Rs 127 Cr GST Fraud Unearthed In Mumbai, Two Accused Sent To 15 Days Judicial Custody

The Logical Indian Crew Maharashtra

May 23rd, 2018 / 6:24 PM

Image Credit: Arun Jaitley, Live Law

On May 19, Amit Upadhyay, 40, and Asad Anwar Sayed, 42, were sent to judicial custody for 15 days by a local court in Mumbai. Upadhyay and Sayed had allegedly conspired to give effect to a Rs 127 crore tax fraud. The Directorate General of Goods and Services Tax Intelligence (DGGSTI) is estimating this fraud to be over Rs 300 crore, and, reportedly, has decided to contest the bail applications of the two accused.

It seems the duo had, allegedly, duped the government by wrongfully claiming GST credit of Rs 80 crores for non-existent services. Upadhyay’s company, Horizon Outsource Solutions Private Ltd, showed fake invoices raised by Sayed’s company, Best Computer Solutions Private Ltd, and then claimed GST credit for the non-existent services received. This also resulted in artificially boosting Horizon’s turnover, Rs 400 crore for FY 2016-17, enabling Upadhyay to leverage more funding.

As per reports, it also came to light that Horizon collected Rs 47 crore service tax in the period, April 2016 – June 2017, but did not deposit the money with the government.

As reported by the Hindu, sources in DGGSTI said, “Once the investigations are complete, we expect the total evasion to reach ₹300 crore and more. We don’t expect them to go scot-free since it is a one-of-its-kind case. The invoices were not only generated on services never provided, but they were even printed.”

They have been charged under section 132(1) of CGST act for supply of goods or services without issue of invoices, issue of invoice without supply of goods, availing input tax using bogus invoice, and collection of tax but failure to pay the government beyond three months from the date on which such payment becomes due.

Just in 2018, several GST fraud cases have come to light. Rs 50.34 crore fraud in Haryana, Rs 100 crore scam in Punjab, and a Rs 40 crore case in Kolkata. Reportedly, invoice matching mechanism is expected to be rolled out on July 1 which will curb the possible tax evasion on account of fake invoice frauds.


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