I-T dept hits a gold mine

BANGALORE: The Bengaluru International Airport (BIA) brought in much prosperity: land prices peaked along the stretch to BIA and in Devanahalli itself, and investors flocked to this forgotten town with pots of money. That was when work was in full swing two years ago.
While politicians and government officials saw this small town as a safe place to park their unaccounted-for monies by investing in land, developers wanted to make hay and the land mafia some quick bucks through land transactions.
But they couldn't escape the income-tax sleuths. In one of the biggest raids conducted on real estate players in Devanahalli and Bangalore on a single day, IT officials had searched 75 premises of developers on August 26, 2008.
In June 2009, officials of the I-T investigation wing submitted the assessment order estimating the income tax evasion to be Rs 100 crore from transactions involving over 600 acres of land. The transactions carried out by politicians and government officials were benami, and also involved two construction majors and an underworld don who is a big player in Bangalore's real estate market.
Devanahalli was untouched by the IT department for over a decade, though land value started booming with the announcement of BIA. "This was the largest operation on a single day as we did not want to do piecemeal work. The tip-offs were credible and after a lot of legwork, 75 premises were raided one after the other. Of them, several premises of developers were searched simultaneously in Bangalore,'' the sources explained.
During investigations, many big and mighty names tumbled out -- all benami -- of politicians and officials who had invested crores of rupees in the lands. The underworld don owns about 500 acres of land in and around Devanahalli and controls the land mafia in the area.
The audit of the accounts of 25 developers disclosed tax evasion to a tune of Rs 100 crore, from transactions involving 600 acres of land. Assessment orders have been passed for recovery of the amount.
Land transactions at Devanahalli had a pattern -- a chain involving developers, goons and farmers -- and in a majority of cases, the land loser got a raw deal.
An investor sitting in Bangalore or developers from Delhi got in touch with the local land developers for bulk land purchase. The city developer turned to operators in Devanahalli -- small-time real estate brokers and goons. They negotiated with the farmers and froze the deals. The middlemen got a heavy cut in the transactions while the investor made some good dealings by paying the farmers less.