Polycab India shares bleed 22% as IT dept finds Rs 1,000 crore undeclared cash sales

polycab india shares bleed 22% as it dept finds rs 1,000 crore undeclared cash sales

Polycab India shares bleed 22% as IT dept finds Rs 1,000 crore undeclared cash sales

After a brief halt, shares of Polycab India Ltd resumed selloff on Thursday, falling over 22 per cent as the income tax department, in a fresh development, searched Polycab India premises on January 10. As per Ministry of Finance, the officials raided 50 premises of Polycab India in Pune, Aurangabad, Mumbai and Nashik in Maharashtra. Besides, searches are reportedly been conducted in Daman in Gujarat and Delhi.

During the course of the search operation, the Ministry said, a large number of incriminating evidences in the form of documents and digital data have been found & seized. “These evidences reveal modus-operandi of tax evasion adopted by the group in connivance with some of the authorised distributors. Preliminary analysis suggests that the flagship company indulged in unaccounted cash sales, cash payments for unaccounted purchases, non-genuine transport and sub-contracting expenses, etc for suppression of its taxable income,” Ministry of Finance said.

Polycab India shares fell 22.4 per cent to hit a low of Rs 3,812.35 on BSE. The stock hit a 52-week high of Rs 5,722.90 on December 14, 2023, before witnessing weakness amid concerns over IT raids at the company’s premises.

Fresh details

“Credible evidences recovered during the search have established that the flagship company has made unaccounted cash sales of around Rs. 1,000 crore which are not recorded in the books of accounts. Evidences of unaccounted cash payments of more than Rs. 400 crore made by a distributor, on behalf of the flagship company towards purchases of raw materials, have also been seized,” Ministry of Finance said.

Further, the ministry in a release said non-genuine expenses in the nature of sub-contracting expenses, purchases and transport expenses, aggregating to about  Rs 100 crore have also been identified in the seized evidences from the premises of the flagship company.

“The search action also resulted in determination of unexplained transactions undertaken by the distributor for issuing bills without genuine supply of goods whereas such goods have been sold in open market in cash. Thus, the authorised distributor facilitated certain parties to inflate their purchase accounts, which aggregate to about Rs. 500 crore. This distributor exclusively sells products of the flagship company. During the course of search operation, unaccounted cash exceeding Rs. 4 crore, has been seized and more than 25 bank lockers have been put on restraint.

Past IT raids

To recall, Polycab India recently denied reports of tax evasion by the company on stock exchanges and suggested it had not received any communication from the Income-tax department regarding the outcome of December 2023 search operations.

“The company asserts its commitment to compliance and transparency, having fully cooperated with the Income Tax Department officials during the search proceedings in Dec ’23. The company has not received any communication from the Income-tax department regarding the outcome of the search,” it told stock exchanges.

Polycab is the market leader in the cables and wires market. Its exports got sharply risen by 54 per cent YoY in FY23 and accounted for 10 per cent of its sales. Polycab’s exports are spread across 72 countries but its key demand centres are developed countries such as the US and Australia. In the past, Polycab India benefitted from the China +1 policy and also due domestic housing, power and industrial capex growth, Jefferies noted in a report earlier this month.

Watch Live TV in English

Watch Live TV in Hindi

News Related

OTHER NEWS

Aliw Awards nominations out

ALIW Awards Foundation Inc. President Alice H. Reyes has released the names of finalists for the 2023 Aliw Awards to be presented on Dec. 11, 2023, at the Manila Hotel ... Read more »

WhatsApp Web gains the feature of single-view photos and videos

WhatsApp Web gains the feature of single-view photos and videos (Photo: Unsplash) The WhatsApp Web, the desktop version of the popular messaging app from Meta, has received an update allowing ... Read more »

Young athletes’ time to shine in Siklab Awards

Young athletes’ time to shine in Siklab Awards MANILA, Philippines — The future heroes of Philippine sports will be honored during the third Siklab Youth Sports Awards on Dec. 4 ... Read more »

Local exec says 5-10 barangays still isolated in Northern Samar

Graphics by Jannielyn Ann Bigtas A local government official said Monday that five to 10 barangays in Northern Samar are still isolated following the massive flooding in the area last ... Read more »

App made by ex-jeepney driver will let you pay PUV fare, book tricycles

DyipPay app lets you pay jeepney fare, book tricycles “Barya lang po sa umaga.” Everyone who rides jeepneys knows this rule: it may not be an actual law, but it’s ... Read more »

Updated In-Season Tournament Bracket ahead of pool play finale

Updated In-Season Tournament Bracket ahead of pool play finale Tuesday will mark the last day of pool play for the inaugural NBA In-Season Tournament. From there, six first-place teams and ... Read more »

PCG forms teams for maritime emergency response

PCG forms teams for maritime emergency response MANILA, Philippines — Recent incidents of fishermen lost in the waters off Southern Tagalog have prompted the Philippine Coast Guard (PCG) to form ... Read more »
Top List in the World