Shree Cement gets MCA’s inspection notice after reports of alleged tax evasion
The office of the Regional Director (NWR), Ministry of Corporate Affairs (MCA) has informed Shree Cement about the order of inspection under Section 206(5) of the Companies Act, 2013.
Shree Cement will comply with the directions, the company said in a filing.
According to the I-T officials, there were huge irregularities in the accounts of coal purchased for cement production and the payment made for this and the department detected this fraud with the help of new technology and software.
In June, there were reports of an Rs.23,000 crore tax evasion by Shree Cement following which the stock cracked 10 percent. The Central government can unilaterally proceed to take action under Section 206(5) of the Companies Act and direct inspection of the books and papers of the company by an Inspector appointed by it, in violation of the principles of natural justice.
As per reports, in June, Income Tax officials had conducted searches at the premises of Shree Cement Group in various places across Rajasthan and seized documents indicating tax fraud to the tune of at least Rs.23,000 crore
The Income Tax officials said that a scrutiny of the documents found in the raids has revealed that almost Rs.1,200 to Rs.1,400 crore tax evasion was reportedly done every year. The raids came after the I-T officials doubted the tax deduction claims made by the group.
On the other hand, it was also reported that the Centre and the state governments incurred losses via fake agreements made by the sarpanch, gram panchayat, and the local bodies concerned and the Income Tax Department officials have also seized the agreements related to the forgery, reports said.
A team from the I-T Department’s Jaipur office had raided more than 24 locations of Shree Cement in Jaipur, Beawar, Udaipur, Ajmer, and Chittorgarh. More than 200 I-T officials and policemen were involved in these raids.
Shree Cement had clarified that the survey by the I-T Department started on June 21, and the company had informed the Stock Exchange about the same on that very day.
Later, when it gathered that some negative and incorrect information about the company and its officials was circulating in certain sections of the media, it immediately issued a clarification that the company is extending full cooperation to the officials and the information circulating otherwise in the media is incorrect and without ascertaining facts with the company.
[With Inputs from IANS]
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