A joint team of the Enforcement Directorate (ED) and Income Tax (IT) department on Tuesday searched the premises of companies allegedly connected to Karti Chidambaram, son of former finance minister P Chidambaram, in Chennai.
According to official sources, the searches were conducted in connection with a case of alleged money laundering in the Aircel-Maxis deal, apart from alleged tax evasion and forex violations related to investments made in an eye-care chain.
Following the raids, Chidambaram issued a statement describing the action as a “malicious onslaught” by the government and added that no member of his family had “any equity or economic interest in any of the firms that are being targeted”. Official sources said the premises of Advantage Strategic Consulting Pvt Ltd and Vasan Eye Care were searched by IT and ED sleuths.
The ED is investigating a payment of Rs 26 lakh allegedly made by Advantage to Aircel Televenture in 2006, prior to the Aircel-Maxis deal, and inflow of about Rs 30 crore to the firm from Singapore, sources said. “Most of these transactions have been explained by company owners as consultancy fees. But there is no evidence of the consultancy,” said an ED official.
Advantage allegedly holds 1.5 lakh shares of Vasan Eye Care chain, said ED sources. Reacting to the development, Chidambaram said, “I am travelling and I have been informed about searches conducted on certain firms in Chennai allegedly linked to my son. If the government wishes to target me, they should do so directly, not harass friends of my son who carry on their own businesses and have nothing to do with politics.”
He added, “We have made it clear, repeatedly, that no member of my family has any equity or economic interest in any of the firms that are being targeted. They are companies that are professionally managed and are capable of answering any questions that may be put to them by the authorities. I condemn the attempt to link them to my son and harass them on that ground.”
ED had earlier summoned two directors of Advantage for questioning in connection with its probe into the 2006 Aircel-Maxis deal.
As part of its probe into the Aircel-Maxis deal, the ED has already issued an order for provisional attachment of assets worth Rs 742.58 crore held by former telecom minister Dayanidhi Maran, and his brother Kalanithi Maran and wife Kaveri Kalanithi.
In his statement, Chidambaram accused an unnamed office of “targeting” his son. “The agenda of the government is being implemented by an officer of the Enforcement Directorate who has a pending dispute with the Department of Revenue, Ministry of Finance. Orders in his case were apparently passed during the term of my predecessor. He met me and wanted me to intervene in his favour. I declined and I told him that I cannot reverse orders that were issued during the term of my predecessor. The change of government has given him an opportunity to misuse his powers to harass my son and his friends,” he said. “My family and I are quite prepared to face the malicious onslaught launched by the government,” he said.
The CBDT dismissed Chidambaram’s charges of vendetta, saying the action was based on “credible information of tax evasion” and “financial irregularities”. The CBDT stated that while certain “incriminating evidence indicative of tax evasion and financial irregularities” have been recovered during the ongoing investigation, “no political person or its family member are today shareholders or directors of the companies searched or surveyed by the Income Tax department”.
It said the searches were conducted as per the provisions of the Income Tax Act.