Pranab Mukherjee’s statement on black money an eye-wash?

The Bharatiya Janata Party (BJP) BJP National vice President said Union Finance Minister Pranab Mukherjee’s statement on black money stashed abroad by the corrupt politicians, dishonest bureaucrats and businessmen is merely an eyewash to divert the attention of millions of countrymen, whose ?hard-earned money has been looted by them since past six decades?.

In a press statement issued here on Friday, Shanta Kumar said that United Progressive Alliance (UPA) government is ?deliberately intermingling? the issue of black money with the tax-evasion.

He said that the huge amount kept in Swiss banks by the Indians had been termed by the Swiss government as ?stolen property? and this has been clearly indicated by the Swiss authorities as amount collected through illegal and corrupt practices.

Shanta Kumar said that Mukherjee’s agenda to acquire the names of Indian depositors as revealed in media is utopian one and would not fetch any fruitful result for the country.

He said Linchestien Government had totally refused to reveal the names of the Swiss Bank account holders as the treaty between India and Swiss Governments need further ratification by European countries.

Shanta Kumar said that UN convention against Corruption was the only international legal instrument to recover back the money from tax-heaven countries. He said this historical Convention had been signed by the 140 countries and ratified by 126 countries including Switzerland. S

?Surprisingly, despite signing the Convention in 2005, India had not yet ratified the treaty.? He said, by not ratifying the Convention, the country had been deprived of legal cooperation by the member countries.

He said after ratification, some of the countries had started to recover the amount.

He said Swiss representative had declared in the UN General Assembly last year that his Government was ready to cooperate with the countries whose illicit money was lying in Swiss banks.

Kumar also disclosed that Government of Switzerland had enacted a law to return the money. He said this would only be possible with the strong political will of the country from where the black money had been originated.

He said that Article 51 to 54 of the Convention binds member countries to share the information if the illicit amount kept in their banks and since Switzerland had also ratified the Convention, it would be legal binding on Swiss government to disclose the names of Swiss Bank account holders.

He urged that present government should immediately ratify the UN Convention Against Corruption so as to pressurise the tax-heaven countries to return the ill-gotten money back to the originating countries.

Kumar said that Government was deliberately evading the issue of ratifying the Convention as no mention of the Convention had been made in the recent statement of Finance Minister. He said this issue was time and again raised by him in the Rajya Sabha but no response had been given by the Government.

“Even Prime Minister did not bother to reply my letters, in which I had asked Government to justify why India is not initiating the ratification process despite the fact that 126 member countries had already ratified the Convention” he added.

Referring to the case of Pune businessman Hasan Ali on Swiss Bank accounts and Income Tax recovery notice, Shanta Kumar said that Hasan Ali Khan was served Income Tax notice in the year 2007 after a raid on his residences across the country and ten accounts of worth one lakh dollars in Swiss banks were also detected and thus a notice to deposit Rs. 40,000 crore as tax was issued on Khan.

?The fact had also been confessed by the UPA government in Rajya Sabha on 4th August, 2009.? He said UPA government had deliberately delayed the proceedings against the Khan to facilitate him to withdraw the amount kept in Swiss banks.

He said UPA government should immediately take action to seize Khan and his accomplice’s Swiss bank accounts.

Kumar said recent reports on the missing Swiss bank accounts of Khan was a concern for nation too as Khan had established links with Adnan Khashoggi, who was known International Arms dealer.

He said all allegations against Khan to have links with politicians have been raised in Maharashtra Vidhan Sabha also. ?It seems that lenient view taken by the Government on his fake passport case was due to his political links with ruling Party.?

Mukherjee on Tuesday said though no reliable estimate of black money is available, the government is formulating a five pronged strategy to bring back the money stashed in foreign banks as well as stop further outflow of money.

He also defended the government?s decision not to disclose names of Indians with foreign bank accounts.

As the government faced criticism from the Supreme Court and Opposition parties over its reluctance to disclose names of Indians with foreign bank accounts, Mukherjee addressed a press conference here to ?share with you the proactive steps taken by the government to combat the menace of illicit funds generated both as a result of tax evasion and corruption?.

Mukherjee, pointing that there is no reliable estimate of black money both inside and outside the country, said an interim recommendations of BJP Task Force 2009 have estimated the amount of black money to be between USD 500 billion to USD 1,400 billion, while a current study by Global Financial Integrity has estimated the present value of illicit money outflow to be USD 462 billion.

?Government has been seized of the matter and has constituted a multidisciplinary committee to get studies conducted to estimate the quantum of illicit fund generated by Indian citizens,? he said.

Mukherjee informed undisclosed income of about Rs 15,000 crore has been detected in the last 18 months.

?During the same period, Directorate of International Taxation has collected taxes of Rs 34,601 crore. The Directorate of Transfer Pricing has detected mispricing of Rs 33,784 crore, which has prevented shifting of an equivalent amount of money outside India,? he added.

The Union minister, once again stating the government?s inability to make public the names, said India was bound by international treaties.

?The government has nothing to hide. We can’t get any information on black money unless there is legal framework. Whatever information we have got is on condition of secrecy. We have given names to Supreme Court,? Mukherjee said.

He maintained that if India were to dishonour the international agreements, foreign nations may not share information with it in the future.

In order to address the issue more effectively, the government has formulated a five pronged strategy which consists of joining the global crusade against ?black money?; creating an appropriate legislative framework; setting up institutions for dealing with Illicit Funds; developing systems for implementation; and imparting skills to the manpower for effective action, the minister informed.

Mukherjee said India has completed negotiations of ten new Tax Information Exchange Agreements with Bahamas, Bermuda, British Virgin Islands, Isle of Man, Cayman Islands, Jersey, Monaco, Saint Kitts & Nevis, Argentina and Marshall Islands out of 22 identified countries/jurisdictions.

?India has initiated process of negotiation with 65 countries to broaden the scope of Article concerning Exchange of Information to specifically allow for exchange of banking information and information regarding taxpayers not covered by DTAA,? he added.

The administrative machinery is being strengthened by setting up eight more income tax overseas units, besides the two units operational in Singapore and Mauritius.

Strength of foreign tax division has been doubled and government is setting up an Exchange of Information (EoI) Cell, which will help in effective exchange of information to curb tax evasion, the minister further said.