Seizures from premises of Christy Friedgram Industry included documents related to suspicious payments and classified documents like proposals for posting of IAS officers.

The Income Tax Department has unearthed documents that expose an alleged nexus between a major supplier of food items for Tamil Nadu’s flagship noon meal scheme and politicians, bureaucrats and their associates.

Analysis of electronic storage devices and documents seized from the premises of Tiruchengode-based Christy Friedgram Industry, its employees and others in July has revealed payment of kickbacks to the tune of ₹2,400 crore to top politicians, senior bureaucrats and their family members in recent years.

Highly placed sources told The Hindu on Thursday that the investigating wing of the Income Tax Department had started the process of issuing summons to the suspected beneficiaries of the scam. Christy Friedgram Industry is a supplier of items like weaning food, pulses and palm oil for the noon meal programme and other welfare schemes of the Social Welfare Department.

Seized papers expose money trail

The seizures made by the Income Tax department included some documents related to suspicious payments and classified documents like proposals for posting of IAS officers, sources in the investigating agency said.

“The documents that we have seized include the book of accounts for many years that show payments made to politicians, bureaucrats and others, mostly in code, over a period of time. In a few cases, the names of the family members of bureaucrats who held key posts figured in the list of beneficiaries. Payments to the tune of a few crores of rupees were made to some beneficiaries through online bank transfers. The rough estimate of the kickbacks works out to ₹2,400 crore,” a top investigator, who preferred not to be named, said.

Suspects summoned

After an offence was prima facie established, the IT Department began issuing summons to suspects.

The reason why the firm made payments to the politicians and bureaucrats is under investigation. However, preliminary enquiries revealed that the bureaucrats concerned were either in charge of placing orders or sanctioning bills.

The investigating wing will soon write to the Tamil Nadu government and other Central agencies, sharing details of the scam, for appropriate action at their end, the official added.

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Investigators claimed that the company allegedly suppressed revenues while filing tax returns, with the intention of evading tax. It also furnished contradictory documents while seeking loans from a nationalised bank in Namakkal, sources said.

“Searches conducted at the residence of an IAS officer whose involvement in the scam was suspected had also yielded incriminating documents. Some of the files seized during the raids were classified documents of the Tamil Nadu government which could not have leaked without the connivance of senior bureaucrats,” the official said and added that the contractor had been blacklisted in Karnataka, and a case initiated against the firm by the Lok Ayukta was pending before the Supreme Court.

Bank accounts frozen

Dozens of shell companies suspected to be associated with the management of Christy Friedgram Industry were either directly or indirectly in the dock and their bank accounts frozen. Investigators said that the firm had moved the Madras High Court seeking a stay on the Income Tax Department’s action against it and also sought to plead ignorance about the documents seized.

The noon meal scam has surfaced close on the heels of the sensational gutkha scam in Tamil Nadu where the Health Minister, a few IPS officers and senior officials were allegedly paid bribes to the tune of ₹39.91 crore by the manufacturer of the MDM brand of gutkha.

The scam, exposed by The Hindu in June 2017, is being investigated by the Central Bureau of Investigation and the Enforcement Directorate. The CBI has so far arrested six accused persons, including three officials, and readied a chargesheet against them on the conclusion of the first round of investigation.