Investigation by the Special Investigation Branch (SIB) of the State Goods and Services Tax (SGST) department has uncovered a major network of fraudulent firms operating in Muzaffarnagar. Officials allege that these shell companies claimed crores in fake Input Tax Credit (ITC), causing significant losses to the exchequer. Four businessmen have been named, with formal cases registered across multiple police stations.
According to officials, the accused operated under different firm names, creating the appearance of legitimate trading activity. However, subsequent verification revealed no genuine business operations. Instead, the companies allegedly generated false invoices and manipulated electronic billing systems to fraudulently avail ITC.
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A Trail of Bogus Registrations
At the New Mandi police station, SIB Deputy Commissioner Manoj Kumar Shukla filed a case against Shakir of Budhana, who registered “Innovation Recycling Company” in February 2024. Authorities say he claimed ₹6.83 crore in ITC across two financial years without conducting any real trade.
In a separate case, Assistant Commissioner Yogendra Prasad Singh lodged a complaint at City Kotwali against Salim of Kewalpur, accused of running “Sunrise Enterprises” on Roorkee Road. Records show he registered the firm in January 2024 and adjusted ₹2.22 crore of ITC in 2023–24 using fabricated bills.
Meanwhile, State Tax Officer Kavindra Singh registered an FIR at Khala Par police station against Ashish Saini of Wazidpur Khurd. He is alleged to have operated “Shiva Trading Company” from a rented property, presenting it as both a warehouse and an office. Authorities claim he used fake firms for transactions to fraudulently claim ₹6.79 crore in ITC during 2024–25.
In another case, Shukla filed an FIR against Salman of Raidaspuri, who allegedly floated a bogus firm called “Clean India.” Officials said he misused the e-way bill system to pass on ITC and embezzled nearly ₹2.80 crore.
A Larger Network Under Scrutiny
Authorities suggest these cases may represent only a fraction of a broader GST evasion network entrenched in Muzaffarnagar. More firms and individuals are suspected of similar practices, with investigations ongoing. Officials have shared all relevant documents with the police to aid the probe.
The crackdown reflects growing pressure on state authorities to curb GST fraud, a recurring challenge for tax enforcement. With multiple FIRs filed, police have launched formal investigations, but officials acknowledge that such fraudulent setups often operate in clusters, making dismantling the full network a complex task.