Government Will Disclose Name To Court

Govt to tell SC names of Swiss bank account holders Hindustan Times  New Delhi, October 22, 2014

The government will likely disclose to the Supreme Court next week names of people against whom strong evidence exists of stashing away black money in Swiss banks, a major step in its crackdown on India's parallel economy.

Top government sources told HT that a supplementary affidavit is likely to be filed in in the apex court next Monday detailing plans to submit the list of names in a sealed envelope. The court is due to continue hearings on a petition on black money the following day.

The move flows from a detailed discussion between Prime Minister Narendra Modi, finance minister Arun Jaitley and BJP president Amit Shah.  The first list will contain 136 of the nearly 800 names provided by European governments.

Last week, the government had told the apex court that it could not disclose the names of those who have deposited money in banks abroad as it this would jeopardise tax agreements with nations providing those names to India.

There were murmurs of protest within the BJP that not disclosing names would hurt the party’s image after it had made bringing back black money a key issue in a general election that it won by a landslide. The Centre’s stand also drew a strong response from the Congress, which accused it of hypocrisy.

The sources clarified to HT that tax treaties with Switzerland and other nations allow for naming those on the list to a court if the matter was under investigation and if strong evidence was established.

While there are no official estimates, Global Financial Integrity (GFI), a Washington based 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 and2008.

The government has commissioned three  Delhi-based think-tanks—the National Council for Applied Economic Research (NCAER), National Institute of Public Finance and Policy (NIPFP), and National Institute of Financial Management (NIFM) to bring out an estimate of India’s black economy.

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. Black money arises mainly from incomes not disclosed to the government usually to avoid taxation and sometimes because of its criminal links.

On the orders of the Supreme Court, which is hearing the petition filed by lawyer Ram Jethmalani, the Modi-led NDA government had set up a Special Investigation Team (SIT) in May handing out a sweeping mandate to the panel to crack down on India’s bustling black economy.

The SC's directions were to investigate individuals whose names were disclosed by Germany for having accounts in LGT Bank in Liechtenstein. In addition, the French government last year that made available list of 782 Indian citizens who allegedly hold HSBC accounts in Geneva.

Last week Jaitley had said Switzerland has agreed to share information related to HSBC and Liechestein lists of account holders, provided there is independent evidence collected by Indian authorities.

Indians’ money in Swiss banks jumped 40% in 2013 to nearly two billion Swiss Francs CHF (nearly Rs. 14,000 crore) from 1.34 billion CHF in 2012 (about Rs. 9514 crore), according Swiss National Bank's latest data.