A multi-agency group will monitor information flow on wealth hoarded by Indians in tax havens, the government announced on Monday and vowed to punish violators after an expose named politicians, businessmen and filmstars with allegedly dubious offshore financial dealings.
An international coalition of media houses that included The Indian Express published what it said was an extensive investigation into offshore financial dealings of the rich and famous, based on 11.5 million documents provided by an anonymous source.
Dubbed the Panama Papers and sourced from a Panamanian law firm Mossack Fonseca , the list has at least 500 Indians including Bollywood superstar Amitabh Bachchan and his daughter-in-law Aishwarya Rai who allegedly used the law firm to set up offshore entities in tax havens across the world.
Union finance minister Arun Jaitley said the group has been set up on the advice of Prime Minister Narendra Modi and includes officials from Central Board of Direct Taxes (CBDT), Reserve Bank of India (RBI), Financial Intelligence Unit (FIU) and Foreign Tax and Tax Research (FT&TR).
“The multi-agency group… will continuously monitor these (accounts) and whichever accounts are found to be unlawful, strict action as per existing laws will be taken,” Jaitley said.
The BJP had stormed to power at the Centre in 2014 on a poll plank of bringing back black money parked abroad and punishing the guilty but the opposition accuses the Modi government of failing to keep its promise.
Indian laws mandate individuals who own assets or companies outside the country to inform the Reserve Bank of India (RBI) and Income Tax department.
The finance ministry, which issued a detailed statement on the issue, said steps would be taken “to get maximum information from all sources including from foreign governments to help in the investigation process.”
It added that progress has been made in investigations into accounts of 628 Indians in HSBC, Switzerland, based on information received in 2011 from the French government. 569 persons have been traced, the statement added.
At the annual summit of business body CII, Jaitley came down on those who did not avail a 90-day compliance window offered by the government to declare their unaccounted wealth stashed abroad, saying that they will find “such adventurism extremely costly”.
The Congress rejected the government’s move to form a multi-agency team to probe the Indians in the list, saying Prime Minister Narendra Modi and his government should not shy away from referring this matter to the existing Supreme Court-appointed Special Investigation Team (SIT) on black money.
“The PM’s credibility is at stake with the latest expose. It includes the names of his brand ambassador, his travel companions and industrialist friends,” party chief spokesperson Randeep Singh Surjewala said. “We have no axe to grind against any individual. We never said that all the names in the list should be declared guilty. The law must have its own course,” he said.
Surjewala insisted that the Congress only wanted a time-bound inquiry by the Supreme Court-appointed SIT into the matter.
In the latest expose, the ICIJ also named business tycoons KP Singh of DLF, Sameer Gehlaut of Indiabulls and Vinod Adani of Adani group. Two politicians on the list are Shishir Bajoria from West Bengal and Anurag Kejriwal, the former chief of the Delhi unit of Loksatta Party.
Referring to earlier exposes on illegal financial dealings, the minister said detailed assessment orders have led to the discovery of illegal assets worth around Rs 6,500 crore.
The Supreme Court-appointed SIT engaged in tracing hundreds of crores of black money – funds used in a manner to evade taxes – also promised a probe into the fresh revelations.
SIT chairman MB Shah, a retired Supreme Court justice, too, said the team will “thoroughly investigate” the allegations.
The expose also named 12 heads of countries with direct interest in shell companies set up by Mossack Fonseca. The prominent names include Pakistan Prime Minister Nawaz Sharif and Russian President Vladimir Putin among others.
(With inputs from agencies)