In a second major intervention with the finance ministry this month, CBI director Ranjit Sinha has written to the secretaries of revenue and banking to caution that big corporate houses were using front firms abroad to illegally reroute huge sums of money.
The CBI has sent copies of the communication to the special investigation team on black money.
Sinha had on August 11 written to finance minister Arun Jaitley on “unfair practices” in the selection of CMDs of public sector banks, including Syndicate Bank, where an alleged bribe-for-loan scandal is under CBI investigation.
FE reported details of Sinha’s letter to Jaitley in its edition of August 13. The ministry has now taken up the matter with the Reserve Bank of India. A committee headed by then RBI governor D Subbarao had approved the recommendation of the panel that chose the now tainted SK Jain for the top job at Syndicate Bank.
In separate letters written to banking secretary GS Sandhu and revenue secretary Shaktikant Das last week, the CBI chief has said that many corporate houses were indulging in “third-party transfers” in violation of RBI guidelines. Sinha has flagged to Sandhu that banks too have been party to these illegal “third-party transfers”, wherein billing is routed through an intermediary in a third location, which is frequently a tax haven.
In the letter to Das, Sinha has asked that cases under the revenue department involving third-party transfers be referred to the CBI.
Sinha’s letters follow a preliminary enquiry registered by the CBI against the Adani Group, which has been accused of over-invoicing to the tune of an estimated R600 crore. The Directorate of Revenue Intelligence (DRI) had earlier issued show-cause notices to three Adani firms for alleged over-valuation.
While the CBI director’s note does not name any corporate house, Sinha is believed to have informed the two secretaries about a recent case — which he is learnt to have described as “the tip of the iceberg” — wherein hundreds of crores of rupees were found to have been similarly rerouted.
Significantly, the CBI chief has requested the revenue secretary to submit to the agency all data available with agencies such as DRI and customs, wherein corporate houses have been detected having routed money using tax havens or front companies.