₹281-cr cash collection racket in MP linked to political party: I-T dept

It said that meticulous records of collections and disbursement of cash had also been found in the form of hand-written diaries, computer files and excel sheets which had been found and seized.

The Central Board of Direct Taxes (CBDT) on Monday said that searches by the income tax (I-T) department have detected “widespread and well-organized racket” of collection of unaccounted cash of about ₹281 crore through persons involved in business, politics and public services.

IT raids underway at the residence of Praveen Kakkar, OSD to Madhya Pradesh Chief Minister Kamal Nath, in Bhopal on Sunday.(Mujeeb Faruqui/HT Photo)

The statement referred to searches that started Sunday and continued into Monday, of several key associates and aides of Madhya Pradesh chief minister Kamal Nath.

“A part of the cash was also transferred to the headquarter of a major political party in Delhi including about ₹20 cr [crore] which was moved through hawala recently to the headquarter of the political party from the residence of a senior functionary at Tughlak Road, New Delhi,” CBDT said in a statement without giving names of either the party or the functionary.

Meticulous records of collection and disbursement of cash in the form of hand written diaries, computer files and excel sheets found and seized corroborate the above findings, it added. Unaccounted cash of ₹14.6 crore has been found so far, besides 252 bottles of liquor, few arms and the skin of a tiger, the statement said.

“Instances of violations of Model Code of Conduct are being brought to the notice of ECI [Election Commission of India],” it added. The statement also said: “The searches in Delhi in the group of a close relative of the senior functionary have further led to seizure of incriminating evidence including cash book recording unaccounted transactions of ₹230 cr [crore], siphoning off money through bogus billing of more than Rs. 242 cr [crore] and evidence of more than 80 companies in tax havens”.

The I-T on Sunday initiated search and seizure actions on a group in NCR, Bhopal, Indore and Goa based upon “credible” information of “large scale collection, possession and movement of unaccounted assets”. The operation involved participation of over 300 I-T officials at 52 locations in four states, it said. Those raided include Nath’s former Officer on Special Duty Pravin Kakkar, former advisor Rajendra Miglani, and executives linked to his brother-in-law’s firm Moser Baer and his nephew Ratul Puri’s company, Hindustan Powerprojects Pvt Ltd.

BJP leaders, including national general secretary Prabhat Jha, state vice-presidents Rameshwar Sharma and Vijesh Lunawat, and convener election cell Shantilal Lodha lodged a complaint with chief electoral office, Madhya Pradesh, on Monday evening. Prabhat Jha said, “Police was sent by the chief minister Kamal Nath to save Ashwini Sharma. We have lodged a complaint against MP police for disrespecting CRPF and interfering in their work of I-T department.”

Congress leader and minister in Kamal Nath government Jeetu Patwari said the Centre was working against the spirit of federal structure of the country and indulged in a political vendetta.

Responding to a Election Commission of India note on Sunday saying all “enforcement action” should be “absolutely neutral”, a person familiar with the matter said a senior finance ministry bureaucrat has written to the body saying that such action is always neutral, and exhorting election commission officials to take action if they came across the use of illicit funds in elections and also alert the tax department about this.

Those raided include Nath’s former Officer on Special Duty Pravin Kakkar, former advisor Rajendra Miglani and executives linked to his brother-in-law’s firm Moser Baer and his nephew Ratul Puri’s company, Hindustan Powerprojects Pvt Ltd, IT, and finance ministry officials said on condition of anonymity.

A CBDT official with direct knowledge of the matter said that the searches on Miglani and Kakkar were an “outcome of credible information of movement of cash”.