NEW YORK (CNN/Money) - Dennis Kozlowski, the deal maker who built Tyco International into a huge conglomerate before he resigned abruptly Monday, was charged Tuesday with cutting illegal deals to avoid more than $1 million in taxes on valuable old paintings.

Manhattan District Attorney Robert Morgenthau said that between last Dec. 11 and Monday, Kozlowski bought six paintings worth $13.2 million using funds borrowed from Tyco, including valuable pieces by Renoir, Monet and other artists.

According to the indictment, Kozlowski avoided paying any of the $1.1 million in New York sales taxes by getting art gallery employees in New York and London to ship empty boxes to the company's offices in Exeter, N.H., by falsifying documents, and by getting Tyco employees in New Hampshire to sign for the shipments.

Morgenthau said Kozlowski has paid back the company for some but not all of the purchases without interest.

Manhattan District Attorney Robert Morgenthau displays a copy of a painting Kozlowski allegedly bought without paying sales tax.

Kozlowski, 55, pleaded innocent Tuesday and was released on $3 million bail. Neither Kozlowski nor his lawyer would comment outside court. His next court appearance was scheduled for June 26.

The paintings Kozlowski bought include ``Fleurs et Fruits'' by Pierre Auguste Renoir and ``Pres Monte Carlo'' by Claude Monet.

Kozlowski is credited with building Tyco into a $36 billion manufacturer during the 1990s, mainly through aggressive acquisitions. The Bermuda-based company makes fire alarms, security systems, bandages and other medical products, and undersea fiber-optic cable.

Critics have said that Tyco used accounting gimmicks when it bought companies to make its profit growth seem faster than it actually was, but the company has stood by its accounting methods.

Morgenthau explains allegations that Kozlowski bought art without paying sales tax. 594k / 60 sec. WAV AIFF sound

The company has struggled lately, hit by last year's recession and worries about corporate accounting that made many investors nervous after the collapse of Enron Corp. last December.

And even as Kozlowski tried to reverse the crisis of confidence facing Tyco -- the drop in its stock since December has cost investors about $86 billion in lost market value -- he faced questions about his compensation and his strategy at the troubled company.

According to the indictment, Kozlowski had a painting removed from his Manhattan apartment and shipped to Tyco's offices in New Hampshire where a company employee signed for it. The painting was then immediately shipped back to his apartment, Morgenthau said Tuesday.

In another instance last December, an art gallery employee authorized release of a $4 million Monet painting to Kozlowski's Manhattan apartment, but prepared an invoice showing it had been shipped to New Hampshire, the indictment charged.

Also, according to the indictment, around the same time another art vendor failed to collect sales tax on four paintings valued at $8.8 million. In that case, Kozlowski allegedly asked an art consultant to ship empty boxes to New Hampshire.

Morgenthau referred to a memorandum he said was from the art gallery consultant to the trucker which read, in part, "Here is a list of the four paintings that are going to New Hampshire (wink, wink)." The memo further instructed the shipper to make cardboard boxes that approximately matched the size of the paintings.

"The city needs the money. Nobody's going to wink. If you don't pay your taxes, you're going to be prosecuted," Morgenthau said at a press conference announcing the charges Tuesday.

The boxes were shipped and signed for by a Tyco employee in New Hampshire at Kozlowski's direction, Morgenthau said. The investigation, which is continuing, began several months ago on a tip from the state Banking Department, the district attorney said.

Kozlowski, who announced his resignation Monday amid reports that he was under investigation for the sales taxes scheme, was charged with falsifying records, tampering with evidence and failure to pay sales taxes. He faces up to four years in prison on each of the 11 felony counts; he also faces a misdemeanor conspiracy charge.

Tyco's (TYC: up $0.72 to $16.77, Research, Estimates) shares edged higher Tuesday afternoon after tumbling as much as 29 percent Monday and hitting a 52-week low of $15.25. The stock has lost some 70 percent of its value since December, when it announced a plan to split into four companies.

Last month it backed off the plan and said it would cut 7,100 jobs instead. Kozlowski called the plan a "mistake," considering the sluggish economy, spending cutbacks, and jitters on Wall Street over corporate accounting.

The company also said it planned to take its CIT financial services subsidiary public in an initial public offering, a move it reaffirmed Monday.

-- Associated Press contributed to this story