Madhya Pradesh tax sleuths unearth Rs 1,150 cr fake businesses

Indore: Madhya Pradesh governments Commercial Tax Department has detected 285 firms involved in fake businesses of Rs 1,150 crore.

Under a drive from July 29-31, the spot verification of 680 business firms was carried out. Of these, 285 business firms registered under the GST were found to be bogus," Commercial Tax Departments joint commissioner Sudeep Gupta told on Thursday.

This means, no business activities were found on the addresses, which they mentioned in the Goods and Service Tax registration.


Gupta said the detailed investigation of these firms discovered a fake business of Rs 1,150 crore, which was carried only on paper and by issuing the forged bills in a bid to take benefits of GST's input tax credit.

"At first glance, the estimated tax evasion of around Rs 183-crore was found. However, we are still in the process of confirming these facts," he said.

Gupta said that the process for the cancellation of GST registration of these bogus firms has been initiated.

The joint commissioner said that detailed analysis has also revealed many "dummy" business firms in the state.

These firms were registered in the GST system using the identity and address of other persons rather than their actual owners, so that they can take advantage of GST's input tax credits through fraudulent means.