Panama Papers: Government sets up multi-agency probe team; Congress terms it cover-up bid

Early Monday morning, soon after the probe by the International Consortium of Investigative Journalists (ICIJ) into the offshore links of prominent people – called Panama Papers – got leaked, Prime Minister Narendra Modi called his minister of finance. The PM, apparently, was miffed about his own government's failure in acting against those who have stashed money in tax havens abroad even after coming up with an offer of voluntary declaration of assets.

Arun Jaitley later said that a group – which includes officials from Central Board of Direct Taxes (CBDT), Reserve Bank of India (RBI), Foreign Tax and Tax Research and Financial Intelligence Unit (FIU) – has been set up to take the probe forward and take stern action against those in the list.

"They will continuously monitor these (accounts) and whichever accounts are found to be unlawful, strict action as per existing laws will be taken," he said. The Special Investigation Team (SIT) on black money also said it will investigate thoroughly the reported secret list.

According to ICIJ investigations, the mega-rich are using complex offshore structures to own mansions, yachts, art masterpieces and other assets, gaining tax advantages and anonymity not available to average people. Media reports have mentioned names including Amitabh Bachchan and Aishwarya Rai Bachchan, to corporates including DLF owner KP Singh and nine members of his family, and the promoters of Apollo Tyres and Indiabulls to Gautam Adani's elder brother Vinod Adani. Two politicians who figure on the list are Shishir Bajoria from West Bengal and Anurag Kejriwal, the former chief of the Delhi unit of the Loksatta Party.

The Opposition Congress, however, rejected the mechanism as a mere eye-wash and an attempt to cover up. Party's chief spokesman Randeep Singh Surjiwala said instead the list should be sent to the same bench of the Supreme Court, which is already investigating the black money, as everybody has faith in the judiciary. "We reject constitution of a multi-departmental committee by the FM as a shoddy attempt to brush aside this revelation. We demand a time-bound inquiry and reference of the matter to SC bench already examining black money case," he said.

He added that PM's credibility was at stake as 500 more such names are likely to be released in public domain. He alleged that some of them are industrialist friends of the Prime Minister and his travel companions.

Surjiwala said the probe by a committee of multiple departments will never see the light of the day. "Why matter is not being referred to Supreme Court which is already investigating it?" he asked.

"Panama papers only reveal the vehicles which have been used by certain entities in order to park their assets or wealth abroad. They really do not disclose how much of wealth or how much of assets are parked where," another Congress spokesperson Manish Tewari said.

A similar investigation, as announced by Jaitley, was announced by his predecessor P Chidambaram in April 2013, following similar revelations. The list of offshore owners then named included Ravikant Ruia, Vijay Mallya, Congress leader Vivekanand Gaddam, also vice-chairman of Visaka Industries, Mumbai-based jewellers, Rashmi Kirtilal Mehta and KM Mammen Mappillai, the founder of India's leading tire manufacturer, MRF Tyres.

Jaitley said the latest ICIJ list was the fourth collective bunch of such information. "The first related to Liechtenstein accounts, in which prosecutions have been launched and assessment orders passed," he said. The first list had come out in 2011, on HSBC account holders. Five hundred and sixty nine out of those account holders have been traced. Three hundred and ninety were illegal and already 154 set of prosecutions have been filed, said Jaitley.

He said that detailed assessment orders have led to the discovery of illegal assets worth around Rs 6,500 crore. In 2013, the ICIJ had published a list of 700 persons. Of these, 434 Indian entities were traced and 184 of them admitted their relationship with the accounts and the process of passing assessment and prosecuting them is now on. Already 52 prosecutions have been filed by Income Tax authorities.