The Income Tax Department’s confidential appraisal report of arms dealer Suresh Nanda — which was being allegedly “manipulated” by Deputy Director Ashutosh Verma for a hefty bribe — is a document which has even sleuths of the Central Bureau of Investigation running for cover. The “report” is actually a tome of 597 pages and the CBI now needs to corroborate each entry in it with original seizures made from Nanda and his associates during IT raids in February 2007.The quantum of seizures was staggering: 105 computers with over 300 GB of data; documents that now lie sealed in 12 cupboards in the IT Department’s Investigation Wing in Jhandewalan Extension and Rs 8-crore worth of valuables and cash. But the CBI will also have a lot of explaining to do: how come so much of “evidence” escape the agency’s eye when it raided Suresh Nanda in October 2006, a full six months before the IT raid?The tax probe began with a “source” informing IT officials that two hawala dealers, Vikram Puri and Harivansh Chowla were allegedly associated with the arms dealer. These two were put under surveillance. On February 21, 2007, the Delhi Police, following a complaint from the Prime Minister’s Office, raided M V Rao, a former director of Bharat Heavy Electricals Limited.As reported by The Indian Express (May 13, 2007) Rao, who was posing as an “advisor” of the PMO, turned out to be an employee of Suresh Nanda. From him, the Delhi Police recovered 1,307 pages of what they call highly classified defence documents, apparently meant for Nanda. It was at this stage that IT sleuths mounted their search operations on the arms dealer, his business associates and family members. Ashutosh Verma, the department’s bright spark, in demand for every high-profile raid, was a natural choice to handle the case which proved to be one of its most sensitive and expansive probes. And now, its gravest embarrassment. Sources say for months, the IT’s investigation wing painstakingly cloned hard-disks of the 105 computers recovered during the raids. Nanda’s Chartered Accountant Vipin Babu Bhai Shah (who brokered the “deal” between Nanda and Verma in Mumbai and is also behind bars) was also raided in Mumbai. From his computers, for instance, IT sleuths reportedly retrieved details of Swiss bank accounts and passwords.Another key Nanda aide, Russian-speaking Mohan Sambhaji Jacthap, too, found himself facing the heat of an IT raid since he handled translation of defence documents. The IT’s haul of documents (separate from those recovered from M V Rao) included results of trials of arms and equipment, confidential correspondence of the MoD’s Production wing and copies of tender and pre-tender documents.It took Verma and his team a year to catalogue the recoveries and list them, chapter-wise, in the appraisal report. It thus contains separate chapters on recoveries made from Suresh Nanda, Vikrant Puri, Harivansh Chowla, Vipin Babu Bhai Shah and Mohan Sambhaji Jacthap. There are sections on cash flows into Nanda’s flagship companies — Crown Corporation and Russian Technology Center, mostly from Mauritius from a company named United Business Services (UBS), the ownership of which is now part of the investigation. The IT’s report has a concluding section which states that in the past three years or so, a total of Rs 450 crore was deposited into Nanda’s bank accounts via the (FDI) Foreign Direct Investment and ECB (External Commercial Borrowing) routes which was then routed into “legitimate” businesses like purchase of hotels (including Claridges in Delhi) and land for two Special Economic Zones in Maharashtra. The appraisal report notes that if Nanda was not able to prove the source of these funds, he would be liable for penal action. The appraisal report was finalized and dispatched by Verma to the assessment wing of the Department (for dispatch of show-cause notices and later, calculation of penalties) on February 29 this year. On March 5, a copy of the appraisal report was submitted to the Director General, Investigations. Three days later, the CBI laid its trap.
