The Income Tax Department carried out searches on 14.12.2020 in a group case from Erode in Tamil Nadu, covering 15 premises at Erode and Chennai. The group is a leading civil contractor for Government works, specialised in erecting Seawave breaks along the coastlines and diversified into bus transport, running marriage halls and food masala business.

The highlight of the search is seizure of ₹ 21 crore of unaccounted cash. It was found that the group indulges in inflation of purchases and other work contract expenses. Such inflated payments made to the suppliers and subcontractors are received back in cash regularly. The unaccounted income thus generated comes to around ₹ 700crore, which is ploughed back into real estate investments and business expansion. Out of this, the assessee has admitted to having undisclosed income of ₹ 150 crore, so far.

Overall there is a detection of ₹ 700crore of unaccounted income and a seizure of ₹ 21 crore of unaccounted cash as a result of this search.

Further investigations are in progress.

Unaccounted income exposure after tax searches results in substantial cash seizures and ongoing criminal and tax investigations. Searches across multiple premises of a civil contracting group disclosed a scheme of inflating purchases and contract expenses with excess payments returned in cash, producing approximately Rs. 700 crore of unaccounted income, of which the assessee admitted about Rs. 150 crore; a cash seizure of about Rs. 21 crore was effected and further investigations are ongoing.