Gutkha scam: CBI searches Chennai residences of top GST official and Central Excise personnel

New Delhi: The CBI has carried out searches at the Chennai residence of Additional Commissioner, GST, Senthil Valavaen in connection with the Gutkha scam, officials said on Thursday.

Searches were also conducted at the residence of S Sridhar, former additional commissioner, System and Central Excise Intelligence, DGCEI, in Chennai. The premises of Valavaen, an Indian Revenue Service officer, in Chennai were searched in connection with the Gutkha scam, the officials said.

Representational image. Reuters

Representational image. Reuters

The agency had last month arrested promoters of Annamalai Industries, manufacturer of MDM brand of gutkha (a tobacco and 'pan masala' concoction) and some government officers in connection with the case. The company was earlier known as Jayam Industries which was rechristened into Annamalai Industries to continue the sale after Tamil Nadu banned gutkha in 2013, they said.

The promoter directors of Jayam Industries — A V Madhav Rao, Uma Shankar Gupta and Srinivas Rao — continued selling MDM brand gutkha in the state even after the ban by allegedly influencing officials, politicians and regulatory authorities, the agency officials said. The scam came to light on July 8 last year when income tax sleuths raided the godown, offices and residences of the company in Tamil Nadu, which had been facing charges of tax evasion to the tune of Rs 250 crore, they said.

During the raids, the Income Tax department had seized a diary containing names of those who had been allegedly paid by the gutkha manufacturers. The case was sent to the Central Bureau of Investigation by the Madras High Court in April this year on the plea of a DMK leader.

It is alleged by the petitioner in the Madras High Court while demanding a CBI probe that monthly payments worth over Rs 14 lakh were made to Health minister Vijayabaskar while payments in lakhs of rupees were made to officials of the Central Excise, Food Safety and Sales Tax department of the state, senior police officials and politicians, among others.

This was challenged in the Supreme Court by a Tamil Nadu health official but the apex court sided with the Madras High Court order and asked the CBI to register a case. The agency had registered the FIR against unidentified officials of the Tamil Nadu government, Central Excise Department and the Food Safety Department in May.


Updated Date: Oct 05, 2018 09:04 AM

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