Raghav Bahl writes to Finance Minister, urges a culture of self-correction in CBDT  

LETTER TO FINANCE MINISTER

Subject: Voluntary disclosure of further relevant information about the purchase of London property from the tax-paid income of self and immediate family, demonstrating that there is no reason or basis for authorities to waste any further time and resources to investigate any instance of money laundering and/or black money which is non-existent; and under even any far-fetched pretence such investigation cannot be continued except by way of gross abuse of due process and law

Dear Nirmala ji,

This is in continuation of my letter dated 8 June 2019 addressed to your good self.

In summary,

• It is my hope that by voluntarily disclosing the information below, I can facilitate the inquiries of the ministry and its departments and provide them with an opportunity to correct the mistakes and errors committed by them thus far.
• The disclosures below should remove any iota of doubt and demolish even the remotest pretence to continue with any probe or investigation as, along with the material information provided earlier, they clearly establish that every penny (quite literally) invested to buy the property in London which has become the subject of investigation, has been paid through the incomes of myself and my immediate family members.
• All taxes on these incomes have been duly paid, all details about these incomes have been duly disclosed as required by law and the amounts of money are definitely and conclusively not from the proceeds of black money.

I am writing this because in my decades of experience covering governments, regardless of political affiliation, the attitude of the bureaucracy to not admit any mistakes or correct any error, even after these have become known, remains a constant. As there is personal immunity for official conduct, the practice followed by bureaucratic officers is to let the judiciary grant relief if an aggrieved person approached the courts, and to oppose even that, no matter the merits of the case. This practice does not merely result in harassment of individuals, but also wastes the precious time and energy of the government and takes resources and attention away from core issues of governance, besides clogging the judicial system.

The information provided below goes beyond the scope of questions put to me through the show cause notices from the Income Tax Department dated 1 May 2019, and amounts to a voluntary disclosure of information that should put to rest even the remotest curiosity or reason about my investments relating to a property in London. All payments relating to this property have gone through banking channels, from duly tax paid earnings, and within the limits specified by the Reserve Bank of India, and this information should demonstrate that the allegations by the authorities are nothing but a wild goose chase.

Not only that, I am expediting the filing of my current IT return (even though statutorily I have still further time to do so) so that each and every transaction related to the acquisition of this fully disclosed property in London is available on record well in advance, including payments made but not covered in the show cause notices dated 1 May 2019. I have nothing to hide as I have followed the law and committed no misdemeanours, and I want the State to respect this, and allow me to go about  my professional journalistic responsibilities and personal life in an unhindered manner, as guaranteed by the Constitution.

As stated earlier, this should also help the government and the relevant departments to pursue real cases and issues in furtherance of public interest and in the interest of the State’s revenue, and thereby promote probity, integrity and honesty.

Further to these considerations, I am recording  below the full details of the monies paid till date for the property at issue, through tax paid income and a loan, including the entire source of money for the purchase, as well as the formation and structure of a trust and a company to plan a smooth succession for the property in question. The company and trust are composed solely of close and immediate family members as settler, protector and beneficiaries and are managed by one of the most respected international management companies, and no revenue interests of the government of India have been harmed in making these succession planning structures.

Disclosures:

• Ms. Ritu Kapur settled a family trust under the name of ‘RB Trust’ in the Isle of Man.  In this regard, Ms. Ritu Kapur settled USD 98,333 in the RB Trust. Ms. Ritu Kapur availed the applicable limits under the Liberalized Remittance Scheme (LRS) of the Reserve Bank of India to settle the aforesaid sum in the RB Trust. Summarised hereunder are the other key facts regarding RB Trust:

Protector: Mr. Raghav Bahl

Potential Beneficiaries: Mr. Raghav Bahl, Ms. Tara Bahl and Mr. Vidur Bahl

Trustee: Trust Company (Isle of Man) Limited

• RB Trust owns 100% of the equity share capital of a company incorporated in the Isle of Man – ‘RBRK Investments Limited’.  The 100% equity share capital of this company is represented by two equity shares of GBP 1 each.
• From 2015 to the present, Mr. Raghav Bahl along with the following family members remitted a total of USD 2,880,848 and GBP 506,900 to RBRK Investments Limited against issuance of Cumulative Redeemable Preference Shares.  The details of the remittances made by Mr. Raghav Bahl and his family (the sources of which include, inter alia, duly disclosed gifts between family members) to RBRK Investments Limited is as under:

• Mr. Raghav Bahl and Ms. Tara Bahl had directly paid GBP 272,500 each from the abovementioned remittances in relation to the purchase of the property in London at issue.  However, in November 2017, Mr. Raghav Bahl and Ms. Tara Bahl had assigned their interest in the property in London to RBRK Investments Limited.  Accordingly, RBRK Investments Limited issued Cumulative Redeemable Preference Shares worth GBP 272,500 each to Mr. Raghav Bahl and Ms. Tara Bahl.
• In addition, RBRK Investments Limited availed a loan of GBP 2,043,750 from Bank Plc. London after this was sanctioned by the bank in July 2018 to complete the final payment for purchase of the London property. The entire loan amount is presently outstanding.
• Hence, the total purchase cost of the London Property is GBP 2,861,250, which has been funded as under:

• In addition, Mr. Raghav Bahl and Ms. Ritu Kapur made payments of GBP 224,321 and GBP 116,037 respectively towards legal expenses, renovation, furniture and fittings, etc. for the said property in London.

Hence, it is amply clear, that the entire funds used in relation to the acquisition of the property in London and related expenses (legal, renovation, furniture and fittings, etc.) were:

• sent by Mr. Raghav Bahl and his family from India through normal banking channels; and
• availed as a loan from Bank Plc, London.

In order to bring further clarity, a flow chart is also annexed to explain each and every transaction.

In light of the above disclosures, and the mandate of robust political leadership that you are known for, I hope and trust that you will direct the bureaucracy to usher in  a culture of self-correction and, subject to judicious application of mind, examine this material and drop the proceedings against me for having no basis and substance.

I am confident that such an approach would ensure that law-abiding citizens like myself do not need to burden the court system to secure justice.

Further to my existing cooperation with the authorities, I also undertake to ensure that any documents or clarifications required by you or the departments concerned will be made available without delay.

With my warm personal regards,

Raghav Bahl