by Harish Gupta, National Editor, Lokmat Group
Dear reader, I beg your apology for repeating this quote of Prime Minister Narendra Modi at an election rally. But it has a different context here. As an election speech, it is loaded with unpleasant & unnecessary comments that has now become Modi’s hallmark. It is also somewhat amusing. But there is a sub-text of threat running under the lines, and the tone of a bully is unmissable. But is it for real?
But it seems the dark memories of the days when the Constitution was kept in abeyance are fading from Modi’s and my friend Jaitley’s memory. It is unfortunate that the government has got the math wrong after four decades.
“I do not want to desert dignity and reason, but if you desert dignity and reason and speak nonsense, your history will always chase you, your evil deeds and sins will always chase you”.
Dear reader, I beg your apology for repeating this quote of Prime Minister Narendra Modi at an election rally. But it has a different context here. As an election speech, it is loaded with unpleasant & unnecessary comments that has now become Modi’s hallmark. It is also somewhat amusing. But there is a sub-text of threat running under the lines, and the tone of a bully is unmissable. But is it for real?
So far, the Modi administration has proved being given more to barking than biting. The pending cases against opposition leaders—be it the National Herald case against the Gandhi family, the alleged land scam of Robert Vadra, the Gandhi son-in-law, or the Saradha/Rose Valley chit-fund cases allegedly involving West Bengal chief minister Mamata Banerjee’s Trinamool Congress—are progressing as sedately as most anti-corruption cases in India. But, underneath the Prime Minister’s rhetorical flourish, the stage is quietly being set for the unrolling of a new hard state. It is in conformity with the current “alt-right” narrative that much of today’s “ills” are due to over-extension of the due process of law.
Its first sign came in finance minister Arun Jaitley’s budget speech, when he proposed to amend Section 132 of the Income Tax Act. It authorises a raid whenever there is a “reason to believe” or “reason to suspect” that the concerned person is hiding his wealth. Tax officers are under no obligation to disclose such “reason to suspect” to anyone, least of all to the targeted assessee. In yet another change, the tax authority will be free to requisition some other authority (Enforcement Directorate, for that matter) to deliver books of account, documents or assets of the assessee. The amendments will take effect retrospectively from the time the concerned laws were enacted, which are April 1962 and October 1975 respectively. The retrospective amendment in the Finance Bill 2017 is a poison dart that not only overturns a basic principle in law that none should be punished for an ‘offence’ that was not deemed an offence at the time of its commission. More significantly, the amendments are indeed very harsh as recording of “reason to suspect” is held to be a safeguard to prevent searches at will or directions and fishing expeditions.
I am told Jaitley seems emboldened by “Pooran Mal Etc V. Director of Inspection (Investigation) of Income Tax” in which a Constitution bench held that Section 132 inter alia did not run against the fundamental rights. But that judgment came in view of the Section as it now exists, not in the context of its proposed mutilation. The amendment, in its present form, may give free play to tax sleuths to unleash the so-called raid raj on assesses based on rumour, canard, whim or unsubstantiated suspicion. The tax officials were fighting for a long time to acquire this draconian power and they succeeded finally. It also looks like a page taken from history as this is exactly how the financial arms of the 1975 Emergency worked under Indira Gandhi, using Conservation of Foreign Exchange and Prevention of Smuggling Activities (COFEPOSA) Act as the fearsome umbrella to detain the regime’s resourceful adversaries without trial. Pranab Mukherjee, presently President of India, was a junior minister in the revenue department.
That Mukherjee did not unlearn his early lessons in “hard state” became evident in his handling of the dispute on transfer pricing of multinational telecom company Vodafone as Finance Minister during UPA-II. It launched the Indian operations by buying stakes in Hutchison Whampoa, a Hong Kong-based company, but Income Tax authorities in India insisted that the transfer pricing, or transaction between two foreign entities for acquisition of a domestic business, would come in its jurisdiction. When the Supreme Court ruled in favour of Vodafone, dismissing IT Department’s jurisdiction, Mukherjee, in his last budget in 2012, brought retrospective amendments to the tax laws. India was globally reprimanded for retrospective amendment of tax laws and subsequently slid sharply down the ladder of ‘ease of business’. Critics of Mukherjee’s apparent overzealousness included most BJP leaders, including Jaitley.
In his 2014 budget speech, Jaitley was no longer critical of retrospective amendments to tax laws but he was circumspect. “The sovereign right of the government to undertake retrospective legislation is unquestionable. However, this power has to be exercised with extreme caution and judiciousness keeping in mind the impact of each such measures on the economy and the overall investment climate. This government will not “ordinarily” bring about any change retrospectively which creates a fresh liability”. Jaitley said in the same speech that he was committed to a “stable and predictable” tax regime.
Both Modi and Jaitley had invested a good measure of their youthful days in the struggle against Indira Gandhi’s Emergency. While the former worked for RSS under concealed identity and the latter being kept in detention for the entire period under draconian MISA. Of all the laurels Jaitley has earned at the bar or in the political sphere in his illustrious political career, the shiniest is the sacrifice he made during Emergency. When Modi rants against the corrupt, he commands an unusually large number of sympathetic nods. His demonetisation drive, however painful, got mass acceptance as most felt he was against the privileged class. If Modi continues to command high ratings across the country, Jaitley’s graph as FM rose too.
