Punjab excise dept unearths fraud of Rs 2,000 crore

As many as 170 business firms were found indulging in bogus transaction with some fake companies here to claim exemption from value-added tax (VAT) to the tune of Rs 2,000 crore, state Department of Excise and Taxation said today.

Several companies were found involved in preparing bogus invoices and setting up fake firms to claim tax credit. Criminal cases against some of them have also been registered, Excise and Taxation Commissioner A Vinu Parsad said.

The fraud came to light when the department sleuths, led by Assistant excise and taxation Commissioner (AETC) Ludhiana Rishi Pal raided a local export-oriented steel unit and discovered fake transactions to the tune of hundreds of crores.

During the investigations it was found that neither the seller nor the buyer in several cases could be traced as they were not found when a team of income tax official went to verify the addresses mentioned in the bills, the department said.

These firms had sought and received the VAT refund (Input Tax Credit) earlier, the department said.