IT department raids chairman of Royal Plaza hotel for hiding Rs 40 crore overseas
“The Foreign Assets Investigation Units (FAIU) of the Income Tax Department conducted this search for undisclosed assets held by Mittal overseas and possessing overseas black money” , the IT officials said, adding that “in this regard, 18 premises in Delhi, Mumbai and Daman were covered during the search operation.
A search was conducted this month including locations of the Royal Plaza Hotel, Lights Trading and real estate.
According to the Central Commission for Direct Taxes (CBDT), during the search operation, a large amount of incriminating evidence in the form of paper documents and digital data was found and seized. The evidence indicated that the group had placed its undisclosed money overseas in certain low-tax jurisdictions. The group, through a network of companies based in Malaysia, had invested the funds in its hotel business in India.
The amount of these funds is estimated to exceed Rs 40 crore. Evidence collected indicates that the group has invested in a few overseas companies, which were set up specifically for commodity trading, CBDT informed.
The net worth of one such company, including its earnings, was not disclosed by the group in its tax filings for a relevant period. It was further detected that the promoter of the group invested in real estate in a foreign jurisdiction, which was also not disclosed in the tax returns. Additionally, some offshore entities set up for commodity trading have been identified but not reported by the company.
According to the CBDT, the search action also revealed that the group was involved in off-book spot sales in its India operations.
In his marble and lighting business, evidence seized indicates unrecorded cash sales of 50-70% of total sales. An undisclosed excess stock of Rs 30 crore was also found during the search.
In its hotel business, unaccounted sales were detected more specifically in the banquet division, the CBDT added.