Tamil Nadu chain of stores underreported Rs 1,000 crore sales: Income Tax dept

Sales of more than Rs 1,000 crore were suppressed over years by a Chennai-based group to evade tax, the Income Tax Department said in a statement on Tuesday, December 7. The raids had been carried out on Super Saravana Stores and Saravana Selvarathnam, though the latest statement notes alleged violations by both groups, it does not take names

The I-T department had carried out search and seizure operations earlier this month, on December 1, on two groups- Super Saravana Stores and Saravana Selvarathnam. It said it seized documents and other incriminating materials which revealed that one group was actively involved in suppressing sales.

“The extent of suppression of sales is found to be more than Rs 1000 crore, over a period of several years. It was also found that the assessee had made unaccounted cash purchases of about Rs. 150 crore in textile division and jewellery division, during the past few years,” the I-T department said

In terms of the second group, the department said during search it found that the group had “obtained bogus bills from a set of parties to the tune of Rs. 80 crore and thereby suppressed taxable income”.

In addition, it said that there was evidence regarding unaccounted purchase of gold, as well as inflating the making charges of jewellery. “In addition, unaccounted rental receipts and the unaccounted scrap sales aggregating to Rs. 7 crore have also been detected,” it added

The I-T department had carried out search and seizure operations who work in retailing jewellery, textiles and home appliances through a popular chain of stores in Chennai, Coimbatore, Madurai and Tirunelveli. A total of 37 premises were covered in this action, it said.

In total, Rs 10 crore was seized as well as jewellery/bullion worth roughly Rs 6 crore. Further investigations are under progress, the Income Tax department said. 

Saravana Superstore is a multi-super market with chains across Tamil Nadu and one of the biggest shopping points for people of Tamil Nadu. The T-Nagar and Purasawalkam shops have huge turnovers and the roads inside and outside the shops are generally blocked with a large number of shoppers.