Slush money in foreign banks: Supreme Court blasts Govt for secrecy over names

India’s apex court, the Supreme Court on Wednesday chided the government for restricting names of those with black money stashed abroad to Liechtenstein Bank account details disclosed by Germany.

It said the government was wrong in treating black money as a tax issue when it was simple and pure theft of the Indian economy. The court said information from banks in all countries was needed. Criticizing the government for not making public all the names on the list, the apex court said plunder of the nation had taken place.

"It is a pure and simple theft of the national money. We are talking about mind-boggling crime. We are not on the niceties of various treaties," remarked a bench comprising justices B Sudershan Reddy and S S Nijjar, while hearing a petition by former law minister Ramesh Jethmalani and others for retrieving Indian black money stashed in foreign banks.

The remark by the bench came when Solicitor general Gopal Subramanium was explaining various steps taken by the government under the Double Taxation Avoidance Act. The court was unhappy that the government filed an affidavit restricting information relating to the money amounting to Rs 43 crore deposited by 26 persons in Liechtenstein Bank in Germany. "This is all the information you have or you have something more?," the bench asked.

The apex court said since it was dealing with a serious issue in a public interest litigation, it would not hesitate to expand the scope of the petition.

Meanwhile the government said it was ready to share information with the Supreme Court but not make it public since it was in the process of getting more details of foreign accounts of Indians from other countries under the DTAA regime.

A Congress spokesperson said the government was doing everything possible to bring back the black money stashed abroad.

On Tuesday, senior BJP leader L K Advani referring to the issue had said he had great hope that the Supreme Court would act on the issue of black money stashed in foreign banks as people like Ram Jethmalani and K P S Gill have taken up the matter. "Eminent people like Ram Jethmalani, Subash Kashyap and K P S Gill have approached the court on the issue. I have a great hope in the Supreme Court," Advani had said. "An international organisation has said that more than Rs 20 lakh crore of Indian money is stashed is foreign banks (1948-2008) . If it is brought back, it will satisfy infrastructure needs of the country," Advani said .

Swiss nod for treaty to access Indian tax evaders

Meanwhile, a Swiss Parliamentary Committee has given the go-ahead to the revised tax treaty between India and Switzerland that would eventually allow Indian government access to secret Swiss bank accounts of Indian tax evaders.

The amendments to the treaty will now be placed before the Swiss Parliament for final approval. Once the revised treaty gets the approval, Switzerland would provide administrative assistance to India to track cases of tax evasion and tax fraud.

The development comes at a time when the Indian government is under mounting pressure from Opposition parties and the Supreme Court to reveal the names of individuals who have stashed away black money overseas.

Swiss Parliament’s Committee for Economic Affairs and Taxes (CEAT) in a statement on Tuesday said it has received the India-Switzerland double taxation treaty document and forwarded the same to the National Council.

CEAT, which has 25 members, is tasked with examining and drafting advisory opinions on messages, parliamentary initiatives, and reports concerning economic and fiscal issues, according to Swiss Parliament’s official website.

Indian Finance Minister Pranab Mukherjee and Swiss Federal Councillor Micheline Calmy-Rey signed a “protocol” to amend the double taxation agreement (DTA) in the area of taxes on income on August 30, 2010. As per an agreement between the two countries, the information exchange was to have taken effect on January 1, 2011.

However, earlier this month, Switzerland’s Federal Tax Administration department had said the protocol was still to take effect as they were yet to inform each other about extending the necessary approvals. “In Switzerland the Parliament has not agreed upon the protocol yet.

“The exchange of information will be applicable for information that relates to any fiscal year beginning on or after the 1st January 2011, as soon as the protocol has been given effect,” a department spokesperson had said. The amended tax treaty would help the Indian government to seek information about illicit wealth allegedly hidden in Swiss banks by Indians. Earlier, the influential Swiss Bankers Association had said they would not permit “fishing expeditions”, indicating that indiscriminate trawling through bank accounts would not be allowed.

- Asian Tribune -