Panama Papers: Over 700 Indians in Paradise' expose, govt orders probe

New Delhi: A fresh expose “Paradise Papers” by the International Consortium of Investigative Journalists (ICIJ) has lifted the veil on the offshore activities of some powerful people across the word, including some Indians, in order to escape the tax net.

Over 700 Indian names, including those of politicians, corporate leaders and celebrities, figured in the leaked “Paradise Papers”, detailing business dealings in offshore tax havens. Out of the 180 countries represented in the data, India is reported to rank 19th in terms of the number of names.

After the expose, the Centre on Monday announced the setting up of a reconstituted multi-agency group (MAG) headed by the CBDT chairman to also investigate cases of the Paradise Papers, that will have members from the income-tax department, Enforcement Directorate, the Reserve Bank of India and Financial Intelligence Unit. The MAG was already investigating the earlier ICIJ leak of the “Panama Papers”, which too had revealed the names of some prominent Indians.

The CBDT said that investigation units of the income-tax department have been alerted to take note of the revelations as they are published in the coming days by ICIJ partners for immediate appropriate action.

“It has been reported that many cases of offshore entities are already under investigation on the fast track. As soon as further information surfaces, swift action as per the law will follow,” the CBDT said.

Markets regulator Sebi too will look into the alleged fund diversion and corporate governance lapses at various listed firms and their promoters as exposed by the ICIJ in the “Paradise Papers”.

Read: Panama Papers investigation has detected Rs 792 crore stash

The reports indicated that the Indian names figuring in the expose include Bollywood superstar Amitabh Bachchan, defaulter businessman Vijay Mallya, corporate lobbyist Niira Radia, filmstar Sanjay Dutt’s wife Dilnashin, Union minister of state Jayant Sinha and Rajya Sabha MP R.K. Sinha. Most of them, however, have denied any wrongdoing.

The Paradise Papers documents include nearly seven million loan agreements, financial statements, emails, trust deeds and other paperwork over nearly 50 years from inside Appleby, a prestigious offshore law firm with offices in Bermuda and elsewhere.

The leaked documents include files from the smaller, family-owned trust company Asiaciti, and from company registries in 19 secrecy jurisdictions. The Sun Group, founded by Nand Lal Khemka, figured as Appleby’s second largest client with as many as 118 offshore entities, as per the reports.

The Indian names also included those associated with the Sun-TV-Aircel-Maxis case, the Essar-Loop 2G case, the SNC-Lavalin in which Kerala CM Pinarayi Vijayan was named and then cleared, and a case against Y.S. Jagan Mohan Reddy; as well as entities linked to the Rajasthan ambulance scam that names an entity called Ziquista Healthcare (with Congress leader Sachin Pilot and former minister P. Chidambaram’s son Karti as early honorary/independent directors).

Minister of state for civil aviation Jayant Sinha said the transactions revealed in the “Paradise Papers” were legal and bona fide. Mr Sinha had worked with Omidyar Network as managing director in India and Omidyar Network had invested in a US company D. Light Design that has a subsidiary in the Cayman Islands, according to a report based on the Paradise Papers investigation. “The transactions were undertaken on behalf of highly-reputed world-leading organisations in my fiduciary role as partner at Omidyar Network and its designated representative on the D. Light board,” the minister said. “It is crucial to note that these transactions were done for D. Light as an Omidyar representative, and not for any personal purpose,” he noted. Mr Sinha, who is a former venture capitalist, also said all these transactions had been fully disclosed to the relevant authorities through all necessary filings as required. “After leaving Omidyar Network, I was asked to continue on the D. Light Board as an independent director...

On joining the Union council of ministers, I immediately resigned from the D. Light board and severed my involvement with the company,” the minister said.

Mr Bachchan too wrote a long blog on Sunday, hours before the “Paradise Papers” were published, explaining that he had always cooperated with the “system”, even though he did not directly refer to the latest leaks.

The CBDT said, meanwhile, that the names of only a few Indians (legal entities and individuals) had appeared so far in the media. “Even the ICIJ website has not yet released the names and other particulars of all the entities. The website of ICIJ suggests the information will be released in phases and structured data connected to the Paradise Papers investigation will be released only in the coming weeks on its Offshore Leaks Database,” it added.

The files were obtained by the German newspaper Süddeutsche Zeitung and shared with ICIJ. The new expose comes 18 months after the Panama Papers.

The ICIJ, however, put out a disclaimer that “there are legitimate uses for offshore companies and trusts”, and it does not “intend to suggest or imply that any people, companies or other entities included in the ICIJ Offshore Leaks Database have broken the law or otherwise acted improperly”. The ICIJ also said many people and entities may have similar names and suggested that the identities of those named in the database should be confirmed on the basis of addresses or other identifiable information.