Gandhinagar, May 24 (IANS) Aravalli District Congress President Arun Patel has been arrested by Gandhinagar Police in connection with a multi-crore investment fraud case involving Shoutspace Digital Private Limited, marking the latest development in an alleged financial scam centred on “terabyte space” investments that investigators say misled many investors across Gujarat.
According to the police on Saturday, the case originated from operations conducted at WTC Complex in Ratanpur village under Dabhoda police station limits, where the firm had set up an office claiming to offer data storage space as an investment product.
Investors were allegedly promised fixed monthly rental returns for up to 84 months in exchange for purchasing “terabyte space”.
Officials said the company issued digital agreements, circulated misleading advertisements, and displayed fabricated profit projections to attract investment, despite not having adequate server infrastructure for large-scale data storage.
Investigators said that investors were assured regular returns similar to interest or dividend income offered by regulated financial institutions, but payments were later stopped.
Police said the accused created false invoices and used them as genuine financial documents to collect funds.
A portion of the money was allegedly routed to associated entities, including Cloudji Digital Private Limited and Hari Hospitality and Leisure Limited, as part of a broader diversion mechanism.
The complainant in the case alleged that he and his family were induced into investing Rs 32.75 lakh for 84 terabytes of space after being offered assurances of fixed rental income and other inducements, including foreign travel incentives.
Police said around Rs 20.97 lakh was initially paid as rental and commission between February 2025 and March 2026 before payments ceased.
Investigators also identified at least 12 other investors, with total alleged losses reported at about Rs 4.90 crore, while officials believe the overall exposure may be significantly higher.
A case has been registered at Dabhoda Police Station under Sections 396(5), 318(4), 336(2)(3), 338, 340(2), 61(2) of the Bharatiya Nyaya Sanhita, 2023, as well as Section 3 of the Gujarat Protection of Interest of Depositors Act, 2003, and Sections 21 and 23 of the Banning of Unregulated Deposit Schemes Act, 2019.
Police said a Special Investigation Team (SIT) was formed under senior supervision following instructions from the Gandhinagar Range Deputy Inspector General, Virendra Singh Yadav, to trace those involved in the scheme and recover diverted funds.
The SIT subsequently arrested Arun Patel, identified as a board director of Cloudji Digital Private Limited, and Sachin Patel, a zonal manager of Shoutspace Digital Private Limited.
Patel is linked to one of the associated companies under investigation.
Officials said his involvement and responsibilities are under further examination as part of the ongoing investigation.
–IANS
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