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Income Tax Department conducts raids at Hyderabad-based group

ANI | Updated: Jul 09, 2021 23:48 IST

New Delhi [India], July 9 (ANI): Income Tax Department carried out a search and seizure operation on Tuesday at a Hyderabad-based real-estate company.
The group is engaged in real estate, construction, waste management, and infrastructure. The activities of waste management are spread across India while real estate activities are mainly concentrated in Hyderabad, the release stated.
Further, during the course of the search and seizure operation, the department seized many incriminating documents, loose sheets etc, indicating an involvement of the group in unaccounted transactions. It was found that the group had sold a majority stake to a Non-resident entity based in Singapore, in one of its group concerns during FY 2018-19 and had earned huge capital gains.

The group subsequently devised various colourable schemes by means of entering into a series of share purchase/sale/Non arm's length valued subscription and subsequent bonus issuance etc with related parties, creating a loss which was set off against the capital gains earned. Incriminating evidence/documents have been recovered, which indicates that the loss was artificially created to set off the respective capital gains.
The release stated that the search operation led to the detection of artificial loss of approximately Rs. 1,200 crore, which is to be taxed in the hands of the respective assessees.
Further on, as per the release, it was found that the assessee had incorrectly claimed bad debts to the tune of Rs. 288 crore on account of related party transactions, which was set off against the aforementioned profits earned. During search proceedings, incriminating documents relating to this artificial/incorrect claim were found. Unaccounted cash transactions with the associates of the group have also been detected during the search, and the quantum and modus of the same are under examination.
As a result of the search and seizure operation, and on the basis of various incriminating documents found, the entities and associates have admitted to having an unaccounted income of Rs. 300 crore and have also agreed to pay due taxes, the release said.
Further investigations are underway. (ANI)