ED Conducts Raids and Seizes Rs 29 Lakh in Cash in Case Against Gujarat Company for GST Evasion

The Enforcement Directorate (ED), which recently conducted searches in many cities in a money laundering case connected to suspected GST evasion of Rs 122 crore by a Gujarat business, claimed on Monday that it has confiscated Rs 29 lakh in cash.

In a case involving Mohammad Ejaj Bomar and others, searches were started on June 2 at 25 sites in Ahmedabad, Bhavnagar, Botad, Gandhidham in Gujarat, as well as Mumbai and Bengaluru.

The locations of the accused, who were “involved” in creating fictitious paperwork used to create phoney GST (Goods and Services Tax) corporations, as well as the organisations used to provide fictitious Input Tax Credit (ITC), were covered, according to a statement.

The ED case was brought under the Prevention of Money Laundering Act (PMLA) and is related to a FIR from the Gujarati city of Bhavnagar police.

The accused allegedly changed the mobile numbers associated with several people’s Aadhaar cards while promising them financial assistance through government programmes, the ED claimed in a charge sheet filed by the police in this case. The accused then allegedly used these Aadhaar details to obtain PANs before registering for GST.

The charge sheet said that “fake invoices of more than Rs 1,102 crore, involving GST evasion of Rs 122 crore and using 461 bogus firms, were issued,” according to the ED.

The suspects were “creating fake entities through forged documents to obtain GST registration,” according to the modus operandi of this crime. Later, by creating fictitious invoices on a commission basis, these bogus firms transferred ITC to beneficiaries.

According to the statement, “Payment for these fake invoices was made through banking channels, and the operator of the fake entity and the beneficiary later settled the amount in cash.”

The searches resulted in the seizure of “incriminating documents” such as paperwork for transferring mobile numbers from Aadhaar cards, phoney invoices issued by these fictitious firms, digital proof, and Rs 29 lakh in cash, it added.