More Notices For Itc Likely In Fera Violation Case

The Enforcement Directorate is set to issue at least two more showcause notices to tobacco major ITC Ltd in the alleged $110 million Fera violation case.

The adjudication process in the case has already begun with top ITC officials reportedly sending in their initial responses to the chargesheets issued in July. The notices are currently being vetted at the ED headquarters in New Delhi and are expected to be issued shortly. More notices are underway subject to reports and additional information coming in from the Calcutta zonal office, point out senior ED sources.

Already, the directorate has issued as many as nine such notices to the company in three lots, over the last few months.

ITCs directors who have been chargesheeted are in the process of furnishing their replies which may prove that the contravention took place without their knowledge and all due diligence was exercised to prevent such contravention. However, ED officials were tightlipped about the contents of the responses.

Meanwhile, the Calcutta zonal office of the enforcement directorate is in the process of returning documents seized during the directorates raids on the companys premises.

These papers, it is believed, will be scrutinised by the special commitee of top ITC officials set up especially for tackling this case.

Interestingly, no show cause notices as yet have been served in the names of Asutosh Garg and Shriram Khattar, two senior directors of ITCs Singapore-based subsidiary ITC Global, by the enforcement directorate as yet. The notices have not been issued to these two officials as they were not residing in India during the period (1991 to 1994), for which investigations are being carried out for the overall $ 110 million alleged Fera contravention case. It is unlikely any notices will be issued in their names in the subsequent lots, till the ED takes a definite decision relating to the issue.

Technically, as they were non-resident Indians during this period, the offences were alleged to have been committed, they are not bound down by Indian laws for that period.

On the other hand, according to informed sources, the first lot of showcause notices to liquor major Shaw Wallace & Co are expected to be issued within this week.

This will serve to defuse the ongoing tension that is supposedly simmering between the income tax department and the ED, over handing over of statements recorded in the SWC case to the income tax department.

The Income Tax department had earlier requested the ED to share vital documents and statements in their possession in order to complete the post search block assessment, the due date for which expires on November 30.

The EDs stand is that unless the show cause notices are issued, it will not be possible to part with the statements.