Raids on other P Jain add to poll heat in UP

Piyush Jain, a chemical trader with ties to the pan masala business, and Pushpraj Jain, a perfume merchant, are neighbours.

New Delhi/Mumbai: The Income Tax department on Friday raided premises linked to Samajwadi Party (SP) lawmaker Pushpraj ‘Pampi’ Jain and other perfume traders in Uttar Pradesh for alleged tax evasion, sparking a political tussle months before high-stakes state polls.

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The raids came nine days after tax investigators raided the house of Kanpur-based businessman Piyush Jain and recovered nearly ₹197 crore in cash, along with 26kg of gold and other precious items.

Piyush Jain, a chemical trader with ties to the pan masala business, and Pushpraj Jain, a perfume merchant, are neighbours in Kannauj. The similar-sounding names and proximate addresses caused confusion and a political row last week, with Bharatiya Janata Party (BJP) leaders saying the SP leader was raided, and SP chief Akhilesh Yadav saying the agencies wanted to target Pushpraj Jain but erroneously raided the other businessman.

Pushpraj Jain is a member of the legislative council (MLC) in Uttar Pradesh as a Samajwadi Party nominee. He launched the Samajwadi ittr (perfume) on November 9.

On Friday, IT department sleuths swooped in at least 40 premises including Jain’s residence in Kannauj and other locations in Kanpur, Surat, Mumbai and the National Capital Region, including a residence in Delhi’s New Friends Colony.

The IT department didn’t share any further details but people familiar with developments said the raids were launched after investigators obtained details from the Goods and Service Tax (GST) department about possible income tax evasion by perfume business entities and others by allegedly claiming bogus input tax credit.

In Mumbai, a team comprising five to six officers searched eight commercial and six residential places in Malad, Goregaon, Kanjurmarg and Vile Parle, said a tax officer, requesting anonymity. The agency also scrutinised four bank accounts linked to Pushpraj Jain and his family members. Another team visited a residential complex situated in Malad (West), also allegedly related to Jains.

The raids sparked a political row.

Yadav termed the raids the result of the BJP’s fear of losing the upcoming assembly election, which is scheduled to be held early next year.

“The raids were pre-determined. Information was coming here for the past few days that raids have started on SP leaders. Here, for the last two weeks, there have been raids on people associated with Samajwadi and whenever the BJP leaders from Delhi come to Uttar Pradesh they bring these agencies along. During this time, they are instructed to conduct raids,” Yadav said.

“Ever since the BJP feared defeat, leaders started coming from Delhi and their allies Enforcement Directorate (ED), Central Bureau of Investigation (CBI) and Income Tax (IT) started coming. We tied up with small political parties and they tied up with investigating agency CBI, ED and IT,” he alleged.

Union finance minister Nirmala Sitharaman rejected his allegations. “The person caught red-handed must be his partner or friend that’s why the former chief minister is shaken,” she said.

On December 22, the Directorate General of GST Intelligence (DGGI), an investigation agency under the Central Board of Indirect Taxes and Customs (CBIC), carried out large-scale raids in Kanpur and Kannauj against Shikhar brand pan masala, a transporter and others and later arrested Piyush Jain, from whose residence they seized around ₹197 crore in cash apart from 26kg gold and around 600kg of sandalwood.

The two Jains live a few paces from each other in the Chipatta neighbourhood of Kannauj. The proximate names and addresses appeared to have caused a confusion last week with many BJP leaders alleging that the SP leader had been raided. At a rally in Kanpur, even Prime Minister Narendra Modi took a veiled dig at the SP over the cash seizure, saying the ‘ittr’ (perfume) of corruption sprinkled all over Uttar Pradesh before 2017 – the year Yadav was voted out of power – was for everyone to see.

Hours later, Yadav hit back, saying that the agencies wanted to target Pushpraj Jain but raided the other businessman by mistake. He also alleged that the money found at Piyush Jain’s house belonged to the BJP. On Friday, he said his earlier assertion was vindicated. “Today’s raids are being done out of frustration to overcome the earlier mistake wherein the BJP supporter was taken for a SP man,” he added.

But Sitharaman countered the Opposition leader, saying the cash recovered from Piyush Jain’s house was not BJP money, and that the raid was at the correct address and not the outcome of mistaken identity. She said the raids, which were based on actionable intelligence, seemed to have “shaken” former chief minister.

“If he is so sure to say that it is BJP’s money, how does he know? Only if you are running a business in partnership with someone would you know whose money is parked. He (Jain) must be their partner that’s why they are saying with so much surety that it is BJP’s money,” she said.

“I am saying it is not BJP’s money,” she added.

She also dismissed allegations that the wrong person had been raided.

“Have they come back empty-handed after the search? It is also being said they had to go to a different address but they landed at the correct address. It has been proved after the raid that the information on the basis of which the raid was conducted was correct,” she said.