The Income Tax Department on Thursday busted a money laundering racket and seized Rs. 120 crore in demonetised notes, new currency and gold.
Officials of the Income Tax department raided the homes of PWD contractors who are allegedly part of the sand mafia in Chennai and recovered 100 kg gold and Rs. 90 crore in cash.
Raids have been conducted at eight places in the city, sources said. Many of them are residential flats that were being used as hideouts.
According to Income Tax officials, three associates — Sekhar Reddy, Srinivasa Reddy and Prem — were involved in these transactions. Around 100 taxmen were deployed for this operation.
Of the cash found, Rs. 8 crore were in new notes, Rs. 65 crore in the banned old notes of Rs. 500 and Rs. 1,000, sources said. Rs. 10 crore in old and new currency is being sorted. The gold, valued at nearly Rs. 28 crore, is in bars of 1 kg.
The Income Tax sleuths were surprised how the three men managed to get Rs. 10 crore in new notes when people were struggling to withdraw cash from banks and ATMs.