Zee and L&T are in a hectic situation, after the IT department raid. Recently, the Income Tax department has been conducting a raid at over fifteen offices of Zee company. Not only Zee Entertainment Enterprises Limited but also Larsen and Toubro are on the list. The survey is regarding the information produced by the Goods and Services Tax (GST) department.
What is the raid for?
With a clear explanation, the information is about the input tax credit availed by the Zee group and L&T firm. So the raid is basically about each firm’s input tax credit. On the other hand, ZEEL is on the survey list. Indeed, ZEEL is the entertainment wing of the Zee group. The Income Tax department raid started earlier this Monday. Besides, the raid team says that if they find anything like tax evasion; immediate direct action will be taken against the respective firm.
Meanwhile, the surveys are less comprehensive than the usual IT raids. It will be taking place only during working hours. Also will not be treating private premises.
What is the firms’ counterfactual?
One of the spokespeople from the Zee Group claims that “The officials from the tax department have visited the offices of the company, with certain queries. The concerned officials of the company are providing all the required information and extending complete cooperation”. Having said that, there is no communication from the L&T group side.
As of now, the IT department is using data analytics to go through whether the firm has a legitimate transaction or not. Whereas the GST department and other law enforcement are looking for any tax evasion in the firms.
Why Zee Group and L&T facing a heavy backlash?
Zee network is famous for its business in mass media, broadcasting infrastructure, and packaging. It is under the Essel Group. But on the other hand, the firm faced many allegations in 2020. It is due to the accusation of Essel Group with Nityank Infrapower and Multiventures. As in, the Essel Group’s association is known for its serious fraud after the demonetization.
Besides, L&T is an Indian technology, engineering, construction, manufacturing, and financial service provider. Yet, Serious Fraud Investigation Office (SIFIO) receives complaints against L&T. However, the firm cleared the accusation by saying that they are baseless and without any merit.
As far as we all know, there is still no update from the L&T group regarding the Income Tax department questionnaire.