- Mega GST Fraud Exposed: DGGI Ahmedabad Cracks ₹1,825 Crore Input Tax Credit Scam; Mastermind Arrested at Delhi Airport
- Global Escape Ends: Key Accused Held at IGI Airport After Dubai Return
NE LAW & BUSINESS BUREAU
NEW DELHI, APR 20
Officials of the Directorate General of GST Intelligence (DGGI), Ahmedabad Zonal Unit, arrested alleged mastermind Kapil Chugh on 19 April 2026 at Indira Gandhi International Airport, Delhi, upon his return from Dubai. Chugh had been evading summons and investigation.
₹1,825 Crore Fraud Network: Fake Firms, Bogus Invoices and Shell Entities Exposed
Investigations revealed a highly structured fraud involving creation of dummy firms using borrowed KYC documents. These entities were used to generate fake purchase invoices without actual movement of goods, enabling fraudulent Input Tax Credit (ITC) claims and GST refunds.
Layered Paper Trail: Fake ITC Routed Through Multiple Shell Companies
Officials found that fraudulent ITC was circulated through a chain of intermediary firms, creating a fabricated trading ecosystem. The entities, lacking infrastructure or manpower, functioned only on paper while being centrally controlled by the masterminds.
Inflated Exports, Fake Goods & Zero-Rated Supply Abuse
The accused reportedly misdeclared low-value tobacco products as high-value goods like Kimam and Jarda to inflate export value. These were shown as zero-rated supplies under LUT to claim illegitimate GST refunds, with exports found to be largely fictitious or grossly exaggerated.
Multi-Agency Action: CBI Charges, SEBI Order & Financial Irregularities
Apart from GST fraud, Kapil Chugh was earlier charge-sheeted by the CBI for fraudulently obtaining credit using forged documents. SEBI has also taken action against associate Vipin Sharma for inflating corporate valuation through bogus turnover. Financial analysis showed circular fund movement with large cash withdrawals and no genuine business activity.
Key Investigation Findings
- 22 summons ignored by accused before fleeing to Dubai
- Dummy directors paid fixed monthly cash compensation
- Fake e-way bills and repeated vehicle registrations used
- Common IP addresses and accounting teams across firms
- Negligible real logistics or supplier payments detected
