HEADLINES:
February 19 2018
GST Intelligence collects ₹9-crore excise for gutkha
31 October 2017

DVAC, I-T department cross swords over access to original storage devices

 

In an interesting twist to the sensational gutkha scam, the Goods and Services Tax (GST) Intelligence unit has collected about ₹9 crore excise duty from the manufacturer of the banned gutkha/pan masala products. After registering a case of duty evasion against the manufacturer of MDM brand gutkha in Tamil Nadu, the GST Intelligence unit launched an investigation into specific aspects of the scam along with other Central agencies. A State Minister and two top police officers (one of them has retired) were allegedly paid huge sums of money as bribe to allow the manufacture and sale of gutkha in Chennai.

Parrying questions on the provisions under which the duty on the sale of gutkha/pan masala was collected, a top officer in the Directorate General of Vigilance, Customs and Central Excise told The Hindu that the “the manufacturer had voluntarily paid ₹9 crore to the GST Intelligence as excise duty.”

However, the final quantum of duty would be decided based on the outcome of the investigation. As regards allegations of corruption involving officials of the Central Excise Department, the Directorate had shortlisted some officials and sought their explanation on the allegations. “We have even transferred out a few officials suspected to have been involved in the scam. If sufficient evidence is available to prove an offence under the Prevention of Corruption Act, we will refer the case to the Central Bureau of Investigation (CBI). In case the evidence is not strong enough to be dealt with under the Prevention of Corruption Act, we will initiate appropriate disciplinary action against the erring officials...it is a fact that pan masala was manufactured and sold in Tamil Nadu,” the officer said speaking on conditions of anonymity.

The gutkha scam hit the headlines in June this year after The Hindu exposed the content of a classified document sent by the Income Tax department to the Tamil Nadu Chief Secretary. The document contained details of bribes paid to a Minister and at least three IPS officers and other Central/State Government officials to facilitate the manufacture and sale of gutkha in Chennai city. After the State government claimed that there was no such letter from the Income Tax department, the Madurai Bench of the Madras High Court ordered appointment of a Vigilance Commissioner to monitor a probe by the DVAC into the missing documents and also the allegations of corruption.

Storage devices

In what appears to be a logjam over sharing of crucial evidence of corruption in the gutkha scam, the Directorate of Vigilance and Anti-Corruption is apparently not convinced with the copies of evidence provided by the Income Tax department and is insisting on accessing the original storage devices.

While DVAC officials claimed that they need to confirm that the storage devices were not tampered with before proceeding further in the case, I-T officials maintained that they had already sent certified copies of the content and sharing the original seizures could not be done unless there was a specific court order.

“Since digital evidence is vulnerable to tampering, we have to make sure that there is no scope for any suspicion on the merits of evidence. If they (the Income Tax department) are not willing to share the storage devices, we may have to approach the court for necessary orders,” a DVAC officer said.

The DVAC probing the gutkha scam made news when it registered a case against middle-level officials in the police and other departments in the scam. Investigators said that their focus was now on certain points given by B.R. Balakrishnan, the then Principal Director of Income Tax (Investigation), in his reply to a questionnaire sent by the investigating agency. Similar questionnaires were also sent to the former Chief Secretary P.S. Rama Mohana Rao and the former Director-General of Police Ashok Kumar, DVAC sources added.

 

 

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