Bengaluru: Huge cash deposits and loan repayments at Vasavi Credit Cooperative Society have come under the scanner with income tax officials conducting searches in society premises from January 24 to 26.
An official statement release by the department on Friday said they were verifying “such huge deposits after demonetization and preliminary investigations have indicated that a substantial part of these deposits were from undisclosed sources.The release however did not give an exact figure.
The income tax department’s investigation wing seized several documents, and put the total deposits mobilised by the society, as on March 31, 2016, at Rs 200 crore.
Illegal operations
As per the officials though Vasavi Credit Co-operative Society was registered only as a society it was involved in banking operations. Regulatory and enforcement agencies will look into the violations, the income tax department said.
The society that was started in 1991,has its head office at Malleswaram, Vasavi Co-operative Society runs four branches—at Sanjay Nagar, Moodalapalya, Nelamangala, and Gandhi Bazar. It was accepting deposits after enrolling individuals as members for a nominal fee. Subsequently, members could make time deposits, buy cash certificates, and operate savings accounts.
The society however did not comply with statutory regulations viz collecting PAN details of account holders, deduction of tax on interest paid, stated the officials.The society had tied up with a nationalised bank to allow electronic fund transfers.
CEO?under cloud
The society’s CEO was operating an unregistered chit-fund and finance business at the society with help from relatives, as per the I-T department who have said that they have found evidence against him.
Garib Yojana deal
The tax department said those with deposits at such societies could consider putting their money in the Pradhan Mantri Garib Kalyan Yojana to get immunity from tax, penalty and prosecution.
