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Business News/ Politics / Policy/  Income tax dept steps up surveillance to crack down on unaccounted use of funds
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Income tax dept steps up surveillance to crack down on unaccounted use of funds

The income tax department steps up surveillance, including in Karnataka, to track down cash hoarders who resort to bogus transactions to generate unaccounted funds

The income tax department’s efforts have so far led to seizure of Rs4.13 crore in cash and gold jewellery of 4.52 kg valued at Rs1.32 crores. Many of these cases are from Karnataka.Photo: MintPremium
The income tax department’s efforts have so far led to seizure of Rs4.13 crore in cash and gold jewellery of 4.52 kg valued at Rs1.32 crores. Many of these cases are from Karnataka.Photo: Mint

New Delhi: The income tax department has stepped up surveillance, including in poll-bound Karnataka, to track down cash hoarders who resort to bogus transactions to generate unaccounted funds.

The move comes at a time several states have reported shortage of currency notes.

The department is now combing through the books of several contractors to see if the expenses reported in the fourth quarter of 2017-18 are unreasonably above that of the previous corresponding quarter, a person with knowledge of the investigations said on condition of anonymity.

Bogus expenditure lowers tax liability of these contractors and the funds are routed back to them who are then not in a position to explain its source, the person quoted above said about the modus operandi followed by some contractors suspected of cash hoarding.

The efforts have so far led to seizure of Rs4.13 crore in cash and gold jewellery of 4.52 kg valued at Rs1.32 crores. Many of these cases are from Karnataka.

“The investigation wing (of the department) has also gathered details of all contract payments made in the last quarter of the completed financial year and are making a comparison with previous years for identifying the abnormal cases. It is also co-relating all the bank transactions, cash withdrawal with the intelligence in its position," said the person.

Out of the total cash seized, about Rs4.03 crore are in Rs2,000 and Rs500 denominations.

Among the cash seizures, the Bengaluru city tops the list with Rs2.47 crore followed by the Bellary at Rs55 lakh, said the person.

Tax officials are keeping a watch over airports and railway stations to track down transportation of large amounts of cash.

The income tax department has set up control rooms in Bengaluru to receive election related complaints from general public and other agencies of the state. It has also formed teams with statutory powers in all districts to act upon any information received, said the official.

Tax sleuths are also monitoring possible cases of inducements to voters by way of distribution of freebies, coupons, fixed deposits with later maturity dates etc.

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ABOUT THE AUTHOR
Gireesh Chandra Prasad
Gireesh has over 22 years of experience in business journalism covering diverse aspects of the economy, including finance, taxation, energy, aviation, corporate and bankruptcy laws, accounting and auditing.
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Published: 21 Apr 2018, 06:25 PM IST
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