SHOW ME THE MONEY

THE Swiss Banks have unanimously agreed to tax the money kept deposited with them by Indians and release the proceeds to the Indian Revenue Authorities. This move is being proposed as an alternative to the disclosure of details of Indians holding Swiss Bank Accounts and the enormous amount of Money lying therein. For years now, the Global Community has been mounting pressure upon the Swiss Government to dilute its disclosure policies in order to allow governments all over the world track down this fugitive money.

It is very ridiculously surprising how the US Government succeeds in getting access to close to 5000 Swiss Bank Accounts held by US Citizens, while India still does not manage to move the Singapore administration to come to its aid, despite estimates that Indian Citizens have the highest mount of Black Money stored up with the Swiss Banks. The Swiss Banks have been making Disclosure to the US Government. The banks have further paid a huge penalty of about 750 million dollars. These disclosures come in the wake of stern action by the U.S. Government which threatened to arrest Swiss Officials in US if Disclosures are not made. The US has agreed that further arrest and prosecution of its officers will be deferred during such time that the Bank is continuing its disclosures.

It is interesting to highlight the case of Mr. Hasan Ali Khan, a stud-farm owner from Pune. As on 8th December, 2006, he had a credit of more than eight billion US dollars equivalent to about Rupees 36000 crores, in the UBS bank, Zurich. He has been a stupendous defaulter in paying Income-tax to the Indian Authorities. Investigations which began in the year 2007 have disclosed that his account started with an initial deposit of US dollars 1.5 million in the year 1982. He was introduced to the UBS Bank by the notorious Adnan Khashoggi, a friend of an equally notorious Chandraswamy. Initial deposit was then transferred to Zurich, where by 1997 it had grown to 6.5 billion US dollars. In the next four months it rose to a little more than 8 billion dollars. Hasan Ali Khan was thus making deposits in this account of approximately 3500 crores a year. His last deposit in the bank is expressly marked with the legend “Arms sale”.

What is astonishing that this influential offender has never been arrested. It speaks volumes of his powerful connections. There is also reason to believe that he has other conspirators, two of them are Tapurias of Calcutta. The case was being treated as a simple case of tax evasion but in 2007, fortunately for the Enforcement authorities asked for assistance from the Swiss under the Mutual Assistance arrangement existing between the two countries. The Swiss complained that the Indian authorities had enclosed with their request some forged documents and also wanted to know whether the Indian investigation was into an offence of money laundering. An affirmative answer from would have brought about the necessary disclosure of persons involved in this stupendous fiscal scam. Since April, 2007 till today the Indian Government has not responded to the Swiss query. It should be plain to every one that at the highest level this investigation is sought to be frustrated because the persons involved are too powerful and the disclosure of their names would shake up the government and destroy its credibility.

How does the government propose to justify this delay and its slack and half-hearted approach in getting access to the huge quantum of national wealth locked up in safe heavens like the Swiss Banks? Don’t the tax payers have a right to be given an explanation? There are so many deserving and industrious youngsters and poor senior salaried individuals who continue to get dejected and burdened by the heavy tax rates while the Hasan Ali Khan’s continue to make hay?

It is estimated that there is as much as about 1500 billion US dollars which are locked up in these banks. This amount, if retrieved, would wipe out our national debt, domestic and foreign and allow this country to have tax free budgets for many years. What stops the Indian Authorities from anointing itself with this great acclaim?

Nani Palkhivala aptly quipped that “No policy can ever fail, if wisely conceived and honestly implemented.” We are still waiting for one such policy on Black Money.