Sri Kavya Mining MD arrested for Rs 18.55 crore GST fraud

HYDERABAD: In a major crackdown on tax evasion, the Telangana Commercial Taxes Department has unearthed a Rs 18.55 crore Goods and Services Tax (GST) scam and arrested the managing director of a mining company involved.

Rajkumar Rekhya Roopsing Nayak, head of M/s Sri Kavya Mining Infrastructures Private Limited, allegedly indulged in a fraudulent scheme involving fake invoices and wrongful Input Tax Credit (ITC) claims. The department's investigation revealed that the company issued GST invoices without actually supplying any goods or services, creating the illusion of transactions for beneficiary companies. These beneficiary companies then availed the ITC based on these fake invoices, claiming undue tax benefits from the Government.

According to the department, Sri Kavya Mining Infrastructures Private Limited, essentially, acted as a conduit, routing the transactions without any actual supply and passing on the ITC credit to beneficiary companies. The company itself also availed Rs 4.12 crore in wrong ITC, not supported by actual transactions. This modus operandi resulted in a double loss for the Government exchequer: Loss of revenue from uncollected taxes on fake transactions and undue benefit to beneficiary companies through fraudulent ITC claims.

Acting swiftly, the department arrested Nayak under the provisions of the Telangana Goods and Services Tax Act, 2017. He was remanded to judicial custody by the court for economic offences.

Commenting on the arrest, Dr TK Sreedevi, Commissioner of Commercial Taxes, Telangana, stated, "This arrest sends a strong message to those trying to game the GST system. We are committed to protecting the Government's revenue and ensuring fair competition in the market. Further investigation is underway to identify the mastermind behind this scam and bring them to justice."