The Income Tax officers raided a city-based cooperative society and found it to be allegedly running a chit fund and dubious transactions operation worth Rs 200 crore with the active involvement of its CEO. The Income Tax department has claimed to have unearthed one of the largest black money scams post-demonetisation.
At the end of search operations at five branches of the credit co-operative society yesterday, the taxman reported the alleged irregularities to the RBI, the Enforcement Directorate, the CBI and state government authorities for further action.
As per the report prepared by the IT officers that the co-operative society headquartered in Malleshwaram had claimed total membership of about 30,000 and deposits mobilised by it stood at about Rs 200 crore, including those before November 8 last year when the note ban was declared by the central government.
During search proceedings, it was noticed that substantial cash deposits and loan repayments were made after demonetisation. The department is verifying such deposits. Preliminary investigations indicate that a substantial part of the deposits is from undisclosed sources.
Officials identified the organisation as V Credit Cooperative Society founded here in 1990.
The officers of I-T dept said that it was one of the largest instances of black money generation by cooperative societies or banks having been unearthed in the wake of the demonetization.
As per the report that while the society was taking tax benefits by virtue of being registered under the State Registrations Act, it was carrying out normal “banking operations” in alleged violation of laws.
It was noticed that whoever approached the organisation for making the deposits, was first made a member of the society for a nominal admission fee. Subsequently, members could make time deposits, purchase cash certificate, operate the savings account, among others. This organisation does not comply with statutory regulations and does not take PAN from the account holders, and it does not deduct any TDS on the interest payment to the account holders.
As per the report that the I-T department suspected that all this was being done by the society to camouflage the real owners of these (suspect) deposits.
The Income Tax department also conducted searches on the premises of the CEO and found that unregistered chit funds and financing was being carried out using the cooperative society as a bank and with the help of the CEO’s relatives.
As per the report prepared by the I-T department had said that it was found that the cooperative banks have been involved in generating and routing of black money on an unprecedented scale post-November 8 when the currency scrap was announced by Prime Minister Narendra Modi.
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