Income Tax dept raids in several states; Rs 94-crore cash, jewellery seized

The Income Tax Department on Monday has conducted raids and seizure action related to some government contractors, real estate developers and their associates last week and about 55 premises were covered in Karnataka, Andhra Pradesh, Telangana and New Delhi.

According to a CBDT press release, “Incriminating evidence in the form of loose sheets, hard copies of documents and digital data have been found and seized. It said the search has resulted in a seizure of unaccounted cash of approximately Rs 94 crore and gold and diamond jewellery of over Rs 8 crore, aggregating to more than Rs 102 crore. A cache of about 30 luxury wristwatches of foreign make was unearthed from the premises of a private salaried employee, not engaged in the business of wristwatches, the release said.”

According to the sources, the searches were also conducted on October 12.

The release said that the modus operandi of tax evasion indicates that these contractors were involved in reducing their income by inflation of expenses by booking “bogus purchases, non-genuine claim of expenses with sub-contractors and claiming ineligible expenses”.

“The irregularities detected in the utilization of contract receipts has resulted in the generation of huge unaccounted cash and creation of undisclosed assets,” the release said.

Apart from this, the evidences indicating inflation of expenses in the form of discrepancies in Goods Receipt Note (GRN) validation has been scooped out during the search.

Evidence of “huge discrepancies” in the documentation related to purchases booked and actual physical transport of goods have also been unearthed with regard to bogus transactions with sub-contractors, some of whom were also covered during the search, the release said.

“The contractors were also involved in booking expenses for non-business purposes and evidence of claim of liaison expenses has also been found. Large-scale unaccounted cash transactions, which are not found recorded in the books of account, have also been found during the search, from the premises of assessees, sub-contractors, and associates including certain cash handlers,” it said.