Two days after the Income Tax Department raided the Dainik Bhaskar Group, the department on Saturday, 24 July, said in a statement that they have found: Unpaid taxes worth Rs 700 crore over six years, violation of rules prescribed by Securities and Exchange Board of India (SEBI), and evidence that profit was siphoned off.
The statement by the tax department claimed that the media group had named some of its employees as shareholders and directors, who were not aware of such companies.
"Such companies have been used for multiple purposes namely; booking bogus expenses and siphoning off the profits from listed companies, routing of funds so siphoned into their closely held companies to make investments, making of circular transactions etc, (sic)" the statement read.
It further alleged, "The nature of such bogus expenditures booked vary from supply of man power, transport, logistics and civil works, and fictitious trade payables. The quantum of income escapement using this modus operandi, detected so far, amounts to Rs 700 crore spread over a period of 6 years."
The I-T department said that they have found violation of rules prescribed by SEBI for listed companies and that "Application of Benami Transaction Prohibition Act will also be examined".
"Cyclical trading and transfer of funds among group companies engaged in unrelated businesses to the tune of Rs 2,200 crore has been found. The enquiries have confirmed that these have been fictitious transactions without any actual movement or delivery of goods. The tax effect and violation of other laws is being examined," it said.
The I-T department has further said that they have found a total of 26 lockers in the residential premises of the promoters and key employees of the company.
The statement by the I-T department also claimed that they have found evidence "which indicate receipt of on-money in cash, on sale of flats by the reality arm of the group". They wrote that the "the modus operandi as well as the corroborating documents have been found".
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