Ludhiana Accountant Uses Daily Wage Workers’ Names for ₹867 Crore Bogus Transactions
A Ludhiana accountant used daily wage workers’ names to run 20 fake firms and carry out Rs. 867 crore bogus GST transactions, fraudulently claiming Rs. 157 crore in tax credit.
A major GST fraud has been uncovered in Ludhiana, where an accountant used the names of daily wage workers to create fake companies and carry out bogus transactions worth Rs. 867 crore over three years. The accused, Sarabjit Singh, is said to have set up 20 fake firms using the names and documents of poor workers who earn daily wages. These fake companies were used to generate fake...
A major GST fraud has been uncovered in Ludhiana, where an accountant used the names of daily wage workers to create fake companies and carry out bogus transactions worth Rs. 867 crore over three years.
The accused, Sarabjit Singh, is said to have set up 20 fake firms using the names and documents of poor workers who earn daily wages. These fake companies were used to generate fake bills and claim input tax credit (ITC) worth Rs. 157 crore from the government without any real business activity.
According to officials, Singh and his team approached unemployed youth and labourers, offering them Rs. 800 per day if they shared their Aadhaar and bank details. Many of these workers, who usually earn around Rs. 500 a day, agreed, not knowing that their names would be used for fraud.
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Using their details, Singh registered fake companies under GST, opened bank accounts, and started generating fake invoices to show business transactions that never actually took place.
A senior tax officer explained how the fraud was carried out:
- In 2023-24, transactions worth Rs. 249 crore were shown, and ITC of Rs. 45 crore was claimed.
- In 2024-25, fake transactions increased to Rs. 570 crore, with Rs. 104 crore in ITC claimed.
- In the first two months of this financial year, fake transactions worth Rs. 47 crore were recorded, with Rs. 8 crore claimed as ITC.
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The State Intelligence and Preventive Unit (SIPU) discovered the scam and filed an FIR in Ludhiana. While Sarabjit Singh is still missing, two of his accomplices have been arrested. The authorities have seized fake invoice books, cheque books, stamped NEFT forms, and Rs. 40 lakh in cash during the investigation.
Punjab Finance Minister Harpal Cheema stated that the investigation will continue to identify other companies and individuals who benefited from this fraud. He also said the government is working to strengthen monitoring to prevent such scams in the future.
In a related case, another GST fraud involving Maa Durga Roadlines, a transporter, was discovered. The transporter created fake e-way bills for goods worth Rs. 168 crore, claiming ITC of Rs. 31 crore on goods like copper, tobacco, and scrap iron, even though the goods never moved.
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