Have unearthed irregularities worth over ₹3,000 cr of two cos: IT Dept

Our Bureau New Delhi | Updated on July 24, 2021

A pan-India firm with media holdings had indulged in cyclical trading and transfer of funds amounting to ₹2,200 and tax evasion of ₹700 crore

The Income Tax Department on Saturday said that search operations on a pan-India company, which has presence in media and other sectors, unearthed cyclical trading and transfer of funds amounting to ₹2,200 crore and tax evasion of ₹700 crore spread over a period of 6 years. The department also found some diversion of loans from commercial banks and other activities. Similar search operations on another entity, dabbling in media and other sectors, led to tracing of unaccounted transactions of ₹200 crore.

Both search operations were carried out on July 22, it said. Though the department did not give the names of entities but going by the description of entities and date of search operation, it appears the first one is Bhaskar group while the other is the UP-based news channel Bharat Samachar.

Pan-India entity

Giving details about the search operations, the department said, “Cyclical trading and transfer of funds among group companies engaged in unrelated businesses to the tune of ₹2,200 crore have been found. The enquiries have confirmed that these have been fictitious transactions without any actual movement or delivery of goods. The tax effect and violation of other laws are being examined.”

Further, it said that a real estate entity belonging to the group operating a mall had been sanctioned a term loan of ₹597 crore by a nationalised bank. Out of this, ₹408 crore has been diverted to a sister concern as loan at a low interest rate of 1 per cent. “While the real estate company has been claiming expenses of interest from its taxable profit, it has been diverted for personal investments of the holding company,” it said.

Also read: I-T searches at Dainik Bhaskar Group on evasion charges

A statement from the department mentioned that the listed media company does barter deals for advertisement revenues, whereby immovable properties are received in lieu of actual payments. Evidence has been found indicating cash receipts in respect of subsequent sale of such properties. “This is under further examination,” the department said.

Similarly, the evidence unearthed also indicated that receipt of cash for sale of flats by the reality arm of the group. The same has been confirmed by two employees and one director of the company, it said. The modus operandi as well as the corroborating documents have been found. The exact amount of out-of-books cash receipts are being quantified. A total of 26 lockers have been found in the residential premises of the promoters and key employees of the group. “The voluminous material found during the search operations is being examined. The searches are continuing and further investigations are in progress,” the statement said.

The department introduced the concerned entity as a prominent business group, which is involved in businesses in various sectors, including media, power, textiles and real estate, with a group turnover of more than ₹6,000 crore per annum. As many as 20 residential and 12 business premises spread over nine cities including Mumbai, Delhi, Bhopal, Indore, Noida and Ahmedabad have been covered.

It said that the group has more than 100 companies including the holding and subsidiary companies. During the search, it was found that they have been operating several companies in the names of their employees, which have been used for booking bogus expenses and routing of funds. During the search, several of the employees, whose names were used as shareholders and directors, have admitted that they were not aware of such companies and had given their Aadhaar card and digital signature to the employer in good faith. Some were found to be relatives, who had willingly and knowingly signed the papers but had no knowledge or control of the business activities of the companies, in which they were supposed to be directors and shareholders.

Published on July 24, 2021

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