INDIA Law and Practice Contributed by: Priyank Ladoia, Asif Ahmed, Pranav Tomar and Puneet Dhanoa, AZB & Partners
enforcement worldwide to locate and provision - ally arrest a person pending extradition, surren - der or similar legal action. The PCA does not have extraterritorial jurisdic - tion. However, considering the multiple MLATs, international conventions and international organisations that India is a party to, the courts in India can serve summons on foreign entities and foreign nationals. India also has multiple extradition treaties that allow persons/officials in foreign jurisdictions to be extradited to India for trial, especially in politically sensitive cases. In this regard, the Black Money Act specifical - ly deals with foreign undisclosed income and specifies that an undisclosed asset located out - side India shall be charged to tax on its value in the previous year in which such asset reaches the notice of the assessing officer. The Black Money Act provides for: • the direct assessment of the person on whose behalf or for whose benefit the undis - closed income from a source located outside India is receivable or the undisclosed asset located outside India is held; or • the recovery from such person of the tax or any other sum of money payable in respect of such income and asset. Section 38 of the Black Money Act also provides that the Tax Recovery Officer may, in a case where an assessee has property in a country or a specified territory outside India, forward a certifi - cate to the board for recovery of the tax arrears from the assessee, where the Central Govern- ment or any specified association in India has entered into an agreement with that country or territory under Section 90 or Section 90A of the Income Tax Act, or under Section 73 subsec -
tions (1), (2) or (4) of the Act (as the case may be), for the purposes of recovery of tax. The PMLA provides a wider ambit to the ED in foreign matters. The PMLA defines an “offence with cross-border implications” as meaning: • any conduct by a person at a place outside India that constitutes an offence at that place, which would have constituted an offence specified in Part A, B or C of the Schedule provided in the PMLA had it been committed in India, and if such person transfers in any manner the proceeds of such conduct or part thereof to India; or • any offence specified in Part A, B or C of the Schedule that has been committed in India and where the proceeds of crime, or part thereof, have been transferred to a place outside India, or where any attempt has been made to transfer the proceeds of crime, or part thereof, from India to a place outside India. In the definition of “proceeds of crime”, the PMLA also covers any property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a sched - uled offence or the value of any such property, or where such property is taken or held outside the country, and the property equivalent in value is held within the country or abroad. Accordingly, the PMLA contains Chapter IX – ie, Reciprocal Arrangement for Assistance in Certain Matters and Procedures for Attachment and Confisca - tion of Property. This chapter deals with: • reciprocal arrangements with foreign states; • provisions for issuing letters of request; • reciprocal arrangements for processes and assistance regarding transfer of accused persons; and
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