4,153 firms were detected which were involved in suspected ITC evasion of around ₹12,000 crore. “This has protected revenue of ₹1,317 crore of which ₹319 crore has been realised and ₹997 crore has been protected by blocking ITC. Forty-one persons were arrested in these cases,” the Ministry said.

To strengthen the GST registration process, several measures have been taken, including the launch of pilot projects of biometric-based Aadhaar authentication in Gujarat, Puducherry and Andhra Pradesh.