The Income Tax Department has detected evasion of income of over ₹700 crore from the searches it conducted on the premises of a prominent industrial group in the city. During the searches, officials seized ₹23 crore in unaccounted cash from various locations.
The search operation was carried out on December 9, based on intelligence inputs about tax evasion. It covered 60 premises across Chennai, Tiruchi and Coimbatore in Tamil Nadu, Andhra Pradesh, Karnataka and Mumbai. The business activities of the group that came under the lens included cement manufacturing, logistics and construction, among others.
According to a statement issued by the Central Board of Direct Taxes, foreign assets worth ₹110 crore, in the form of fixed deposits, were found during the searches. They had not been disclosed in the returns, and would attract action under the Black Money Act.
Inflation of expenditure to take out cash and reduce profits, receipts not accounted for in full, bogus claim of depreciation and other such activities, adding up to ₹435 crore, were also detected. There were also “indications of capitation fee receipts for medical admissions to postgraduate programmes”.
Details of financial transactions between the group in question and another group for the sale of three infrastructure facilities at various ports were found during the searches. Complex financial arrangements creating bogus liabilities from their own concerns were also said to have been made, ostensibly to reduce the capital gains arising out of the transfer.
Capital gains of approximately ₹280 crore have been established. Huge capital introduction through a web of bogus inter-corporate transactions within the group is also under the scanner.
While the I-T Department did not mention the name of the group, sources indicated that the raids were carried out on the premises of the Chettinad Group.