The Enforcement Wing (South Zone) of the Commercial Taxes Department, Government of Karnataka, arrested a key accused in a massive inter-State fake input tax credit (ITC) fraud involving transactions worth ₹410 crore.
The arrested, Mohammed Tauqeer alias Mohammad, 42, is alleged to be one of the masterminds behind a network of bogus firms that generated and routed fraudulent ITC across Karnataka, Andhra Pradesh, and Tamil Nadu. His associate, Shaik Jakeer Hussain alias Basha, remains absconding.
According to officials, the case is an extension of an earlier probe into fake invoicing activities detected across Karnataka and Tamil Nadu. Subsequent investigation revealed that the duo had floated multiple shell companies and issued fake tax invoices without actual supply of goods, enabling ITC claims.
The accused allegedly routed the fake ITC through a chain of entities, including previously arrested operatives, and eventually to contractors and traders, who used the ineligible credit to offset tax liabilities instead of making cash payments, causing significant loss to the government exchequer.
Officials said the racket involved fraudulent transactions worth ₹410 crore, with wrongful ITC claims estimated at ₹102.5 crore.
Investigators described the modus operandi as highly organised, involving frequent creation and cancellation of GST registrations, constant change of mobile numbers and bank accounts, and operation through multiple layered entities functioning in isolated silos to evade detection.
Both the accused are natives of Chittoor in Andhra Pradesh. While Tauqeer was residing in Bengaluru, Basha is believed to have been operating from Andhra Pradesh before escaping abroad. Their anticipatory bail applications had earlier been rejected by the 69th Additional City Civil and Sessions Court in Bengaluru.
Tauqeer was apprehended while allegedly attempting to abscond following sustained surveillance and intelligence inputs. He was produced before the Special Court for Economic Offences in Bengaluru, which remanded him in 14 days of judicial custody.
Efforts are under way to trace and secure the absconding accused through appropriate legal channels.
