The government will seek a review of the Supreme Court ruling on black money, which slammed the Centre's efforts to track and retrieve illegal money parked in tax havens overseas and set up a special investigation team comprising of two retired SC judges.
Prime Minister Manmohan Singh is learnt to have discussed available legal options before his government with Cabinet colleagues and Attorney-General GE Vahanvati over the past two days and a consensus seems to have developed on seeking a review on the order.
The SC order came as a major embarrassment to the government in an environment where corruption and black money have become major national issues, thanks to influential civil society movements and opposition parties. The court set up a special investigations team comprising retired SC judges Justice Jeevan Reddy and Justice MB Shah. In the preceding months, the government had set up two committees on the subject.
In April, it set up a 10-member highlevel supervisory committee to suggest a legal framework to retrieve black money. Headed by the Revenue Secretary, it comprised Directors of CBI , Enforcement Directorate, Intelligence Bureau, Directorate of Revenue Intelligence and chiefs of Central Board of Direct Taxes , Narcotics Control Bureau, Financial Intelligence Bureau, Foreign Trade and Tax division and deputy governor of Reserve Bank of India.
Subsequently in June, the government set up another committee under the Finance Ministry's Central Board of Direct Taxes, to look into recovering tax from untraceable assessees. In its order on Monday, the SC accused the government of "serious lapses" in handling the issue and voiced concerns that black money could be used for "unlawful and anti-national" activities.
The court said that the government's efforts to locate and recover the illegal money have been half-hearted. That despite the two committees set up by the government, the SC chose to set up its own SIT, was seen as a snub to the government, one which added to the arsenal of the opposition parties that have been accusing the government of kid-gloving the offenders in the matter.
While seeking a review of the order, it is learnt that the government will plead that the high-level committee set up by it in April has not had adequate time and opportunity to proceed and it should be granted a chance to do so. With the sharp SC order finding its efforts insufficient, the government has been pushed to a corner on the matter, with little option but to be seen as serious and sincere on the matter.
With ministers battered with corruption charges and strong civil society movements against corruption and black money adding to the image deficit woes, seeking a review of the order will be the first tactical ploy in the government's efforts to be seen as proactive on the matter.
