Friday, February 18, 2011

Budget 2011: time to tackle black money


Mumbai: Budget 2011 may be a great time for the government to re-energise the tax settlement commission. Tax experts say that facilitating greater disclosures may help the government to fight against black money stashed abroad.
Exchange of information agreements seem to be a hot favourite for the Indian government, which is fighting against undisclosed money stashed abroad.
However, tax experts are a little skeptical about how effective these will be bringing in to the light money that has already been hidden.
Tax Markets Leader, Ernst & Young, Sudhir Kapadia, feels that the tax information exchange pacts is more likely will not require other countries to disclose information prospectively. "Going forward it will be very unusual for the other country to demand information from another country." said Kapadia.
Reviewing agreements with tax havens is not enough, they say. Nor is an outright amnesty scheme the best option. They point to the need to coax voluntary disclosures by reviewing existing domestic tax policy and mechanisms.
Tax lawyer HP Ranina said, "Currently, the law says that if you have tax evaded income, the penalty can go upto 300 per cent of the tax evaded. So one way to do it would be to reduce the penalty, considerably, make it attractive for people to make a disclosure and of course give them immunity from prosecution."
Tax experts add that developed nations have already used such schemes to good effect.
"Countries like the United States, the United Kingdom and a few others as well have specifically targeted since the last two years, disclosure of offshore accounts held by their residents and citizens," Kapadia states.
This demand for alternative provisions gathers weight, given the fact that the settlement commission has not been effective in tackling tax evasion. And, Budget 2011 may be an ideal platform for the Finance Minister to push the envelope.

Lalgarh massacre: HC hands over case to CBI


New Delhi: Calcutta High Court on Friday instructed the Central Bureau of Investigation (CBI) to submit the investigation report in the Lalgarh's Netai village massacre case within fifteen days.
The Netai village massacre which took place on January 7, 2011 had claimed at least nine lives and had left many others injured. The massacre was allegedly carried out by CPI(M) cadres in Lalgarh. Crime Investigation Department (CID) was investigating the case and had announced rewards on the six accused who have been absconding in the case.
The Calcutta High Court also pulled up Chief Minister Buddhadeb Bhattacharjee's government for insufficient progress in the Netai killing probe.The Court expressed disappointment that despite sufficient evidence, the CID failed to identify the Lalgarh CPI(M) local committee members, who were responsible for the carnage and that CPI(M) cadres were running two camps in Netai and Bikrar in Lalgarh.
Two suspects, Abani Singh and Ashwani Chalak, have been arrested in the case. The Calcutta High Court had pointed out that CID has failed to gather information about the other suspects in this case despite arrests and confession of Singh and Chalak. The court also told CID that the camps were being run by party orders and the department had failed to gather information on the source of arms, ammunitions and funds of the camp.
Earlier, the state government had submitted a report before the High Court stating that that out of the six accused in the case, five may have fled the state.

IAS abduction: CM asks more time from Maoists


Bhubaneswar: Orissa Chief Minister Naveen Patnaik on Friday appealed to the Maoists not to harm the Malkangiri district collector and an engineer they are holding captive and urged them to extend their deadline that lapses in the evening.
"We are in the process of trying to establish contact. My appeal to the concerned persons is the deadline of this evening be extended," Patnaik told reporters.
He also appealed to the abductors to not harm collector R Vineel Krishna and junior engineer Pabitra Mohan Majhi, who were kidnapped Wednesday evening.
For the release of the hostages, the rebels, in a fresh wish list circulated through a section of the media, are demanding a halt to the anti-Maoist Operation Green Hunt, the release of all political prisoners, scrapping of pacts with MNCs and compensation for the families of Maoist sympathisers killed in police custody.
Their 48-hour deadline lapses on Friday evening.

Kidnapping industry in Manipur


The people in Manipur continue to suffer, as there is no end to the abductions for ransom by militants. On January 21, Khwairakpam Ibobi Singh, Senior Divisional Sales Manager of Indian Oil Corporation was abducted between Chingmeirong and Khonghampat area near Imphal when he was returning from the Chingmeirong oil depot.
The People’s Support Group, which is reportedly behind the abduction, has demanded a ransom of Rs 1 crore from Indian Oil Corporation for Singh’s safe release. “We kept trying his number after he went missing till someone took the call and confirmed that he had been abducted and was with them. They did not give proper information but demanded Rs 1 crore as ransom,” said Bijayanti Devi, the wife of the abducted official.
In another incident, the cadres belonging to the Karbi People’s Liberation Front abducted two drivers and handymen of LPG bullet tankers for a ransom. The outfit has demanded Rs 50 lakh for their safe release. The two drivers and handymen were abducted between Golaghat and Garampani in Assam.
“My husband is the only one who earns money for my family. Now I can’t even support my children. I am waiting for him to come back. But till now I don’t have any information about him,” said Boramani Devi, the wife of the abducted driver Arun. “I am worried about my son. We earn very little and these militants have done this to us. I want to request the concerned authorities to have pity on me. I want my son back safely,” added Sanahanbi Devi, the mother of abducted handyman.
The incident has provoked anger amongst other drivers, who staged a sit in protest outside the All Manipur Road Transport Drivers and Motor Workers’ Union’s office at Mantripukhri. The road transport association has already petitioned the Governments of Manipur and Assam for securing the release of the abducted drivers and their wish to ply trucks on NH-53 instead of NH-39. “We are scared to ply vehicles on NH-39 as militant groups attack us,” said Dilip Singh, Secretary, and Driver’s Union

Manipur’s insurgents sow loans, reap support


Intelligence sources have revealed that Manipur’s insurgent outfits are investing heavily in traditional micro-financing schemes. United National Liberation Front, the leading insurgent group in Manipur, has been on a loan-giving spree for the last five years. A substantial part of the banned outfit’s annual budget, prepared by professional accountants, goes towards the financing of micro-credit schemes, sources said.
Arrested UNLF chairman RK Meghen’s interrogation and documents recovered from him put the banned outfit’s budget at around Rs 58 crore.
As part of the scheme, R4,000-10,000 is loaned to unemployed local youth, who pay back R1 a day as interest. The loan is used to set up business enterprises such as shops or agricultural operations. As this provides the youth with gainful employment, their support and goodwill is utilised for protests and logistical help. The number of youth who have availed of this scheme has been pegged at about 3,000.
“With lack of governance, a certain vacuum exists which is being filled in by insurgents.  For insurgents, it is a win-win situation. They invest their money and also earn goodwill. The only loser is the government space,” said Prof Amar Yumnan from Manipur University.
manipur insurgetns
The unique traditional banking system called ‘marup’ is the dominant money-lending system in Manipur where banking penetration is very poor. 

“It is an open secret here. Insurgent outfits operate such schemes under a no-profit-no-loss system as it also helps them build a support base,” said a Manipuri local.

The micro-finance scheme was also conceived as a vital instrument for Operation Interface, devised by the outfit to involve sympathizers and intellectuals in raising the demand for a plebiscite.

A part of UNLF's budget goes to the payment of salaries. A UNLF cadre takes home a salary of about R4,000 every month. A substantial part goes into the buying of arms. Just across the border from Moreh is Tamuh, a small town in Myanmar, where arms and ammunition that are sold almost openly come quite cheap.


BJP scores 3 on 3, trinamool wins in manipur


The BJP has won all the three seats it contested in the just held by elections, the results for which were announced on Thursday. BJP leader and Jharkhand chief minister Arjun Munda won the Kharwan assembly poll by 17,366 votes against his closest rival, Krishna Gagrai of the Jharkhand Vikas Morcha (Prajantarik), which was supported by the Congress. A Lok Sabha member from the Jamshedpur constituency, Munda will vacate the seat soon.
“It’s a victory of the masses,” the visibly relieved chief minister said.
The allies in the Jharkhand government, the Jharkhand Mukti Morcha and the BJP, have 18 seats each in the 81 member assembly.
In Madhya Pradesh, the BJP wrested the Kukshi and Sonkutch assembly seats in Madhya Pradesh from the Congress.
This takes the BJP’s tally in the 231 member assembly to 146, and that of the Congress slips to 66.
In Kukshi, the BJP’s Mukam Singh Kirade won by 16,116 votes over his closest rival, Nisha Singhar of the Congress.
In Sonkutch, the BJP's Rajendra Verma trounced Congress's Arjun Verma by 18,953 votes.
In Manipur, a Trinamool Congress candidate was elected for the first time in the history of the state. The party's candidate, K Sarat, defeated his nearest rival and Congress contender, S Ranjan, by a margin of 655 votes in the by election to the Konthoujam assembly constituency in Manipur’s Imphal West district. Sarat got 9,592 votes and Ranjan 8,937.
The Congress, which is in power in the state, now has just 30 seats in the 60 member house. It is, however, supported by the CPI and the Nationalist Congress Party.