Income Tax Department Raids BMC Contractors

It has been reported that discrepancies of more than ₹275 crores in the form of bogus expenditure and capital transfers through inflated share premium have been identified so far.

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The Brihanmumbai Municipal Corporation (BMC) which is the richest civic authority in India is in trouble yet again. Amid the ongoing political crisis in Maharashtra and the rift between Shiv Sena and Bhartiya Janta (BJP) Party, the Income Tax department is raiding several BMC Contractors. 

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According to reports, the Income Tax department has begun conducting raids at 27 places on major contractors of BMC. It has been reported that discrepancies of more than ₹275 crores in the form of bogus expenditure and capital transfers through inflated share premium have been identified so far. 

As stated in The Economic Times, Artificial expenditure, with amounts billed well above the actual expense, can not only be a way to lower taxable income but also arrange payoffs. Only a detailed investigation and tracing the money trail will indicate the ultimate beneficiaries. Since some may give political colour to the raid, the I-T department will have to be thorough in establishing its point. 

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