Income Tax Department conducts search operations on a real estate group in Mumbai and the Navi Mumbai region of Maharashtra.
The Income Tax Department initiated search and seizure operations on a real estate group, engaged in the construction of residential and commercial projects, in Mumbai and Navi Mumbai Region on 25.11.2021. The group is mainly carrying out the development of slum rehabilitation projects. The search action covered around 30 premises.
The search action unearthed various methods of tax evasion adopted by the group. Several documentary and digital evidence have been found and seized demonstrating receipt of cash to the tune of Rs.100 crore, as part of consideration on sale of flats, which is not accounted for in the regular books of account. The fact of receipt of on-money on such transactions is also corroborated in the statements recorded during the search proceedings. The modus operandi adopted by the group includes issuing promissory notes equivalent to the on-money component to the customers and these promissory notes are destroyed after registration of the flat.
Incriminating evidence regarding unaccounted cash payments made not only to the original tenants of the slums for vacating the dwelling unit but also to some other persons for facilitating vacation of the properties by slum dwellers has been found and seized. Further evidence suggesting irregularities and violation of guidelines of Slum Rehabilitation Authority (SRA) have also been detected.
The preliminary analysis of evidence revealed that the group has acquired a controlling stake in a company by paying consideration in cash. Defaults on compliances to the provisions of tax deduction at source have also been found. The assessee group did not deduct tax at source on certain payments claimed by it which aggregate to more than Rs. 300 crore.
As a result of the search action, unaccounted cash exceeding Rs. 6.00 crore has been seized.
Further investigations are in progress.
