KANPUR: Police in Uttar Pradesh have uncovered a ₹2.66 crore GST fraud involving fake firms and fraudulent input tax credit claims, with investigators pointing to an organized network using shell companies and fabricated transactions.
Fraud Case Registered in Kalyanpur
Authorities in the Kalyanpur police jurisdiction have registered a case involving alleged Goods and Services Tax (GST) evasion amounting to approximately ₹2.66 crore. The case, initiated following inputs from GST department officials, has led to the arrest of three individuals so far.
Investigators said two suspects had been apprehended earlier, while a third accused, identified as Deepak, also known as Mongli, was recently arrested and sent to jail. The arrests form part of an ongoing investigation into what officials describe as a coordinated effort to manipulate tax records and claim fraudulent benefits.
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Fake Firm Used to Generate Input Tax Credit
According to the police, the accused created a fictitious entity under the name “Apoorv Trading Company” to facilitate the fraud. Through this firm, they allegedly showed fabricated transactions involving goods such as groundnuts and other commodities.
These transactions were used to generate fraudulent Input Tax Credit (ITC), allowing the accused to claim tax benefits without actual movement of goods. Authorities estimate that the group availed wrongful gains amounting to ₹2.66 crore through this mechanism.
₹2.66 करोड़ की जीएसटी टैक्स चोरी का खुलासा: फर्जी कंपनी बनाकर आईटीसी फ्रॉड करने वाला गिरोह बेनकाब..
▪️थाना कल्याणपुर क्षेत्र में जीएसटी टैक्स चोरी से संबंधित एक मुकदमा पंजीकृत किया गया था, जिसमें लगभग ₹2,66,00,000 की कर चोरी का मामला प्रकाश में आया। जांच के दौरान अब तक कुल 03… pic.twitter.com/jmfhgwz4sr
— POLICE COMMISSIONERATE KANPUR NAGAR (@kanpurnagarpol) March 20, 2026
During the arrest of Deepak, officials recovered documents including Aadhaar cards, PAN cards, and mobile phones, which are now being examined as part of the evidence trail.
Organized Network and Role of Shell Entities
Investigators said the fraud appears to involve an organized network, with multiple individuals working in coordination. Apart from the main accused, several other members allegedly acted as facilitators or associates in executing the scheme.
Officials noted that between five and seven suspicious companies have been identified during the probe. These entities are believed to have been used to create layers of transactions, enabling the generation of fake invoices and ITC claims.
Authorities are also scrutinizing transport records and documentation linked to these firms to determine the extent of the fraudulent activity.
Probe Expands as Key Accused Remains Absconding
Police officials said that further investigation is underway, with a focus on identifying additional individuals and companies linked to the network. Legal action will be initiated against any person or entity found to have used forged documents or participated in the scheme.
During questioning, investigators identified a key figure, Rakesh Sahu, as the alleged mastermind behind the operation. He is currently absconding, with information suggesting that he may be in Jhansi.
Police teams have been deployed to locate and arrest him, while the broader investigation continues to map the full scope of the network and its financial transactions.
