The Enforcement Directorate (ED) on Monday conducted searches at nine premises in Uttar Pradesh and Haryana as part of a money-laundering investigation into an alleged bogus Input Tax Credit (ITC) network. The searches were carried out by the agency's Lucknow Zonal Office under the provisions of the Prevention of Money Laundering Act (PMLA), 2002, covering locations in Muzaffarnagar and Ghaziabad in Uttar Pradesh and Faridabad in Haryana. According to officials, the case involves an alleged fraudulent ITC scheme worth nearly ₹19.91 crore. 

What ED investigation found

The investigation stems from alleged fraudulent transactions involving an import-export company. According to the findings cited by the authorities, the entities involved allegedly generated and transferred bogus ITC using fabricated invoices and e-way bills without any actual movement of goods. The suspected network allegedly used multiple fictitious and non-existent entities to create the appearance of genuine commercial transactions. 

Officials said the alleged fraud involved the fraudulent availment of ₹9.63 crore in ITC, while another ₹10.28 crore was allegedly passed on through the network. The combined amount represents the alleged wrongful loss to government revenue under the transactions being investigated. The ED is treating the proceeds linked to the alleged activity as proceeds of crime under the PMLA. 

Money trail under scrutiny

Investigators are examining financial records, digital material and other documents recovered during the searches to establish the flow of funds and identify people or entities that may have benefited from the alleged transactions. The suspected modus operandi involved circular transactions and layering of funds through several entities, followed by withdrawals or transfers, according to officials. 

Bogus ITC cases generally involve invoices being issued or circulated without a corresponding supply of goods or services, allowing entities to claim or pass on tax credit that is not backed by genuine business activity. The ED has previously investigated similar networks involving fictitious entities created specifically for the generation and circulation of fraudulent ITC. 

Probe continues

The latest searches are part of the ED's investigation into the money-laundering aspects of the alleged tax fraud. The agency's broader enforcement activity under the PMLA includes cases involving fraudulent ITC utilisation and layering of funds through shell or non-existent entities. 

The investigation is continuing, and further action will depend on the evidence gathered during the searches and the subsequent tracing of the alleged money trail. At this stage, the allegations remain subject to investigation and any further proceedings that may follow under applicable law.

Traffic restrictions have come into force across parts of Delhi and Uttar Pradesh as the annual Kanwar Yatra began on Thursday with the start of the Shravan month, bringing thousands of devotees onto major roads leading towards Haridwar. Authorities expect more than four crore pilgrims to visit Haridwar during the pilgrimage period, prompting extensive security and traffic arrangements across the region. Every year, Kanwariyas travel from different states to Haridwar and nearby areas to collect holy water from the Ganga before carrying it back, often on foot, to Shiva temples in their hometowns and villages for jalabhishek. With the movement of devotees increasing, Delhi Police has deployed personnel at key locations and warned commuters about possible congestion and diversions. According to a traffic advisory issued on July 30, vehicle movement is expected to be affected on several roads in Delhi's western range because of Kanwariya movement and Kanwar camps. The affected stretches include Najafgarh Firni Road, Rohtak Road, Pankha Road, Dev Prakash Shastri Marg, Nangloi-Najafgarh Road and Outer Ring Road.

Restrictions are more extensive across western Uttar Pradesh, where authorities have introduced traffic diversions in phases. The changes are expected to affect people travelling between Delhi, Haridwar, Dehradun and Saharanpur, with longer journey times possible because of alternative routes. In Ghaziabad, police have implemented a phased diversion plan running from July 29 to August 12. Heavy goods vehicles entering Ghaziabad from Delhi have already been restricted and are being diverted through routes including the Eastern Peripheral Expressway, Ganga Expressway and Delhi-Dehradun Expressway. Security arrangements have also been stepped up in other districts along the Kanwar route. Bareilly has deployed more than 3,900 police personnel and divided the district into three super zones, nine zones, 28 sectors and 104 sub-sectors for better monitoring. Across the Meerut zone, around 25,000 police personnel have been deployed. Nearly 7,000 AI-enabled CCTV cameras, temporary police posts, barricades and integrated command centres have also been put in place. Medical facilities and relief teams have been positioned near important ghats, while liquor shops and non-vegetarian eateries have been cleared from the pilgrimage route, according to the information provided.

The biggest restrictions will be seen on the Delhi-Haridwar National Highway as the pilgrimage gathers pace. Muzaffarnagar SSP Sanjay Kumar said heavy vehicles would be barred from key routes beginning July 30. From August 4, all traffic is scheduled to be prohibited on the Delhi-Haridwar National Highway and the Ganga canal road in Muzaffarnagar, making advance route planning important for commuters. Vehicles travelling from Haridwar and Saharanpur towards Delhi will be diverted through Deoband, Pachenda, Mirapur and Mawana in Meerut before proceeding towards the national capital. Vehicles travelling in the opposite direction will use the same alternative route. Those heading from Delhi towards Haridwar or Dehradun can use the Delhi-Dehradun Economic Corridor, where authorities will discourage Kanwariyas from travelling so that regular traffic can continue. Emergency services will remain exempt from the broader restrictions. Ambulances and other emergency vehicles will be permitted to travel through restricted stretches under police escort. With the Kanwar Yatra continuing into August, commuters travelling through Delhi, Ghaziabad, Meerut, Muzaffarnagar and towards Uttarakhand may need to account for diversions, congestion and additional travel time until the pilgrimage concludes.