Ramesh accused of `74 cr scam

After eight days of investigation against TD MP C.M. Ramesh, income tax sleuths zeroed in on a dubious transaction to the tune of `74 crore done by Rithwik Projects Pvt Ltd (RPPL), in which Mr Ramesh is director. This apart, the department alleged that another firm linked to the Rajya Sabha member, also a close aide of AP Chief Minister N. Chandrababu Naidu, had siphoned off `100 crore through fake transactions with sub-contractors.

The IT sleuths have so far seized `13 lakh cash, $3,000 and several documents from his residence. A source said, “The RPPL has been found to have allegedly siphoned off `74 crore through untraceable transactions, while bills of `25 crore have been allegedly found to be dubious.”

The probe found that a sub-contractor, M/S EDCO (India) Pvt Ltd, was paid `12 crore over the past six years by RPPL. However, the company could not be found at the four addresses mentioned in the records.

The probe also found that correspondences of EDCO were received by one Saibaba, who is an accountant with RPPL. Saibaba was found to possess the stamp and seal of EDCO.

“During questioning, neither Ramesh nor his accountant were able to justify a bill worth `33 crore purchased for a commission and there was no account of cash amounting to `23 crore. This apart, the company received `12.24 crore from steel suppliers but the cash transaction could not be explained. Another mail attachment showing `7.98 crore cash received from steel suppliers for two per cent commission was also found.

A payment of `6 crore to a Delhi sub-contractor, M/S NKG Constructions, could not be substantiated as no bill for the transaction was found.

On the October 12, teams from income-tax department raided the residences and offices owned by Mr Ramesh in Hyderabad, Kadapa and Delhi.

During the raids the tax men seized several documents which revealed fraudulent transactions made by two companies of which the Rajya Sabha MP is the director.