Lok Sabha Election 2019

‘Contractors unable to show how money withdrawn from banks was spent’

Money that was found in a locker during searches.

Money that was found in a locker during searches.  

I-T searches on 13 contractors and five PWD engineers led to seizure of close to ₹10 crore

Public works contractors in Hassan and Mandya Lok Sabha constituencies, whose residences and business premises were searched by the investigation wing of the Income Tax Department, have not been able to show the utilisation of money they had withdrawn from banks, sources have said.

The searches on March 28 and 29, on 13 contractors and five engineers of the Public Works Department (PWD) at 21 locations, led to seizure of close to ₹10 crore, including ₹1.69-crore worth gold jewellery. The searches were done on premises including residences belonging to two nephews of Minor Irrigation Minister C.S. Puttaraju — one a zilla panchayat member in Mandya and another a PWD executive engineer in Hassan.

The searches on contractors, believed to be close to Chief Minister H.D. Kumaraswamy’s brother and Public Works Minister H.D. Revanna, had generated political heat, with the governing combine Janata Dal (Secular) and Congress accusing the Union government of misusing the Central agency. Mr. Kumaraswamy, chairman of the coalition’s coordination committee Siddaramaiah and several Cabinet Ministers had staged a protest outside the I-T Department office here following the searches.

In an unprecedented move, the I-T Department, in the midst of the operation, had issued a note to clarify that no Minister/MLA/MP were being searched.

Sources said evidences gathered during searches had shown that funds were allegedly released to contractors for various government projects in connivance with engineers of the State government departments without ascertaining whether or not the works had been executed on ground.

“These contractors were found to have withdrawn money from bank accounts immediately. They, however, have failed to explain or are unable to show evidence to prove how the money withdrawn from banks has been used,” sources said.

Modus operandi

According to sources, the modus operandi involved fixing award of tenders in favour of select contractors, submission of forged bills, release of payment immediately, and withdrawal of cash by contractors who then allegedly passed on the money to politicians to be used for elections. “The cash was transported in convoys with sufficient police cover and protection before being distributed to lower-level party functionaries,” a source claimed.

Income Tax officials maintained that while the searches on contractors had been planned for at least two months since a similar modus operandi had been employed during the Assembly elections in May 2018, searches on rice mill owners and others in the hotly contested Mandya and Hassan Lok Sabha constituencies were part of election expenditure monitoring.

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Printable version | May 27, 2020 6:26:02 PM | https://www.thehindu.com/elections/lok-sabha-2019/contractors-unable-to-show-how-money-withdrawn-from-banks-was-spent/article26751024.ece

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