Two Held in Bareilly for ₹16.26 Crore Fake-Firm GST Fraud Racket

Police in Bareilly have arrested two individuals in connection with an alleged fake GST billing racket involving a shell company accused of generating fraudulent invoices and causing a loss of more than ₹16.26 crore to the government exchequer.

The arrests were made following an investigation by the State Tax Department into suspected misuse of the Goods and Services Tax (GST) system through a firm that allegedly existed only on paper and had no genuine business operations.

Fake Firm Allegedly Created for Bogus Transactions

The accused have been identified as Himanshu Kumar, a resident of Bihar’s Arwal district, and Kunwar Sanoj Maurya, originally from Kasganj and currently living in Bareilly.

According to officials, the investigation began after a complaint filed by Gaurav Singh, Assistant Commissioner of the State Tax Department, alleging that a firm named Him Traders was created using fraudulent documents and used to issue fake tax invoices.

Investigators claim that the company did not conduct actual trade activities but generated false billing records to facilitate the wrongful transfer and claiming of Input Tax Credit (ITC). The alleged fraudulent ITC amount involved in the case is estimated at ₹16,26,62,609.

Accused Allegedly Operated Commission-Based Billing System

After registration of the case, Bareilly Senior Superintendent of Police Anurag Arya formed a Special Investigation Team (SIT) to investigate the suspected GST fraud network.

Police officials said the accused were arrested during an operation near Nainital Road based on intelligence inputs. During questioning, Himanshu Kumar allegedly stated that he had been operating Him Traders since 2019 after being approached by a person identified as Humer alias Mubarak Khan.

Investigators allege that Kumar received payment to allow his identity and documents to be used for running the fake firm.

Police further claim that Kunwar Sanoj Maurya was involved in preparing and arranging fraudulent GST invoices for different entities and received commissions for facilitating the transactions. Authorities are also examining his previous criminal cases related to alleged cheating and forgery.

Digital Evidence and Financial Records Under Review

Following the arrests, police recovered mobile phones, identity documents, and banking-related records. These materials are being examined to trace the movement of funds and identify other individuals who may have participated in the alleged fraud.

Investigators are also looking into whether the accused created or operated additional shell companies to carry out similar fraudulent billing activities.

The SIT is analyzing transaction records, GST filings, and financial links to determine the full scope of the network.

Bareilly Emerges as a Key Focus Area in Fake GST Investigations

Authorities have reported several cases of fake GST firms and bogus invoice networks in Bareilly in recent months. Investigators say such operations often involve individuals providing identity documents for registration of fake businesses, while others manage billing and financial transactions.

Officials believe many such networks operate through a structured system in which fake firms are created, invoices are generated without actual supply of goods, and fraudulent ITC claims are processed.

The ongoing investigation is focused on identifying the alleged mastermind behind the network and determining whether similar firms were created elsewhere.

Police have indicated that further arrests may follow as financial records and digital evidence reveal more details about the suspected operation.