Mumbai Man Held in Custody Over Rs 263-Crore Income Tax Fraud Case

In a significant development in a high-profile money laundering case, a special court under the Prevention of Money Laundering Act (PMLA) has remanded Purshottam Chavan to 14-day judicial custody. This decision comes in light of his alleged involvement in a massive Rs 263-crore income tax refund fraud. The Enforcement Directorate (ED), leading the investigation, has highlighted Chavan's active participation and crucial role in laundering the proceeds of this crime.

The arrest of Chavan on May 20 followed closely after the ED conducted raids on his premises in Mumbai. Upon the conclusion of his remand period, he was presented before special PMLA judge MG Deshpande, who ordered his judicial custody as proposed by the ED. The agency has accused Chavan of destroying evidence crucial for tracing the end utilization of the laundered funds.

Despite undergoing custodial interrogation, Chavan reportedly withheld information regarding the receipt, mode, and further utilization of the funds. Additionally, he failed to disclose pertinent facts about property documents recovered from his residence, further necessitating his judicial custody to prevent any obstruction to the ongoing investigation.

The case revolves around the fraudulent generation and issuance of Tax Deducted at Source (TDS) refunds by the Income-tax department, amounting to Rs 263.95 crore. This case, initially registered by the Central Bureau of Investigation (CBI), forms the basis for the ED's money laundering investigation.

Previously, the ED had arrested key figures in this case, including the main accused and former senior tax assistant Tanaji Mandal Adhikari, along with Bhushan Patil, Rajesh Shetty, and Rajesh Brijlal Batreja. Notably, Batreja and Chavan were found to have exchanged incriminating messages concerning hawala transactions and the diversion of crime proceeds.

To date, assets worth Rs 168 crore belonging to various accused individuals have been attached as part of this investigation. In September 2023, the ED filed a charge sheet against Adhikari and ten others, marking a significant milestone in this high-stakes money laundering case.