(The following has been excerpted with permission from former IRS officer Ajay Mankotia’s forthcoming book ‘There's Seven For You , Three For Me—Chronicles of a Taxman’. The book is slated for a 27 November 2019 release. Opinions expressed are the author’s own. The Quint neither endorses nor is responsible for them.)
Not long thereafter, we heard a loud sound growing louder by the minute. We were with P upstairs, going through the books at that time. The thunderclap was approaching the house from the front side. In the courtyard, the policemen stood in huddles wearing frowns and tightening their grip on the rifles and lathis. The pit in our stomachs started ringing alarm bells of foreboding.
We didn't have to wait for long. Cries of ‘Hai Hai’ and ‘Murdabad, Murdabad’ reached our ears before the crowd appeared at the front gate. School students stood at the gate carrying out their deathly chants. They carried sticks and chains. The gate stood no chance. It yielded meekly and the crowd stormed in.
‘Ab aap logon ke saath kya kiya jaye?’ P jeered. The atmosphere in the room had turned menacing. The team members’ faces had turned ashen with dread.
We requested P to intervene in the matter. Stopping the raid through use of force would be counter-productive and illegal, we tried to reason. But our entreaties fell on deaf ears. He was a man possessed, and showered us with the choicest abuses. Before we could react, a massive uproar came from downstairs.
‘Maaro, maaro,’ came the frenzied yells from the rear courtyard. Looking down from the rear window of the upstairs room, we saw the back door open. The police were running in the fields, the crowd giving them a spirited chase. Many of them had dropped their rifles and lathis. We were horror-struck. The police had well and truly abandoned their posts, and had left us at the mercy of an enraged politician and his blood-thirsty goons.
What Kept Officials Glued to Finance Minister’s Speech? Promise of Chai & Snacks!
A change of government took place when I was in the Central Board of Direct Taxes (CBDT). The new finance minister was being felicitated in the quadrangle inside the North Block. The program started at 4 pm which was to be followed by tea and snacks (which were already placed in boxes). There was a dais with senior officials, few rows of chairs for officers, and standing space for the staff. All the staff turned up which I found to be most pleasantly surprising. Nothing would please the new minister more than to see an unending sea of faces stretch out all the way to the back. I was to learn the reason for this an hour later.
When the first speech began, the crowd was all ears. They clapped with gusto when it got over. Then the second speech began, then the third, and so on. The enthusiasm began waning and by 4.45 pm; the crowd had become restless. They spoke to each other loudly, they fidgeted, and stopped clapping. Speeches were falling on deaf ears. Then the vote of thanks was announced, and the mood became somewhat upbeat. A very strange phenomenon was noticed by me. The crowd was subtly moving towards the rear, somewhat like a receding tide.
As soon as the speaker requested the gathering to partake tea and snacks, all hell broke loose.
Within seconds, every packet on the table and every reserve packet kept behind was snapped up — in twos and threes and fours. There were arguments, there was jostling, there was foul language, a fisticuff or two. And then the crowd vanished to their bus stops. Left behind were shell-shocked newcomers like me, an amused hardened crowd of veterans, and a new minister who had just been given a demonstration of what had motivated the men to come out in large numbers and who were now part of his fiefdom. It’s a good thing that tea and snacks had been kept separately on the dais for him and the senior officers.
If the minister went back to his chamber in a shocked state, at least he didn’t go back hungry!
Understanding a ‘Scam’ the ‘Walrus & Carpenter’ Way
By 1992, I had already spent ten years in the tax department. Though words like ‘evasion’, ‘concealment’, ‘avoidance’, ‘colourable devise’ were usual in our day-to-day work, the word ‘scam’ entered the tax lexicon for the first time during those days. And the word would become part of our professional lives for the next four years.
Our chief commissioner, in the editorial he wrote for the departmental magazine —Aayakar Patrika — put the ‘scam’ in perspective. Noting that the JPC, in its concluding paragraph, had stated that it had come across various instances of close nexus between prominent industrial houses, banks and brokers, he invoked Lewis Carroll’s The Walrus and the Carpenter and observed that the system had failed to notice certain connections, certain collaborations and connivance. Did the system eat up the beings as the Walrus and the Carpenter did to the poor Oysters?
To understand the ‘scam’ in its complete details, the five officers dealing with banks were tasked with getting a thorough knowledge of the working of the RBI, the stock exchanges, the capital market, and the government securities market.
We were deputed to the concerned institutions. We went through the Janakiraman Report and the JPC reports, as and when they were released, with a fine-tooth comb. We also studied the relevant laws on the matter (the Securities Contracts (Regulation) Act, 1956; the Banking Regulation Act, 1949; the Reserve Bank of India Act, 1934), as well as the various instructions, circulars and guidance issued by the relevant institutions.
Having thus equipped ourselves with both facts and law on the ‘scam’, and the concerned institutions, it was time to put the knowledge to use.
We had to establish whether, and to what extent, the banks were involved in the ‘scam’. The other issue was that even if the banks were involved, were there any tax implications?
How Even An ‘Ideal’ Taxpayer Wasn’t Immune to a Raid
A very well-known director is also covered. Initially he is very upset because he's been felicitated by the tax department a few weeks earlier for being an ideal taxpayer. He feels, rightfully he thinks, that he should be immune from a raid. But if the Investigation Department gets information that not all income has been declared, a felicitation does not come in the way of a raid. As the raid progresses, he mellows down and is co-operation personified.
I meet him and his sons in the evening. He is very humble, earthy, and loquacious. He's just finished producing a film, directed by his son, and speaks to me about the experience. A former superstar, who was then having a lean patch, had approached him requesting for a role when the film was being conceived. The director had worked with him in the past, with outstanding results, and had acceded to his request. “You must see the movie; my son has done a great job,” he tells me. He presents me with the music CD of the film. The topic then shifts to a music function he had attended.
He is very bitter that the filmmakers don’t receive any royalty for songs of their films sung live on stage, even though singers are paid handsomely for the songs.
A ‘Musical’ Tax Department
Anand-Milind did a show with a galaxy of singers in the mid-90s. In one of the duets they presented, they graciously agreed to let a senior tax officer’s wife do the honours with Udit Narayan. She was a classically trained singer, so they had no problem. There had been no rehearsal with her, because the request was at the last minute. It was a popular song, ruling the airwaves. Now, a person with classical training requires self-discipline not to introduce kan, meend, andolan, gamak, murki or other ornamentation into a commercial Hindi film song which has no need for it. But our lady did not have that self-control.
She converted the chartbuster into a semi-classical song. The beat also slowed down.
Anand immediately rushed to her to take it easy. But she wouldn’t be deterred. Udit, entirely uncomfortable and out of his depth at the turn of events, whispered into her ears a few times but in vain. The music directors and Udit gave up after that. The crowd booed and whistled their disapproval but it didn’t matter. We all heard the ‘ghazalised’ version of a pacy, frothy song. Only the tax department could pull it off !
(The book has been published by Readomania Publishing and is available on Amazon)
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