Punjab Targets Bogus Billing Networks
Chandigarh – In a major escalation of its anti-evasion campaign, Punjab Finance, Planning, Excise and Taxation Minister Advocate Harpal Singh Cheema on Monday revealed that the state has unearthed a massive bogus billing scam worth ₹385 crore. The fraudulent transactions led to tax evasion estimated at ₹69.57 crore.
According to Cheema, the Punjab Taxation Department has registered two separate FIRs against seven individuals and companies for their role in large-scale fake invoicing and wrongful availment of Input Tax Credit (ITC). The crackdown is part of the state’s zero-tolerance approach toward tax evasion, which officials say directly impacts Punjab’s revenue base and welfare spending.
Details of the First FIR
The first FIR, filed on September 12, 2025, focuses on M/s Rajdhani Iron Products Pvt. Ltd. and its directors, Manish Garg and Rythem Garg. Investigations revealed that the firm, in association with bogus entities like M/s Mahalakshmi Traders and M/s Shiv Shakti Enterprises, engaged in fake billing practices.
A physical verification of their declared business addresses showed that many were either closed or nonexistent. This confirmed that the firms were shell entities created to facilitate fraudulent ITC claims. The investigation uncovered fraudulent transactions worth ₹310 crore, leading to a tax evasion of ₹55.93 crore. The FIR was lodged with the Senior Superintendent of Police, Fatehgarh Sahib.
Second FIR Against K K Industries
In another significant case, the Taxation Department filed an FIR on September 9, 2025, against M/s K K Industries and its associates, Chandan Singh, Amandeep Singh, and Mukesh. The company was accused of issuing fake invoices without any actual movement of goods.
Investigators cross-verified GST returns and e-way bill records before conducting on-ground checks. The evidence showed that the firm’s transactions were fraudulent, amounting to ₹75 crore, which resulted in tax evasion of ₹13.64 crore.
Cheema said such practices not only defraud the state exchequer but also create unfair competition for genuine businesses.
FIR on Passing of Unaccounted Goods
In addition, FIR No. 182 was registered on September 14, 2025, in Bathinda against Deepak Singla and Vivek Singla. The two were found to be passing iron and steel goods without proper billing. Authorities said this practice was enabling large-scale tax evasion and depriving the state of rightful revenue.
Cheema confirmed that the Bathinda case highlighted how unaccounted goods were being moved in high-risk sectors like iron and steel, making them priority targets for enforcement.
Statewide Enforcement Drive
Beyond these FIRs, Punjab has stepped up ground-level checks. In a three-day enforcement operation at Mandi Gobindgarh, State Investigation and Preventive Units (SIPUs) detained 108 vehicles for inspection.
Of these, 26 vehicles were penalized, leading to a recovery of ₹50 lakh in fines. Proceedings against the remaining vehicles are ongoing. The drive targeted sectors considered high-risk for evasion, such as cement, iron and steel, and auto parts.
Cheema said the exercise sent a strong signal that tax evasion will not be tolerated, adding that the government is determined to protect honest taxpayers and ensure fair competition.
Punjab’s Zero-Tolerance Approach
Addressing the press, Cheema reiterated Punjab’s commitment to safeguarding its revenue base. “The FIRs and large-scale enforcement drives demonstrate the seriousness of the state in protecting its resources,” he said.
He highlighted that the government’s strategy combines technology-driven monitoring with physical verification on the ground. According to him, deterrent actions against fraudulent firms will continue with greater intensity.
“Punjab is committed to encouraging genuine business practices, protecting honest taxpayers, and ensuring public revenue is fully protected for welfare,” Cheema added.
Wider Implications
Experts note that bogus billing not only drains state resources but also distorts markets by giving fraudulent traders an unfair advantage. Punjab’s stepped-up action is expected to serve as a warning to evaders in other high-risk sectors.
The Finance Minister said the crackdown forms part of the government’s broader reforms to improve transparency and compliance. He assured that honest traders would face no harassment, but those attempting to evade taxes would be dealt with firmly.