The Commission for Investigation of Abuse of Authority (CIAA) has appealed for public support for the arrest of Tax Settlement Commission (TSC) Chairman LD Mahat and member Umesh Dhakal on the charge of granting tax exemption to various organisations.

The accused TSC officials failed to appear before the anti-graft body on June 14 to record their statements despite being served with summons on June 11.

The CIAA notice published on the front page of Thursday’s Gorkhapatra, state-owned Nepali daily, has labelled Mahat and Dhakal as absconders adding that anyone providing information about their whereabouts to the CIAA hotline number-107 or a nearby police station will be awarded accordingly.

“After police failed to arrest them, we have decided to issue a public notice,” said CIAA Spokesperson Jeebraj Koirala. “We are soliciting public support to arrest the absconders. We will announce the exact amount to be paid for anyone giving crucial information  about their whereabouts.”

Mahat and Dhakal were issued with the summons after the arrest of Chudamani Sharma, director general of the Inland Revenue Department (IRD), on June 2 on charge of misappropriating revenue and settling taxes in a dubious way.

During interrogation, Sharma told the anti-graft body found that nearly Rs800 million had been misappropriated. Sharma had been a member of the TSC before being transferred to the IRD.

Court extends Sharma’s remand for third time

The Special Court on Thursday extended the judicial remand of suspended director general of the Inland Revenue Department (IRD) Chudamani Sharma by seven days. This is the third time that the Commission for Investigation of Abuse of Authority (CIAA) has extended Sharma’s judicial remand since his arrest on June 2. 

A team of anti-graft body had arrested Sharma on the charge of misappropriating billions of rupees by settling taxes in a questionable manner as a member of the Tax Settlement Commission. 

Although the TSC was headed by LD Mahat, the CIAA arrested Sharma immediately as he could abuse his position to “destroy 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 various enterprises tax exemption totalling Rs21 billion. 

The OAG report said that the TSC had exempted the enterprises from tax worth Rs21 billion which was 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.