The investigation wing of the income-tax department, which raided 34 premises in a nation-wide operation on Monday, have confiscated evidence showing false claims of around Rs 10 crore availed by the company under section 80IA of the Income-Tax Act.

The section deals deductions in respect of industrial undertakings set up on or after April 1, 1991. Sources in the revenue department disclosed that the company obtained the benefits under the section 80IA without actually setting up an industrial undertaking.

The raids which covered 19 places in Mumbai have also lead to a seizure of Rs 0.55 crore. The money was seized from some persons connected with the company, said an income-tax official without disclosing the details of these persons.

Bogus billing claims of around Rs 1.5 crore have also be unearthed by the department. The searches carried on 34 premises included12 residential and seven office premises in Mumbai while the remaining 15 office premises raided were in various parts of the country including Vapi, Silvassa, Ahmednagar, Baroda and Delhi.

The department has also sealed 40 lockers Monday. The search operations involved a Bombay Stock Exchange broker Anuj Sheth and a clearing house agent (CHA). It is learnt that the search at the broker's office was based on a contract note found at the company's premises. According to BSE sources, the broker had transacted a deal of about 19,000 shares of the company a couple of months ago. However, since the deal was purely one which had all records in place including that of the income tax paid on the brokerage earned, the officials did not sieze any documents.

The department has also alleged some manipulation in claiming deductions under section 80HHC (allowing 100 per cent tax incentives for exports) and some questionable sale and lease back deals with some state electricity boards.

"It will take us some time toconfirm the manipulations in deductions claimed under section 80HHC", said sources while adding that the department is awaiting the arrival of two top Sun Pharma officials from Switzerland and China.

The news, however, left a negative impact on the stock's performance on the local bourses on Tuesday. The stock shed 5.37 per cent to close at Rs 296 on the NSE.