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Saturday , January 29 , 2011
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SC raps Centre’s secrecy line

New Delhi, Jan. 28: The Supreme Court yesterday rapped the government again for failing to act against those who had stashed black money in foreign banks and accused it of hiding behind “technicalities” to avoid revealing their names.

“Is it from arms dealing... drug peddling or anti-national activities? These are very serious issues,” Justice B. Sudershan Reddy said.

The reprimand comes two days after finance minister Pranab Mukherjee had claimed that the government was doing whatever it could to recover the money.

The government has so far argued that it was pursuing bilateral treaties under which it could access such information from other countries, but could not make the names public because of the secrecy clauses in such Double Taxation Avoidance Agreements (DTTAs).

But the bench of Justice Reddy and Justice S.S. Nijjar rejected this and pulled the government up for merely treating it as an issue of tax evasion.

The court is hearing a public interest litigation (PIL) on black money filed by a group of citizens. Solicitor-general Gopal Subramanium had on the first day of hearing insisted that the government could not publish information procured from other countries under tax evasion laws, earning a rap from the court.

After the court reconvened yesterday, Subramanium continued his line of argument. “It would be difficult to get (such) information in future without the cooperation of other countries,” he said.

But the court shot back: “What action have you taken against those who you know have stashed money in LGT Bank in Liechtenstein?”

The government had earlier handed out some names, of 26-odd people, who hold such accounts.

“Looking at it from the point of taxation is only one aspect. Some names have been given by you. What steps have you taken against them? Have you set the law in motion? They are Indian people... amenable to Indian law,” Justice Reddy said.

The court asked the Centre to file a more detailed affidavit on the steps being taken to bring black money back into the country. Hearing resumes on February 3.

The bench also issued notices to the Reserve Bank, Securities and Exchange Board of India, Central Board of Direct Taxes, Enforcement Directorate, Central Vigilance Commission and the ministries of home, finance and external affairs on another PIL, filed by an NGO.

It has demanded that the government bring back a sum of Rs 65 lakh crore lying in Indians’ Swiss Bank accounts and other international tax havens.

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