I-T Dept finds gold, forex worth over Rs 500 cr from self-styled godman

Officials say the department is facing issues in implementation of faceless scrutiny and this could hit tax revenue collections
The Income Tax Department (IT) department has discovered cash receipts worth Rs 409 crore dating back to 2014-15 during a search across properties belonging to self-styled godman, ‘Kalki Bhagwan’. Foreign exchange, gold, diamonds and other assets were also unearthed in the raid, which officials say has so far detected undisclosed wealth estimated to be more than Rs 500 crore.

The Department said tax officials had searched a conglomerate of trusts and companies on October 16, under the Income-tax Act, 1961. The searched entities have been running year-round “wellness courses” and training programmes in philosophy and spirituality, at various sprawling residential campuses in Varadaiahpalem in Andhra Pradesh, and in Chennai and Bengaluru.

The Department said the group, founded by a spiritual guru in the 1980s to promote something called the “oneness” philosophy, has also diversified into sectors such as real estate, construction and sports in India and abroad. The group is managed and controlled by the spiritual leader and founder of the group, and his son.

According to information available in the public domain, self-styled godman Sri Bhagavan, whose actual name is Vijay Kumar and who hails from Vellore district, founded Oneness University, a spiritual school in South India. His movement goes by various names, such as Golden Age Foundation, Bhagavad Dharma, Kalki Dharma and the Oneness Organisation. The headquarters and main campus of the movement is in Varadaiahpalem, Andhra Pradesh. Within the campus is the Oneness Temple.

The Department said the courses attracts spiritual seekers from abroad and that the group earns substantial receipts in foreign exchange. There was intelligence that the group has been suppressing its receipts, and ploughing them into huge tracts of landed property in Andhra Pradesh and Tamil Nadu and in investments abroad.

The search action, which is still in progress, has covered about 40 premises in Chennai, Hyderabad, Bengaluru and Varadaiahpalem.

During the search proceedings, the department found that the group has been regularly suppressing its receipts at various centres or ashrams. Evidence has been found with key employees who maintained record of cash collections that were kept outside the accounts, and were used for making investments elsewhere and for buying properties over and above their documented values. 

It is learnt that the group also earned unaccounted income in cash from property sales over and above documented values. A preliminary estimate of such unaccounted cash receipts, some of which date back to 2014-15, is about Rs 409 crore. Evidence of such unaccounted cash receipts is also seen in the huge quantities of cash and other valuables found at the residences of the founder and his son, and at one of the campuses. A total sum of cash of Rs 43.9 crore has been found and seized by the Department at these premises, the IT Department said.

It was further stated that substantial sums of foreign currencies have also been found and seized. The total of such foreign exchange found at these premises is about $2.5 million which amounts to around Rs 18 crore. Foreign exchange in other currencies has also been found and seized. Substantial quantities of undisclosed gold in the form of jewellery, about 88 kg approximately valued at over Rs 26 crore, has also been found and seized. Undisclosed diamonds amounting to 1,271 carats valued approximately at about Rs 5 crore were also found and seized.

Total value of seizure so far is approximately Rs 93 crore. The undisclosed income of the group detected so far is estimated at more than Rs 500 crore. The search proceedings are still in progress, said the IT Department.

An important finding of the search is that the group has been investing in a number of companies in India and abroad, including in tax havens. Some of these companies based in China, USA, Singapore, UAE, etc are found to be receiving payments from foreign clients who attend the various residential “wellness” courses offered in India. The Department is investigating into diversion of income taxable in India to offshore entities by the group in this process. Further, it is found that one of the group trusts may be providing accommodation entries for other parties by receiving donations from them and then returning the money back under the garb of expenses and receiving a small percentage as fee. Instances have also been found where the group is not accounting for money received from foreign clients in cash in foreign currency and then exchanging the same in the grey market. All these leads are being pursued and investigation is in progress, said the IT department.

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