The Directorate General of GST Intelligence (DGGI) Gurugram Zonal Unit (GZU), Haryana, has arrested a person on charges of passing and availment of fake ITC while operating dummy, fake and non-existent firms and encashing this unduly availed input tax credit (ITC) through IGST refund mode by showing export of cigarettes.
Ritesh Aggarwal is a resident of Bahadurgarh, Haryana.
It became apparent from the investigation that Aggarwal, the proprietor of M/s SR Impex was de-facto controller of another firm — M/s SR International. In the supply chain of these firm were found to be six other dummy firms by the names of M/s Joles Trading Co, AS Traders, AR Traders, Om Traders, Capital India & S.M enterprises — all controlled by Agarwal. In all these firms, Aggarwal had availed and passed on ITC of Rs 376 crore by means of billing without goods. Also, Aggarwal was sanctioned refund of Rs 37.13 crore from the department.
In addition, Aggarwal was found to be a habitual offender. In an earlier case also, Show Cause Notice for demanding of Rs 26.53 crore was issued to him for similar modus operandi of operating fake firm, M/s SS & Co. (GSTIN 06DJUPD5067G2ZW) and availing and passing on fake ITC.
Further, Aggarwal, who also adopts the alias of Ravi Gupta, was found to be accused in the Show Cause Notice dated 1st March 2019 issued by the DGRI wherein fraudulent drawback was availed on imported areca nuts by forging the Certificate of Origins.
The investigation spanned multiple locations in Delhi and Haryana and based on documentary evidence and statement recorded of many suppliers of these firms, it was ascertained that Aggarwal is a key person in orchestrating this racket of making fake/non-existent/dummy firms and wrongly availment and passing on on ITC of Rs 376 crore. Accordingly, Aggarwal was arrested yesterday and produced before Duty MM, Patiala House Court Delhi, who ordered judicial custody.
Further investigations in the matter is underway.