Is the interim CBI chief risking contempt of court? The CBI or Central Bureau of Investigation, under M Nageswar Rao as acting chief, has allegedly ordered closing investigations against a controversial middleman and chartered accountant Sanjay Bhandari, accused of bribing Income Tax officers.
This is the case that acting director M Nageswar Rao faced scrutiny for trying to close in March. Director Alok Verma was opposed to it and ordered reopening the inquiry. Sources say the inquiry was shut down earlier this month, according to file notings.
Mr Rao became interim chief on October 23 in an overnight shake-up in which Alok Verma and his deputy Rakesh Asthana were sent on compulsory leave. Alok Verma challenged the government’s move three days later in the Supreme Court, which had ordered that Mr Rao can take only administrative, not policy decisions.
The case was an offshoot of a raid that the CBI had carried out in January 2015 on joint commissioner, Income Tax, Sallong Yaden, for bribery.
While investigating that case, agency officials learnt that auditor Sanjay Bhandari was allegedly working with many Income Tax officials to help his clients fudge tax details. The CBI registered a new case and raided locations across the country.
Officials named in the CBI case were Principal Commissioner of Income Tax SK Mittal, Income Additional Commissioner (Bengaluru) TN Prakash, Deputy Commissioners Chennai, RV Haroon Prasad and S Murali Mohan, Commissioner Chennai Vijayalakshmi, Additional Commissioner Mumbai S Pandian, Commissioner Mumbai G Lakshmi Baraprasad, Additional Director General Ghaziabad Vikram Gaur and Additional Director investigation Mumbai, Rajendra Kumar.
The CBI alleges that Sanjay Bhandari and his sons Shreyas and Divyang paid bribes in return for the favour. The officials scored five-star hotel stay, the use of luxury cars and air travel – all paid for by Bhandari and sons. CBI sources had at the time also indicated that they found evidence from Bhandari’s offices linked to these officers and the quid pro quo was that these officials would deliver favourable Income Tax orders.
As joint director of CBI in Chennai, Nageswara Rao was in charge of the case. It was in March that he first moved to close it citing lack of evidence. Sources told NDTV that top police officers P Thanmozhi and Deputy Superintendent of Police R Prabhu, were transferred out of CBI for refusing to file a closure report in the case.
When Alok Verma visited Madurai for the inauguration of a new CBI branch in June, he reportedly wanted the probe reopened. This was also noted in the file on 23 October by additional director Praveen Sinha. Mr Rao has, say sources, decided to do the opposite.
In response to NDTV’s questions, the CBI said the case was closed much earlier on March 14, on director Alok Verma’s order, and Mr Rao actually refused to reopen it to honour the Supreme Court ruling.
“Subsequently the file was moved for re-investigation before the interim director and giving an approval for reinvestigation would have been a policy decision, and this would have been in violation of guidelines issued by the Supreme Court order, so the reopening was turned down,” said an agency official.