Rs 6400 crore: That's the black money stash from India lying in HSBC accounts

The special Investigation Team (SIT), which is monitoring the probe into the black money case, told the apex court on Tuesday that the total undisclosed taxable income from unreported HSBC accounts abroad was Rs 6400 crore.

FP Staff May 13, 2015 13:35:57 IST
Rs 6400 crore: That's the black money stash from India lying in HSBC accounts

The special investigation team (SIT), which is monitoring the probe into the black money case, told the apex court on Tuesday that the total undisclosed taxable income from unreported HSBC accounts abroad was Rs 6400 crore.

On the basis of investigations carried out so far in respect of the 628 entries/persons having accounts in HSBC, there was no amount mentioned in 289 cases while a sum of Rs 237 crore has been recovered as tax and penalties on blackmoney, it said.

The (SIT) submitted its report on the progress made in tracing and bringing unaccounted wealth from tax heavens. In its third report, the SIT has given the summary of steps taken, the results achieved and suggestions which can be adopted to bring illegal money back into the country.

Rs 6400 crore of black money lying in 339 HSBC accounts 

In essence, there are 339 accounts in HSBC held by Indians, which had a net amount of Rs 6,400 crore, on which the income tax department has raised a demand of Rs 4,520 crore. So far, only Rs 237 crore has been recovered.

"Amount is mentioned in 339 cases. (a) Total of peak balance is approx. USD 1.9 billion (i.e Rs 8624 crore). (B) Rs 2,224 is the total amount that of repeated/ duplicated entries on account of there being joint account holders/ beneficiaries. (C) Hence, net amount comes to Rs 6,400 crore," the report said.

"Amount of Rs 237 crore is recovered on tax and penalty demand raised. It does not include amount paid by way of self assessment tax in certain cases. Out of total 624 cases, 403 were actionable. Assessment in 373 cases has been completed. In 36 cases, concealment penalty of Rs 112 crore have been levied and such proceedings have been initiated in 180 more cases," SIT said in its report.

430 resident Indians have undisclosed income from unreported HSBC accounts

Giving credence to information given by International Consortium of Investigative Journalists (ICIJ) on black money holders, the SIT said it had conducted investigations on the data provided by the forum and traced 534 Indians so far, of which 430 were resident Indians.

The panel further said that the IT returns in these cases show that such transactions were not disclosed to the Income Tax department.

"During the course of investigation, 176 persons have admitted their relationship with such offshore entities/ transactions. Further inquiry is under progress," it said.

It said that the CBDT has been able to "detect unaccounted income to the tune of Rs 7,078 crore during 2013-14 and corresponding figure is Rs 4,456.96 crore for 2014-15 (till Feb. 15)".

Cricket betting could be generating Rs 3 lakh crore worth of black money

Cricket betting has emerged as one of the key sources of blackmoney generation and according to one account it could be as high as Rs 3 lakh crore.

Large amounts of black money are being transacted every year. As per the FICCI report, it comes to more than Rs 3 lakh crore. This is required to be controlled," the apex-court appointed SIT said in its brief summary to a bench headed by Chief Justice H L Dattu.

SIT worried about UP govt not taking action against Yadav Singh

Rs 6400 crore Thats the black money stash from India lying in HSBC accounts

Representational image. Reuters

SIT has also raised concern over the UP government's failure to conduct proper investigation into the Rs 900 crore scam involving its employee Yadav Singh (former chief engineer of Noida) while seeking the Supreme Court's intervention.

It was alleged that Singh's had got the money during his stints as the chief engineer of three authorities — Noida, Greater Noida and Yamuna Expressway — during Mayawati's tenure and the current Akhilesh Yadav government in UP.

SIT noted that the Uttar Pradesh government has not taken action against Yadav Singh despite huge amount of unaccounted money found in his possession. According to a report in the Business Standard,  SIT had recommended the case against Singh, the prime accused in the multi-crore farm house scam, should be probed by the Central Bureau of Investigation (CBI). However, the investigative agency informed SIT that it is a state matter and it cannot take action without authorisation from the state. The SIT asked the apex court to issue appropriate direction in the case.

The tax department has already seized cash and is in the process of scrutinising documents of real estate projects executed by Singh in the national capital region.

India ranks fourth on the list of 142 nations on the illegal money flow

SIT quoted a report of Global Financial Integrity (GFI) which revealed that illicit financial flow from India was "much more" and remained uncontrolled. The country ranks fourth in the list of 142 nations on the illegal money flow, it said.

The SIT informed the court that it discussed the GFI report of December 14, 2014 which mentioned that illicit financial flows for India for 2012 was Rs 5,93,557 crore and the cumulative illicit financial flow for 10 years was to the tune of Rs 25,00,000 crore.

Suggestions to tackle black money

Making PAN mandatory for purchase of goods worth Rs 1 lakh or more

The SIT said it is awaiting response from various departments on its suggestions like making mandatory mentioning of the Permanent Account Number (PAN) in the invoice for sale and purchase of goods worth Rs 1 lakh or more.

Special courts to hear income tax prosecution cases

SIT also sought a direction from the court to the authority for implementation of its earlier suggestion that five additional courts be set up in Mumbai to deal with such cases.

Senior government appointees and every poll candidate should file affidavit stating they do not hold illegal money abroad

The panel agreed with the suggestion of senior advocate Ram Jethmalani, who has filed the PIL on the black money, that every candidate should file an affidavit before the election that he or she does not hold any illegal money abroad and in the event of contrary findings, the persons be barred from electoral politics.

The same yardstick could be made applicable to senior appointees in the government like RBI Governor, SEBI Chairman, CBI Director, etc., the panel said.

With inputs from PTI

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