The Income Tax Department said on Monday it carried out search and seizure operations on “two leading real estate groups of Bengaluru and Hyderabad”, engaged in the business of construction, sale and leasing of commercial/residential space, and educational and hospitality services.
The search action covered more than 40 premises located in Bengaluru, Hyderabad and Chennai, the department said in a statement, without naming the firms.
During tthe search operations, several incriminating documents and digital evidences have been seized. The preliminary analysis of seized evidences has revealed that the land owners had entered into Joint Development Agreement (JDA) with a Bengaluru-based developer.
However, the land owners failed to declare the capital gains accruing from the transaction, though completion certificates for the projects have been obtained. The amount of such undisclosed capital gains is estimated at more than Rs 400 crore, it said.
The initial analysis of the seized documents has also revealed that these groups have suppressed income to the tune of Rs 90 crore in respect of the revenue recognizable from the sale of units in real estate. Further, both the groups have indulged in tax-evasion by inflation of expenses in the construction and development business to the tune of `28 crore, having claimed bogus purchases and resorted to over-invoicing of the construction materials.
So far, the search action has led to the seizure of undisclosed cash of Rs 3.50 crore and gold, silver, jewellery worth Rs 18.50 crore. the tax department said.