GST Crackdown: Unmasking the Fake ITC Empire

Central and state GST officers have uncovered 25,009 fake firms involved in a massive input tax credit (ITC) fraud worth Rs 61,545 crore during 2024-25. Measures such as intelligence sharing and stringent verification processes have led to the recovery of Rs 1,924 crore and the arrest of 168 individuals.

Central and state GST officers have revealed a significant input tax credit (ITC) fraud involving 25,009 fake firms, amounting to Rs 61,545 crore during the fiscal year 2024-25. In efforts to combat this illegal activity, authorities have recovered Rs 1,924 crore and arrested 168 people.

Data from Central and State GST officers show a total of 42,140 fake firms detected over 2023-24 and 2024-25, generating fraudulent ITC claims surpassing Rs 1.01 lakh crore. Enhanced registration procedures, including Aadhaar authentication and physical verification for risky applicants, are part of the measures to curb these scams.

The GST administration has intensified its crackdown on fake ITC claims through national conferences and strategic enforcement activities, aiming to balance stringent action with ease of business operations. The GST Act facilitates severe penalties, including suspension of registration and property attachments, to deter fraudulent practices.

(With inputs from agencies.)