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Firm that gave loan to buy land from Robert Vadra received exemptions from I-T Settlement Commission: Reports

Bhushan Power and Steel gave Allegeny Finlease a loan of ₹5.64 crore to buy land from Vadra's company, and it got I-T exemption of ₹500 crore in the same year.

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OpIndia Staffhttps://www.opindia.com
Staff reporter at OpIndia

A report by The Indian Express has revealed a series of transactions that took place between BPSL (Bhushan Power and Steel) and Robert Vadra owned Skylight Hospitality via another company, which are under ED radar. ED has also asked for a response from Income Tax Settlement Commission (ITSC) which provided 500 crore exemption to BPSL, in contravention of rules.

The Bikaner Land Deal of 2011-12

Robert Vadra owned firm Skylight Hospitality had sold a plot of land in Bikaner district of Rajasthan to Delhi-based Allegeny Finlease Pvt Ltd. The 70-hectare plot amounted to ₹5.15 crore.

According to financial records of Allegeny Finlease Pvt Ltd., the amount used to buy the land from SKylight Hospitality came in the form of a loan from BPSL in the same year. BPSL gave ₹5.64 crore to Allegeny as a loan.

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Around the same time of the deal, in the month of December 2011, BPSL approached ITSC against a show-cause notice issued to it by Income Tax department. The notice was pertaining to income additions for assessment years 2004-05 to 2011-12 on various accounts that aggregated to over Rs 800 crore.

ITSC acknowledged the response and termed it ”not invalid” in February 2012, only to issue its first draft order in mid-June 2013. In its order, ITSC reprimanded BPSL for non-compliance with norms and provided no respite from IT Acts and punishment. Interestingly, a fortnight later, ITSC again issued a draft order, reversing its warning and exempted BPSL ₹500 crore, bringing down the questioned income addition to ₹317 crore. The reconstituted bench’s decision had completely turned the previous draft order which was issued merely two weeks ago, thus suspicious.

” ….considering the facts and circumstances of the case and the co-operation extended to the Commission during the hearing, immunity is granted from prosecution and penalty imposable under various sections of the Income Tax Act.” The changed draft order said.

During the investigation, it also turned out that land deal between Skylight Hospitality and Allegeny Finlease Pvt Ltd. was also high-priced. Reports say that Vadra’s Skylight Hospitality had brought the same land (Given to Allegeny) at seven times lower rate in Jan 2010, at ₹1 lakh per hectare. But it was sold to Allegeny at a whopping ₹7 lakh per hectare.

In the same year, Mahesh Nagar, an authorised representative of Skylight Hospitality, bought power of attorney on two parcels of land. It was sold to him by a real-estate agent.

At present, the land discussed in deals lays unused and taken over by weeds, on the Jaipur Highway near Gajner. Only the two parcel of land sold as power of attorney has a solar plant owned by Fronche in Gajner.

ED probe and responses from ITSC

ED has written to ITSC for details of the suspicious transactions. The ITSC has been asked to clarify why the decision taken in mid-June by ITSC was turned by the reconstituted bench. Preceding this letter written two months ago, ED had also written another letter on the same lines. At that time ITSC had answered that folders of transactions have got destroyed in a fire accident.

Chairmen of ITSC Akhilesh Prasad said that he is unaware of the controversy and he doesn’t know details about it, as it happened years ago. Indian Express also reported that there has no response from BPSL till date on the controversy.

In recent times this is the second time Robert Vadra has landed in trouble. We have widely covered the controversial links between shady arms dealer Sanjay Bhandari and brother-in-law of Rahul Gandhi, Robert Vadra. We had reported that Dassault had refused to partner with Bhandari’s Offset India Solutions (OIS) due to his proximity to Robert Vadra and that classified documents were found in his possession and was charged under the Official Secrets Act.

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OpIndia Staffhttps://www.opindia.com
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