New Delhi: India will be able to access banking information from Switzerland in specific cases beginning 1 April, 2011, Parliament was told on Tuesday.
India and Switzerland had signed an agreement on 30 August, 2010 to amend the Double Taxation Avoidance Agreement (DTAA) to facilitate exchange of information between the two countries.
“The amended DTAA (with Switzerland) will enable India to get banking information in specific cases for a period beginning 1 April, 2011 and thereafter”, minister of state for finance S S Palanimanickam told the Rajya Sabha in a written reply.
The revised DTAA with Switzerland was signed by finance minister Pranab Mukherjee and Micheline Calmy-Rey, head of Swiss Federal Department of Foreign Affairs.
While the India has completed the formalities for implementation of the revised DTAA, Switzerland has yet to ratify the agreement, Mukherjee said in reply to another query.
“The Amending Protocol will enter into force on completion of the internal process by Switzerland. Switzerland has informed that they have still not completed their internal process as the Amending Protocol has yet not been ratified by their Parliament”, Mukherjee said.
The revised DTAA, according to Palanimanickam, will, “specifically provide for exchange of banking information as well as information without domestic interest”.
The Amending Protocol, he added, “contains a provision wherein the requesting state has to provide the name of the person under examination or investigation and, if available, other particulars facilitating that person’s identification such as address, date of birth, marital status and tax identification number.”
The revised agreement with Switzerland , however, will not allow “fishing expeditions”, a term used for seeking general information.
“The Amending Protocol also provides that these clauses contain important procedural requirements that are intended to ensure that fishing expeditions do not occur. Nevertheless they need to be interpreted in order not to frustrate effective exchange of information”, the minister added.
Pointing out the government does not have any verifiable information on the total amount of money deposited in Swiss banks by Indian nationals, Palanimanickam said the finance ministry was getting a fresh study done on unaccounted income and wealth within and outside the country.
“The proposal (of study) was approved by the government in January 2011. The study is likely to be completed within a timeframe of 18 months”, he added.
The government is committed to tax undisclosed income of Indian residents within and outside the country, the minister said, adding “this also include undisclosed deposits in other countries including Switzerland. Since this in an on-going process, no time frame can be fixed for the same”.