GST SCAM: CGST Uncovers 23.48 Crore ITC Fraud by Scrap Trading Firm

The Central Goods and Services Officials have discovered a scam where the firm was involved in using fake invoices from non-existent firms to claim and pass on ineligible ITC without any actual supply or receipt of goods, causing a loss to the government.

The officers of the CGST Gautam Budh Nagar Commissionerate carried out an investigation at the business premises of major suppliers of M/s New Global Scrap Traders. On investigation, it was found that these were fake suppliers that never existed. Further evidence also revealed that M/s New Global Scrap Traders had wrongly claimed and passed on Input Tax Credit (ITC) without making any actual supply of goods.

The initial verification of the evidence has uncovered that the firm has wrongly claimed and passed on ITC worth approximately Rs 23.48 crore.

During the investigation, Shri Azaharuddin, the owner of the firm, confessed to his scam of fraudulently availing ITC. He confirmed that the firm acquired only invoices and issued them to fake entities, without actually supplying the goods.

As a result, Shri Azaharuddin was arrested on June 13, 2025, under Section 69 of the CGST Act and has been sent to judicial custody for 14 days by the order of the Hon’ble Special CJM Court in Meerut. The investigation is still ongoing.