Sushil Manav

Tribune News Service

Sirsa, January 15

A Special Investigation Team (SIT) constituted by the Haryana Lokayukta has unearthed Rs10,618-crore tax evasion scam in the Excise and Taxation Department. It has recommended a CBI inquiry into the affairs of the department. For about two years, big companies, traders and developers in connivance with department officials filed bogus VAT returns or evaded tax.

Some of the companies that the SIT report, submitted to the Lokayukta today, mentions are Robert Vadra’s Skylight Hospitality, DLF, BPTP, Unitech, LT Foods and Sunstar. The report has named a senior bureaucrat saying the officer tried to derail the probe.

The scam was unearthed

in nine districts — Kaithal, Sirsa, Hisar, Fatehabad, Faridabad, Gurgaon, Karnal, Sonepat and Panipat. The SIT has taken the lid off tax evasion to the tune of about Rs18 crore in Kaithal; Rs300 crore in Sirsa, Hisar and Fatehabad; Rs300 crore in Sonepat and Karnal; and nearly Rs10,000 crore in Faridabad, Gurgaon and Panipat.

The Lokayukta had constituted the SIT under Inspector General of Police (IGP) Shrikant Jadhav after receiving a complaint from Satbir Singh of Kaithal. After receiving similar complaints from other parts of the state, the scope of the SIT was widened and it carried out a fact-finding exercise in other parts of the state.

The report has recommended registration of cases against traders, builders and department officers involved in the scam for causing a loss to the treasury.

“The SIT has found out that officers of the Excise and Taxation Department in connivance with traders, builders and developers have caused a huge loss to the state. The system of tax evasion and refund by corrupt means is a well established and unofficially approved system which is mutually beneficial to both sides,” the report said.

It further said a powerful lobby, including senior bureaucrats, officers of the department, rice industry, builders, developers and transporters, derailed the investigation and used all possible means such as non-submission of records, delayed or incomplete responses, and questioning the authority of the Lokayukta to summon records from private persons and the jurisdiction of the SIT.

There were “rumblings” “resentment” and “non-cooperation” towards the investigation, particularly on the part of a senior bureaucrat, who, the report said, requested the Lokayukta in writing to restrict the scope of the investigation to Kaithal district alone.

Citing a Supreme Court judgment in a case titled “Indian Tax Practitioners vs RK Jain”, the report has alleged that the bureaucrat tried to sabotage the investigation in the name of jurisdiction.

The judgment says that a person who raises concerns on wrongdoings in an organisation cannot be silenced by invoking Article 129 and 215 of the Constitution.

The SIT has requested the Lokayukta to take action against four Deputy Excise and Taxation Commissioners — Ombir Singh (Faridabad East), Sneh Lata (Faridabad West), Kuldeep Malik (Gurgaon East) and Dilbag Singh (Gurgaon West) — for not cooperating with the SIT that has the power of a civil court for the purpose of summoning persons and records.

“The SIT feels that since tax evasion scandal involves big names and cannot be possible without the support of the department at all levels, its thorough probe demands inquiries in other states such as Delhi, Rajasthan and Punjab. It will be appropriate if the matter is investigated by an agency such as the CBI,” the report added.

Scam in black and white

For about two years, big companies, traders and developers in connivance with officials of the Excise and Taxation Department filed bogus VAT returns or evaded tax

The SIT has found out that officers of the Excise and Taxation Dept in connivance with traders, builders and developers have caused a huge loss to the state. Tax evasion and refund by corrupt means is a well established system which is mutually beneficial to both sides —Report of the special investigation team