PMLA Case: ED Carries Out Searches In 5 States Freezes Bank Balances, Seizes Documents

(MENAFN- IANS) New Delhi/Guwahati, Sep 12 (IANS) The Enforcement Directorate (ED) has conducted search operations at 10 premises across five states including Delhi in connection with a multi-crore fake Input Tax Credit (ITC) fraud under the Prevention of Money Laundering Act (PMLA), 2002, the probe agency said on Friday.

The Itanagar-based ED unit has carried out search operations on at 10 premises across Arunachal Pradesh, Delhi, Haryana, Tamil Nadu, and Telangana on Thursday in connection with a multi-crore fake ITC fraud under the Prevention of Money Laundering Act (PMLA), 2002.

The searches resulted in freezing of bank balances, seizure of immovable property documents, and recovery of incriminating records exposing systematic misuse of the GST framework through bogus invoicing, fake e-way bills, and layered fund transfers.

The ED in a statement said that the case stems from a complaint against Guwahati-based M/s Amit Traders, which was found to be non-existent at its declared address.

Investigation revealed that the firm had fraudulently shown purchases, passed on fake ITC and was linked to M/s Shree Ram Enterprises, which itself availed fake ITC of about Rs 116 crore on bogus invoices worth nearly Rs 700 crore, it said.

The central probe agency said that during the searches, significant frauds came to light. In Arunachal Pradesh, the proprietors of Rainbow Enterprises and A.K. Enterprises admitted availing fake ITC of over Rs 2 crore each without any actual supply or movement of goods.

Another entity, Tanor Engineering, was found to have fraudulently obtained fake ITC of Rs 4 crore, with property worth Rs 3 crore and bank balances of Rs 36 lakh frozen.

In Hyderabad, M/s Vinardh Automobiles Pvt. Ltd. admitted to projecting a fake turnover of Rs 110 crore during 2022–23 and 2023–24 financial years, fabricating records of vehicle manufacture and sales through bogus invoices, and fraudulently claiming GST refunds which were siphoned off and shared among promoters, suppliers, and professional facilitators, with fake e-way bills and kickbacks to officials also detected.

In Haryana, M/s Jai Shree Balaji Traders and M/s Jai Shree Balaji Trading Co. declared fictitious turnovers of Rs 87 crore and Rs 62 crore respectively, and passed on fraudulent ITC to leading multinational companies, highlighting the scale of misuse of the GST mechanism.

In Delhi, M/s Prisha Exim admitted to a reported turnover of Rs 200 crore in recent years, with partners claiming little knowledge of transactions carried out in its name, indicating the use of dummy entities. The primary investigation reveals that fake ITC has been passed to big genuine MNCs for which a detailed investigation is going on.

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