( Originally Published on 16 September 2012 @
As per a general notion which says, “100 main 99 beimaan phir bhi mera bharat mahaan”, which says we Indians, are proud of our country in spite of 99% dishonest people. Of course there are various reasons to be proud of our mother land. But dishonesty among people is prominent. Black money was around 10% of the GNP in 1975-76. Along with the growth of the country and various tax evasion practices, black money is now termed as a parallel economy, becoming a serious issue for Government.
Measures like Voluntary disclosure of Income scheme (1996) for converting black money to white money failed to make a dent. Some cases like Hasan Ali case (caught for stashing 36,000 Crore rupees in foreign banks), showed the penetration of black money. While the major eye opener was the Vodafone – Essar deal. Vodafone entered India through Cayman Islands, a tax heaven. This deal which was worth $11.2Bn, not a single penny was paid as tax to the government. Getting a 100% depreciation in first year of investing in windmills, was to promote clean energy. Companies used it as a tax evasion tool. This meant that there is a need of law against avoidance of avoidance of taxes.