The Income Tax department on Friday conducted raids at 50 premises belonging to Samajwadi Party MLC Pushapraj Jain (Pammi Jain), who also deals in the perfumery compounds business, and another businessman Babu Mian in Uttar Pradesh's Kannauj.
Babu Mian also deals in the perfume business and lives in Kannauj.
A team of the Mumbai Income Tax Department is conducting the raids.
The names of Pammi Jain and Babu Mian cropped up during the raid at Peeyush Jain's premises who was arrested by the Directorate General of GST Intelligence (DGGI) from Kannauj.
"We had information that they are involved in tax evasion. After gathering more information we conducted searches at their premises," said an I-T official.
Samajwadi Party Chief and former Uttar Pradesh Chief Minister Akhilesh Yadav is also in Kannauj.
As soon as the news of the I-T raid spread, a number of Samajwadi Party workers gathered outside Pammi Jain's house.
Sources have said that they have recovered a few incriminating documents from during the search operation.
The department officials are also questioning the staff of Babu Mian and Pammi Jain. Their statement is being recorded in connection with tax evasion. The I-T official will share the information with other financial intelligence agencies too.
The raids come days after a tax raid on Uttar Pradesh businessman Peeyush Jain uncovered piles of cash and gold.