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Our Correspondent in Bombay
The Income Tax Department has launched a probe into the chit funds run by Nagorao Ghadge Madhku -- the millionaire municipal sweeper, from whose house police recovered Rs 800,000 in cash last month in Bombay.
According to sources, Nagorao does not have a licence to run a chit fund. He is currently in police custody for possessing wealth disproportionate to his known sources of income. The cash recovered from his house at Makadwala Chawl in Kurla was concealed behind a refrigerator.
Nagaorao told police that he started his chit fund operations in 1982 with an investment of Rs 1,50,000. Almost all his colleagues at the Bombay Municipal Corporation borrowed money from him.
Nagaorao was assisted in his business by his three brothers -- Saybu, Gangaram and Shanker.
Though none of Nagorao's customers were willing to go on record, they said he charged a very high rate of interest. A fifty-year-old sweeper, who borrowed Rs 6,000 from Nagorao in 1982 for his son's education, is still repaying the debt.
Asked, why didn't he report the matter to the police, the sweeper said: "They are all part of the same group. Officers made fun of me whenever I approached them with a complaint against Nagorao."
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