Keep Trying

Instead of giving up too soon, if all of us keep trying again and again , we would be able to make a change in our Social , Political , Economic environment

A case in point

Following report appeared in media, a few days back :

A CASE :

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I-T lens on 68 lakh non-filers who made high-value transactions

NEW DELHI: The income tax department has identified an additional 67.54 lakh non-filers who carried out high-value transactions in the 2014-15 financial year, but did not file tax returns for 2015-16.

The I-T department is set to initiate action against these people soon.

The information was collected from banks and other financial institutions.

Data analysis carried out by the Central Board of Direct Taxes+ (CBDT) identifies non-filers about whom specific information is available in transaction reports received in its databases from various sources. 

The analysis is carried out as part of the I-T department's Non-filers Monitoring System (NMS) which is meant to identify non-filers with potential tax liabilities.

A CBDT press release said that the I-T department had identified the 67.54 lakh people by conducting its fifth cycle of data matching.

The department is in the process of sending notices to these non-filers to now account for their transactions and pay taxes as applicable.

The non-filers can access details of their transactions when they log on to the e-filing portal with their PAN, the CBDT said.

The PAN holder will be able to respond electronically and retain a copy of the submitted response.

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POINT :

I sent following blogs / emails to NDA ministers / Secretaries etc , over the past 2 years :

Thursday, 26 August 2016

Still a long way to go !

Times of India ( 26 Aug 2016 ) carries following news report :

"  CVC  TELLS  CBI  TO  SHARE  DETAILS  OF  BIG-TICKET  FRAUDS  WITH  ED  "

" The Central Bureau of Investigation has been asked by the CVC to share details on big ticket frauds with the Enforcement Directorate so that the provisions of anti-money laundering Act can be invoked at the stage of investigation itself. 

The decision comes as there have been cases of corporate frauds involving crores of rupees. 

The CVC has asked CBI to share relevant details on big ticket frauds with the ED so that provisions of Prevention of Money Laundering Act can be invoked at the stage of investigation itself, officials said today.

They said it will help in taking stringent action against the fraudsters during the investigation stage itself.

There has been cases where ED is roped in at later stage by the CBI and at times, it results in losing out crucial leads and also cause delay in punishing the accused or trace money laundered by them, the sources said, adding that the CBI has started sharing relevant details with the ED. 

In a related development, the CBI has also been made the nodal authority for public sector banks to report high value frauds worth over Rs 50 crore. 

A Joint Director level officer has been authorized in the CBI to receive complaints of the frauds from the banks. After receiving such reports, the officer can recommend investigation by any of the agency's wings ( Anti Corruption, Economic Offences or Bank Security and Fraud Cell ).

The Chief Vigilance Officers, who act as distant arm of Central Vigilance Commission (CVC) to check corruption, of banks have been asked to act as nodal officers to coordinate in reporting such cases to the CBI. 

A total of 171 bank fraud cases involving funds of over Rs 20,000 crore were probed by the CBI last year. "

There is no doubt , this type of co-ordination between different Agencies of the Government dealing with Economic Fraud  will help , but what will bring about a complete SEA CHANGE in the process of quickly catching the culprits , will only happen when my following suggestion ( sent as hard-copy to  PMO on 06 Nov 2014 ) , gets implemented :

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06 Nov 2014

E - Governance ?

Can e-Governance help eliminate corruption  ?

Most certainly

Look at the following , partial list of  Central and State Agencies  set up to fight fraud , money-laundering , corruption , tax-evasion , economic crimes etc :

*  Public Accounts Committee           (  PAC  )

*  Central Vigilance Commission        (  CVC  )

*  Central Information Commission     (  CIC  )

*  Research and Analysis Wing           (  RAW  )

*  Serious Fraud Investigation Office   (  SFIO  )

*  Information Bureau                        (  IB   )

*  Economic Offence Wing                   (  EOW  )

*  Central Bureau of Investigation        (  CBI  )

*  Department of Revenue Intelligence (  DRI  )

*  Comptroller and Auditor General       (  CAG  )

*  Anti Corruption Bureaus ( States ).... (  ACB  )

*  Enforcement Directorate                    (  ED   )

*  Lok  Ayukts    (  States   )

*  Lok Pal           ( Central  )

Despite such an army of Agencies , how do corrupt manage to get away  ?

Or , in case caught , manage to delay delivery of punishment for years  ?

No doubt , there must be several reasons , including , inter - agency rivalry to get credit - something difficult to eliminate altogether

But , I believe , the most important reason is :

Lack of a COMMON  / COMPUTERIZED  database of all offences / cases / persons being investigated

And , which is readily " Accessible " to all of these Agencies , all over the country ( 24 * 365 )

Already , every Agency compiles huge dossiers on " Suspects " in its own 

" Departmental Database " , which is never shared with other Agencies ,

leading to ,

*   Huge amount of duplication of efforts / information

*   Fractured / scattered profiles of " Suspects "

*   Enormous waste of time / resources

What will help  ?

*  Dismantling of individual departmental databases

*  Merging of all Agency-wise databases into a SINGLE / UNIQUE database

*  All Agencies to enter their findings / data / info into this COMMON

     database , with nothing preserved on local computers

*  All data-entry FORMS to be ONLINE . No paper forms at all

*  All local computers connected to ultra-secure Network ( Encrypted )

*  " Access Rights " to individuals , based on Biometric Identification

I believe , not only such an " INTEGRATION  OF  DATABASES " is highly desirable , it is also ENTIRELY POSSIBLE , if there is a POLITICAL WILL

And I don't think , this will require passing of any law in the Parliament

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I am getting to believe that the NDA ministers and

Secretaries , do find time to read my daily E Mails !

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25  Dec  2016

www.hemenparekh.in / blogs

Indonesia Shows the Way

While being interviewed by Shereen Bhan ( CNBC TV18 ), two days back , Ruchir Sharma said :

" At 50 % tax rate , I do not expect much hidden / unaccounted BLACK MONEY to get declared by Indians , under recently amended Income Tax Act ( PMGKY Amnesty Scheme )

On the other hand , Indonesia succeeded in unearthing US $ 200 billion worth of BLACK MONEY  {  US $ 200 Billion = approx Rs 136 lakh*crore  } , in last few months

Of this , some $ 30 billion of black money got declared by son of late president Suharto "

Even the Indonesians who are used to Tsunami , were caught unprepared by this unprecedented tide of BLACK MONEY , washing over their shores , from all over the World !

What brought about this " miracle " ?

No rocket science here . Indonesian government believed in the

 " Power ofGreed "

{  http://myblogepage.blogspot.com/2015/10/from-greed-to-great.html  }

They told the BLACK MONEY hoarders :

" Declare your hidden wealth and pay just 3 % income tax ( to be raised to 4 % after 9 months ! ) "

Our own recent track record is as follows :

*  Last Undisclosed Assets Declaration Scheme @ 60 % tax + Penalty =   Rs 50,000 crore

*  From Rs 75K Cr deposit in Jan Dhan A/C since 08 Nov ( @ 50 % tax )= Rs 50,000 crore

So , Indonesia beats us , Rs 136 lakh*crore  to  Rs 1 lakh*crore  !

This Indonesian Miracle must be viewed in light of following estimates of India's Black Money :

 *  Stashed away abroad between 2005-2015  = $ 50 billion ( Rs 35 lakh*crore )

*   At 12 % of GDP ( $ 2300 Billion ), our BLACK MONEY economy = $ 276 billion

  (  Rs 185 Lakh*crore )

Now imagine , if we too had offered PMGKY ( Prime Minister's Gareeb Kalyan Yojana ) , to our black money hoarders , at 5 % tax rate ( instead of 50 % announced )

We could have managed to get them to deposit / declare , Rs 100 lakh*crore ( out of Rs 185 lakh*crore ) , with 90 % amount being declared by " You know Who ? "

And  government would have collected , Rs 5 lakh* crore  by way of tax

Perhaps enough to abolish Personal Income Tax from 2017 onwards !

We could have done much better than Indonesia - and 5 years ago - had UPA government considered my following blog / suggestion :

THURSDAY, 9 JUNE 2011

MagicWand ?

{  http://myblogepage.blogspot.com/2011/06/magic-wand.html  }

May be Shri Arun Jaitleyji could still consider it for the forthcoming Union Budget

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24  Dec  2016

www.hemenparekh.in / blogs

A Knee Jerk Approach ?

Today's Livemint.com , carries following news report :

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Car buyers may need parking space certificate in future  :   Venkaiah Naidu

To tackle growing congestion woes and lack of parking space across the country, the central government is looking to make it compulsory for car buyers to obtain an adequate parking space certificate.

Addressing a press conference in the national capital, urban development minister M. Venkaiah Naidu said that in the future it would be compulsory for cars to provide an adequate parking space certificate.

“In future, I also want to share with you that no car or vehicle will be registered without an adequate parking space available certificate. I am very keen on this. I am holding discussion with the surface transport minister and also sensitizing the states. We would be moving in that direction,” Naidu.

“In future it will be mandated. No permission will be given to any construction without a toilet,” Naidu, who was addressing a press conference on the launch of a toilet locator mobile application, added.

The Motor Vehicles (Amendment) Bill, 2016 was introduced in the Lok Sabha in August. The amendments are yet to be passed by Parliament. It aims to address the issue of road safety and improve the processes for citizens while dealing with transport departments.

In 2015, the Himachal Pradesh High Court had directed the state government to make compulsory for people to show a certificate of parking for cars that are to be registered for use within the Shimla municipal area.

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I strongly urge the Government , not to attempt such knee jerk reactions to the problem of urban transport congestion / vehicle pollution / road safety etc , all of which need to be addressed through other means

Will such a " directive / order / regulation " , not be unfair to future buyers of cars , when millions of existing car owners are parking their cars on public roads , without any permit ?

And why only cars ?

There are millions of buses / trucks / bikes / rickshaws / taxies etc parked on public roads , all through day and night ! Their owners have no permits ! And these are , their only " means of earnings " !

Then there are millions of " Un-licensed " carts on the foot paths of all cities , which leave no place for pedestrians to walk !

Leave aside a place to " park " these carts inside their huts ,  their owners have nothing but a footpath for themselves , to sleep at night !

Next , will the government come out and say :

" If you cannot prove that you have adequate means to support / bring up a child , you cannot bring her to life " ?

In fact , our constitution promises certain " fundamental rights " to every child born , irrespective of the financial condition of its parents

I am not suggesting that it is a fundamental right of every " new-born " car that the government provide it with a " parking space " !

Would you go so far as to tell the car manufacturers :

" Thou shall not sell a car to a person who cannot produce a certificate that he actually possesses , a parking space " ?

Or , tell Washing Machine manufacturers :

" You shall not sell a washing machine to a person , who does not have " Certificate of Adequate Water Supply " ?

If so , how about telling the doctors in hospitals :

"  You will not permit a baby to be born in your hospital , till the would-be parent produces a statement of his bank balance " ?

And prey , who will be that " CERTIFYING AGENCY " ?

By enacting " Un-implementable " laws , are you not giving rise to corruption ?

How much would I need to bribe that " CERTIFYING AGENCY " ( no doubt , with new Rs 2,000 note ! ) , to get such a permit ?

And how much more ( by way of monthly " haftas " ) to " IMPLEMENTING AGENCY " ?

And having obtained a " parking space "  , can I ,

*  " TRANSFER " it to someone else when I move to another street or town ?

*  " SELL " it or " RENT " it , if I sell my car and do not need a parking space ?

*  " GIFT " it to a relative / friend ?

*  " WILL " it to my children when I die ?

*  " INHERIT " it from my grandfather ? ( like " Purush-Dhan " ? )

Dear Shri Venkaiahji ,

Before rushing in with such a draconian measure , I urge you to upload a online OPINION SURVEY , inviting citizens to tell you whether it will provide a solution or increase corruption

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23  Nov  2016

www.hemenparekh.in / blogs  

People with Inside Info ?

Having never met Shri Narendra Modiji , I do not have the advantage of knowing his thinking on the issue of eliminating BLACK MONEY , - an advantage that Shri Gurumurthy and Shri Anil Bokil seem to enjoy, going by the following news reports :

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Source : Times of India ( 12 Dec  2016 )

" Introducing Rs 2000 notes is a stop-gap arrangement for the immediate post-demonetisation scenario, RSS ideologue S Gurumurthy said today in New Delhi.

Asked why the Rs 2,000 note was brought in and that it could encourage black money, Gurumurthy said, "In the short time of two months you do not have time to print Rs 500 and Rs 1000 notes. 

This 2000 rupee note must be phased out ... Demonetisation is not a one-stop solution for black money. This requires a very major agenda... The nation is rebooting."

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Source : Hindustan Times ( 22  Dec  2016  )

" Anil Bokil, the man who gave the idea of demonetisation to Prime Minister Narendra Modi, on Wednesday said the Rs 2,000 note was only a stopgap arrangement and it would be withdrawn once availability of cash normalises in banks.

 Bokil, said the Rs 2,000 notes were only serving as a ‘diversion’ to allow the government to build an ‘overbridge’ in place of the ‘road damaged by black money’. “It will be closed once the overbridge is complete,” he added.

The social activist from Aurangabad in Maharashtra, however, warned that the government’s bid to encourage cashless economy would yield positive results only if the tax system is revamped, offering huge incentives to the people.

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To best of my knowledge, proposal that Shri Bokil presented to Shri Modi in 2013 ( when he was CM - Gujarat ) mainly comprised of :

( A )  Total abolition of Personal Income Tax and introduction of 2% BTT ( Bank Transaction

        Tax ) on all " payment transactions " through bank ( not on withdrawals )

( B )  Abolition of all other Indirect Taxes

( C )  Highest denomination currency note to be of Rs 50

I totally support ( A ) , and unable to comment on ( B )

But I believe ( C ) is totally impractical

I agree that the black money holders would find it impossible to hoard Rs 1 crore at home ( or in bank lockers ) , consisting of Rs 50 note, or carry in a brief case, weighing 200 kg !

But , if people could manage their daily purchases with a Rs 50 note , millions would not be queuing up before the bank counters and ATMs, for past 42 days !

Even a housewife, out for shopping, needs to carry in her purse, notes of Rs 500 , when

even vegetable prices hover around Rs 150 per kg !

Reason why countries such as USA / UK etc , manage with their highest denomination notes at 100 times the face value of their smallest denomination notes is that, in their economies, some 90 % of the payment transactions are " Non Cash "

It would be many years before we could reach that stage

So, the government must have thought :

" For now, we do need higher denomination notes "

But the BLACK MONEY holder / generator thought :

" Oh, what a god-sent opportunity to carry Rs 10 lakh worth of Rs 2000 notes in my pocket , weighing only 500 grams instead of 1 kg weight of Rs 1000 notes ! "

Events of past few weeks have only re-confirmed my belief that the only way to keep the higher denomination notes into circulation for day-to-day usage of common men but, at the same time thwart the re-generation of a vibrant BLACK ECONOMY , is to :

EMBRACE  THE INEVITABLE

{  http://myblogepage.blogspot.com/2016/11/embrace-inevitable.html  }

And , this much I say , without being privy to any inside information !

To the NDA ministers , I would say :

There is no loss of face in admitting that just replacing OLD notes with NEW notes , has turned out to be a case of replacing OLD black money economy with a NEW black money economy ( leaving aside reported demands for bribes in the form of Gold / Diamonds ! )

Let us not lose this battle ,

FOR  WANT OF  A  NAIL

{  http://myblogepage.blogspot.com/2016/12/for-want-of-nail.html  }

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22  Nov  2016

www.hemenparekh.in / blogs