Rs 24,647 cr I-T notice: Now, Aamby Valley slapped with a tax penalty

The income tax department has slapped a Rs 24,647 crore demand notice on Sahara's Aamby Valley project for the assessment year 2012-13 after the department added Rs 48,000 crore to Aamby Valley's income, according to a report in Times of India. 

The report further said this will be the biggest tax penalty slapped on any corporate in India.

According to the ToI report, Aamby Valley had shown a loss of about Rs 14 crore in 2012-13. However, a special audit by the income tax department found that the company's 8 special purpose vehicles had made an income of more than Rs 27,000 crore.

The Supreme Court last week set in motion the process to sell Maharashtra-based luxury township of Aamby Valley to recover the dues owed by the Sahara Group to the Securities and Exchange Board of India (Sebi). 

The court, on the advice of amicus curiae Shekhar Naphade, appointed the official liquidator of the Bombay High Court as the agency responsible for valuing the 10,000-acre property and auctioning it.

The court also directed group chief Subrata Roy Sahara, who has been on parole since May last year, to be personally present on the date of the hearing. 

The case relates to two group firms — Sahara India Real Estate Corp (SIRECL) and Sahara Housing Invest Corporation (SHICL) — which had raised over Rs 24,029 crore from 29.6 million investors by issuing housing bonds. Sebi found this to be in violation of its public issue norms and ordered a refund in 2011. The order was upheld by the Supreme Court in 2012. Sebi says the total dues, with interest, exceed Rs 47,000 crore. Of this, the group has remitted Rs 11,477 crore as of February.

In 2010, SIRECL and SHICL, the two entities which ran afoul of Sebi regulations, had invested Rs 6,700 crore in the shares and debentures of Aamby Valley, the company which owns the property. Subsequently, the firms told the Supreme Court they had sold these investments to Sahara Credit Cooperative Society and Sahara Q Shop. Company records showed that a month after being released from custody to attend his mother’s funeral in May, Roy had been appointed an additional director of Aamby Valley.

According to the latest shareholding pattern (December 2015), Sahara Q Shop Unique Products range was the largest shareholder with 43.12 per cent stake, followed by Sahara India Commercial Corp (25.42 per cent) and Subrata Roy (21.6 per cent). The move to sell Aamby Valley to raise funds had been vehemently resisted by the group in the past. It has said this would hamper its efforts to shore up resources for repayment. Separately, the court also ordered Chennai-based Prakash Swamy, the representative of New York-based MG Capital Holdings LLC, to be present for the hearing on April 27 and deposit Rs 10 crore towards cost. The court also directed a red corner notice to be issued against Swamy to ensure he doesn’t leave the country.