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MUMBAI: The Income Tax (I-T) department will start criminal proceedings for concealment of income against Hasan Ali Khan, the Pune-based owner of race horses who is wanted for money-laundering deals worth billions of dollars and tax evasion.
I-T officials will lodge a complaint for concealment of income in a court in Mumbai and then forward the documents to the Swiss government in yet another bid to ask for information about Khan's banking transactions in
that country.
This will be the third attempt by the I-T department to convince the Swiss about the need for Indian officials to be privy to information about Khan's bank accounts. The Enforcement Directorate (ED) has also made a separate attempt. Data earlier gathered from Khan's computer showed that he allegedly had a balance of $8.04 billion in UBS Zurich at one point.
Amidst fears that Khan might leave the country, which could jeopardise cases against him, I-T officials issued a summons for him and he appeared before them at Aaykar Bhavan in Mumbai on Friday. The Supreme Court recently told
the Centre to ensure that Khan remains in India.
''In a case of concealment of income, we impose a penalty on the amount concealed. There is a provision to lodge a criminal complaint in the court,'' said a senior I-T official. The I-T department wants Khan to pay more than Rs 70,000 crore in taxes.
Director-general of I-T (Investigation) B P Gaur confirmed that the department intends to initiate criminal proceedings against Khan.
At the same time, another I-T official said that if it is proved that the documents recovered from Khan are forged, the I-T case may not stand. These are the same documents that were earlier provided to Swiss officials to prove his Swiss bank transactions, another official said. UBS Bank had said on Thursday that the documents are forged. The banks officials said they do not have any business relationship with Khan and he does not have any accounts or assets with them. Khan is suspected of transferring $8 billion from a Swiss bank using his wife Rheema's name.
Swiss authorities suspected forgery when the ED approached them with documents in 2008. The ED said Khan had committed an offence under the Prevention of Money Laundering Act (PMLA). Sources said the parameters set for invoking PMLA were not fulfilled by the ED and hence Swiss authorities refused to provide any details. To book a case under PMLA, an Indian Penal Code offence has to be registered.
Soon after, the I-T department filed a criminal complaint against Khan for not filing returns, but the Swiss refused to assist, saying not filing returns in India is not an offence in Switzerland. The I-T department then sought information about Khan's bank account under the Double Taxation Avoidance Agreement. Under the agreement, being a resident of India, Khan's global income would be taxable here. However, Swiss authorities again refused, saying it was a banking issue, an official said. I-T officials said they have raised a tax demand in the belief that the documents on Khan are genuine. ''We have that provision in the Income Tax Act,'' an official said.
Officials said his known properties are worth only a few crores. ''If we attach them and auction them off the amount realized would be far less than his dues,'' said an official.
The SC's remarks had come during the recent hearing of a case filed by Ram Jethmalani, who has alleged that little has been done to recover Rs 70 lakh crore in black money stashed abroad. The government has said that Jethmalani's estimate is unreliable.
I-T officials will lodge a complaint for concealment of income in a court in Mumbai and then forward the documents to the Swiss government in yet another bid to ask for information about Khan's banking transactions in
that country.
This will be the third attempt by the I-T department to convince the Swiss about the need for Indian officials to be privy to information about Khan's bank accounts. The Enforcement Directorate (ED) has also made a separate attempt. Data earlier gathered from Khan's computer showed that he allegedly had a balance of $8.04 billion in UBS Zurich at one point.
Amidst fears that Khan might leave the country, which could jeopardise cases against him, I-T officials issued a summons for him and he appeared before them at Aaykar Bhavan in Mumbai on Friday. The Supreme Court recently told
the Centre to ensure that Khan remains in India.
''In a case of concealment of income, we impose a penalty on the amount concealed. There is a provision to lodge a criminal complaint in the court,'' said a senior I-T official. The I-T department wants Khan to pay more than Rs 70,000 crore in taxes.
Director-general of I-T (Investigation) B P Gaur confirmed that the department intends to initiate criminal proceedings against Khan.
At the same time, another I-T official said that if it is proved that the documents recovered from Khan are forged, the I-T case may not stand. These are the same documents that were earlier provided to Swiss officials to prove his Swiss bank transactions, another official said. UBS Bank had said on Thursday that the documents are forged. The banks officials said they do not have any business relationship with Khan and he does not have any accounts or assets with them. Khan is suspected of transferring $8 billion from a Swiss bank using his wife Rheema's name.
Swiss authorities suspected forgery when the ED approached them with documents in 2008. The ED said Khan had committed an offence under the Prevention of Money Laundering Act (PMLA). Sources said the parameters set for invoking PMLA were not fulfilled by the ED and hence Swiss authorities refused to provide any details. To book a case under PMLA, an Indian Penal Code offence has to be registered.
Soon after, the I-T department filed a criminal complaint against Khan for not filing returns, but the Swiss refused to assist, saying not filing returns in India is not an offence in Switzerland. The I-T department then sought information about Khan's bank account under the Double Taxation Avoidance Agreement. Under the agreement, being a resident of India, Khan's global income would be taxable here. However, Swiss authorities again refused, saying it was a banking issue, an official said. I-T officials said they have raised a tax demand in the belief that the documents on Khan are genuine. ''We have that provision in the Income Tax Act,'' an official said.
Officials said his known properties are worth only a few crores. ''If we attach them and auction them off the amount realized would be far less than his dues,'' said an official.
The SC's remarks had come during the recent hearing of a case filed by Ram Jethmalani, who has alleged that little has been done to recover Rs 70 lakh crore in black money stashed abroad. The government has said that Jethmalani's estimate is unreliable.
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