Central, state GST officers detect 25,009 faux companies fraudulently passing ₹61,545 crore ITC in FY25

Central and state GST officers have detected 25,009 faux companies concerned in fraudulently passing enter tax credit score (ITC) price ₹61,545 crore throughout 2024-25, officers mentioned.

Through the 2024-25 fiscal ending March 2025, Central and state GST officers recovered ₹1,924 crore by the use of blocking ITC and arrested 168 individuals.

As per knowledge on ITC frauds unearthed by Central and State GST officers, over the 2 years 2023-24 and 2024-25, 42,140 faux companies have been detected, which have been concerned in fraudulently producing ITC of over ₹1.01 lakh crore. ₹3,107 crore was recovered by the use of blocking of ITC, and 316 arrests have been made.

“The Central and State Governments and GSTN have taken numerous steps to forestall faux ITC claims, together with offering intelligence inputs, detecting fraudulent registration, and suspicious e-way invoice exercise,” an official instructed PTI.

Underneath the Items and Companies Tax (GST) regime, ITC refers back to the taxes paid by companies on purchases from suppliers. This tax could be claimed as a credit score or deduction on the time of paying the ultimate output tax.

Coping with faux ITC has been a serious problem for the GST administration as unscrupulous parts have been creating faux companies simply to assert ITC and defraud the exchequer.

To cope with this, the GST registration course of has been made stringent with checks on dangerous candidates.

Whereas non-risky companies are to be granted GST registration inside 7 days, bodily verification and Aadhaar authentication are obligatory for these granting registration to these candidates who’re flagged as dangerous by knowledge analytics.

As a measure to trace down the masterminds, the GST Act supplies for punishment for wrongly availed ITC, suspension or cancellation of registration of taxpayers concerned in faux ITC instances; blocking of ITC in digital credit score ledger; and provisional attachment of property/financial institution accounts, and so on. for the restoration of presidency dues.

To date, two nationwide conferences of enforcement chiefs of State and Central GST Formations have been held with respect to actions being undertaken by the enforcement formations and the significance of sustaining ease of doing enterprise.