Polycab India Ltd share price this week: PIL faces 21% stock price plunge amidst Income Tax Raid revelations

In the wake of a substantial 21 percent decline in its stock price on January 11, Polycab India Ltd (PIL) responded to the recent income-tax raid revelations. On the same day, PIL disclosed that it has yet to receive any written communication from the Income Tax Department regarding the outcome of the searches conducted on its premises in December.

The company clarified that the stock exchanges have sought clarification about news reports related to income tax searches, but as of now, no official communication has been received. This clarification followed the sharp decline in Polycab India shares on January 11, resulting in the erosion of Rs 15,485.96 crore from its market valuation.

Additionally, the Income Tax Department, which conducted the search operation, reported the discovery of a significant amount of “incriminating evidence,” including physical documents and digital data. The evidence allegedly exposes PIL’s involvement in tax evasion, with I-T officials alleging unaccounted cash sales, cash payments for unaccounted purchases, and manipulation of expenses to suppress taxable income.

The I-T Department asserted that credible evidence revealed unaccounted cash sales of approximately Rs 1,000 crore by the flagship company. Moreover, it reported the seizure of evidence indicating unaccounted cash payments exceeding Rs 400 crore by a distributor on behalf of the flagship company.

Non-genuine expenses, such as sub-contracting expenses, purchases, and transport expenses, totaling about Rs 100 crore, were also identified in the seized evidence. The department claimed that the search action resulted in determining unexplained transactions undertaken by the distributor for issuing bills without a genuine supply of goods.

The authorized distributor, according to the I-T Department, facilitated certain parties to inflate their purchase accounts, aggregating to about Rs 500 crore. During the search operation, unaccounted cash exceeding Rs 4 crore was seized, and more than 25 bank lockers were restrained.

The overall impact of these developments on Polycab India’s stock in the medium term remains uncertain, as investors closely monitor the unfolding situation and await further clarifications from both the company and the tax authorities.

1 week Historical Data of Polycab India Limited (NSE) –