The Commercial Tax Department has unearthed a fake Goods and Services Tax (GST) racket involving a city-based proprietor who allegedly used a fictitious toy-trading firm to illegally claim and pass on input tax credit (ITC) worth over Rs6 crore.
According to a complaint filed by Assistant Commissioner (State Tax) G. Narender Reddy, the accused, N. Vinod Kumar, operated under the name M/s Bala Corporation and obtained a GST registration in February 2025 by uploading a forged electricity bill as proof of business premises. The declared office address at Cristal Complex, Hill Fort Street, Adarsh Nagar, was later found non-existent during a departmental inspection in May 2025.
Though the firm claimed to trade in toys and video-game consoles, analytics of its e-way bills revealed 1,268 outward consignments in March and April 2025 for construction materials such as cement, copper pipes, plywood, and iron rods.
“No corresponding inward bills were found. Bala Corporation fraudulently availed Rs6.25 crore ITC under IGST and passed Rs3.12 crore each in SGST and CGST to 32 other entities without genuine transactions,” the complaint stated.
The firm’s GST registration was cancelled on May 9, 2025, with retrospective effect from February 25, 2025, after the fraud came to light. However, by then, the government had already suffered losses of Rs6.25 crore.
The Central Crime Station (CCS) Police registered a case against Bala Corporation and proprietor N. Vinod Kumar. Officials said evidence is under analysis, and further legal action will be initiated under relevant GST and criminal provisions.
