Chairman of the Central Board of Taxes Pramod Chandra Mody gave a “shocking” directive to bury a “sensitive case” and claimed that he had “secured” his position at the top because of a “successful search” action against an Opposition leader.
This is the key allegation in an unprecedented complaint against the nation’s top tax administrator by Alka Tyagi, who was Chief Commissioner of Income Tax (Unit 2) in Mumbai when she sent her complaint to Union Finance Minister Nirmala Sitharaman on June 21, less than a month after the new government was sworn in.
Tyagi’s nine-page complaint, reviewed by The Indian Express, alleges “tremendous pressure” from Mody. An almost identical complaint has been sent by her to the Prime Minister’s Office, the Central Vigilance Commission and the Cabinet Secretary, sources confirmed.
As reported by The Indian Express earlier this month, a break-in was reported by Tyagi in her office and she had submitted a written complaint about this to her senior, Principal Chief Commissioner S K Gupta.
Tyagi, an IRS officer of the 1984 batch, has alleged that an old vigilance case against her, which Mody had himself later disposed of and in which she was given an all-clear, was recalled by Mody and is being used as a “weapon of blackmail” to stall her posting.
Two months after this complaint, the government extended Mody’s tenure for a year.
And on Thursday, Tyagi herself, due for a posting as Principal Chief Commissioner of Income Tax, was moved out to the National Academy of Direct Taxes in Nagpur as Principal Director General of Income Tax (training).
Tyagi’s complaint alleges a string of irregularities that include how the CBDT chairman “repeatedly” asked Tyagi to drop “proceedings” in a “sensitive case’’ involving “serious allegations.”
In her complaint, Tyagi alleged Mody has “admitted” to her that “a successful search supervised by him in the case of an opposition leader, firmly secured him in his position as chairman (CBDT) and (that).he could take unfettered action against some officers too”.
Tyagi alleged that in the last week of April/early May 2019, Mody informed her that the proceedings initiated against the “sensitive assesses had to be dropped” and this work should be completed before the end of May 2019. The complaint reads: “This direction was shocking but it was conveyed repeatedly, despite the difficulty I expressed to him.”
According to the complaint, Mody gave instructions that “there should be no record maintained of the fact that he was in any manner, involved in this sensitive case (which Mody asked to close) even for consultations and that it should be ensured that nothing in this file should ever show his linkage, in any manner to this case”. Tyagi has also said that the chairman put “tremendous pressure” on her “to close this file at any cost”.
She has detailed how “initial notices” in the case were filed and prior to that, “it was a herculean task to convince him (the Chairman) that once such information was received, the initiation of the action was mandatory, failing which the careers of the dealing officers would be jeopardised, probably resulting in vigilance proceedings being initiated against them. Even after this, Mr P C Mody directed that the draft of the notices would be approved by him. Here again, he failed to accord approval till the very end, despite being aware that he was jeopardising our careers”.
Among the assessment cases being handled by Tyagi’s office are the Deepak Kochhar-ICICI Bank case, notices sent to members of Mukesh Ambani’s family under the Black Money Act, the Jet Airways case, besides several important search cases.
In her letter to the Finance Minister, Tyagi said she had “never dreamt” of revealing such details but did so because of the “manipulative and unscrupulous” nature of the functioning of the CBDT chairman.
Tyagi has also accused Mody of “getting complaints manufactured against officers who do not succumb to his demands.”
Once, Tyagi alleged, Mody called her for a meeting at around 8.45/9 pm in his office in North Block. She has written in her complaint that she ignored the request.
“As a lady officer in the department for 34 years,” she wrote to the Finance Minister by way of explanation, “and having experienced the mala fide intentions of such odd hour one-to-one meetings, which are possible to be held at other times too.”
Tyagi has spent 11 years of her career outside the Income Tax Department – as western zone director of the Narcotics Control Bureau and Chairman and Managing Director of the state-owned Hindustan Diamond Co.
Her complaint details a pending vigilance inquiry pertaining to banking transactions linked to her family. She stated that her husband, V Raman Kumar, is a non-resident businessman and a former IRS official. In 2012, Kumar sold his Nasdaq-listed firm, Mmodal.
The vigilance matter began with a 2016 enquiry by the Enforcement Directorate (ED) into “some large transactions” in banks accounts of her family members wherein she was a signatory.
According to Tyagi’s complaint, after a detailed verification, the ED did not find any forex violations and referred the case to the tax department for further enquiry. Subsequently, the then CBDT member ( investigation) conducted an “exhaustive” enquiry and found that all credits and debits handled by her were “accounted for” and that “the entire taxable income arising from these transactions had been offered for tax” by her family members. The complaint notes that since Tyagi is a government officer, the case was referred to the CBI which found no violation by her.
Subsequently, the CBI referred the case to the cadre controlling authority of CBDT to see if there was any procedural violation by Tyagi in disclosing these transactions. However, that report too did not find any deficiencies and her vigilance file was put up for closure in 2018.