mr sunil, first you find whether your friend did any criminal act or not. if one of the party having spouse, then it may be a criminal act us 494 or 497 of ipc.
"3. they are in Prohibited relition as per HMA." - Prohibited relition as per HMA is
'5. Conditions for a Hindu marriage.
5. A marriage may be solemnized between any two hindus, if the following conditions are fulfilled, namely:-
(iv.) the parties are not within the degrees of prohibited relationship unless the custom or usage governing each of them permits of a marriage between the two;
(v) the parties are not sapindas of each other, unless the custom or usage governing each of them permits of a marriage between the two.'
if you are telling about this relationship, and niether party having a living spouse, your this relationship is not a marriage and void one. it will not effect much more, it is not a criminal act.
but it is safe that, not to decleare themselves as husband and wife. giving false information by affidevit is penal offence. you both prepare ration card showing you as bachellor.no problem for it. everywhere you show you are bachelor and living in the same address. no body will touch you including police, court, and other govt.officials. but do not write a lie, which is easily proovable. you can easily open a joint bank account showing the same residencial address.
if anybody ask, you just tell that, yes we are staying together.