The income-tax department has slapped showcause and demand notices to the tune of Rs 122 crore on Jagathi Publications, owned by former Congress member of Parliament Y S Jaganmohan Reddy, for mismatching amounts reported in company records.

The notice assumes significance as Jagan Reddy announced a new party -- the YSR Congress Party -- just two days ago. "The matter is with the assessment wing and they are assessing the case," a source said.

Jagathi Publications is into various media activities such as publishing a Telugu daily Sakshi, and running a 24-hour television news channel by the same name. Jagan Reddy reportedly paid Rs 84 crore as advance tax in September 2010, anticipating an income of Rs 500 crore.