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Raid Politicians, But Not Selectively

Akhilesh Bhargava

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It has always been well known, that apart from the tax evader businessman and industrialist, the biggest hoarders of black money have been the politicians and the bureaucrats. In fact it is often seen that seniority in politics is directly determined by the size of the loot at the disposal of the politician. While the source of the black money of the businessman has been tax evasion and crime, that of the politician has been much more disturbing and serious viz. corruption and crime. Being the rewards of crime, the politician cannot legitimise it, even if he is willing to pay taxes thereon, which interestingly, many are indeed willing to. Thus these proceeds of plunder remain in hidden and undisclosed assets, by way of cash, gold benami shares, land etc. and where the amount is sizeable, it has been parked is hidden bank accounts in tax havens like Switzerland, Panama, Dubai, Singapore etc. Such corruption of the netas, apart from perpetrating crime in India, has also denied the country the benefit of these funds of black money, which cannot be disclosed and put to national use. It is often said that if all the funds of Indians, that have been illegally parked in tax havens abroad were found and put to national use, our national problem of poor infrastructure would be resolved.

Despite the fact that this loot, at the disposal of the politician stares in your face, yet there has been political unwillingness to raid politicians and unearth and seize the huge funds that they have plundered, for very obvious reasons. This has been so irrespective of the party in power, because at the end of the day when the top politicians of the country sit together on the cocktail bar, they are mafia brothers, out to protect each other.

The attitude towards tackling politicians, has however been a bit different under the Modi regime. We often hear of income tax and ED raids being conducted against various politicians. Politicians have been raided by the tax sleuths in Karnataka, Andhra Pradesh, Tamil Nadu and now a minister in the AAP government of Arvind Kejriwal has been at the receiving end of a tax raid. These raids are generally successful, because the entire business of politics is founded on and funded by black money. Whether it is contesting elections or the shameful horse trading thereafter, the tool of the trade is black money only. The bigger the neta, the bigger the loot he possesses and that much easy a sitting duck he should be for the tax authorities.

If these netas are tackled and tamed across the board, irrespective of their party affiliation and their loot is seized by the state, their political careers would be finished and India would be cleansed of the curse of political corruption and plunder of the nation. But for that, one law and one nation must apply to all the politicians and not selectively as we presently see. At present, the tax and ED raids, though justified and highly successful, are being selectively conducted against the opposition party netas, for political gains, revenge and vindictiveness. That may finish a neta, but it will not finish the crime of corruption and tax evasion in India, which is what it is meant to. Raids on politicians are welcome, but not for settling political scores or gaining political victories.

        

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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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Business Tit-Bits

Has Anil Ambani exited?

Akhilesh Bhargava

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The entire controversy around the sale of shares of the Anil Ambani Group companies by Edelweiss and L&T Finance revolves around the fact that Anil Ambani had taken huge loans by pledging his company shares for loans taken from these NBFCs. Since the market cap of the shares of his group companies has fallen drastically over the last couple of weeks, these NBFCs were forced to sell his shares to protect their interest since he could not meet the terms and conditions of the pledge and did not have further shares to pledge with them. Anil Ambani is not alone and other corporates have also done the same and a staggering 2 lakh crore ₹ worth of shares have been pledged with NBFCs. Such pledges of shares, in reality, represent the promoters losing control of their company and SEBI must realise this and act accordingly.

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Business Tit-Bits

PM Sir, be fair in tax for MSMEs

Akhilesh Bhargava

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The toughest time for MSMEs is the Jan to March quarter where they need all their resources to conduct business efficiently. This coincides with the most intense recovery pressures from various tax departments which hampers the MSMEs cashflows and ability to conduct business. Even in the case of bonafide cases where there are interpretation issues, the tax department demands 20% of the disputed amount which causes difficulty to the taxpayer. Even if the taxpayer does not have the ability to make the payment, coercive measures are used to recover the money. While on the other hand when it comes to refund, the IT authorities do not show any urgency and refunds are delayed, very often on purpose to meet their collection targets. The whole system is rigged in such a way that it is squarely against the small taxpayer who suffers the most. Hence we request the PM and FM to not kill the goose that lays the eggs and destroy the MSME that provides jobs and taxes.

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