Mumbai: The Income Tax (I-T) Department searched 394 suspicious entities and 36 professionals, including CAs, across the country, including six firms in Mumbai, for allegedly remitting large amounts of foreign exchange.Among the searched entities 117 were located in districts-states along the country’s land borders that had remitted significant amounts of money abroad, said the I-T Department in a press released issued on Tuesday.Sources stated that the searched premises included a firm engaged in software business in Mumbai suburbs and a firm engaged in engineering work.On Tuesday, the I-T Department launched a nationwide detailed verification exercise to verify these foreign remittances, focusing on shell entities, the persons behind them, and the professionals who issued Form 15CB certificates, mandatory for foreign remittances.The I-T Department said, in the press release, that a nationwide network of entities engaged in remitting funds abroad was uncovered during a search operation of a group of fictitious charitable trusts involved in providing accommodation entries against bogus donations or contributions.During the investigation, I-T officials found that the entities making the foreign remittances were not filing tax returns or filing income-tax returns showing very small turnovers. They also found that the turnovers shown by them had no apparent correlation with the large amounts of money being remitted abroad.The officials found that many of the searched entities were not actually operating from the addresses declared by them and also they had provided misleading information. The I-T Department said their declaration did not match the stated purpose of the remittances, such as payment for freight, import of software, or import of consulting services.Earlier, the I-T Department checked on the fictitious charitable trusts who were registered outside Mumbai or in other states, which led them to the suspicious entities. The sources also stated that the CAs were covered in the search for issuing suspicious tax determination certificate for foreign remittances from India (Form 15CB).The I-T Department said that further analysis of the data revealed that a large number of Form 15CB certificates were issued by a relatively small group of professionals, and the remitted funds were also received by a clustered group of entities.Officials suspected that the Form 15 CB certificates were issued without adequate due diligence and without verifying its taxability with reference to the books of account and other relevant documents.
