The Enforcement Directorate has conducted searches at multiple locations in Uttar Pradesh and Haryana as part of a money laundering investigation linked to an alleged ₹9.63-crore GST fraud. The searches covered nine premises in Muzaffarnagar and Ghaziabad, along with locations in Faridabad. Investigators are examining allegations that Jambudwip Exports and Imports and associated entities generated fraudulent Input Tax Credit through purportedly fake invoices and e-way bills without genuine movement of goods. The ED is now tracing financial transactions, suspected proceeds of crime, and potential beneficiaries.
ED Raids Multiple Locations in UP and Haryana Over Rs 9.63-Crore GST Fraud Case
Searches were conducted at nine locations in Muzaffarnagar and Ghaziabad, and also in Faridabad, in connection with a money laundering investigation under the PMLA, the Enforcement Directorate said.
Searches by the Enforcement Directorate (ED) at several premises in Uttar Pradesh and Haryana are being carried out in a money laundering investigation in connection with an alleged Rs 9.63-crore GST fraud.
The searches were conducted on Monday under the Prevention of Money Laundering Act and covered nine premises in Muzaffarnagar and Ghaziabad in the state of Uttar Pradesh.
Investigators also searched more places in Faridabad, Haryana, as part of their probe into the transactions allegedly linked to bogus Input Tax Credit claims and suspected laundering of proceeds.
The probe is based on the fact that Jambudwip Exports and Imports allegedly created and passed fake Input Tax Credit using fake invoices and e-way bills, officials said.
The Enforcement Directorate said the documents were allegedly created without any real movement of goods to make transactions appear legitimate to support fraudulent GST credit claims.
GST authorities have detected fraudulent availment of Rs 9.63 crore in Input Tax Credit, allegedly leading to wrongful loss to the government exchequer.
The money laundering probe is financially based on the alleged fraud. The Enforcement Directorate is investigating whether the proceeds from the disputed tax credit were generated and moved through layered transactions.
Jambudwip Exports and Imports at Centre of GST Fraud Probe
Jambudwip Exports and Imports allegedly used circular transactions involving multiple entities to move money around and create a trail to support the purportedly fraudulent transactions, investigators said.
It was also alleged that money was layered through several dummy or non-existent entities before cash withdrawals were made, making it difficult to trace beneficiaries.
The Monday searches were to trace alleged proceeds of crime, to identify other beneficiaries and to secure documentary and digital evidence in connection with the suspected fraudulent ITC network.
Investigators are expected to sift through financial records, transaction trails and digital material seized during the searches to establish how the alleged network operated across various entities.
The searches, which spanned Muzaffarnagar, Ghaziabad and Faridabad geographically, indicated that the investigators were looking at linkages beyond the location of any one business operation.
The Directorate of Enforcement looks into the laundering of proceeds of scheduled offenses, including financial transactions that can be used to hide their origin, under the Prevention of Money Laundering Act.
The tax allegations here pertain to fraudulent Input Tax Credit, and the ED inquiry is whether proceeds derived from that alleged fraud were laundered thereafter.
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ED Raids Could Lead to Further Investigation and Scrutiny
Officials said the searches also seek evidence that could establish the roles of other beneficiaries, including entities that are allegedly used to facilitate circular transactions, fund layering and cash movement.
Jambudwip Exports and Imports could not be immediately contacted for comment on the ED action, and its response to the allegations was not available at the time of publishing.
“The searches alone do not constitute any criminal liability, and the allegations are subject to investigation and proceedings before competent authorities or courts.”
If investigators uncover more links to the alleged GST fraud or laundering network, the investigation could result in more scrutiny of companies, financial accounts and individuals.
The Enforcement Directorate’s searches followed detection of a fraudulent Input Tax Credit of Rs 9.63 crore by tax authorities, and the alleged transactions have now been subjected to a wider financial probe.
The case shows how fake invoices, e-way bills, round-tripping transactions, and layered movements of money can be looked at together when authorities investigate suspected tax-related money laundering.
The searches were conducted to trace proceeds, identify the beneficiaries, and recover documentary and digital evidence related to the alleged network, officials told The New Indian Express.
Sprouts News will continue to track the developments as the Enforcement Directorate analyzes the evidence collected during the searches and decides the future course of action under the law.
