The State Goods and Services Tax (SGST) department has arrested a 32-year-old iron trader from Raipur for orchestrating a massive fake input tax credit (ITC) scam, leading to a loss of Rs 26 crore to the exchequer.
Aman Agarwal, the accused, allegedly floated 10 bogus firms between 2023 and 2025 to claim fraudulent GST credits. According to Joint Commissioner Narendra Verma, Agarwal executed fictitious purchases and sales transactions worth Rs 262 crore using ghost companies, availing illegitimate ITC and passing it on to other traders.
The investigation revealed that the firms under Agarwal's control falsely showed the purchase of iron and steel products worth Rs 144 crore. These transactions were recorded using forged documents and were submitted to claim GST refunds. In a shocking revelation, authorities found that some of the firms were registered in the names of individuals who had died years ago, including one who passed away in 2010. Despite this, transactions were shown as occurring in 2013 and 2015, raising serious concerns about verification gaps in the GST registration process.
Special Commissioner of Chhattisgarh GST, T L Dhruv, confirmed that a challan has been filed in court, and a detailed investigation is underway to identify other potential beneficiaries of the fake credits.
Agarwal has been booked under Sections 69 and 132B of the CGST Act, which deal with arrest and punishment for tax evasion. He was taken into judicial custody and further proceedings are ongoing.
Authorities say this case is part of a broader trend of sophisticated GST frauds emerging across the country. The Chhattisgarh GST department has pledged to intensify surveillance and audits, especially in sectors prone to such manipulation, including metals and scrap trading.
This arrest serves as a stark reminder to businesses attempting to misuse the tax system that strict enforcement and prosecution await those indulging in fraudulent practices.
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