How an 8-member gang pulled off a ₹8,000cr GST scam
What's the story
Pune Police have busted a massive Goods and Services Tax (GST) fraud, worth an estimated ₹5,000-₹8,000 crore. The elaborate scheme was masterminded by eight people who set up 246 fake firms across 13 states.
Asraf Ibrahim Kalawadiya (50), a resident of Surat, has been identified as the alleged mastermind of the operation.
The case was registered at Koregaon Park police station under charges of criminal conspiracy, cheating, and forgery.
Duration
Fraudulent transactions spanned over 5 years
The fraud was committed between September 2018 and March 2024.
The GST department took up the case after learning that Pathan Enterprises, a fictitious firm based at Shiv Chaitanya Colony in Hadapsar, had evaded taxes worth ₹20.25 crore.
Kalawadiya is now in judicial custody at Yerawada Central Prison, after his arrest by the Directorate General of GST Intelligence (DGGI), Pune zonal unit.
His seven accomplices are still absconding.
Scam details
A look at the modus operandi
Rishi Prakash, a senior intelligence officer of the DGGI, revealed that the same mobile number and email address used to register Pathan Enterprises were also used to register several bogus firms.
None of these firms paid taxes between ₹5,000-₹8,000 crore during the period.
After a preliminary inquiry on the basis of this information, an FIR was registered and the probe has now been handed over to the Economic Offences Wing.
Identity theft
Unaware individuals' identities used in the scam
The investigation traced Pathan Shabbir Khan Anwar Khan, whose PAN card was used to register Pathan Enterprises.
However, Khan, an auto-rickshaw driver in Gujarat's Bhavnagar, denied knowledge of any enterprises running in his name.
A similar case surfaced with a bank account in Rajkot in Jeet Kukadiya's name. Kukadiya, a security guard by profession, also denied knowledge of the account's operations.
Confession
Mastermind's confession and recovery of incriminating evidence
Kalawadiya was found to be the mastermind of this tax evasion racket after studying bank statements and call records.
He was traced to a hotel in Mira Bhayander, Mumbai, and a search there recovered several cellphones, laptops, SIM cards, debit cards, cheque books, and rubber stamps.
On being questioned by authorities, Kalawadiya admitted to opening multiple fake companies and bank accounts with forged documents for fraudulent transactions to evade taxes.