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Honorable Shri Justice R.C.
Lahoti, former Chief justice of India, while addressing the National Tax
Conference of the Federation at Indore on 7-9-2002 (AIFTP Journal, Sept., 2002
P. 7) has stated as under:
“Corruption is a cancer
eating in to the roots of the society. It is difficult to fight against
corruption because the chances of success are bleak; but this is no reason for
despondency. Nobody is born corrupt; it is the vitiated atmosphere in the
society and the system of governance which converts the clean in to corrupt.
An honest person resists corruption but allurements and temptations at times
prevail upon him and once corrupt, even an honest person prefers and finds it
convenient to stay corrupt. The seeds of corruption are sown in the mind of
the man and the cure, if any, lies in eradicating the seeds of corruption from
his mind. An honest revenue official says “The honest are hounded; they are
humiliated; they are ignored; they are manipulated; they are used, they are
punished; they became the laughing stock in society and their families; even
their very honesty is suspected. In spite of that, there are many honest
officers in the department who remain honest against all adversities. They are
special species; they have to be preserved and protected.”
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It is very unfortunate that
no political party has any specific agenda to fight against corruption. I
suspect that the real reason behind this slackness is that it is not possible
to fight because it has become part of our system in which we live. Corruption
can be minimized by bringing the concept of accountability, transparency and
computerization. By introduction of computerization of reservation of railway
tickets, the corruption in the system has been brought down almost to minimum.
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Dr. Raja Chelliah in his
Final Report (1992) 197 ITR 177(St) (257) stated in para 5.9. “Ways must be
found to hold the officers accountable for the kinds of assessments he makes,
under the present procedure, an Assessing Officer, whether he be a
Superintendent of Central Excise or an Income tax Officer, can over assess,
raise additional demands without sufficient grounds and yet remain unconcerned
and unaffected if his over assessments and additional demands or orders
confirming demands raised by him are dismissed as untenable by the Tribunal.
In fact, there is tendency on the part of some of Assessing Officers to
recommend to the Commissioner /Collector that almost every case in which the
Commissioner (Appeals) or Collector (Appeal) has not sustained the additional
demands created by them should be referred to the Tribunal because they stand
to lose nothing if the Tribunal also rules against their action. The Assessing
Officers should be made accountable for their actions by being blamed for
raising demands which are not up held by the tribunal. If the percentage of
demands not up held is higher than 50 percent, the officers should be given a
black mark and reprimanded. On the other hand an Assessing officer should be
protected and defended if he has obeyed instructions of the Board and followed
court rulings even though audit might raise objections about his actions. No
officer should be blamed or given an adverse remark merely because audit has
raised objections.”
Though the report was presented in the year 1992, which ever may be the
political party in power, no one has taken any interest to introduce the said
provision. If Government is really serious about reduction of corruption, then
the concept of accountability has to be introduced in the tax law.
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In our country, right from
small business men to big corporates, all are made to contribute to election
process. However the same is not allowable as business expenditure. This has
lead to such contribution being paid secretly and not being reported in the
contributors’ books of account.
I suggest that the law should be amended to the effect that any contribution
made to recognized political parties may be allowed as deduction. This will be
a progressive step in reduction of generation of unaccounted money.
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According to the Federation,
subordinate courts and Tribunals should have a vigilance cell and proper
protection should be provided to the whistleblowers because these are the
people who do not stay mute in the face of glaring injustice and choose to
voice their complaints without fear. It would be appropriate to introduce a
whistle blower legislation which has been introduced in several countries
world wide. The Law Commissions, 179th report on public interest disclosures
and protection of informers prepared by Shri Justice B.P. Jeevan Reddy states
that “Good faith whistleblowers represent the highest ideals of public service
and challenge abuses of power. They test loyalty with highest moral principles
but place the country above loyalties to persons or Governments”.
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The potential role of a
professional as ‘the middle man’ or ‘facilitator’ in corruption should not be
ignored. Such a professional plays a pivotal role in concluding a transaction
of corruption to its evil end.
In this context, it is worth appreciating the initiative taken by the ITAT Bar
Association, Mumbai, which has constituted a committee of three senior and
highly respected members and made an appeal to members to bring to their
notice if any unethical practice is being followed by it’s members. (see
www.itatonline.org.).
If all Bar Associations in India follow the code of ethics adopted by the
members of ITAT Bar Association and maintain vigilance over corruption, it may
help to reduce the unethical practices adopted by the professionals and in
turn the corruption.
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Corruption is eroding the
fabric of nation, It is duty of the citizens to fight the same with same
spirit as how our commandos fought the terrorism. The professional
organizations can play a proactive role by asking the public authorities how
the tax payer’s money has been spent.
Though the Government is collecting the money in the form of educational cess
for the betterment of education the money has been not utilized for the
education. With the effective use of Right of Information Act, the
professional can play a positive role and make the public servants accountable
to the nation. The tax professionals must thoroughly study our tax systems and
this should be ongoing process so as to suggest how complexity in laws, which
breed corruption because of difficulty in compliance, can be eradicated.
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Readers can please send their
views.
Jaihind.
Dr. K. Shivaram
Editor-in-Chief
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