The Special Investigation Team (SIT) on black money has pointed fingers at the erstwhile UPA Government saying due to its faulty approach in obtaining information on tax evaders under Double Taxation Avoidance Agreement (DTAA), the German authorities could share only 30 names with their counterparts here although the list of defaulters included 1,400 Indians.
The revelation was made in a sealed cover report given to the court by the SIT, headed by former Supreme Court judges MB Shah and Arijit Pasayat. The SIT, also comprising heads of investigating and intelligence agencies — RAW, IB, DRI, CBI, ED and officials of the Government — further informed the court that scrutiny of all big imports,particularly those relating to power plant equipment revealed massive over-invoicing. It has suggested that all imports below Rs10,000 crore must be re-examined to rule out possibility of over-invoicing. This is the first report of the SIT, the setting up of which was the first decision of the Modi government in line with the orders of the Supreme Court.
According to the SIT findings, 30 names of Indians holding black money in liechtenstein Bank was provided to India by the German authorities. Although the liechtenstein Bank had 1,400 Indians on its list, the German agencies were not in a position to share the information with India as the information was made subject to two conditions — one, it had to be drawn under the Double Taxation Avoidance Agreement and second, information in the past was not to be shared. This resulted in underreporting of information.
The bench of Justices Hl Dattu, Ranjana Desai and Madan lokur took the report on record and directed the SIT to submit its next report on November 11. Senior advocate Ram Jethmalani, who filed the PIl on black money, stood vindicated since he had argued that the route of DTAA adopted by the previous Government was a surreptitious way to avoid information. His counsel Anil Divan told the Court that information ought to be obtained under the UN Convention Against Corruption to which Germany, France and Britain were parties. India had signed the Convention in 2005 but ratified it only in 2011.
The SIT is understood to have recommended that the Centre must take a comprehensive look on the mutual agreement treaties and “effect necessary changes” to ensure free flow of information in future.
The court allowed both Jethmalani and Divan to interact with the SIT members and suggest possible ways and means of getting black money from foreign banks. Jethmalani further informed the Court that pursuant to constitution of SIT, he visited Germany in March this year and met officials in the German Finance Ministry with regard to black money details of Indians in liechtenstein bank. He even wrote letters to the German Finance department on this issue. According to him, some “hard information” was exchanged between the two governments after they held high level meetings.
The Court directed Additional Solicitor General Nerraj Kishan Kaul to obtain information on the same and report to Court on next date.