As India continues its pursuit of black money stashed abroad, the alleged rot within the government has put the spotlight on some of the top tax bosses who are allegedly involved in helping some business houses generate unaccounted wealth.
The Revenue Department, Ministry of Finance, has flagged that a few senior revenue officials have colluded with big business houses to help them evade tax, government sources told MAIL TODAY. The department, sources said, has also sought an investigation.
It wasn't a routine communication. Then secretary (revenue) in the Ministry of Finance had written to the CBI last year, alerting the agency of a high-level nexus.
Sources said the CBI is inquiring into the allegations. The probe agency, however, did not respond to an e-mail query sent by MAIL TODAY, seeking the current status of the investigation.
"Inputs indicated that certain officers were facilitating tax evasion for certain individuals and industry. Some big taxpayers are involved in the racket that needs to be investigated," said a government official.
Names of five senior tax officers were mentioned in the "top secret" communication sent to the CBI. Sources said a few months later, a reminder was also sent to the agency seeking action.
Sources said it is suspected that a syndicate involving senior tax officials and corporate houses are involved in the multicrore tax evasion net. Through its internal surveillance mechanism and inputs from various sources, Department of Revenue had earlier listed nearly 20 senior tax officials suspected to be part of the alleged bribery syndicate. Later names of five were sent to CBI while the others remained under watch.
At a time when the Narendra Modi government is taking efforts to crack down on black money syndicates within and outside the country, allegations of top officials being part of the network and helping corporate houses have come as a challenge for it.
Union Finance Minister Arun Jaitley, while speaking to young Indian Revenue Service (IRS) officers in December 2015, said tax collection should be done without giving any discounts or concession.
"A taxman's job is mixed. He has to be firm and fair," the minister had said. It's not the first time when a bribery cartel involving senior tax officials has come to light. In January 2015, the CBI busted a syndicate involving Income Tax officials, chartered accountants and businessmen.
The agency arrested four people, including a senior IT officer. In yet another similar case in April 2015, an Income Tax officer and some others were arrested.
The Modi government has maintained that black money menace is an issue which the Centre is seriously trying to tackle. Not only the surveillance mechanism to deal with domestic black money has been strengthened, but the Centre is also negotiating with foreign authorities to ensure the access to more information about those holding bank accounts abroad. "We are in talks with authorities abroad and seeking more information to identify those holding such accounts," said a government official.
Soon after coming to power in May 2014, the NDA government constituted a Special Investigation Team (SIT) for probing black money following a Supreme Court directive. Heads of 11 premier central probe and enforcement agencies are part of the team headed by former Supreme Court judge Justice (retd) M B Shah. The SIT has been charged with the responsibility and duties of investigation, initiation of proceedings and prosecution in cases of Hasan Ali and other matters involving unaccounted money. The panel has jurisdiction in cases where investigations have commenced, are pending, are waiting to be initiated or have been completed.
While probing black money stashed in undisclosed HSBC bank accounts abroad, the SIT has pegged the total amount at Rs 6,400 crore. Around Rs 237 crore was recovered while a tax demand of Rs 4,500 crore was raised. Of the 628 bank accounts under scanner, action could be initiated against 403. An additional 575 accounts in France were also under scanner of the SIT.