HYDERABAD: Acting on a tip-off that they have been funding the campaigning of a political party in Karnataka, Income Tax sleuths on Tuesday conducted searches on two prominent textile companies, including the showrooms and residences of their directors, at 20 separate places in Hyderabad, Vijayawada, and Vizag.
The I-T officials raided several branches in Andhra Pradesh early in the morning and collected regular business details like information on sales, stocks and the collected amount via cash and online payments. The I-T officials asked the staff of the accounts departments in both companies to submit log books, payment records, cash vouchers etc.
The agency suspects that the textile companies evaded tax by maintaining separate log books related to cash payments. The I-T officials called the companies’ auditors to ask about the submitted tax returns from the last two years.
According to sources, some key documents related to cash transactions were seized from the residences of the directors and managers of the two companies. They said that some records of the diversion of funds to Karnataka, where the headquarters of the two companies are located, were also seized.
The agency also carried out searches in Karnataka in connection with suspicious large-scale cash transactions in the last two months.
I-T sleuths, on condition of anonymity, said that both the companies have a close connection to a political party in Karnataka, where they allegedly sent money in electioneering. The agency is also investigating whether the companies funded the campaign of a party in the Karnataka elections. They said that the searches will continue for at least another day.