The suspended chief of the Inland Revenue Department, Chudamani Sharma, who is in police custody since his arrest three weeks ago, is likely to be released on bail, multiple sources told said. 

The Commission for Investigation of Abuse of Authority (CIAA) arrested Sharma on the charge of misappropriating revenue and settling taxes in a questionable way on June 2. 

The Special Court had extended Sharma’s judicial remand until Thursday. 

“There are talks about Sharma’s release on Rs 2 billion bail as the judicial remand deadline is expiring on Thursday,” a source told the Post. 

The anti-graft is interrogating Sharma for revenue embezzlement and tax settlement in a dubious way through the Tax Settlement Commission (TSC) as its member. 

The TSC was formed by former finance minister Ram Sharan Mahat in February 2015, and Sharma’s role as its member was called into question after a report of the Office of the Auditor General in April said various enterprises were granted tax exemption to the tune of Rs 21 billion. 

The anti-graft body has been investigating over 1,000 files. Around 125 files are related to tax exemption worth Rs 10 million. 

According to CIAA officials, Sharma’s immediate arrest was necessary for he, in capacity of the director general of the IRD, could have “damaged evidence” against him. 

Sharma, according to the CIAA, had refused to furnish files related to tax exemption despite repeated calls to do so. 

“He had submitted a TSC report but would not provide us with the documents related to tax exemption,” said a CIAA commissioner. 

The CIAA has also issued arrest warrants to TSC Chairman LD Mahat and member Umesh Dhakal after they failed to turn up before the anti-graft body to record their statements.