In a recent development, the Income Tax Department has conducted an extensive search and seizure operation in the picturesque Kashmir Valley. This operation targeted a well-known business conglomerate with interests spanning various sectors, including Cement, Steel, Glass, Plywood, Real Estate, Tourism, Textiles, and Healthcare. The search operation, executed on October 9, 2023, covered more than 40 premises in different regions, including Srinagar, Sopore, Budgam, Sonmarg, Pulwama, and Delhi.
Detailed Analysis
1. Incriminating Evidence: The search operation yielded a significant amount of incriminating evidence, including documents, handwritten diaries, and digital devices. This evidence hints at financial irregularities and discrepancies in the group’s operations.
2. Undisclosed Investments: The investigation unveiled undisclosed investments in immovable properties within the Kashmir Valley, amounting to more than Rs. 50 crore. This indicates that the group may have been channeling funds into real estate without proper documentation.
3. Taxable Income Suppression: The most significant revelation pertains to the group’s underreporting of taxable income, particularly in the cement sector. It has been disclosed that the group suppressed income by more than Rs. 60 crore over several years. The evidence supporting this includes unrecorded cash vouchers and sales invoices, which suggest a deliberate attempt to avoid taxation.
4. Undisclosed Sales: In addition to the cement sector, the investigation also uncovered undisclosed sales exceeding Rs. 50 crore in the textile and plywood sectors. This further raises concerns about tax evasion in these areas.
5. Real Estate Anomalies: The group’s real estate activities, both in Kashmir and Delhi, revealed documents demonstrating the receipt of “on-money.” This revelation suggests that the group may have been underreporting its receipts in the books of account, amounting to an estimated Rs. 10 crore.
6. Key Figure’s Admission: Perhaps the most crucial development is the admission by a key figure within the group regarding the modus operandi employed to generate undisclosed income. This acknowledgment is likely to have far-reaching implications.
7. Seizures: The search operation resulted in the seizure of unaccounted cash exceeding Rs. 1.70 crore and unaccounted bullion valued at Rs. 16 lakh. These seizures underscore the magnitude of the alleged financial irregularities.
8. Ongoing Investigations: The Income Tax Department has emphasized that further investigations are underway. These investigations will delve deeper into the financial practices of the business group to uncover the full extent of tax evasion and financial discrepancies.
Conclusion
The recent Income Tax search operation in the Kashmir Valley has uncovered what appears to be a significant case of tax evasion by a prominent business group. With the suppression of taxable income, undisclosed investments, and financial irregularities spanning various sectors, this case exemplifies the importance of robust tax enforcement measures. As investigations continue, the findings of this operation will likely have significant implications for the group and may serve as a stark reminder of the consequences of tax evasion.
****
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
******
New Delhi, 11th October, 2023
Press Release
Income Tax Department Conducts Search and Seizure Operation In Jammu and Kashmir
Income Tax Department conducted a search and seizure operation in the Kashmir Valley on a prominent business group, engaged in various sectors namely, Cement, Steel, Glass, Plywood, Real Estate, Tourism, Textiles and Healthcare, etc. on 09.10.2023. More than 40 premises were covered in Srinagar, Sopore, Budgam, Sonmarg, Pulwama areas of Kashmir Valley and at Delhi.
During the search operation, incriminating documents, hand written diaries, and digital devices have been seized. Variation in stock has also been noticed in the various factories and retail outlets. Evidence of undisclosed investments in immovable properties located in Kashmir Valley of more than Rs. 50 crore has also been found from various premises.
Investigations so far made, has shown that the group has been suppressing its taxable income by grossly under-reporting its sales in the cement sector by more than Rs. 60 crore over the past several years. In this regard, evidence in the form of cash vouchers and sales invoices has been seized, which is found to have not been recorded in the books of account. Similarly, evidence of undisclosed sales in the books of account exceeding Rs. 50 crore in textile and plywood sectors has also been found.
In the real estate business of the group, being carried out in Kashmir and Delhi, documents evidencing the receipt of on-money have been recovered. The Such suppression of receipts in the books of account are estimated to be about Rs. 10 crore.
The key person of the group has admitted the above modus-operandi being followed for generation of undisclosed income.
The search action has resulted in seizure of unaccounted cash exceeding Rs.1.70 crore. In addition, unaccounted bullion worth Rs. 16 lakh has also been seized.
Further investigations are in progress.
(Surabhi Ahluwalia)
Pr. Commissioner of Income Tax
(Media & Technical Policy) &
Official Spokesperson, CBDT
