Biggest tax evasion scam unearthed

Excerpts from Power Breakfast on CNBC-TV18 Watch the full show » Nifty BSE | NSE 10/02/12 Are Mutual Funds betting on Nifty?

Rs 35,000 crores is the estimated size of what could be the biggest income tax evasion scam in this country, reports CNBC-TV18.

A six-storeyed building in Pune's Koregaon Park area belongs to Hasan Mohammed Ali - an affluent business man having interest in horse breeding, exports, and of course horse racing. But a casual raid by the Income Tax department has opened up a can of worms on his life style.

The IT Department smelled a rat and raided Ali's offices in Pune, Mumbai, Hyderabad and Kolkata between 5th and 7th of January this year where they came across Ali's computer. The hard disc contained details of transactions totalling to Rs 35,000 crores in 10 Swiss bank accounts.

"We can't confirm or deny anything right now," says DV Dharmik, Chief IT Commissioner, Hyderabad.

The Finance Ministry was informed immeditely and they handed over the case to the Enforcement Directorate. Accordingly, a team of four senior officers was sent to Switzerland between January 15-19. Details of seven out of the 10 accounts were found matching and the Government of India asked for the accounts to be frozen.

Ali has been questioned in this respect on various ocassions but has not been arrested so far due to lack of evidence. The IT department, meanwhile, is being tight lipped about the matter.

What started as a random scrutiny is turning out to be the biggest case in the history of income tax investigations. The Enforcement Directorate is now waiting for details from the Swiss bank to finally nail Hassan Ali. But the real question is - where did this huge amount of Rs 35,000 crore come from and who are the other bigger players.