india

Updated: Nov 27, 2018 01:43 IST

M Nageswara Rao, the acting chief of the Central Bureau of Investigation (CBI), has ordered the closure of a case registered by the agency against nine Income Tax (I-T) officials and a Chennai-based chartered accountant in a move that could potentially come under the scrutiny of the Supreme Court, which has asked him not to take any significant decisions.

Rao has denied the charge.

In June 2016, CBI’s Chennai branch registered a case against nine I-T officials and three others, and conducted searches at 17 locations in several cities. Those named as accused included I-T officials of the rank of principal commissioner, commissioner and additional commissioner. They were accused of seeking favours – stays in five star hotels, conveyance in luxury cars and air tickets – from a Chennai-based chartered accountant in lieu of helping the latter’s clients.

The 2016 case was an offshoot of another case registered a year earlier against the same chartered accountant and a joint commissioner-level I-T official posted in Chennai.

“During the course of investigation in the first case, the agency found evidence that suggested there were other IT officials too who took favours from the same chartered accountant and his sons. Therefore the second case was registered against nine IT officials in 2016,” said a CBI official familiar with the case who asked not to be identified.

In March, CBI’s Chennai branch, then headed by Rao, decided to close the case in “absence of evidence” and the CBI director Alok Verma as “competent authority” accorded approval to this, according to documents seen by Hindustan Times.

However, Verma subsequently seems to have changed his mind.

The CBI official cited above said Alok Verma visited Madurai on June 7 for the inauguration of a new CBI branch there. During the visit, he “reviewed cases under the Chennai branch and orally issued instructions to reopen the case and conduct a fresh investigation.”

This is borne out by the case file sent by Praveen Sinha, the additional director currently heading the Chennai branch of CBI, to the acting director on November 8. Sinha’s file notings clearly mention the oral instructions of Verma in June, and seeks permission to go ahead. Hindustan Times has seen the file notings of Sinha.

It isn’t known why a case file ordered to be reopened by the director in June did not move till November.

In response to Sinha’s request, Rao cited his earlier decision taken on March 13 and ordered closure of the case.

In response to a detailed email from HT seeking response as to whether the decision taken by the acting director to bypass the oral instructions of Alok Verma was a violation of the Supreme Court’s directions, the CBI spokesman said: “After the investigation in the case, for want of evidence, it was decided on March 13, 2018, by director Alok Verma to close the case. Now the matter was brought before the interim director for re-investigation into the case. Had the interim director approved reopening of the investigation, it would have amounted to a policy decision which would be in violation of the directions of the honourable Supreme Court.”

In October 23, CBI’s director Verma and deputy Rakesh Asthana were both divested of their responsibilities after a bitter internecine war between them threatened to split the agency down the middle. Verma challenged his removal in the Supreme Court. At the time, the court said that Rao would not take any policy decisions.

When asked to clarify on the oral directions of Alok Verma in June to reopen the case, the spokesperson declined to add anything to his statement.