Bareilly (UP), Jan 6 (PTI) Police in Uttar Pradesh’s Bareilly district have uncovered a suspected hawala and GST fraud network involving illegal financial transactions worth around Rs 24 crore, with the arrest of two men who allegedly used fake firms and so-called “mule accounts” to move money, officials said on Tuesday.
The racket surfaced after a small zari (embroidery) artisan received an income tax notice of nearly Rs 1.5 crore for transactions he was unaware of, Bareilly Superintendent of Police (South) Anshika Verma said on Monday.
According to police, the accused targeted small traders and daily wage workers, offering to help them expand their businesses or enter export markets.
They allegedly obtained identity documents such as Aadhaar and PAN cards, opened bank accounts in their names and floated shell companies, which were then used for large-scale unauthorised transactions, the police said.
Verma said investigations revealed that a fake firm — Satya Sahab Traders — was created in the name of the artisan and bank accounts were opened in private and public sector banks.
“About Rs 24 crore in suspicious transactions were routed through this firm within a year,” she said.
Police also found that several other firms, including Mahavir Trading Company, Mahakal Traders and Sumit Traders, existed only on paper and were used to generate fake bills and invoices to evade GST.
“At first glance it appears to be a GST fraud, but the movement of funds suggests the possible involvement of a hawala network,” the SP said, adding that a man from neighbouring Shahjahanpur district is also under investigation.
The two accused, identified as Shahid Ahmed (38) and Amit Gupta (38), were arrested from the Bhuta area of Bareilly. Several mobile phones and cash were recovered from their possession, the police said.
A case has been registered under relevant sections of the Bharatiya Nyaya Sanhita and other laws, and further investigation is underway to identify additional beneficiaries and links in the network, they added. PTI COR KIS NB
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