I-T dept detects tax evasion, blackmoney after raids at multiple locations

It alleged that the evidence acquired relates to the group’s development of “unaccounted money” through unaccountable cash sales, unaccounted cash expenditures, purchases from fictitious parties, under-reporting of actual production, cash scrap purchases, and multiple papers of land acquisitions and sales.

The Central Board of Direct Taxes (CBDT) said in a statement that it had discovered the use of unaccounted income in the form of unsecured loans and the selling of shares in shell firms through stacking of unaccounted income.

“A substantial quantity of property documents related to one of the group’s members have also been confiscated, showing land and property holdings in several names,” it added.

According to the statement, the overall value of such “incriminating evidences” belonging to the manufacturing group surpasses 700 crore.

A total of Rs. 20 lakh in unaccounted cash was confiscated, while two lockers remained unopened, according to the statement.

According to the report, an accommodation entry provider who engages in illegal payment transfers through bank accounts was also raided.

“Incriminating records referring to providing accommodation entries through ways such as sale of shares of shell companies, unsecured loans from shell firms, and bogus billing have been discovered from his secret back office,” it claimed.

It alleged that the entire sum was in the hundreds of crores of rupees.

The board stated that about 200 companies/entities with over 200 bank accounts were discovered to be managed from the entry operator’s facilities.

Raid on textile group

In addition, after raiding a significant corporate group involved in the manufacture of textile and filament yarn, the CBDT discovered black money worth crores secreted abroad.

The searches, which began on September 18, are still ongoing at the group’s locations, including its corporate offices in Delhi, Punjab, and Kolkata.

The CBDT stated in a statement that “the group has maintained unaccounted funds of about 350 crore in its foreign bank accounts and has also funnelled these funds back into its business through shell corporations in tax havens.”

“The modus operandi detected was related to foreign entities under the control of the group investing in foreign currency convertible bonds issued by its primary concern, and then converting them into shares of the company under the guise of defaulting on payments,” it added.

Many “incriminating” documents, loose sheets, diaries, digital evidences, and other items were recovered, according to the statement, indicating the group’s involvement in routing “unaccounted” funds back into its Indian entities and having foreign bank accounts that were “not reported” to the tax department.

“We have accumulated substantial evidence of transactions outside the books of accounts, cash transactions in land deals, fraudulent expenses debited in books of accounts, unaccounted cash expenditure, and lodging entries taken from entry operators,” it alleged.

“Foreign corporations and trusts were being paid management fees for managing the undeclared funds,” according to the CBDT.

“Though there is a particular requirement of disclosing foreign assets owned/managed in the form of companies and bank accounts in schedule FA in Income Tax Returns, the group has failed to do so,” it claimed.

“Details of accounts relating to inexplicable personal cash expenditures were found to be meticulously maintained in one of the company’s principal offices,” it stated.

The department has “proof” that cash of roughly Rs 100 crore was generated through debiting “bogus spending” in firm accounts and cash transactions in land sales, according to the statement.

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