Proof of Rs 700 cr tax evasion found during raids on Dainik Bhaskar Group: IT Dept

"During the search, it was found that they have been operating several companies in the names of their employees, which have been used for booking bogus expenses and routing of funds. During the search, several of the employees, whose names were used as shareholders and directors, have admitted that they were not aware of such companies and had given their Aadhaar card and digital signature to the employer in good faith. Some were found to be relatives, who had willingly and knowingly signed the papers but had no knowledge or control of the business activities of the companies, in which they were supposed to be directors and shareholders," the tax department said in a statement.

"Such companies have been used for multiple purposes namely; booking bogus expenses and siphoning off the profits from listed companies, routing of funds so siphoned into their closely held companies to make investments, making of circular transactions etc. For example, the nature of such bogus expenditures booked, vary from supply of man power, transport, logistics and civil works and fictitious trade payables. The quantum of income escapement using this modus operandi, detected so far, amounts to ₹ 700 crore spread over a period of 6 years. However, the quantum may be more as the group has used multiple layers and investigations are being carried out to unravel the entire money trail," it added.

"Application of Benami Transaction Prohibition Act will also be examined," it said, adding that violation of rules laid by the stock market regulator Securities and Exchange Board of India (SEBI) for listed companies were also found.

"Cyclical trading and transfer of funds among group companies engaged in unrelated businesses to the tune of Rs 2,200 crore has been found. The enquiries have confirmed that these have been fictitious transactions without any actual movement or delivery of goods. The tax effect and violation of other laws is being examined," the tax department said.

"The listed media company does barter deals for advertisement revenues, whereby immovable properties are received in lieu of actual payments. Evidences have been found indicating cash receipts in respect of subsequent sale of such properties. This is under further examination," it said.