Chennai: A 34-year-old man was arrested while trying to escape the country for his alleged involvement in a fraudulent scheme involving fake input tax credit, media reports said.

Under the scheme the accused created fictitious companies under the names of underprivileged individuals in Chennai and issued false invoices, resulting in a government loss of Rs 176 crore.

According to the Goods and Services Tax (GST) Intelligence Unit, the suspect and his associates obtained the Aadhaar and PAN details of poor people by offering them bank loans, subsequently establishing numerous fictitious companies using their identities.

"Many companies had engaged this alleged mastermind, who had created fictitious companies and raised invoices to the tune of Rs 175.88 crore for a taxable value of Rs 973.64 crore," an official from the GST Intelligence Unit in Chennai was quoted as saying by NDTV.

Following the arrest of an accomplice on June 22, the alleged mastermind was apprehended the following day at Bengaluru airport while attempting to flee the country.

The arrest took place based on information provided by the associate during interrogation.

According to officials, the fraudsters involved in the racket used calculated means to carry out their fraudulent activities like remote access software, using foreign SIM cards, and possessing exclusive phones.

However, the intelligence unit was able to apprehend them by employing techniques like IP address tracking, analysing cryptic WhatsApp conversations, and conducting coordinated searches at multiple locations.

Action has been taken against the fraudulent individuals involved in the racket, the GST Intelligence Unit.

As many as 25 bank accounts linked to the fraud have been frozen, 20 GST registrations associated with the fictitious companies have been cancelled, and various items including mobile phones, modems, laptops, and SIM cards have been seized as evidence.