I-T dept uncovers irregularities to the tune of Rs 800 crore after raids on Hero Motocorp, others

The I-T department unearthed multiple irregularities, including illegal business expenses, unaccounted cash and transactions conducted through shell companies during raids on Hero Motocorp and linked firms.

The Income Tax Department conducted search and seizure operation at 35 premises connected to leading two-wheeler manufacturer Hero Motocorp, along with a company operating chartered flights and a real estate group based in Delhi-NCR on March 23.During the course of the raids, tax officials unearthed multiple irregularities, including illegal business expenses, unaccounted cash and transactions conducted through shell companies.

“Various incriminating documents and digital evidence have been found and seized, indicating that the expenses ostensibly shown to have been claimed towards business purposes are not fully supported by evidences,” the I-T department said.

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Expenditure aggregating to more than Rs 800 crore has been booked in the guise of purchase of services from a specific event management entity. This entity has allegedly siphoned off the money by way of layering.

In the search, it was also found that 10 acres of farm land in Delhi was purchased through few paper companies. In such transactions, cash amounting to over Rs 60 crore was purportedly involved.“The ultimate/ real beneficiary of the land deal is a prominent person of the automobile manufacturer group. The intermediary who facilitated the said deal has admitted in his statement that major part of the sale consideration was paid in cash,” the I-T department said.Apart from this, several incriminating documents have been unearthed from the premises of persons involved in the real estate business. These contain records of on-money transactions where cash was being received in lieu of sale of units in their various real estate projects across Delhi.

In the case of the company operating chartered flights, evidence related to booking of bogus expenses and non-recognition of income totalling to over Rs 50 crore, rotation of funds and suspicious loans through a dubious NBFC floated by a key person, layering and re-routing of funds through paper companies and claiming bogus interest expenses have also been unearthed.

Undisclosed cash exceeding Rs 1.35 crore has been seized and jewellery over Rs 3 crore has been kept provisionally under restraint.