The Cyberabad Police have arrested two individuals for their alleged involvement in a sophisticated inter-state GST fraud network that created 10 fake GST-registered firms and illegally claimed Rs 11.79 crore in Input Tax Credit (ITC). Officials said the arrests were made on November 12 in connection with the case registered earlier in September.
According to a press release from the Cyberabad Police Commissionerate, the accused used a wide range of forged documents including fake Aadhaar cards, PAN cards, electricity bills, rental agreements, GHMC licences and Labour Department certificates to create fictitious business entities and generate fraudulent invoices.
Inter-State Network Behind Large-Scale GST Scam
The fraudulent network operated across multiple states and used fake identities and manipulated government portals to execute the scam. The accused allegedly created an ecosystem of shell firms that existed only on paper, enabling them to claim ITC without any actual supply or movement of goods.
Police said the group used forged documents to obtain SIM cards in false names, which were then used to complete OTP-based verification processes on the GST portal. This allowed them to successfully register fake GST numbers and set up companies that never existed physically.
Modus Operandi: Fabricated Firms, Fake Invoices, Tampered E-Waybills
Investigators revealed that the five-member gang created 10 fake GST-registered firms using fabricated identities. After securing the GST registrations, they generated bogus purchase and sales invoices, inflated turnover figures, and claimed fraudulent ITC.
To make the transactions appear genuine, the accused also created fake E-Waybills using real vehicle registration numbers, but with tampered chassis details. This gave the illusion of goods being transported, despite no actual movement taking place.
Rs 53.73 Crore Fake Turnover Created
Police confirmed that the syndicate generated a fake turnover of Rs 53.73 crore, based on which the fraudulent ITC claim of Rs 11.79 crore was made. The scam caused significant revenue loss to the government.
Two Arrested, Mastermind Still Absconding
The arrested individuals include:
- A 34-year-old man from Gujarat, identified as the organiser and financial handler of the operation.
- A 43-year-old man from Hyderabad, who assisted in the execution of the fraud.
However, the alleged mastermind from Delhi, along with two others including a technical operator responsible for manipulating government portals, remain absconding. Police teams are conducting searches to trace the remaining suspects.
Investigation Underway
Authorities said that the fraudulent activity spanned multiple states and involved a high level of technical manipulation. The Cyberabad Police have intensified their efforts to dismantle the entire network and prevent similar large-scale GST frauds.
The case highlights the growing misuse of digital documentation and the need for stronger verification checks in GST registration and compliance processes.
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