Apex court sends Hasan Ali into ED custody

Expressing anguish at the manner in which principal sessions judge M L Tahaliyani on March 11 granted bail to Pune businessman Hasan Ali, who is accused of evading income tax of Rs80,000 crore, the Supreme Court on Thursday directed that the accused be sent back to the Enforcement Directorate’s (ED’s) custody.

Ali had been let out on a bail of Rs 80,000 and after his release he had challenged the Income Tax department’s demand for Rs80,000 crore towards defaulting tax arrears.

On a petition by the ED, a bench of justices B Sudershan Reddy and S S Nijjar stayed Tahaliyani’s order saying: “The  way the proceedings were conducted, we are deeply disturbed”.

“The order passed by the learned judge has created an extraordinary situation which may ultimately frustrate the entire investigation. Having regard to the extraordinary situation, complexity of the issue and the magnitude of the case, we deem it fit to stay the order,” the bench said.

Referring to the lengthy order passed by judge Tahaliyani, the apex court wondered, “why has the learned judge written so much?”

The judges had initially remanded Ali, 53, in the ED’s custody for 72 hours but extended it to four days following a plea made by solicitor general (SG) Gopal Subramanium.

The solicitor general claimed that the ED was in possession of “incriminating evidence” against Ali showing that he had stashed away huge amounts of black money in banks abroad.

He said Ali had withdrawn about $60,000 from a Swiss bank and cited communications from Swiss official sources to substantiate the allegation.

Judge Tahaliyani had rejected the ED’s plea for custodial interrogation of Ali on the ground that the agency could not prove any “scheduled offence” against him to justify its plea. He had also slammed the ED saying some of the “confidential” evidence provided by it was available in “Wikipedia”.

Ali, who has also been accused of forging documents to get multiple passports, was arrested under the Prevention of Money Laundering Act.

Ali’s name figures prominently in the list of black money hoarders that forms part of the petition filed by noted lawyer Ram Jethmalani and others before the apex court.

At a recent hearing, the Supreme Court had slammed the agency for its inertia in nabbing Ali. It castigated the ED saying: “What the hell is going on in this country?”  The very next day the ED arrested him.

Meanwhile, Ali is expected to reply to the I-T department’s show-cause notice on March 21, the paperwork for which is complete. However, given the supreme court order, he may not be able to do so in person.

According to Ali’s lawyer Ramakant Gaur, they are confident of coming out clean and the agencies still do not have sufficient evidence against Ali. “We have mainly posed three questions to the I-T pertaining to showing evidence of any transaction which could create the kind of amount they have quoted…,” said Gaur.

Towards the end of the 13-page show-cause notice sent to Ali on February 24, 2011, there is a list of 35 instances of undisclosed income or expenditure incurred by Khan amounting to Rs372,72,52,70,413.

This includes a major share of Rs 3,59,47,418 for an “unexplained transfer” to Ms SK Financial services.

“During the search, incriminating documents and digital data were seized which clearly show several bank accounts in foreign countries were maintained and operated by you and evidence was found of transfers of substantial amounts in and out of your bank accounts in foreign countries,” reads the IT department’s show-cause notice.

However, Gaur reiterated that they “have categorically denied the allegation of foreign funds allegedly stashed in UBS”.

Hasan Ali makes ED chase him all day
In spite of the Supreme Court’s order Hasan Ali Khan remained untraceable and the Enforcement Directorate’s search for him continued all day long.

After a whole day of suspense Khan’s lawyer IP Bagadia finally broke silence late in the evening that Khan shall surrender only after his review petition is admitted in the apex court.

However even later in the night Bagadia added to the confusion by saying that Khan may either surrender late Thursday night or on Friday.