The Supreme Court on Monday appointed a high-level special investigation team headed by former apex court judge B P Jeevan Reddy to monitor the investigation and the steps being taken to bring back black money stashed away in foreign banks.

Besides Justice Reddy, who will be the chairman of the SIT, the apex court appointed its former judge, Justice M B Shah, as the vice-chairman of the panel.

A bench comprising justices B Sudershan Reddy and S S Nijjar directed that the High-Level Committee constituted by the government to look into the issue of black money would 'forthwith' be a part of the SIT.

The bench also directed the government to disclose the names of all the persons who have been issued show cause notices by the authorities in connection with the probe into the black money issue.

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The court, however, made it clear that the authorities would not disclose the names of those who have not been investigated in connection with deposits made in foreign banks, including Liechtenstein bank.

The court passed the order on a petition filed by eminent jurist Ram Jethmalani and others seeking directions to the government to track black money stashed away abroad and bring it back.

The apex court directed the government to issue notification forthwith regarding the appointment of SIT and ordered that government machinery to cooperate with it.

The bench, while passing the order, made some hard-hitting observation against the Centre for its 'failure' to take proper action against people who have illegally stashed away money in foreign banks.

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Observing the phenomenon of black money as 'extremely dangerous to the country', the court said the quantum of money in foreign banks is a rough measure of 'weakness' and 'softness' of the nation.

The bench said that it was a serious lapse on the part of the government which will have implications on the country's external and internal security.

"We must express serious reservation on the steps taken by the government. . .It's clear to us that investigation was completely stalled and expedited only after the court's intervention.

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"It was only upon this court's insistence that proper investigation was conducted," the bench said while referring to Pune stud farm owner Hasan Ali Khan's case.

"There was much to be desired," the court said, adding there was a need for it to get involved in the case.

"We hold that continued involvement of the court is necessary," the bench said, while directing the SIT to take over all the cases relating to the issue of black money and file a status report before it.

The court also asked the SIT to submit a comprehensive action plan to deal with cases relating to the black money issue.

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Justifying its decision to constitute the SIT, the bench said that in previous cases also the court has been passing such orders to fulfil its constitutional obligation.

The court also said that it's not possible for it to be involved in day-to-day investigations in the case as the resources at its disposal were scarce.

The bench said the issue of black money has to be taken with a degree of seriousness and the state is primarily responsible to make all efforts to bring back into the country such wealth and punish people who have stashed away money in foreign banks.

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The court observed that unaccounted money going to foreign banks from the country was a reflection of incapacity of its authorities to collect taxes which is their constitutional obligation.

"These incapacities go to the very heart of ungovernance," the bench observed, adding the wealth going to foreign banks might cause substantial damage to the country as it could be used for unlawful activities.

During earlier hearing, the government had told the court that it had constituted HLC headed by the revenue secretary.

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It included directors of Central Bureau of Investigation, Intelligence Bureau, Enforcement Directorate, chairman of CBDT, director general of Revenue Intelligence, director general of Narcotics Control, director of Foreign Intelligence Office and joint secretary of Foreign Trade.

The functioning of the HLC was questioned by the apex court during the hearing on May 12.

The bench had expressed surprise on why charge sheet filed by ED against Hasan Ali Khan in a money laundering case was not placed before the HLC which was appointed by the government to counter the plea for setting up of SIT to monitor the probe.

Justice Reddy, who will head the SIT, had been elevated to the apex court in October 1991 and retired in March 1997.

He continued as chairman of the 16th Law Commission of India but resigned in 2001.

Justice Reddy has also headed several key sub-panels of the National Commission to Review Working of the Constitution, set up under the chair-personship of former Chief Justice of India M N Venkatachaliah.

The NCRWC was established by the erstwhile Vajpayee-led National Democratic Alliance government in February 2000 to report on various anomalies existing in law and the Constitution.

Justice M B Shah, who will form part of the panel, had become an apex court judge in December 1998 and retired in September 2003.