The income tax (I-T) department conducted a search and seizure operation against a major producer of beer and IMFL in Tamil Nadu, unearthing tax evasion worth Rs. 700 crore, an official statement said.
‘The search action was launched in the early hours at 55 premises in various places in Tamil Nadu, including Chennai, Coimbatore, Thanjavur, etc and also in Kerala, Andhra Pradesh and Goa,’ an official statement said.
The premises included residences of the promoters, key employees and some of the suppliers of materials, it said.
‘The search action was based on intelligence gathered over several months that the business group was indulging in large scale tax evasion by inflating its expenditure on materials used in its production processes,’ it said.
The modus operandi involved over-invoicing of purchase of raw materials and bottles which constituted a major portion of the cost of production. The suppliers received payment at the inflated value by cheque or RTGS, but paid back the excess value in cash to key confidante employees of the group, it said.
Such inflation by over invoicing amounted to suppression of taxable income of almost ₹400 crore over a period of six years.
The search also resulted in unearthing of evidence of similar tax evasion by another leading business group in the same liquor industry, it said.
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