High Court Grants Bail to 49-Year-Old Accused in Rs 11.44 Crore Fake ITC Fraud Case

The Honourable Chief Justice Ramesh Sinha of the Chhattisgarh High Court on April 10, 2026, granted bail to a 49-year-old Santosh Wadhwani, alleged to have claimed incorrect ITC worth about Rs 12 crore using four bogus firms, which did not even exist in reality.

Santosh Wadhwani (petitioner) was arrested by the Directorate General of Goods and Services Tax Intelligence (DGGI), Raipur Unit, in January 2026. He was accused of incorrectly availing Input Tax Credit (ITC) amounting to Rs 11.44 crore using fake transactions with four firms, including M/s. Aksha Trading, M/s. M.K. Enterprises, M/s. Dishankar Trading and M/s. Giridhar Gopal Impex Pvt. Ltd. These firms were not in existence or were not conducting real business.

As per the prosecution, these transactions only existed on paper, without actual movement of goods. The counsel of the accused argued that his client is innocent and has not committed any offence, as the case was entirely based on documents that were already in possession of the tax authorities. They further argued that tax authorities did not properly conduct any tax assessment before making the arrest. Further claimed that, as no further interrogation is required in the present case, continuing custody would be a waste of time.

However, the prosecution, DGGI, requested the court not to grant Santosh bail, as the matter is serious and involves large-scale GST fraud. Further, the petitioner had played a key role in orchestrating the entire fraud by running multiple fake firms, which did not even exist in reality, and making incorrect ITC claims using them.

When the court heard the arguments from both sides, it noted that the investigation was mostly completed and no further custody was needed in the present matter. Additionally, most of the evidence was documentary. However, the court also noted that these kinds of offences usually carry a maximum punishment of five years. Therefore, the court decided to grant bail to the petitioner on the condition that he submits a personal bond in the sum of Rs 1 lakh with one solvent surety to the satisfaction of the concerned Court, until the trial is completed.