Mumbai businessman arrested for Rs 12.13 crore GST fraud
The Anti-Evasion wing of CGST and Central Excise Mumbai Central has arrested a 51-year-old Mumbai businessman for allegedly fraudulently availing input tax credit (ITC) of nearly Rs 12.13 crore through bogus GST invoices without actual receipt of goods or services.
The agency said the arrested accused, Fakhruddins Dahodwala, is the key person and alleged mastermind behind M/s Sikkander & Co, operating from Chinchbunder in south Mumbai. The firm allegedly availed fraudulent ITC using invoices issued by several fake and non-existent entities. Dahodwala was arrested under various sections of the Central Goods and Services Tax Act, 2017, which carries punishment of up to five years imprisonment and fine.
Investigation details
The investigation began after multiple references were received from various CGST formations and State GST authorities regarding suspicious transactions linked to Sikkander & Co. Authorities alleged that several supplier firms which passed on ITC to the company were either fake, non-existent, or non-functional at their declared business premises.
Among the firms flagged during the probe were Lucas Infratrade LLP, which allegedly passed inadmissible ITC of Rs 50.52 lakh; Prime Trading, which allegedly passed ITC worth Rs 1.99 crore; and Sysintergrated IT & Infra, which allegedly passed Rs 56.91 lakh in inadmissible credit to Sikkander & Co. Investigators also relied on reports from CGST Mumbai East, CGST Thane, Telangana GST authorities, and State GST departments, which reportedly found several supplier entities to be fictitious or non-existent. Officials stated that GST registrations of many such firms had already been cancelled suo motu with retrospective effect.
Operations and evidence
During an inspection conducted, officers allegedly found that Sikkander & Co. was not operating from its declared Chinchbunder premises. Statements recorded during investigation allegedly revealed that the day-to-day operations of the firm, including sales, purchases, and banking activities, were being managed by Dahodwala. Proprietor Masood Ahmad Siddiqi allegedly informed investigators that invoices and e-way bills were generated through a tax consultant on Dahodwala’s instructions.
The firm’s chartered accountant, Abdeali Jawadwala, also allegedly stated that he handled GST filings for the company since August 2024, and received OTP credentials from Dahodwala for accessing the GST portal.
According to investigators, Dahodwala failed to provide supporting documents such as purchase records, transport details, goods registers, supplier documents, invoices, or evidence of actual movement of goods linked to the transactions under scrutiny. Officials alleged that Sikkander & Co. was created as a suspicious GST entity to fraudulently avail and pass on fake ITC using bogus GST registrations.
