UPA stalled, NDA sends I-T to survey HSBC

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Sources said the notice was served on Monday to HSBC India, asking it to furnish details of its banking transactions for the last 16 years.
Highly placed government sources said that in late-2011, the Revenue Department had declined a request from Income Tax to carry out searches on HSBC India, after the French government had shared details of 628 Indians with accounts in HSBC Geneva.

The 2011 proposal had reached the Revenue Secretary for direction before the Revenue Department said that the information available with the Income Tax was “too little” to carry out “searches on a banking giant”.

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“The new government had told tax officials to carry out investigations into HSBC as per directions of the Special Investigation Team (SIT) appointed by Supreme Court. The government has zero interference in this matter. Income Tax officials have been told to conduct themselves professionally but they will decide on who to raid and when,” a senior government source said.

The SIT on “black money” had also asked the Reserve Bank of India to share its annual inspection reports of HSBC India since 2005.

Meanwhile, a PTI report quoted the HSBC London office as saying it has been served a summons by the Indian I-T department for “alleged tax evasion, money laundering and unlawful cross-border banking solicitation.” The report added that HSBC Global has also been served “subpoenas and requests for information” from the US and other authorities with respect to certain US-based clients of HSBC in India.

According to officials, I-T investigators started focusing again on the role of HSBC India and its officials during the final days of the UPA government. On January 20, 2014, an I-T conference on the HSBC probe attended by the Director-Generals of Investigation and Intelligence and Criminal Investigation discussed the “typical modus operandi” followed in opening and operating the HSBC foreign bank accounts under investigation.

On October 27, 2014, a circular was issued by the Central Board of Direct Tax (CBDT) which said that the “involvement of HSBC/ its officials in opening and operation of the accounts also needs to be identified and reported to the Board. such facts would be extremely important while considering prosecution of HSBC/ its officials as abettors to Indian assessees.”