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October 16, 2020

Lawyer who took Rs. 217 cr in cash from 2 clients raided by Income Tax Department

by CA Shivam Jaiswal in Income Tax

Lawyer who took Rs. 217 cr in cash from 2 clients raided by Income Tax Department

The Income Tax Department has raided a “leading” Chandigarh-based advocate on charges of alleged tax evasion and receiving at least Rs 217 crore “in cash”, tax officials said on October 15. They said the department raided 38 premises linked to the lawyer in Haryana, Delhi and the national capital region on Wednesday

During the search, cash of Rs. 5.5 crore has been seized, while 10 lockers have been placed under restraint. Incriminating documents of unaccounted cash transactions and investments made by the assessee over several years have been found. Substantial digital data reflecting unaccounted transactions of the assessee and his associates, who are financers and builders, has also been recovered.

The Central Board of Direct Taxes (CBDT), that frames policy for the tax department, alleged that the lawyer in one case “had received Rs 117 crore from a client in cash, whereas he had shown only Rs 21 crore in his records, which was received through cheque”.

In another case, he received more than Rs 100 crore in cash  from an infrastructure and engineering company for its arbitration proceedings with a public sector company, the CBDT claimed.

The unaccounted cash received, has been invested by the assessee in purchase of residential and commercial properties and in taking over of trusts engaged in running of schools. Evidences recovered indicate investment of more than Rs. 100 crore in cash in several properties in posh areas in the last two years. The assessee and his associates have also purchased several schools and properties, for which also more than Rs. 100 crore was paid in cash.

He has also taken accommodation entries (hawala funds) worth several crores, it said. The Board said the search teams have also recovered “substantial digital data reflecting unaccounted transactions of the assessee and his associates who are financiers and builders”.

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