Intro: It seems that the black money ghost is not going to leave Finance Minister Arun Jaitley so easily and the upcoming Budget Session will be stormy after the disclosures made by The Indian Express.
The newspaper published an article on February 9 in which it named 1,195 individuals who were holding approximately 25,420 crores during the year 2006-07. The list was obtained by journalist of Paris based newspaper Le Monde and subsequently US based International Consortium of Investigative Journalists (ICIJ) analysed the data obtained by the French newspaper. Entire opposition took up this matter as an opportunity to attack the finance minister for the inefficiency of the government to handle the black money matter.
French government shared list of 610 individuals in 2010 and Income tax department has managed to trace 428 accounts and assessment is completed in 350 cases. Penalty proceedings have been initiated in 128 cases and prosecution cases have also been launched in 60 cases.
The new names, which have come into the public domain as a result of a global investigation by the International Consortium of Investigative Journalists (ICIJ), would be investigated.
— Arun Jaitley, Finance Minister
Income of 3,150 Crores has been brought to tax in these proceedings. Some of the evaders have approached the settlement commission and obtained immunity from prosecution after paying all the dues. It must be emphasised that recent list of 1,195 individuals include the names given earlier by the French government and all the cases are investigated by SIT. All these actions taken by the government clearly indicates that there is no favoritism and appropriate action is being taken against those who found guilty. If we look at the chronology of events over the past few months then there is nothing which raises a doubt over the integrity of the government.
In fact NDA government has done fairly well like setting up the SIT to investigate the matter, closing the assessment proceedings for those who found guilty etc. Bringing back the money stashed away is important but it is equally important to stop the outflow of money which is mostly in the form of international transactions by corporates, kickbacks in government deals, hawala transactions etc. Government has initiated to bring more transparency in the defence deals. Before jumping to any conclusion based on the list revealed by these investigative journalists we should appreciate the fact that it would be improper to draw a conclusion that all these accounts are having black money.
If mere publication of name makes someone guilty then I would like to remind that a Swiss magazine named Schweizer Illustrierte published an article in November 1991 and alleged that Rajiv Gandhi held 2.5 Billion Swiss Francs.
A Russia based investigative journalist Yevgenia Albats alleged that the Gandhi family accepted political pay-offs from KGB (Russian Intelligence Unit). Therefore the opposition must understand that naming someone in any list or report doesn’t make him guilty and the political parties should abstain from sensationalizing an issue which is important from not only from economic perspective but also have impact on diplomatic relations.
Mere disclosure of someone’s name in any list doesn’t make that person guilty and the government should be held liable in case it fails to act based on the inputs and evidences available with it.
Government is taking all the necessary steps to bring the culprits to the book but it needs evidence. Finance Minister has raised this issue on international forums like G20 and now government has announced cash reward to whistle blowers who provides evidence. Even Supreme Court is satisfied with the progress in this matter and asked SIT to submit its report by March.
Congress government announced VDS in 1997 but it drawn criticism as the assets declared in 1997 were valued at 1987 price and thus penalising honest taxpayers for their honesty and the current government can take some lessons from past mistakes. CAG also criticised the move of VDS and if the current government wants to introduce any such scheme then it would be advisable to keep the apex auditor also in the loop.
The objective should be recovering the ill gotten money and all parties should keep aside their political interest and discuss it constructively in the national interest.
Shshank Saurav (The writer is a Chartered Accountant)