Income Tax Department Conducts Search and Seizure Operation in 40 premises of J&K based Business Group; Seizes Rs. 1.70 Crores of Unaccounted Cash

Income Tax Department - Search - Seizure Operation - Business Group - Unaccounted Cash - taxscan

In a significant operation conducted on October 9, 2023, the Income Tax Department undertook a thorough search and seizure action in Jammu & Kashmir, focusing on a prominent business conglomerate. This group operates across a diverse range of sectors, including Cement, Steel, Glass, Plywood, Real Estate, Tourism, Textiles, and Healthcare, among others. The operation spanned across more than 40 locations, encompassing areas in Srinagar, Sopore, Budgam, Sonmarg, Pulwama, within the Kashmir Valley, and also extended to Delhi.

This intensive search action yielded the seizure of unaccounted cash totaling more than Rs. 1.70 crore, underlining the gravity of the financial discrepancies uncovered. Additionally, unaccounted bullion with an estimated value of Rs. 16 lakh was also seized.

During the course of this operation, a substantial volume of incriminating evidence was uncovered. Investigators seized a multitude of documents, handwritten diaries, and various digital devices. Notably, discrepancies in stock records were discovered across different factories and retail outlets. In addition, evidence pointed to undisclosed investments in immovable properties situated within the Kashmir Valley, collectively valued at over Rs. 50 crore.

Preliminary investigations have revealed that the business group has been significantly underreporting its taxable income, primarily through the gross underreporting of its sales in the cement sector, amounting to more than Rs. 60 crore over several years. The evidentiary taril included cash vouchers and sales invoices, which had not been properly recorded in their accounting records. Similar evidence of undisclosed sales exceeding Rs. 50 crore was detected in the textile and plywood sectors.

In the real estate segment, which the group operates in both Kashmir and Delhi, documents verifying the receipt of “on-money” were recovered. It was determined that the suppression of these receipts in their financial records amounted to approximately Rs. 10 crore.

Notably, the key figure within the group has admitted to employing the aforementioned modus operandi to generate undisclosed income. The investigation is ongoing, and further actions are expected as authorities continue to delve into the financial dealings of this business group.

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