Gorakhpur: The five-day search operation carried out by the Income Tax Department across Gorakhpur and nearby districts concluded on Saturday, uncovering large-scale financial irregularities and suspected tax evasion running into nearly ₹500 crore. The action focused on six prominent business groups with interests primarily in real estate, edible oil, and liquor, where officials say organised evasion had been taking place for years.
During the searches, the department seized around ₹1 crore in cash, jewellery worth several crores, and more than 15,000 pages of documents, including account books, diaries, property papers, investment files, and digital records. Officials believe these materials contain detailed evidence of unaccounted transactions and hidden investments.
In the real estate sector, investigators reportedly found proof of large cash dealings, undervaluation of property registrations, and inflated or misreported construction costs. According to sources, substantial portions of land and construction payments were made off the books and never disclosed in income tax returns.
The edible oil and liquor businesses, meanwhile, are suspected to have concealed profits through manipulated invoices. Documents recovered during the searches point to wide gaps between actual sales and figures recorded in official accounts. Evidence of transactions routed through shell companies and benami accounts has also surfaced in some cases.
A notable feature of the operation was the use of artificial intelligence and data analytics. AI tools were deployed to scan banking transactions, property records, cash movements, and inter-company dealings, helping officials identify complex patterns of fraud and tax evasion.
Investigators also discovered around 15 bank lockers containing jewellery valued at over ₹10 crore, along with documents related to properties not only in cities such as Gorakhpur, Deoria, Lucknow, Kanpur, and Delhi, but also abroad. These assets will be examined separately to verify the sources of funds used for their purchase. If the explanations are found unsatisfactory, the cases may be referred to the Benami Properties Unit.
With the search operation now complete, the Income Tax Department is preparing to issue show-cause notices to the businessmen involved, seeking clarification on the undisclosed income and transactions. Officials indicated that failure to provide satisfactory responses could lead to hefty tax demands, penalties, and legal action, and that further action against other suspected business groups may follow.