Prime Minister Narendra Modi thumped his “56-inch chest” during the campaign in 2014 general elections in India to declare that he would bring back the black money stashed abroad (kala dhan) if he were the prime minister. Now his government has filed an affidavit in Supreme Court seeking the same thing dismissed.
The ground is that the government has already brought to tax Rs. 8,186 crore from “unreported foreign banks” and that a multi-agency group (MAG) for the purpose has already been set up.
In a rather curious affidavit filed in the top court by the Department of Economic Affairs of the Union Finance Ministry, the Central government stated that “an undisclosed income of Rs. 8,186 crore (including protective assessment of Rs. 1,485 crore) has been brought to tax, on account of deposits made in unreported foreign bank accounts”. Hence, the PIL seeking court-monitored probe against Indians whose names have figured in the Panama Papers for allegedly holding bank accounts in foreign nations be dismissed. Further, the apex court has already constituted a special investigation team (SIT) in the matter.
The affidavit stated that the MAG has been constituted comprising officials of CBDT, RBI, Financial Intelligence Unit and ED and it would ensure “speedy and coordinated” investigation.
The affidavit, sworn by one Manu J Vettickan, Deputy Director, stated about Rs. 1,282 crore has been levied as the tax in 159 cases pertaining to concealment of tax due to the government.
“So far, 164 prosecution complaints have been filed in 75 cases. The apex court-appointed SIT on black money has been kept updated on the progress in these investigations,” according to the affidavit.
In response to the progress made so far in the probe into the Panama Papers, the government told the Supreme Court that “till date, five reports have been submitted by the MAG to the government. The SIT on black money is being regularly updated on such issues.”
It also stated that the competent authority from Switzerland has not shared any information with India on various grounds including Treaty limitations and their domestic legal barriers.
The replying affidavit has come in response to a Supreme Court direction to the government to apprise of the steps taken to implement the recommendations of the Special Investigation Team (SIT) on retrieving the black money and to curb the menace of unaccounted wealth.
Allegedly about Rs. 3 lakh crore of this money have been doing the rounds in various stock markets in India. Participatory Notes, known as P-Notes in the stock market parlance, for investing this amount, are already there in the stock market in India.
P-Notes are negotiable instruments, like say, cheques. But the difference is that P-Notes could be issued by registered foreign institutional investors to overseas investors, who invest in the Indian stock markets without registering themselves with the Indian market regulator Security and Exchange Bureau of India (SEBI).