The Income Tax department on October 28 held searched at 22 locations of a Tamil Nadu-based group running multiple educational institutions, leading to detection of alleged tax evasion worth about Rs 150 crore. With the search currently in progress, cash amounting to Rs 5 crore has been siezed.
According to reports, the institutions come under Nandha Educational Institutions run by founder-chairman V Shanmugan. Others connected to this raid include R Krishnan, DMK's Coimbatore urban district west unit in-charge and V Sathya Moorthy, an engineer who owns a private construction company. The action was undertaken on the basis of information that fees collected from students were "not fully accounted for" in the regular books of accounts.
"Evidences found during the search reveal that the allegations regarding suppression of fees received are true and the unaccounted receipts are siphoned off to the personal accounts of the trustees, which in turn are invested in real estate through a company. The other shareholders of the company, like an architect from Tirupur and a textile businessman, were also covered," the statement from Central Board of Direct Taxes (CBDT) said.
CBDT, the administrative authority for the Income Tax (I-T) department, said the searches were conducted on Wednesday at 22 premises in Coimbatore, Erode, Chennai and Namakkal of the group and their associates, including a civil contractor.
"The search has led to the identification of unaccounted investments and on-money payments to the extent of around Rs 150 crore. Cash amounting to Rs 5 crore has been seized. Some lockers are yet to be operated. The search is still continuing," the statement from Surabhi Ahluwalia, Commissioner of Income Tax (Media and Technical Policy) and the Official Spokesperson of CBDT, added.
The electronic devices seized are also being examined, it said.
In the case of raid on the civil contractors from Namakkal, inflation of expenditure by booking "bogus expenses" under labour charges, material purchase, etc. has been found. "During the searches in the case of the civil contractors from Namakkal, inflation of expenditure by booking bogus expenses under labour charges, material purchase, etc. has been found," the statement added.
(With inputs from PTI)