Delhi Police Wednesday unearthed a major scam in the income tax department by arresting four people for fraudulently procuring income tax refund orders totalling Rs.350 million.

The economic offences wing of Delhi Police arrested Harvinder Singh Sahota, 33, Jujhar Singh, 31, Amit Chawla, 29, and Manoj, 37, for procuring income tax refund orders in the name of bogus companies and individuals, a statement said.

Police had received complaints that some people, in connivance with income tax officials, had claimed refunds with bogus certificates and by forging signatures of income tax officers.

Investigation showed 53 bogus income tax refund vouchers were prepared. These were encashed through 43 bank accounts opened at ABN Amro Bank, Corporation Bank, Indian Bank, ICICI Bank, Bank of India, Canara Bank, Syndicate Bank, HDFC Bank and Citibank among others.

The accounts were opened and operated by the accused in the names of 35 non-existent companies.

While scrutinising the certificates, a mobile phone number was found mentioned behind one such document, which was traced to Vinod Sharma, a resident of Vikaspuri. However, no such person was found residing at the address.

Thereafter, all the banks were requested to inform if the number figured in any of their customer references. The ICICI Bank informed the police that one Harvinder Singh Sahota had mentioned the number in his application for a credit card.

It was further intimated that Rs.44,000 was outstanding against his credit card while his office was always found locked. The police tracked Sahota and arrested him Sunday.

Similar scrutiny of such bogus accounts gave the police evidence to proceed against Singh, Manoj and Chawla, who were arrested June 5.

Two types of modus operandi were used by the accused.

They stole tax return forms with the connivance of income tax officials and filled the same by using fake stamps of officers. They then deposited the refund cheques in bogus bank accounts and withdrew the amount.

The other method was to submit tax return forms with bogus certificates and obtain refund vouchers from the income tax department.

"More details of investments and accounts of the accused and their associates are being ascertained while the involvement of bank officials cannot be ruled out," the statement said.