IT raid reveals huge tax evasion inM’nagar-based paper & sugar mills

Meerut: The Meerut unit of Ghaziabad investigation wing has concluded a large-scale search and seizure operation under section 132 of the Income Tax Act, 1961, allegedly targeting Bindal Paper Mills Limited (BPML) and its associated entities.The raids, which commenced on Wednesday, spanned multiple locations across Delhi, Muzaffarnagar and Bijnor.Pankaj Agarwal, MD of Bindals Duplex Ltd and president of UP Papermill Association, confirmed to TOI about the raid."Around 30-35 premises of Bindal Paper Mills Ltd were raided on Wednesday. The raid expanded to the units of those who were also directly or indirectly associated with the group. We cannot comment on why the IT department conducted these raids. It's a matter of investigation," Agarwal said.According to the officials of the investigation wing, "the operation covered six other major paper mills in Muzaffarnagar -- Bindals Duplex Ltd, Agarwal Duplex Board Mills Ltd, Tehri Pulp and Paper Mills Ltd, Sakumbhari Pulp and Paper Mills Ltd, and Bindal Industries Ltd. Also, the group's sugar unit in Changipur, Bijnor, was subjected to intense scrutiny."The seizures over ₹3 crore in unaccounted cash and jewelry valued at more than ₹20 crore besides documentation for over 50 immovable properties was unearthed during the raids, it added.The officials also revealed that a large-scale scam was unearthed in procurement of raw materials. "Evidence suggests unaccounted purchases of bagasse and other raw materials. Furthermore, bogus purchases exceeding ₹50 crore were detected in the paper segment", as per a source.A major focal point of the investigation is the alleged wrongful claim of deductions totaling ₹171.3 crore under Section 80IA. Statements recorded under section 132(4) from BPML's internal accountant and the GM of the power plant have revealed that the group "failed to maintain separate books of account for their paper, power and sugar units".While the active search phase concluded on Wednesday, the department has transitioned into the post-search investigation stage. The recording of statements from employees and directors is ongoing to map the extent of the financial irregularities.