Contractors are hoarding high-denomination notes, says IT department

BENGALURU: The investigation wing of the Income Tax department in Karnataka has seized Rs 10.62 crore, in all, during this poll season. The officials have also seized jewellery worth Rs 1.33 crore.

Karnataka is going to polls on April 12, and there have been complaints of shortage of cash at ATMs.

The searches carried out by IT officials on several contractors from April 24 to April 26 have yielded Rs 6.76 crore in cash from four contractors in the Mysuru region.The entire amount seized was in higher denomination notes, an Income Tax department pressnote said. The cash found and seized is not reflected in the books of account maintained by the contractors.


The department said that the hoarding of high-denomination currency notes by contractors is one of the reasons for the shortage of currency notes."Intelligence collected by the Investigation Wing in Karnataka, indicated that several contractors were in possession of huge stocks of cash in the higher denominations of Rs 500 and Rs 2000."

Hoarding of huge stocks cash by these persons at a time when cash shortages are reported in some areas in the state raises troubling questions. The bulk of the seizure was made from lockers in benami names, the pressnote said.