Income Tax Fraud in Hyderabad: Shocking Tax Evasion Scam Uncovered
A shocking case of tax evasion has come to light in Hyderabad, where there has been a significant increase in donations from IT sector employees and professionals to registered but unrecognized political parties. When the Income Tax Department investigated the sudden surge in political donations from the IT sector, they were shocked by their findings.
These IT employees falsely claimed to have donated to registered but unrecognized political parties to avail tax exemptions under Section 80GGC of the Income Tax Act. In return, these political parties would take a certain percentage as commission. The donations were made through cheques or bank transfers, but the money was later returned in cash after deducting the commission.
Rs 110 Crore Tax Refund Scam Exposed
An investigation by the Income Tax Department has uncovered a ₹110 crore tax refund scam, in which IT employees from 36 companies in Hyderabad falsely claimed tax refunds by pretending to make political donations. According to The Times of India, one IT employee with an annual salary of ₹46 lakh claimed to have donated ₹45 lakh to a political party.
Previously, many employees used fraudulent claims related to house rent allowance, education loans, and home loan interest to cheat the Income Tax Department. In 2023, action was taken against government employees in Telangana and Andhra Pradesh for such fraudulent activities. Now, the Income Tax Department has shifted its focus to private-sector employees.
Political Parties from Gujarat, Telangana Involved
The scam was uncovered after the Income Tax Department traced a single email address used by multiple IT employees to claim bogus tax refunds. The investigation revealed that the registered but unrecognized political parties involved in the scam were from Gujarat, Telangana, and other states. These parties had never contested elections or submitted their donation reports to the Election Commission of India.
Income Tax Department’s Appeal
To curb such fraudulent activities, the Income Tax Department has started conducting workshops in major IT and financial companies, educating employees about the misuse of Section 80GGC. The Investigation Wing of the Income Tax Department in Hyderabad organized awareness programs on January 28, 29, and 30, urging employees not to submit fraudulent tax refund claims.
