Details of offshore entities listed in the Panama Papers, published by The Indian Express in collaboration with the International Consortium of Investigative Journalists in 2016, led to the January 19 searches at the premises of the Bharat Hotels Group Panama Papers.
Government officials told The Indian Express that following the publication of the Panama Papers, several references were sent by the Central Board of Direct Taxes (CBDT) to offshore jurisdictions and once information was received, searches were conducted at 13 locations in and around the Capital.
Following the operation and recovery of evidence of the links of the promoters of the Bharat Hotels Group to a clutch of offshore companies listed in the Panama Papers, the CBDT has dispatched fresh references abroad, this time for details of assets and properties held by offshore companies incorporated by Mossack Fonseca.
The Panama Papers refer to more than 11 million documents from the files of Mossack Fonseca, a law firm in tax haven Panama, which set up labyrinthine offshore companies for its worldwide clientele of the well-heeled. Hundreds of individuals used the firm — and the secretive, lax regulatory system in which it operates — to set up offshore entities in tax havens around the world.
In a press release, the CBDT said “undisclosed foreign assets” of over Rs 1,000 crore had been detected during the searches. But officials said the amount would be several times that figure, and that the Bharat Hotels case was likely to become one of the biggest detection of the Panama Papers cases in India.
The CBDT said provisions of the 2015 Black Money Act may be invoked in this case, and they had evidence that “a large amount of black money was stashed abroad by the group, through the mechanism of Trusts, formed in the early 1990s in tax havens”.
Hitherto unpublished details from the Panama Papers data show that following the death in 2006 of Bharat Hotels Group proprietor and former MP Lalit Suri, his brother-in-law, Jayant Nanda, was inducted as a Director in several of the Mossack companies located in the British Virgin islands (BVI), the Bahamas and Hong Kong.
A resident of UAE, Jayant Nanda was detained by Income Tax sleuths at the Delhi airport on January 19 when simultaneous searches were underway.
Fresh evidence from the Panama Papers reveal that the focus of the Income Tax sleuths is on the ownership of a Panama-based entity called Richmond Enterprises SA and several other offshore companies to which it was linked, and were mostly incorporated between 1990 and 1992.
Asked about these links to offshore companies named in the Panama Papers and undeclared foreign assets, the official spokesperson for the Bharat Hotels Group said they had “no comments” to make.
Among the companies are two BVI-based entities: Blue Shore Circle Investment Ltd, of which Jayant Nanda became a Director in November 2007 and Sure Line Holdings Inc. There are documents to show that 25,000 shares of Sure Line Holdings Inc were transferred to Nanda as late as February 2015. This company is also among those who received a “resignation” notice from Mossack Fonseca in February 2017 following the global media leak. The notice was in the name of Jayant Nanda, wherein he was asked to find a new registered agent for the firm.
There are other companies under tax scrutiny as they were linked to Richmond Enterprises SA: Peran Limited and Amex Investment Limited, both incorporated in Hong Kong, and J&W Inc, incorporated in Nassau, Bahamas. The Mossack Fonseca data set shows cross-holdings between these companies. For instance, in August 2001, Richmond Enterprises SA acquired 1,000 shares of J&W Inc.
Officials said that besides recovered documents showing linkages to these offshore entities, the searches have revealed that several offshore Trusts had also been set up by owners or associates of the Bharat Hotels Group. Among the Trusts are the Charisma Trust, Oasis Trust and Pacific Trust.
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