GST scammers looted Indian government of Rs 15,000 crore

The scam has brought into focus the lax Know Your Customer (KYC) norms that have been put in place by the Ministry of Corporate Affairs

- ABHINANDAN MISHRA

In May last year, the Sector 20 police station in Gautam Buddha Nagar, Noida, Uttar Pradesh, registered a first information report, in what appeared to be a simple case of forgery, on a complaint filed by a digital platform anchor. It was alleged in the complaint that the Goods and Sales Tax (GST) accounts of two companies were registered in Punjab and Maharashtra on the Permanent Account Number (PAN) of the said individual. The catch was that the individual was a salaried employee and was not running any company for which he would have to register the details of it against his PAN. More shockingly, both these companies, registered on the PAN, were also authenticated for the Aadhar verification of the complainant, despite no mobile number or email being linked with the Aadhar of the complainant.

One year later, it has emerged that this incident, which initially appeared to be a simple case of forgery, is in fact a massive scam worth Rs 15,000 crore—an amount that has been allegedly siphoned off from the Government of India.
As per the investigations carried out by Deputy Commissioner of Police (Crime), Shakti Mohan Avasthy under the guidance of Commissioner of Police, Gautam Buddha Nagar, Laxmi Singh, two Haryana-based businessmen floated thousands of bogus companies using documents of individuals who had nothing to do with them. Using these companies and identity documents, the two ran a racket of 40-45 people who were claiming input-tax credit. The scam had been in operation since at least 2018.