The government is veering to a position that attempts to trace the source of the Niira Radia tape leaks may not fructify. While senior government officials said the search is still on, they have abandoned plans to set up a formal mechanism for the job.
Since 2005-06 when the income tax department got powers to tap telephone lines as an aid to tax surveillance, the use of tapping has now become almost routine in major cases. Any inquiry would lead to demands to muzzle the powers of the department to check tax avoidance and evasion.
Cases of suspected tax evasion are handled by the Directorate General of Income Tax (Investigations) in the department of income tax. Those, in turn, are referred to them by the income tax field formations in various states, when they are unable to prove there has been either tax evasion or avoidance, despite detailed examination of returns. The bulk of officers staffing the directorate, (about 200) are concentrated in the cities of Mumbai and Delhi, though their numbers are now increasing in the big cities of the South too.
While as in the Radia case, the authorisation for the tapping has to be issued by the home secretary, the tax directorate has set up an extensive machinery with the aid of the department of telecommunications to procure evidence from telephone conversations.
Senior officers said the number of transcripts that enter the records now are substantial. These are stored under the supervision of DGIT in the directorate, but as their usage has spread, the records are now being handled even at the level of additional directors. A formal inquiry could create a witch hunt as confidential records are stored physically under the charge of a more junior officer ? an assistant director. But records are released from the room only on clear authorisations. ?But we have never had a case of a leak of survey data from here?, said a source on strict condition of anonymity. ?We never share these (transcripts) with others, unless instructed. Our remit is to only track tax dues?. Only when there are other possible incriminating material, the DGIT refers it to the higher authorities.
?The results (including phone transcripts) could travel upward to the office of the member(investigations) in the CBDT, the revenue secretary and if necessary, to the minister?. The maintenance of the records in those offices, the source, is not under the purview of the DGIT.
The Radia tapes too were the result of a tax inquiry, but as the conversations seemed to indicate ?non-tax? issues, the directorate was asked to hand over the material to the CBI instead.
Tapping of phone conversations was authorised by the UPA government, mainly to track terror financing after India joined the so-called Egmont group of largely OECD nations which have begun pooling real-time data to track global money-laundering. The tapping records have also begun to be used to marshal additional evidence against suspects in cases of tax evasion. These, along with records of cash transaction and suspicious transaction from banks have helped the department cut down tax ?raids? which were often counter-productive and led to charges of harassment of assessees. Such raids gave the department a bad name and also created a scare among business that was obviously against the interests of the economy.
Supportive role in the new era of electronic surveillance came from tracking of high level of expenditure, annual information returns and such like. ?Bank data, for instance, is often incomplete, but we are often surprised by the leads they throw up,? said an officer of the department.
