The Income Tax department is likely to summon on Friday the Coimbatore stock broker whose house was searched and US treasury bonds worth Rs 28,000 crore were seized on December 31.
A government source told The Indian Express that the broker is likely to be called for interrogation to the Chennai I-T office while the department will also make a request to the CBDT for approaching the US revenue officials for verifying the bonds.
The source said the authenticity of the bonds is yet to be established and “there are plenty of fake bonds one can download from the internet”.
“We should be able to crystallise the information we have by the end of the next week. We have also sent the matter to the Chennai office of the enforcement directorate (ED),” the source said.
When contacted, Rajan Katoch, director, ED, declined to comment saying he was not aware of the development. The source also added that now the matter was being handled by the investigation wing of the Central Board of Direct Taxes (CBDT), Delhi.
The tip-off about the broker, T M Ramalingam, had come from the branch of a foreign bank in Chennai, following which raids were conducted at his residence at Upputhurai Palayam village on Dharapuram-Palani Road, Coimbatore. The tax department seized documents from the premises which also included US bonds worth Rs 28,000 crore.
Ramalingam trades in groundnut peeling equipment, and made frequent trips to Australia, Malaysia and Indonesia. A year ago he had applied for sanction to set up an oil refinery in Thondi at an investment of Rs 1,000 crore.
Even Indian banks cannot hold US bonds in the country, they can only hold such papers abroad. Bond market experts suspect the money was routed through a shell company set up abroad to satisfy the KYC requirements of US markets.
US Federal Reserve papers carrying any Indian name and address are illegal. The reason Ramalingam held the bonds in physical form in India was possibly to preclude their sale to book profit by associates abroad.
An Indian citizen can hold foreign currency assets of up to $200,000