Ahmedabad : The income tax department carried out searches at the premises of a real estate dealer who had previously disclosed that he had Rs.13,860 crore of black money

Income tax sleuths also searched the premises of Apaji Amin & Co. LLP, an Ahmedabad-based chartered accountants firm that Mahesh Shah had hired to represent him in the Income Declaration Scheme (IDS) proceedings.

A statement released by Apaji Amin on Friday said Shah was supposed to pay Rs.1,560 crore -- 25% of the tax liability stemming from his disclosure -- as the first instalment by 30 November, but he failed to do so. This resulted in the searches from 29 November to 1 December, the statement said.

An income tax official close to the search operations said: “The departments dealing in IDS and the one that carried out the search operations are different. We had market intelligence that Shah and his business associates were into currency exchange and we carried out the raids in connection following demonetisation. These raids involved his associates, which would have included his chartered accountancy firm. We had no information while conducting the raids that he had applied for income disclosure under IDS scheme. We have recovered documents and not cash from Shah’s premises that were raided."

According to the official, who did not want to be named, Shah’s income tax returns in the last few years ran into a few lakh rupees.

According to Tehmul Sethna, partner of the chartered accountants firm, Shah has not been traceable for the last three days or so. The income-tax department suspected money laundering and conducted the raids, he told journalists on Friday.

Sethna claimed that Shah made a disclosure of ₹ 13,860 crore, all of which was purported to be in cash, under the IDS that ended on 30 September.

He said that his client’s disclosure was the highest under the IDS.

Sethna said he knew Shah from 2013 when he had first consulted him for a land deal, but he was not a regular client.

“A few months ago he approached me and asked me to explain to him the IDS scheme. When he told me that he had such a huge amount to disclose and was ready to pay to the government, I took him to senior IT officials...Till the last day he kept assuring me that he would pay the instalment," Sethna said.

According to Sethna, they had also discussed with IT officials about the transfer of the money which Shah claimed were in different locations. “The IT officials assured my client that necessary arrangement would be made by the government to collect the money at any given location in the country," he said.

While Sethna said that he knew his client was a property investor and did land deals in many parts of the country, it was not until now that he started doubting Shah’s disclosure may not have been genuine.

In his statement to the media, Sethna claimed that income tax officials found only ₹ 29,000 and some papers belonging to Shah in the searches of the chartered accountants firm.

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