I-T raids on Delhi minister Kailash Gahlot: Ex-AAP member Neil Terrance Haslam backs charges of financial misappropriation

While the Aam Aadmi Party has termed the recent income tax raids on premises linked to Delhi minister Kailash Gahlot as a conspiracy, it now faces the challenge of answering questions raised by former AAP member and whistleblower Neil Terrance Haslam.

Haslam backs the income tax department's stand that the raids were conducted to investigate the routing of black money by companies run by the minister’s family. He also said that recently, he had filed a complaint with the income tax department in this regard, after which the raids took place

The whistleblower had earlier alleged that the AAP had received Rs 2 crores as donations through shell companies.

Gahlot did not respond to multiple attempts by Firstpost to contact him to seek his response.

The income tax department on Wednesday launched a 24 hour-long raid at 16 premises connected to Gahlot. Officials had said that the searches were being conducted as a part of a probe against two firms — Brisk Infrastructure and Developers Pvt Ltd and Corporate International Financial Services Limited — linked to the minister

As per records with the Ministry of Corporate Affairs, Corporate International Financial Services Limited is a non-banking financial corporation. Haslam alleges that a big chunk of funds of this company came from dubious companies, and the money was routed to the companies owned by Gahlot and his family as unsecured loans.

It is a known norm that a bank or a non-banking financial corporation is not expected to lend money without adequate collateral. However, according to Haslam, this norm was not followed by Corporate International Financial Services Limited while handing out loans worth Rs 57.23 crores to the minister's family members and companies.

File image of AAP leader Kailash Gahlot. News18

File image of AAP leader Kailash Gahlot. News18

He said, “Kailash Gahlot and his family own 18 to 19 companies. If we analyse the balance sheet of Corporate International Financial Services Limited, we will see that from the financial year 2010-11 to 2014-15, unsecured loans were given to these companies and members of Gahlot's family. Can Gahlot explain why unsecured loans of such big amounts were handed out by the company?"

According to the complaint submitted by Haslam to the income tax department, the company lent Rs 7.66 crore to 11 companies and individuals in 2010-11, and Rs 31.62 crore to 13 entities in 2011-12. In 2012-13, the company is said to have given unsecured loans worth Rs 35.38 crore to 13 entities. In 2013-14 and 2014-15, it is said to have given unsecured loans worth Rs 47 crore and Rs 57.23 crore to 15 and 14 companies respectively.

Gahlot's name appears as one of the recipients of the unsecured loans in the last four financial years. According to Haslam's complaint, the minister received Rs 1.25 crore in 2011-12 and Rs 2.94 crore in 2012-13. The corresponding amounts in 2013-14 and 2014-15 are Rs 3.62 crore and Rs 1.34 crore respectively.

Haslam alleged that a part of the money paid to the companies as unsecured loans came from shell companies, as proceeds received from sale of equity shares, which existed only on paper. He further claimed that the unsecured loans were handed out to legitimise black money.

He said, “The company's balance sheet shows that in 2011 and 2012, it sold equity shares worth Rs 32 crores to these companies. To legitimise black money, these were shown as unsecured loans to the companies linked to Gahlot and individuals related to the same family.”

The complaint further claims that in 2011, the company sold 1,98,900 shares to a number of companies at the rate of Rs 990. In 2012, 22,730 shares were said to have been sold to these companies.

Similarly, Brisk Infrastructure and Developers Pvt Ltd allegedly transferred Rs 6.22 crores to the personal account of Kailash Gahlot and his wife. Haslam alleged this was done to route black money garnered through selling of large number of shares to Gahlot's family and close associates.

He also expressed suspicion that Corporate International Financial Services Limited fudged rent figures to evade tax.

“The company has never shifted from its address — House No A-14 Masoodpur, Opposite Chopal, New Delhi — and yet, rent has quadrupled in six years starting from 2011. This is quite abnormal,” he said.

He further explained, “The amount of rent paid for the official premises has a direct bearing on the profits earned by a company in a year. The more the rent, the less is the profit, and also the tax. An abnormal increase in rent in a span of six years smacks of attempts to evade tax.”

Ashok Agarwal, an advocate in the Delhi High Court, says that as per the prevailing law in Delhi, a landlord is entitled to an increase of rent by 10 percent every year. However, this is often decided through mutual understanding between the tenant and the landlord.

“There is no law which bars a landlord from increasing rent exorbitantly if the tenant is ready to pay such an amount. Often, with the help of this loophole, it is possible for a person or a company to fudge the documents related to payment of rent,” he added.

At a press conference called after I-T sleuths raided 16 properties with links to Gahlot, AAP leader Atishi alleged that the Centre was blatantly using internal agencies such as the I-T department, Central Bureau of Investigation, Enforcement Directorate and Delhi Police to intimidate AAP.

However, Haslam said, "The AAP should understand that such tactics are not going to work anymore. The party should answer the questions raised in my complaint.


Updated Date: Oct 13, 2018 22:23 PM

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