The Directorate General of GST Intelligence (DGGI) has seen a significant increase in the recovery rate of Goods and Services Tax (GST) dues related to Input Tax Credit (ITC) fraud in FY24. Government sources reveal that DGGI has recovered over 12% of the dues, compared to just 2% to 3% in previous years.
During FY24, GST frauds amounting to Rs 21,089 crore were detected by DGGI, of which Rs 2,577 crore has already been recovered. The department has adopted proactive measures and new technologies such as artificial intelligence and data tools to enhance detection and recovery of GST ITC frauds.
Many of these fraud cases involve the generation of bogus invoices to claim GST benefits, particularly in sectors like manufacturing and real estate. Fraudulent schemes often involve creating fake invoices to claim Input Tax Credit, leading to double benefits for the entities involved.
In some cases, individuals are unwittingly drawn into these frauds, as fraudsters collect their KYC documents under false pretenses to create shell entities. These shell entities then generate bogus GST receipts without the knowledge of the victims.
The government official also highlighted the challenges in recovering fraud amounts, especially in cases where the fraudsters have already disposed of the ill-gotten gains, making recovery difficult. Despite this, efforts are being made to detect and prevent such frauds at an early stage.
Overall, the increasing recovery rate and proactive measures taken by DGGI indicate a concerted effort to combat GST ITC frauds and protect taxpayers from falling victim to such schemes.
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