The two agencies carried out search operations at 336 different locations across the country.
The operations covered entities in over a dozen states, including Gujarat, Maharashtra, Delhi, Haryana, Uttar Pradesh, West Bengal and Karnataka. The case involves a large number of exporters sending out goods on payment of integrated GST (IGST) almost entirely out of the ITC availed on the basis of fake supplies.
"The joint operation of the two premier intelligence agencies of Central Board of Indirect Taxes and Customs (CBIC) was a first of its kind in the history of CBIC, which involved about 1200 officers from both the agencies," a Finance Ministry statement said.
The search operations were carried out based on the data analytics and intelligence gathering by DGGI and DRI, two premier agencies specialising in economic offences.
The preliminary investigation has revealed that exporters were shipping goods out of India on payment of tax (IGST), being done almost entirely out of the ITC availed on the basis of ineligible or fake supplies. Further, such IGST payments were claimed as refund on export.
Based on the data provided by the Directorate General of Analytics and Risk Management (DGARM), analysis was conducted wherein certain 'red flag' indicator filters were applied to the Customs' export data in conjunction with the corresponding GST data of the exporters.
"It was also noticed that there was no or negligible payment of tax through cash by the exporters as well as their suppliers. In few cases, even the tax paid through ITC was more than the ITC availed by these firms. On the basis of this intelligence, massive searches were conducted on the premises of exporters and their suppliers," the statement said.