MGM group evaded tax to the tune of Rs 400 crore: I-T dept

Tamil Nadu-based MGM Group, whose business interests range from producing Indian Made Foreign Liquor (IMFL) to hospitality, evaded taxes exceeding Rs 400 crore by debiting non-genuine purchase bills in various businesses’ account books, the Income Tax department said on Monday.

In a statement released about the day-long raids conducted at 40 premises of the company—in Tamil Nadu, Puducherry, and Telangana—the I-T department said the operations yielded various incriminating “documentary and digital evidence” of tax evasion by the company.

MGM group has diversified businesses including manufacturing of IMFL, logistics, restaurants, and an amusement park. Though the I-T department did not mention the group’s name, sources told DH it is MGM group.

The I-T department’s statement said analysis of the evidence indicates that the “assessee group” indulged in large-scale tax evasion exceeding Rs 400 crore by debiting non-genuine purchase bills in the books of account of varied businesses.

“These non-genuine purchase bills were either obtained from its regular material suppliers or from accommodation entry providers. On gleaning, the seized evidence(s) have also revealed that the payments made to the material suppliers through cheque(s) have been received back in cash for making unaccounted investments and also for other purposes,” the statement said.

The group was also found to be controlling back-office operations of its international chain of hotels, from India. The department said the action led to the seizure of undisclosed cash of Rs 3 crore and unaccounted gold jewellery worth Rs 2.5 crore.