CBI on Tuesday arrested two Income Tax officials including Joint Commissioner of Income Tax S Shivanandan in Odisha while allegedly receiving bribe of Rs five lakh for closing tax penalty proceedings against a person and recovered documents of properties worth crores of rupees.

CBI sources here said the arrest followed a Income Tax search led by Shivanandan and Income Tax Officer Narayan Nayak at the house of one R K Shukla in Dhenkanal, 75 km from state capital Bhubaneshwar, in connection with an alleged IT evasion on October 29, 2013.

Later, Shukla approached CBI claiming that Nayak was allegedly demanding a bribe of Rs five lakh for stopping the tax enquiry against him as part of which search was carried out at his home, they said.

"The complainant alleged that both the accused, in conspiracy with each other, demanded Rs 30 Lakh to close the income tax proceedings initiated against him and his wife," the CBI spokesperson said in a statement.

The official said Shukla expressed his inability to pay such a huge amount and on bargaining, both the accused allegedly agreed to accept Rs 10 lakh as bribe from him in two equal instalments through Nayak to close the income tax proceedings initiated against him.

"First instalment of Rs five lakh was to be delivered to Narayan Nayak, ITO at his office premises. CBI laid a trap and the ITO was arrested while demanding and accepting a bribe of Rs five lakh," it said.

Later, the agency started a search operation at the residence of Nayak which led CBI to the Joint Commissioner's home as some of the documents seized from his house indicated Shaivanandan's alleged involvement.

The CBI immediately searched the premises of Joint Commissioner and claimed to have made recoveries of documents that pointed to amassing huge immovable assets.

Both the officials have been arrested and are being questioned by the CBI sleuths.

The CBI claimed that searches at the residence of Nayak led to recovery of documents relating to the income tax proceedings; documents of four-storeyed well-furnished building at Bomikhal, Bhubaneswar; one double-storey house at Cuttack; one plot in Sapur, Bhubaneswar; one plot at his native near Tirtol, Jagatsinghpur and nine bank accounts in his own name and family members.

The sources said the value of these properties could be several crores of rupees.

"The search at the premises of the Joint Commissioner of Income Tax lead to recovery of certain documents relating to the income tax proceedings; more than a lakh of rupees; a bunch of miscellaneous papers pertaining to bank account details and other expenditures. The documents are being scrutinised for further investigation," the agency claimed.

CBI said a case under IPC section related to criminal conspiracy and relevant provisions of Prevention of Corruption Act has been registered against Nayak and Shivanandan. (PTI/ NewIndianExpress)