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Paradise Papers: Multi-agency probe ordered into offshore links of super rich in secret tax havens

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Mumbai: The Government on Monday announced an investigation into the alleged shady financial holdings abroad of super rich Indians, including actor Amitabh Bachchan, liquor baron Vijay Mallya and Minister of State for Civil Aviation Jayant Sinha – some of the names that appear in an exposé called Paradise Papers, as revealed by the Indian Express.

The multi-agency probe will be headed by the Chairman of the Central Board of Direct Taxes with representatives from Enforcement Directorate, the Reserve Bank of India and the Financial Intelligence Unit of the Finance Ministry.

The panel will first “go through” the details of income tax returns filed by the 714 Indian individuals and entities named in the Paradise Papers and subsequently take action, on a case-by-case basis, sources said. Markets regulator Sebi will look into alleged fund diversion and corporate governance lapses of various listed firms.


Also Read: Paradise Papers leaked: Sebi lens on firms for fund diversion

One can gauge the extent of the black money menace from India’s rank –19th in terms of number of names — among the 180 countries listed in the papers. Bachchan’s name had appeared in the Panama Papers, too, the data of which was leaked in 2016. Among other individual names, that of Sanjay Dutt’s wife Manyata and controversial corporate lobbyist Niira Radia’s are prominent.

Among Congress politicians, Karti Chidambaram and Sachin Pilot’s names have appeared in the list for being associated with Ziquista Healthcare, where the two of them were Independent and Honorary Directors, respectively. Former Rajasthan CM Ashok Gehlot’s name too has surfaced in relation to this company.

Leading Indian corporates mentioned in the leaked data include Jindal Steel, Apollo Tyres, Havells, Hindujas, Emaar MGF, Videocon, the Hiranandani Group and D S Construction.

According to the Indian Express, Minister of State for Civil Aviation Jayant Sinha’s name appeared due to his past association with a company named the Omidyar Network. BJP MP RK Sinha was also named in the list for his security company’s links with two offshore companies. Sinha’s company Security and Intelligence Services has a subsidiary – SIS Asia Pacific Holdings Ltd (SAPHL) based in Malta. Sinha’s wife Rita Sinha is a director of SAPHL, while Sinha himself is a minority shareholder.

Another company named SIS International Holdings Limited, based in British Virgin Islands, holds 399,999 shares in SAPHL, while Sinha holds the remaining 1 share, the Indian Express has reported.

Sinha reportedly did not disclose his and his wife’s link with SAPHL prior to assuming the office of a Rajya Sabha MP. However, he did declare his interest in all the companies before SEBI earlier this year. When ANI asked him for his response on the leak, Sinha refused to comment, citing a ‘maunvrath’ (observation of silence).

When Veerappa Moily held a post in the UPA government, his son Harsha is said to have floated a firm which received investments from subsidiaries of the Unitus Group based in Mauritius.

Trump’s Ambassador to India Kenneth Juster was also named in the Paradise Papers, for having profited from the offshore business of his investment company Warsburg when it purchased a shipping corporation.

The ‘Paradise Papers’ is a collection of 13.4 million documents, which was first obtained by German newspaper Süddeutsche Zeitung, and was later taken up for investigation by International Consortium of Investigative Journalists (ICIJ) with 96 partner organisations. Ironically, the leak comes just two days before Indian Government observed ‘Anti-Black Money Day’, which also marks one year of demonetisation.

The website of ICIJ suggests that structured data connected to the “Paradise Papers” investigation will be released only in the coming weeks on its Offshore Leaks Database.