GST scam busted in Diamond City: Transaction worth Rs 125 crore in the name of scrap business, Sheikh Yusuf arrested from luxurious flat; 14 Days of Judicial Custody

A team of the country's top agency DGGI, which monitors economic crimes, has busted a multi-crore GST scam in Surat. The main accused, Sheikh Yusuf Abdul Ghafoor, has been arrested for cheating the government of Rs 19 crore of bogus input tax credit (ITC) by making a huge transaction of Rs 125 crore in the name of scrap business. The accused, who lives in a luxurious flat worth crores of rupees on Gorat Road, was produced before the court late in the evening and was ordered to be sent to judicial custody for 14 days. Claim of ITC of Rs 19 crore through bogus billing The entire racket was busted on the basis of specific intelligence received by DGGI. The arrested accused, Sheikh Yusuf Abdul Ghafoor (R/o B-402, Exclusive, Gorat Road), was earlier running a small scrap business in Turawa Mohalla. However, he soon began to play the 'big game'. According to police sources, the accused first took the case to M.S. He opened a firm in the name of scrap and then started a business in the name of New Nalbandh Trading. These firms were used only for bogus billing without actual movement of goods. On the basis of this fake billing, the accused claimed a total input tax credit of Rs 19 crore from the government and illegally siphoned it off. A total of suspicious transactions of Rs 125 crore have been found in his bank accounts and books of the firm. The DGGI received information that the accused had earned crores of rupees through these bogus transactions, on the basis of which action was taken to arrest him. Did the money of the scam stay in the land and building? The biggest and shocking aspect of the entire case is related to the luxurious lifestyle of the accused and the expensive properties on Gorat Road. DGGI has been investigating the GST scam, but it is imperative that the Income Tax Department investigates where the illegal money that these scammers have received and stopped. The Department has already received inputs that crores of rupees earned by fraudsters by way of availing ITC have been invested mostly in the purchase of land and buildings. The Gorat Road area, where arrested accused Sheikh Yusuf lives in a flat worth crores, is suspected to have become a hub of bogus billing scams. According to sources, more than 100 flats of such bogus billing scammers can be found on Gorat Road alone. At present, the price of each flat in the area is around Rs 2 crore to Rs 2.5 crore. These figures clearly indicate that huge amounts of tax evasion money have been invested in unaccounted properties. 14 Days of Judicial Custody The DGGI team arrested the accused Sheikh Yusuf Abdul Ghafoor and produced him before the court. Considering the seriousness of the economic offence and the need for further investigation, the court ordered the accused to be sent to judicial custody for 14 days. After these arrests, the Income Tax Department is also likely to be proactive and conduct an exercise to search the properties of all these fraudsters and seize the unaccounted assets, which could be a major blow to the parallel economy dependent on tax evasion money.