The Department of Trade and Taxes, Government of Delhi, has uncovered a major Goods and Services Tax (GST) refund fraud estimated at ₹14 crore, leading to the arrest of a proprietor involved in the scheme.
Authorities have also frozen 45 bank accounts tied to 27 entities suspected of participating in the scam.
An FIR has been registered with the Economic Offences Wing (EOW), and ₹1.16 crore has already been recovered, officials confirmed. Efforts are ongoing to recover the remaining amount.
According to a senior official from the department, investigations unearthed a complex network of individuals behind the creation and operation of four fake firms. These entities allegedly claimed GST refunds by posing as legitimate businesses.
The probe utilized advanced data analytics and a detailed examination of banking transactions to trace the fraudulent flow of money across various entities—not only within Delhi but also spanning other Indian states and overseas jurisdictions such as Hong Kong and Singapore.
Officials discovered that multiple firms involved in the fraud were using identical PAN numbers, mobile contacts, and email addresses, indicating coordinated operations. As a result, the registration of several Delhi-based entities has been suspended. Relevant details have also been shared with tax authorities in other states to initiate appropriate action in their respective jurisdictions.
In collaboration with the Income Tax Department, the Delhi government has flagged and recommended the deactivation of PANs connected to the scam.
“This operation highlights the department’s commitment to rooting out tax fraud and safeguarding public revenue,” the official stated.
Further investigations are underway, and more arrests may follow as enforcement agencies widen the probe.
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