FAKE ITC INVOLVING FAKE BILLING OF 87.91 CRORE; TWO PEOPLE ARRESTED

Ludhiana / Chandigarh 

In an investigation by the Directorate General of GST Intelligence (DGGI), Ludhiana, three business entities, M/s Aar Dee Enterprises, M/s Aashi Steel Industries and M/s Abhi Alloys, all based in Mandi Gobindgarh, were found to have been involved in illegal sale of ₹ 87.91 crores which had led to GST evasion of ₹ 13.41 crores. These business entities were involved in trading of iron and steel articles.

This case has been unearthed, due to the intra-organisational and inter-regional synergy between two offices, DGGI Lucknow in UP and DGGI Ludhiana in Punjab.

Two individuals namely, Shri Raman Kumar Chaurasia and Shri Devinder Singh of Mandi Gobindgarh and Khanna, respectively in Punjab used to procure the iron and steel articles fraudulently through fake billing from Shri Deepanshu Srivastava and one of his accomplices Shri Mohit Kumar, based in Lucknow, Uttar Pradesh. The Lucknow-based individuals, through 37 of their fraudulent business entities, had passed on fake Input Tax Credit to the Mandi Gobindgarh based business entities. On further investigating the Punjab based entities, it was learnt that they had taken fraudulent ITC through fake billing from 78 business entities involving an illegal sale of ₹87.91 crore which led to GST evasion of ₹13.41 crore.

During investigation by DGGI Ludhiana, many pieces of incriminating evidence were found and seized. This was further coorborated in the voluntary statements made and admitted by the aforementioned individuals.

On 15th May, 2025, DGGI Ludhiana placed under arrest Shri Raman Kumar Chaurasia and Shri Devinder Singh for their acts leading to GST evasion of ₹13.41 crores. They have been sent to judicial custody.

DGGI Ludhiana has made multiple strides in its bid to weed-out the menace of fake billing and fraudulent availment, utilization and passing on of Fake ITC.

Fake billing and fraudulent Input Tax Credit (ITC) claims pose a serious threat to the integrity of the indirect taxation system, under Goods and Services Tax (GST) regime. Such acts erode public trust in the tax system by creating an uneven playing field—honest taxpayers bear the burden while fraudsters benefit illicitly. This undermines voluntary tax compliance, a cornerstone of any effective taxation regime.

Moreover, fake billing significantly impacts government revenue, reducing funds available for public welfare, infrastructure, and social development. It distorts the economy, disrupts fair market competition, and can even lead to inflationary pressures when cascading effects trickle down the supply chain.

To protect the social contract and economic health of the nation, it is essential to detect, prevent, and penalize such fraudulent acts. Strong enforcement, digital monitoring, and public awareness are key to restoring trust and ensuring that the benefits of indirect taxation are realized fairly and sustainably across society.

DGGI is the Government of India’s premier Intelligence and Investigating Agency for GST tax evasion, functioning under the Ministry of Finance. In order to tackle the menace of GST evasion, the DGGI develops intelligence, especially in new areas of tax evasion, through advanced tools for data analytics besides using its intelligence network across the country to collect such information.