Noida: Income tax sleuths carried out search operations on premises linked to Delhi-based merchant banker Kulbhushan Parashar. The raids were part of a crackdown on alleged irregularities in SME IPOs during a recent rush of stock market listings.It was led by the investigation wing in Noida under the principal director of income tax (investigation), Kanpur. Officials said 20 locations across three cities were covered by over 200 personnel.Officials said the department stepped in after “serious irregularities” began surfacing in SME IPOs, where retail investors were allegedly lured by the promise of high returns. “Certain entities converted IPOs into a structured tool for illicit gains,” an official said.Preliminary findings pointed to violations of regulatory norms and deception of retail investors, particularly middle-class investors who typically participate in small and medium enterprise offerings.Shares, sources said, may have been allotted to relatives, associates and dummy investors, including domestic staff, without genuine financial consideration. These holdings were then allegedly routed, through pre-planned transfers, to the actual beneficiaries. Officials believe this created artificial demand, pushed up prices and drew unsuspecting investors into inflated valuations, allowing a select group to make crores.Officials said documents and digital evidence were seized. Officials said more names could come under scrutiny as the priobe progresses, and details may be shared with the Securities and Exchange Board of India and other agencies.
