Income Tax Department raids properties of pharmaceutical company in Haryana, Delhi-NCR

The Income Tax Department conducted search and seizure operations on a pharmaceutical group, which covered 25 premises in Delhi-NCR and Haryana.

Representative image.

The Income Tax Department has carried out search and seizure operations on a group engaged in the manufacture and distribution of pharmaceutical drugs and real estate development, the Union Finance Ministry said on Friday.

The income tax department carried out the search and seizure operations on June 29. The search action covered 25 premises in Delhi-NCR and Haryana.

A large number of compromising documents in the form of loose sheets and digital data were found and seized. These documents reveal that the group was involved in huge unrecorded sales of pharmaceutical drugs in cash. Large amounts of shopping, salary payments and other expenses were also made in cash, the ministry said.

This modus operandi of unrecorded cash sales of pharmaceutical drugs, including cash receipts through hawala for the sale of drugs to Afghanistan, was admitted by a key person involved in these transactions.

Preliminary analysis of the data entered indicates that these hawala cash receipts amounted to around Rs. 25 crores. In the case of a pharmaceutical company specializing in Active Pharmaceutical Ingredients (APIs), excess stock valued at Rs. 94 crores was found.

It is also found that cash generated from unrecorded cash sales was invested in the purchase of real estate and the expansion of pharmaceutical drug manufacturing facilities.

The real estate entities of the group were found to be engaged in the off-book sale and purchase of properties for cash. The group had also recorded false long-term/short-term capital losses in the securities market to offset the capital gains made on such real estate transactions.

The amount of these fake losses is estimated to be around Rs. 20 crores. The search action revealed that the group also launched benami entities to buy real estate properties in Himachal Pradesh.

So far, unaccounted cash of Rs 4.2 crore and jewellery/bullion worth Rs four crore have been seized.

Further investigations are in progress.

Also read: Four detained for conducting fake tax raid in Delhi

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