Kathmandu, July 16
The Commission for the Investigation of Abuse of Authority today filed corruption cases against Director General of Inland Revenue Department Chudamani Sharma and two former office bearers of the erstwhile Tax Settlement Commission — Lumbadhwaj Mahat and Umesh Dhakal — at the Special Court.
The anti-graft body has accused Sharma, Mahat and Dhakal of embezzling Rs 10.2 billion.
Sharma and Dhakal were members of the TSC and Mahat its chair.
The anti-graft body has said in its charge-sheets that the three accused, while serving as office bearers of the TSC, acted to benefit themselves and to cause a loss to the exchequer.
The CIAA has alleged that the accused not only exempted taxpayers from paying taxes that they had evaded, but also entered into agreements with people to return them taxes collected by the erstwhile TSC. The anti-graft body said the TSC gave tax waiver on arrears of people who had accepted the government’s decision to levy taxes on them and it also exempted tax payers from paying the amount.
The CIAA added that the accused waived taxes of those firms and businesses that had used fake VAT bills. It has alleged that the three accused waived arrears of those tax payers who had filed cases against the government and had not withdrawn their lawsuits.
The anti-graft body also accused the trio of giving tax waiver on VAT voluntarily declared by firms and businesses.
It alleged that the accused entered into agreements with people on the last day of the TSC tenure to give them waivers, violating Section 17 of the TSC Act that stipulated office bearers should work in good faith.
The CIAA has sought punishment against the three accused in accordance with Section 3 (1) (h) and Section 7 of the Prevention of Corruption Act.
The Supreme Court, which is hearing a habeas corpus petition filed by IRD DG’s wife Kalpana demanding release of her husband, continued with the hearing today. The case will be heard tomorrow as well. If convicted, Sharma, Mahat and Dhakal could face imprisonment for eight to 10 years and would also have to pay double the amount they embezzled. Mahat and Dhakal are still at large.
CIAA sources said the commission could file additional cases of corruption against the three accused if it found
more incriminating evidences in the course of investigation. The CIAA has opened only 60 cases and has scores of other files to investigate.
The TSC had settled only 1,069 of the 1,726 applications that it had received on long-pending tax disputes. Though the TSC had received applications to settle pending taxes worth Rs 30.5 billion, the commission had recovered taxes worth only Rs 9.5 billion from businesses whose taxes had been pending since long.
Members of the Public Accounts Committee of the Parliament had wondered why the TSC had been able to recover only Rs 9.5 billion. PAC members had charged TSC members with exempting big businesses from paying taxes for mutual benefit. Sharma repeatedly faced criticism for not fixing and collecting applicable capital gains tax involved in the deal of Ncell between Axiata and TeliaSonera.
A version of this article appears in print on July 17, 2017 of The Himalayan Times.