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| I-T Dept sees Rs 800-crore tax evasion |
| Press Trust Of India / New Delhi Jun 08, 2009, 00:43 IST |
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The Income Tax Department is probing tax evasion of Rs 800 crore by some stock brokers who are believed to be diverting profits, earned on trading in NSE, BSE and commodity markets, to “non-deserving” clients through manipulation of client-specific codes.
Sources said profits earned or losses suffered by individual market players are being diverted to a “non-deserving” client who has allowed his trading code to be used by a stock broker. The department has estimated that around Rs 800 crore has been siphoned off this way.
“The losses suffered or profit earned by an individual or a company in a day are being diverted to such an entity who is not monitoring his trade regularly and has given his proprietary code to a broker for playing in the market,” sources said.
Brokers and other players who receive these benefits are evading huge taxes and are manipulating their genuine capital earned in a day’s trade, they said. Sources said the I-T Department will now communicate the probe report to market regulator Sebi to gain access to the suspicious codes and other details from the stock exchanges for further action.
According to the I-T Department, the manipulation done by using the client or the proprietary code by the stock brokers is minimal when looked at the surface level. It actually ends up into a huge amount after a day’s business on the stock exchange, as it involves a number of brokers, sources said.
This malpractice is also resulting in generation of black money as well, they said.
“The role of certain players who have been given client codes by brokers is also under the scanner,” sources said.
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