Indian diamond exporter under Income Tax radar

The Income Tax department carried out search operations on premises connected to a leading diamond manufacturer and exporter from Gujarat and seized a large volume of unaccounted data. The raids, which began on September 22 based on intelligence input about tax evasion, continues to be in progress, as per a Times of India report. 
The operation covered 23 premises located in Surat, Navsari, Morbi, Wankaner in Gujarat and Mumbai in Maharashtra. The highlight of the search includes the seizure of a large volume of unaccounted data seized in the paper as well as digital form, which was kept at secret locations under the custody of its trusted employees at Surat, Navasari, Mumbai.
According to the report, the primary analysis of data reveals that the assessee has made unaccounted purchases and sales of small polished diamonds of about $70.96 mn over a period. Further, the data reveals that the assessee has sold more than $13.01 mn of diamond in cash generated from its manufacturing activities, which remains unaccounted for while it is its income.
As per the ministry, the assessee was also making its major purchases of rough diamonds through imports and making export sales of finished bigger diamonds through its company registered in Hongkong, which is effectively controlled and managed from India.

Aruna Gaitonde, Editor in Chief of the Asian Bureau, Rough&Polished