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Two southern companies raided; over ₹620 crores under scrutiny

By IndianMandarins- 02 Mar 2021


New Delhi (02.03.21): The Income Tax Department's search and seizure (S&S) operations in southern India have revealed unaccounted income of about ₹400 crores and ₹220 crores in the books of a big Hyderabad pharma group and a leading Chennai tiles and sanitaryware manufacturing company, respectively. 
The S&S operations at the premises of two companies were carried out on February 24 and February 26. About 20 other premises belonging to these companies spread over five states were also raided simultaneously. 
In a statement, the CBDT claimed: "the search (of the pharma co) has led to the unearthing of evidence relating to unaccounted income of around Rs 400 crore, out of which the assessee group has admitted an additional income of Rs 350 crore." 
It refrained from mentioning the name of the pharma company and limited itself to stating that the pharmaceutical group is engaged in the business of manufacturing intermediates, active pharmaceutical ingredients (APIs) and formulations, and a majority of its products are exported to European countries and the USA.
It added that Rs 1.66 crore cash was also seized during the operation.
"Incriminating evidence in the form of digital media, pen drives, documents, etc. have been found and seized," the CBDT said.
The statement said digital evidence was gathered from SAP-ERP software.
"Issues relating to purchases made from bogus and non-existent entities, artificial inflation of certain heads of expenditure, along with suppression of receipts relating to by-product sale were detected", it said.
The IT department claimed to have found the "evidence of on-money payment for the purchase of lands..." 
Multiple other legal issues were also identified such as personal expenses being booked in the company's books and land purchased by related concerns or individuals below government value, the CBDT said.
It further said from the Chennai-based tile company, Rs 8.30 crore cash was seized during the raids.

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