Hasan Ali black money probe hits roadblock - The New Indian Express

Hasan Ali black money probe hits roadblock

Published: 25th October 2013 09:07 AM

Last Updated: 25th October 2013 09:07 AM

The search and seizure of Hasan Ali Khan’s $8 billion unaccounted money allegedly stashed in the Zurich branch of the United Bank of Switzerland (UBS) is facing a major hurdle, as Income-Tax authorities failed to gather enough evidence to launch prosecution against Swiss bank officials.

In his opinion to the Central Board of Direct Taxes (CBDT), Attorney General GE Vahanvati said the tax investigators had failed to provide enough material suggesting abetment on part of the officials of the UBS in filing false tax returns of Khan. He also cautioned the authorities that any such decision of launching prosecution must only be taken after enough material was gathered that prima facie suggested abatement or inducement by officials of the bank. Vahanvati said he did not find any material in the file referred to him suggesting such abatement or inducement on part of the officials.

The CBDT had sought Vahanvati’s opinion as to whether prosecution under various Sections of the I-T Act was possible in the case of the bank based on evidence gathered on its role in abetting Khan in filing false tax returns.

The UBS officials had refused to acknowledge the documents seized from Khan’s residence, but confirmed that only three accounts were opened with the bank in July 2001 and subsequently they were closed in October 2011. The AG has asked the tax authorities to prove that the bank’s response was false and it was intended to assist Hasan Ali Khan to evade tax.

The I-T Department in Mumbai had raised a tax demand of `89,000 crore on Khan and his associates and a probe was launched after a raid on his premises in January 2007. The I-T and ED officials had earlier charged that the UBS was not cooperating with the investigation into Khan’s account which was used to launder black money. Khan is also facing a case under Prevention of Money Laundering Act (PMLA).

Sources said Letter Rogatory (LR) was sent to Singapore, the UAE, Switzerland and the UK to prepare a watertight case against Khan and his aides. Although, agencies had tracked $7 lakh transaction from the US to an account in the UK, the UBS was reluctant to share any information with Indian agencies.

Similarly, no help came from the UBS to unravel the complex web of money laundering Khan did by laundering ill-gotten wealth through his accounts in the banks in Zurich and Singapore.

ED officials said that arms dealer Adnan Khashoggi had assisted Khan in opening bank account abroad.

“However the UBS raised the question over genuineness of the documents and said it could be forged,” officials said.

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