June 11, 2019: The Income Tax Department conducted search and seizure operations today on a prominent business group based in Srinagar, covering 8 premises in Srinagar and 1 each at Bangalore and Delhi. The assessee group is engaged in the business of transportation, manufacturing of silk yarn, hospitality, retail trading of Kashmir Arts & Crafts etc.
None of the members of the group is regular in filing their Income Tax Returns. As a one time settlement, the group has got their loans of Rs 170 crores with J&K Bank restructured for a sum of Rs 77 crores, out of which, payment of only Rs 50.34 crores to the J&K Bank has been made so far and balance of Rs 27.66 crores is yet to be paid. During the search, evidence has been detected indicating that the one time settlement of the loan from J&K Bank has been done through the active connivance of a senior J&K Bank officer who was receiving several out of turn promotions.
Furthermore, evidence has also been unearthed indicating that the repayment of Rs 50.34 crores pertaining to the said loan has been greenfielded by the J&K Bank by granting loan of similar amount to an associate who has confessed to his role in layering the entire transaction.
During the search, incriminating evidence has also been found relating to:
• sale of undisclosed property amounting to Rs 22 crores.
• agreement to sell Transport business for Rs 9.10 crores.
• undisclosed profit of Rs 15-20 crores on account of sale of Cold Storage plant at Lassipora. The cost of this project was found to have been inflated to Rs 47 crores instead of the actual cost of Rs 17 crores, for claiming more subsidy from the government by raising inflated and bogus bills. The loan for this project was taken from J&K Bank.
• undisclosed properties at Sonmarg (Rs 2.68 crores), Pahalgam (Rs 3.55 crores) and Bangalore (Rs 1 crore).
• one shop in partnership in Delhi purchased for Rs. 1.02 crore.
During the search, digital evidence found has been seized, analysis of which is in progress.
Source: PIB, Ministry of Finance