UP STF Busts ₹500 Cr GST Fake Invoice Racket: 8 Arrested in Massive Shell Firm Crackdown

The Uttar Pradesh Special Task Force (STF) has dismantled a large-scale Goods and Services Tax (GST) fraud operation allegedly responsible for evading more than ₹500 crore in government revenue. Authorities say the network operated through dozens of shell companies across multiple states, issuing fake invoices and e-way bills to illegally pass on Input Tax Credit (ITC) to legitimate businesses.

Eight people have been arrested so far in what officials describe as a highly organized and technologically driven financial crime syndicate. Further arrests are expected as the investigation expands.

Meerut and Ghaziabad at the Center of Operations

According to investigators, the fraud was primarily coordinated from Meerut and Ghaziabad. The alleged kingpin, Dilshad Malik, is believed to have overseen the operation from offices linked to accounting and financial consultancy services in the region.

The other arrested individuals have been identified as Ramesh Patel, Ankur Tiwari, Swatantra Kumar Tiwari, Mohammad Wasim, Mohammad Sohel, Javed Malik and Ikramuddin. STF officials said each member had a specific role, ranging from registering companies using forged documents to managing billing, generating e-way bills and filing GST returns.

All eight suspects were taken into custody following coordinated raids and interrogations by the STF’s Meerut unit.

Over 90 Shell Firms Uncovered

Search operations conducted at multiple locations led to the seizure of extensive evidence, including laptops, mobile phones, rubber stamps, cheque books, debit and credit cards, copies of Aadhaar and PAN cards, billing files, transport logbooks and large amounts of cash. Four vehicles allegedly used by the group were also confiscated.

Preliminary analysis of the seized documents suggests the existence of more than 90 shell companies created solely to facilitate fake transactions. Officials believe the network expanded steadily over time to increase the scale of fraudulent billing.

Fraud Spread Across Several States

While many shell firms were registered in districts such as Meerut, Ghaziabad, Hapur, Noida, Lucknow, Kanpur, Agra and Varanasi, the STF said the racket had a nationwide footprint. Fake firms and linked transactions were traced to states including Maharashtra, Gujarat, Madhya Pradesh, Tamil Nadu, Kerala, Karnataka, Telangana, Bihar, Jharkhand, Assam and Delhi.

Investigators are also examining the role of an Agra-based entity, Sharma Enterprises, which is suspected of facilitating GST evasion amounting to nearly ₹137 crore on its own.

WhatsApp Orders and Paper Transactions

Officials said the syndicate relied heavily on messaging platforms such as WhatsApp to coordinate with genuine traders. Businesses allegedly shared their GST numbers and transaction details, after which the accused generated invoices and e-way bills in the names of shell firms and uploaded them to the GST portal.

To create an illusion of legitimate trade, bank transactions were shown on paper. In reality, authorities claim that settlements were largely done through cash adjustments or circular fund movements, with no actual movement of goods or services.

Legal Action and Ongoing Investigation

The case is linked to a First Information Report registered at Lohamandi police station in Agra. The accused have been booked under provisions of the Behavioural Non-Compliance and GST Fraud (BNS) Act, which covers offences involving fake invoicing, misrepresentation and fraudulent claims of ITC.

The STF has begun forensic analysis of electronic devices and financial records and is tracking complex bank trails associated with the shell companies. Officials said coordination with GST authorities and other enforcement agencies has been intensified to identify additional beneficiaries and dismantle the wider network.

“This appears to be a deep-rooted and well-planned operation,” an STF official said, adding that the scale of the fraud may grow as more data is examined.