The Income Tax department detected evasion of tax of over ₹700 crore from the searches that it conducted on a prominent industrial group in the city. During the searches, the taxmen seized unaccounted cash to the tune of ₹23 crore from various locations.
The search operation was carried out on December 9 based on intelligence input about tax evasion.
The searches covered 60 premises located in Chennai, Trichy, Coimbatore, and various places in Andhra Pradesh, Karnataka and Mumbai. The business activities of the group that came under the IT department's lens include cement manufacturing, logistics and construction.
According to a statement issued by the Central Board of Direct Taxes (CBDT), foreign assets to the extent of ₹110 crore in the form of fixed deposits, not disclosed in the returns filed, were found during the search and would attract action under the Black Money Act. Inflation of expenditure to take out cash and reduce profits, unaccounted for receipts, bogus claim of depreciation, etc., amounting to ₹435 crore were also identified. There were also indications of capitation fee receipts for medical admissions to post-graduate programmes.
During the search, details of the actual financial transaction between the searched group and another group for the sale of three infrastructure facilities at various ports were found. Complex financial arrangements creating bogus liabilities from their own concerns were also seen to be made, ostensibly, to reduce the capital gains arising out of this transfer. Capital gains amounting to approximately ₹280 crore was arrived at. Similarly, huge capital introduction through a web of bogus inter-corporate transactions within the group is also under the scanner.
Details provided by the department showed a large number of lockers belonging to the group being identified.
Search has been temporarily concluded and investigations still in progress.
While the IT department has not officially mentioned the name of the group in its communiqués, sources indicated last week that the raids happened at the office of the Chettinad Group.
