The Income Tax department on Sunday continued to search the premises linked to Viresh Joshi, the former chief trader and fund manager of Axis Mutual Fund, middlemen and several brokers over allegations of suspected tax evasion.
The I-T raids began on Saturday and Joshi and the brokers were questioned by the department. Apart from front-running allegations, the I-T department also suspects Joshi of tax evasion and siphoning of funds abroad.
Joshi was sacked in May following a whistle-blower complaint alleging front-running and violation of other securities law. He was allegedly linked to irregularities involving crores of rupees including front-running transactions on personal accounts.
The Securities and Exchange Board of India (SEBI)too had earlier claimed to have found transactions indicating Joshi's alleged involved in front running.
Front-running, which is illegal in India, involves purchasing a stock based on advance exclusive information regarding an expected large transaction that will affect its price.
SEBI has categorised front-running as a form of market manipulation and insider trading, and penalised several fund houses and fund managers in the past over this activity.
Joshi, meanwhile, has sued Axis Mutual Fund for wrongful termination and demanded Rs 54 crore in damages. A suit has been filed in Bombay High Court by his law firm Mansukhlal, Hiralal & Co.
He claims the termination to be null and void due to the absence of due cause by AXIS MF. His lawyers also say that Joshi wasn’t given an appropriate opportunity for a hearing.
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