Largest Offshore Inquiry in India: Over 400 Indians under Panama Papers Scrutiny

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Out of 11.5 million leaked documents from the database of the world’s fourth largest offshore law firm- Mossack Fonseca, documents of 415 Indians are currently under scrutiny as a part of the investigation of the Panama Papers controversy. Interestingly, this investigation of alleged tax violations by the Indian community has become the largest offshore inquiry initiated in the country.

According to the Financial Express, the government has initiated investigations into 198 accounts held in 13 jurisdictions owned by Indians named in the Panama Papers. They include offshore accounts in the British Virgin Islands (BVI), Bahamas, Luxembourg, Jersey, Seychelles, Switzerland and Cyprus.

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The Foreign Tax and Tax Research (FTTR) division of the Ministry of Finance had 297 people under scanner till July this year.

After the leak, India created a Multi-Agency Group (MAG) comprising officers from various central investigative agencies like the Income Tax department, FIU, RBI and Foreign Tax and Tax Research (FT and TR) under the Central Board of Direct Taxes apart from the Special Investigation Team (SIT) for Panama Papers probe.

The Foreign Tax and Tax Research (FTTR) references sent to the BVI for details of Indians set up by Mossack Fonseca were more than any other nation. Additionally, almost half of 210,000 offshore entities listed in the Panama Papers data were incorporated in the BVI.

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Panamanian law firm- Mossack Fonseca received worldwide media attention in April 2016, when information of its clients was leaked and was later published by the International Consortium of Investigative Journalists. The firm has allegedly helped foreign citizens avoid local taxes.