Running an Industry in India is Real Challenge
AFTER 11, 12 months, your temptation is to migrate to USA or elsewhere in the world...it is a legitimate desire...Indian human resources will find opportunities all over the world...seize these opportunities...spend few years...but please remember that there is no other place in the world which can challenge you (students) like India. Spend a few years wherever you feel whether in USA, Europe, Latin America, East Asia or Africa, but please remember it is only India and no other place that can challenge you (students). The greatest challenge is to build India .
This is a piece of advice by the Finance Minister Chidambaram to young talent from India while speaking at the Indian School of Business at Mohali.
A Netizen has reacted sharply and sent us this mail.
"Yes Sir!You are correct, running an Industry in India is a real challenge. The laws of this country are made complicated day by day in the name of simplification! The simplification of laws had led to strange interpretations by the departmental officers and Industry has to look for solace in the Courts of law. Piling up of cases in various Tribunals and Courts is the standing testimony for this. The tax administration in the country is in deep slumber having no empathy with the travails of Industry. There is no officer in the Tax Administration to clarify industry on technical issues and when it comes to decision making, the administration is always happy to err on the right side unmindful of the harm they are causing to the Indian industry.
A simple matter of interpretation raised by a lower level officer (an inspector) would end up in a Show Cause Notice and confirmation of demand by the adjudicating officers, all in the name of erring on the right side to save their souls.. The departmental adjudication mechanism has totally failed to deliver the goods and lost faith of the industry. Industry is spending huge money on avoidable litigation created by departmental officers who failed to apply their minds. No attempt has been made to check this malady and there is no mechanism to punish the officers erring on the right side without applying their minds that had killed many an industry. They get their promotions for the disservice they do to industry. Many officers in the department have a mistaken notion that the industry is established just to pay taxes or to evade taxes. This contrived notion has led all departmental agencies targeting the Industry and the assessees are in for receiving huge demands even on matters where law is not clear.
It is not surprising to know that there are issues where periodical notices are being issued for decades, just because AG audit has not closed the objection. For the department, a notice means a piece of paper, which can be pushed in to call book without deciding the matter for years, whereas for the industry it creates a liability pushing down his credit worthiness and may create working capital problems.
An inadvertent short payment of few hundreds of rupees of duty may result in clamping huge demands on an assessee because the Rule 8 (3A) of Central Excise Rules is interpreted to make no distinction between short payment and default. An entrepreneur has to run from pillar to post to save his property from threats of attachment, even though there is no merit in the demands confirmed against him. On top of it, there are draconian provisions for provisional attachments and provisions to recover dues even from the bank accounts, insurance policies etc. against the demands confirmed by officers blindly without applying their minds.
The mediocrity in the tax administration fails to appreciate the struggle an entrepreneur faces in running an industry. Though tax administrator is expected to be a facilitator for growth of Industry in the country, this never happens in reality. He is a troublemaker rather than a trouble-shooter. There is no mechanism in place to resolve the issues without taking recourse to adjudication process and endless litigation that is straining the limited resources of Industry. The knowledge (?) and experience of officers holding high positions in the hierarchy did not aid in any decision making process to help the Industry, justifying the positions they held and the fat salaries received by them from taxpayers' money. It is a miracle that Indian Industry is performing against all these odds and despite all forces working against them.
Dear Finance Minister, first create a healthy tax administration in the Country before exhorting young talent to come to India. Let them be happy wherever they are. This country is for politicians who face challenges only once in five years and not for industry for whom every day is a challenge to deal with tax administration."
(Please see the Central Excise and Customs Case Laws below)