New Delhi, December 9, 2025 – The Indian government has reported the detection of 55,813 cases of Goods and Services Tax (GST) evasion, amounting to a staggering ₹1.6 lakh crore, over the past three years and seven months. This information was shared with the Parliament on Tuesday by Minister of State for Finance Pankaj Chaudhary.
The detected GST evasion cases primarily involve Input Tax Credit (ITC) fraud, where bogus or dummy entities are used as fronts for fake invoicing. These fraudulent practices lead to significant revenue losses for the government and create an uneven playing field for honest businesses.
Providing a breakdown for the current financial year up to October, Chaudhary stated that 24,109 cases of tax evasion, with a financial implication of ₹41,664 crore, have already been detected. Furthermore, tax authorities uncovered 15,283 cases of ITC fraud, involving a financial implication of ₹58,772 crore, during the financial year 2024-25.
The government has been actively taking measures to prevent and tackle fake invoicing and ITC fraud. These measures include making the electronic invoicing system (e-invoice) mandatory for all Business-to-Business (B2B) transactions for businesses with a turnover exceeding ₹5 crore. Additionally, physical verification is now required in high-risk cases, even when Aadhaar authentication has been completed.
To further combat GST evasion, the central and state tax administrations launched two special drives on an all-India basis. The first drive took place from May 16, 2023, to August 14, 2023, and the second from August 16, 2024, to October 30, 2024. These drives aimed to take concerted and coordinated action against fake registrations and fraudulent passing of ITC.
The special drives involved physical verification of business premises by tax officials to identify and suspend or cancel non-existent GSTINs.
In response to another query, Chaudhary explained that the GST reforms recommended by the 56th GST Council on September 3, 2025, are designed for a strategic, principled, and citizen-centric evolution of the tax framework.
The government's efforts to curb GST evasion include digitization through e-invoicing, GST analytics, highlighting outliers based on system-flagged mismatches, providing actionable intelligence, and selecting returns for scrutiny and taxpayers for audits based on risk parameters. Initiatives like "Project Anveshan," which utilizes technologies like Facial Recognition Systems and e-way bill data analysis to identify GSTINs at high risk of fraud, have also been introduced.
In the last five financial years (2020-21 to 2024-25), the total GST evasion detected stood at ₹7.08 lakh crore in 91,370 cases. This includes ₹1.79 lakh crore of ITC fraud in 44,938 cases. Over this period, ₹1.29 lakh crore has been recovered through voluntary deposits.
