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Punjab tax department busts ₹85.4-crore fake billing racket; Ludhiana businessman held
Punjab's taxation department announced a crackdown on a fake billing and GST fraud racket involving bogus ITC and fake invoices across several states, totaling ₹85.4 crore. Ludhiana-based Paramjeet Singh was arrested by the SIPU in connection with the case, which authorities say involves substantial fake ITC and fraudulent transactions.
Why It Matters
The arrest highlights ongoing enforcement efforts against GST fraud and the use of data analytics to detect irregularities, potentially safeguarding state revenue and deterring similar schemes.
Timeline
6 Events
Legal status and ongoing investigations
May 8, 2026
The accused was arrested under Sections 69 and 132(1)(c) of the Punjab Goods and Services Tax Act, 2017. As the alleged tax evasion exceeds ₹5 crore, the offence is cognisable and non-bailable, carrying a punishment of up to five years imprisonment along with a fine. Investigations are ongoing and the amount involved could increase as more transactions are reviewed.
Search ops recover blank goods receipt books
May 8, 2026
During search operations conducted under the provisions of the PGST/CGST Act, officials recovered blank goods receipt books of multiple transporters, allegedly used to create fake transportation trails.
Fraudulent debit notes used to generate additional fake ITC
May 8, 2026
The investigation also revealed the alleged use of fraudulent debit notes to generate additional fake ITC worth around ₹5.79 crore. The debit notes reportedly contained glaring discrepancies, including taxable values and tax amounts being shown as identical, indicating fabrication.
Discovery of 407 suspicious vehicle movements
May 8, 2026
The probe reportedly uncovered 407 suspicious vehicle movements linked to the fake ITC exceeding ₹2.65 crore.
Use of data analytics to detect ITC discrepancies
May 8, 2026
Cheema said investigators used advanced data analytics, including scrutiny of e-way bills and FASTag toll records, to establish discrepancies in the claimed movement of goods.
Arrest of Ludhiana businessman Paramjeet Singh
May 8, 2026
Punjab Finance Minister Harpal Singh Cheema announced that Paramjeet Singh, director and authorised signatory of M/s API Plastic Recyclers Private Limited, Ludhiana, was arrested by the State Intelligence and Preventive Unit (SIPU) in connection with a fake billing and GST fraud investigation. Singh is accused of wrongfully availing fake input tax credit (ITC) of ₹15.56 crore, generated through bogus invoices issued by non-existent and non-operational firms across several states.