How business corruption became a norm in India
This is a story about bureaucratic extortion that was rampant in SME manufacturing sectors almost a decade back. An excise officer got his transfer orders. He decided to make a quick buck before leaving his station. He visited this unit for a cup of tea. Which sane industry owner would say no to it?
Before leaving, the officer asked for Rs. 5000. The owner asked what for. Officer said I am transferred & we won't meet again, so treat it as a goodbye gift. The owner said NO. If there is no work done, why should I pay? (this owner was OK to bribe but only if there was some work to be done. Most industry owners apply this convenient integrity principle because "Kya karein, dhanda karna hain") The officer went back empty-handed. Two days later, the business owner received a demand letter of 5 Lakhs from Excise Dept.
The owner waited until the officer's transfer & then met the new officer. Looks like the new officer was told about the incident during the handover. He too stood up for the honour of the department & dared the businessman to go legal. So he went to tribunal. But the law mandates payment of the demand amount to govt. before filing the case. This person had to deposit 5 lakhs & then proceed with the legal route. The Tribunal favoured the department & this businessman had to take the case to High Court. Finally, after 4 years of struggle, he got a favourable verdict. But then the bureaucracy made it difficult to get the refund. That took another 9 months. Finally, a new upright lady officer got transferred to that office & she promised him the refund in one week. But the office staff there continued his harassment & didn't make the payment. Seeing this businessman in her office even after one month, the lady officer called him & asked why was he there. "No refund yet," this guy said. The lady officer called her staff members & gave them a dress-down. This businessman got the cheque in the next 1-hour.
A refusal to pay Rs. 5000 cost the man hugely. The interest on 5 Lakhs (Govt doesn't pay you interest), the lawyers' fees & his own productive time lost in this battle. This is how corruption became a norm.
We all treated such payments as the small cost of doing business in India.
The question now for all of you is what has changed in one decade and what is still needing change.
Bring it on. more
Before leaving, the officer asked for Rs. 5000. The owner asked what for. Officer said I am transferred & we won't meet again, so treat it as a goodbye gift. The owner said NO. If there is no work done, why should I pay? (this owner was OK to bribe but only if there was some work to be done. Most industry owners apply this convenient integrity principle because "Kya karein, dhanda karna hain") The officer went back empty-handed. Two days later, the business owner received a demand letter of 5 Lakhs from Excise Dept.
The owner waited until the officer's transfer & then met the new officer. Looks like the new officer was told about the incident during the handover. He too stood up for the honour of the department & dared the businessman to go legal. So he went to tribunal. But the law mandates payment of the demand amount to govt. before filing the case. This person had to deposit 5 lakhs & then proceed with the legal route. The Tribunal favoured the department & this businessman had to take the case to High Court. Finally, after 4 years of struggle, he got a favourable verdict. But then the bureaucracy made it difficult to get the refund. That took another 9 months. Finally, a new upright lady officer got transferred to that office & she promised him the refund in one week. But the office staff there continued his harassment & didn't make the payment. Seeing this businessman in her office even after one month, the lady officer called him & asked why was he there. "No refund yet," this guy said. The lady officer called her staff members & gave them a dress-down. This businessman got the cheque in the next 1-hour.
A refusal to pay Rs. 5000 cost the man hugely. The interest on 5 Lakhs (Govt doesn't pay you interest), the lawyers' fees & his own productive time lost in this battle. This is how corruption became a norm.
We all treated such payments as the small cost of doing business in India.
The question now for all of you is what has changed in one decade and what is still needing change.
Bring it on. more
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Corruption has not diminished in any way during last 10 years, degree may difffer. Individuals and business take this as normal expenditure as they don't want to waste time an energy besides actual cost since legal course takes years. As explained in this topic, Gujarat government allowed tax holiday to industries which put up their manufacturing plant in kutch area affected by devastating earthquake in Jan 2001. Many industries came up but ambiquity in state tax law left many FMCG companies depositing crores of rupess to get exemption. Representation made to the government led by the current PM in 2005/2006. After years of litigation, business got it right but at the cost of time, energy and interest cost. To get the refund, bribes were paid. This is just one of such cases. Black money thrives on in realty sector, currency market, bullion market to name a few. In land dealings, crores of rupees are being exchanged across India, besides cases pending in courts. Nothing is transparent. I know thousands of housing societies in Maharashtra do not have deeds in hand, lands are not conveyed, not endorsed in property cards, Similar in Tamil Nadu approval for land ownership is pending at various levels over a period of decades. To complete the same lacs of rupees are demanded. Hope LC addresses this issues and our PM actions at the earliest. more
Apr 23
In India no body is scarred of Law and Punishment. It starts from Top i.e. Politicians and Bureaucrats. See the news these days in MAHARASHTRA. Unless these are stopped totally, nothing can be expected to Improve. more
Mar 26
Political Support to Businessmen is the root Cause. IPC unimplemented. Policing Cornered. more
Mar 27
A compulsory raid by income or revenue department of all government officers, clerks, all politicians and past and present ministers would, result recovery of the loot, which, may be sufficient for India to be financially rich for next 100 years. This is the kind of corruption in India. more
Mar 15
Demonetization unearthed 17.23 lakh Fictitious A/cs; 2.43 lakhs CRORES Deposits ; 3.69 Lakhs Briefcase Companies in 2016-17.
THIS SHOWS, Lakhs of Crores Blackmoney is in the Banks, Bank Lockers and Concealed Properties.
POLICING; INCOME TAX; ACB; CVC; SHALL RAID AND SEIZE THE BLACKMONEY HELD.
This to be used for Education industry and Healthcare BY GOI. more
THIS SHOWS, Lakhs of Crores Blackmoney is in the Banks, Bank Lockers and Concealed Properties.
POLICING; INCOME TAX; ACB; CVC; SHALL RAID AND SEIZE THE BLACKMONEY HELD.
This to be used for Education industry and Healthcare BY GOI. more
Mar 16
The Govt. Officers & IAS Officers has got lot of Protection from Govt./ Dept. They get only transfer action with promotion. It is One of the Safest & Non Responsible Position in employment. If these protection get removed , Only Removal from the job with No compensation, No Interference from any political parties / goons , then only improvement will come. but it need to change present working system. more
Mar 15
