Centre unlikely to give stash info in affidavit
New Delhi, Jan. 29: Despite mounting pressure from the Supreme Court, the Centre is unlikely to reveal any information about any Indian who has stashed black money abroad, in its affidavit to be filed before next Thursday’s crucial hearing. The Centre is expected to focus on measures it has initiated to gather information by signing Double Taxation Avoidance Agreements (DTAA) with various countries and strengthening the monitoring of transfer price system (TPS).
As more than 70 per cent of the world’s black money is stashed in Swiss banks, the government in the affidavit is likely to spell out the formulation of a revised DTAA with Switzerland to make information gathering under TPS about any money transaction abroad easier.
Facing intense pressure form the apex court for revealing the names of “faceless Indians” who have stashed unaccounted money in banks abroad, the Solicitor-General, Mr Gopal Subramaniam, had on January 20 sought time till Monday to detail the steps initiated by the government.
While the government at this stage is not ready to go beyond the DTAA to get information about “black account” holders, it wants to emphasise on reforming the system to keep strict tabs on the TPS.
The decision to put the TPS under rigorous scrutiny was evolved in an understanding reached by G-20 countries for better cooperation on transfer of “ill-gotten” money, particularly that generated through terrorism, drug trafficking, money laundering and smuggling.
As per the understanding, a bank where any currency is exchanged under TPS has to inform the authorities of the country whose currency is exchanged. Even if they are not informed immediately, a tab still could be kept about every money exchange recorded by the bank. Due to tightening of TPS, income-tax and enforcement directorate were able to stop outflow of `34,000 crore from India during 2009-10, Mr Subramaniam informed the apex court during January 20 hearing.
For not going beyond DTAA route, the government is citing India’s commitment to international protocol on “jurisdictional cooperation” between nations as it does not want to “risk blocking” of the information channels from one country in a bid to get it from another through some other means.
The other important aspect the government is likely to deal with, includes setting up of an “independent institution” for monitoring of TPS rather than getting the work done by the I-T department and the Enforcement Directorate.
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