Cash crunch: I-T dept seizes Rs 145 mn during raids at multiple locations

The Income Tax Department (ITD) has seized around Rs 15 mn in cash during raids at multiple locations, including in poll-bound Karnataka, in the wake of the recent cash crunch in the country, officials said today.

"The total cash seized in these searches is Rs 15 mn and the seized currency is largely in the higher denominations of Rs 2,000 and Rs 500," a senior official said.They said the department raided a number of entities that were found to be hoarding cash in various states.

The officials cited some instances in this context and said searches were carried out against "prominent" PWD contractors in poll-bound Karnataka, who were awarded contracts during January-March this year.

The searches carried out last week led to unearthing and seizure of around Rs 70 mn in cash, mainly from the benami lockers detected during the operations, they said. Over a dozen contractors in Mysore and Bengaluru were covered as part of the action, they said.

The cash was found to be in the denominations of Rs 2,000 and Rs 500 and some of the searched assessees were found to be not maintaining the books of accounts, they said.

The Rs 70 mn seized last week took the total amount of seizure in the poll-bound state since the announcement of election schedule to Rs 110 mn. The taxman has also seized jewellery worth Rs 13 mn from the state.

In the Hyderabad region, the raids were conducted by the department on two realtors that led to a seizure of Rs 51 mn of "unaccounted cash" in the high-value denominations, they said.

In a similar action in Punjab's Khanna district, a group engaged in manufacture and sale of cattle feed was searched and it led to the seizure of cash amounting to Rs 26 mn along with jewellery and bullion of Rs 6.6 mn, the officials said.

The group was making purchases and sales outside the books in cash and was showing a very low-profit ratio and 5 lockers of the group are still under the attachment ordered by the tax authority, they said.

The Central Board of Direct Taxes (CBDT), that frames the policy for the ITD, had recently asked the investigation wings of the department to check the cash crunch crisis after many ATMs across the country went dry.