Cash-for-seat scam detected in K'taka medical colleges

New Delhi: The Income Tax Department has detected an alleged cash-for-seat scam running in some Karnataka-based medical colleges, as the CBDT said over Rs 400 crore blackmoney has been generated in the name of capitation fee by these institutions. A statement issued by the Central Board of Direct Taxes said these alleged irregularities were found after nine major trusts, registered in Bengaluru and Mangaluru, running educational institutes, including medical colleges were raided on Wednesday.

"Searches were conducted at 56 different locations across Karnataka and Kerala," the CBDT, which frames policy for the tax department, said.

"So far, the evidence gathered indicates that Rs 402.78 crore has been accepted as illegal capitation fee by manipulating the online admission process and the same has not been disclosed to the Income Tax Department," it said. It said cash amount of Rs 15.09 crore has been seized and gold jewellery worth Rs 30 crore (weighing 81 kg), 50 carat diamonds and 40 kg of silver articles have been found from the residential premises of the trustees and are prime facie, unexplained.

"Evidence of undisclosed foreign assets of Rs 2.39 crore in Ghana has also been found apart from evidence of huge investments in 35 luxury cars in benami names," the CBDT said. Describing the alleged modus operandi, the CBDT said it was found that the transparent selection process to medical colleges through the National Eligibility cum Entrance Test (NEET) has been "subverted" by trustees and key persons running these institutions in collusion with agents/brokers and some students who got high ranks in the NEET examination.

"The first stage of malpractice is that some high-ranking students in the NEET examination take admission to MBBS courses through state counselling (who have no intention to join the said colleges as they have secured admissions or likely to get admission elsewhere). Thereby blocking seats in the medical stream in a medical college during the Karnataka Examinations Authority (KEA) counselling process, in connivance with agents, middlemen, converters (who provide service of converting the regular seats to management seats)." it said.

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