AXIS BANK, CASE 7: V. JUNEJA, MANAGER (OPERATIONS/INVESTMENTS); S. SINGH, MANAGER (BUSINESS BANKING), NOIDA, UTTAR PRADESH
OPERATION RED SPIDER, PART- 1

AXIS BANK, CASE 7: V. JUNEJA, MANAGER (OPERATIONS/INVESTMENTS); S. SINGH, MANAGER (BUSINESS BANKING), NOIDA, UTTAR PRADESH

Cobrapost |
July 26, 2011

“Ek banda ITR panch lakh dikha raha hota hai, wo saal mein kum se kum panch crore kama raha hota hai …kahan jana hai paisa saara (A fellow who files an ITR of 5 lakh doesn’t earn less than 5 crore a year… where will all this money go)?” – S. Singh


“Ek banda ITR panch lakh dikha raha hota hai, wo saal mein kum se kum panch crore kama raha hota hai …kahan jana hai paisa saara (A fellow who files an ITR of 5 lakh doesn’t earn less than 5 crore a year… where will all this money go)?” – S. Singh

After the lady banker at the desk at this branch of Axis Bank somewhere in Noida in Uttar Pradesh has hung up her phone, the Cobrapost journalist announces the purpose of his visit without preliminaries: A minister wants to invest Rs. 60–70 lakh in cash in some long-term plan. It has to be done in three names: the frontman, the reporter himself, his wife and the politician’s wife. We are related by marriage. More money, around Rs. 5–7 crore, is expected in March. All investments have to be done in cash.

Manager V. Juneja is quick to ask: “Sir, white money hoga na mutlab PAN card number wagaireh hoga ya direct aapko cash se karna hai investment (Sir, will that be done in white. I mean there will be PAN card, etc. or you will be making the investment direct in cash).”

We have all the money in cash, says the reporter. Juneja suggest to open an account and put in the money there to facilitate investment. But won’t it be problematic for us if we do that following all procedures, wonders our reporter.

Understanding our dilemma, Juneja says: “Wo agar aapko nahin income tax mein show karna hai to humein wo sochna padega ki cash mein investment karwa sakte hain ki nahin … aap mujhe apna naam aur number de dijiye kyonki amount bada hai toh mujhe bhi discuss karna padega ki cash mein agar hum kuch kar bhi sakte hain ki nahin (If you don’t want to show in income tax then I will have to think whether we can do investment in cash or not. You tell me your name and number … Since the amount is huge … I will have to discuss it if we can do something in cash or not).”

It is apparent that black money is acceptable. But how it has to be sequestered has to be decided with due diligence.

After exchanging phone numbers, our reporter tells Juneja to advise to commit investment only when they have already done such cases. In the same breath, the reporter gives Juneja a wish list: The minister is expecting Rs. 5–7 crore in cash for which a locker will be needed; her bank will have to count currency notes with a counting machine; some of the crores have to be transferred to England where the minister’s wife often goes. Our reporter asks her to get back on his wish list. Juneja seeks time till evening. Before leaving the branch, our reporter swears Juneja to secrecy given the involvement of a well-known minister and asks her get back to him immediately as soon as she has sought advice from her branch head as the cash is lying at his home giving him jitters.

Thankfully, our reporter doesn’t have to wait much, and he is invited back to the branch by the lady banker sometime later the same day.

The lure of lucre is heady indeed!

Upon his arrival at her desk, Juneja calls another banker on phone to check if he is present, as the branch manager is not available, to discuss the matter. As they again begin discussing about the investment, the reporter reiterates that the most important for his master, the minister, is whatever they do should be “safe.” Juneja assures him that they will guide him as best as possible to help take an informed decision. A meeting is also agreed upon in the evening to take the deal forward in the presence of the minister.

Some minutes later another banker, S. Singh, Manger (Business Banking), joins them and they all go to a separate room. Taking a seat opposite his client, Singh comes straight to the point: “Investment to karyange nahin main abhi jo hai routing fund ka (We will not get into investment right now but talk about routing of fund).”

Yes, you got it right, routing cash into the system is the primary objective, tells the reporter. There is no dearth of money to be invested. The important thing is the investment should be safe. So should be the method of routing of cash into investment.

Asking if the client has any personal account with the bank or if they have companies, Singh proposes: “Account hi khol lete hain pehle… individual current account khol denge…usmein aap fund apna route kijiyega…wahan se DD bana ke usko daal denge (Let us open an account first … we will open an individual current account in which you route your fund. We will make DD from that account and invest it).” What Singh is saying is that cash would be routed into investment after making DD from this account.

Won’t there be any problem in future from Income Tax Department, say, 4–5 years later, asks the reporter, after we invested the way you suggest.

Reassuring our reporter on this count, Singh goes on to explain how he is going to make it happen: “Nahin usmein koi dikkat nahin hai… toh aap initial payment cheque mat dena… initial payment se track hote hain account…jaise maan lijiye mera ek account chal raha hai Axis Bank mein aur maine kya kiya apna ek cheque kaat ke de diya doosre ICICI Bank mein account kholne ke liye … toh ab kya hoga jab meri scrutiny hogi to wo sara transaction check karte hain wo dekhte hain ki ye particular paisa Sumit Singh ke account se nikla Sumit Singh se gaya kahan gaya. So they can track ki Axis main account chal raha tha doosra ICICIC mein khula hua hai… toh track ho jati hai (No, there would be no problem in it. So, don’t give initial payment by cheque. Accounts get tracked with initial payment. Suppose, I have an account with Axis Bank and what I do I issue a cheque to open another account with ICICI Bank. Now, what will happen when my scrutiny is done, all transactions are checked. They will see that a particular amount got debited from Sumit Singh’s account. Where has it gone from Sumit’s account? So, they can track it that one account is running with Axis Bank and the second has been opened with ICICI Bank. This way it gets tracked).”

Singh has a valid point and we would never like our transactions to be tracked!

Singh continues: “Aapse cheque nahin lenge… bilkul aapse cash lenge account khul jayega aapka…ab aapki maan lijiye char account chal rahe hain…jo aapne income tax mein show kiye hue hain…unko aap proper maintain rakho…jaise karte ho…kal ko agar income tax aapki scrutiny karta hai … toh wo char hi account dekhenge…ye account jo aapka chal raha hai ye show nahin hoga kahin (We will not take cheque from you. We will take cash only. Your account will be opened. Now suppose, you have four running accounts which you have shown in your income tax returns … proper maintain those as you do. If tomorrow, the Income Tax brings you under scrutiny, then they will only see those four accounts. This account will not show).”

So, here lies the trick to hoodwink the Income Tax authorities. Are they listening?

So, what you suggest is best, asks our reporter?

Replies Singh: “Aapka best ho jayega tarika (This will be the best way for you).”

Please tell all this to our CA, begs our reporter.

To reassure what he has suggested if fool proof, Singh goes on to claim: “Aise kaafi accounts hote hain jo builders wagaireh hote hain na humare paas… jinke paas cash zyada rehta hai. Usmein kya hota hai maan lo unko payment mil raha hai… fifty per cent cash hota hai fifty per cent number ek mein hota hai…number ek wala to TDS kat ke aata hai… usme inquiry nahin hoti hai kyunki uska return file karna hai…lekin cash ko kahan le ke jayein…to usually yehi method sab log follow karte hain (There are many accounts of builders with us who have more cash. In such cases, suppose they are getting payment …it’s 50 per cent cash and 50 per cent in number one. They get the number one after TDS. There is no inquiry into such payment because it is shown in returns. But where should one take the cash to? So, usually most of them follow this method only).”

Singh continues to count the benefits of investing black money this way: “Usmein fayda ye hai aapka investment jo humara long term hai… apne daal diya ek toh jo aapka money jo black wala tha wo white ho gaya…tax bacha aapka… wo return ho gaya jo aapne dus bees per cent tax dena pada… plus jab aap paanch–dus saal baad withdrawal loge toh uspe again dus–pandrah per cent ka return mil jayega (The benefit in that is when you make your long-term investment, your black money converts into white, then you save on tax … as 10–20 per cent tax, whatever it is, you have paid that returns to you, plus when you will go for withdrawal after 10–15 years, you get a return of 10–15 per cent).”

He advises not to seek tax rebate as it will be tracked.

The discussion moves on to various investment plans and how best they can help clean our money while ensuring good returns.

What if we receive a cheque and remit it in Axis Bank then won’t it be tracked, asks our reporter? Telling that such an eventuality would arise only when you file ITR and show the receipt in it, Singh reassures: “Aapka account khula hi hai isi purpose ke liye… aapka number ek ka paisa jo bhi hai… jo aap apna show karte ho…usko aap jahan account chal rahe hain wahan chalao…khol liya ek account number doh … separate account (Your account is being opened for this purpose only. Whatever white money you have, which you show, keep it there wherever your other accounts are running. Open account for number two … separate account).”

Wow! Nothing could be more savoury than this!

So, how many such accounts can we open with Axis Bank, for our number two money, asks the reporter?

Pat comes the reply: “Sir aap tino ke naam pe khol lijiye (Sir, you can open in the names of all three).”

Tell me if we can invest lump sum Rs. 5–7 crore the minister is expecting in cash in March first week, asks the reporter, to make it white? Singh suggests: “Investment hi hai better tarika waise ek investment daal do … usmein aapka account ek na … usmein hum daal denge investment toh ek toh aapko thoda sa blockage rahegi aapke fund ki (Investment is the only method … put in an investment …there is an account … in which we will put in an investment but then your fund will remain in blockage).”

Does Singh mean his bank does such big investments through dummy accounts when he says “usmein aapka account ek na).” Well, we will not insinuate.

But would it be advisable to put in so much money?

Singh replies to correct himself: “Nahin sir … ek saath nahin karna thoda shifts mein kar dena pachas lakh… chalis lakh (No sir, don’t do it at once. Do it in shifts… like 50 lakh… 40 lakh).”

Are you joking? I think we will have trouble at hand, the reporter challenges their nonchalance, if we invest so much of cash.

Juneja chips in: “Nahin sir toh fir aap doosri jagah daaloge toh aapne saare account show kar rakhe hain tab aapke liye aur problem hogi (No Sir, if you put it in at other places, you have already shown all your accounts, then you will have more problem).”

So if you open an account for me and I deposit Rs. 1 core in it, then you say I will have no problem, asks the reporter again?

Singh replies with the same nonchalance: “Humein kya? Aap dus crore sau crore jama karo…hum to khole hi bank jama karne ke liye (What problem we can have? You deposit 10 crore, 100 crore we have opened the bank only to get the deposits).”

But then won’t we have to show PAN, argues our reporter?

Singh has a way out: “Usmein PAN number … ho toh gaya na Form 60 ke base pe we can deposit the cash. Form 60 hota hai usmein declaration hoti hai ki mere paas PAN card nahin hai theek hai to usmein Form 60 hota hai wo hum le lete hain ki is bande ke paas PAN card nahin hai aur hamne iska account khola hua hai deposit kar raha hai fund uske liye hota hai (PAN number in that … it is done then. On the basis of Form 60 we can deposit the cash. There is a declaration in Form 60 that I don’t have a PAN card…Ok. We take a Form 60 from the customer saying that he does not have a PAN card and we have opened an account for him. He is depositing funds in it. That is for this purpose).” This is enlightenment of a different kind!
Won’t then the Income Tax Department trouble us a couple of years down the line, asks the reporter, if we invested this way to make our money white?

Singh is ready with an answer: “Income Tax mein detail hi kahan pahunchegi jo notice aayega? Hum toh bhejte nahin…PAN card walon ka automatically track hota hai (How will you get notice when the details are not sent to Income Tax Department? We don’t send. Those with PAN card are automatically tracked).”

Hope, what the official claims is true. We are gone otherwise!

Inviting both to an evening meeting to take it forward, our reporter again reiterates the importance of safety of investment and secrecy. Have you ever done such investments for another political leaders, asks the reporter?

Promising to never disclose the affair, as they believe in keeping trust, Singh claims: “Builders ke liye toh bahut kari hai… builders ho gaye… brokers hote hai na…ek banda ITR panch lakh dikha raha hota hai wo saaal mein kum se kum panch crore kama raha hota hai …kahan jana hai paisa saara (We have done it several times for builders. There are builder, then there are brokers. A fellow who files an ITR of 5 lakh doesn’t earn less than 5 crore a year… where will all this money go)?”

We know now the answer: in banks like Axis Bank.

Before wrapping up quite fruitful a meeting like this, our reporter again reiterates the safety and confidentiality of both the investment and its purpose: to convert black money into white. Finally, both parties agree to meet again in the evening to take it forward


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