The Income Tax Department alleged to have detected fictitious transactions of rupees 2,200 crore two days after conducting searches at Dainik Bhaskar media group on Saturday.
The raids were conducted at 20 residential and 12 business premises in nine cities including Mumbai, Delhi, Bhopal, Indore, Noida and Ahmedabad on July 22.
The Income Tax Department in a statement said that unpaid taxes worth rupees 700 crore over six years that is violation of rules prescribed by Securities and Exchange Board of India (SEBI) and evidence that profit was draw off.
The statement also alleged that the Dainik Bhaskar media group have been operating several companies and had named some of its employees as shareholders and directors who were not aware of such companies.
The income tax department claimed, "Such companies have been used for multiple purposes namely; booking bogus expenses and siphoning off the profits from listed companies, routing of funds so siphoned into their closely held companies to make investments, making of circular transactions etc. (sic)"
The statement also said, "Cyclical trading and transfer of funds among group companies engaged in unrelated businesses to the tune of Rs 2,200 crore has been found."
The department had also confirmed that these have been fictitious transactions without any actual movement or delivery of goods with the tax effect and violation of other laws is being examined.
The tax department had discovered 26 lockers at the homes of the promoters and key employees of the group that are being operated.
The statement by the IT department also alleged that they have found evidence which indicate receipt of on-money in cash and sale of flats by the reality arm of the media group.
The IT department also wrote that the modus operandi as well as the validate documents have been found.