The Income Tax Department had detected “undisclosed” income of Rs 75 crore after it raided some contractors and traders at multiple places in the poll-bound Bihar, the CBDT said on Friday. The searches were carried out on Thursday against “four prominent” contractor groups in Patna, Bhagalpur, Hilsa and Katihar.
Also, surveys (where the taxman only searches business premises of the assessee) were carried out against some traders of mined rocks in Gaya district of the state. “All the four groups have been found to have been evading taxes by inflating expenses for the supply of material and labour. The searches, so far, have led to unearthing of unaccounted income of about Rs 75 crore,” the Central Board of Direct Taxes said in a statement. The CBDT is the administrative authority for the Income Tax Department. As much as Rs 3.21 crore cash has been seized during the raids, while fixed deposits of Rs 30 crore have been placed under prohibitory orders, it said.
Further, properties worth Rs 16 crore are being placed under prohibitory orders, the statement said. Polls for the 243-member Bihar assembly are being held in three phases. The first phase was held on October 28, while the next two rounds will be held on November 3 and November 7. Counting of votes will be held on November 10.
The tax department has this month alone raided two government contractors, a silk trader, a mining businessman, a cooperative bank chairman and their linked entities in Bihar on charges of tax evasion. The CBDT said, in one case, it found payments have been made to various parties without any evidence of having received any services or supplies.
“Payments made to bogus parties are received back as an unsecured loan or sometimes withdrawn in cash. Such loans are of about Rs 10 crore,” it said. The tax department also found that “substantial bogus purchases have been debited in the books.” “These parties do not exist, but are shown as ‘creditors’ in the books. Such creditors amount to about Rs 20 crore,” it said. Bank documents, accounts and other “incriminating” material of some bogus parties have been seized from the premises of the assessee, it said.
“These documents and consequential field investigations clearly show that the parties are not genuine and bank accounts have been opened and are being operated by the assessee only.” “The cash generated has been used in acquiring properties,” the CBDT said. Documents show that in another case, payments for inflated expenses are being made by bearer cheques. “These payments are withdrawn from the bank account by the assessee’s own persons. Such amounts are being quantified.” “There are sundry bogus creditors for unpaid labour of about Rs 15 crore,” it said.
Documents showing inflation of expenses of about Rs 15 crore in another group have been found, it said. This group has made investments in properties in Bihar, Odisha, and Madhya Pradesh. In another case, evidence of payments made for bogus purchases through cheques but received back in cash has been seized, it said. “The cash generated has been invested in purchasing properties and construction of a commercial building. Evidence of such concealment of income of about Rs 10 crore, using this modus operandi, has been found,” it said.
In the survey operation, evidences of unaccounted cash entries, unaccounted sales and purchases have been found totalling to over Rs 8 crore, the Board said. “In addition, sales and purchases of stone etc have been found to be not recorded in the books of accounts,” the CBDT said.
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