KATHMANDU, June 20: The Commission for the Investigation of Abuse of Authority (CIAA) has issued arrest warrants against Tax Settlement Commission (TSC) chief Lumdhwoj Mahat and member Umesh Dhakal, accusing them of being involved in a multi-billion rupee tax scam.
After recording the statement of Inland Revenue Department chief Chudamani Sharma, the anti-graft body has asked the police to arrest Mahat and Dhakal and hand them over to the CIAA. The arrest warrants against Mahat and Dhakal were issued after they ignored the CIAA's summons and refused to appear before the anti-graft body. Sharma is currently in CIAA custody on the charge of waiving taxes to business firms “in a questionable manner”.
"They were asked to appear before the CIAA but they refused to do so within the deadline. So now we have issued arrest warrants against them," said CIAA Spokesperson Jibraj Koirala, adding, "The police are looking for them."
On June 2, the CIAA had arrested IRD chief Sharma on the charge of being involved in corruption while fixing the tax liabilities of large industrial entities. Sharma was also a member of the then TSC, which whittled down tax liabilities amounting to Rs 30.52 billion to Rs 9.54 billion for purportedly resolving disputed tax cases. The commission was formed by the then finance minister Ram Sharan Mahat.
Commenting on the tax settlements, the Office of the Auditor General in a recent annual report questioned the rationale behind the tax waivers. It said that the settlements were not in cases of disputed tax assessment or in cases under review in court but were only instances of taxpayers simply not paying their tax dues.
Out of 1,726 applications registered at the commission seeking tax waivers in 2071 BS, it whittled down the taxes for 1,069 applications.