Raipur
The State GST Department has busted a major tax evasion racket involving over 170 bogus firms and a fraudulent GST network worth more than Rs 100 crore. The department has detained the alleged mastermind of the scam, Mohammad Farhan Sorathia, who posed as a GST consultant.
The department seized several documents from Sorathia and his associates. A search of Sorathia’s house yielded Rs 1.64 crore in cash and four gold biscuits weighing 400 grams. The seized items were handed over to the Income Tax Department.
The GST department’s BIU team had been monitoring the case for a month before raiding Sorathia’s office on 12 September. Officials found documents related to the registration of 172 firms and bogus billing. Sorathia had assigned five of his staff members the task of creating fake registrations, e-way bills, and filing GST returns. Documents such as rent agreements, consent letters, and affidavits for the firms were also found to be fraudulent.
According to initial estimates, the state lost over Rs 100 crore in GST revenue from just 26 of these firms. These firms generated e-way bills worth Rs 822 crore but showed a turnover of only Rs 106 crore in their returns. The documents also revealed that fraudulent registrations were made not only in Chhattisgarh but also in Punjab, Assam, Manipur, and Odisha.
The investigating agency received a tip-off that Sorathia had hidden important documents at his uncle Mohammad Abdul Latif Sorathia’s house. A search was conducted on 17 September, where the cash and gold biscuits were recovered.
State GST officials said several brokers, scrap dealers, and companies that benefited from the fraudulent Input Tax Credit are also under investigation. The department is currently calculating the total GST fraud and said further legal action would be taken against all those involved.
