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Mumbai: The Economic Offences Wing (EOW) of the Mumbai police on Friday arrested a 59-year-old trustee of Shri Arvindo Institute of Applied Scientific Research Trust for allegedly causing a loss of ₹58.89 crore to the government of India through a donation racket. The arrested trustee, Umesh Nagda, who trades in spices, is based in Andheri East. He was produced before a court on Saturday and remanded to police custody up to May 31. Police said that the mastermind of the racket is still at large.
Shri Arvindo Institute of Applied Scientific Research Trust had been earlier registered under section 35(1)(ii) of the I-T Act as a research association having as its sole object to undertake scientific research or to run a university, college, or other institution for carrying out scientific research.
In March 2018, the Bhoiwada police had booked trustee Umesh Nagda and others after the Income Tax (I-T) department found the trust registration had expired in 2006 and it was no longer eligible to receive donations. However, it continued to receive donations from the public by allegedly showing bogus certificates in the name of undertaking scientific research. The case has been transferred to EOW.
The Income-Tax department then wrote to the Ministry of Science and Technology’s Department of Scientific Research in New Delhi.
“The Department of Scientific Research responded that Arvindo Institute of Applied Scientific Research Trust doesn’t exist and the certificate the trust is showing to get donations was bogus, as the department had not issued such certificates,” the complainant stated in the complaint.
After the trust was found to be bogus, I-T officials carried out a thorough inquiry. Officers found that Nagda and others had between 2013 and 2019 accepted ₹194.67 crore as donations from various organisations in seven bank accounts.
Further, in order to avail of tax relaxation, they submitted trust’s bogus certificate and caused a revenue loss of ₹58.59 crore to the government of India, the complainant stated.
The donation received in the trust’s account was later diverted to six bank accounts of various firms in Gujarat. But when officers tried to track the fund flow, no one could be found at the offices of those firms. Police are yet to find out as to whom the trust money was being diverted, said an EOW officer. The probe so far has revealed that one Deepak Chimanlal Shah used to take blank signed cheques from Nagda, the signing authority for the trust, and would pay a monthly ₹20,000 to Nagda. Nagda in his statement to the Income Tax had said that Shah is the mastermind of the racket, the officer added.
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