Five people have been arrested in Indore, Madhya Pradesh for allegedly operating 550 dummy companies from a room in Surat, Gujarat, to commit revenue fraud under the GST system worth several crores of rupees, officials said on Monday.
Central Goods and Services Tax Commissionerate officials detained the five from Surat on May 25 with the help of the Madhya Pradesh Cyber Cell, an official said.
“The five had shown business dealings worth Rs 800 crore through 550 dummy companies, which all existed only on paper so that they could fraudulently claim ITC of Rs 100 crore, which they then sold to other companies for commission,” he stated.
Approximately four to five tables and chairs were available in the Surat room where these 550 firms operated, which could accommodate six people at a time. It was believed that the accused used illegally obtained identity documents from Gujarat, Maharashtra and Madhya Pradesh to register these firms with the Goods and Services Tax network.
He said the accused used the names of daily wagers and a retired MP director general of police to create dummy companies, and that one of those people died seven years ago.
A number of incriminating documents, mobile phones, SIM cards, seals, letter pads, etc. have been seized from the accused, and the probe will intensify as more evidence is uncovered, the official said. PTI HWP MAS BNM BNM