TMI Blog2021 (6) TMI 639X X X X Extracts X X X X X X X X Extracts X X X X ..... k accounts are opened with Lakshmi Vilas Bank in the name of firms operating at third level showing receipt of sale consideration through banking channels from different business firms/companies in whose name fake GST invoices are issued for passing on ITC. In this process, the petitioner has issued fake GST invoices with a total turnover of ₹ 397,28,11,944/- without supply of goods to different business firms/companies by passing on a total fraudulent input tax credit of ₹ 61,30,33,274/- in respect of 21 firms, out of more than 70 firms created by him and thus caused huge loss to the Government exchequer. The investigation is stated to be pending. Without expressing any opinion on merits of petitioner s case, it is considere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... les of natural justice and consequently to set aside the aforesaid proceedings. Whereas, the writ petition No.21403 of 2020 is filed challenging the proceedings in F.No.DGGSTII/VZU/INV/GST/13/2019, dated 06.03.2020 issued by the 3rd respondent extending the attachment of petitioner s locker No.39 and consequential letter in F.No.DGGI/VZU/ INV/GST/13/2019/2044, dated 09.11.2020 issued by the Deputy Director on the approval of the 3rd respondent informing the 6th respondent Branch Manager, Lakshmi Vilas Bank that 5th respondent is authorized to open bank locker of the petitioner and Smt. P. Usha Rani and her son P. Bhanu Prakash in their presence on 17.11.2020, as illegal, arbitrary and contrary to the provisions of the Central Goods and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... these firms operated in a network so as to conceal evasion. Some of the fictitious/shell firms, where searches were conducted, have admittedly purchased the fake tax invoices without actual receipt of goods from the firms operated by V.V Subba Reddy. Investigation is still under progress. (b) The respondent officials have arrested Vennapusa Venkata Subba Reddy on 11.03.2019 for violation of Section 132(1)(b) and Section 132(1)(c) of CGST Act, 2017 and fraudulently passing on ITC by issuing fake tax invoices without actual supply of goods in the name of different fictitious firms. Learned Judge of Economic Offences Court, Visakhapatnam remanded Vennapusa Venkata Subba Reddy to judicial custody on 12.03.2019 and later conditional bail was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner filed the present writ petitions. (e) The contention of the respondents is that the bank accounts were attached and lockers were sought to be opened as a part of the investigation and by following the CGST Act and Rules and therefore, the petitioner cannot claim any violation of his rights. 3. Heard Sri V.V. Lakshmi Narayana, learned counsel for petitioner and Sri M.V.J.K. Kumar, Senior Standing Counsel for Central Excise, Customs and Service Tax representing respondent Nos.1 to 5. 4. The main contention of the learned counsel for petitioner is that while attaching the bank locker No.39 vide impugned proceedings, no show cause notice was served on the petitioner to offer his explanation. So also the bank locker number-39 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ilitate availment of irregular input tax credit and thereby defrauded the Government s tax revenue. It is further alleged that search operations were conducted in the registered office premises of different enterprises and also the premises of the Accountant of the petitioner and incriminating documents were recovered. Scrutiny of the documents revealed that the petitioner created 70 different fictitious/shell firms in Andhra Pradesh and Telangana for taking GST registrations. The modus operandi of the petitioner was that he opened fictitious firms only on paper to issue fake GST invoices showing supply of iron and steel goods, chemicals, battery scrap, led etc. This fictitious firms generally operated in three levels. The firms operating a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al fraudulent input tax credit of ₹ 61,30,33,274/- in respect of 21 firms, out of more than 70 firms created by him and thus caused huge loss to the Government exchequer. The investigation is stated to be pending. (a) In furtherance of investigation, the Senior Intelligence Officer has attached the bank accounts and lockers of some of the companies on the apprehension that they are operating as shell companies for Vennapusa Venkata Subba Reddy. Therefore, the locker No.39 of the petitioner was freezed under Section 83 of CGST Act, 2017 and decided to open through the authorized Officer. (b) Having regard to the above facts and circumstance and also in view of the fact that the matter has been seized by the learned Special Judge ..... X X X X Extracts X X X X X X X X Extracts X X X X
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