Demonetisation: Decoys, airport swoops marked Income Tax crackdown

Posing as customers in jewellery stores and suspected hawala circuits, which were still accepting notes that were no longer legally valid on Wednesday, the investigators reported high-volume sales, particularly at various jewellers.

Written by Ritu Sarin | New Delhi | Updated: November 12, 2016 12:13 pm
rs 500 ban, rs 1000 ban, currency ban, narendra modi, black money, income tax, corruption, modi curb corruption, hawala raid, income tax raid, gold raid, decoy operation, delhi airport, indian express news, india news, business news Income Tax Department Building. (Express photo by Vasant Prabhu)

MINUTES AFTER Prime Minister Narendra Modi ended his address to the nation Tuesday, announcing the withdrawal by midnight of Rs 500 and Rs 1,000 notes to curb corruption and black money, Income Tax sleuths started moving into crowded markets in several cities to track violations of the new guidelines.

Posing as customers in jewellery stores and suspected hawala circuits, which were still accepting notes that were no longer legally valid on Wednesday, the investigators reported high-volume sales, particularly at various jewellers. They indicated that customers were initially paying 20 per cent more cash than the tagged price, going up later to 40 or even 50 per cent of the value of bullion.

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It was this “decoy operation” that finally led to the simultaneous “surveys” across the country on Thursday by the Income Tax Department, including Delhi’s famous “jewellery districts” Karol Bagh and Chandni Chowk; Opera House and Zaveri Bazaar in Mumbai; and large stores in Chandigarh, Ludhiana, Jalandhar, Bengaluru and Kolkata.

The results of the “surveys” are still being compiled but tax officials say their purpose — deterrence — has been achieved.

Early reports show that jewellers and hawala traders in several cities took advantage of the panic in two ways:

# Offering old stocks that did not figure in their account books.

# Offering devalued jewellery items and gold slabs and providing back-dated bills showing amounts below Rs 2 lakh each so that PAN card details need not be filled in.

I-T sleuths are now finalising default cases against at least one jeweller in Delhi from whom Rs 58 lakh in cash was recovered and who had allegedly sold stock worth Rs 2 crore more than what was recorded in the sales register on Tuesday night and Wednesday.

The combined “surveys” in the three cities of Punjab resulted in “extra” (unbilled) sales of over Rs 20 crore.

I-T investigators have also swooped down on hawala traders and “book keepers” who were depositing large amounts of cash brought by jewellers for money-laundering.

“We had planned the decoy operation carefully and it has brought the desired results. There is a scare in the bullion market and the large jewellery districts now, since gold was the easiest commodity for customers to dispose of unwanted cash deposits. The targetted traders have been found to have committed violations on several counts,” said a senior IT official.

I-T sleuths have also reported that since Tuesday night, traders were moving large volumes of banned currency from one city to another. Following a specific tip-off, a passenger from Hyderabad was detained at Delhi airport with Rs 500 and Rs 1,000 currency notes totalling over Rs 50 lakh. On Friday, another passenger from Kanpur was detained at Kolkata airport with Rs 1.1 crore worth of banned currency.

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  1. R
    rajesh
    Nov 12, 2016 at 8:37 am
    How currency switch impacts the financially excluded people?lt;br/gt;The currency switch will result in terrible hardship for low-income groups. This will be mainly because of two facts.lt;br/gt;1. In India, only 28%-32% people have access to financial insutions, including post offices and banks. lt;br/gt;2. 33% of the 138,626 bank branches are in 60 Tier-1 and Tier-2 cities, leaving rural India at a huge disadvantage.
    Reply
    1. A
      ams
      Nov 11, 2016 at 11:30 pm
      How many paaaliticians and big industrialists are caught in this??? ZERO right???? Chaddi sarkar is only publicity sarkar giving hardship to common man and milking each and every story falsely for political gains. These b@@@stars need to be taught a lesson in all upcoming state elections!!!!
      Reply
      1. A
        ashok s
        Nov 12, 2016 at 12:53 am
        Just by giving one example I.t dept is patting its back , shame. They are not averse of practical modus opei. For e.g a Muslims family has large extended members and if they deposits capped amount in each account it becomes white. So our country has potion of this jerks at around 30 to 40 CR's multiple by capped amount you get a figure
        Reply
        1. A
          ashok s
          Nov 12, 2016 at 2:49 am
          Well said and best written comment Mr Joseph r Stephen
          Reply
          1. A
            ashok s
            Nov 11, 2016 at 11:42 pm
            What about builders, they are still doing their business as normal. Their network is more sophisticated then jewellers that I.t will need other machinery to help them
            Reply
            1. T
              T DUTTA
              Nov 12, 2016 at 7:08 am
              ACTION AGAINST BLACK MONEY WILL REMAIN INCOMPLETE WITHOUT TOUCHING THE FILM INDUSTRY
              Reply
              1. T
                T DUTTA
                Nov 12, 2016 at 7:03 am
                CASINOS MIGHT HAVE ATTRACTED BLACK MONEY LIKE MAGNETS
                Reply
                1. T
                  T DUTTA
                  Nov 12, 2016 at 7:03 am
                  DEMONETISATION 12 HOURS BEFORE THE START OF INDIA-ENGLAND TEST SERIES WAS A VERY GOOD MOVE---OBVIOULAY IT MADE CRICKET BETTING SYNDICATE UNHAPPY
                  Reply
                  1. T
                    T DUTTA
                    Nov 12, 2016 at 7:02 am
                    DEMONETISATION JUST AFTER DHANTERAS WAS A VERY BRILLIANT MOVE------IN OUR COUNTRY ONLY A VERY SMALL PERCENTAGE OF 125 CRORE POTION PAY INCOME TAX---BUT BEFORE DHANTERAS THERE IS GATE CRASHING CROWD BEFORE ALL JEWELLERY SHOPS ---obvioulsy black money is used
                    Reply
                    1. T
                      T DUTTA
                      Nov 12, 2016 at 7:07 am
                      FILM ACTORS MUST NOT BE ALLOWED TO TAKE FEES IN CASH-------ALL FEES MUST BE IN CHEQUE OR DEMAND DRAFT OR RTGS/NEFT
                      Reply
                      1. T
                        T DUTTA
                        Nov 12, 2016 at 7:09 am
                        FILM PERSONALITIES MAY BE KEEPING BLACK MONEY ABROAD AND THEY MAY BE PERIDICALLY VISITING THOSE LOCATIONS IN THE NAME OF HOLIDAYING
                        Reply
                        1. T
                          T DUTTA
                          Nov 12, 2016 at 7:04 am
                          PURCHASE OF AIRLINES TICKETS IN CASH ABOVE A CERTAIN AMOUNT MUST BE PROHIBITED
                          Reply
                          1. T
                            T DUTTA
                            Nov 12, 2016 at 7:06 am
                            THERE MAY BE CASH GODOWNS---HUGE AMOUNT OF BLACK MONEY IN CASH CANNOT BE KEPT IN SUITCASE OR ALMIRAHS------
                            Reply
                            1. g
                              guru592006
                              Nov 12, 2016 at 12:56 am
                              Who ever is having dis honest money would be worried. Just see the suggested looters of the country for 70 years lost all his money and was standing in the queue to collect his share of 4000
                              Reply
                              1. H
                                harun
                                Nov 12, 2016 at 9:36 am
                                As long as the people are unwilling to accept the truth ,those who take them for a ride will get away doing it.lt;br/gt;lt;br/gt;Has anyone in the Media ever confronted any BJP Spokesperson about Huge cash which was deposited on the 8th and in October in Party account in Indian Bank in Kolkatta.lt;br/gt;lt;br/gt;Only if you ask will you know the truth.lt;br/gt;lt;br/gt;Let the BJP Atleast give a excuse
                                Reply
                                1. J
                                  Joseph R Stephen
                                  Nov 12, 2016 at 2:33 am
                                  It is known all over India , every citizen was witness how RICH and BLACK MONEY HOLDERS walked into Jewellery shops paid more ans converted black money to GOLD.lt;br/gt;lt;br/gt;It is also known everywhere poor people , middle cl suffered a lot where many would not even pay for their travel, food, hospital bills.lt;br/gt;lt;br/gt;There is no need for DECOYS. The government should have shut GOLD s for 10 days and monitored the gold shops. lt;br/gt;lt;br/gt;If only all the video for last 4 days in every shop is reviewed by IT and all who purchased GOLD are asked to explain then we will know the truth.lt;br/gt;lt;br/gt;It is plain simple the BJP government let this opportunity for black money people to convert to GOLD.lt;br/gt;lt;br/gt;Now with 2000 rps , they will again start playing the black money game.lt;br/gt;lt;br/gt;Next let us talk about Electricity BOARD in most states are so corrupt - they would charge anywhere from 10,000 rps - 25,000 for a small house owner to get a METER connection.lt;br/gt;lt;br/gt;This is hard earned money of citizen converted tto BLACK money by corrupt Departments from TOP TO BOTTOM.lt;br/gt;lt;br/gt;every citizen knows this !!!!! Dont tell me Modi is not aware of this.lt;br/gt;lt;br/gt;Clean your house first, then try to clean the streets, then others houses MODI.lt;br/gt;lt;br/gt;Your house is very dirty , but you keep saying there is black money outside.
                                  Reply
                                  1. N
                                    Niladrinath Mohanty
                                    Nov 12, 2016 at 2:50 am
                                    Indians are ingenuous and also selfish. Their comparatively higher selfishness is one of the major cause of corruption.
                                    Reply
                                    1. H
                                      Hari Pillai
                                      Nov 12, 2016 at 3:07 am
                                      LOL. If currency market can be regulated, Gold too can be.lt;br/gt;lt;br/gt;Gold's value is virtual. You cant eat it, cannot take it to Heaven and even if it is buried with you in the grave, outcomes may not be as expected. So why the craze for Gold? Think we can buy land with Gold? Go to car shop and get one bartering for Gold? Eventually most will have to monetize Gold and that is when the reality strikes and honor is lost.
                                      Reply
                                      1. P
                                        Palengri
                                        Nov 12, 2016 at 3:02 am
                                        Very Good!!!!. But the Government officials both from the Central Government and State Government such as Property Registration, Customs, Central Excise, s Tax insist that they oblige provided the concerned re ready to pay their "cut" in the new 2000/-Rupee currency notes!!!AS reported by some news papers that property registration Karnataka has gone down by 20%, reason being the new demands by the registars and Bangalore Corporation Authorities.
                                        Reply
                                        1. V
                                          Vihari Naidu
                                          Nov 12, 2016 at 4:21 am
                                          The bureaucrats can misuse their powers now and har small businesses for bribes too. Should have changed IT officials along with the notes.
                                          Reply
                                          1. S
                                            Support Modi
                                            Nov 12, 2016 at 5:28 am
                                            Great point Baapeji. If only more people in Canada and UK were like you.
                                            Reply
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