Probing into a fake Pune based company registered in the name of an auto rickshaw driver, officials of the Directorate of GST Intelligence (DGGI) have unearthed a major fake GST firm scam to the tune of Rs 5,000 crores to Rs 8,000 crores.

Rushi Prakash (39), an officer at DGGI, Pune Zonal Unit, lodged the FIR in this case at the Koregaon Park police station in Pune city on Friday.

The prime accused Ashrafbhai Ibrahimbhai Kalavadiya (50), resident of Surat, Gujarat, is alleged to have opened as many as 246 fake GST firms, using which he committed the multi-crore fraud.

Along with Kalvadiya, police have also booked Nitin Barge, Faizal Mevalal, Nizamuddin Khan, Amit Tejbahadur Singh of Ulhas Nagar, Rahul Baraiyya, Kaushik Makwana, Jitendra Gohel and others in this case, under Indian Penal Code (IPC) sections 420, 465, 467, 471, 120 (b), 34 and sections of the Information Technology Act, the FIR stated.

As per police records, in October 2023, the DGGI team came across suspicious transactions of online accounts of ‘Pathan Enterprises’ located at Girni Shewalwadi on Pune Solapur highway in Pune.

During investigation, DGGI found that Pathan Enterprises did not exist at this spot, or anywhere else. However, it was registered in the name of Pathan Shabbir Khan Anwar Khan, a resident of Bhavnagar in Gujarat. When the DGGI team found Khan, he turned out to be an auto rickshaw driver, who was completely unaware of the company registered in his name.

Further probe revealed that multiple fake GST firms were registered with a particular mobile number and an email address of Pathan Enterprises Company. While checking the suspicious records, the investigation team came across an ICICI bank account in Rajkot, Gujarat, registered in the name of one Jeet Kukadiya. However, when GST officials checked with Kukadiya, he was found to be working as a private security guard and had opened this bank account for accused Kaushik Makwana and Jitendra Gohel. Kukadiya himself never made any financial transactions from this bank account.

Based on leads obtained during further investigation, the DGGI teams carried out raids in Pune, Mumbai, Rajkot and Bhavnagar cities.

A probe revealed that the accused Kalvadiya was operating Pathan Enterprises and several other fake firms.

Subsequently, he was arrested from a hotel in Mira Bhayandar in Mumbai on March 12, 2024. As many as 21 cell phones, two laptops, 11 sim cards, bank debit cards in the name of different persons, cheque books and rubber stamps in the name of different companies were seized from his possession during searches.

A probe revealed that he had allegedly used the seized material for forming fake GST firms and fraudulent GST and bank transactions. A probe also revealed that Kalavadiya was “buying” fake GST firms, bank accounts and sim cards to generate fake GST bills. But he never did any real business of any products and never paid any goods and services tax to the government.

DGGI sleuths arrested him under sections of the Goods and Services Tax Act. He was produced before a court in Pune on March 13, 2024, and is currently under judicial custody in Yerwada jail.

Meanwhile, further probe revealed that the accused Nitin Barge of Mumbai was allegedly looking after all bank accounts and fake GST bills of fake firms operated by Kalavadiya. Mevalal allegedly handled the cash transactions for Kalavadiya.

The accused Nizamuddin Khan, also from Mumbai, was allegedly providing him the sim cards and bank accounts opened fraudulently using KYC documents of common people. Amit Singh allegedly assisted Kalavadiya in opening fake GST firms. Rahul Bariyya was allegedly selling fake GST firms and bank accounts to people, the FIR mentions.

The probe so far revealed that Kalavadiya has opened 246 fake GST firms including Pathan Enterprises. As per the FIT, he allegedly committed a fraud of Rs 20.75 crores through Pathan Enterprises and cheated the government to the tune of Rs 5,000 crores to Rs 8000 crores through all 246 fake GST firms by evading tax between September 2018 and March 2024.