Responding to an article published in The Pioneer dated July 13 under the title “India’s Panama paper on shell firms, tax loopholes gather dust” involving 1.5 GB Data leakage of legal and tax consultancy firm Nishith Desai Associates, Nishith Desai on Tuesday said that “there is absolutely no illegality in anything that we or our clients have done”.
In an email to The Pioneer, Desai claimed that the foreign funds mentioned in the report are all globally renowned funds who pool funds from different jurisdictions for investment in portfolio companies after doing thorough KYC and after compliance with applicable laws.
“There is absolutely no illegality in anything that we or our clients have done. They are all globally renowned funds who pool funds from different jurisdictions for investment in portfolio companies after doing thorough KYC and after compliance with applicable laws. They need a neutral jurisdiction for pooling vehicles which provides flexibility in terms of enforceability of contracts, simplified corporate laws, robust bilateral investment protection treaty with India, etc.
All investors in these pooling vehicles disclose and pay taxes in their home jurisdictions including in India as required by law.
“The Supreme Court of India has upheld validity of use of jurisdictions such as Mauritius for investment into India. It’s a public knowledge that even Unit Trust of India (a Government of India undertaking) had legitimately used Guernsey to pool global investors for mobilising investments in India. Now, India has set up Gujarat International Financial and Technology City (GIFT) to provide tax neutrality and actively promotes global asset managers to set up funds there. As has been noted by the Supreme Court, India has greatly benefited by increased flow of foreign investment from these funds,” said Desai accusing whistle blower Pankaj Jain of tarnishing his reputation and illegally accessing his client information.
“The Court has already issued restraint orders from sharing the data which has illegally come into his possession. Since the matter is sub-judice, it would not be appropriate for us to make further statements,” said Desai reiterating that his firm’s advices to clients were always consistent with applicable laws and ethical standards.