ED Conducts Searches at 11 Locations in UP and Haryana Over Alleged ₹27 Crore Fake ITC Fraud
The Enforcement Directorate (ED), Lucknow Zonal Office, conducted search operations on August 24, 2026, at 11 premises across Uttar Pradesh and Haryana in connection with an alleged fraud involving the fraudulent generation and transfer of fake Input Tax Credit (ITC) without any actual supply of goods or services.
The searches were carried out under the Prevention of Money Laundering Act (PMLA), 2002. The ED initiated its investigation based on an FIR registered by the Uttar Pradesh Police under various provisions of the Indian Penal Code, 1860, which are scheduled offences under the PMLA.
According to the allegations in the police case, the accused company and its directors fraudulently availed and passed on ITC using fabricated invoices and forged e-way bills, despite there being no actual movement, supply or receipt of goods. The alleged transactions caused a wrongful loss of approximately ₹27.02 crore to the government exchequer.
The complaint also alleged that forged transport documents, commonly known as bilties, were deliberately prepared as part of a planned arrangement to generate fake ITC and cause losses to government revenue.
The ED’s investigation has revealed that the company allegedly availed and passed on fake ITC worth approximately ₹10.28 crore during the financial year 2018-19 through a chain of non-existent and bogus entities.
Investigators found that funds received from beneficiary firms were transferred to other entities on the very same day. The money was allegedly routed through multiple bank accounts to create layers in the financial trail before being withdrawn in cash.
During the search operations, officials examined recovered documents and recorded statements of key individuals, including beneficiaries. Their statements and the material collected during the searches reportedly revealed that the suspected fake ITC network extended to several other units.
The ED also recovered and seized unaccounted cash amounting to approximately ₹3.80 crore, along with documents and digital devices considered relevant to the investigation.
Further investigation is underway to identify other entities and individuals allegedly involved in the fake ITC network and trace the movement of the funds.
News Source : Directorate of Enforcement (ED) – Official Press Release, Government of India
