A CBDT statement alleged that media group, Dainik Bhaskar, has more than 100 companies including the holding and subsidiary companies and that they have been operating several companies in the names of their employees that have been used for booking "bogus" expenses and routing of funds.
"During the search, several of the employees, whose names were used as shareholders and directors, have admitted that they were not aware of such companies and had given their Aadhaar card and digital signature to the employer in good faith.
"Some were found to be relatives, who had willingly and knowingly signed the papers but had no knowledge or control of the business activities of the companies, in which they were supposed to be directors and shareholders," the CBDT claimed.
Such companies, it alleged, have been used for multiple purposes like "booking bogus expenses" and "siphoning off" the profits from listed companies, routing of funds so siphoned into their closely held companies to make investments, making of circular transactions etc.
"The nature of such bogus expenditures booked vary from supply of manpower, transport, logistics and civil works and fictitious trade payables.
"The quantum of income escapement using this modus operandi, detected so far, amounts to Rs 700 crore spread over a period of six years," it claimed.
However, the quantum may be more as the group has used multiple layers and investigations are being carried out to unravel the entire money trail, it added.
The statement said the tax department is probing the violation of certain sections of the Companies Act and Clause 49 of the Listing Agreement prescribed by SEBI for listed companies in this case.
"Application of Benami Transaction Prohibition Act will also be examined," it said.
'Fictitious transactions' of Rs 2,200-crore
The CBDT claimed to have detected "fictitious transactions" of Rs 2,200 crore after the Income Tax Department carried out multi-city raids against the Dainik Bhaskar media group early this week.
It said the searches that were launched on July 22 in nine cities like Bhopal, Indore, Delhi, Ahmedabad, Noida and some others are "continuing and further investigations are in progress."
"The voluminous material found during the search operations is being examined," the CBDT statement issued here said.
"Cyclical trading and transfer of funds among group companies engaged in unrelated businesses to the tune of Rs 2,200 crore has been found. The enquiries have confirmed that these have been fictitious transactions without any actual movement or delivery of goods. The tax effect and violation of other laws are being examined," the statement alleged.
While the statement did not name the group, official sources identified it to be the Bhopal headquartered Dainik Bhaskar group which is involved in various business sectors like media, power, textiles and real estate with a group turnover of more than Rs 6,000 crore per annum.