New Delhi: A major GST fraud racket involving fake companies, forged transactions and fraudulent tax credit claims has been uncovered in the national capital, where unemployed youths were allegedly lured with promises of jobs and their identity documents misused to create shell firms worth crores of rupees on paper.
The Economic Offences Wing (EOW) investigation revealed that the organised network created nearly 250 shell companies and routed transactions worth more than ₹128 crore through them. Investigators say fake billing, fraudulent Input Tax Credit (ITC) claims and suspicious banking operations were used to execute the large-scale financial fraud.
Identity Deception and Corporate Registration Inversion
According to investigators, the case came to light in January when a GST department team visited the house of 25-year-old Ankush in Northeast Delhi’s Gokulpuri area. Officials informed the family that a firm named “R K Enterprises” had been registered in Ankush’s name and had reportedly shown a turnover of ₹128 crore within a few months without paying the corresponding GST dues. The revelation shocked the family because Ankush was not a businessman and was working in a contract-based role at a coaching institute.
Ankush later told police that during a period of unemployment, an acquaintance had promised to help him secure a job in the GST department. Under that pretext, copies of his identity card, PAN card and other personal documents were collected. Investigators later discovered that those documents had allegedly been used to create a fake proprietorship firm and conduct large-scale financial transactions without his knowledge.
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Daryaganj Syndicate Hub and Mastermind Profiles
As the probe expanded, investigators uncovered an organised syndicate allegedly operating out of Delhi’s Daryaganj area. Police arrested seven accused in connection with the case, including alleged mastermind Raj Kumar Dixit, his brother and several associates. According to investigators, the network had been targeting unemployed youths, economically weaker individuals and job seekers for several years in order to collect identity documents for fraudulent use.
Police sources said the gang allegedly created fake GST firms and generated bogus invoices showing business transactions that never actually took place. These fabricated transactions were then used to claim fraudulent Input Tax Credit benefits. Investigators also suspect that the shell companies were being used to route suspicious money through the banking system and project unaccounted cash as legitimate business activity.
Account Laundering Intermediaries and Cash Conversion Channels
The investigation further revealed that the syndicate targeted traders dealing heavily in cash transactions. Shell company accounts were allegedly used to convert unaccounted cash into seemingly legal bank transfers, while commissions were deducted for facilitating the transactions. Officials believe crores of rupees in suspicious funds may have been routed through the network in this manner.
Investigators also found that several financially vulnerable individuals were allegedly paid between ₹15,000 and ₹20,000 in exchange for access to their bank accounts and identity documents. These accounts were later used for fake GST transactions and fraudulent tax credit claims. Authorities suspect the network may have links extending beyond Delhi into multiple states.
Digital System Vulnerabilities and Biometric Solutions
Experts tracking cyber-enabled financial crimes say organised fraud syndicates are increasingly exploiting digital tax systems and online registration processes to execute sophisticated economic offences. Renowned cyber crime expert and former IPS officer Prof. Triveni Singh said identity theft, fake company networks and misuse of digital taxation platforms could emerge as a major threat to financial security in the coming years. According to him, stronger cyber verification systems, biometric authentication and advanced digital auditing mechanisms are essential to curb such organised financial frauds effectively.
Investigating agencies are now examining the role of additional suspects, suspicious bank accounts and other shell entities linked to the racket. Officials believe the case may not be limited to a single fake company, but could be part of a much larger nationwide network involved in tax evasion, hawala-style transactions and organised financial fraud.
