The Income Tax Department has uncovered more than Rs 1,000 crore in alleged tax evasion during ongoing search operations at the premises of Refex Group and its associated entities, the department said in a statement on Thursday. The searches, conducted by the Investigation Directorate of the Chennai Income Tax Department, also revealed a Rs 250 crore unexplained overseas investment linked to a Switzerland-based pharmaceutical company.
Searches were launched on Tuesday across Refex Industries Ltd, the group's flagship company engaged in refrigerant gases, ash handling, power trading and solar energy, along with financiers, hawala operators and jewellery businesses allegedly connected to the promoters. Officials said the investigation exposed Rs 1,112 crore in bogus purchase transactions, primarily related to coal procurement and ash-handling contracts. The department also flagged equity investments worth Rs 382.68 crore received from 53 individuals and entities, many of whom were either non-filers or failed to disclose the transactions in their income tax returns, raising suspicions of benami funding.
Investigators further found documents relating to a US $30 million investment in Swiss pharma firm Astro Viz, the source of funds for which is under scrutiny. Additional red flags included a Rs 115 crore investment in DN Energy Ltd that was allegedly diverted soon after being credited. The searches also revealed the alleged use of shell companies created in the name of the promoter's driver, through which Rs 8.5 crore in cash deposits and over Rs 200 crore in transactions were routed. High-value personal expenditures, including a Rs 37 crore private jet, Rs 10 crore worth of luxury cars and Rs 4 crore spent on premium watches, were also detected.
Parallel searches were carried out on financier Rajesh Surana, who is reported to have advanced Rs 312 crore to Aradhya Infra, with the funds subsequently loaned onward. The role of hawala operators in routing more than Rs 10 crore through illegal non-banking channels is also under investigation. So far, the department has detected over Rs 1,000 crore in unaccounted income and seized Rs 70 crore in unaccounted cash, gold and silver, with further investigation ongoing.
In a statement, Refex Group said it is fully cooperating with the authorities and that its business operations continue as usual. The company reaffirmed its commitment to legal compliance, ethical conduct and regulatory transparency, and urged stakeholders to rely only on officially verified information released by competent authorities.
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