Fake Invoices and Bogus ITC Used in ₹100 Crore GST Fraud, Five Held

Bareilly: Police have arrested five people in connection with an alleged GST fraud network suspected of using fake firms, fabricated invoices and bogus input tax credit (ITC) transactions involving more than ₹100 crore.

The arrested accused have been identified as Sagar Agrawal, Furkan Hashmi, Vineet Arora, Anuj Agrawal and Shivam alias Lala. Investigators allege that the group created or operated firms with little or no genuine business activity and used them to generate invoices and route transactions for alleged tax and ITC manipulation.

Police are also looking for six other suspected members of the network who remain absconding.

Investigation Began With GST Complaint

The case originated from a complaint filed by GST officials at Kila police station in Bareilly last year over suspected tax evasion involving allegedly fraudulent firms.

During the initial investigation, police arrested Saddam Hussain and Mohammed Samad alias Shah Rukh. Subsequent questioning and examination of the financial trail reportedly helped investigators identify additional people allegedly connected with the network.

Authorities are now attempting to establish the full scale of the suspected operation and identify the ultimate beneficiaries of the transactions.

Suspect Allegedly Operated From Nepal

Investigators traced Furkan Hashmi, a resident of Bada Bazaar in the Kila area, who allegedly left India after the case was registered and travelled to Nepal.

Police said he was living there under the assumed identity of Sandeep and allegedly remained in contact with associates through a messaging application. Investigators allege that he continued assisting with the preparation of invoices linked to the suspected fraudulent firms.

According to police, information obtained during questioning helped investigators identify Sagar Agrawal as the alleged key operator of the network.

Fake Firms Allegedly Used to Generate Invoices

Police allege that Sagar Agrawal arranged firms that were subsequently used for transactions involving purportedly bogus ITC.

Investigators also identified the alleged involvement of Vineet Arora, Anuj Agrawal and Shivam alias Lala. According to police, the three allegedly operated from an office located opposite the DM compound, which investigators suspect was used to coordinate the network’s activities.

All four were subsequently arrested.

Residential Addresses Allegedly Used for Shell Firms

Investigators suspect that the syndicate recruited people willing to have firms registered in their names and at their residential addresses in return for payments.

According to police, Furkan allegedly told investigators that Vineet Arora encouraged him to establish a firm and paid him ₹50,000 for the arrangement. A firm called FS Traders was subsequently registered using Furkan’s residential address, police allege.

Authorities are now investigating how many similar firms were created and whether their registrations were used to generate invoices without genuine commercial activity.

Suspects Allegedly Had Different Roles

Police have attributed different responsibilities to the arrested individuals as part of their preliminary investigation.

According to investigators, Vineet Arora allegedly handled cash settlements, while Anuj Agrawal was responsible for filing GST returns associated with the firms under investigation.

Shivam alias Lala allegedly managed the movement of funds and helped transfer money through informal channels to beneficiary businesses and Sagar Agrawal.

Investigators are continuing to verify these alleged roles through financial records and digital evidence.

Six Suspected Members Still Absconding

Police have identified six additional suspects who are currently reported to be absconding. They are Syed Saif, Shajiz, Asif, Tausif, Firoz and Fammi alias Faraz.

Searches are underway to locate the suspects and determine their alleged involvement in the wider network.

Authorities are also examining whether other businesses and individuals may have benefited from transactions involving the suspected bogus ITC.

Electronic Devices Seized

Police have recovered a laptop, charger, mouse and six mobile phones from the arrested accused.

The devices are being examined for evidence relating to company registrations, invoices, bank accounts, communications and financial transactions. Investigators expect the digital examination to help establish links between the suspects and firms allegedly used in the scheme.

₹100 Crore Financial Trail Under Examination

A major focus of the investigation is the financial trail involving transactions valued at more than ₹100 crore.

Police are examining bank accounts and other financial records to determine how funds moved between the suspected firms, how much ITC was allegedly generated or transferred without genuine transactions and who ultimately benefited.

The investigation is also expected to establish the number of companies allegedly created for the scheme and whether legitimate businesses were knowingly or unknowingly involved.

The five arrested individuals are accused in the case, and the allegations remain subject to investigation and legal proceedings. With several suspects still at large and the financial trail continuing to be examined, police are expected to take further action as additional evidence emerges.