City jewellers are under the Income Tax department scanner, with intelligence inputs pointing out that there has been a sudden surge in transactions that show black money is being converted into gold at inflated prices.
A senior I-T official, however, maintained that the raids are only being carried out at specific establishments. “In some cases, it has been found that the jewellers’ stocks were far below what was shown in their books, which meant that there had been outright black money transactions,” said a highly-placed source from the I-T department.
Search operations had been conducted at the Laxmi Road and Paud Road branches of Pranaav Marathe Jewellers, one of the prominent jewellery stores in the city, on December 9. During the search, I-T officials found that Rs 70 crore worth of gold jewellery had been sold out on November 8 and 9, right after the demonetisation announcement.
Operations were planned after Central Board of Direct Taxes (CBDT) chairman Sushil Chandra asked the investigation units to keep a check on suspicious movement of huge cash and other illegal transactions aimed at tax evasion. An I-T official said, “We got a tip-off that the jewellery store had sold out in a mere 24 hours from November 8 midnight. We began our scrutiny and found that the store had never sold jewellery worth Rs 70 crore in a year. Last week, we initiated a search operation and found irregularities in their accounts.”
Marathe Jewellers has more than two current accounts in different banks and had deposited a total of Rs 45 crore in different banks, which is unexplained. In fact, they had not used the PAN number for more than 20 transactions, despite it being mandatory for any transaction exceeding Rs 50,000, said a highlyplaced officer.
Milind Marathe, owner of Pranaav Marathe Jewellers, admitted that I-T officials had conducted a search operation, saying, “But it was a regular operation and has nothing to do with demonetisation. They have checked and verified our transaction records for the current financial year and have found no discrepancies,” he insisted.
During the search, the department found that the jewellery shop had shown them fake bills through September last week and October. “The owner had admitted that they made fake bills to show huge transactions. The bills were generated within 24 hours after announcement of demonetisation. We are checking if a case of money laundering can be registered against the jewelers, which might entail imprisonment,” the source said.
There were also instances of gold being found in excess of what was reflected in the books, suspected to be smuggled gold coming into the system, added the I-T official. Sources said that some jewellery shop owners were not able to show the appropriate details of the gold purchased and in stock to the I-T sleuths during the raids. It is suspected that some black money hoarders have been buying jewellery by giving old Rs 500 and Rs 1,000 notes as well.