On April 6, the Income Tax Department had frozen an account held by the CPM in the Thrissur branch of Bank of India. The account had Rs 4.8 crore. It was said that the CPM had not disclosed the account, and, thus, the transactions made through the account were illegal.
On Friday, CPM state secretary M V Govindan said it was an error committed by Bank of India that led to the freezing of the account. He said the IT officials used a wrongly entered PAN number to act against the CPM. Govindan said that the CPM had just one PAN number: AAATC0400A. He said this PAN number was used for all CPM accounts, including for the accounts of all district committees and the state committee.
The Thrissur branch of Bank of India entered the PAN number wrongly. What is AAATC0400A became AAAJC0400A. "The fourth letter T was replaced with J," Govindan said. Bank of India acknowledged the mistake.
The CPM state secretary distributed copies of two letters, one a letter (dated April 11) written by the CPM Thrissur District Committee to Bank of India saying it had made a mistake, and the other a reply by the bank (dated April 18) admitting to the error.
Govindan said the CPM's Thrissur account remained frozen even after these facts were laid down before the IT officials. "Who said they are after facts? The IT officials were just functioning at the command of the BJP to make things difficult for the CPM during election time," Govindan said.
The CPM Thrissur district secretary, M M Varghese, who had been subjected to prolonged interrogation by the IT officials, had also told reporters about the bank's PAN number error. Varghese had said this on May 1.
Govindan said that the media had painted the interrogation of Varghese by the IT as a kind of ambush set up by the central agency. "The district secretary and the office secretary went to the Thrissur branch of the bank following summons by the IT department. There was money with them because the IT had asked them to withdraw the money," Govindan said.
He also distributed a copy of the summons served by the IT deputy director to the CPM's Thrissur District office on April 30 to substantiate his argument.
"Once the CPM District Committee members reached the bank, the IT officials present there said it was illegal to withdraw the money from the account and said the account would be temporarily frozen. They even gave a verbal directive against using the money already withdrawn," Govindan said.
The CPM state secretary said the party was convinced that it was an illegal directive and still decided not to utilise the money. "How can they issue such a directive," Govindan said. "The IT has no authority to prohibit a legal transaction and we knew that we were under no legal obligation to obey the orders. Yet, if we kept the money unutilised it was only to avoid a media brouhaha over the issue in the middle of the election," Govindan said.