COLOMBO: The Colombo High Court yesterday refused to grant bail to a chairman of two garment factories who was taken into custody for the alleged misappropriation of VAT funds.
Colombo High Court Judge Deepali Wijesundara refusing to grant bail to Sinnaiyah Subramanium chairman of Lotus Garments (Pvt) Ltd, Pethiyagoda and Upali Garments (Pvt) Ltd, Ja Ela, observed that the suspect was alleged to have misappropriated a large sum of money from public funds and there should be special reasons to grant bail to such suspects before serving indictment.
Further, the Judge observed that there was an ample possibility for such a suspect to flee the country.
Filing the bail application through Attorney Thejitha Koralage, petitioner Ponnasami Periya Thanemose, wife of Subramanium stated that her husband along with four others were taken into custody on March 29, 2006 by the Commercial Crime Investigation Division of the Criminal Investigation Department in connection with an alleged misappropriation of Rs. 3.57 billion of Income Tax Department funds.
The petitioner further said that her husband was produced the following day and was in remand custody since then. She said that her husband was an employer of 510 employees and it was difficult to run the business without him. His presence was essential for a discussion with a foreign company to obtain an order to supply garments worth of US $ 5.2 million.
State Counsel Sanjeewa Dissanayake objecting to granting bail stated that there were cases filed against the suspect before the Gampaha Magistrate Court and the suspect had evaded appearing before the Court.
State Counsel Sanjeewa Dissanayake appeared for the Attorney General while President’s Counsel Rienzie Arsakularatne and Attorney Wasantha Batagoda appeared for the petitioner.
Earlier the seven suspects including a senior officer attached to the Inland Revenue Department who had been remanded in connection with the VAT scam were further remanded till February 21, by Colombo Fort Magistrate and Additional District Judge Namal Balalle.
The Criminal Investigation Department (CID) is probing the massive VAT racket at the Inland Revenue Department.
Senior State Counsel Sanjeewa Dissanayake appeared for the Attorney General.
President’s Counsel Rienzie Arsacularatne instructed by Gowri Thavarasa appeared for the suspect.
http://www.dailynews.lk/2007/02/16/news20.asp
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VAT scam biggest swindle in South Asia - Senior State Counsel
AsiaViews, Edition: 13/III/April/2006
Judge commends CID efficiency
COLOMBO: The multi-billion rupee VAT fraud at the Inland Revenue Department (IRD) was termed as the biggest ever swindle in South Asia by Senior State Counsel Haripriya Jayasundera who appeared for the Attorney General in the case along with the Criminal Investigation Department (CID) when the matter came up before the Colombo Fort Magistrate and Additional District Judge Namal Balalle yesterday morning.
The Judge further remanding the five suspects in custody till April 19, directed the CID to take all measures to preserve every document and other relevant papers connected with the case by transferring all such documents into a
computer disc and entrusted into the safe custody of a responsible officer of the CID.
“In a case of this nature there is a possibility of tampering with the documents. This is a national crime, therefore the CID should take every precaution to prevent any tampering or loss of documents pertaining to the case,” he said. For further instructions on this matter, the Judge directed the CID to obtain the Attorney-General’s assistance.
The Judge paid a tribute to CID officers investigating the VAT scam for their efficiency in forwarding the investigation reports to the Attorney-General in a very short period.
On an application by Kalinga Indatissa, Counsel for the first suspect, Gnanasiri Soysa Jayatilleke, former Senior officer of the Inland Revenue Department VAT Division, the Judge directed the CID to transfer all data to Inland Revenue Department VAT division computers in connection with the money transactions to a computer file and keep it in safe custody.
Senior State Counsel Jayasundera said the CID had forwarded the investigation reports to the Attorney-General. There are several more statements to be recorded from Bank officers and to obtain documents pertaining to several transactions.
The Judge allowed an application by the CID to obtain several documents from the banks and to record statements of bank officials. The Senior State Counsel objected to an application by K.V. Thavarasa, Counsel for businessman Subramaniam, to allow the suspect to sign cheques to pay wages of around 1,000 employees of his factories.
According to the investigation the amount misappropriated from the Inland Revenue Department under the pretext of VAT refunds is over Rs.357 million.
The CID produced five suspects including Gnanasiri Soysa Jayatilleke, a former Senior Officer attached to the Inland Revenue Department’s VAT Division, Colombo businessman Sinnaiah Subramaniam, Mohamed Hussain Mohamed Milshan, Ambepitiya of the Inland Revenue Department and leading Cinnamon Garden businessman, Ashrof Hadjar,
The CID told court that they have perused the forged documents forwarded to the Inland Revenue Department for the release of VAT money from the Department.
The Court earlier suspended the passport of the businessman who allegedly assisted the former Senior Inland Revenue officer in the VAT scam.
Court directed the CID to inform the immigration authorities about the Court order suspending the suspect’s passport.
The fraud came to light when the CID investigated on a complaint by the Inland Revenue Department based on a report submitted to it by the Auditor-General in connection with a criminal misappropriation of Rs. 3,573,272,868 accruing from the VAT.
Investigations revealed that a senior officer of the Inland Revenue Department had authorised to release this amount to the businessmen without perusing the documents.
The money had been obtained from the Inland Revenue Department on several forged National Identity Cards.
Twenty National Identity Cards had been submitted to the Inland Revenue Department but 19 are forged, investigators told court.
President’s Counsel Daya Perera, President’s Counsel M.L.M. Ameen, Kalinga Indatissa, Lakshman Ranasingha, Shiraz Noordeen, K. V. Thavarasa, Deemani Beddewela, Jayantha Dias Nanayakkara, A.C. Misbiah, S.A. Villavarayan, Jayaki de Alwis, S. Kalupahana, Gowri Thavarasa, M.C.M. Muneer, M. R. Ameen, Sarath Liyanage, Indika Attanayake, M.S.M. Kamil, Ranil Samarasooriya and Hemantha Gamage appeared for the suspects.
By Sarath Malalasekera
Daily News, Sri Lanka, April 6, 2006
Comment by lankabuzz — February 16, 2007 @ 5:55 am
LOCAL-
VAT fraud runs into billions
Apr/9/2006
By Staff Writer
The tax fraud at the Inland Revenue Department could run into around 24 billion rupees, CID investigations reveal.
Inspector General of Police Chandra Fernando said though initial investigations reveal the amount to be 3.57 billion rupees, sleuths would also trace the where-abouts of a total of 24 billion rupees which was paid as VAT repayment.
The IGP also said the CID was investigating to locate the money and also whether the money had been invested on any property or business ventures. The main suspect, Kamil Kuthubdeen, who is absconding, is reported to have fled the country.
Kamil Kuthubdeen is the chairman of the BOI approved K-Port Development Project, which is a private sector venture, set up for specific operations in handling, storing and delivery of cargo of international trade.
The company website www.kport.lk has a mug shot of Kuthubdeen, who designates himself as the chairman of the K Port signing an agreement with former BOI chairman Saliya Wickremesuriya. IGP Fernando however declined to comment whether the K Port project was now under investigation.
The Inland Revenue Department and the Department of Registration of Persons have already come under scrutiny by the CID. The IGP also did not rule out the possibility of the Board of Investment and Customs which may also come under CID investigations.
Colombo Fort Magistrate and Additional District Judge Namal Balalle last week further remanded five suspects in the VAT scam till April 19.
They were Gnanasiri Soysa Jayatilleke, a former senior officer of the VAT Division of the Inland Revenue Department, Colombo businessman Sinnaiah Subramaniam, Mohamed Hussain Mohamed Milshan, Ambepitiya of the Inland Revenue Department and a leading Cinnamon Garden businessman Ashrof Hadjar. The multi-billion VAT fraud came to light when the CID investigated a complaint by the Inland Revenue Department based on a report submitted to it by the Auditor General in connection with the criminal misappropriation of Rs. 3,573,272,868 accruing from VAT.
Investigations have revealed that the senior officer of the Inland Revenue Department had authorised the release of this amount without perusing the relevant documents. Investigators have also found that the VAT repayment had been issued on forged passports. Out of 20 identity cards submitted to the Inland Revenue Department, 19 were forged, investigators have found.(SO)
Comment by lankabuzz — February 16, 2007 @ 5:56 am
Vat scam: Kingpins flee
Thursday, 6 April 2006 - 3:15 AM SL Time
Latest CID investigations have revealed that four main suspects wanted in connection with the massive VAT scam involving billions of rupees have reportedly fled the country.
The suspects identified as Bakeer Mohamed Riyaz, Rasheed Murshid and Awam have reportedly fled to Singapore and Thailand while another suspect Mohamed Hussein had fled to Japan.
An investigator told the Daily Mirror the suspects had left the country from Bandaranaike International Airport between March 23 to 25 producing fake passports.
Rasheed Murshid a leading textile businessman and one of the two top players in the VAT scam is also known to have escaped abroad while the CID is on the look out for the other key player Kamil Kuthubdeen the shipping magnate.
According to the CID no trace of Kamil Kuthubdeen has been found yet nor is he known to have fled the country.
Comment by lankabuzz — February 16, 2007 @ 5:58 am
i only can say that when i new kamil , he was gennrasman , i think people are jelous off him
Comment by kairul — March 30, 2007 @ 3:21 pm
kamil kuthubdeen is inncocnet!!!!!!!!!!!!!
Comment by JAZEEMA KUTHUBDEEN — March 30, 2007 @ 3:31 pm