Bangladesh opposition leader Dr Kamal Hossain and his daughter Sara Hossain have been found concealing substantial income from foreign sources earned from legal services rendered in the country, according to domestic media reports, and many are questioning whether they will face any action for these.
According to the country’s top television channel, Hossain has claimed involvement in several international arbitrations in 2019. Still, income from these have not been shown in his income tax returns for the relevant assessment year.
Fresh questions have arisen after a High Court order for maintenance of the status quo on the pending case against the Hossains for allegedly concealing their law firm’s income.
Experts did not also rule out the possibility of a “biased” ruling by the court, since the Hossains practiced there and were known to wield much influence.
Tax lawyer Shahnaz Parveen Dolly said: “Hossain’s most recent tax evasion transgressions appear to be his misleading the High Court Division of the Supreme Court of Bangladesh, where he practices as a senior advocate. The case concerns the allegation of the National Board of Revenue (NBR) that Hossain and his daughter, Sara Hossain, through their law firm, surreptitiously evaded more than Taka 6.85 crore in tax payments in the 2018-2019 tax year.”
Noting that there are very few instances where the High Court has interfered with the workings of a tax tribunal and quashed a case against tax assessees who have allegedly concealed their incomes from the tax authorities, she said that the Hossains are rare beneficiaries of the exercise of such powers by the High Court. “In the case of ordinary citizens, such powers are almost never exercised by the courts to protect tax dodgers.”
The crux of the case is that, for assessment year 2018/2019, the NBR found irregularities in two Standard Chartered Bank accounts, owned and operated by both the father and daughter.
For assessment year 2018/2019, the proceedings of which has now been stayed by the High Court, Hossain received $216,718.04 for which no evidence has been provided to the country’s financial watchdog or the High Court.
In the arbitration proceeding between Standard Chartered Bank (Hong Kong) Ltd and Tanzania, he and two other lawyers who worked as members of the Tribunal were paid these hefty amounts.
Moreover, he served as a member of numerous international arbitration cases, including the Iran-US Claims Tribunal, and the international tribunals dealing with maritime disputes between Malaysia and Singapore, and Guyana and Suriname. In his own curriculum vitae, Hossain list at least 18 such cases for which he was highly paid.
Under Section 17 of the Income Tax Ordinance, 1984, the total income of any assessment year of any person includes all income, from whatever source derived, which is received or deemed to be received in Bangladesh by or on behalf of such person in such year or accrues or arises to him outside Bangladesh during that year, cited another lawyer.
NBR’s former Chairman Abdul Majid, in a television interview, stressed that law is equal for everyone but any exception is regrettable.
Any income earned overseas needs to be disclosed in the tax return, he said, adding that any lack of accountability, in case there is no disclosure, raises the the risk of money laundering.
While in a writ petition, Hossain’s law firm admits to receiving payment from overseas for legal services, he stands accused of misleading the High Court Division where he practices as a senior advocate.
In a stark contrast to the lower court decision, the duo obtained a ruling from a High Court division bench of Justice Farah Mahbub and Justice S.M. Maniruzzaman, asking the government to explain why the Income Tax Appellate Tribunal decision against their firm should not be quashed.
Ironically, in the case of all other citizens, such powers are almost never exercised by the courts to protect tax dodgers, according to legal experts.
Experts are increasingly vocal that specially privileged persons like the Hossains should not be allowed to get away with concealment of their actual overseas income earned as residents in Bangladesh because that sets a bad example for tax enforcement.
“The allegations brought against Kamal Hossain and Sara Hossain by the NBR raise serious concerns about tax evasion by persons who often claim to be vanguards of equality before the law. Yet, instead of facing the allegations in an open court, these ‘above the law’ elite resort to abusing the process of the court in order to put the cases against them in deep freeze, away from the gaze of the ordinary citizens for whom the laws remain applicable,” A.K.M. Zakir Hossain, a professor at a public university, said.
Despite repeated attempts to reach out for comments, Hossain declined to talk to the media.
Hossain, an Awami League turncoat, ended up leading the opposition Jatiyo Oikyo Front, in which both BNP and the pro-Pakistan Jamaat-e-Islami were included, during the last parliament polls.
Asked about his political volte-face, his highhanded responses to the media, drew widespread condemnation from all quarters.
“How much have you taken for asking me this question,” is how he once responded, showcasing his abhorrence to facing uncomfortable questions.
Hossain’s son-in-law David Bergman is also a known pro-Pakistan propagandist who has opposed the 1971 War Crimes trials. “It won’t be farfetched to say the offensive blitz launched by Bergman against the current government surely driven by his father-in-law’s ambitions,” veteran Bangladesh watcher Sukhoranjan Das Gupta said.