"Mohabat Hussain (28) and Zafar Iqbal (30) were picked up last evening on suspicion from Ritahura Bazar last evening," Additional Superintendent of Police Brijesh Srivastava said.
He said that though the youth claimed to have come to Bareilly for collecting donation for madraasa, but they transferred Rs 11,000 in an account which raised suspicion.
The ASP said that a hand written identification of Poonch district and a mobile phone was found from their possession.
Srivastava said that the youth were being quizzed by the intelligence units along with the local police and their call details were being checked.
Earlier, on January 7, two youths selling warm clothes were picked up while they were showing the clothes to a shopkeeper by the Izzatnagar police and were questioned.
However, they were released later.