The Directorate of Enforcement (ED), Lucknow zonal office, on Monday conducted search operations at nine premises in Muzaffarnagar and Ghaziabad in Uttar Pradesh and Faridabad in Haryana in connection with a money laundering investigation into the fraudulent availment and passing of bogus Input Tax Credit (ITC).
The investigation further revealed that GST authorities had established fraudulent availment of ITC worth ₹ 9.63 crore and passing on of ITC amounting to ₹ 10.28 crore. Investigators found evidence of extensive circular transactions, rapid layering of funds and subsequent cash withdrawals, indicating an organised mechanism to circulate and conceal the proceeds generated through the fraudulent ITC transactions. The transactions resulted in wrongful loss to the government exchequer, with the corresponding proceeds being treated as proceeds of crime under the PMLA. The ED has not disclosed details of any arrests or seizures so far. Further investigation is in progress to ascertain the full extent of the alleged financial irregularities.
The alleged network used multiple bogus or non-existent entities to create a chain of fictitious transactions, according to the investigation.
