Rs 400 crore undisclosed income detected in raids by Income Tax sleuths in Tamil Nadu

CHENNAI: The Income Tax department on Wednesday said that it has detected undisclosed income of around Rs 400 crore after it carried out search operations at 20 premises in Chennai, Coimbatore, Salem, Virudhunagar and Theni. This pertains to a group of individuals involved in handling huge amounts of cash and routing unaccounted money through foreign entities and bank accounts, a statement from the department said.

The searches were carried out on March 11. It is said that cash deposits of more than Rs 100 crore were made through various entities in the guise of sale and purchase of agricultural commodities though no such activity exists and no stock was found.  

"The sale and purchase invoices were found to be fabricated by their employees. Further, sales and stock were circulated among group entities to manipulate the turnover to obtain bank loans. Many of these entities had not filed any tax return so far," a Central Board of Direct Taxes spokesperson said in the statement on Wednesday.

The statement said that the searches also revealed Rs 150 crore was received by a group entity through a debenture issue from a foreign entity. The evidence found during the search revealed that this was a sham transaction and all the money went to the personal accounts of these individuals.

Similarly, a group entity is said to have imported spices wherein they over-invoiced the import cost to about Rs 25 crore. The money was siphoned off from India and diverted to their personal accounts in other countries.

During the search, evidence was unearthed which showed numerous immovable properties have been purchased in the last 3-4 years in prime locations of Chennai and other towns of Tamil Nadu at a value less than circle rates. Many of these properties were also not disclosed in the IT returns, according to the statement.

More than 25 luxury cars were found during the search and many were unaccounted. The statement claimed that evidence has also been found of the existence of undisclosed foreign bank accounts, foreign credit cards and investments in foreign entities. Unaccounted cash of Rs 50 lakh, jewellery worth Rs 3 crore and 9 luxury vehicles worth Rs 12.5 crore have been seized so far.