BHUBANESWAR: DN Group, one of the state’s rapidly-growing real estate companies, came under investigation of Income Tax (IT) department which on Wednesday swept through its property over alleged discrepancies in business dealings and seized cash worth over Rs 10 crore during the operation.
The IT sleuths searched around 30 locations linked to the group in the capital city and other parts of the state. “More than Rs 10 crore in cash has been seized and further investigation is continuing,” said sources. The cash was reportedly seized from a government quarter in Unit-IV area which was rented by a staff of the company which has expanded its footprint into retails, entertainment, education, hospitality and infrastructure.
Sources said the IT department had received information the company was allegedly selling flats under three of its housing projects at higher prices while executing registration at benchmark valuation. The department is probing if it accepted substantial portion of sale proceeds (35 per cent to 40 per cent) in cash which remains unaccounted in books. The cash generated from one project was invested to purchase of land for another venture, said sources.
Besides, DN Group’s balance sheet too was under scanner as it allegedly showed low net profit ranging from 1.6 per cent to 5.19 per cent which the IT department suspects is much below the market standards in this sector.
The department had information that M/S DN Homes Private Limited, one of the several entities of DN Group, received unaccounted investments in its ongoing mega projects like a five-star hotel in Bhubaneswar and two hotels-cum-spas at Satapada and Gopalpur. The IT department is also investigating if the company received unaccounted investments in construction of a five-star hotel and a mall at Patrapada and a school having two campuses in the capital.
Similarly, DN Wisdom Tree Global School, run by Dasarathi Naik Foundation for Excellence, also came under IT probe. The company apparently has not shown the school building as its asset. The total value of the assets for the projects is suspected to be under-disclosed due to investment of unaccounted cash in them. The company has received over Rs 99 crore loan and the IT department is verifying the transactions.