In a significant crackdown on financial crime, the Bhubaneswar zonal unit of the Directorate General of GST Intelligence (DGGI) has apprehended the alleged mastermind behind a massive Goods and Services Tax (GST) fraud amounting to a staggering Rs 325 crore. The accused, Nilesh Yogesh Jagiwala, was arrested in Mumbai on Wednesday, marking a pivotal moment in the extensive investigation.
The Elaborate Web of Deceit
Authorities conducted a series of synchronized searches across various locations in Mumbai, unravelling a highly sophisticated and virtually operated scam. Investigations have revealed that Jagiwala masterminded a complex network involving more than 105 shell companies. These entities were not legitimate businesses but existed only on paper, created with the sole purpose of generating fraudulent input tax credit (ITC).
An official statement from the DGGI, released on Friday, highlighted the phantom nature of the operation. It stated that the network created an illusion of genuine business activities but functioned almost entirely through virtual means, with no real physical operations or business premises.
Modus Operandi of the Fraud
The scheme was executed with alarming precision. Key tactics included acquiring dormant companies that already possessed active GST Identification Numbers (GSTINs). The perpetrators then remotely filed documents to replace the original, legitimate directors with dummy individuals who had no real control.
A central element of the fraud was the centralised control of GST portal access, managed through mobile phones and SIM cards controlled by the operators. This allowed a single point of control for the entire illicit network. The operation also involved the mass generation of fake invoices to claim illegal tax credits.
To give the transactions a veneer of legitimacy, the network staged banking transactions, only to later reverse the cash movements. This complex layering was designed specifically to obscure the trail and hide the identities of the ultimate beneficiaries who profited from the scam.
Evidence and Wider Network
During the searches in Mumbai and Pune, investigators secured a substantial cache of incriminating evidence. This included fake company seals, multiple mobile phones, SIM cards directly linked to the fraudulent GST registrations, various digital records, and sensitive bank account details.
This arrest is not an isolated event. It follows the earlier detention of a woman in Pune on October 17, who is suspected to be an accomplice of Jagiwala and served as an operational coordinator within the network. Both individuals are currently in judicial custody as the probe continues to uncover the full extent of this sophisticated financial fraud.
