The Income Tax authorities have slapped a demand notice on P.V. Sreenijin and his wife K.B. Sony, son-in-law and daughter of the former Chief Justice of India K.G. Balakrishnan, asking them to cough up a tax due of Rs. 2.2 crore for the period between 2007-08 and 2009-10.
The demand was raised last month after an enquiry into the alleged undisclosed income of the couple was conducted by the department’s investigation wing based on a whistle-blower complaint in December, 2010.
It necessitates Mr. Sreenijin and his wife, both lawyers, to either fork out the outstanding tax amount to the government or go in appeal to the Commissioner of Income Tax (CIT) and further, if needed, to the Income Tax Appellate Tribunal (ITAT).
Mr. Sreenijin chose not to respond to calls and messages from The Hindu on the issue.
The I-T authorities earlier unearthed massive hidden wealth possessed by M.J. Benny, another son-in-law of the ex-CJI who was asked to remit Rs. 1.2 crore which he complied with.
Besides demanding tax on wealth accrued, it is not within the powers of the IT department to find out how assets were acquired, the officials maintained.
Probing the means of acquisition, they said, is the job of the Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED).
I-T officials who investigated Mr. Sreenijin’s assets remarked that his family income had grown stupendously since 2006, when his declared assets were valued at just Rs. 4.63 lakh, as per his election affidavit.
Then a Congress leader, Mr. Sreenijin had unsuccessfully contested elections from Njarakkal assembly constituency.
The investigation report lists out the ostensibly undervalued acquisition of movable and immovable assets by Mr. Sreenijin and his wife since 2006.
It alleges that they purchased 36 cents of land at Varapuzha for Rs 7 lakh; 30 cents of land at Keerthinagar in Kaloor for Rs. 30 lakh in June, 2009 (when the prevailing market rate was Rs 8 lakh a cent); residential property measuring 3.5 cents in his mother’s name adjacent to the property in Kaloor; a flat at Edapally; and 2.75 acres of land at Annamanada in Thrissur at Rs 1.14 crore in November 2008 besides buying office space in Ernakulam town.
The couple is also stated to have operated at least five bank accounts, with cash deposits between Rs 2 lakh and Rs 20 lakh in each.
While Mr. Sreenijin had a deposit of Rs. 9 lakh in a leading private bank in Edapally, his wife had deposited Rs. 10 lakh in the same bank, the report reveals. The I-T investigation report hints at the possibility of the duo enjoying substantial holdings as ‘sleeping partners’ in many business enterprises, including an Aluva-based real estate firm.
The findings also show that various private limited companies and promoters of companies, including diamond firms in Mumbai, were paying the couple hefty sums as ‘consultancy charge’ during Mr. Balakrishnan’s term in office as CJI.
The report cites instances of Rosy Blue (India) Private Limited — a firm dealing in diamonds — paying the couple Rs. 1 lakh each almost every month between July 2006 and March 2010 and Amity Housing and Resorts (India) Private Limited in Aluva allegedly disbursing a monthly retainer of Rs. 1.5 lakh for consultancy services.
Of the Rs. 2.2 crore demanded by the tax authorities, Mr. Sreenijin’s share is about Rs. 1.4 crore. The couple has a month’s time to pay up or resort to appeal.