ED Arrests Two In ₹734 Crore Fake GST ITC Fraud Case
The Enforcement Directorate (ED), Ranchi Zonal Office, has arrested Gyaan Chand Jaiswal alias Babloo Jaiswal and Raaj Jaiswal in connection with a money-laundering investigation linked to an alleged fake GST Input Tax Credit (ITC) fraud.
The two were arrested on September 30, 2026, under Section 19 of the Prevention of Money Laundering Act (PMLA), 2002. They were produced before the Special PMLA Court in Ranchi on October 1 and were subsequently sent to judicial custody.
The arrests followed search and seizure operations conducted by the ED on September 30 at four residential and office premises linked to Gyaan Chand Jaiswal, chartered accountant Sanjay Parekh and others in Jamshedpur, Jharkhand, and Kolkata, West Bengal. During the searches, the agency seized several incriminating documents and digital devices.
The ED launched its investigation based on multiple complaints filed by the Directorate General of GST Intelligence (DGGI), Jamshedpur. According to the agency, the probe uncovered a network of 135 shell companies that allegedly existed only on paper and were used to issue bogus invoices worth more than ₹5,000 crore without any actual supply of goods or services.
The alleged network is accused of generating and passing on fake ITC amounting to more than ₹734 crore. The ED said the fraudulently generated credit was subsequently sold on commission to beneficiary firms, which allegedly used the fake ITC to reduce their GST liabilities.
According to the ED investigation, the group allegedly led by Gyaan Chand Jaiswal and Raaj Jaiswal was among the major beneficiaries of the fake ITC network. The agency alleged that companies were incorporated in the names of the accused and their family members, including M/s Maa Sharda Endeavours Pvt. Ltd., M/s Makers Casting Pvt. Ltd. and M/s Kedarnath Trexim Pvt. Ltd.
Another entity, M/s Jai Bhole Enterprises, was allegedly incorporated in the name of an employee.
The ED alleged that fake ITC worth ₹54.33 crore was routed through these entities and subsequently layered into the personal bank accounts of the accused, as well as accounts belonging to their relatives and associated entities. The agency has attributed these funds as proceeds of crime and suspects that the money was used for business activities and the acquisition of movable and immovable properties.
Earlier, the ED had conducted search and seizure operations in May and August 2025 at locations linked to the accused in Kolkata, Jamshedpur, Ranchi and other places. Those operations resulted in the seizure of incriminating documents and digital devices, along with cash seizure and freezing of bank balances amounting to nearly ₹70 lakh.
The agency has also issued two Provisional Attachment Orders (PAOs) involving properties worth more than ₹20 crore.
Four accused persons were previously arrested under the PMLA on May 8, 2025. According to the ED, three of them are currently in judicial custody. A prosecution complaint has also been filed before the Special PMLA Court in Ranchi, where the case is presently at the trial stage.
The ED said further investigation into the case is underway.
News Source : Information for this article was gathered from a variety of reliable news outlets.
