Hyderabad: Ramky Group faked Rs 1,200 crore loss to evade tax, says I-T department

U Sudhakar Reddy / TNN / Updated: Jul 10, 2021, 07:20 IST

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After its recent searches on YSRC Rajya Sabha member Ayodhya Rami Reddy-run Ramky Group of Companies, the income tax department has detected an artificial loss of Rs 1,200 crore ‘incurred’ by the group, which, it said, was done to evade capital gains tax. The company has also admitted to unaccounted income of Rs 300 crore and agreed to pay the tax arrears.

Hyderabad: Ramky Group faked Rs 1,200 crore loss to evade tax, says I-T department

The I-T department had carried out a search and seizure operation on the Hyderabad-based Ramky Group on July 6.

HYDERABAD: After its recent searches on YSRC Rajya Sabha member Ayodhya Rami Reddy-run Ramky Group of Companies, the income tax department has detected an artificial loss of Rs 1,200 crore ‘incurred’ by the group, which, it said, was done to evade capital gains tax. The company has also admitted to unaccounted income of Rs 300 crore and agreed to pay the tax arrears.
The I-T department had carried out a search and seizure operation on the Hyderabad-based Ramky Group on July 6.
During the operation, I-T sleuths seized several incriminating documents and loose sheets, indicating the involvement of the group in unaccounted transactions. Ramky Group, promoted by Rami Reddy’s family, had sold majority stake in one of the group concerns to a non-resident entity based in Singapore during financial year 2018-19 and earned huge capital gains.
The department said: “Ramky Group subsequently devised various colourable schemes by means of entering into a series of share purchase, sale, non-arm’s length value subscription and subsequent bonus issuance, etc., with related parties, creating a loss, which was set off against the capital gains earned. The incriminating evidence (documents) has been recovered, which indicates that the loss was artificially created to set off the capital gains (sic).”

The group is also accused of making an incorrect claim of bad debts to the tune of Rs 288 crore on account of related party transactions, which was set off against the aforementioned profits earned.
During searches, incriminating documents relating to this artificial/incorrect claim were found. Unaccounted cash transactions with associates of the group have also been detected during the search, the I-T department said. “The quantum and modus of the same is under examination,” it added.
The group is engaged in real estate, construction, waste management and infrastructure. Ramky Enviro Engineers, the flagship company, is into waste management and is spread across India, while the group’s real estate activities are mainly concentrated in Hyderabad.
Ramky Infrastructure, Ramky Enviro Engineers, Ramky Villas Limited and Ramky Farms and Estates are some of the key companies of the group.

About the Author

U Sudhakar Reddy

Sudhakar Reddy Udumula is the Editor (Investigation) at the Times of India, Hyderabad. Following the trail of migration and drought across the rustic landscape of Andhra Pradesh and Telangana, Sudhakar reported extensively on government apathy, divisive politics, systemic gender discrimination, agrarian crisis and the will to survive great odds. His curiosity for peeking behind the curtain triumphed over the criminal agenda of many scamsters in the highest political and corporate circles, making way for breaking stories such as Panama Papers Scam, Telgi Stamp Paper Scam, and many others. His versatility in reporting extended to red corridors of left-wing extremism where the lives of security forces and the locals in Maoist-affected areas were key points of investigation. His knack for detail provided crucial evidence of involvement from overseas in terrorist bombings in Hyderabad.

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