Tobacco manufacturer Godfrey Phillips India’s (GPI's) premises were searched by the Income Tax (I-T) Department for three days between 3 and 7 February. According to a, the raid took place over some financial transactions of GPI promoter and director of Indofil Industries Samir Modi.
Along with GPI, Samir's personal properties were searched as well. The report even suggested that Samir was interrogated for over 20 hours, quoting a top I-T Department source.
“The Company has extended full cooperation to the authorities and will participate in any proceedings, if required,” said the company in its statement.
The raid took place under Section 132 of the Income Tax Act, 1961.
At present, there is infighting within the Modi family over the business of late Krishan Kumar Modi, who handled it for five decades, before his death in 2019.
Samir's elder brother Lalit Modi, IPL founder and now a fugitive who has fled India, does not agree with his mother’s decision to name Samir as the CEO of the company—he even tweeted about this raid.
The dispute reached a point where Lalit decided to file for arbitration in Singapore, dragging mother Bina Modi, who is the president and managing director of GPI, Samir, and sister Charu Bhartia.
Recently, Lalit's son and a director of GPI Ruchir wrote to the corporate affairs ministry, seeking a Serious Fraud Investigation Office and Sebi probe, alleging serious corporate governance issues and other malpractices at the company.
The disagreement started after Krishan Kumar's death. Trustees of the KK Modi Trust—his wife Bina who automatically became the chair of the trust, sons Lalit and Samir, and daughter Charu—were unable to reach a consensus on any issue in running the company. Yet, the decision was taken to appoint Bina as the MD and CEO of GPI. Following this, levelling of allegations and counter-allegations started among the family members.
GPI was originally established in London in 1844, and was one of the first British companies. Today, it is one of the largest cigarette manufacturers, with an annual turnover of approximately Rs 7,200 crore, according to the 2018–19 estimate.