Meghalaya Govt Probing ₹500 Crore GST Fraud
The Meghalaya government is investigating a ₹500 crore GST fraud linked to fake firms and coke plants, as announced by Taxation Minister Abu Taher Mondal. These fraudulent firms allegedly issued bogus Input Tax Credit (ITC) to recipients both inside and outside the state.
Key Takeaways
- Fraudulent Activity: Fake firms in Meghalaya are being investigated for passing on bogus ITC using fake invoices. This scheme allows companies, including coke plants, to evade GST.
- Arrests: The case gained traction after four people from Assam were arrested on August 20 in connection with the fake billing. An owner of a coke plant in Assam was also arrested for allegedly evading ₹150-200 crore in GST.
- Government Action: The state’s GST department is actively investigating and coordinating with the Directorate General of GST Intelligence (DGGI) to take action against the fraudulent entities and the recipients of the bogus ITC.
- Challenges: A major hurdle in the investigation is the difficulty for state authorities to verify the genuineness of invoices from suppliers in other states, as they cannot access their GST returns. It’s unclear whether the fake billing is linked to the sale of coke or the purchase of coal, though the latter seems more likely.
- Coke Plant Data: According to GST records, 29 of the 54 registered coke plants in Meghalaya were operational between 2022-23 and 2024-25. Their combined turnover was ₹307.06 crore, with a total tax liability of ₹18.75 crore, of which ₹15.84 crore was discharged through ITC. During this period, these plants purchased 1,48,134 metric tons of coal from outside the state.