Income Tax Searches Uncover ₹200 Crore Unaccounted Income in Kerala Quarries

Income Tax Department Conducts Searches in Kerala

On January 5, 2022, the Income Tax Department executed a search and seizure operation targeting two groups involved in quarry operations. The operation encompassed more than 35 premises across several districts, including Kottayam, Eranakulam, Thrissur, Palakkad, and Kannur.

Findings from the Search Operation

During the search, investigators uncovered various incriminating documents and digital evidence. This included a separate set of books that documented actual sales and cash receipts. The findings clearly illustrate the operational methods of the quarry operators, indicating significant suppression of cash sales, with many transactions omitted from the group's official accounting records.

Key insights from the evidence suggest that the unaccounted cash generated is systematically utilized to:

• Acquire immovable properties
• Fund cash loans
• Make unrecorded capital investments in other businesses

The search team also uncovered evidence of on-money payments associated with property purchases and substantial cash deposits in undisclosed bank accounts. Furthermore, it was revealed that the assesses of the group have sold immovable properties without properly accounting for the capital gains from these transactions.

Outcome of the Search

As a result of the operation, unaccounted cash amounting to over ₹2.30 crore has been seized.

Additionally, preliminary investigations have estimated the detection of unaccounted income to be approximately ₹200 crore.

Ongoing investigations are expected to provide further insights into these operations.