Rs 1.2 Cr to Settle Tax Appeal: How SP Group Exec Bribed IRS Officer

An executive of Shapoorji Pallonji Group was arrested on May 10 along with Indian Revenue Service officer Jeevan Lal Lavidiya over allegations of bribery to settle an appeal in favour of the infrastructure giant.

Viral Kantilal Mehta, the Deputy General Manager (Taxation) of Shapoorji Pallonji Group, allegedly paid Rs 15 lakh in bribe to middlemen of Lavidiya, who was overseeing the appeal on behalf of the Income Tax Department.

Jeevan Lal Lavidiya, an IRS officer of the 2004 batch, was currently serving as the Commissioner of Income Tax (Exemptions), Hyderabad. He also had the additional charge of Commissioner of Income Tax (Appeals Unit-8) & (Appeals Unit-7), Office of the Principal Chief Commissioner of Income Tax, Hyderabad.

According to the CBI FIR, he used middlemen named Natta Veera Naga, Sairam, Rayapureddy Narendra, CA, R/o Hyderabad, and other unknown officers in "corrupt and illegal activities of obtaining illegal gratification for extending undue advantages in deciding appeals in favour of the private parties whose appeals were pending with him for decision."

Other than SP Group, Lavidiya allegedly took bribes for at least four other tax appeal cases. These include a Rs 2.5 crore flat from NDW Development Corp, and cash payments of Rs 20 lakh, Rs 15 lakh, and another Rs 15 lakh in cases involving Ventura Securities, Anandrao Shitole, and Hemantkumar Rajendrakumar Shah, respectively.

The bribes were allegedly routed through benami accounts and hawala channels using middlemen, the FIR noted.

'Bribe Was Demanded'

The copy of the FIR said, "Lavidiya had demanded Rs 1.20 crore as bribe from Viral Kantilal Mehta, DGM (Taxation), Shapoorji Pallonji Group, Mumbai, to decide the matter in favour of Shapoorji Pallonji Infrastructure Gujarat Private Ltd., Vadodara."

Lavidiya was overseeing a taxation appeal pertaining to Shapoorji Pallonji Infrastructure Gujarat Private Ltd., Vadodara.

The commissioner had allegedly received Rs 15 lakh in bribes through his middlemen, Sajida Majhar Hussain Shah and Prakash Shambaji Pawar, deposited into the account of Landa Varahalu. An additional Rs 70 lakh bribe was reportedly being arranged by Kantilal Mehta of Shapoorji Pallonji Infrastructure Gujarat Pvt Ltd.

"Shapoorji Pallonji Group had requested Jeevan Lal Lavidiya to wait for the final submission from the company and for payment of Rs. 70 lakh as bribe to him (Jeevan Lal Lavidiya) as he (Viral Kantilal Mehta) has to obtain the permission from the management of the company. Source has further informed that the management of Shapoorji Pallonji Infrastructure Gujarat Private Ltd. has now given permission to Viral Kantilal Mehta for payment of Rs. 70 lakh to Jeevan Lal Lavidiya for their pending matter," the CBI said.

SP Group Responds

Following the arrest of Mehta, SP Group has denied any involvement in the matter and launched an internal investigation.

"The SP Group has been made aware of a serious allegation of misconduct against an employee of one of our Group Company subsidiaries. The alleged conduct was not with the knowledge of the Group, nor was it sanctioned by the Group. In fact, this goes against the very values and policies that the Group upholds in its business operations. The Group remains committed to fully cooperate with the relevant authorities in their investigations," the company said in an official statement.

Adding that given the seriousness of these allegations, the SP Group has already launched an internal enquiry into the alleged conduct and will take the necessary steps based on the outcome of the investigation.