BHOPAL: The Madhya Pradesh State Economic Offences Wing (EOW) has arrested two more suspects in connection with a massive Goods and Services Tax (GST) evasion and fake invoicing racket, taking the total number of arrests in the case to three. The newly arrested individuals have been identified as Sheikh Zafar from Anuppur and Raja Sheikh from Bhopal. The alleged kingpin, Vinod Sahay alias NK Khare, was taken into custody earlier.
The case, registered as EOW Case No. 102/25, involves the generation of fake invoices worth ₹512 crore and fraudulent Input Tax Credit (ITC) claims amounting to ₹134 crore. The scam was executed through a web of shell companies and fictitious business transactions, resulting in massive losses to the exchequer over the years.
According to EOW officials, Sheikh Zafar ran two fake firms—Amber Coal Depot and Anam Traders—under the instructions of Sahay. Though non-operational, these entities were shown to have engaged in business with other shell companies like Maa Reva Traders, Namami Traders, and Abhijeet Traders, all of which are reportedly linked to the main accused.
These fake businesses were used to simulate coal supply transactions to major thermal power companies such as MSP Power, B.S. Sanjhe Power, and Prakash Industries. The transactions were backed by fabricated documentation, including invoices, e-way bills, truck registration numbers, and weight slips—despite no actual supply of goods.
Zafar was apprehended in Bilaspur on July 2, 2025, and has been remanded to police custody until July 7 for further interrogation.
The second accused, Raja Sheikh, owner of Mehak Enterprises, was arrested in Bhopal on July 1, 2025, and subsequently sent to judicial custody the following day. Investigations revealed that Raja had faked cement transactions worth ₹6 crore in collaboration with shell firms under Sahay’s control, such as Abhijeet Traders, Namami Traders, and Ankita Steel & Coals, to illegally claim ₹1.20 crore in ITC.
Searches at Raja Sheikh’s premises led to the seizure of official seals belonging to other suspicious firms and a cache of incriminating documents, further strengthening the case.
Authorities say the investigation is ongoing and more arrests are likely as the EOW continues to unravel the vast network of fake firms and bogus transactions that underpin the scam.
