In the first arrest under Goods and Services Tax (GST) Act, the Karnataka commercial tax department on Thursday held a trader for issuing bogus invoices worth nearly Rs 46 crore to evade GST of Rs 8 crore. The accused is a trader of ferrous and non-ferrous scrap in Bangalore.
The state tax department said the data analytics software, called GSTPro, caught the fraud. “This is first arrest by the commercial taxes department in Karnataka under the GST. Further leads are being investigated. Data-based intelligence has also demonstrated the importance in ensuring compliance,” the department said in a statement.
Tax officials inspected the business late last month and found that the trader had not received any goods or services but had claimed input tax credit (ITC) without any purchase. Further, the accused had issued fraudulent invoices for outward supplies to other businesses which facilitated claim of ITC.
“The trader was produced before the special court for economic offences and judicial magistrate has sent him to the judicial custody until September 20,” the department said.
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