Chennai: The recent CBI raids on DMK leader and M Karunanidhi's son MK Stalin revealed an elaborate smuggling scam amounting to a Rs 50 crore tax evasion. The incident led to a huge controversy with not only the Opposition parties but also the government questioning the raids. While no illegal car was found in the DMK leader's house, the CBI did recover several vehicles from others - notably N Srinivasan.
On Friday night CBI seized 11 cars belonging to BCCI chief and India Cements promoter N Srinivasan but the car import racket mastermind Alex Joseph is still absconding. CNN-IBN accessed documents that indicate that officials within the Directorate of Revenue Investigation (DRI) are complicit in the scam.
Alex Joseph is the man behind the illegal car racket. Joseph is accused of smuggling high-end cars and evading crore of rupees in customs duty. Many BMWs, Rolls Royce and Mercedes Benz ended up in the parking sheds of high profile names.
The modus operandi of this racket was very simple. Joseph, in connivance with former DRI officer Muruganandan, would import cars and get the duty waived off. This caused a loss of nearly Rs 50 crore to the state treasury.
CNN-IBN accessed the details of the CBI's FIR which states Murganandam was working as a Senior Intelligence officer with the DRI in Chennai between 2008-12 when he colluded with Alex Joseph. During the period Joespeh imported 33 vehicles illegally. He later tampered their chassis, engine number etc, forged invoices and import documents and sold them. The purchasers knew the vehicles were imported wrongfully.
The Central Economic Intelligence Bureau had booked Joseph and passed detention orders as far back as April 13, 2000. To avoid arrest, Joseph, fled to the UAE under the name Abey John. He continued his operations from Sharjah. Joseph relied on an ingenious route to smuggle cars.
He would pay NRIs in the Gulf to send cars to India using their passports, relying on the Transfer of Residence facility provided to NRIs. Under this, the NRIs can bring used cars to India by paying nominal customs duty. Jospeh smuggled the cars through different ports to avoid attention.
The smuggled cars were sold at prices between Rs 30 lakh and Rs 1.25 crore to film personalities and politicians in Mumbai, Kerala and Chennai. Over the past four years several alerts were raised but nothing was done.
On March 06, 2008 DRI got information that Joesph imported 12 vehicles through Chennai. Again on March 12,2008 DRI got information Joseph imported eight more vehicles. On March 19,2008 the agency got information of import of nine more vehicles. Each time as senior intelligence officer, Muruganandan was entrusted to probe but he took no action.
Apart from Srinivasan, the CBI also raided the residences of the chancellor of a medical college, several other businessmen and the MGM Group of Companies. The CBI seized seven cars from the Chancellor of Sri Ramchandra Medical college, five vehicles from GK Shetty Ramanna, two each from the MGM Group of companies and Raja Shankar, and one automobile from the owner of JRA Towers group.
The raids came a day after the residence of DMK's political heir Stalin was searched allegedly for an imported Hummer. The operations, however, were called off soon after the opposition targeted the government, calling the raids "political vendetta", as they came just days after the DMK withdrew support from the coalition government.
CBI officials believe that these findings could just be the tip of the iceberg. But the big question is what is the involvement of people like Srinivasan in the scam? And how many more officials in the DRI are involved?