The Central GST Commissionerate in Itanagar arrested two men from Bihar’s Darbhanga district on Monday for allegedly orchestrating a massive input tax credit (ITC) fraud through a fake firm registered in Arunachal Pradesh.
In a statement issued on Tuesday, the Commissionerate said the accused used forged documents to create a fictitious company—M/s Siddhi Vinayak Trade Merchants—registered in Itanagar. The firm allegedly generated invoices without any actual supply of goods and manipulated GST returns to fraudulently avail ITC, causing an estimated loss of nearly Rs100 crore to the government exchequer.
Investigations revealed that the fake firm had facilitated the fraudulent passage of Rs99.30 crore in ITC to 58 firms across the country. Officials identified the two masterminds behind the racket as Ashutosh Kumar Jha and Bipin Kumar Jha.
The duo had earlier been arrested by Itanagar Police in a forgery case following a complaint by the CGST. On Monday, they were formally arrested by the GST Commissionerate under Section 69 of the CGST Act, which empowers the commissioner to arrest offenders involved in serious tax evasion.
According to CGST officials, the accused orchestrated a complex nationwide network of fraudulent transactions using fake identities and forged documents to illegally pass ITC. The tax credit mechanism allows businesses to offset taxes paid on purchases against their tax liability on sales.
A CGST official said the brothers—Bipin (32) and Ashutosh (28)—were operating from Kolkata while managing the fake GST network across multiple states. Further investigation is underway.
