Lok Sabha Question No. 4971 (UNSTARRED), answered on 2016-12-16
Subject: Automatic Exchange of Information
Ministry: FINANCE
Asked by: SUNIL BALIRAM GAIKWAD, KUNWAR HARIBANSH SINGH, SUDHEER GUPTA, VIJAY KUMAR S.R., T. RADHAKRISHNAN, ASHOK SHANKARRAO CHAVAN, BIDYUT BARAN MAHATO, GAJANAN CHANDRAKANT KIRTIKAR

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE

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## LOK SABHA UNSTARRED QUESTION NO. 4971

## TO BE ANSWERED ON FRIDAY, THE 16 TH  DECEMBER, 2016

AGRAHAYANA 25, 1938 (SAKA)

## AUTOMATIC EXCHANGE OF INFORMATION

4971. DR. SUNIL BALIRAM GAIKWAD:

KUNWAR HARIBANSH SINGH:

SHRI SUDHEER GUPTA:

SHRI S.R. VIJAYAKUMAR:

SHRI T. RADHAKRISHNAN:

SHRI ASHOK SHANKARRAO CHAVAN:

SHRI BIDYUT BARAN MAHATO:

SHRI GAJANAN KIRTIKAR:

Will the Minister of FINANCE be pleased to state:

- (a) whether India and Switzerland have signed an agreement for automatic exchange of information recently;
- (b) if so, the details thereof along with the terms and conditions of the agreement;
- (c) the time by which the said agreement is likely to come into force;
- (d)  the  details  of  the  countries  with  which  the  Government  has  signed  similar agreement; and
- (e) the further steps taken/being taken by the Government to check the menace of stashing India's black money in other countries?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI SANTOSH KUMAR GANGWAR)

(a) to (c):  India ratified Multilateral Convention on Mutual Administrative Assistance in Tax Matters (MAC) in June 2012 and has also signed the Multilateral Competent Authority  Agreement  on  Automatic  Exchange  of  Financial  Account  Information (MCAA) based on Common Reporting Standards (CRS) on 3rd June, 2015. India and Switzerland signed the 'Joint Declaration' for implementation of Automatic Exchange of Information (AEOI) on the 22nd November, 2016. Through this Joint Declaration, both the jurisdictions intend to introduce on a reciprocal basis automatic exchange of financial  account  information  between  each  other  beginning  in  the  year  2018  (first transmission of data in 2019). The Joint Declaration is subject to MAC being in force in each jurisdiction, signing of MCAA by both jurisdictions, notification of each other under section 7(1)(f) of the MCAA and adequate confidentiality and data safeguards in each jurisdiction.

(d):      India  has  already  signed  the  MCAA  and  has  under  section  7(1)(f)  of  MCAA conveyed  to  the  Coordinating  Body  its  list  of  intended  exchange  partners  which includes all the signatories of MCAA.

(e): The Government has taken several steps to effectively tackle the issue of black money, particularly black money stashed in other countries. Such measures include policy-level  initiatives,  more  effective  enforcement  action  on  the  ground,  putting  in place robust legislative and administrative frameworks, systems and processes with due focus on capacity building and integration of information and its mining through increasing  use  of  information  technology.  Recent  major  initiatives  in  this  regard include  -  (i)  Constitution  of  the  Special  Investigation  Team  (SIT)  on  Black  Money under  Chairmanship  and  Vice-Chairmanship  of  two  former  Judges  of  Hon'ble Supreme  Court,  (ii)  Enactment  of  a  comprehensive  law  -'The  Black  Money (Undisclosed  Foreign  Income  and  Assets)  and  Imposition  of  Tax  Act,  2015'  which has come into force w.e.f. 01.07.2015 to specifically and more effectively deal with the  issue  of  black  money  stashed  away  abroad,  (iii)  Constitution  of    Multi-Agency

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Group  (MAG)  consisting  of  officers  of  Central  Board  of  Direct  Taxes  (CBDT), Reserve Bank of India (RBI), Enforcement Directorate (ED) and Financial Intelligence Unit (FIU) for investigation of recent revelations in Panama  paper  leaks,(iv) Proactively engaging with foreign governments with a view to facilitate and enhance the exchange of information under Double Taxation Avoidance Agreements (DTAAs)/Tax Information Exchange Agreements (TIEAs)/Multilateral Conventions, (v) According high priority to the cases involving black money stashed away abroad for investigation and other follow-up actions including prosecutions in appropriate cases, (vi)  While  focusing  upon  non-intrusive  measures,  due  emphasis  on  enforcement measures in high impact cases with a view to prosecute the offenders at the earliest for  credible  deterrence  against  tax  evasion/black money, (vii) Proactively furthering global efforts to combat tax evasion/black money, inter alia, by joining the Multilateral Competent  Authority  Agreement  in  respect  of  Automatic  Exchange  of  Information (AEOI)  and  having  information  sharing  arrangement  with  USA  under  its  Foreign Account  Tax  Compliance  Act  (FATCA),  (viii)  Renegotiation  of  DTAAs  with  other countries to bring the Article on Exchange of Information to International Standards and expanding India's treaty network by signing new DTAAs and TIEAs with many jurisdictions to facilitate the exchange of information and to bring transparency, (ix) Enabling attachment and confiscation of property equivalent in value held within the country where the property/proceeds of crime is taken or held outside the country by amending the Prevention  of  Money-laundering  Act,  2002  through  the  Finance  Act, 2015, (x) Enactment of the Benami Transactions (Prohibition) Amendment Act, 2016 to amend the Benami Transactions (Prohibition) Act, 1988 with a view to, inter alia, enable confiscation of Benami property and provide for prosecution, (xi) Initiation of the information technology based 'Project Insight' by the Income Tax Department for strengthening the non-intrusive information driven approach  for improving  tax compliance and effective utilization of available information.

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