ED had issued notices to Abhishek Verma to recover penalties; Verma told this paper the matter is sub-justice before Delhi HC.


New Delhi: Officials at the Enforcement Directorate (ED), Finance ministry, on the direction of Finance Minister Nirmala Sitharaman, have moved to execute a penalty demand of Rs 32.5 crore on Abhishek Verma, something that they had to originally execute in March 2005 more than 16 years ago.

On 10 June 2021, in a total of seven penalty orders—that pertain to execution of penalty imposed by ED in March (four orders), April (two orders), May (one order) 2005—the ED had issued notices to the Delhi-based businessman, asking him to deposit the said penalty that has been pending since 2005.

In between these two periods (March 2005-June 2021), the country saw 10 finance ministers.

The total amount of penalty imposed on Verma on the basis of these seven orders is Rs 32.5 crore. The said orders were passed by the Office of the Special Director of Enforcement, Directorate of Enforcement, in various months of 2005 to realize the penalties from Verma as arrears of land revenue under the provisions of Foreign Exchange Regulation Act (FERA, which now has been repealed).

However, till now, the said order had not been executed. As per an official communication sent by a member, CBDT, K.V. Chowdhary in May 2014, to the then CBI Director, Ranjit Sinha, while responding to Sinha’s queries on the cases being investigated by the CBDT against Abhishek Verma, Chowdhary stated that a total of Rs 108 crore was outstanding as penalties that were to be recovered from Verma.

In June 2020, Edmond Allen, the New York-based former business partner of Verma, had written to Nirmala Sitharaman detailing the “non-recovery” of dues by the Income Tax department and the ED that have not been executed against Verma by the ministry officials.

Verma had filed a case in the Delhi High Court in 2006 against the March 2005 ED order imposing penalty on him which was dismissed in October 2010. On 16 April 2021, he moved an application to revive the said petition, about 55 days before he received the ED recovery notice on 10 June.  However, the court, while dismissing its petition, stated that it does see a sufficient ground to condone the 3,802 days of delay or 11 years of delay in filing the said petition by Verma.

Abhishek Verma told The Sunday Guardian:

“All these matters are sub-justice before Mrs Justice Rekha Palli Hon’ble Delhi High Court and the next date is 14th December 2021. The FERA act was repealed in 2002. Adjudication notices were issued in 2005; therefore, illegal as these were adjudicated after the Act was repealed and after the sunset clause. These FERA cases were lodged by Ashok Aggarwal, IRS former deputy director of ED in 1999 against whom I was the approver of CBI. In his affidavit to Supreme Court, Ashok Aggarwal had admitted this fact that he was instrumental in lodging these 9 cases against me. Just day before yesterday, Ashok Aggarwal’s petition for reinstatement in IRS service was dismissed by Chief Justice of HC Mr D.N. Patel by a 54 page order. Aggarwal was dismissed by Govt in 2017-2018.

Aggarwal and Allen are working together and we have ample documentary proof which CBI is aware of. Also, ED sending demand notices after 17 years are covered under Limitation Act. Therefore, there is technical flaw in these notices and the High Court is seized of these 9 notices and thus the matter is sub-judice. Allen has circulated malicious email recently to all journalists with these demand notice copies and we are in the process of initiating complaint under the Official Secrets Act against him as he stole these documents from ED. We are also moving contempt notice against Edmond Allen in Delhi High Court for the same issue for trying to influence press and others and for stealing papers from ED of a matter which is sub-judice and in which he is not a party. There is a police case against Allen in Sabzi Mandi Delhi police station for stealing CMM Tis Hazari’s signed order sheets and Delhi police is investigating the source who supplied these documents to Allen, that were seized from Allen’s lawyer, Ms Mayuri Shukla by CMM court in front of the judge while proceedings were on in court.”