Sleuths of the Directorate of Vigilance and Anti-Corruption (DVAC) under the Tamil Nadu government began conducting searches at the residence of senior IAS officer S Malarvizhi on Tuesday, 6 June, based on an FIR filed against her.
According to the FIR, she is accused of being involved in a scam in the procurement of receipt books for the village panchayats while she was the district collector of Dharmapuri.
She allegedly raked in close to ₹1.32 crore by perpetrating the scam.
The DVAC sleuths were conducting simultaneous searches in nine other places, including in Chennai, Dharmapuri, Pudhukottai, and Villupuram, related to the scam.
On Monday, the DVAC registered a case based on the available evidence against the IAS officer and two others — H Thageer Hussain of Crescent Traders and Veeraiah Palanivelu of Naga Traders.
The FIR was registered under Sections 120-B of the IPC, and Sections 7(c) and 13(2), read with Section 13 (1) (a) of the Prevention of Corruption Act of 1988, as amended in 2018.
Based on the FIR, 10 teams of nearly 40 officials are conducting the raids.
According to the FIR, in anticipation of the release of state Finance Commission grants to Panchayats in the Dharmapuri district, Malarvizhi issued orders to all Block Development Officers (BDOs), insisting that they purchase tax receipts for Panchayats from private institutions.
In the capacity of the inspector of Panchayats, the district collector Malarvizhi procured the receipt books from private firms without following any mandatory provisions and supplied them to the Panchayats, it added.
The amount was settled to Hussain and Palanivelu by Malarvizhi directly from the general funds allocated to Panchayat Unions for the month of January, February, and March 2020 under the state Finance Commission. Then, it was ordered to be adjusted from the funds allotted to the panchayats.
Accordingly, a total of 1,25,500 receipt books — pertaining to house tax, professional tax, water tax, and miscellaneous tax — were supplied to 251 Panchayats at the rate of ₹135 each, whereas the Government Co-op Printing Press charges ₹35-40 for printing such a book.
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According to the DVAC, no work order was issued by the district collector for the procurement of receipts. Also, the books were supplied by the concerned BDOs to their respective Panchayats under acknowledgement from the Panchayat secretaries.
“Malarvizhi purchased numerous books when no such requirement was placed by the Panchayats. It is further regretted to see that the quantity of the books purchased and delivered to all Village Panchayats can be used for another 15 years, when the quality of the books will automatically deteriorate after five years,” the FIR stated.
The DVAC also found that one Meenatchi Traders from Madurai supplied all the books, and that they had not come from the firms of Hussain and Palanivelu, to whom the money was paid.
Yet, the tax invoices given by Hussain and Palanivelu in the name of their firms were enclosed in the voucher files.
Interestingly, the tax invoice given in the name Meenatchi Traders was found to be similar and all were apparently prepared on the same computer. Therefore, the genuineness of all the tax invoices was under question.
The DVAC also alleged that no rule permits the district collector to enter into these types of transactions with private firms, and that an open tender system should have been followed for this transaction, as it exceeded a value of ₹5,000.
The tender should have been published across the state as this transaction comes between the financial limit of ₹25 lakh to ₹3 crore.
A history of irregularities
Hussain and Palanivelu “have been involved in other cases,” said the FIR.
They allegedly swindled a sum of ₹29.94 lakh in connivance with Rural Development Department officials without actually supplying bleaching powder to the Pennagaram Union during the year 2018-19, and appear to have been involved in irregularities in the supply of submersible motors to borewells of Pennagaram Union.
“Therefore, the genuineness of their alleged firms is in question and they have to be subjected to a deeper probe to ascertain their multifarious business activities involved in the district,” the FIR stated.
Malarvizhi, being a public servant, performed her official functions improperly or dishonestly in anticipation of or in consequences of accepting undue advantages from Hussain and Palinivelu, alleged the FIR.
“She, being entrusted with the funds of the government, dishonestly/fraudulently misappropriated a sum of ₹1,31,77,500 and converted for her own use with their active connivance,” it added.