Income Tax Department busts hawala racket of Rs 3,300 crore involving infra firms

On Monday, the CBDT has claimed that the Income Tax Department has busted a hawala racket worth Rs 3,300-crore. The hawala racket is said to be spread across multiple cities such as Delhi, Mumbai and Hyderabad with links to "leading corporate houses" in the infrastructure sector.

According to News18, the raids to unearth the large tax evasion nexus were conducted in the first week of this month on 42 premises in Delhi, Mumbai, Hyderabad, Erode, Pune, Agra and Goa on a group of people indulging in issuing bogus bills and carrying on hawala transactions. “The search operations resulted in busting of a major racket of cash generation by leading corporate houses in the infrastructure sector through bogus contracts/bills,” an official release said.

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"The search action was successful in unearthing incriminating evidences and establishing the nexus between big corporates, hawala operators and identification of entire chain of delivery, as well as siphoning of funds by way of bogus contracts to the tune of Rs 3,300 crore," the CBDT told the News18.

Funds meant for public infrastructure projects were siphoned off through entry operators, lobbyists and hawala dealers. The companies involved in siphoning of funds are mostly located in NCR and Mumbai. One such company was earlier searched by Income Tax Department in April, 2019, the release added.

The Board, the policy-making body for the I-T department, however, did not identify the entities raided. The companies involved in siphoning of funds are mostly located in the national capital region and Mumbai, it said. One such company was earlier searched by I-T sleuths in April this year, the statement said.

The projects are involved in bogus billings are major infrastructure and EWS (economically weaker section) projects located in Southern India. Evidence of cash payment of more than Rs. 150 crore to a prominent person in Andhra Pradesh has also been unearthed during the search.

The search action was successful in unearthing incriminating evidences and establishing the nexus between big corporates, hawala operators and identification of entire chain of delivery, as well as siphoning of funds by way of bogus contracts to the tune of Rs. 3300 crore. Unexplained cash of Rs 4.19 crore and jewellery in excess of Rs 3.2 crore was also seized during the search operation, the release said.