The Income-Tax Department and the Enforcement Directorate (ED) on Tuesday conducted joint searches on the Chennai premises of two companies owned by the associates of the former Finance Minister, P. Chidambaram’s son Karti Chidambaram.
The ED joined the operation against Advantage Strategic Consulting Private Limited and the Vasan Eye Care Group as part of the probe into the suspected violation of foreign exchange rules, while the I-T Department conducted searches to ascertain possible tax evasion and financial irregularities.
The move drew sharp reaction from Mr. P. Chidambaram, who said no member of his family had any equity or economic interest in any of the firms that were being targeted.
“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… I condemn the attempt to link them [the companies in question] to my son and harass them on that ground,” he said, alleging that the government’s agenda was being implemented by an ED official.
Suspicious transactions
The Income-Tax probe into Vasan Group’s dealings is based on the findings of searches conducted in January against one JD Group, which allegedly had several suspicious transactions with the former. The Income-Tax Department said the probe was being carried out by its Chennai-based investigation wing.
Searches were conducted on the residential and business premises of key functionaries of the group, the official release said.
Premises of Karti’s associates searched
A survey was also carried out on the business premises of another private firm in Chennai, which has shareholding in a group’s company.
“There is no collateral purpose behind such actions and no political person or his family member are today shareholders or directors of the companies searched or surveyed by the Income Tax Department,” said the Department.
The ED is probing to ascertain whether Advantage Strategic had acquired 1.5 lakh shares of Vasan Group at a throwaway price of Rs.100 a unit. Thereafter, the firm had allegedly made over Rs.22 crore by selling 30,000 shares at Rs.7,500 each to Sequoia Capital.
