Income Tax Department conducts searches on 60 premises of four Asset Reconstruction Companies

Last updated: 16 December 2021

Save Share

Quick Summary

The Income Tax Department has conducted searches on 60 premises belonging to four Asset Reconstruction Companies (ARCs) across multiple cities. The investigations revealed alleged unfair and fraudulent practices by ARCs in acquiring Non-Performing Assets (NPAs) from banks. It appears ARCs colluded with borrower groups, using shell companies and hawala channels to acquire NPAs at significantly undervalued prices, often using the borrower's own funds. Furthermore, ARCs allegedly used non-transparent methods to dispose of these assets, often re-acquiring them for the original borrowers at a fraction of their value, while concealing profits and evading taxes.

The Income Tax Department carried out search and seizure operations on 08.12.2021 on four Asset Reconstruction Companies (ARCs). Total of 60 premises spread over Mumbai, Ahmedabad, Delhi, etc. have been covered. The search action has revealed that the ARCs had adopted various unfair and fraudulent trade practices in acquiring the Non-Performing Assets (NPA) from the lender banks. It has been found that an unholy nexus existed between the borrower groups and ARCs and in the process, a maze of

Daily Limit Reached

You have reached your daily limit of 2 Free News

Subscribe to CCI PRO for unlimited access

Why Upgrade to CCI PRO?

No Ads
WhatsApp Community
Daily E-Newsletter
Unlimited News Access
Profile Visitors
Link Social Profiles
Featured Job Posts
Pro Badge
Expert GST Guidance
Unlimited Forum Replies
Download Content in PDF

1 Year PLAN - Rs.~~1999~~

1799

(Excl. of GST ₹323)

2 Years PLAN - Rs.~~3499~~

3149

(Excl. of GST ₹566)

BEST VALUE

3 Years PLAN - Rs.~~4999~~

4499

(Excl. of GST ₹809)

View all CCI PRO benefits

Already a PRO member? Login here for an ad-free experience. 07941056694

FAQ :

The Income Tax Department conducted search and seizure operations on 08.12.2021, covering 60 premises of four Asset Reconstruction Companies (ARCs).

The searches covered 60 premises spread across Mumbai, Ahmedabad, Delhi, and other locations.

The ARCs allegedly adopted unfair and fraudulent trade practices in acquiring Non-Performing Assets (NPAs) from lender banks, using shell companies and hawala channels, and acquiring assets at undervalued prices.

ARCs are found to have concealed profits by diverting them to related concerns under the guise of consultancy receipts or unsecured loans/investments, thereby evading taxes.

Evidence included a parallel set of accounts on Tally software containing over Rs. 850 crore in cash transactions, handwritten diaries detailing transaction layering, and offshore fund routing evidence. Rs. 4 crore in cash was also seized.

Large volumes of documentary and digital evidence are being analysed, and further investigations are in progress.

2070 Views Comment Share Miscellaneous Report

News posted by

CCI News Desk

Finance news reporter covering taxation, GST, income tax, business compliance, and economy updates. I simplify complex financial topics into easy-to-understand articles for professionals, taxpayers, and business owners on leading finance and tax platforms.

View News

Comments :