The five-day long searches conducted by the Income Tax department on the houses of various companies and individuals related to Telugu Desam Party since February 6 led to the unearthing of a major scam worth more than Rs 2,000 crore.
An official statement from the I-T department on Thursday revealed that the searches were conducted on three prominent infrastructure groups based in Andhra Pradesh and Telangana.
“Search operation was also carried out on close associates including expersonal secretary of a prominent person and incriminating evidence seized,” the statement said.
Though the statement does not mention any names, it was pretty evident that the companies were related to Telugu Desam Party’s Kadapa district unit president R Srinivasulu Reddy and Kilaru Rajesh, a close friend of TDP general secretary Nara Lokesh, on whose houses and offices the IT authorities have been raiding since February 6.
And the ex-personal secretary of the “prominent person,” is none other than Pendyala Srinivasa Rao, who served as PS of TDP president and former Andhra chief minister N Chandrababu Naidu.
Ahluwalia said searches had been conducted in more than 40 premises in Hyderabad, Vijayawada, Kadapa, Visakhapatnam, Delhi and Pune since February 6.
Investigations led to busting of a major racket of cash generation through bogus sub-contractors, over-invoicing and bogus billing, she said.
“Several incriminating documents and loose papers were found and seized during the search, apart from emails, WhatsApp messages and unexplained foreign transactions were unearthed during the search,” she said.
The search operations revealed that infrastructure companies had subcontracted work to several non-existent and bogus entities.
Preliminary estimates suggest siphoning of more than Rs 2,000 crore through transactions that were layered through multiple entities with the last in the chain being small entities with turnover less than Rs 2 crore to avoid maintenance of books of accounts and tax audits etc.
“Such entities were either not found at their registered address or were found to be shell entities. Several such sub-contractors were controlled by the principal contractors with all their Income Tax Return filings and other compliances being done from the IP addresses of main corporate office,” the official said.
Besides, FDI receipts of several crores in the group companies of one of the Infrastructure companies is suspected to be round-tripping of its unaccounted funds.
“Unexplained cash of Rs 85 lakh and jewellery worth Rs 71 lakh have been seized and more than 25 bank lockers have been restrained,” the IT spokesman said.
