Karnataka: IT conducts searches on business group running multiple educational institutes

Source : ANI
Author : ANI
Last Updated: Sat, Oct 12th, 2019, 05:04:21hrs
Representative Image

New Delhi [India], Oct 11 (ANI): The Income Tax Department conducted a search on a prominent business group in Karnataka which runs multiple educational institutions.

A press release from the Central Board of Direct Taxes (CBDT) said, "The Income Tax Department conducted a search on October 9 on a prominent business group in Karnataka which runs multiple educational institutions. During the course of the search, the modus operandi of conversion of seats which were originally to be allotted by merit through counseling by MCC maliciously into institutional quota seats through dropout system has been unearthed."
"Incriminating evidence has been found in the search, substantiating conversion of seats, commission payments to brokers and sale of seats in exchange of receipt of cash. Evidences of use of multiple agents for the conversion of MBBS and PG seats have also been found," the release said.
The press release said, "Overall the total undisclosed income detected so far is around Rs 100 crore considering the cash donations received for 185 seats averaging Rs 50 lakh to Rs 65 lakh per seat and total seizure of undisclosed assets of Rs 8.82 crore. A total of Rs 4.22 crore of unaccounted cash has so far been found including Rs 89 lakh in the house of the main trustee."
The press release further said that certain students whose names were used in the conversion of seats have made statements establishing the modus operandi.
"Agents have admitted to having aided in the sale of seats, brokers have admitted being witness and accomplice to the diversion of such cash generated, the release said.
"Evidence has further brought to light the fact that trustees have opened bank accounts in the names of their employees to deposit some of the capitation fees received in cash. Fixed deposits amounting to Rs 4.6 crore in the names of eight employees made in the above manner has been seized. It was further found that the interest from such Benami fixed deposits have been used to service the loans taken by the trustees in their personal capacity," the release said.
"Further investigations are in progress," it added. (ANI)