When the Income Tax Department raided a small-time commodities trader in Dharapuram, a sleepy backwater town in Tamil Nadu, they weren’t expecting to find $5 billion (Rs 27,000 cr) in US Treasury bills of exchange lying in his desktop drawer.
“A friend from Brazil gave them to me,” was the only explanation that T.M. Ramalingam gave during interrogation, officers say.
“We are verifying the truth”, S. Murali Mohan, additional director of Income Tax investigating the matter told the media. “If the bonds are not fake, then he faces serious penalties,” said he.
Why the authenticity of the $5 billion international bills of exchange which Ramalingam held is being questioned even before their verification is unclear.
The IT department is assuming that the fortune they have uncovered belongs to Ramalingam, whose passport shows frequent trips to Malaysia, Indonesia and Australia, which is also unusual.
“In cases like this the subject is usually holding the funds for others, like in the Telgi case,” said a tax lawyer who requested anonymity. He says he can’t understand why the IT department believes the trail that led to Ramalingam stops with him.
Ramalingam is still being questioned and his assets have not yet been attached. But what appears to have brought him under the department’s lens was his own ambition.
“I had applied for setting up of a oil refinery unit in Thondi,” Ramalingam told a TV channel NewsX.
Given that the project’s cost was Rs 16,000cr and Ramalingam had not filed any income tax for the last four years, officers raided him on New Year’s day.
Crucial light could be thrown on the case by US authorities, who can verify to whom the bills were issued and transferred.
But while Mohan said American authorities will be contacted, he gave no more details. Meanwhile, the five pieces of paper worth $5 billion still remain in the possession of the IT department. But given the debate over their authenticity, they could soon be placed in judicial custody.
Meanwhile, Ramalingam’s case has reignited public ire over the government’s inaction on curbing black money.
So far, there’s been no official response from New Delhi. But with the billion dollar hoards being discovered regularly across India, the impression of policy paralysis that Manmohan Singh has been trying to shake off seems most severe in the sphere of black money.