In a major crackdown on white-collar crime, the Anti-Evasion wing of the Central Goods and Services Tax (CGST) Commissionerate, Gurugram, dismantled a large and sophisticated Input Tax Credit (ITC) fraud racket that defrauded the national exchequer of around Rs 200 crores.

According to a CGST official, the modus operandi involved creating several shell entities for artificial layering of funds and invoice-routing without any underlying supply of goods. Four individuals were arrested in connection with the case.

They include two former co-founders of a well-known firm in the auto service sector along with two Chartered Accountants, who allegedly used their financial expertise to engineer the fraudulent input tax credit scheme.

Based on the investigation conducted so far, the accused were arrested under the CGST Act and produced before the Duty Magistrate, Gurugram. In view of the substantial corroborative and incriminating evidence presented by CGST Gurugram, the Court sent all four accused into judicial custody for 14 days.

“All the four accused are highly qualified. They had started their firm four years ago in auto service sector and providing auto service at home. They attract the investors by the circulation strategy and later only made fake bills but never transfer of goods. In all four accused, one from Maharashtra, two from Gurugram and one from Delhi and all are in mid-30 of age. A further probe is underway,” said an official.