CHENNAI: The income tax department searched five locations in Chennai and Madurai on November 4 in a case involving a Chennai-based IT infrastructure group. Unaccounted income for a sum of Rs 1,000 crore was found, according to an official statement from the income tax department.
The IT department said it uncovered evidence related to curious investments in a Singapore-registered company. The shareholding of the company in question was held by two others. One of them was the group that was sought by the income tax department, while the other is a subsidiary of a major infrastructure development and financing group.
The IT department said the company that was raided had a 72% stake despite investing a nominal amount. The rest had the largest infrastructure despite having a large investment.
“This resulted in a profit of almost 7 million Singapore dollars, which is 200 million rupees. This was not disclosed by the company,” he said.
“The income tax department conducted searches at five locations in Chennai and Madurai on November 4. The proceedings will start under the Black Money Act of 2015. The present value of the investment exceeds Rs 354 crore, ”the IT department said.
He also claimed that the group had acquired five shell companies which were used to divert Rs 337 million from the group’s main company by collecting false invoices and without doing any real business.
The IT department said it found evidence regarding the allocation of preferred shares worth Rs 150 million in 2009 in the group company by passing only accounting entries, to project inflated capital to banks and financial institutions to obtain finance. The allocation of other preferred shares worth Rs 150 million in 2015 from funds of group companies, which in turn borrowed / inflows, is under consideration.
During the search, officials discovered that the group had borrowed funds from interest-bearing banks and diverted them to other group companies without interest for property investments. The total disregard of interest on this count is estimated at approximately Rs 423 million.
Furthermore, the search also revealed that the group had purchased around 800 acres of land worth at least Rs. Rs 500 million, on behalf of various shell companies of the funds provided by the main group. The applicability of the Benami Property Transactions Prohibition Act of 1988 to these transactions is under review.
The IT department said there was a transfer of substantial holdings during the current year at a price much lower than the fair market value to be determined under the IT Rules of 1962. In light of this, it is likely that they will take place. substantial additions to section 56 (2) (x) of the IT Act of 1961 (the Act) in the case of the buyer and capital gains under Section 50CA of the Act, held by the seller. The amount of this will be determined in due course.
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