3 held in Hardoi for Rs 16 crore GST fraud

Lucknow: Hardoi Police on Saturday busted a racket orchestrating a GST fraud using fake firms and fraudulent input tax credit (ITC) claims worth Rs 16.5 crore. The gang allegedly created shell companies and showed fictitious purchase and sale transactions on paper to evade taxes. The case was registered on June 24 last year at Kotwali City police station on a complaint filed by state tax department deputy commissioner Ravindra Kumar. Three people arrested in this regard on Saturday were granted bail by a local court. Investigations revealed the accused registered bogus firms in Hardoi using forged documents.Officials said one such firm, Ali Enterprises, was registered in Hardoi on Jan 1, 2024, purportedly for garment business. Scrutiny of GST filings revealed that in Mar 2025, the firm showed fake purchases worth Rs 66.6 crore from a Ghaziabad-based firm and fraudulently claimed ITC worth Rs 16.5 crore.Further probe found that neither actual goods were supplied, nor any tax deposited.The probe also exposed involvement of other firms indicating a wider network of fake billing and tax evasion.Police said the arrested persons created a chain of fictitious transactions across multiple firms to illegally claim ITC benefits, causing substantial loss to the exchequer.