The Income Tax Department carried out a search and seizure operation on July 7 on a real estate, construction, infrastructure and waste management firm based in Hyderabad.
The activities of waste management are spread across the country while real estate activities are mainly concentrated in Hyderabad.
During search and seizure operation, many incrimination documents, loose sheets and other materials were seized indicating involvement of the group in unaccounted transactions.
NRI entity
“It was found that the group has sold majority stakes, to a non-resident entity based in Singapore, in one of its groups concerns during FY 2018-19 and had earned huge capital gains. The group subsequently devised various colourable schemes by means of entering into a series of share purchase/sale/non arm's length values subscription and subsequent bonus issuance etc with related parties, creating a loss which was set off against the capital gains earned,” an official release from IT Department read.
It read that incriminating evidence/documents have been recovered, which indicate that the loss was artificially created to set off the respective capital gains. The search operation led to detection of artificial loss of approximately ₹1,200 crore, which is to be taxed in the hands of the respective assesses, it read.
Further, during the course of the search, it was found that the assessee had incorrectly claimed bad debts to the tune of ₹288 crore on account of related party transactions, which was set off against the aforementioned profits earned.
During search proceedings, incriminating documents related to the artificial/incorrect claim were found.
Unaccounted cash transactions with the associates of the group have also been detected during the search, and the quantum and modus of the same is under examination. As a result of the search and seizure operation, and the basis of various incriminating documents found, the entities and associates have admitted to having unaccounted income of ₹300 crore and have also agreed to pay due taxes. Further investigation is on.
