Around Rs 98 crore in demonetised notes has been found in a businessman's house that was raided in Uttar Pradesh's Kanpur, police said on Wednesday.

Counting of the banned Rs 1,000 and Rs 500 notes is on and police said the total amount "could well cross the Rs 100 crore mark".

The big cache of banned notes was recovered from the house of Ashok Khatri, who has interests in real estate, after the National Investigative Agency (NIA) tipped off the Reserve Bank of India (RBI), the Income Tax department and the Uttar Pradesh Police.

Sources say the money belongs to a group of businessmen based in NCR, Kanpur, Lucknow and some other prominent cities and that Khatri was a front who was trying to arrange to launder this money.

Police officials said that 16 persons have been arrested so far, including Khatri, and they were being questioned by various agencies to ascertain the source of the large amount of money.

Additional DG (Law and Order) Anand Kumar said the arrested persons were trying to exchange the money with the new and valid currency. "All people who were acting as the go between have also been arrested," an official said.