CHANDIGARH, August 5 — In a major move to institutionalise tax enforcement, Punjab Finance and Taxation Minister Harpal Singh Cheema on Monday announced the formation of a State-Level Special Fraud Detection Unit (SFDU) to crack down on Goods and Services Tax (GST) violations. The unit will be headquartered in Patiala and focus on unearthing complex tax frauds through a data-driven and technology-backed approach.
“The SFDU will investigate high-value GST frauds, dismantle circular trading networks, identify benami transactions, and curb the use of fake invoices,” Cheema said. “It will also be empowered to initiate enforcement actions such as cancelling suspicious GSTINs, blocking fraudulent input tax credit (ITC) claims, and recommending prosecution where necessary.”
To enhance efficiency and accuracy in enforcement, the unit will leverage advanced tools such as artificial intelligence, data analytics, and centralised backend systems. It will analyse transaction networks, movement of goods, and tax return filings to identify patterns and anomalies that indicate potential fraud.
The minister emphasised that the SFDU will operate on a selective enforcement model. “Only suspicious and non-compliant taxpayers will be targeted. Honest taxpayers will not face unnecessary scrutiny,” Cheema noted, adding that the move is aimed at balancing strict enforcement with ease of compliance.
The SFDU will be composed of a multidisciplinary team, including seasoned tax officers, IT experts, a chartered accountant, and a legal officer. They will be equipped with real-time access to critical datasets such as GSTN information, e-way bill tracking systems, toll booth records, and RFID-based trail analytics.
Cheema further said that the unit will draw its powers from the Central and Punjab GST Acts—specifically Sections 67, 70, 74, and 132—along with relevant provisions of the Indian Penal Code (IPC).
“This is a significant step toward strengthening tax governance and creating a deterrent against organised tax evasion in Punjab,” the finance minister said.
