CGST Delhi South Arrests Two in ₹8.5 Crore Fake ITC Scam Involving Bogus Invoices

New Delhi, January 15: The Anti-Evasion wing of the Central Goods and Services Tax (CGST) Delhi South Commissionerate has arrested two individuals in connection with a large-scale tax fraud involving the wrongful claim of Input Tax Credit (ITC) worth over ₹8.5 crore.

According to officials, the accused allegedly generated fake invoices amounting to nearly ₹200 crore without any actual movement or supply of goods, enabling them to unlawfully avail ineligible ITC. The operation was carried out through paper entities created solely to facilitate tax evasion.

CGST officials conducted extensive searches between January 12 and 13, 2026, at the firm’s registered business address, associated premises, and residential locations of the accused. During the searches, several locations were found to be either closed or non-functional, with no genuine business activity taking place.

Statements recorded under the provisions of the CGST Act, 2017 revealed that the business operations were being controlled by the proprietor’s father. Both individuals reportedly admitted to their involvement in claiming fraudulent ITC using fictitious invoices.

Investigators identified the proprietor and his father as the primary beneficiaries of the tax evasion. The offence falls under Section 132 of the CGST Act, 2017, which deals with serious GST-related fraud and carries stringent penal consequences.

Following their arrest, the accused were produced before the duty magistrate and have been sent to judicial custody for a period of 14 days.

Officials said the investigation is still underway to track the movement of funds and to identify any other individuals or entities that may have benefited from the fraudulent transactions.