Income Tax Department conducts search operations at premises of wires, cables and electrical items manufacturer in Mumbai
According to preliminary findings, the flagship company engaged in unreported cash sales, cash payments for unaccounted purchases, and cash payments for unaccounted purchases, non-genuine transport and sub-contracting expenses, etc for suppression of its taxable income.
The Income Tax Department informed on Wednesday that it began search and seizure operations in the case of a group engaged in the manufacture of wires, cables, and other electrical equipment on Friday, December 22. The search that included some of the group's authorised wholesalers was carried out at more than 50 locations in Mumbai, Pune, Aurangabad, Nashik, Daman, Halol, and Delhi.
The department sources infromed that during the search, a huge amount of incriminating evidences in the form of documents and digital data were discovered and seized. These evidences show that the group engaged in tax evasion in collusion with some of the approved distributors, it added.
According to preliminary findings, the flagship company engaged in unreported cash sales, cash payments for unaccounted purchases, and cash payments for unaccounted purchases, non-genuine transport and sub-contracting expenses, etc for suppression of its taxable income.
Reports said that credible evidence discovered during the search indicated that the flagship company made unauthorised cash sales of around Rs 1000 crore that were not reported in the books of accounts. Evidence of unauthorised cash payments totaling more than Rs 400 crore made by a distributor on behalf of the main firm for raw material purchases has also been collected, the department sources added.
Furthermore, non-genuine charges in the form of subcontracting expenses, purchases, and transportation expenses, etc. totaling around Rs 100 crore have been detected in the collected evidences from the flagship company's facilities.
The search operation also resulted in the conclusion of unexplained transactions done by the distributor for producing bills without genuine supply of products, despite the fact that such commodities were sold in cash on the open market. As a result, the authorised distributor assisted certain parties in inflating their purchase accounts, which totaled around Rs 500 crore.
During the search operation, unaccounted cash totaling Rs 4 crore was confiscated, and more than 25 bank lockers were placed under lock and key.
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