Income Tax Department raids showrooms and residences of top fashion designers
On the evening of May 29, the Income Tax Department raided residences and showrooms of a number of India’s best known fashion designers to investigate large cash transactions that are unaccounted for.
Designers including Ritu Kumar, Rohit Bal, Tarun Tahiliani, and Shantanu and Nikhil found their personal homes and business premises raided by the Income Tax Department on Tuesday night. The raids had been scheduled to take place at the same time across New Delhi. The Times of India reported that a total of 25 establishments across both North and South Delhi were raided.
During the raids, sales records, computers, laptops, and other evidence was seized by the Income Tax Department for review and to compare to the tax returns filed by the respective designers. The department is checking whether or not the designers have falsified sales records in order to be eligible to pay less tax.
The Finance Ministry has a rule that the maximum value transaction that can be paid for in cash is Rs two lakh ($3,000). The Ministry suspects that the designers in question have been taking cash payments over the two lakh limit in order to be able to declare a lower sales volume for tax. Further procedures will take place after the seized documents have been properly reviewed.
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