Income Tax raids point to evasion by distillery

The Hindu : Tamil Nadu News : Income Tax raids point to evasion by distillery: official: "Union Minister of State for Finance S.S. Palanimanickam, he said the raids, code named `Operation Diet,' were conducted on Wednesday on some 12 to 15 premises and lockers of the two directors and former managing director of Midas Golden Distilleries in Chennai.

About Rs.11 lakhs in cash and jewellery worth Rs.31 lakh were seized during the operation. Noting that the amount suspected to have been evaded would run into several crores of rupees, Mr. Datta, who is also the Director General IT (Investigation), reasoning for the raids said the Department had information that the company was not reflecting its proper income.

Naming (Dr) Shivakumar and Revana as the two directors and Kittappa, the former managing director of the company, as the persons whose premises were raided, he said the Department was looking into the investments in the distillery, its expenses that appear "inflated" and the returns filed.

The company's turnover had risen sharply from Rs.146 crore in 2003-04 to Rs.479 crore and around Rs.600 crore in the next two financial years, he added. He, however, replied in the negative to a query on whether the Department found any foul play in the awarding of the contract by TASMAC to the company and the involvement of those close to the Chief Minister, Jayalalithaa, and her friend Sasikalaa or directors of Jaya TV. Further investigation, he said, would be conducted to look into excise duty evasion and benami investments in the company and the Department would take a couple of months to issue summons."