The State Tax Department has uncovered a major GST evasion racket involving fake firm registrations and fraudulent invoices. In two separate cases identified by the department, tax evasion of Rs. 14.50 crore and Rs. 1.93 lakh has been detected. While FIRs have been lodged in both cases, no arrests have been made so far.
The action of the SGST Department in choosing not to arrest the accused but only to lodge a First Information Report (FIR) is a significant procedural decision. Under Section 69 of the Central Goods and Services Tax (CGST) Act, 2017, GST officers in India are empowered to make arrests for specified offences. These arrest powers operate in conjunction with the offences and penalties listed under Section 132 of the same Act. However, when the department opts to file an FIR instead of exercising its statutory arrest powers, the subsequent investigation is transferred to the police—who generally lack specialised expertise in GST law. This often hampers the trial and weakens the prosecution. Moreover, once an FIR is filed, the accused can approach the High Court seeking quashing of the FIR, creating an avenue to evade liability. Such procedural lapses not only delay justice but also risk substantial loss of revenue to the nation.
Case 1: Rs. 14.50 Crore GST Evasion Through a Non-Existent Firm
State Tax Officer Pradeep Gupta reported that Ashish Anant Ambre, a resident of Anand Gyanan Apartment in Dombivli East, Thane (Maharashtra), registered a firm named “Aashiq Enterprises” at Gagan Plaza, Rohta Road, on 12 January 2022.
During the financial year 2022–23, invoices totaling ₹14.50 crore were generated in the firm’s name to claim GST input tax credit. However, when officials visited the registered premises, no such firm existed at the location.
Enquiries in the surrounding area confirmed that no business under the stated name had ever operated there. TP Nagar police have registered a case for fraud and GST evasion based on the department’s complaint.
Case 2: Rs. 1.93 Lakh GST Evasion Through Fake Outward Supplies
In another complaint filed by State Tax Officer Rakesh Kumar Kannaujia, Narendra Pratap Singh, a resident of Govindpur Road in Almora district (Uttarakhand), registered a firm named “Anny Enterprises” at Jagriti Vihar, Sector-3, on 6 April 2021.
For the financial year 2021–22, the accused allegedly declared fictitious outward supplies without any actual movement of goods, resulting in GST evasion of ₹1.93 lakh. A physical inspection of the declared premises revealed that no firm operated there.
Medical police station has lodged the FIR and initiated efforts to trace the accused, who remains absconding.
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