The Income Tax Department which is a year and a half into its Panama papers probe has launched its first set of prosecutions in the investigations. As per Indian Express report, until date, 424 Indians named in the date on offshore entities set up by Panamanian law firm Mossack Fonseca have been under the scanner. As per IE report, officials of the Central Board of Direct Taxes (CBDT) said that they now have taken a big step forward and have rolled out a prosecution in five cases in different courts across India. They added that these are the cases where I-T Department was simultaneously conducting proceeding for tax violations but against whom there has been sufficient evidence have been received from among 13 foreign jurisdictions. This means that the very existence of the off-shore entity and of holdings and bank accounts by the company or Trust can be confirmed.
Furthermore, the prosecutions are filed under different sections of the I-T Act for alleged tax evasion; non-declaration of off-shore assets and for giving false statements to the Department. As per IE report, the officials have identified that provisions of the Black Money Act 2015, could be appealed later.
Meanwhile, earlier this year, ever since the last update which was given by the Central Board of Direct Taxes to Multi Agency Group (MAG), the strike rate of the Department in receiving replies from foreign jurisdictions like the British Virgin Islands (BVI), Cyprus and Seychelles has gone up. Notably, IE on March 16, 2017, reported that the number of requests sent by India stood at 283 cases which now has exceeded the 300 mark. Interestingly, the officials said, among these 240 cases, I-T department has decided to filter and concentrate on 70 “actionable” cases which are connected to the Panama Papers.