Income-tax Department’s searches in NCR, Haryana & WB reveal large scale under-invoicing of imports
An importer and trader of laptops, mobile phones, and peripheral parts was subjected to search and seizure by the Internal Revenue Service. On October 10, 2021, the search operations began in the National Capital Region, Haryana, and West Bengal.
Several damning documents, diaries, and digital evidence were discovered during the search, revealing that the group is involved in large-scale under-invoicing and fraudulent declaration of products imported by it. A substantial amount of evidence indicating unrecorded transactions, unexplained property investments, fake loans made, and so on has also been acquired.
The modus operandi entails the importation of products in the names of shell corporations at low prices and/or the erroneous declaration of the commodities imported’s description, all with the goal of evading customs duty. Such products have been discovered to be dispersed throughout India via out-of-books cash transactions after clearing at port(s). This point was reinforced by an examination of one of the containers at Kolkata Port, where the bill of lading stated that the commodities were ‘HDMI cables’ for Rs 3.8 lakh. However, after de-sealing and checking the package, it was discovered that the actual products imported were high-value items such as computers, mobile phones, and other electronics worth Rs. 64 crore.
Payments for such under-invoiced products to international consigners were paid through hawala channels, according to evidence discovered and confiscated during the search. Almost the entire firm has been discovered to be run in this manner.
Though the value of imports declared at the port of entry by the use of such shell organisations has been around Rs. 20 crore in the last three years, considering the degree of enormous undervaluation identified, it is believed that the actual value during this period might be more than Rs. 2000 crore.
The wealth gained has been utilised to purchase high-value immovable properties, conceal funds in the form of fictitious rental income and fictitious unsecured loans, and make deposits in overseas bank accounts.
Unaccounted cash of Rs. 2.75 crore was discovered during the search.
More research is being carried out.