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I-T raids on firms working on Congress’s political campaign finds unaccounted investments worth Rs 7 crore

The Bengaluru-based firm has called this an "outright abuse of tax agencies for political aims".

By: Express News Service | Bengaluru |
Updated: October 17, 2021 8:45:46 pm
The raids also found bogus expenses of around Rs 70 crore. (Representational Photo)

The Income Tax department’s recent raids on digital marketing and campaign management firms in several states, including Karnataka, has unearthed unaccounted investments worth Rs 7 crore and bogus expenses of around Rs 70 crore.

I-T department sources said the firms were working for the Congress to build a political campaign on digital platforms.

In a press statement issued on Sunday, the department claimed that a raid was carried out at 7 locations in Bengaluru, Surat, Chandigarh and Mohali. “In Bengaluru, the raid was conducted at the office of DesignBoxed creative private limited — the image consultancy firm hired by Karnataka Pradesh Congress Committee President DK Shivakumar,” a source said.

The statement read, “Incriminating evidence found reveals that the group has been engaged in obtaining accommodation entries using an entry operator. The entry operator has admitted to have facilitated transfer of cash and unaccounted income of the group through Hawala operators. Inflation of expenditure and under-reporting of revenue has also been detected. The group has also been found to be indulging in unaccounted cash payments.  It is also found that personal expenses of the directors have been booked as business expenses in the books of accounts. Luxurious vehicles used by the directors and their family members are found to have been purchased in the names of employees and entry providers.”

It added, “The second group searched is engaged in Solid Waste Management comprising solid waste collection, transportation, processing and disposal services across the country, primarily catering to Indian municipalities. During the course of the search, various incriminating documents, loose papers and digital evidence have been seized. Evidence found reveals that this group has indulged in booking bogus bills for expenses and sub-contracts. A preliminary estimate of such bogus expenses booked is to the tune of Rs 70 crore. The search action has led to the detection of unaccounted investment in property of about Rs. 7 crore. Apart from this, the search action has resulted in seizure of unaccounted cash of Rs. 1.95 crore and jewellery of Rs. 65 lakh.”

Following the raids, Naresh Arora, the co-founder of DesignBoxed, said, “I want to place on record that the Income Tax raids on DesignBoxed and me and our associates found absolutely nothing — no unaccounted valuables of any kind. We are law-abiding citizens and proud taxpayers. The raids were so obviously political. They targeted me and my colleagues only because we have been working for the opposition and mainly Congress party.”

He added, “Apart from trying to find anything remotely incriminatory against top Congress leaders, the raids were intended to intimidate a self-made professional and political campaign management firm so that they don’t work for India’s main opposition party. It is unfortunate that even after being so powerful the ruling dispensation needs to intimidate those working with the opposition. An outright abuse of tax agencies for political aims is not what democracies do. The harassment we have suffered is not ours alone; it is part of the process of stifling the Opposition through state power.”

The search operations come after I-T department’s recent raids at 47 locations, including the house of a close aide of former Karnataka chief minister B S Yediyurappa which had led to the detection of Rs 750 crore of undisclosed assets.

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