I-T Department cunducts major raids on yarn units

MUMBAI, OCT 6: In one of its biggest operations, the Investigation Wing of the Income Tax department, Mumbai raided 54 premises all over India today, this time targeting manufacturers of texturised yarn and grey cloth.

The IT sleuths unearthed an elaborate network of yarn manufacturers, commission agents and manufacturers of grey cloth, who have been using the device of crossed cheques and drafts to conceal real figures of turnover.

Three undisclosed bank accounts of one of the commission agents, showing Rs 1.37 crore income were seized, and seven bank lockers in all had been sealed till Tuesday evening, IT sources confirmed.

The network, having its origin in the textile town of Bhiwandi, operates as follows: The manufacturer of yarn will sell to the manufacturer of grey cloth through an agent. The manufacturer of grey cloth will further sell to other parties on a totally undisclosed account. The buyers will pay him through crossed cheques or drafts, so he does not show the amounts received from genuinebuyers.

He in turn will pay the yarn manufacturer by the same device, from bogus bank accounts which are held not in his name but of fictitious account holders.