TN Minister a ‘silent partner’ in illegal mining

C Shivakumar @ Chennai:

A Cabinet minister in Tamil Nadu government is a silent partner in SRS Mining, the firm whose proceeds are now under the scanner of Income Tax department, Enforcement Directorate and Central Bureau of Investigation for tax evasion and money laundering.

It is learnt from the state government sources, which have access to a report submitted by Income Tax department, that the minister is the fourth ‘silent partner’ in SRS Mining and holds 20 per cent stake.

The other three partners in SRS Mining are J Sekar Reddy, Rathinam and Ramachandran. The company was under the scrutiny of Income Tax, which conducted searches last year at various places of Sekhar Reddy, managing partner of SRS Mining and seized about Rs 97 crore of old currencies (which were demonetised), Rs 34 crore of new currencies (that was circulated post demonetisation) and about 177kg of gold bars.

After Central Bureau of Investigation registered FIRs against the three partners for converting demonetised currencies to new currencies, ED had started quizzing those involved in the case. 

It is learnt from the Income Tax department that the earnings from the illegal sale of sand across the state is worth Rs 120 crore per month.

It is learnt that the profits are being divided by the partners.

Sources told that the minister gets 20pc of share from the sale of illegal sand.

Interestingly, during the investigation by Enforcement Directorate, it was learnt that the partners of SRS Mining has stated that they used to transport huge unaccounted cash by road and admitted they have not maintained any accounts against the collections, expenses to conceal the illegal earnings from the accounted income.

It is alleged that the partners through SRS Mining buy the sand at cheaper rate from the government mines and do the second sales at stackyard without any receipts thus avoiding value added tax and other taxes paid to the government.

A total of 400 cubic feet of sand being sold in government mine is worth approximately Rs 1,300. However, it is learnt that sand is unofficially sold for more than Rs 10,000. “The sale depends on the size of the vehicles and per load is being sold at Rs 10,000, Rs 8,000 and Rs 6,000,” sand mining sources added.

During investigation it was revealed that the unaccounted cash fromSRS Mining was used to buy the gold bars.