BUSINESS
GST Crackdown: ₹74,782 Crore Fake ITC Fraud Detected in FY 2025–26, Maharashtra and Gujarat Top the List
Central GST authorities uncovered a massive ₹74,782 crore Input Tax Credit (ITC) fraud during the financial year 2025–26, exposing over 30,000 cases across multiple industries. Maharashtra and Gujarat reported the highest number of fraud cases, highlighting the government's intensified efforts to curb GST evasion.
The figures were shared by Minister of State for Finance Pankaj Choudhary in a written reply to the Rajya Sabha.
Maharashtra and Gujarat Report the Most Cases
According to the official data:
| State | Cases Detected | Fraud Amount |
|---|---|---|
| Maharashtra | 9,629 | ₹18,320 crore |
| Gujarat | 12,511 | ₹12,633 crore |
Overall, 30,162 fake ITC cases worth ₹74,782 crore were detected during FY 2025–26, and 358 people were arrested in connection with these investigations.
Fraud Cases Rising Year After Year
The number and value of fake ITC fraud cases have increased significantly over the past three financial years.
| Financial Year | Cases Detected | Fraud Amount | Arrests |
|---|---|---|---|
| 2025–26 | 30,162 | ₹74,782 crore | 358 |
| 2024–25 | 15,283 | ₹58,773 crore | 178 |
| 2023–24 | 9,190 | ₹36,373 crore | 182 |
The data indicates that tax authorities are detecting a growing number of fraudulent GST claims through enhanced monitoring and enforcement.
Sectors Under Investigation
Officials found fake ITC claims across a wide range of industries, including:
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Iron and steel
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Textiles
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Plastics
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Paper products
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Plywood
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Cement
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Copper
Fraud was also detected in several service sectors, such as:
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Works contract services
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Manpower supply
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Real estate services
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Other business service providers
Fake GST Registrations Also Under Scanner
The government also highlighted the misuse of forged identity documents to obtain GST registrations.
During FY 2025–26:
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1,517 fake GST registrations were identified.
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These entities were linked to ₹9,940 crore in fraudulent ITC claims.
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60 people were arrested.
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Seven accused remain absconding.
For comparison:
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FY 2024–25: 3,977 fake registrations involving ₹13,109 crore in fake ITC.
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FY 2023–24: 5,699 fake registrations involving ₹15,085 crore in fake ITC.
While the government did not identify specific sectors where these fake registrations were concentrated, it noted that the fraudulent entities were spread across both manufacturing and service industries.
The Bottom Line
The latest figures underscore the scale of GST fraud being uncovered across India. With fake ITC claims worth ₹74,782 crore detected in FY 2025–26 alone, tax authorities continue to strengthen enforcement through data analytics, verification of GST registrations, and targeted investigations to combat tax evasion and protect government revenue.
