Over 11 million leaked documents revealed that a Panama law firm, Mossack Fonseca, helped more than 500 Indians to set up offshore companies in tax havens around the world.
The Indian Express investigation team, led by Executive Editor Ritu Sarin, has meticulously crossed the ts and dotted the is for eight months before revealing the list of Indian names that featured in the #PanamaPapers.
Here are the reactions of those named in the list:
RESPONSE: K P Singh, responding on behalf of the family, said: “It is submitted that the permissible modus operandi of RBI for remittance of money under permissible LRS limit each year allows a Resident Indian to firstly open a bank account in a foreign bank and thereafter remit the funds in it. The remittances commenced in 2004 after RBI announced the LRS, the quantum of remittances were within the prescribed limits, and undertaken through the Authorised Dealer. “It is evident from the conduct of our foreign LRS bank accounts that the accumulated money was lying in the accounts for many years without being invested anywhere.
The actual fact is that the subscription towards the shares of an existing foreign company were made from the accumulated bank balance existing in out foreign bank account (LRS Accounts). “The actual remittance/s from India never exceeded the permissible LRS limit. The investments made by us related to subscription of shares of an existing foreign corporate entity which was not set up by us. Instead, this foreign corporate entity was set up by foreign nationals. No such action had ever been taken by us for setting up/ incorporation of a foreign corporate body.
All throughout and ever since 2004, acquiring shares (listed or unlisted) has been permitted through various Master Circulars issued by the RBI from time to time. Therefore, question of compounding/ wind up/ divest does not arise. “Since shares were acquired under LRS, there is no reporting requirement for the entity under FEMA. The details are mentioned in Schedule of Foreign Assets of our Income Tax returns every year since it is required under the Income-Tax Act, 1961 and rules made thereunder.
“It may be clarified that the shares in the foreign entity have been subscribed by us through and out of the funds held by us in our foreign bank accounts. No funds were remitted directly from India to subscribe/ acquire any shares of any foreign company. “It is further clarified that the shares in the existing foreign entity have been subscribed by us from the funds held in our LRS accounts abroad and not from the remittances from India. It is certainly not a violation of any RBI’s/ FEMA regulations. All remittances and utilisation of the funds are strictly in accordance with the rules and regulations of FEMA and Income-Tax Act.” (Read the entire story here)
RESPONSE: Amitabh Bachchan and family did not respond to repeated emails sent to them and phone calls made to their mobile numbers, Mumbai residences and the AB Corporation office for over a week. An AB Corp executive confirmed receipt of the email from The Indian Express on March 28. (Read the entire story here)
RESPONSE: Archana Sadanand, the media advisor to Aishwarya Rai, said: “What is this consortium (ICIJ) and what does it do? Is this an authorised entity and how do we know that the information they get is authentic? All information that you have is totally untrue and false.” (Read the entire story here)
Clients who knocked on a Panama door: (Read the entire list here)
Shishir K Bajoria
Response: “My family through a private limited company holds majority shareholding of IFGL Refractories Ltd which has a subsidiary IFGL Worldwide Holdings Ltd (IWHL) in Isle of Man. Also, my wife and myself are shareholders of Sonnish Ltd, another Isle of Man company. So I am a client of First Names Group, Isle of Man. I have not, nor have ever, owned (beneficially or otherwise) Haptic BVI Ltd. I believe that any connection to me was made in error,” said Bajoria.
First Names Group representative C G Hepburn said: “We made an administrative error on a form which we sent to Mossack Fonseca. The erroneous beneficial owner information on the form was entirely our fault, as was the enclosure of the copy verification document.”
Response: A spokesperson of Apollo Tyres stated: “India lawfully permits foreign investments in accordance with certain regulations. Any investment abroad, that the Kanwar family may have, is in due compliance with Indian laws, where applicable, including making disclosures wherever required. Much of family mentioned in your mail, are Non Residents of India (NRIs). They are covered by other nation’s permissible laws for their foreign investments, and are not covered by Indian laws & restrictions on residents, in matters such as Income Tax and RBI.”
Response: Salve said, “I set up Crestbright in 2012 — as a holding company to hold my lawfully made and fully disclosed investments based in the UK but the company has zero assets and zero income.
“I have been remitting funds since maybe 2003 under LRS. Out of these, some were invested in a portfolio in the UK and a patent in the US (a 25% stake with three other friends). Wanted to park these in a BVI company as at that time I was not a UK tax resident and wanted to avoid becoming one. Since 2014, I am a dual tax resident — UK and India, and so have not moved any assets into Crestbright.
“Edenoval was set up with a friend, and Pyebush was set up by me to hold shares in Edenoval. My friend had suggested some investments outside India and outside UK. Nothing materialsed; no income — no assets. All the three companies are virtually defunct.
“All my offshore assets upto 2014 were created out of funds remitted from my Indian bank to my UK bank account. After 2014, I have income in the UK too — and made some investments out of that. Since bank accounts are routinely called for by tax authorities, all Indian and UK bank details are filed. Nothing is withheld.
“However, the BVI companies have no value in any event — do not represent an asset or investment abroad. Besides, all LRS remittances are disclosed by the remitting bank to the RBI.
“As far as the letter of refence is concerned, Mrs Mahajan and Mr Ramesh Mahajan are Canadian citizens. He came back on a Transfer of Residence, and wanted a company to manage his offshore moneys. It was for that reason that I wrote the letter of reference to him to set up a company.”
Anil Vasudeva Salgaocar
Response: A member of Salgaocar’s family, who did not wish to be identified, said: “I am in no position to comment on this since we are not aware of these business interests. Nothing is known to us about these companies.”
Mohan Lal Lohia
Response: A company spokesperson said: “Mohan Lal Lohia is father of Shri Om Prakash Lohia, chairman and managing director of our company. Mohan Lal Lohia, Seema Lohia and Amit Lohia all are non-residents and are settled abroad. Although I am not aware about the overseas entities as stated in your mail, however, to my understanding activities carried overseas by NRIs are not required to be informed to Income Tax authorities or Reserve Bank of India in India.
Indira Sivasailam and Mallika Srinivasan
Response: Mallika Srinivasan stated, “I wish to clarify that I did not set up any offshore company and have no connection with Stanbridge Company Limited. It belongs to Mr V P Ahuja, an NRI…” In a separate response, V P Ahuja stated: “I confirm that Stanbridge Company Limited was set up for my sole benefit by me and that the shares were held by me in entirety.”
Tabasum & Abdul Rashid Mir
Response: Tabasum Mir said: “I am a resident citizen of India and Abdul Rashid Mir is an NRI. Neither he nor I have ever held any stake in or any control of Mondale SA which was incorporated and controlled by a trust founded by late Mujib Mir who almost his entire life was an NRI. After his unfortunate death in 2005, the trustees dissolved the Trust and distributed the proceeds amongst his family members who have fully disclosed the benefit so received by them to the concerned GOI authorities.”
Response: Patil said: “The company was created in 2007 as a buyer for issuing letters of credit in Europe. We were trading in agricultural commodities. We did one deal but suffered losses of Rs 1 crore so we shut it down the same year.”
Response: Zavaray said, “Yes, we are directors in the company. As we remitted money under the Liberalised Remittance Scheme through the automatic route, no special permission from RBI was necessary. We have disclosed all details to Indian tax authorities. As this was part of an official transaction, it was not necessary for any declaration under the amnesty scheme.”
Jehangir S Sorabjee
Response: Sorabjee said that he has complied with all disclosure norms. “The facts are correct. The company has received funds for investment sent abroad from India through the liberalised RBI scheme and is declared in my Income Tax returns to the Income tax authorities,” said Sorabjee.