The Income Tax department has said searches conducted over the last week at premises belonging to three infrastructure firms based in Andhra Pradesh and Telangana have led to the detection of unaccounted income of more than Rs 2,000 crore.
Search and seizure raids were carried out on February 6 at Hyderabad, Vijaywada, Cuddapah, Vishakhapatnam, Delhi and Pune. More than 40 premises were covered.
A press release issued by the Central Board of Direct Taxes says investigations led to busting of a major racket of cash generation through bogus sub-contractors, over-invoicing and bogus billing.
Several incriminating documents and loose papers were reportedly found and seized during the search, apart from emails, WhatsApp messages and unexplained foreign transactions unearthed during the search, the release says.
Search operation was also carried out on close associates including ex-personal secretary of a prominent person and incriminating evidence is said to have been seized.
The search operations reportedly revealed that Infrastructure companies had sub-contracted work to several non-existent/bogus entities.
Preliminary estimates, it claims, suggest siphoning of more than Rs 2,000 crore through transactions that were layered through multiple entities with the last in the chain being small entities with turnover less than Rs 2 crore to avoid maintenance of books of accounts and tax audits etc.
Such entities were reportedly either not found at their registered address or were found to be shell entities. Several such sub-contractors were said to have been controlled by the principal contractors with all their ITR filings and other compliances being done from the IP addresses of main corporate office.
Foreign Direct Investment or FDI receipts of several crores in the group companies of one of the Infrastructure companies is suspected to be round-tripping of its unaccounted funds, the department has said.
Unexplained cash of Rs 85 lakh and jewellery worth Rs 71 lakh have been seized. More than 25 bank lockers have been restrained, the release has said.