dna exclusive: Key Narendra Modi aide under IT scanner; ED may follow up on FEMA violation

After Narendra Modi’s right hand man Amit Shah, another close confidante of the BJP prime ministerial candidate has come under the scanner of a central agency. This time, the Income Tax department has launched an investigation against businessman Anand K Pandit for alleged investments in the British Virgin Islands, a tax haven.

Shah has been investigated by the CBI in connection with the Ishrat Jahan fake encounter case. 
The latest move is being seen as a bid by the UPA government to tighten the purse strings of Modi, as Pandit, a director on the board of Syndicate Bank, has been an active interface between the industry and the BJP in Gujarat.

Pandit’s name has figured in the list of 615 Indians who allegedly floated companies in the British Virgin Islands (BVI) to stash away undisclosed wealth, according to the data collected by the International Consortium of Investigative Journalists.

According to top sources in the ministry of finance, the decision to undertake a detailed probe was taken after preliminary findings pointed at some glaring violations of the Income Tax laws by Pandit, a businessman with diverse interests who was earlier convenor of the commerce cell of the BJP in Gujarat.

Pandit was a director on the board of Bank of Maharashtra when he floated a company in the British Virgin Islands in February 2008. He quit as director of Bank of Maharashtra in July 2012 and became a director on the board of Syndicate Bank.

Sources told dna that the I-T department is learnt to have found evidence of FEMA violations and that it would soon be sharing its findings with the Enforcement Directorate to initiate proceedings under forex rules. Moreover, the department has also found evidence of violation of the Prevention of Money Laundering Act, which will also be shared with the ED. “The investigation is at a preliminary stage, we cannot divulge information about it now,” a senior I-T department official said.

When contacted, Pandit told dna that he has not violated any law. “Sometime ago I did receive a notice from the Income Tax department. I immediately sent them a reply answering all the queries raised by them. I have received no notice from the ED. I am doing a legitimate business of real estate development in India. I have a small business in the US also. I have informed the relevant authorities about all my business dealings and have been paying all taxes regularly,” he said.