ED Conducts Multi-State Searches in Rs. 100 Crore Fake ITC Fraud Case
Court / Authority
Indirect Taxes and Customs (CBIC)
Update / Judgement Date
22 Jun 2026
Source
WCP News Bulletin
Author
Manas Yadav — WCP Legal Desk
Reading Time
2 min read
View Count
Background
The Directorate of Enforcement (ED), Itanagar Zonal Office, conducted search operations on January 20, 2026, at 10 premises across West Bengal, Manipur and Jharkhand under the Prevention of Money Laundering Act, 2002 (PMLA) in connection with a Rs. 100-crore fake Input Tax Credit (ITC) fraud. The investigation was initiated on the basis of an FIR registered under various provisions of the Indian Penal Code, 1860, following a complaint dated October 3, 2024, by the CGST & Central Excise Commissionerate, Itanagar, against M/s Sidhi Vinayak Trade Merchant, Arunachal Pradesh, which was found to be non-existent at its declared address. ED’s probe revealed that the firm fraudulently issued 15,258 bogus invoices with a taxable value of approximately Rs. 658.55 crore within six months, facilitating wrongful availment of fake ITC worth Rs. 99.31 crore by 58 recipient entities across 11 States during FY 2023–24.
Searches further uncovered that entities such as Dayal Commercial, Apee Enterprises, Phoenix Hydraulics, Ram Awatar Bansal & Co., and Bhima Shankar Industries, operating from Kolkata, were engaged solely in generating bogus bills and passing on ITC. These entities allegedly issued fake invoices worth Rs. 450 crore, fabricated vehicle and sales records, generated fake e-way bills, and fraudulently claimed GST refunds.
In Manipur and Jharkhand, entities were found to have declared fictitious business operations and admitted to availing fake ITC without supporting documents. The searches resulted in freezing of bank accounts, seizure of property documents, recovery of incriminating records, and freezing of Rs. 21 lakh from accounts of M/s S.K. Construction.
Full Judgement / Attachment
Full Judgement
Frequently asked questions about Indirect Taxes and Customs (CBIC)
- What is the CBIC?
- The Central Board of Indirect Taxes and Customs (CBIC), in the Department of Revenue, Ministry of Finance, administers customs, central excise and the Central GST and IGST. It issues notifications, circulars and instructions that field formations follow.
- How do importers and exporters file customs documents?
- Bills of entry and shipping bills are filed electronically through ICEGATE, the CBIC's customs e-commerce gateway. Most bills of entry are assessed under the Faceless Assessment system.
- How do I appeal against a customs order?
- A first appeal lies to the Commissioner (Customs Appeals) within 60 days, with a pre-deposit of 7.5 per cent of the duty in dispute. A further appeal lies to the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) within three months, with a pre-deposit of 10 per cent.
- Where are CBIC notifications published?
- Notifications and circulars on customs, GST and central excise are published on the CBIC website (cbic.gov.in) and in the Gazette of India, under separate series for tariff and non-tariff notifications.
- How can White Collar Professional help with a customs or CBIC matter?
- Post your requirement on White Collar Professional to receive proposals from verified Chartered Accountants, customs brokers and Advocates, compare them, and pay securely through the platform. This page also tracks the latest customs or CBIC CBIC and customs updates as they are reported.
