Income Tax Department conducts searches in West Bengal

The Income Tax Department carried out a search and seizure operation on August 18, 2022 on two prominent real estate groups of Kolkata.

During the course of the search operation, a large number of incriminating evidence including documents and digital data have been found and seized. There are evidences of out of books cash transactions and on-money receipts. Several documents and electronic data indicate routing of unaccounted money through shell companies. Further, some of the evidences found during the search operation indicate use of unaccounted funds in land acquisition.

The key persons admitted use of shell companies for infusion of unaccounted funds in the form of share capital, share premium and unsecured loans through sale of bogus investments.

The search action has, so far, led to a detection of a total unaccounted income of more than Rs. 250 crore. During the course of search proceedings, 16 bank lockers have been found which have been placed under restraint.

Further investigations are in progress.

The Press Release can be accessed at: https://www.pib.gov.in/PressReleasePage.aspx?PRID=1855772

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The Income Tax Department carried out search and seizure operation on December 16, 2021 on two prominent Asansol based groups, engaged in business of iron and steel products, infrastructure, cement, poly fabs, agro-tech & food processing, etc. The search action covered more than 30 premises spread over West Bengal.

A large number of incriminating evidences in the form of documents and digital data stored in SD cards, WhatsApp chats, etc. have been found and seized. The search team has detected that SD cards have been used to keep details of a parallel set of unaccounted sales, excel sheets of actual production data, parallel tally accounts files, cash payment details made to various parties etc.

A preliminary analysis of seized SD cards and related evidences reveal that these contain unaccounted cash handled by key employees of the directors and owners of the entities. The key persons of one of the groups have admitted that unaccounted income of more than Rs. 66 crore has been generated through unaccounted cash sales from its manufacturing units during the financial year FY 20-21. In certain other entities, evidences have been found relating to claim of unsubstantiated purchases, out of which purchases to the extent of Rs. 20 crore have also been admitted by the directors as undisclosed income.

Further, analysis of seized evidences of another group reveals that many paper companies, which are run by entry operators, have been used to provide accommodation entries to its flagship concerns. These shell entities have been found to have routed back the unaccounted money of the group in the guise of share capital/unsecured loan into the books of account of these entities. It has been corroborated, with admission by directors of these entities concerned, that, quantum of such routing exceeds Rs. 40 crore.

The Press Release can be accessed at: https://www.pib.gov.in/PressReleasePage.aspx?PRID=1783764

The Income Tax Department carried out a search and seizure operation on September 17, 2021 on a prominent group engaged in manufacturing of steel products. 25 premises consisting of 8 residences, 9 offices and 8 factories, spread over Kolkata, Durgapur, Asansol and Purulia and other regions of West Bengal were covered in the operation.

The search operation has led to the detection of huge quantity of incriminating documents and digital evidence from different premises. Evidences pertain to generation of unaccounted income by the group by way of unaccounted  cash sales, unaccounted cash expenditure, purchase from bogus parties, under-reporting of actual production, cash purchases of scrap, several documents of land purchases and sale etc. Evidence has also been found pertaining to the utilisation of the unaccounted income in the form of unsecured loans and sale of shares of shell entities though layering of the unaccounted income. A large number of property documents pertaining to one of the members of the group, showing land and property holding in different names, have also been seized. The total amount of such incriminating evidences pertaining to the manufacturing group exceeds Rs. 700 crore. The operation has led to seizure of unaccounted cash amounting to Rs. 20 lakh while 2 lockers remain to be operated.

During the search operation, an accommodation entry provider, who was providing entries to the searched group, was also covered. From his secret back office, huge number of incriminating documents pertaining to providing accommodation entries through modes like sale of shares of shell companies, unsecured loans from shell entities, bogus billing, etc. have been found, the total amount of which runs into several hundreds of crores of rupees. Evidence of more than 200 companies/entities having more than 200 bank accounts being managed from the entry operator’s premises have been found. On the basis of preliminary examination of these documents, it appears that these bank accounts and entities have been used as conduit to route the unaccounted income of many beneficiaries.

 Further investigations are in progress.

The Press Release can be accessed at: https://www.pib.gov.in/PressReleasePage.aspx?PRID=1756684

The Income Tax Department has carried out searches on 05/11/2020 in the case of one prominent coal trader of West Bengal having premises in Raniganj, Asansol, Purulia and Kolkata. The searches were based on intelligence gathered, which indicated that large scale unaccounted cash was being generated and used for various purposes.

The searches have led to seizure of documents indicating that companies of the assessee group held bogus investments in unquoted equity shares of paper concerns to the magnitude of around Rs. 150 crore, out of which investments of around Rs. 145 crore have been sold. These sale transactions were found to be sham transactions and have been admitted by the assessee in the statement recorded during the search.

The searches have also led to seizure of a substantial number of incriminating documents showing cash generation in coal and sand trading, sponge iron sales etc. Documents have also been seized indicating huge unaccounted expenses for facilitation of coal transport and various trading activities.

The searches have led to seizure of unaccounted cash and bullion of around Rs. 7.3 crore. 

Further investigations are going on.

The Press Release can be accessed at: https://www.pib.gov.in/PressReleasePage.aspx?PRID=1670627