L&T faces the heat from GST department for involvement in fake invoicing

L&T faces the heat from GST department for involvement in fake invoicing

Engineering and construction major Larsen & Toubro (L&T) had been fined a whopping Rs. 30 crore for being allegedly involved in a fake invoicing case. L&T will be depositing the fine with the GST department.

After the GST department launched a crackdown against fake invoicing frauds and GST evasion since November 2020, it has made 329 arrests that include 113 Proprietors, 46 Director/Managing Directors, 17 Partners, 5 CEOs/CFOs/CMDs, 10 Chartered Accountants, 4 Accountants and one each of Company Secretary, broker, and GST practitioner.

The department has also filed more than 3,200 cases against 9,600 fake GSTIN entities and have recovered more than Rs. 1,000 crore from the fraudsters.

Arrested persons also include fake entities operators and the end beneficiaries who connive with these fraudsters running businesses of fake invoices.

With the use of deep data analytics, integrated data-sharing and AI & ML tools along with Business Intelligence and Fraud Analytics (BIFA) the GST department has unearthed the input tax credit (ITC) utilisation frauds via fake invoicing and bogus firms.

The technology has enabled the GST ecosystem and intelligence authorities to identify layer-by-layer activities of these fake entities and their networking without any overreach and pinpoint fraudsters with specific inputs to take targeted actions and further investigations against them.

In January, the premises of L&T, Zee Entertainment and some other Mumbai-based companies were raided by the I-T and GST departments after they were found availing Input Tax Credit based on alleged fake invoices.

According to the revenue department sources, the nationwide drive against fake GST invoice frauds have yielded record GST collections for over three months and has fetched record collections of Rs 1.15 lakh crore in December, 2020, and Rs 1.20 lakh crore in January, 2021.