The Hush Post:  Ludhiana: Paradise Papers are a new treasure of information on the offshore banking. So what is this offshore banking? It is akin to a grown-up rich man’s wallet abroad similar to a child’s in a friend’s place to escape his dad noticing it.

There are names of 714 Indians in the list. Some of these names are Dilnashin, also known as Manyata Dutta, Sanjay Dutt’s wife; Minister of Civil Aviation, Jayant Shah; Sachin Pilot, Karti Chidambaram, BJP MP Ravindra Kisore Sinha; Bollywoood superstar Amitabh Bachchan, Vijay Mallya, corporate lobbyist Nira Radia among many others. The Centre has decided to set up a multi-agency group headed by the Central Board of Direct Taxes (CBDT) Chairman, other representatives too from the CBDT, the Enforcement Directorate, the RBI and the Financial Intelligence Unit, which will oversee the investigations into the Paradise Papers. With more than 700 Indian names, mostly corporate entities, figuring in the leak mainly from two firms, Bermuda’s law firm Appleby and Singapore’s family-owned trust company Asiaciti, Indian tax authorities will have to dig deep into the offshore banking and take action against those involved in any wrongdoing.

Offshore banking is allowed in India since 2004, provided the tax authorities know where the money invested offshore came from. However, not sharing information about one’s business and thus avoiding tax and investing that money offshore is illegal. In other words, it amounts to hiding information.

What are Paradise Papers?

These are a set of 13.4 million confidential electronic papers related to offshore banking. These were first leaked to the German newspaper Suddeutsche Zeitung.  The details were made public in the first week of November this year. The documents come from the offshore law firm Appleby, the corporate services providers Estera and Asiaciti Trust. They contain the names of more than 1,20,000 people and companies.

The present laws in India allow a corporate entity or individual to take measures to lessen one’s tax by investing internationally, but with the knowledge of tax authorities. With the Paradise Papers expose, the tax authorities will have to ascertain whether the permission from the RBI was taken before investment. They will also investigate whether the Indian parties submitted proper reports to the RBI as required under the law.

What is Appleby?

Like Mossack Fonseca of Panama Papers’ fame, Appleby is a ‘corporate and law’ service firm which helps individuals and corporates float money internationally to evade taxes.


Shamsher Chandel, The Hush Post: It is basically clever banking. To understand it like a child, offshore banking is like collecting not just your pocket money and putting it into your wallet, it also includes stealing money from your dad’s wallet from time to time and then parking that money in another wallet in your friend Pranay’s place in the neighbourhood.

Your dad will never know how much stolen money you have. In a similar fashion, if you teach this skill to a couple of other friends, say Aryan, Harjot, Rajul and Dilsher, they too can pilfer from their dad’s pocket and park the money at Pranay’s place. This place is a haven for all such friends because Pranay’s parents are non-interfering and do not poke their nose in their son’s life. You can almost compare Pranay’s place to countries like Macedonia, Bermuda and Bahamas. Thus Pranay’s wallet keeps growing fat. Then one day, Prannay’s dad finds in the closet a wallet which has more money than his. After further scrutiny, he calls up every child’s parents. The Paradise Papers’ leak is pretty much the same. All the children got embroiled after Pranay’s dad called their parents. Though, not everybody had parked for a wrong reason. Harjot wanted to park money to surprise his younger sister with an expensive birthday gift; Rajul wanted a safe hiding place away from the prying eyes of his brother. But, Aryan and Dilsher had simply parked stolen money.

Now the fact is that, many rich and famous people in real life too were just caught hiding their wallets at Pranay’s house, let us say, in the paradise of the Bermudas and Macedonias. Their dads (various countries and tax authorities) have found out. Not all are in the wrong. But some definitely are.