The Enforcement Directorate has arrested Jamshedpur businessman Gyanchand Jaiswal and his son Raj Jaiswal in a fake GST Input Tax Credit fraud investigation. The wider ED probe concerns a network of shell companies allegedly used to issue bogus invoices worth over ₹5,000 crore and generate fake ITC of around ₹734 crore.
The Enforcement Directorate (ED) has arrested two persons in connection with its ongoing investigation into a large-scale fake GST Input Tax Credit fraud case involving shell companies, bogus invoices and alleged money laundering.
The arrested persons have been identified as Gyanchand Jaiswal, also known as Bablu Jaiswal, and his son Raj Jaiswal, both linked to Jamshedpur. The arrests followed searches carried out by the ED at several locations connected with the investigation.
According to reports, the searches covered premises in Jamshedpur, Adityapur-Gamharia, Deogarh and Kolkata. Investigators examined and seized business records, GST returns, purchase and sales invoices, banking and financial transaction documents and data from electronic devices.
The two accused were subsequently taken to Ranchi and produced before the court, which remanded them to judicial custody. The action forms part of the ED’s investigation under the Prevention of Money Laundering Act, 2002.
The case originated from investigations by the Directorate General of GST Intelligence, Jamshedpur, which had detected an alleged network engaged in generating and passing on fraudulent Input Tax Credit through fake invoices without any corresponding supply of goods or services.
In an earlier official press release, the ED stated that the broader syndicate had created a network of 135 shell companies existing only on paper. These entities were allegedly used to issue bogus invoices worth more than ₹5,000 crore without actual supply of goods or services. Through this mechanism, fake ITC of over ₹734 crore was allegedly generated and passed on to beneficiary firms for a commission.
The ED had earlier filed a prosecution complaint against four alleged masterminds of the network — Shiva Kumar Deora, Mohit Deora, Amit Kumar Gupta and Amit Agarwal alias Vicky Bhalotia — before the Special PMLA Court in Ranchi. Those accused had been arrested earlier in May 2025.
The agency has also taken attachment and seizure action in the matter. Earlier ED proceedings had resulted in the attachment of immovable properties, seizure of cash and freezing of bank balances linked to the alleged proceeds of crime.
The latest arrests indicate that the investigation into the wider GST fraud network is continuing and that the ED is examining additional entities, transactions and persons allegedly connected with the generation and circulation of fake ITC.