The Hindu Business Line : I-T raids on Kolkata hosiery group

THE income-tax department, Kolkata, in a search and seizure operation conducted on Thursday and Friday on a city-based hosiery products manufacturing group, at 26 places in Kolkata, New Delhi and Bangalore, has seized assets totalling Rs 40.70 lakh, including cash and jewellery. I-T department officials declined to name the group.

According to information released by the office of the Additional Director of Income-Tax, Investigations, West Bengal, here, the group was found to have floated hundreds of `paper' companies with its own employees and confidantes as dummy directors, and all these companies are found to be operating from a single "secret" office.

It is further learnt that blank cheque books relating to over 600 bank accounts of various branches at Kolkata, Delhi, Lucknow etc were found, and that a number of cheques contained the signatures of dummy directors.

Huge amounts of cash were also found to have been deposited in many of these accounts.

The group, according to the DG's office, appears to have laundered its unaccounted funds through the medium of raising fictitious share premium accounts in these companies, which were then circulated through layers of its own companies for use as accommodation to others, as well as for investments of the group.

It is learnt that in eight such companies, Rs 193 crore was raised by charging a premium of Rs 190 per Rs 10 share, which was then utilised for investments in software and other advances.

According to the department, some of the directors of these companies have admitted that they were low-paid employees of the group and mere name lenders who signed the cheques and other documents of the company as and when told to do so.

The group was also showing huge exports of hosiery products and garments through some of these fictious companies, thereby, obtaining undue benefits of export incentives.

Evidence was also seized indicating receipts of part of premium of sale of licences in cash, which do not appear to have been accounted for.

The group was also found to have shown payment of fictitious commission amounting to crores of rupees through these satellite companies.

Incriminating papers seized indicate huge investments in immovable properties in prime locations at Kolkata, Delhi, and various other cities.

In Delhi itself, it is learnt, as many as 15 flats/offices and 29 plots in Noida were found to have been owned in the names of either the promoter of the group and his family members, or in the name of the various group companies including the dummy companies.

In Kolkata also, huge investments in real estate were detected, including investment of over Rs 11 crore in a single bungalow.

All bank accounts have been frozen pending verification, and three lockers and two safes, which could not be operated, have been sealed. Further I-T investigations are said to be on.

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