New trail in tax haven probe leads to cash, property in UK, UAE

The cash trail has been traced by an investigation launched after The Indian Express, in collaboration with the US-based International Consortium of Investigative Journalists (ICIJ), reported on April 4, 2013 about the presence of 612 Indians in a list of individuals and companies from over 170 countries operating over 1.2 lakh offshore entities and trusts.

The list included two Members of Parliament — Lok Sabha Congress MP Vivekanand Gaddam and RS member Vijay Mallya — and several industrialists such as Ravikant Ruia, Samir Modi, Chetan Burman, Abhey Kumar Oswal, Rahul Mammen Mappillai, Teja Raju, Saurabh Mittal and Vinod Doshi.

The new evidence points to further secret investments made abroad by some of these prominent businessmen and at least two IAS officers, who had opened offshore companies either in their own names or in the names of their spouses.

As reported by The Indian Express, these people used international financial services providers such as the Portcullis Trustnet (PTN) of Singapore and the Commonwealth Trust Limited (CTL) in the British Virgin Islands to register offshore companies in tax havens.

The new details also expose Indians who had set up offshore companies via PTN but had denied doing so to tax authorities — they have now been sent showcause notices.

Many people linked to these offshore companies have already been confronted by tax authorities with data and balance sheets obtained from the British Virgin Islands and Singapore. One such beneficiary admitted to The Indian Express that while tax authorities have not passed on any original documents, they did hand over important data and transaction details, pasted on Excel sheets, as proof of involvement.

The fresh data authenticating the offshore accounts were obtained from PTN and the Australian taxation office, using the Tax Information Exchange Agreement, while details of further such investments were received from British Virgin Islands and Singapore.

However, as of now, NRIs on the list of those who routed their money through PTN are expected to be kept out of the probe, though I-T notices were sent to them initially.

Officials said that the Special Investigating Team (SIT) on black money set up by the NDA this year has been informed about the list of 612 and that the investigations were at various stages in each case.

The probe is being handled mostly by tax officials in Delhi and Mumbai with international channels are being tapped by the FTTR (Foreign Tax and Tax Research) unit of the Ministry of Finance.

Ministry officials told The Indian Express that balance sheets and asset details received by them confirm that cash and assets were routed by those in the list using PTN through British Virgin Islands and Singapore. They said they now expect authorities in the islands and Singapore to assist them in a bulk of the remaining cases.