Ed Gets 6 Months To Wrap Up Swc Probe

According to an Enforcement Directorate source, the investigative process is quite lengthy and most of the intelligence gathered by the directorate in the past one year needs to be corroborated

The Enforcement Directorate (ED) has got a six-month extension to complete the on-going probe against liquor major Shaw Wallace & Co. The show-cause notice, along with the chargesheet, would have to be issued to the company by the end of this month.

This would complete six months since the beginning of the investigations into the case.

The extension follows a similar one given for completing the ITC case which is currently pending with the directorate.

 

The main reason for seeking an extension to complete the inquiry is the non-appearance of the company's non-resident Indian chairman Manohar Rajaram Chhabria at the Enforcement Directorates premises for interrogations, despite four summons having been already sent to him in Dubai.

Also, his brother-in-law Niranjan Thakur also did not honour a number of summons sent to him.

According to an ED source, the investigative process is quite lengthy and most of the intelligence gathered by the directorate in the past one year needs to be corroborated.

This can be done by written or recorded statements from key suspects in the case, namely chairman M R Chhabria.

The court of the chief metropolitan magistrate is yet to send summons to Chhabria and Niranjan Thakur against whom the Enforcement Directorate has commenced criminal proceedings for not honouring summons sent for interrogation.

Meanwhile, the pro-be in the case is still on in Calcutta.

The Enforcement Directorate authorities are trying to find out where the cash flowback into the company has been parked after a 8 per cent deduction for sales promotion service charges in the liquor and beer divisions had been made.

It is believed that of the persons probed so far, the department has received conflicting replies in relation to this aspect. It is felt that only Manohar Rajaram Chhabria and Niranjan Thakur could provide exact answers to these queries. This is because Manu R Chhabria and Niranjan Thakur are believed to be the most likely beneficiaries of the cash flowback.

The enforcement directorate officials are uncertain about the fate of ITC and Shaw Wallace cases which shook corporate circles last year.

An official source pointed out that if reports are true, and the new laws such as the Foreign Exchange Management Act and the Money Laundering Bill, which have been proposed to replace the existing Foreign Exchange Regulations Act under which these cases are booked, are passed with retrospective effect, most of the investigative efforts put in the last few years by the Enforcement Directorate officials will be undone.

"Both the new laws being drafted, are watered down, diluted versions of Fera," said the source.