The Special Court Thursday extended the judicial remand of suspended Director General of Inland Revenue Department (IRD) Chudamani Sharma by seven more days.

This is the third time that the Commission for the Investigation of Abuse of Authority (CIAA) extended the judicial remand of Sharma.

Sharma was arrested by a team of anti-graft constitutional body on the charge of misappropriating billions of rupees by settling taxes in a questionable way as a member of the Tax Settlement Commission (TSC) on June 2.

Earlier on June 5, the court had remanded him to seven days in custody for investigation.

Later on June 9, the judicial remand of Sharma was extended to six more days.

Although the TSC was headed by LD Mahat, the CIAA arrested Sharma first because he was in the position to destroy the evidence.

The three-member TSC, formed by then finance ministry Ram Sharan Mahat in February 2015, had run into controversy after a report of the Office of Auditor General (OAG) in April called into question its decision to grant tax exemption worth Rs21 billion to various enterprises.

The OAG report said that the TSC had exempted the enterprises from tax worth Rs21 billion that was only 68 percent of the total due or outstanding tax amount that needed to be collected. 

Following assessments of taxes that were due or outstanding till the fiscal year 2012-13, according to the report, most of the enterprises were granted tax exemption not because disputes had reached the court but because they were not willing to abide by the instructions of the tax authorities. The TSC had received 1,726 applications seeking settlement of due tax amount worth Rs40.8 billion