Black money Case
Chief petitioner-in-person: senior advocate Mr Ram Jethmalani
Petition filed in Supreme court in 2011
Government after investigation handed the list of 627 names to SIT.
Appearing before a bench headed by Chief Justice H L Dattu, Rohatgi said almost half the account holders were resident Indians, who could be prosecuted under the Income Tax laws, while the others were NRIs. Some have already admitted that they have accounts and have paid taxes, he said.
Asking the SIT to submit a status report by November-end, the bench said the SIT would proceed in accordance with the law and could also evolve its own procedure with regard to the future course of investigation
Whats makes the spoil
New Delhi: The nation's campaign against black money may not yield good results as sources claimed on Thursday that there are no big names having any links with major political parties or corporate houses in the government's list of 627 foreign account holders that was provided to the Supreme Court yesterday.
The sources also claimed that most of the bank account entries were as old as 2006 and records for which were being kept from 1999 to 2004-05. One of the account entries dated to 1973 and is barred under law from being assessed for tax evasion, they claimed.
The sources added that since most of the account entries were old what if the account holders have withdrawn their accounts - meaning the government would not be able to recover huge money even after freezing their assets in cooperation with Swiss authorities, which is also unlikely.
Meanwhile, the Special Investigation Team (SIT) constituted by the Supreme Court to monitor the probe into untaxed money stashed in foreign bank accounts has invited information from the public.
The panel, which includes retired judges and regulators, will release an email id where anyone can give information, reports say.
Consequences of reveal
On a day when it furnished before the Supreme Court the full list of 627 Indians having accounts in foreign banks, the NDA government put off the signing of a crucial multilateral agreement aimed at facilitating access to financial information on taxpayers abroad.
This has been prompted by the uncertainties on whether India can commit to maintaining the confidentiality of inputs received from foreign countries in accordance with the international pact, specifically in the wake of the apex court’s ruling on Tuesday wherein it sought a full disclosure by the government of illegal accounts held by Indians abroad.
The proposed pact — called Competent Authority Agreement (CAA) — was scheduled to be signed on Wednesday in Berlin at the OECD’s global tax forum and India was to be represented by a joint secretary of the foreign tax division of the tax department, who is the competent authority for the forum.
However, due to the turn of events in the ongoing proceedings on black money in the SC, a junior officer — a director — was sent to attend the two-day event with the mandate to effectively explain that India “is not in a position to sign the agreement currently due to internal issues”, a senior official told The Indian Express. Earlier, the government had filed an affidavit seeking a clarification from the apex court on whether it could enter into treaties that demand commitment to maintaining the confidentiality of information received as per international standards. The absence of such a commitment, the government had argued, would put the country at a disadvantage as it “will not be able to receive information about Indians hiding their money in other countries including offshore financial centres and tax havens through multi-layered entities with non-transparent ownership”.
The Supreme Court's directive on sharing the names of overseas account holders has raised worries about India's commitment to the confidentiality clause in various tax treaties and may impact remittances from the US.
Any move to make the names public without prosecution may hamper signing of the Foreign Account Tax Compliance Act (FATCA) with the US, which contains a confidentiality clause. In the absence of the inter-governmental agreement related to FATCA, all remittances, including payments for exports, would face a 30% withholding tax, said experts.
India and other countries have to sign the inter-governmental agreement by December 31 to ensure that the tax liability does not kick in from January 2015. The UPA government had inked FATCA but a formal signing of the agreement is yet to take place.
