New Delhi: The CGST Delhi South Commissionerate arrested a company director in an ITC fraud case involving over ₹8 crore, officials said.
The Anti-Evasion Branch carried out the action as part of its enforcement drive against tax fraud. Officials said the accused availed and used ineligible Input Tax Credit in violation of Section 16 of the CGST Act, 2017.
Investigators developed intelligence using data analytics. They found that the taxpayer claimed ITC without actual supply from vendors. These suppliers were either suspended or had cancelled registrations. Further checks showed no inward supplies across multiple layers, which broke the credit chain.
Officials also found that the company passed on ineligible ITC to buyers without genuine transactions. This added to the scale of the ITC fraud, officials said.
ITC fraud probe reveals fake supply chain
Authorities recorded the director’s statement under Section 70 of the CGST Act on April 16, 2026. He admitted that he controlled all company transactions. However, he failed to provide documents to support the claims.
Based on findings, officials invoked provisions under Section 132 of the CGST Act. They treated the offence as cognizable and non-bailable. Authorities then arrested the director under Section 69(1) of the Act.
They produced him before the Patiala House Court. The court remanded him to judicial custody till April 30, 2026. Meanwhile, officials said further investigation in the ITC fraud case is ongoing.
