Karnataka: Over Rs 100 crore Cash Seized As IT Department Swoops Down On Contractors And Realtors Closely Linked To Ruling Congress

The Income Tax (IT) Department sleuths on Saturday (Oct 14) seized over Rs 45 crore in cash from the residence of Santosh Krishnappa, a real estate businessman in Bengaluru. 

Over 15 officers conducted raids at the residence of Krishnappa in Bengaluru's Rajajinagar,

According to local media reports, Krishnappa disclosed that the cash seized belonged to former MLC and Congress leader BEML Kantharaju. 

A former JD-S member from the Vokkaliga community, Kantharaju switched allegiance to Congress and was fielded as the party candidate from the Turuvekere assembly constituency in Tumkur district. Kantharaju is known to be a close supporter of Deputy Chief Minister D K Shivakumar.

Kantharaju, however refused the allegations.

"Builder Santosh is not related to me. I don't have any siblings. So, there is no possibility of interrogating my brothers. I have not received any notice regarding the Income Tax raid either," Kantharaju claimed.

Officials of the income tax launched a massive crackdown between October 12 and 15 across 55 premises in Karnataka, Telangana, Andhra Pradesh and Delhi linked to prominent civil contractors and real estate players.

"The search has resulted in seizure of unaccounted cash of approximately Rs 94 crore and gold and diamond jewellery worth over Rs.8 crore, aggregating to more than Rs 102 crore. Further, about 30 luxury wrist watches of foreign make were unearthed from the premises of a private salaried employee not engaged in the business of wrist watches," the I-T department said in an official statement on Monday.

On Friday (Oct 13), IT officials raided multiple properties linked to Ambikapathy, an influential BBMP contractor with close links to the ruling Congress party. They reportedly seized Rs 42 crores at one of his residences.

Ambikapathy, an office-bearer of multiple contractors' associations in Karnataka, was at the forefront of the "40% commission" campaign against the previous BJP regime.

Ambikapathy also served as the vice president of the Karnataka State Contractors Association headed by D. Kempanna, another prominent contractor known to have close links to the Congress party. Kempanna thrust himself into the limelight by writing a letter to the Prime Minister saying that the state government ministers have demanded a 40 per cent commission in contractual works.

The opposition BJP and JDS have alleged that the cash seized during the raids is a part of the kickbacks collected by the Congress party for the release of Rs 650 crore as payments to civil contractors for works done for the BBMP during the previous BJP regime.

"The Rs 42 crore found with a contractor is the commission for the release of Rs 650 crore of payments to contractors. Karnataka Chief Minister Siddaramaiah and Deputy CM D K Shivakumar should take moral responsibility and quit. There should be a detailed probe into the funds." BJP MLC and spokesperson N Ravikumar alleged.

Former Chief Minister and JD(S) leader HD Kumaraswamy suggested that the cash seized at Ambikapathy's residence may be connected to funding requirements for Congress in upcoming state elections, especially in Telangana. He also referenced the release of funds by BBMP to contractors and the subsequent IT raid.

"The cash was found following the release of Rs 650 crore of payments to a few contractors. It seems to suggest that the money is illegal. Who are the people behind this and what is the percentage of kickbacks?" Kumaraswamy alleged.

"The information is that the carton boxes with the money were to be transported to Telangana," he further alleged.

Kumaraswamy also claimed that cash recovered in the first phase of the I-T searches was part of the "SST tax" (in reference to allegations that have emerged that DKS brothers have been on a collection spree ) and the Rs 52 crore cash found in the second phase was part of the "YST tax" (reference to Siddaramaiah and his son Yathindra).

Deputy chief minister DK Shivakumar refuted allegations and claimed that IT raids were 'politically motivated'.

Karnataka Chief Minister Siddaramaiah also dismissed BJP's allegations as "politically motivated and baseless". The I-T department has done its job. It is not right to connect it politically just because money was found at someone's house," he said.