New Delhi: Shree Cement on Wednesday received a letter from the Office of the Regional Director (NWR), Ministry of Corporate Affairs (MCA), informing about the order for inspection under Section 206(5) of the Companies Act, 2013.
Shree Cement will comply with the directions, the company said in a filing.
In June, there were reports of tax evasion of Rs 23,000 crore by Shree Cement, following which the stock fell 10 per cent. The Central Government may, in violation of the principles of natural justice, take ex-parte action under Section 206(5) of the Companies Act and direct the inspection of the books and papers of the company by an Inspector appointed by it.
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As per reports, in June, Income Tax officials had searched Shree Cement Group’s premises at various places across Rajasthan and seized documents indicating tax fraud of at least Rs 23,000 crore.
Income Tax officials said examination of documents found in the raid revealed that tax evasion of about Rs 1,200 to 1,400 crore was done every year.
The raids took place after IT officials became suspicious of tax deduction claims made by the group.
On the other hand, it was also informed that Central and State Governments suffered losses through fake agreements made by Sarpanch, Gram Panchayat and concerned local bodies and Income Tax Department officials have also seized agreements related to forgery, the report said. .
A team from the Jaipur office of the IT department raided more than 24 locations of Shree Cement in Jaipur, Beawar, Udaipur, Ajmer and Chittorgarh. More than 200 IT officers and policemen were involved in these raids.
According to the IT officials, there were huge irregularities in accounting of coal purchased and payments made for cement production and the department unearthed the fraud with the help of new technology and software, the report said.
Shree Cement had clarified that the survey by the IT department started on June 21 and the company informed the stock exchange on the same day.
Later, when it came to know that some negative and incorrect information about the company and its officials was being circulated in certain sections of the media, it immediately issued a clarification that the company is extending full cooperation to the authorities and the information being circulated in the media is incorrect and without ascertaining the facts with the company.