Kerala Opposition Leader Calls for CBI Investigation into Alleged ₹1,100 Crore GST Fraud

In a significant political development, Kerala’s Leader of Opposition, VD Satheesan, has raised serious allegations regarding a massive Goods and Services Tax (GST) fraud amounting to ₹1,100 crore. The alleged scheme reportedly involved a group of fraudsters who registered GST accounts in the names of unsuspecting individuals without their consent. Satheesan is now demanding a thorough investigation by the Central Bureau of Investigation (CBI) to uncover the truth behind this financial scandal.

Allegations of Widespread Fraud

During a press conference held in Thiruvananthapuram, Satheesan detailed the nature of the fraud, claiming that it has resulted in a loss of approximately ₹200 crore to the state treasury. He criticized the Left Democratic Front (LDF) government for its lack of action, stating that officials merely canceled the fraudulent registrations without pursuing further investigations to identify the perpetrators.

“GST registration can be done in anyone’s name. Currently, while doing GST registration, you can provide someone else’s bank account. In this case, while the registrations were carried out in the names of ordinary people, the fraud was committed through the bank accounts of the accused,” Satheesan explained. He emphasized that the tax liabilities would ultimately fall on the innocent individuals whose names were misused.

Background of the Allegations

The details of this alleged fraud first came to light in February 2025, when the GST intelligence department in Pune alerted the Kerala state government. However, according to Satheesan, the state GST department has failed to investigate the matter adequately. He expressed concern that the government has not even informed the victims whose names were exploited in this scheme.

One particularly alarming case involved a contract laborer from Ernakulam district, who discovered ₹43 crore worth of transactions registered in his name while filing an Income Tax return for his daughter’s education loan. This revelation prompted him to file a complaint with the Wadakkanchery police, highlighting the urgent need for action.

Government’s Inaction Under Scrutiny

Satheesan’s allegations raise critical questions about the effectiveness of the GST administration in Kerala. He pointed out that despite the scale of the fraud, the government has only taken minimal steps, such as canceling the fraudulent registrations. “Why has the government not gone further than merely canceling the GST fake registrations? Why has it not informed the victims or provided them with legal protection?” he asked, underscoring the apparent negligence on the part of the authorities.

The Leader of Opposition also criticized the state government for its lack of transparency and accountability. “The GST administration in Kerala is in a deplorable state. Tax evasion is rampant,” he asserted, calling for immediate reforms to prevent such incidents in the future.

Historical Context of GST Fraud in India

The issue of GST fraud is not new to India. Since the implementation of the GST regime in 2017, various instances of tax evasion and fraudulent registrations have been reported across the country. The complexity of the GST system, combined with loopholes in the registration process, has made it easier for fraudsters to exploit the system.

In recent years, the Indian government has taken steps to tighten regulations and enhance monitoring mechanisms to combat GST fraud. However, cases like the one in Kerala highlight the ongoing challenges that authorities face in ensuring compliance and protecting innocent taxpayers.

The Call for CBI Intervention

Satheesan’s demand for a CBI investigation reflects a growing concern among opposition leaders regarding the integrity of the state’s financial administration. The CBI, as a central investigative agency, has the resources and authority to conduct a comprehensive inquiry into such large-scale frauds. By involving the CBI, Satheesan hopes to ensure that the investigation is thorough and impartial, ultimately leading to accountability for those responsible.

The political implications of this situation are significant. As the opposition party seeks to hold the ruling government accountable, the outcome of this investigation could influence public perception and voter sentiment ahead of upcoming elections.

Conclusion

The allegations of a ₹1,100 crore GST fraud in Kerala have raised serious questions about the effectiveness of the state’s tax administration and the government’s commitment to protecting its citizens. As VD Satheesan calls for a CBI investigation, the spotlight is now on the authorities to act decisively and transparently. The outcome of this case could have far-reaching implications for both the political landscape in Kerala and the broader fight against tax fraud in India.