Daily wagers duped into aiding Rs 157-cr GST scam in Ludhiana

             An accountant in Ludhiana devised an elaborate scheme to fraudulently claim input tax credit (ITC) worth crores from the government. But no crime is perfect and after three years of illicit gains, law enforcement agencies finally caught up with his crime, though the mastermind, Sarabjit Singh, remains absconding.

Sarabjit created 20 fake firms in the names of unemployed youth, conducted fraudulent transactions worth Rs 866.67 crore through these entities and fraudulently claimed input tax credit of Rs 157.22 crore using bogus bills.

Singh and his accomplices lured nearly 20 daily wage labourers and unemployed youth and promised them Rs 800 per day in exchange for access to their bank accounts.

Since these men were poor, earning up to just Rs 500 a day, they agreed and shared their bank account and Aadhaar details with the accused. These accounts were then used to register the bogus firms, obtain GST numbers and open associated bank accounts. The firms existed only on paper, with no physical premises or genuine commercial activity.

A senior taxation officer said, “Between 2023 and now, fraudulent transactions worth Rs 866 crore were recorded. The accused claimed input tax credit of Rs 157.22 crore, Rs 45.12 crore in 2023-24 (on bogus transactions worth Rs 249 crore), Rs 104.08 crore in 2024-25 (transactions worth Rs 569.54 crore), and Rs 8.01 crore in the first two months of this fiscal (transactions worth Rs 47.25 crore).”

The State Intelligence and Preventive Unit (SIPU) uncovered the fraud, leading to an FIR in Ludhiana. While Sarabjit Singh remains at large, his two accomplices have reportedly been arrested. Finance Minister Harpal Cheema stated, “We have seized critical evidence, including unsigned cheque books, stamped NEFT forms, fake invoice books and Rs 40 lakh in cash. Investigations are ongoing, focusing on ITC claims, e-way bills and identifying beneficiary firms.” He said SIPU was being strengthened to prevent future frauds.

In a related case, the Department of Taxation uncovered a GST fraud involving Maa Durga Roadlines, a transporter accused of generating bogus e-way bills and facilitating unaccounted goods movement worth Rs 168 crore. Cheema said the e-way bills were created using credentials of Ludhiana-based firms, falsely showing goods movement from Delhi to Ludhiana, although no vehicles actually entered Punjab. The firm engaged in fake transactions involving high-value commodities like copper, tobacco and iron and steel scrap, fraudulently claiming ITC of Rs 30.66 crore.

Source : https://www.tribuneindia.com/news/punjab/daily-wagers-duped-into-aiding-rs-157-cr-gst-scam-in-ludhiana/