Tuesday, April 22, 2014

Not naming foreign bank account holders contempt: Supreme Court to govt

The Supreme Court on Tuesday said the Centre had committed "gross contempt of court" by not complying with its three-year-old judgment directing disclosure of names of Indian account holders in a Liechtenstein bank given to it by Germany. 

A bench of Justice HL Dattu, Justice Ranjana P Desai and Justice Madan B Lokur told solicitor general (SG) Mohan Parasaran, "We gave the judgment on July 4, 2011. Almost three years later, we find you have not complied with the orders to divulge the details of Liechtenstein bank account holders' names to the petitioner. This is nothing but gross contempt of this court's directions." 

It gave the government time till Tuesday to spell its stand on the issue. 

Parasaran argued that the court had directed setting up of a special investigation team (SIT) headed by Justice BP Jeevan Reddy with Justice M B Shah, both retired judges of the apex court, as his deputy. Since Reddy had expressed inability to head the committee, the SIT had not been set up, he said. 

Without the SIT going into the details received from Germany about Indians stashing their ill-gotten money in the Liechtenstein bank, their names could not have been divulged, Parasaran said. 

Appearing for petitioner Ram Jethmalani, senior advocate Anil Divan said the direction for supplying the information on foreign bank account holders to the petitioner was not linked to further investigation by the SIT, which comprised top investigating officers of different agencies like RAW, IB and revenue intelligence. 

The bench said, "SG please try to understand. Divan is justified in his submissions. The direction to share the information forthwith cannot be understood as after completion of investigation by the SIT. The court had said forthwith disclose. The SIT will come at a later stage. The language of the court is clear. The directions are crystal clear when it said disclose forthwith." 

Parasaran said he would take instructions and report back to the court. Giving him time till Tuesday to do the needful, the bench said, "From July 4, 2011 till now, the revenue secretary and the joint secretary in the ministry of finance had kept our orders in cold storage. The Centre appears to have been carried away by Justice Reddy's letter expressing inability to head SIT." 

The court had rejected the Centre's petition seeking review of the July 4, 2011 judgment, which had slammed the Centre for lacking in vigour to probe black money and took over investigations into it by setting up a multi-discipline SIT to investigate the crime in India and abroad as well as accused Hasan Ali Khan. 

Khan, who once was the prime focus of investigation by revenue intelligence agencies as well as Enforcement Directorate (ED), got an unexpected reprieve from the Centre. Parasaran told the Centre that there were no billions of dollars deposited by Khan's alleged associate Kashinath Tapuria in Swiss banks. 

The SG cited a Swiss government report saying most of the documents relied upon by the agencies were forged and that in reality, the deposits did not exceed $60,000. To this, Jethmalani responded, "The documents were forged? But these were seized from Tapuria's residence and were relied upon by the government's investigating agencies in charge-sheeting Khan and Tapuria." 

In the July 4, 2011 judgment, the court had directed the Centre to reveal names of Indians who stashed unaccounted money illegally in foreign banks provided they had been issued show cause notices by tax authorities after completing proceedings against them. 

It also dismissed the government's plea that the double taxation avoidance treaty between India and Germany prohibited revealing names of the 26 Indians who held accounts in the Liechtenstein bank. 

It had questioned the government's wisdom in allowing UBS, allegedly the most favoured among Swiss banks for Indians to stash black money, to open retail banking outlet in India.

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