The Centre on Friday submitted before the Supreme Court that all the information on black money received from foreign countries, with which India has double taxation avoidance agreement, cannot be disclosed.
In its application, the Centre said that the foreign countries have objected to disclosing such information and if such details are revealed then no other country would sign such an agreement with India.
Appearing before a bench headed by Chief Justice HL Dattu, attorney general Mukul Rohatgi mentioned the issue and pleaded for an urgent hearing.
Viewed as going hand in hand with corruption, “black money” has been at the top of the agenda of widespread public protests over the last couple of years.
Senior advocate Ram Jethmalani strongly objected to the stand taken by the Centre and said that matter be not heard.
"Matter should not be entertained even for a day. Such application should have been made by the culprits and not by the government," Jethmalani said, adding that Centre is trying to protect the people who have stashed black money in foreign banks.
Jethmalani said that he has written a letter to Prime Minister Narendra Modi on this issue and his response is awaited.
To meet a deadline set by the Supreme Court for the previous government, Prime Minister Narendra Modi’s cabinet — on the new government’s first day in office in May — set up a high-powered Special Investigation Team (SIT) to look into the issue of black money and slush funds.
The government has given the SIT, headed by retired Supreme Court judge MB Shah, a sweeping mandate to crack down on India’s infamous and bustling parallel economy.
Black money arises mainly from incomes not disclosed to the government usually to avoid taxation and sometimes because of its criminal links.
The SC had directed the government to constitute a SIT to investigate individuals whose names were disclosed by Germany for having accounts in LGT Bank in Liechtenstein — a European principality known for its banking secrecy laws.
The government has given the SIT a wider mandate to investigate the operations of Indian individuals and “entities” whose money is found stashed in foreign banks. It will file periodic status reports to the Supreme Court.
The income tax department has given to the Enforcement Directorate (ED) — the agency that tracks overseas money laundering deals — names of 17 individuals who had held accounts in Liechtenstein’s LGT Bank.
“The ED has sought more information, but the tax department has said that there were specific clauses in the tax treaties with these countries that prevent sharing of information,” said an official who did not wish to be identified.
The official said that in the last two years, the income tax department had collected 7,704 “items of information containing details of payments received by Indian citizens in various countries, besides information from LGT Bank accounts.”
In addition, in the past one year the government has made more than 175 requests to countries with which India has inked tax treaties.
“This information is in various stages of processing and investigation,” the official said.
There are no official estimates of India's black economy
The Global Financial Integrity (GFI), a Washington-ased think-tank, has estimated that Indians had salted away $462 billion (about Rs. 28 lakh crore in current exchange rates) in overseas tax havens between 1948-2008.
The government is expected to reveal a new estimate, the first since 1985, of India’s unaccounted “black money”, most of it stashed abroad, and follow it up with a plan to hold it to account.
It has commissioned the National Council for Applied Economic Research (NCAER), the National Institute of Public Finance and Policy (NIPFP), and the National Institute of Financial Management (NIFM) to bring out an estimate of India’s black economy.
“Given the complexities inherent in quantification of unaccounted income and wealth both inside and outside the country, it will take some more time for the finalisation of these reports,” another official said.
The Bharatiya Janata Party (BJP), in a 2011 report, had estimated India’s black economy to be worth around $500 billion and $1.4 trillion (between Rs. 30 lakh crore and Rs. 84 lakh crore).
Between 2009-10 and 2012-13, the income tax department detected undisclosed income of more than Rs. 65,000 crore through specific “search and seizure” operations and “surveys”.
No comments:
Post a Comment