Black money: Probe into Indians named by HSBC, Leichstenstein banks complete, says Arun Jaitley

The government has completed investigation against persons named in HSBC and Liechtenstein banks for black money stashed abroad and made an assessment totaling around Rs 15,000 crore in the two cases.

Disclosing this during Question Hour in the Rajya Sabha, Finance Minister Arun Jaitley said investigation against 628 persons named in the HSBC list of Indians holding foreign bank accounts has been completed, an assessment to the tune of Rs 8,437 crore in 409 of these cases made and 119 prosecutions filed against them. The government has also assessed each of those named by the Liechtenstein Bank and an assessment of around Rs 6,500 crore of undeclared income by them has been made, he said.

Jaitley was responding to a question by Ram Jethmalani after an almost 30 minutes of acrimonious exchanges between ruling BJP and opposition members on the issue of black money. The heated arguments began after the 94-year old veteran lawyer and suspended BJP member asked the government whether it had made any effort to get the names of black money holders offered by Germany. While the opposition accused the government of not doing anything except making false promises of bringing in black money stashed abroad, the government countered it saying several steps have been taken to bring in black money from abroad, including enactment of new laws to check the menace.

The House saw trading of charges when Jethmalani accused the Finance Minister of "lies", which infuriated the ruling party members who sought an apology. Jethmalani also charged the government with committing a "fraud" on the country. "You must expel all of them if you want the House to function," Jethmalani said as he sought silence in the House, to which the Chair said it is an "interesting suggestion but cannot be implemented".
Jethmalani said "the German government has offered to disclose information on account holders stashing black money. Did you make any effort to avail of the offer made publicly by the German government."
When ruling party members including Ministers demanded an apology, Jethmalani earlier said that he was 94 years old and "these young men don't have the courtesy to let me speak." Chairman Hamid Ansari kept on chiding the ruling party members and even saying "you are Ministers. You can't do it (standing up and protesting)". 

In his reply, Jaitley said the issue relating to the HSBC accounts and under different treaties, the information and some evidence was also in Switzerland. "Of the 628 persons named, all have been investigated. In 409 cases assessments have been completed and 119 prosecutions are being initiated. No Member of this House should think that others are not serious about black money," he said. "In each of them which were found to be unlawful, assessment proceedings have taken place and assessment to the extent of a possible Rs 6,500 crore of undeclared income has already been made," he said while replying to Jethmalani.

Jaitley said in addition to this, further action in respect of the accounts relating to the Panama papers was also being taken. As opposition and ruling party members traded charges, the Chairman said certain unparliamentary remarks made by Jethmalani has been expunged and the member has been cautioned over the use of language and unparliamentary words. "Whatever is unparliamentary has been expunged," Ansari said.
Jaitle  said among the series of steps taken by the government include agreements with G-20, FATCA and Switzerland government for free exchange of information of undisclosed income abroad.

Earlier responding to Congress member Rajiv Gowda, Jaitley said, "I am grateful to the member for at least acknowledging positively the exercise that the government has taken. I think recent political events may have resulted in wisdom dawning a little too late." Asked specifically on the total number of money that has come in to banks after demonetization, the Minister said, "No one definitive estimate can be made at this stage." He said there have been three expert committee reports which have given varied versions in the past and the CBDT has prepared detailed comments on these reports and those comments along with what is stated in those reports prepared by three specialist agencies would in due course be placed before the the Standing Committee on Finance so that they have an opportunity to examine it.

"But it is undesirably true that large amounts of cash money operating in the system does result in generation of black money. With all that money now deposited in banks, the anonimity with that money itself stands extinguished. "The money now stands identified with the owner of those accounts and hopefully a larger number of transactions through banks post this would now be inevitably possible," he said. After Jaitley had answered Jethmalani's question Congress leader Anand Sharma sought to raise some objections. Ansari was heard saying that the record would be examined and appropriate action taken. However, as some Congress members kept raising their points, Ansari was heard chiding them.

"Do you want me to adjourn the House," a visibly exasperated Ansari asked. Sharma tried to raise his objection again and said "Sir, what is expected of a minister?" Ansari replied that ministers know what is expected of them and told Sharma that he would check the records and take appropriate action and proceeded to the next supplementary. Responding to the next question about the flow of black money from abroad in the guise of FDI, Jaitley said the government has reworked tax treaties with Mauritius and Cyprus have been negotiations with Singapore in this regard have also been completed.

"All these routes which were beneficial routes for the inflow of money through a round-tripping process, we are trying to block them and treaties have been reworked." He said that the CBDT and the IT department have also taken steps to uncover the layers and find the real owners of shell companies. The Finance Minister said demonetization was one of the reasons of curbing black money. During demonetization, "we have seen that the government has taken steps to apprehend those who kept black money in the form of property," he said.

The entire cash gets deposited in banks and further generation of black money becomes difficult, he said. He said measures like enactment of the benami law, the GST too will have beneficial effects. Several restrictions on the purchase of certain luxury items as per the requirements under IT act will have an impact in the days to come, Jaitley added.