From stud farms to Swiss banks, it promises to be an arduous journey for the taxman, but a critical beginning has been made. Income-Tax authorities have obtained a letter rogatory from a Mumbai court to take the investigation of stud farm owner Hasan Ali Khan to Swiss banks, which were allegedly used as conduits for large unaccounted transactions.
The letter rogatory from the Mumbai metropolitan magistrate gives authorities the legal support necessary to ask the Swiss government to cooperate with the details of Khan?s accounts and transactions in Switzerland. This is seen as a test case for the revenue department in trekking the international trail in incidents of tax evasion.
Khan is being investigated over charges of evading income tax worth Rs 71,646 crore. The sum is about a fifth of the total annual direct tax receipts of the Indian government.
The stud farm owner was raided by the tax sleuths about two years earlier, but the case shot into limelight after a report was tabled in Parliament during its monsoon session. After a search of Khan?s three properties, the tax department seized 30 horses, each valued above Rs 1 crore. The case filed against him says he did not file any tax returns or pay any taxes.
The department stumbled on a laptop belonging to one Philip Anandraj, which had stamped copies of certain documents relating to transactions in Swiss bank UBS. There were also instructions to transfer money from certain UBS accounts to various persons. When questioned by the authorities, Khan could not explain these documents.
The Swiss authorities had earlier claimed that the documents found by the Indian tax authorities were forged. The tax department, pursuing the case, filed a petition on this and was awaiting the Magistrate?s order.
A letter rogatory is a formal order along with a request from the court to the competent authority in another country to help Indian authorities in its investigations.
Khan is being probed for tax evasion and hawala transactions including $8 billion in an account in UBS AG, Zurich , while his aides, Khan?s wife, one Kashinath Tapuriah (a Kolkata-based businessman) and wife Chandrika Tapuriah are being probed for tax evasion. The tax demand on Khan, as raised by the IT department is Rs 50,329 crore, his wife Rs 49 crore, Tapuriah and wife over Rs 21,000 crore and one RM Investments Rs 336 crore.