Under the Automatic Exchange of Information (AEOI), India will start receiving information about cash stashed in Swiss banks from September 2019

New Delhi: Industrialist Sanjay Dalmia, Dinesh Kumar Himatsingka, Executive Chairman of Bangalore-based Himatsingka group, are among about a dozen Indians with Swiss bank accounts whose names have been made public in Switzerland’s Federal Gazette with regard to the ongoing probe into offshore accounts by the Income Tax authorities. The names of Dinesh Kumar Himatsingka’s brother Ajoy Kumar Himatsingka, Renu Tharani, Rakesh Kathiota, Pankaj Kumar Saraogi, Nalini Bhaskaran have also been made public after their details were sought by the Indian authorities.

Email queries to Sanjay Dalmia's office, Himtasingka and Saraogi did not elicit any response. Another reminder sent last week remained unanswered. This story will be updated as and when they respond.

According to the Ministry of Corporate Affairs record, Pankaj Kumar Saraogi is the director in at least 9 Kolkata-based companies. As per the Federal Gazette notification, Sanjay Dalmia's name was made public on 7 May 2019. Dinesh Kumar Himatsingka, who figured in the notification dated 14 May 2019, can file an appeal before the Federal Administrative Court, St. Gallen, Switzerland within 30 days while providing reasons and evidence in his support.

Under the Automatic Exchange of Information (AEOI), India will start receiving information about cash stashed in Swiss banks from September 2019. In November 2016, India and Switzerland had signed a joint declaration for the implementation of AEOI between the two countries and subsequently, a mutual agreement was signed on 21 December 2017 to enable the exchange of data with respect to 2018.

The government had received information about 628 Indians holding bank accounts in HSBC bank in Switzerland under the Double Taxation Avoidance Convention (DTAC) that has been signed between India and France. Subsequently, further investigation was launched by Indian authorities, which revealed an undisclosed income of approximately Rs 8437 crore in 2017. Apart from recovery of taxes, the concealment penalty of Rs 1287 crore was slapped in more than 160 cases.

The Narendra Modi government has also detected more than Rs 11,010 crore in undisclosed foreign accounts after a massive data leaks by a whistleblower pertaining to offshore entities. A multi-agency group under the Ministry of Finance has also been set up for coordination and speedy investigation into undisclosed foreign assets of Indian citizens.

There are several other mysterious Indian nationals whose name figures in the list but their details were withheld by the Swiss authorities. For example, a certain 'D M born on 6 April 1989, Citizen of India' and 'J K J born on 19 June 1965, Citizen of India' figure in the list. Another name in the list is 'RN born on 30 October 1948.' According to Swiss authorities 'RN is linked to 'C C Limited, a firm that was floated in tax haven British Virgin Island on 17 February 1999. Swiss authorities in the notification said: “A complaint can be lodged against this final decision within 30 days of opening at the Federal Administrative Court, PO Box, 9023 St Gallen. Any order prior to the final order may be contested together with the final order. The notice of appeal shall contain the request to give reasons for it, indicating the evidence and the signature of the applicant or his representative.”

As far as offshore shell firms are concerned, there has been a sustained effort by the NDA government headed by Prime Minister Narendra Modi for cracking a whip against mailbox companies operating in tax haven countries. After a high-level meeting with British Virgin Islands authorities in July 2017, some information has already been provided to the Indian government.

Two other Indians with Swiss bank account numbers are—JD born on 8 February 1960 and AD born on 10 May 1956. Both the Indian citizens have been provided with an opportunity to approach the court against Swiss authority’s decision of sharing information within 30 days with reasons and evidence. Another notification carries the names of 'S L S and B L S—perhaps siblings and S S born on 15 August 1958 and PS born on 23 September 1958. Three other Indian citizens have been named in a separate notification including 'OPL born on 26 May 1949, UL born on 28 August 1952 and VL born on 28 September 1977. They are also linked to British Virgin Islands-based firm ‘Middleburg Capital Limited.’

A few other Indians on the list of Swiss bank account holders are 'PM born on 1961, YA born on 30 April 1963 and PKK born on 23 January 1946. The first robust step by the government was the enactment of a law—Black Money (Undisclosed Foreign Income and Assets) and imposition of Tax Act in July 2015 to effectively tackle the cases involving black money stashed abroad.

According to the Finance Ministry, which commissioned at least three studies on unaccounted income and wealth abroad, has revealed that the reliable estimation of unaccounted income is extremely difficult, however, it could be ranging from 7 percent to 120 percent of the GDP. These measures along with other laws like the Fugitive Criminal Offenders Act, have brought an undisclosed income of about Rs 1,30,000 crore to tax in the last five years and seizure of assets worth approximately Rs 50,000 crore excluding foreign assets worth Rs 1,600 crore during the same period.