Sambalpur: A major financial irregularity involving the alleged embezzlement of government funds has come to light at Excise office in Sambalpur (Northern Division), with authorities estimating the fraud at Rs 3.67 crore. 

Fraud in Excise Department spans nearly three years

The case pertains to unauthorised withdrawals from the Excise Department between November 2022 and October 2025, the Sambalpur Police stated on Friday.

The case was registered at the Ainthapali Police Station on March 9, 2026, under sections 316(5)/3(5) of the Bharatiya Nyaya Sanhita (BNS) related to financial fraud, forgery, and criminal conspiracy that turned to 316(5)/336(3)340(2)/344/3(5)/61(2) of the BNS following an audit report that flagged serious discrepancies. 

Two accused apprehended

Police have arrested two individuals in connection with the case: Sandeep Kumar Pattnaik (38), a suspended Junior Assistant, and Sarat Chandra Behera (65), a retired official. 

Investigators allege that they conspired with retired ASI Achyuta Dehury to siphon off funds.

Modus operandi: Fake sanctions via IFMS portal

According to the police, fraudulent sanction orders were generated through the Integrated Financial Management System (IFMS) portal in the name of the retired official Achyuta Dehury. This enabled unauthorized withdrawals of pension and salary arrears over an extended period.

Officials also found manipulation of records, including bill registers and cash books, alongside suspicious high-value transactions and fund transfers.

Seizures and financial trail

During the investigation, authorities seized:

• Cash worth Rs 23.46 lakh
• Rs 14 lakh deposited in a DDO account
• Rs 30 lakh frozen across bank accounts, including those linked to Achyuta Dehury at UCO Bank

Subsidy abuse and financial misconduct alleged

The accused allegedly abused their official positions to manipulate financial records and divert public funds for personal gain, causing significant losses to the state exchequer.

Investigation ongoing

Police confirmed that further investigation is underway to identify additional links and recover more funds. Authorities are also probing whether more individuals were involved in the fraud network.