CBI raids excise officials and steel majors….Soumittra S Bose
NAGPUR: The Anti-Corruption Bureau of the Central Bureau of Investigation (CBI), Nagpur, swooped down upon senior Central Excise officials and four major steel players for alleged evasion of service tax to the tune of more than Rs 1 crore.
On Tuesday, searches were conducted, following offence registered against the accused on March 31, at around 15 places including two each in Mumbai, Indore and Chandrapur, seven at Nagpur and some other places.
Two officials of the Indian Revenue Service, including a former employee, have been booked along with three Central Excise officials of the rank of superintendents for colluding with four steel companies, allegedly helping them to evade payment of service tax and related penalties. It had been incurred by the companies for dealing with foreign based agencies.
The CBI has also slapped charges of forgery, criminal misconduct, misuse of official position and relevant sections of Prevention of Corruption Acts against Llyods Steel Industries limited of Llyods Group, Facor Steel Limited, Bajaj Steel Industries Limited and Sunflag Iron and Steel Company.
The officials had also disposed of the service tax arrears cases instead of referring them to senior officers. As per norms, cases amounting to more than Rs 5 lakhs had to be referred to commissioners. Not informing their seniors amounted to suppression of facts by the senior excise officials.
Offences have been registered against former assistant commissioner NP Meshram, now elevated as deputy commissioner in Mumbai, along with others including assistant commissioner of Central Excise P George Varghese who had opted for voluntary retirement in 2007. The residence of Meshram in Nagpur and Mumbai too was searched. Varghese’s residence at New Panvel too was scanned by the CBI sleuths.
Among the three superintendents of Central Excises who were booked are DS Patil, JC Solanki and BK Adley. Patil is posted in Nagpur while Solanki is serving in Indore. Adley, who earlier worked in Nagpur, is now posted at Chandrapur. Searches were conducted at the offices and residences of these officials too.
Sources said that the private companies had attempted to evade service tax on business auxiliary services to be paid to foreign agents. Prior to 2003, there was no requirement to pay taxes for the services rendered by foreign agents. The rule came into effect in July 2004.
During assessment year 2006-07, the private companies were supposed to pay the service tax arrears after calculating it from 2004. The excise officials apparently helped the companies by applying a section of the (service tax) Finance Act which was not applicable for calculating the arrears.
Pending amount:
Co F&A PA
Llyods SI 68 34
Facor Steel 17 8.5
Bajaj Steel 5 2.80
Sunflag 6.80 3.44