Can I-T share overseas black money info with ED? With permission, says CBDT

Topics CBDT | Black money

Illustration by Binay Sinha
Information obtained by the income tax department on overseas black money probes through foreign tax treaties is "confidential" and can only be shared with other agencies after getting consent from the corresponding country, the CBDT has said in a latest directive.

It has also asked the taxman to guard against unauthorised disclosure of such information as it is a "serious matter".

The Central Board of Direct Taxes (CBDT), that frames policy for the I-T department, issued a directive on Wednesday stressing on the confidentiality clause that has to be maintained vis-a-vis information obtained from foreign jurisdictions as part of various tax treaties between India and other nations.

The major tax treaties are categorised as: Double Taxation Avoidance Agreement (DTAA), Tax Information Exchange Agreements (TIEAs) and the Multi-lateral Convention on Mutual Administrative Assistance in Tax Matters (MAC).

"It is India's sovereign obligation to keep the information obtained through the exchange of information (EOI) process of tax treaties with other jurisdictions confidential. Any disclosure of the information received under tax treaties with unauthorised persons, either intentionally or by accident, is a serious matter," the directive, accessed by PTI, said.

The field authorities, it added, are, therefore, required to take all steps to ensure that the information received under tax treaties is not disclosed inappropriately.

"This is necessary for continued cooperation in the EOI process from our treaty partners," it said.

The directive went further to say that the confidentiality provisions of tax treaties also prohibit the use of exchanged information for "non-tax purposes" without the express consent of the competent authority of the sending jurisdiction.

"Thus, the information received under tax treaties cannot be used for enforcement of any law other than the laws concerning taxes covered by the relevant tax treaty." "The information received can only be shared with any other law enforcement agency such as the Enforcement Directorate and CBI after obtaining consent from the competent authority of the sending jurisdiction," it said.

CBDT directed that the investigation or assessment wings of the department should first seek permission from the CBDT, through its foreign tax and tax research division, in case they want such information to be shared with their sister investigative agencies from money laundering or corruption angle.

"These instructions may be brought to the notice of all officers in your region for strict compliance," it said in its communication addressed to field offices of the department across the country.

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel