Moradabad | November 25, 2025 – A major GST evasion case has surfaced in Uttar Pradesh, revealing a network of bogus firms based in Delhi and Gujarat. During the ongoing investigation in Moradabad, authorities discovered that arrested scrap dealer Ikhlaq’s diary contains the names and contact details of 535 firms, significantly broadening the scope of the probe.
Preliminary investigations suggest the gang has cheated the government of nearly Rs 400 crore in GST. Officials found that some large firms in Gujarat had allegedly used bogus companies to avoid tax payments. The state tax department is now examining registration records across Aligarh, Meerut, Moradabad, and other districts to track irregularities.
SIT investigation uncovers critical evidence
The Special Investigation Team (SIT) retrieved Ikhlaq’s diary, which contains:
- Names of 535 firms
- Contact numbers and other communication details
The police shared this evidence with the State Tax Department, and a team led by Asosh Singh, Additional Commissioner Grade-1, is scrutinizing the registrations of these firms.
Earlier, the tax department had identified 144 bogus firms, but with the discovery from the diary, the investigation has widened significantly, indicating a state-wide network of fraudulent GST registrations.
Structure of the GST evasion network
The investigation revealed the role of Shahid from Meerut, who coordinated with a CA based in Ludhiana to generate e-way bills.
These e-way bills were reportedly exploited by businesses in Delhi and Gujarat using the bogus firms.
Under Shahid’s direction, Ikhlaq used the mobile numbers of an unemployed person, Ankit, to register 144 fake firms with CGST.
Several other firm registrations were processed using call center numbers and supporting documents, all logged in Ikhlaq’s diary.
The SIT also apprehended Ikhtifaq, a scrap dealer, who provided crucial information about iron trading and call center operations. Six primary suspects have been identified, whose CDR records and financial transactions are currently under examination.
Cancellation of bogus registrations
State tax officials have forwarded reports of bogus firms to CGST authorities.
Following this, CGST cancelled registrations of 12 firms.
Senior officials are working round the clock to verify and review additional firms, and more cancellations are expected.
During a mobile enforcement check on Kanth Road in Moradabad, officials intercepted a truck loaded with timber, suspected to be transported illegally to Haryana. Authorities noted that increased inspections have reduced illegal timber transport in the region.
Significance and challenges of the investigation
According to R.A. Seth, Additional Commissioner Grade-2, Moradabad, the probe is time-consuming, and drawing immediate conclusions is difficult. Key findings include:
The GST evasion network is spread across multiple states.
- A call center and mobile number network was used for fraudulent firm registrations.
- Some suspects used the same PAN card across multiple locations to perpetrate the fraud.
Conclusion
The Moradabad case highlights how Delhi and Gujarat-based firms were linked to a state-wide GST evasion network. The diary of Ikhlaq has provided critical leads, helping SIT and state tax authorities trace fraudulent registrations and call center operations.
Investigations are ongoing, with more firms likely to have their registrations cancelled, additional suspects identified, and legal actions initiated in the coming weeks.
The case underscores not only large-scale tax evasion but also systemic vulnerabilities in registration and financial compliance, signaling the need for enhanced oversight and strict enforcement.
