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I-T searches offices of Hero MotoCorp, chairman Munjal
The income tax department on Wednesday carried out searches at 25 premises of two-wheeler maker Hero MotoCorp Ltd, including offices and the residence of chairman Pawan Munjal and other senior executives, tax officials said
The income tax department on Wednesday carried out searches at 25 premises of two-wheeler maker Hero MotoCorp Ltd, including offices and the residence of chairman Pawan Munjal and other senior executives, tax officials said.
The searches were conducted in Delhi, Gurugram and other locations in north India, the officials added, requesting anonymity.
The frequency of such operations by the income tax authorities has intensified of late, with the department having searched offices and residences of real estate companies—Omaxe Ltd and the Hiranandani Group—in just the past week.
Searches at offices of some startups have also been reported.
The government’s direct tax collections, including corporation tax and personal income tax, has exceeded the revised estimates for the year ending 31 March by ₹1.13 trillion. However, non-tax revenue generation from asset sales and other avenues has fallen far short of its ambitious estimates.
Hero MotoCorp termed it as a routine inquiry by the tax authorities.
“Officials from the income tax department visited two of our offices in Delhi and Gurugram and the residence of our chairman and CEO Dr. Pawan Munjal on Wednesday. We have been informed that this is a routine inquiry, which is not uncommon before the end of the financial year,” the automaker said in a statement.
“We reassure all our stakeholders that it continues to be business as usual. We at Hero MotoCorp are an ethical and law-abiding corporate and maintain the highest standards of impeccable corporate governance. In keeping with this philosophy, we are extending our full cooperation to the authorities,” the statement added.
On Wednesday, shares of Hero MotoCorp fell 1.07% to ₹2,395.40 on the BSE, underperforming a 0.53% drop in the benchmark Sensex.
“The I-T searches are to verify certain suspected bogus expenses booked in the books of Hero MotoCorp but also in books of some of their related parties. The taxman could not understand some of the expenses booked for events, in-house expenses. The exercise is to verify those,” said a person familiar with the matter.
The income tax department did not disclose the reason for the searches since the search operation is still underway.
“The tax department will give clarity only once the operation is over,” said an IT officer, on condition of anonymity.
Hero MotoCorp claims to be the world’s largest two-wheeler maker and has a more than 50% market share in the domestic motorcycle market.
The company recently entered the electric vehicle segment with a new brand as part of its plan to switch to cleaner technology. It will start selling its first electric vehicle in July under the Vida brand with deliveries commencing later this year.
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First Published:23 Mar 2022, 11:13 AM IST
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