GST officers have detected ₹824 crore tax evasion by 15 insurance companies, intermediaries and banks through issuance of fake invoices, officials said on Thursday.
Acting on specific inputs, GST Intelligence Officers in Mumbai searched the premises of a number of corporates — insurance companies, intermediary marketing/branding companies, NBFCs and banks, in multiple cities.
During the search investigations, many cases of availment and utilisation of ineligible input tax credit (ITC) without underlying supply of goods or services were detected, officials said.
As many as 15 insurance companies, intermediaries, marketing companies, NBFCs and banks were allegedly following this modus operandi and evading GST.
The investigations revealed that these entities had formed an arrangement to pass on ineligible ITC in the guise of marketing services and fraudulent invoices were raised in connivance with each other, officials said.
Investigation points to systematically planning and executing the modus operandi mainly at the behest of insurance companies, they added.
Statements of key persons involved indicate that the insurance companies have been executing the modus since the inception of GST.
So far, GST evasion to the tune of ₹824 crore has been unearthed. Various insurance companies which have availed and utilised the ineligible ITC have voluntarily paid a total amount of ₹217 crore in cash, officials said, adding further investigations are in progress.