The Directorate General of GST Intelligence (DGGI) and the Directorate General of Revenue Intelligence (DRI) carried out pan-India searches at 336 locations against exporters fraudulently claiming refund of IGST.
This was the biggest-ever joint operation by the two premier intelligence agencies of the Central Board of Indirect Taxes and Customs (CBIC), officials said.
The operation, involving about 1,200 officers from both the agencies, covered entities in Delhi, Haryana, Uttar Pradesh, Gujarat, Maharashtra, Tamil Nadu, West Bengal, Karnataka, Madhya Pradesh, Telangana, Punjab, Rajasthan, Himachal Pradesh, Uttarakhand and Chhattisgarh, they said.
On specific intelligence that some exporters were exporting goods on payment of tax (IGST), being done almost entirely out of the Input Tax Credit (ITC) availed on the basis of ineligible/fake supplies. Further, such IGST payment was claimed as refund on export, the officials said.
Based on the data provided by the Directorate General of Analytics and Risk Management (DGARM), analysis was conducted wherein certain ‘red flag’ indicator filters were applied to Customs’ export data in conjunction with the corresponding GST data of the exporters, they said.
It was noticed that there was no or negligible payment of tax through cash by the exporters as well as their suppliers. In a few cases, even the tax paid through ITC was more than the ITC availed by these firms, the officials said.
On the basis of the intelligence, massive searches were conducted on the premises of exporters and their suppliers, they said.
The day-long operation revealed that many of the entities spread across the length and breadth of the country were either non-existent or had given fictitious addresses, the officials said.
A preliminary examination of the records and documents along with the statements of various persons indicated that an ITC of more than Rs 470 crore (Invoice value of approximately Rs 3,500 crore) is bogus/fake which has been further utilised by the exporters for effecting exports on payment of IGST through ITC and claiming consequential cash refund of the same, they said.
Besides, an IGST refund amount of around Rs 450 crore is under examination, they said.
Further, some live export consignments of these exporters have been intercepted at Vadodara Rail Container Terminal, Mundra port and Nhava Sheva port for examination in order to ascertain misdeclaration, the officials added.