GST fraud: Drive launched to identify fake firms in Faridabad

Faridabad, May 23

To identify fake firms under the GST regime and nab offenders, state and central GST cells of the Taxation Department have launched a drive for physical verification of such units/establishments in the district. Reportedly, 400 such units are under the scanner in the district.

For better policy formulation

The verification was part of the drive to provide intelligence inputs and carry out big data analytics to assist tax officers for better policy formulation and nabbing evaders. Dr Saurabh, deputy commissioner, central gst

The drive would include inspection of record of transactions done in the past one year or more to ensure that there is no irregularity in the process, revealed sources in the Taxation Department. While the drive will focus on companies whose details have been supplied by the Centre, the scope of verification could extend further, said an official on the condition of anonymity.

The drive, which would continue until mid-July, is likely to curb any malpractice on account of GST registration or tax evasion. Of the total 77,641 units registered in the district, those falling under the state and Central GST are 42,592 and 35,049, respectively. As the registration is done online, it takes 7-30 days for registration.

However, according to sources many of the units do not have a proper address or record of the financial transactions and likely evade tax despite being registered for GST. Despite action against some companies in the past few years, such violations continue.

A scam of Rs 25.11 crore had surfaced in Palwal district in April last year after the Taxation Department found bungling in submission of the tax returns by a private company. The fraud surfaced after a firm involved in the trade of cigarettes and bidis had applied for registration cancellation on April 1, 2015. Fraudulent interstate transactions were detected in the probe.