Undisclosed income of Rs 435 cr detected in mosquito net firm

The searches by Income Tax sleuths at the premises belonging to a firm in Karur that manufactures mosquito nets and specialised textiles netted nearly Rs 33 crore in cash and 10 kg gold, said officials, adding that they have detected undisclosed income to the tune of Rs 435 crore.

Based on intelligence input that the promoters of Shobikaa Impex Private Limited, which is into textile engineering, product development, public health and malaria control, were involved in large-scale tax evasion, several teams of Income Tax investigators carried out searches at its premises from Thursday.

The company is in the business of manufacturing certain specialised materials that are supplied to the health sector, particularly malaria control in Indiaand abroad.

According to a press release from the I-T department, multiple teams of investigators conducted searches at about 20 premises, including residences, factory and office premises. They found and seized unaccounted cash of Rs 32.6 crore and also about 10 kg ofgold jewellery.

The undisclosed income of the company and its promoters is estimated at about Rs 435 crore, therelease added.

It was found during the search that the company has been systematically inflating its expenditure using bogus or fabricated invoices. By booking such non-existent expenditure in its books of account, the company and its promoters have suppressed the true income over the years, the department said.

It was found that the company would pay for such bogus expenses by cheque or RTGS and then get back the money. The unaccounted income generated in this manner was then used to buy immovable properties by making unaccounted payments, further investments in the business as share capital, and in fixed bank deposits, cash and other valuables, the release said, adding that furtherinquiries were on.