New Delhi: CPI(M) on Friday demanded "blanket prohibition" on Indians acquiring shell companies, claiming the NDA Government will "only scratch surface" by its proposed action in Panama papers case and is "unwilling" to touch structure of tax havens and generation of black money.
Former party general secretary Prakash Karat also demanded that the Centre confiscate illegal money and assets of those named in the Panama list, if it is "serious" about cracking down on black money, tax evasion and money laundering.
Karat though claimed the BJP Government "will not dare" take such action as the whole system of international finance capital is "intertwined" with elaborate structure of tax havens and shell companies.
To drive his point, he alleged it was the previous NDA Government which had "opened up Mauritius route" for financial investments from abroad "which has become a big source for money laundering and round tripping".
"The action proposed to be taken on Panama Papers further confirms the Modi Government will only scratch the surface and is unwilling to touch the structure of tax havens, money laundering and the generation of black money," Karat said.
He added, "If Modi government is serious about cracking down on black money, tax evasion and money laundering, then it should impose a blanket prohibition on Indians acquiring shell companies and operating secret accounts in tax havens. This is apart from confiscating illegal money and assets of those in the Panama list."
Karat made the remarks in the editorial of forthcoming issue of party mouthpiece 'People's Democracy'.
On Union Finance Minister Arun Jaitley's remarks that such exposures will help Government crackdown on illegally money kept abroad, Karat cast doubts saying the Modi dispensation's track record inspires "no confidence" in this regard.
"Two years after the Modi Government's coming into office, very little has been accomplished so far to bring black money back into the country," Karat said.
He observed the central government has "only taken a technical view" of those who have kept money illegally in secret accounts and operated shell companies.
The earlier exposures, Karat added, have only led to "some tax notices" to those who have not declared their money or assets abroad.
"As for Jaitley's claim that multilateral treaties will help India track down those who indulge in such illegal activity, Jaitley is only indulging in wishful thinking," he claimed.
Karat also sought to counter Jaitley and RBI Governor Raghuram Rajan on their reported stand that many of these acquisitions and accounts abroad may be legitimate, saying the same is "evading the real issue".
"Why does the government have to legitimise shell company acquisitions and maintenance of secret accounts in tax havens?" he questioned.
Karat stated the government had earlier "failed" to get information from Mossack Fonseca on queries about certain accounts and b0usiness dealings.
He said it also did not even take the step of blacklisting Panama as an "uncooperative tax territory", a step taken by French Government.
In the wake of media reports, the Union Government had on last Monday declared that action will be taken against "unlawful" accounts held abroad by Indians.
The Government also constituted a multi-agency group to continuously monitor information following the expose, which named 500 people including film actors and industrialists who have allegedly stashed money abroad.
The group comprising officials from CBDT, RBI and FIU (Financial Intelligence Unit) was set up on the advice of Modi, Jaitley had said.