The Enforcement Directorate (ED) has booked several businessmen from Mandi Gobindgarh, Punjab’s prominent steel manufacturing hub, in connection with an alleged GST fraud amounting to ₹3,089 crore. The case is linked to a large network of firms accused of generating fake invoices and claiming fraudulent Input Tax Credit (ITC), causing substantial losses to the government exchequer.
According to investigating agencies, the accused allegedly created and operated multiple shell companies that existed largely on paper. These entities were used to issue bogus GST invoices without the actual supply of goods or services. Through this mechanism, fake ITC was passed on to various businesses, enabling them to reduce their tax liabilities unlawfully. The ED initiated its money laundering probe based on earlier investigations conducted by GST intelligence authorities and other enforcement agencies.
Officials suspect that the fraudulent transactions were routed through numerous firms connected to the iron and steel sector, a major industry in Mandi Gobindgarh. The agency is examining financial records, bank transactions, and property holdings to trace the proceeds of crime and identify beneficiaries of the alleged scam. Searches and scrutiny of documents have reportedly revealed a complex network of transactions designed to evade tax detection.
The latest action is part of a broader crackdown on GST fraud and fake billing rackets in Punjab, particularly in the Mandi Gobindgarh industrial belt, where several cases involving bogus invoices and tax evasion have surfaced in recent years. Authorities have indicated that further arrests and asset attachments may follow as the investigation progresses.
The case highlights the government’s intensified efforts to curb tax evasion and dismantle networks involved in large-scale financial fraud under the GST regime.
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