Income Tax (I-T) Department is investigating possible tax evasion by defaulters of the National Spot Exchange Ltd (NSEL) after discovering that stocks projected by most of them either do not exist or are over-reported.
The I- T Department had conducted nationwide search on the business premises of about two dozen members of the NSEL on August 22. A source said that stocks shown in the cases of defaulters on record in NSEL-accredited store houses were either " non- existent or short in maximum number of cases". According to concerned officials most billbooks, ledgers and accounts of these store houses have been found to be fictitious or under- reported which is a clear case of tax evasion.
Officials said that the I-T Department will now issue summons for production of additional documents to these entities soon as a further probe is conducted.
The department suspects the account books were fudged to dodge the tax net and present a fake picture of activities at these business entities. The department conducted search in cities, including Mumbai, Hyderabad, Ahmedabad, Kolkata, Nagpur, Jaipur and a few other locations.
NSEL, promoted by Jignesh Shah- headed FTIL, is facing the problem of settling Rs 5,500 crore dues to 148 members and brokers representing 13,000 investor clients, after it suspended trade on July 31 on the government direction.
The bourse managed to collect only Rs 8.50 crore till Friday, the last day for pay- in, against the payout of Rs 174.72 crore to be made on Tuesday. For the first settlement (August 20), the Exchange could settle only Rs 92.12 crore out of the scheduled of Rs 174.72 crore payment it had committed to Forward Markets Commission (FMC), which is the chief regulator of forwards and futures markets
Courtesy: Mail Today