DGGI busts ₹217 crore fake ITC racket spanning AP, Telangana

The Directorate General of GST Intelligence (DGGI) has busted a ₹217 crore fake input tax credit (ITC) racket operating across Andhra Pradesh and Telangana, exposing a network of 72 shell firms.

Officials acted on intelligence inputs that flagged unusual GST registration patterns. They used data analytics, risk profiling, and field checks to identify firms with little or no real business activity. Despite this, the firms generated invoices and availed of ITC.

The probe uncovered a well-organised syndicate that created shell companies to generate and circulate fake ITC. The accused used Aadhaar and PAN details of unsuspecting individuals and projected them as proprietors. They rented small or non-functional shops and used fabricated agreements and utility documents to secure GST registrations and open bank accounts.

Investigators found that Dhantla Aadi Reddy, alias Anji Reddy, allegedly masterminded the operation and remains absconding. The syndicate retained control by manipulating contact details and login credentials. This allowed it to handle filings, generate invoices, and transfer credits from a central system.

Officials arrested two key operatives — Siddagoni Prabhakar and Ramavath Nagaraju Naik. Nagaraju Naik managed fieldwork, identified premises, arranged fake documents, and handled bank operations. Prabhakar processed GST registrations, coordinated biometric authentication, and handed over login credentials to the syndicate.

The shell firms issued invoices without supplying goods or services. The network availed fake ITC worth ₹217 crore against invoice transactions of about ₹1,472 crore, officials said.

The case falls under Sections 132(1)(b) and 132(1)(c) of the CGST Act, 2017, which are cognisable and non-bailable. Authorities arrested the accused under Section 69 of the Act and are continuing the investigation.