The Directorate General of GST Intelligence (DGGI), Bhubaneswar Zonal Unit, has arrested a Maharashtra resident, Nilesh Yogesh Jagiwala for allegedly orchestrating a massive nationwide GST fraud valued at more than ₹325 crore. The accused was detained in Mumbai on Wednesday.
According to an official statement issued by GST Intelligence on Friday, Jagiwala is believed to be the key conspirator behind an extensive network that created and managed over 105 shell companies to illegally generate fraudulent Input Tax Credit (ITC).
Fraud Built on Fake Firms, Forged IDs, and Dummy Directors
Initial investigations revealed that the network operated by registering numerous firms using forged identity documents, installing dummy directors and conducting all activities through virtual means to project an appearance of genuine commercial operations.
Officials stated that the scam involved purchasing dormant companies that still held active GST Identification Numbers (GSTINs). The accused then filed DIR-12 forms to replace genuine directors with fabricated identities. This infrastructure was used for mass generation of fake invoices, staged financial transactions, cash reversals, and circular trading to inflate turnover and claim illegal ITC.
Modus Operandi: Targeting Owners of Failed Businesses
A GST official explained that members of the network targeted owners of businesses that had shut down. These owners were allegedly offered small commissions in exchange for handing over their GSTINs, which were later misused to perpetrate the fraud.
Searches in Mumbai and Pune Recover Fake Seals, Digital Records
Raids conducted at multiple locations in Mumbai and Pune resulted in the seizure of several incriminating materials. These included fake seals of various companies, multiple mobile phones and SIM cards linked to GST registrations, digital documents, bank account details, and transaction logs.
Previous Arrests in the Same Network
The DGGI had earlier arrested a woman from Pune on October 17, believed to be a close associate of Jagiwala and part of the same fraud syndicate.
Authorities Warn Dormant Firm Owners
GST officials have urged owners of dormant companies not to fall prey to such criminal networks. The department advised business owners to surrender their GST registrations free of cost if their business has ceased operations or if they no longer intend to use the registration.