The central government Wednesday submitted to the Supreme Court the names of the 627 people who are holding accounts in foreign banks as revealed to it by the French government.
Attorney General Mukul Rohatgi handed over two sealed envelopes to a bench of Chief Justice H.L. Dattu, Justice Ranjana Prakash Desai and Justice Madan B. Lokur. One envelope had the list of names and the correspondence between the Indian and French government, while the other had the status report of the steps taken by the government.
Rohatgi said that half of these account holders are Indian residents and the other half are NRIs. These accounts pertain up to 2006.
He said that action has been initiated and some account holders have admitted to their accounts, some have paid taxes and some have denied having any such accounts.
The attorney general also noted that the Income Tax Act has been amended to extend the limitation period up to March 31, 2015, for recovering taxes from these account holders. Under earlier provisions, the limitation period was six years which in these cases came to an end in 2012.
He told the court that government had no intention to hold back any information or names and was open to any inquiry by the Central Bureau of Investigation, Income Tax authorities or any other agency.
The court directed that the sealed envelope with the names be given to Special Investigation Team (SIT) chairman Justice M.B. Shah and vice chairman Justice Arijit Pasayat.
The SIT was directed to be set up by the apex court's July 4, 2011 order, but the notification was only issued May 29 this year after the court May 23 gave the government a week's time to comply with its orders.
The court said the SIT will move into the matter in accordance with the law. "We permit the SIT to deal with the matter in accordance with law," the court said in its order.
All the 627 accounts are at HSBC Bank in Geneva - the details of which India got from the French government.
These are also known as stolen data and when the Indian government approached the Swiss authorities for assistance, they refused to help, saying that they don't deal with stolen data.
However, HSBC Bank said that if the Indian authorities get an no-objection certificate from the account holders, then it would share the details. About 50-60 account holders gave their consent.
As Rohatgi gave the court the list of names, it asked about the information that government had received from Germany in March 2009.
He then told the court that German tax authorities had given 26 names. Out of that prosecution has been launched against 18, while the others were found to holding genuine accounts.
Rohatgi told the court that the government has "only one request that is according to terms of the treaties entered by the government with other countries there is a confidentiality clause and nothing should be done that may impede our ability to get information from these countries and other countries" on foreign accounts of Indian citizens in future.
To this, the court said it had "no intention of causing any embarrassment to the government". "We will send all these names to the SIT and ask them to proceed in accordance with law."
Rohatgi said that the government had already given the list of the names along with other details to SIT.
Directing further hearing of the matter Dec 3, the court said that the SIT team will submit its status report on the steps taken by it in pursuance to the list of 627 account holders.
On Tuesday, the central government was directed by the Supreme Court to furnish in a sealed envelope the list of all individuals and entities in its possession who have accounts in overseas banks, legitimate or otherwise.
The directive to this effect came a day after the government gave the court the names of seven individuals and one company, alleging they had funds in bank accounts abroad over which proceedings had been initiated for tax evasion.
Senior counsel Ram Jethmalai, who - along with others - is a PIL petitioner on whose plea the court had passed the July 4, 2011, order constituting the SIT urged the court that the government should desist from employing double taxation avoidance agreements for stonewalling the information sought by them and DTAAs were a fraud on the nation.
