Four government officials, banking sector officers and a network of touts; the biggest seizure by the Income Tax department post demonetization has revealed how deep the muck runs.
IT dept said on Friday that cash in excess of Rs 6 Crores, bullion of 7 kg approximately and jewellery about 9 KG were found from the residences and offices of four Karnataka state government officers.
Out of the cash found, Rs 5.7 Crores was in new currency of Rs 2000 notes and Rs 90 Lakhs has been found in the old demonetised currency.
But the loot did not end with that.
The two Karnataka State Government Engineers and two contractors had unaccounted income of Rs 152 crores and a chain of luxury cars.
The IT department in a press release said, “Total admission of unaccounted income in the group stands at Rs 152 Crores.”
According to reports by Suvarna News, Chikkarayappa, the Managing Director of Cauvery Neeravari Nigama Limited and KC Jayachandra, the Chief Project Officer of the State Highway Development Project confessed to the IT investigators that they did own property worth Rs 152 crore, that is unaccounted for.
Officer close to Siddaramaiah?
The drama surrounding the I-T raids has set off a discussion in the Belagavi Assembly session, with Chief Minister Siddaramaiah saying that he was not friends with any of the accused officials.
“The two of them are just government employees and nothing more. If it is found that they obtained the money illegally, then they will not go unpunished. The government does not tolerate corruption and nobody should spread rumours about these I-T raids,” the CM told mediapersons.
The opposition, however, came down heavily on the Congress, with many of them demanding that that the bank officials the duo had dealings with must be investigated.
“How did they (Chikkarayappa and KC Jayachandra) obtain such huge sums of new denomination notes when the one cannot withdraw upto Rs 50,000. People have been waiting in queues for days and some of them have not been able to get money. It is quite obvious that bank officials and also high-profile ministers are involved in this racket. The I-T Department must uncover this,” said BJP leader and former Deputy Chief Minister, Eshwarappa.
Home Minister, G Parameshwara said that the duo had been suspended pending investigation.
“I have discussed the issue with the Chief Minister and the Chief Secretary after which they have been suspended,” he added.
Complacent banks
The seizure of new currency notes has made it clear that few bank officials were involved in the racket.
Various Kannada news reports say that four banks in Bengaluru, Chennai and Erode have been issued notices by the IT Department.
The bank managers, who dealt with the duo may be questioned, reported Suvarna News. Also, theses banks may be asked to furnish details of their monetary transactions since demonetisation, media reports suggested.
According to IT department sources, the transactions were done at a high commission that was paid to bank officials.
The source told TNM that the RBI was tracking the notes and the banks would be zeroed in soon with evidence.
A report by the Times of India says that apart from the money and gold, property ownership papers and several ID cards were recovered, which the taxman suspects may have been used to exchange money.
Kickbacks received?
According to Suvarna News, the State Highway Development Project, for which KC Jayachandra is the Chief Project Officer, had issued Rs 3,500 crore worth of tenders to various companies and had allegedly stashed away kickbacks in the old currency.
Similarly, The Cauvery Neeravari Nigama Limited, whose Managing Director is Chikkarayappa, had allegedly received kickbacks from tenders worth Rs 2,000 crore issued to a Hyderabad-based company, IVRCL, which is believed to be blacklisted, the Suvarna News report said.
The I-T Department’s raids on the two government officials followed a tip-off from some operators who were involved in converting black money into new currency notes.
The duo has been issued separate notices and asked to furnish documents to verify how they accumulated the new currency notes in such a short period.