No One Wants This Scandal

A meat trader wields his cleaver over the CBI, and other tales

Sadiq Naqvi Delhi 

It is estimated that around $500 billion of illegal money belonging to Indians is deposited in tax havens abroad. The largest depositors in Swiss banks are also reported to be Indians,” AP Singh, the then Central Bureau of Investigation (CBI) chief, told a gathering at the maiden Interpol global programme on anti-corruption and asset recovery in 2012. It was perhaps the first instance of a top official furnishing an estimate of Indians’ ill-gotten wealth parked in off-shore bank accounts.

In a surprising turn of events, two years later, Singh is being probed for his links with Moin Akhtar Qureshi, a shady meat exporter. After BBM exchanges between Singh and Qureshi were leaked to the media, there is an allegation that Singh, now a member of the Union Public Service Commission (UPSC), is in cahoots with the hawala operator who is being investigated for money-laundering and tax evasion.

The Income Tax Department has asked Singh to furnish details of his income and properties. The ongoing investigation has not just unnerved Singh but other CBI officials too. “There are a number of top CBI officials who could come under the arc of the probe,” says a source. “You look at the way the CBI is going about investigating cases in the past two years and you will figure out for yourself why they are worried and how deep is Qureshi’s influence in the system,” another official says.

Even the current CBI chief, Ranjit Sinha, is deeply worried about the agency’s reputation since the case came out, according to an investigator with the Finance Ministry. In May, Sinha shot off a letter to the Central Board of Direct Taxes (CBDT) Chairman, seeking details of the investigation that the agency was pursuing against Qureshi. In his letter, the CBI chief asked the CBDT to provide him with any evidence that the IT Department may have amassed during the course of its probe against any present or former CBI officials so that proper action could be taken. The letter was leaked to the media.

Unlike the usual procedure in such sensitive cases, Sinha also gave out a statement in which he said a ‘witch hunt’ against the CBI was afoot. He also expressed anguish over the matter being selectively leaked to the media.

Sinha’s request for information on the contents of the investigation was turned down by the Income Tax authorities. It is learnt that Finance Minister Arun Jaitley himself directed the IT department to exercise restraint and not share any information until the probe is complete. Soon after he took charge as the Finance Minister, Jaitley was given a special briefing on the high-profile case.  

The case has indeed set off a tug-of-war between the many agencies. The CBI is not the only one which has been denied information since the case came to the fore in March this year. Even the Enforcement Directorate (ED), the agency entrusted with investigating cases which have a money-laundering aspect to them, has been kept away from the case. “It is quite surprising and suspicious how the case has not come to us till now,” says an ED investigator. “Both the Income Tax Department and the ED are under the same Finance Ministry, I don’t understand what the problem is that they are not ready to share details with us.”

The ED officials say that although tax evasion is apparent in the case, they are still not clear why the IT Department has not sought their support to unearth the whole network. “It is clear that Qureshi has more wealth than he has declared and they can, of course, do it on their own under the double tax avoidance treaty. But there is a violation of Foreign Exchange Management Act. The case should have come to us,” the official says.  Even several weeks after the IT Department said it would seek ED help, the case is yet to come to the agency.

Who is Moin Qureshi?

Qureshi’s name drew a blank from most people until Narendra Modi, then the BJP’s Prime Ministerial candidate, raised the issue in an election rally in Akbarpur — claiming that the exporter’s links reached right up to 10 Janpath, the official residence of Congress President Sonia Gandhi. This allegation differed from his usual complaint about meat subsidies or what he called the ‘pink revolution’.

Modi was referring to the IT Department raids on Qureshi in February this year, which unearthed unaccounted wealth to the tune of `20 crore. Reports suggest that the actual amount of ill-gotten money may run into several hundred crore. The raids at many of his Delhi properties, including his office in Defence Colony and his residences in Chatarpur and Rampur, unearthed not just unaccounted-for cash stuffed in lockers, but also conversations that Qureshi himself had recorded with many of his powerful clients. “The chatter on those tapes is interesting. In fact, there used to be a mad scramble among officials to listen to his telephone,” says a source. The IT Department officials reportedly unearthed wealth many times more than the turnover of his several companies put together.

Files with the Registrar of Companies show Qureshi as an active director in only two firms during the 1990s — Glory Exports Private Limited (since 1994) and Juneja Marketing Private Limited (since 1996). Flagship firm AMQ Agro was incorporated in 2003. Qureshi has 25 other firms registered with the Registrar. “Money-laundering through the meat business is easy. First, there is no major investment and no cap on the amount you can export. Second, since the agencies have been told to go easy on the meat traders for they mostly come from the minority community, they mostly usually to evade the law,” says an official.

This story is from the print issue of Hardnews: JULY 2014