Thiruvananthapuram/ Thrissur: The State Goods and Services Tax (GST) Department has uncovered a turnover fraud of over ₹100 crore during a massive inspection codenamed Operation Arkenstone. The raids, began on August 26 and concluded the next day, targeted jewellery businesses in Thrissur.

Arkenstone, a legendary jewel from J R R Tolkien’s The Hobbit, is described as the “heart of the mountain” and a symbol of the dwarven kingdom.

More than 200 officers from the GST Intelligence and Enforcement Wing carried out simultaneous searches at 42 locations linked to 16 jewellers, including their business premises and residences. The raids led to the seizure of over 36 kilograms of unaccounted gold.

Preliminary proceedings have already recovered over ₹2 crore in tax arrears and ₹3 crore in penalties. GST Additional Commissioner said further action would follow against those involved in evasion.

This is the second major crackdown on Thrissur’s jewellery sector in less than a year. In October 2024, during Operation Torre del Oro (“Tower of Gold”), the department seized 105 kg of unaccounted gold in raids across 73 premises connected to 35 jewellery owners and manufacturers. That action drew sharp criticism from merchants, who accused the authorities of targeting Kerala’s traditional gold ornament sector and attempting to tarnish its reputation.