According to the provisions of the Prevention of Money Laundering Act (PMLA), 2002, the Directorate of Enforcement (ED) conducted search operations at 25 locations on June 2, 2023, in Ahmedabad, Gandhinagar, Bhavnagar, Botad, Gandhidham, Mumbai (Maharastra), and Bengaluru (Karnataka). This was in connection with the case against Mohammad Ejaj Bomar & others (GST Fraud case). The locations of the accused individuals who prepared the fictitious paperwork used to create false GST businesses as well as the organisations utilised to provide fictitious Input Tax Credit (ITC) were searched.
On the basis of FIRs filed by Bhavnagar Police against Mohammad Ejaj Bomar and others for numerous offences punishable under different sections of the IPC, 1860, the ED began an investigation into money laundering. Additionally, according to the police’s charge sheet, these suspects altered the cellphone number associated with other people’s Aadhar cards while promising them financial aid via government programmes, then used those Aadhar cards to get PANs before registering for GST. The police charge sheet states that phoney invoices totalling more than Rs. 1102 crore and GST evasion totalling Rs. 122 crore were produced using 461 fictitious companies.
In order to gain GST registration, the accused are forming fictitious firms using fraudulent papers. Later, by creating fictitious invoices on a commission basis, these bogus firms transfer Input Tax Credits to beneficiaries. Payment for these fraudulent bills is made through banking channels, and the beneficiary and operator of the false entity then settle the amount in cash.
A large number of incriminating papers, including forms for altering mobile numbers on Aadhar cards, phoney bills issued by these fictitious organisations, and digital evidence were confiscated during the search operation in accordance with the PMLA, 2002. Additionally, cash worth Rs. 29 lakhs were also found during the search. The probe is being expanded upon.
