Income Tax raids in Haryana, Delhi over instant loans through app

New Delhi, November 17

The Income Tax Department today carried out search and seizure operations in Delhi and Haryana in the case of a fintech company providing instant short-term personal loans through a mobile application.

The searches were conducted on the business and residential premises in Delhi and Gurugram.

During the search, it was revealed that the company had been allegedly charging a high processing fee at the time of disbursement of loans.

“The company is held by a group based in the Cayman Islands. The company has brought in India nominal initial capital by the way of FDI, but took substantial working capital loans from Indian banks. The business model of the company results in high rotation of capital which is evidenced by turnover of Rs 10,000 crore in its first year of operation,” the Finance Ministry said.

The I-T sleuths noted that a repatriation of about Rs 500 crore had been made by the company to its overseas arms under the pretext of buying of services in two years.

“Evidence gathered during the search has revealed that such remittances made to the group companies are either highly inflated or non-genuine. Evidence also indicate that internal web-based application for lending business was controlled from outside India. Statements of foreign nationals have been recorded,” the ministry said. — TNS

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