The Directorate General of GST Intelligence (DGGI), the country’s top agency monitoring economic crimes, has uncovered a massive Goods and Services Tax (GST) fraud worth ₹19 crore in Surat. The accused, Sheikh Yusuf Abdul Gafur, allegedly carried out bogus transactions of ₹125 crore under the guise of a scrap business to fraudulently claim Input Tax Credit (ITC).
He was arrested and later remanded to 14 days of judicial custody by the court. Acting on specific intelligence, the DGGI unearthed the large-scale GST scam linked to Sheikh Yusuf, a resident of B-402, Exclusive Apartments, Gorat Road. Once a small scrap trader in Turava Mohalla, Yusuf quickly expanded into suspiciously large financial dealings.
According to officials, he established two firms, M.S. Scrap and New Nalbandh Trading, to create fake invoices without any actual movement of goods. Using these fraudulent invoices, he claimed ₹19 crore in Input Tax Credit from the government. Investigations into the bank accounts and business ledgers of both firms revealed transactions amounting to ₹125 crore. Authorities believe these activities were designed solely to manipulate tax records and siphon public money through illegal ITC claims.
Lavish lifestyle raises suspicion
The investigation has also revealed a significant discrepancy between Yusuf’s declared business profile and his opulent lifestyle. Despite claiming to operate a scrap business, he resides in a luxury flat on Surat’s upscale Gorat Road, an area now suspected to be a hub for tax fraudsters involved in bogus billing.
Sources suggest that Yusuf, along with several others, invested crores of rupees from the scam into high-value real estate. Flats in the Gorat Road area currently sell for around ₹2–2.5 crore each, indicating the depth of unaccounted money being funnelled into property. Officials suspect that over 100 such flats may be linked to individuals engaged in similar fake billing operations. The DGGI has alerted the Income Tax Department to initiate parallel investigations into these properties and trace the flow of black money.
Court orders 14 days of Judicial custody
Following his arrest, the DGGI produced Sheikh Yusuf before the court, citing the seriousness of the economic offence and the necessity for extensive investigation. The court accepted the agency’s submission and ordered 14 days of judicial custody for the accused.
The DGGI continues to trace Yusuf’s financial network, while the Income Tax Department is expected to begin inquiries into assets acquired through tax evasion. Officials believe this case could lead to a larger crackdown on the shadow economy sustained by fraudulent GST claims and unaccounted wealth in the region.
