Income Tax Department conducts searches in a group case from Erode in Tamil Nadu

Last updated: 18 April 2021

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The Income Tax Department has conducted searches across 15 premises in Erode and Chennai belonging to a prominent civil contractor. The group, involved in government projects, bus transport, marriage halls, and food masalas, was found to be inflating purchases and expenses. This led to the seizure of £21 crore in unaccounted cash and the detection of approximately £700 crore in undeclared income, with £150 crore admitted by the assessee so far.

The Income Tax Department carried out searches on 14.12.2020 in a group case from Erode in Tamil Nadu, covering 15 premises at Erode and Chennai. The group is a leading civil contractor for Government works, specialised in erecting Seawave breaks along the coastlines and diversified into bus transport, running marriage halls and food masala business.

The highlight of the search is seizure of Rs. 21 crore of unaccounted cash. It was found that the group indulges in inflation of purchases and other work contract expenses. Such inflated payments made to the suppliers and subcontractors are received back in cash regularly. The unaccounted income thus generated comes to around Rs. 700 crore, which is ploughed back into real estate investments and business expansion. Out of this, the assessee has admitted to having undisclosed income of Rs. 150 crore, so far.

Overall there is a detection of Rs. 700 crore of unaccounted income and a seizure of Rs. 21 crore of unaccounted cash as a result of this search.

Further investigations are in progress.

FAQ :

The searches were carried out on 14.12.2020.

The searches took place at 15 premises in Erode and Chennai, Tamil Nadu.

The group is a leading civil contractor for government works, specialising in erecting Seawave breaks, and has diversified into bus transport, marriage halls, and food masalas.

A significant amount of £21 crore in unaccounted cash was seized.

The search resulted in the detection of around £700 crore of unaccounted income.

Yes, the assessee has admitted to having undisclosed income of £150 crore so far.

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