Police have arrested five people, including the alleged kingpin of a syndicate accused of carrying out GST fraud and input tax credit (ITC) manipulation worth more than ₹100 crore through fake firms. The arrested accused have been identified as Sagar Agrawal, Furkan Hashmi, Vineet Arora, Anuj Agrawal and Shivam alias Lala. Investigators allege that the syndicate created fake companies, generated invoices in their names and showed transactions without any actual business activity to claim or transfer bogus ITC.
During the investigation, police found that suspicious financial transactions worth more than ₹100 crore had allegedly been carried out through various firms and bank accounts linked to the syndicate. According to investigators, six more names have emerged during interrogation, and efforts are underway to locate the suspected members who remain at large.
The case came to light last year after GST officials filed a complaint at Kila police station in Bareilly over alleged tax evasion through fake firms. As the investigation progressed, police had earlier arrested Saddam Hussain and Mohammed Samad alias Shah Rukh. Further investigation subsequently revealed the alleged involvement of other members of the network.
Investigators later traced Furkan Hashmi, a resident of Bada Bazaar in the Kila area, who had allegedly fled to Nepal after the case was registered. Police said he was living there under the assumed identity of Sandeep to conceal his identity. Despite being outside India, he allegedly remained in contact with his associates through a messaging application and continued working on the preparation of fake invoices.
During interrogation, Furkan allegedly provided investigators with information about the functioning of the suspected syndicate. Based on the information obtained during the investigation, police identified Sagar Agrawal as the alleged main operator. He is accused of arranging fake firms and facilitating bogus ITC transfers between genuine companies and entities allegedly created for fraudulent transactions.
Investigators also found that Furkan had allegedly disclosed the involvement of Vineet Arora, Anuj Agrawal and Shivam alias Lala in operating an office opposite the DM compound. Police suspect that the office was used to coordinate the chain of fake firms and manage financial transactions linked to them. Following the investigation, police arrested Sagar, Vineet, Anuj and Shivam.
The investigation has also revealed the alleged method used to create fake firms. According to police, the syndicate allegedly approached people willing to allow firms to be registered using their names and residential addresses in exchange for money. Furkan allegedly told investigators that Vineet Arora had advised him to create a fake firm and paid him ₹50,000 for the arrangement. Subsequently, a firm named FS Traders was allegedly registered using Furkan’s residential address.
Police allege that such firms were used to generate invoices without genuine commercial transactions, circulate money through different accounts and claim GST and ITC benefits through allegedly fraudulent means. Investigators are now examining how many such firms were created and which genuine businesses were allegedly used in transactions involving bogus ITC.
The investigation has also indicated specific alleged roles of the accused. Police said Vineet Arora was allegedly responsible for cash settlements, while Anuj Agrawal handled the filing of GST returns for the bogus firms. Shivam alias Lala allegedly handled the movement and disposal of funds and was also responsible for allegedly transferring money through informal channels to beneficiary firms and Sagar Agrawal.
According to police, six other suspected members of the network—Syed Saif, Shajiz, Asif, Tausif, Firoz and Fammi alias Faraz—are currently absconding. Investigators are conducting searches to locate them and determine their respective roles in the alleged GST fraud network.
Police have recovered a laptop, charger, mouse and six mobile phones from the arrested accused. The electronic devices are being examined for evidence related to fake firms, invoices, bank accounts, financial transactions and alleged ITC manipulation. Investigators expect the digital evidence to provide further information about the network and its operations.
Police are now tracing the complete financial trail involving more than ₹100 crore in suspected transactions. The investigation is focused on determining the amount of ITC allegedly claimed through fake firms, identifying the accounts through which the money moved and establishing the identities of the ultimate beneficiaries.
The case has highlighted how networks using shell firms and fabricated invoices can allegedly create layers of transactions to manipulate the GST system. With six suspected members still absconding and the financial trail under examination, investigators are continuing efforts to uncover the complete structure of the alleged syndicate. Further arrests are likely as the investigation progresses.
