On August 24, 2026, the ED’s Lucknow Zonal Office conducted search operations under the provisions of the PMLA, 2002, at 11 premises across Uttar Pradesh and Haryana. These operations were linked to the utilization and transfer of fake Input Tax Credit (ITC) without the actual supply of goods or services. During the searches, incriminating documents and digital devices were recovered and seized, alongside evidence of fraud amounting to ₹3.80 crore.
The Directorate of Enforcement (ED), Lucknow Zonal Office conducted searches on 24.08.2026 under the provisions of the Prevention of Money Laundering Act (PMLA), 2002 at 11 premises located in the States of Uttar Pradesh and Haryana in connection with the transfer and utilisation of fake Input Tax Credit (ITC) without actual supply of goods/services.
The ED initiated an investigation into the case based on an FIR registered by the Uttar Pradesh Police under various sections of the Indian Penal Code, 1860; these sections are scheduled offenses under the PMLA, 2002. The prosecuting agency alleges that the accused company and its directors fraudulently availed and passed on input tax credit based on forged invoices and fake e-way bills, without any actual supply or receipt of goods, causing an undue loss of ₹27.02 crore to the government exchequer. It further stated that the company, as part of a pre-planned scheme, prepared fake bills (transport receipts) with the intention of availing fake input tax credit and thereby causing loss to the government revenue. The investigation revealed that during the financial year 2018-19, the company availed and passed on fake input tax credit worth approximately ₹10.28 crore through a series of non-existent and fictitious companies. Additionally, the funds received from the companies that benefited were transferred to similar shell companies on the same day; this money was circulated through a network of accounts and finally withdrawn in cash.
Documents recovered during the searches were analyzed and statements were recorded from key individuals, including beneficiaries, which revealed that the fraudulent ITC (Income Tax) network extended to several other such entities. Additionally, unaccounted cash of ₹3.80 crore, along with incriminating documents and digital devices, were recovered and seized.
Further investigation is ongoing.
Radhika Goyal is Author of Taxconcept Gurugram head office, for deeply reported tax, gst and income tax articles on issues that matter. He splits her time between New Delhi and Bengaluru, and has worked as a reporter, a podcaster and an editor for publications across India.