By TIOL News Service

NEW DELHI, OCT 18, 2014: FEELING elated by the outcome of the talks between the Indian and Swiss Revenue authorities the Union Finance Minister, Mr Arun Jaitley, said that the Swiss Government has agreed to furnish information on Indians having illicit money in Swiss Banks provided independent evidence is furnished by India in each case.

The biggest breakthrough which is believed to have come out this bilateral dialogue is that the Swiss authorities have agreed to share information about the names figuring on the HSBC stolen data provided to India by the French Revenue.

The four significant outcomes which are being listed out from India's perspective are:

++ Switzerland has indicated willingness to provide information in respect of cases where investigations have been carried out by our IT Department independently from what Swiss Government considers as stolen data.

This development is very significant because there are a number of cases of account holders included in the HSBC list which were investigated by our Income Tax Department independent of the HSBC list obtained from the French Government. Earlier, the Swiss Government had not agreed to provide any information on names which were included in the HSBC list on the ground that these were stolen data and have been obtained in breach of Swiss law.

++ The Swiss Federal Tax Administration has agreed that their competent authority would assist India in obtaining confirmation of genuineness of bank documents on requests by the Indian side and also swiftly provide information on requests relating to non-banking information.

This willingness on the part of the Swiss authorities would help in our tax investigations.

++ The Swiss authorities have also agreed to provide the requested information in a time bound manner or else indicate the reasons why the cases cannot be answered within the agreed timeline.

++ Switzerland has also assured that they would commence talks with India for concluding an Automatic Exchange of Information (AEOI) Agreement between India and Switzerland at the earliest, after completion of their domestic procedures. This is the first time that Switzerland has agreed to commence discussions on a bilateral agreement on AEOI.

In a related development back home, the Union Government yesterday sought clarifications from the Apex Court on the following issues:

++ Clarify that despite laying down the general principle that “no treaty can be entered into or interpreted, such that constitutional fealty is derogated from”, this Court has not prohibited the Government of India to enter into a treaty wherein a commitment may be made by the Government to maintain the confidentiality of information received as per international standards

++ Clarify that right to privacy is an integral part of right of life and accordingly information received under a tax treaty cannot be disclosed even under a proceeding under Article 32(1) of the Constitution unless there is prima facie evidence of wrongdoing which can be based on complaint filed by the Income Tax Department in a Competent Criminal Court, or a public court, for launching Prosecution for Tax Evasion

++ Clarify that as per International Standards on maintaining confidentiality, the information is public when quoted in public court proceedings arising out of tax related issues arising from complaints, prosecutions, etc in a Competent Court and only that information which the tax authorities choses to produce in the Court to substantiate its case. Once the information becomes public this way, the same can be accessed by other law enforcement agencies and/or can be made available to public at large at the discretion of the said Court.

Although the SC is going to hear it on October 28 the North Block has meanwhile said that if the Government of India is not able to give a commitment to maintain confidentiality of information exchanged under tax treaties as per international standards, including under the new global standards for automatic exchange of information, it will not receive information about Indians hiding their money in other countries including offshore financial centers and tax havens through multilayered entities with non-transparent ownership. Thus the clarification sought is to facilitate collection of information about illegal money stashed abroad.