Chennai: The Income Tax department has seized at least Rs1.06 billion (Dh57.61 million) in cash, including Rs100 million in new currency, and gold bars weighing 127kg in searches at multiple locations in Chennai.

This is the largest seizure of new currency notes after the old Rs500 and Rs1,000 notes were scrapped on November 8.

The tax department operation had been launched on Thursday here.

Officials said S. Reddy, a contractor working with the state government, has claimed the entire money and the gold as his own and is being questioned.

“127kg gold in 1kg bars and Rs96 crore [Rs960 million] in old currency and Rs10 crore [Rs100 million] in Rs2,000 notes have been seized by the sleuths after the operation,” top tax department officials said, adding, “This is an unprecedented amount that the tax department has seized in recent times.”

The department carried out the searches based on intelligence inputs about the activities of Reddy and few others for the last few days.

Officials said the agency was investigating how the new notes in such a large quantity were stashed by the individual. The bundles of the new Rs2,000 had no banking slips on them.

They said the tax teams had launched operations against at least eight locations of a “syndicate” involved in currency conversion.

The officials said a number of documents related to financial transactions, entries of gold sale and records of sale/purchase have also been seized by the tax sleuths.

At least three people of the alleged syndicate are being questioned while some others are under the radar, they said.

“He [Reddy] is a contractor working with the state government. He is claiming the entire cash and gold to be his own. Further probe is on,” they said.

The tax department, they said, will share the case details with the Enforcement Directorate and CBI for further probe into money laundering and corruption angles.

Some bank officials are also under the scanner of the department.

The tax department had made the largest seizure of Rs57 million cash in new notes in Bengaluru a few days back after which two other central agencies, the CBI and the Enforcement Directorate, had taken over the cases to probe instances of corruption, money laundering and large-scale hawala transactions in the wake of the demonetisation.