The government Thursday told the Supreme Court that under the Double Taxation Avoidance Agreement (DTAA) with other countries, it could not disclose the names of the people under investigation for alleged money laundering and parking funds in foreign banks based in tax havens.
The apex court bench of Justice B. Sudershan Reddy and Justice S.S. Nijjar was told by Solicitor General Gopal Subramanium that under the provisions of the Income Tax Act, the DTAA agreement had the force of domestic law and thus any information coming via that route from other countries can’t be made public.
In a related matter, the court asked Delhi Police commissioner to file a status report on its investigation on a complaint that Enforcement Directorate (ED) officer Prabha Kant had threatened Indian Institute of Technology-Kharagpur Director S.K.Dubey for writing to Prime Minister Manmohan Singh against ED officials investigating the money laundering scam.
“It is a very, very serious matter concering the nation. Don’t try to trivialise it by engaging in settling individual grudges,” the court said.
The court was earleir told by Subramanium that the government could make the information regarding alleged money launderers public only after prosecution was launched against the accused. In that situation, legally they (names) come in the public domain and could be made public.
The solicitor general said this to the court in response to its earlier direction as to why the central government could not make public the names of people which were given to it by German authorities and who were holding money in banks in Liechtenstein, a central European country.
As the solicitor general sought to explain the legal compulsion of international treaties in withholding the names, the court wanted to know why the entire investigation into money laundering was centred around alleged tax evader Hasan Ali Khan and other group of individuals.
The court wanted to know why the investigation by the ED was becoming individual centric. “(Mr.) solicitor general why it is becoming one individual centric investigation. Is it that all money laundered abroad was individual centric,” the court asked.
Have you found anything about the people, other than the one individual (Hasan Ali) or group of individual. “Is it only one person who is holding account in Swiss banks and none other,” the court asked.
“Are you saying that no other Indian has an account (abroad) which is suspect. There is nothing wrong in having accounts in foreign banks so long they are not suspect. But are you saying that no Indian has parked his money abroad that is not suspect,” the court queried.
Asking the solicitor general not to limit the scope of the petition by limiting it to individuals whose names have surfaced in context of banks in Liechtenstein, court wanted to know what other information was available with the government.
The court’s queries came in the course of the hearing of a petition by jurist Ram Jethmalani seeking direction to the central government to take steps to recover black money stashed away in foreign banks by Indian citizens.
The case would be heard next Monday.