Arunachal: Rs 658.55 crore GST fraud exposed, two arrested in nationwide crackdown

In a major breakthrough against tax fraud, the Central GST Itanagar Commissionerate has unearthed a massive Rs 658.55 crore Goods and Services Tax (GST) scam involving fraudulent invoices. The scheme, allegedly orchestrated by a firm registered in Arunachal Pradesh, has resulted in an estimated loss of Rs 99.30 crore to the government exchequer.

According to officials, the fraudulent operations were conducted by M/s Siddhi Vinayak Trade Merchants, which illicitly transferred Input Tax Credit (ITC) to 58 firms across the country using fake invoices. Investigations revealed that the firm was created using forged documents to generate invoices without actual transactions, thereby wrongfully availing ITC.

During the search operation in Kolkata, authorities seized seven mobile phones, an iPad, 53 PAN/Aadhaar cards belonging to various individuals, and 17 rent agreements linked to the fraudulent activities. Multiple KYC documents of fictitious identities were also found, indicating the large-scale and organized nature of the scam. Officials confirmed that the accused were actively managing and filing bogus GST returns from the searched location.

Following the findings, the Central GST Department filed an FIR with Itanagar Police, leading to the arrest of two key masterminds—Ashutosh Kumar Jha and Bipin Kumar Jha—from Darbhanga, Bihar. The duo was taken into custody on February 3, 2025, under Section 69 of the CGST Act, 2017. Authorities have lauded the swift coordination between the GST enforcement teams and Itanagar Police in dismantling the fraudulent network.

The Ministry of Finance has reiterated its commitment to eliminating GST fraud and ensuring strict compliance. This crackdown aligns with the broader national initiative led by the Central Board of Indirect Taxes and Customs (CBIC) to identify and dismantle fake GST registrations and fraudulent invoicing networks. With intensified regulatory measures, businesses engaging in such illegal practices face severe legal consequences.