Sant Kabir Nagar: In a major breakthrough in a GST evasion and fake billing case, police have arrested two wanted accused carrying rewards of ₹50,000 each for their alleged involvement in a network that used fictitious firms and fabricated transactions to generate fraudulent tax benefits. Investigators claim the racket caused substantial losses to government revenue through the misuse of the Goods and Services Tax system.
According to officials, the arrests were made during an ongoing investigation initiated on the basis of a complaint filed by the State Tax Department. A joint police team tracked down the accused in Delhi’s Hari Nagar area and took them into custody. Two mobile phones were recovered during the operation, and digital forensic examination of the devices is now underway to identify additional links within the alleged network.
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Investigators stated that the accused allegedly created and operated multiple fake business entities that existed only on paper. These firms were purportedly used to show large-scale commercial transactions without any actual movement of goods or legitimate business activity. Authorities suspect that forged invoices and fabricated e-way bills were generated to create an appearance of genuine trade and facilitate fraudulent tax claims.
During the course of the investigation, officials reportedly found evidence indicating that GST returns filed in May 2025 reflected approximately ₹18.96 crore in fraudulent Input Tax Credit (ITC) claims. Authorities allege that the false claims were used to reduce tax liabilities and obtain unlawful benefits under the GST framework. The case is being examined not only as a tax evasion matter but also as a potential instance of organised financial fraud.
The arrested individuals have been identified as Saurabh Agarwal alias Sunny and Ajit Kumar. Both had allegedly been absconding for an extended period, leading authorities to announce rewards of ₹50,000 each for information leading to their arrest. During questioning, investigators claim the accused disclosed details regarding the registration of fake firms using forged or manipulated documents and the subsequent generation of fabricated invoices in the names of those entities.
According to investigators, the fake invoices and e-way bills were allegedly supplied to various businesses seeking to claim tax benefits without corresponding commercial transactions. Financial records under examination suggest that banking channels were used to make the transactions appear legitimate. Funds were allegedly routed through multiple accounts before being withdrawn in cash, creating the illusion of genuine business operations while concealing the true nature of the transactions.
Authorities believe the fraud was structured through a network involving several participants performing distinct roles, including firm registration, document preparation, account management, and transaction routing. Investigators are now analysing financial records, banking data, digital communications, and electronic evidence to determine the full extent of the operation and identify other individuals who may have been involved.
The case has already resulted in earlier arrests, and officials indicate that additional suspects remain under scrutiny. Investigators are focusing on tracing the financial trail and examining links between the accused and other entities that may have benefited from the alleged scheme. The inquiry is expected to expand as new evidence emerges from seized devices and financial documents.
Renowned cyber crime expert and former IPS officer Prof. Triveni Singh said that organised financial fraud networks often rely on fake documentation, shell entities, and layered banking transactions to conceal the identities of actual beneficiaries. He noted that digital evidence, banking trails, and forensic financial analysis play a crucial role in exposing such schemes and identifying the individuals responsible for orchestrating them.
The investigation remains ongoing, with authorities continuing to examine records connected to the suspected GST fraud network. Officials believe the information obtained from the arrested accused could lead to further arrests and provide deeper insights into the alleged operation. As investigators piece together the financial and digital evidence, the case is expected to reveal the broader structure behind the suspected tax evasion racket.
