M A I N   N E W S

After SC rap, Cabinet meets to discuss black money issue
Anita Katyal
Our Political Correspondent

New Delhi, January 20
Already battered by a series of scams and scandals, a worried government today turned its attention to the gathering storm over the flak it is facing from the Supreme Court over black money stashed away in Swiss banks. The weekly Cabinet meeting today took note of the matter when Prime Minister Manmohan Singh personally drew attention to it during a discussion on the agreement that India proposes to sign with Cayman Islands (a tax haven) for exchange of information relating to taxes. The PM is learnt to have referred to the Supreme Court’s observation that black money is a “ mind boggling theft of national wealth” which had hit the headlines and turned to Finance Minister Pranab Mukherkee for details. UPA sources said there was overall concern at the Cabinet meeting that the government is lurching from one crisis to another and the general perception is that the Centre has either lost the will or is helpless in stamping out corruption. Mukherjee gave details of the efforts being made to unearth the black money and explained that the government was unable to reveal the identity of persons who have black money accounts in foreign banks as the information is given to them in accordance with international treaties purely for taxation purposes. If the government started revealing the names, no country would share this information with India in future, he said.

Worried that this issue could snowball into yet another controversy like the 2G spectrum scam or the Commonwealth Games fiasco, it was decided that Mukherjee would soon address a press conference to clarify matters and explain how the government is pursuing the black money trail.

In this connection, the Finance Minister said this is a painstaking exercise and cited the example of the difficulties the government has encountered while tracking the case of Pune-based Ali Hasan, who is alleged to have put away Rs.600 crore in foreign bank accounts. Mukherjee also questioned the figures which are being bandied around with regard to the amount of black money which is stashed abroad and said these were highly exaggerated.

The Finance Minister told his Cabinet colleagues that the real objective of signing these treaties with other countries was to collect unpaid taxes, adding that the government would pursue the cases of tax evasion without disclosing the names o the account holders.

The Prime Minister had made the same point in his brief interaction with media persons yesterday at the Rashtrapati Bhavan. He said the government had got “some information” about black money accounts for use in the collection of due taxes but was the it was unable to disclose the names of the account holders.

“We cannot use the information for any other purposes and that information cannot be made public as the country cannot violate the obligations under international treaties,” he underlined.

Can’t give details: PM