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Who are India’s boneless chickens?

Akhilesh Bhargava

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It is a common experience that uncontrolled powerful CEOs, with no checks on their power go astray and indulge in serious malpractices. They ensure that there is no one in the organisation to restrain their unbridled power. As they ascend the ladder of power, they gather a bunch of eminent sounding yesmen around then, who willingly collude in their blatant abuse of power. These ambitious/greedy CEOs manage to totally centralise power in their hands, such that they subvert all and sundry and they become the system itself. At this point of time, the institution that they head is subverted and they verily become the institution, which is very dangerous for any country, particularly when it is a democracy like India. who are the boneless chickens? Mr. Akhilesh Bhargava, Business Editor of HW Business and Finance shares his insights on the matter.

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Business Tit-Bits

What was the Harshad Mehta tax story?

Akhilesh Bhargava

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The original Big Bull of the stock market, Harshad Mehta, was being investigated by numerous authorities for the 1992 stock market scam he perpetrated. The Income Tax Department conducted raids at numerous premises of Harshad Mehta and family and siezed many documents amongs other evidences. However, there was no black money involved as the source of all money recieved was from banks and all transactions were well documented. The IT Dept gave him and his family a hard time by adding frivolous income to his total taxable amount and this case went on for 27 years, even after Harshad had himself passed away. Finally, the ITAT, the final fact finding authority, srapped most of the additions to his income of over 2,000 crore ₹ which the IT Dept had made and further went on to make some observations of their own. Unfortunately, this is also the case with most taxpayers that IT Authorities in spite of having a low success rate, tend to keep appealing the matter without a genuine case, thereby causing much difficulty to small and medium tax payers.

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Business Tit-Bits

Yes Bank Deliberately Misleads

Akhilesh Bhargava

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Yes Bank recently released a report by RBI which stated that it had given the private lender a clean chit and found nil divergences in asset classification and income recognition. However, this was not the whole truth and Yes Bank conveniently omitted the fact that RBI in the same Asset Quality Report had discovered non-reporting of NPAs in 2015-16 to the tune of 4,176 crore ₹ and in 2016-17 of 8,373 crore ₹. The report was also a confidential one and was not to be revealed to the public. Serious accounting malpractices and loans are given contrary to the bank’s lending policies were also found which finally led to the RBI insisting Yes Bank’s founder Rana Kapoor be removed. The RBI has promised regulatory action for this breach of trust and deliberately attempting to mislead the public which made Yes Bank’s shares rise 32% in a single day.

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Business Tit-Bits

Is the Jet rescue plan a hogwash?

Akhilesh Bhargava

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The debt-ridden Jet Airways, which was once India’s largest private sector airline, has declared a massive quarterly loss again and its market share has fallen and it has become a fringe player. It is also dealing with a host of other problems and its promoter Naresh Goyal is not willing to let go of his company in favour of another investor. Its largest lender, SBI has come up with a revival plan that involves converting debt into equity and this will ensure that Naresh Goyal’s stake in the company comes down to 20% and he will lose effective control over it which has to be approved by shareholders at their next meeting. What is important, however, is that Naresh Goyal should not be given to managing the airline like in case of Kingfisher Airlines back in 2011and a new management must emerge to take control. All these factors must be clearly included in the restructuring plan.

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