The Punjab and Haryana High Court has dismissed the petitions of former Punjab Chief Minister Captain Amarinder Singh and his son Raninder Singh, clearing the path for the Enforcement Directorate (ED) to examine documents in possession of the Income Tax Department as part of its probe into alleged hidden foreign assets.
The case originates from information shared by French authorities with India in 2011 under the Double Taxation Avoidance Agreement. These records, often described as “master sheets,” indicated that the two were beneficiaries of offshore entities and assets, including a Swiss bank account and a Dubai property linked to the Jacaranda Trust. Relying on this material, the Income Tax Department filed complaints in 2016 accusing them of concealing overseas assets and furnishing false statements.
The petitioners argued that allowing the ED to inspect these records would violate the confidentiality clause under Article 28 of the Indo-French tax treaty, which restricts disclosure of such information to third parties. They maintained that the ED, not being a party to the agreement, could not be granted access. On the other hand, the ED submitted that it was only seeking to inspect judicial documents already placed before a magistrate, and that such inspection was legally permissible and necessary for carrying out an investigation under the Foreign Exchange Management Act.
The Court rejected the contention of the petitioners, observing that secrecy under the treaty was not absolute. Once the Income Tax Department had placed the documents before a judicial forum, they became part of the record, and there was no legal bar on the ED examining them for investigative purposes. The Court emphasized that the bar on disclosure was directed at public dissemination, not at statutory bodies conducting lawful investigations. It also noted that the Income Tax authorities themselves had raised no objection to the ED’s request, and the petitioners could not invoke the treaty provisions to resist scrutiny.
The Court upheld the earlier orders of the Ludhiana magistrate and the Revisional Court, describing them as well-reasoned and free from error. It clarified that the ED’s access was confined to inspection of records and not their public release. Stressing that issues of unaccounted foreign money may involve both tax evasion and possible criminal activity, the Bench remarked that denying inspection would only obstruct a legitimate investigation. Concluding that there was no legal infirmity in permitting the ED to proceed, the Court dismissed the petitions filed by Amarinder Singh and his son.
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