Bhopal, May 28 (IANS): The Central Goods and Services Tax (CGST) department of Madhya Pradesh has busted a fake GST credit racket involved in generating and passing fake invoices of more than Rs 100 crore, an official said on Saturday.

Based on inputs, the officials of the CGST department along with the police claimed to have arrested two persons from Surat in Gujarat.

The official on Saturday said that two persons, the key operator of the alleged fake racket and one of his close accomplices were arrested during a raid on May 25 and they were taken to Indore.

Details of more than 500 fake firms along with incriminating documents, materials, data, and several mobile phones have been recovered from their possession.

Besides, around 300 bogus firm seals and letter pads were also recovered during the search operation.

"They used forged documents, addresses and fake identities to register firms and to generate and pass fake GST credit using multiple layers of transactions. They were routing the transactions through mobile digital wallet accounts linked with different mobile numbers avoiding conventional banking channels. They also seem to be involved in identity theft besides defrauding the government revenues," said Partha Roy Chowdhury, principal commissioner of CGST and Central Excise, Indore.

Chowdhury further said that both the arrested persons are currently on remand for further investigation.