World MSME Forum urges PM for CBI probe in fake billing scams

The World MSME Forum has written to the Prime Minister, seeking a CBI inquiry into bogus billing scams in the country, maintaining that without the connivance of GST officials these scams and frauds were not possible. President of the World MSME Forum, Badish Jindal, said if scams, worth Rs 20 lakh crore occurring annually in the country, were to be stopped it was crucial to have them investigated by the CBI.

He wrote that it was also crucial to investigate the officials who protected these fraudsters. Jindal pointed out that a large number of GST officials in the country lived in palatial houses, while their children studied abroad. Many officers had either settled abroad after retirement or were running large corporate companies. “We request the PM to order the CBI to investigate these bogus companies and the role of officers that facilitate these companies in opening these and supporting criminals in passing (sending material from one place to another without invoice),” said Jindal.

Data collected by the forum, from various platforms, suggests that in the last four years, the GST numbers of 62.58 lakh companies were closed and only 91,370 were investigated. In his letter to the PM, the forum president said that 1,234 scammers were arrested, but later the officials gave them a clean chit. The total GST scam in India was more than 14,000 trillion but the department just investigated 7.08 lakh crore which was merely 0.5 per cent of the total. Jindal also maintained that a GST scam worth Rs 20 lakh crore occurred every year in India. Such a huge scam could not happen without the tacit consent of the department. The government suffers a loss of Rs 4 lakh crore in GST revenue annually, he added.

“These scams represent approximately 5 per cent of the country’s GDP. The impact on the country’s total revenue is 9 per cent. Due to this, black money increases by 5 lakh crore every year. Central Goods and Services Tax have detected tax evasion of about Rs 7.08 lakh crore in the last five years, till 2024-25, including input tax credit (ITC) fraud of about Rs 1.79 lakh crore. In 2024-25 fiscal alone, more than Rs 2.23 lakh crore of GST evasion were detected by CGST field officers and in the 2023-24, Rs 2.30 lakh crore worth GST evasion was detected by CGST field officers. The signs of scams happening in the country can be seen from the registrations which have been cancelled by the departments. 62.58 lakh registrations have been cancelled in the last four years, but during this period GST registrations have increased from 1.16 crore to 1.32 crore. Thus, in these four years, 62.58 lakh registrations have been cancelled and 78.35 lakh new GST numbers have been issued. Most of these cancelled numbers were of companies involved in fake billing and most of the new GST registrations have also been done by these companies under new names,” said Jindal. He urged the PM to look into the losses incurred by the country and punish the culprits.