Former Supreme Court Judge, Justice (retd) M B Shah, who heads the Special Investigation Team (SIT) on black money, said that he had already directed a probe into The Panama Papers, investigated by The Indian Express and the International Consortium of Investigative Journalists that has revealed over 500 Indians linked to offshore firms.
Speaking to The Indian Express today, Shah said that while the documents looked authentic “prima facie,” the offshore companies needed to be probed to check if they were legal and set up as per RBI guidelines.
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Asked how The Panama Papers affects the SIT probe, Shah said, “I have already asked officials of all the departments yesterday to investigate. It will take time. It is not easy and simple. If required, more persons could be appointed,” he said.
Speaking at the office of Gujarat State Law Commission which he heads, Shah said: “Prima facie, (The Panama Papers) looks authentic… However, it needs to be investigated if the (offshore) companies have been established as per RBI guidelines. You cannot jump to conclusions…If an Indian citizen has done this with the permission of RBI, then it’s legal. Otherwise, action can be taken.”
Shah said there was no deadline for his probe and that the officials under him, from almost all the departments of the Central government, would probe any papers that became available.
Shah said he had submitted four reports in connection with the black money probe. While the first report was submitted in August 2014, the SIT in the second report filed in December 2014, found 427 actionable cases in the HSBC list of 628 persons and entities. The amount involved was approximately Rs 4,480 crore. Of these, the Finance Ministry had finalised assessment of 79 assessees and an amount of Rs 2,926 crore has been brought to tax towards undisclosed balances in the accounts relating to these persons.
Prosecution had also been initiated in other cases.
The SIT had pointed out several lacunae in the regulatory structure in its third report in mid-2015. It pointed out to the possible misuse of long term capital gains tax, participatory notes, shell companies, for money laundering.