I-T raid on 2 firms, Rs 4.7 cr unaccounted cash seized

Income Tax officials conducted searches on two groups of companies in Hindupur and Bellary in Bengaluru’s jurisdiction. The companies in question manufacture TMT rods and other steel products.

According to the I-T department, the searches on August 7 yielded a seizure of Rs 4.7 crore of unaccounted cash and jewellery. A huge volume of incriminating documents and digital evidence showing unaccounted sales were recovered, too.

Evidence found from the premises revealed that one group thrived on unaccounted cash sales, employing a novel method of sales suppression, termed by them as 1+1 scheme, wherein for a single GST invoice raised, two loads of material were delivered to the customer — one load accounted for and the other unaccounted for, an I-T department release stated.

The sale proceeds of one load is received in cheque and the other in cash. The transporters are paid in cash for the second load.

I-T sleuths found digital evidence from the mobile phones of key employees in the form of various messages showing the use of hawala channels for transfer of cash from one place to another. Various loose sheets, diaries and corroborating messages were found as well.

The searches revealed the misuse of GST input credit by the two groups.

The groups have taken accommodation bills from ‘bill traders’ for a value exceeding Rs 600 crore. Evidence found and extracted from digital data showed that the accommodation bills have been taken to disguise, and account for the scrap purchases made in cash and unaccounted production of TMT rods.

IT sleuths have also recorded statements from various employees of the said enterprises. The two companies were also accused of using dummy bills.