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CBI raids on Karti opens the Pandora’s Box of Shell companies

Raids against Karti discloses involvement of many shell companies making it a complicated maze. CBI determined to eradicate corruption from the country.

The CBI search aggressively continues against Karti Chidambaram, as PM Narendra Modi has made it explicitly clear that he wants to eradicate corruption from the country at any cost. Gopal Aggarwal, the head of the BJP’s economic affairs cell, and a seasoned tracker of black money said that PM has clearly made it known that he wants to know who owns it.

Though strings of raids have been conducted by the CBI in Delhi, Chennai and Gurgaon, the Ministry of Finance keeps its focus on Kolkata, home to hundreds and thousands of shell companies. The major aim of these raids is mainly to get to the very grip on the shell companies Karti had allegedly created to divert what the investigators claimed as illegal cash and how many of these companies are owned by Karti or his associates. Investigations are also being carried against chartered accountants in Kolkata who helped open such shell companies.

Gopal Agarwal stated in an interview that some of the shell companies were operating out of letterheads and visiting cards, owned by various brokers and traders covering for corporate entities and even politicians. He also added that it was not any minor hunt, but the quest into Karti’s companies started more than a decade ago, but stopped midway for no reason. He further added that evidence have been found that brokers have pressurised financial institutions and market regulator Securities and Exchanges Board of India (SEBI) to suppress operations conducted through shell companies, both in India and abroad with the help of corrupt bureaucrats. He even said that these brokers would do anything to get themselves out clean if they were caught. They even challenge SEBI’s actions in the Security Appellate Tribunal (SAT) and even bribe and influence SAT members to pass the judgement in their favour.

Deepak Kanth, head of the BJP I-T cell said that a very complicated maze had been created with many companies within companies, but most of the puzzle is solved as the investigation agencies were able to join dots by dots.

During the investigation it was also revealed that the babus, lowly attendants and office secretaries are appointed as directors and shareholders in the companies owned by Karti.

Raids were even conducted on Vasant Healthcare in Kolkata early this year to probe money laundering and tax evasion charges following financial intelligence reports indicating Vasan’s connections with Karti. Strangely, Vasant  shut down some of its operations in Kolkata after the raids.

The agency has already registered a case against Arti Infosystems Limited for a Rs 138-crore bank fraud using a single shell company. Another company, Maheshwari Ispat is in the dock for a Rs 180-crore bank fraud using a shell company. While the companies that used multi shell companies are, Bengal India Global Infrastructure Limited for bank fraud worth Rs 170 crore using six shell companies. K.Live Space Style and Industries duped the banks of Rs 100 crore using four shell companies. There was Global Softech Limited carried out a Rs 126-crore bank fraud using 18 shell companies. SPS Steel Rolling Mills Limited duped the banks of Rs 70 crore using nine shell companies.

Though these reports were already submitted by the Enforcement Directorate earlier this year after a nationwide raid on companies suspected of money laundering on individuals and companies including two top politicians.

There are also the possibilities of CBI demanding the arrest of a host of Trinamool Congress MPs and legislators caught on tape taking cash from an investigative journalist for granting favours for investments in Bengal.

Seasoned political commentator MD Nalapat  said “The prime is hitting where it hurts most, the jugalbandi of corrupt bureaucrats and politicians.” He feels that the government is implementing every possible steps and strategy to eradicate corruption from the country.

Seasoned political analyst Mohan Guruswamy said “If the Prime Minister is keen to clean up the country, there should be no exceptions, else it will be called a vendetta by the Opposition parties.”

CBI and income tax officials said that their probe has just begun and will only end when the country will be free of corruption.

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