Government does not have information about ‘foreign shell companies’ owned by Indians!
The Narendra Modi government has no data on the number of ‘offshore shell’ companies owned by Indians, despite the government admitting two years ago that the number of such firms stood at 2,38,223 between 2018-2021.
The government’s statement came after former Congress MP Rahul Gandhi said during a press conference on March 25 that “someone has invested Rs 20,000 crore in the Adani Group through shell companies.” He alleged that he was disqualified from the Lok Sabha after asking questions about Gautam Adani as his questions “intimidated” Modi.
According to a Financial Times report this month, 50% of Adani’s $5.7 billion (about Rs 20,000 crore) FDI inflow was from “opaque foreign entities with connections to the group”.
Rahul questioned, “There is a close relationship between Narendra Modi and Adani, suddenly Rs 20,000 crore has come in Adani’s shell companies. Where did this money come from?
According to a report in The Telegraph, the government’s statement about the number of ‘offshore shell’ firms owned by Indians was in response to a question asked by CPI(M) Rajya Sabha member John Brittas on March 21.
The amazing extent to which the Modi govt can go to conceal its patronage of Adani.
In June 2018, a task force to tackle the ‘menace’ of shell companies is announced.
In Parl today the govt says it has no definition, hence no information on shell companies!
The loot of India. pic.twitter.com/wBbdI0EUmp— Sitaram Yechury (@SitaramYechury) March 27, 2023
Union Minister of State for Finance Pankaj Chowdhary said in a written reply to a question, “Data/details about ‘offshore shell’ companies owned by Indian citizens are not available.”
Brittas sought with the following questions:
* Details of ‘offshore shell’ companies whose Ultimate Beneficial Ownership (UBO) is with Indian citizens.
* Details of action taken so far by the government to collect information on UBOs of Indian citizens in ‘offshore shell’ companies incorporated in tax-haven countries.
- Status of action taken against Indian nationals whose names surfaced in Panama Papers, Pandora Papers, Paradise Papers and other similar leaks.
- Details of foreign governments that have offered to share offshore transactions of Indian citizens with the central government.
- Details thereof and details of action taken thereon.
Chowdhary said, “An ‘offshore shell’ company is not defined in the Acts administered by the Ministry of Finance. Data/details are not available about ‘offshore shell’ companies owned by Indian citizens.
However, in a written reply to a question in the Rajya Sabha on July 27, 2021, Union Minister of State for Corporate Affairs Rao Inderjit Singh had said that the government had identified 2,38,223 shell companies between 2018 and 2021.
Government identified 238,223 shell companies without any specific definition in law.
Blinkers on only when it comes to Adani group family shells in Mauritius! pic.twitter.com/tYBowYhXPh
— Mahua Moitra (@MahuaMoitra) March 27, 2023
With regard to details of the action taken so far by the Center to collect information on UBOs of Indian citizens in offshore companies incorporated in tax haven countries, Chowdhury said, “In view of (a) above, there is no specific action.”
Chaudhary also did not give the number and details of Indians whose names figured in the Panama Papers, Paradise Papers, Pandora Papers and other such leaked documents.
He said, “Undisclosed income of over Rs 13,800 crore has been brought to tax in the Panama and Paradise Papers leak cases till December 31, 2022, and over 250 India-linked entities have been identified in the Pandora Papers leak. ”
The government said “undisclosed income of over Rs 8,468 crore has been brought to tax and penalty of over Rs 1,294 crore has been imposed” on account of “unreported deposits made in foreign bank accounts in HSBC cases”.
It further said, “As on December 31, 2022, under the Black Money (Undisclosed Foreign Income and Assets) and Tax Act, 2015, assessments have been completed in 408 cases, raising tax demands of over Rs 15,664 crore. ” But Chowdhary did not disclose the number and details of pending cases.
According to Chowdhary, 648 disclosures involving undisclosed foreign assets worth Rs 4,164 crore were made in the three-month one-time compliance window under the Act and Imposition of Tax Act, 2015, which closed on September 30, 2015. It said that an amount of about Rs 2,476 crore was collected by way of tax and fine in such cases.
According to The Telegraph report, without providing the information sought by Britas, the government has given only general terms about the procedures followed to deal with foreign exchange violations and the laws passed and the investigative units set up to curb black money abroad. Outlined in
