S.O.S e - Voice For Justice -
Editor: Nagaraja.M.R.. Vol.08..Issue.30........28/07/2012
Editorial : CORPORATE
CRIMINALS / CORPORATE TERRORISTS / TAX THIEVES
RESPONSIBLE FOR ALL ILLS IN INDIA
However when a concerned citizen complains about the crimes of guilty corporates , organizations or corrupt public servants , immediate action is not taken. The file is kept pending for months , years together , allowing the criminals to manipulate all the evidences , records , ground situations. Finally even if action is taken guilty will be let out due to favorable evidences , there are chances that the concerned citizen himself is falsely implicated & put behind bars . in all such cases all the involved parties must be subjected to lie detector tests .
Bottomline : development is a must , it must be all around . but not at the cost of majority to make a few richer.
Jai Hind. Vande Mataram.
Maruti Suzuki HR executive Murder , PRICOL VP MURDER , SATYAM CO FRAUD , SINGUR AGITATION & GRAZIONO CEO MASS MURDER
- An eye opener to irresponsible corporate India & GOI
Few Days ago , a senior HR executive of M/s Maruti Suzuki Ltd , Manesar , Haryana was burnt to death by workers. Few Years back , in the state of tamilnadu India , some of the sacked laboureres of M/S PRICOL INDUSTRIES mass lynched & murdered a higher management official , for sacking them from their jobs. This act of laborers is a heinous crime , illegal & inhuman act. In India , nowadays the labour movement has been hijacked by lumpen elements , rowdies , criminals. These criminal elements are there in the posts of union leaders just to further their self interests rather than the welfare of the workers whom they represent. These lumpen elements , so called leaders thrive on controversies & creates disturbances , vitiates harmonious relations between the management – workers. The company as an organization needs team work to survive & thrive in business. These labor leaders even oppose for example OUTPUT BASED PRODUCTION INCENTIVE SCHEME – which is a win win situation for both the management & workers. These leaders go to the extent of killing the hen which lays golden eggs , all for their selfish gains. These rowdy leaders become leaders just to make money , to make political entry , to shirk-off work , to escape night shift work , etc. In the midst of these rowdy elements the genuine concerns of ordinary workers are not at all heard. The ordinary workers who depend on the organization for their livelihood , who work hard to earn more incentive , are the ultimate sufferers.
In the same manner , the management of companies must be sensible to the genuine concerns of it's workers , it must properly balance the worker's concern & company's position . some of the managements enforce harsh rules on workers , o.k , the management personnel of those very same companies function without discipline , misuse company properties , siphons of company money , take commission from vendors , cheat the government of tax dues , violate environmental laws , tax laws , labor laws by bribing officials , etc. Finally this kills the organization as a whole – the end losers shareholders , lending banks , government & our economy.
The recent public agitation at singur west Bengal , India against the TATA NANO project , is nothing but a struggle for survival by the land loosers. The public of singur are living there since ancestral times , they fully depend for their livelihood on the vegetables & other small crops grown there by them. The livelihood , their survival is at stake. The irresponsible west Bengal government , to favour the corporate lobby , acquired the lands forcibly dirt cheap & gave it away at dirt cheap price to TATA'S. why such a cheap , long term lease period has been given to TATA'S ? The government literally has thrown the land loosers on street , it didn't bother about their survival nor about their proper rehabilitation . Basically , TATA'S is a business house , their only intention is to make profits , more money , not the welfare of people. Why not TATA'S acquire land in open market ? the acquire of lands by state or central government for public good like for building dams , roads , channels are at least justified however the rehabilitation is more important. Other than for the projects concerning public good , for all the projects of private enterprises like pay & use roads , airports , industries , etc , the lands must be acquired in the open market at market prices . For some industrialists bid to make riches , lives , livelihood of thousands should not be sacrificed. It is not alround development. In a democracy , the voice of the public , locals should be honoured but not the diktats of ministers or babus in secretariats. The present corrupt system in India leading to rise of naxalism , underworld , separatist movements are all due to the government policies since independence till date according to the wisdom (?) of ministers & babus , totally dishonouring the public voice.
Now , take the case of Graziono CEO mass murder in noida , it is nothing but fallout of hire & fire policies. Every human being works for survival , on his meager salary there will be family dependents , all of a sudden if a person is fired from service , his whole family will be on streets. O.k , all corporates nowadays preach & breath the mantra of USA , for everything be it infrastructure , flexible labour policies , it compares itself with those prevailing in the USA. Now , the corporate India is getting infrastructure at dirt free prices ( very high in the USA ) , has got hire & fire mechanism by employing contract labour , very lenient environmental norms , very lenient food & drugs safety rules , relaxation in Factory Act , ESI & PF acts , etc add to it the rampant corruption in all govt departments by which you can get any certificate for a price.
In the USA , of course there is hire & fire policy , however the minimum wage levels are also very high , so that during good times workers can save money for their future. Also , there is social security net to take care of ousted workers , then why not Indian corporates paying good salary to workers during good times ? why not corporate India making good contribution to social security net ? in the USA , there are good infrastructure facilities they take pride in paying taxes to the government , the corporate India always lobbies for tax cuts , subsidies , loan waivers , etc. in the USA the environment norms are very strict , the companies manufacturing hazardous chemicals which were ousted by the US government have set up shop in India . Government of USA treats lives of people as precious , where as Indian government treats lives of it's people as dispensable. In the USA , the food safety & drugs , medicines safety standards are very high , the drugs , high level adulteration food products banned by Government of USA are sold in the India , this is the difference between government of USA & India , the way they treat their people's lives. Loan recovery , investor safety norms are very high in the USA , where as in India , loan defaulters , share holder swindling , Non Performing Assets is very high. Inspite of all the strict norms we have seen enron , Xerox debacles in the USA & recent bank fallouts in the USA. In India with such lax norms , only you can guess.
The lesson here for the government of India is , development must be allround , must not be at the cost of thousands. Listen to the voice of public but not to the commands of greedy selfish corporates , lobbies . Do stop thinking that only babus , IAS officers & minister are brilliant knowing all and the public people are fools fit to be herded by IAS officers. Do remember that India is a democracy not a BANANA REPUBLIC.
The lesson for corporate India , aping the USA intoto is O.k , but not by parts & bits , follow corporate USA in every aspect of corporate duties & responsibilities , transparency.
Final word , when it comes to the question of survival , life , livelihood , it know no bounds . After all STRUGGLE FOR SUVIVAL is a basic animal instinct , it is a basic human right of every individual .
CORPORATE ACCOUNTABILITY IN INDIA
CORPORATE FRAUDS IN INDIA
Corporate fraud is nothing new to india , satyam company is just a new addition to it. Satyam co was able to commit such a huge fraud & keep it under wraps for years goes to prove the honesty , integrity of our public servants , government officials belonging to SEBI , RBI , tax dept , pollution control , labour depts. , etc & the honesty of auditors & company secretaries. Ofcourse , still there are few honest people in public service , auditing & company secretaryship , but majority of them are hand in gloves with corporate criminals. Definitely , this fraud will also be brushed under the carpet after certain time as other frauds happened , afterall these frauds are the money spinners for political party funding , mafia , underworld & other criminal activities.
IN INDIA , government reports , records , everything can be bought for a price. During Karnataka lokayukta raids huge wealth amounting crores of rupees were found with each of the corrupt government officials like police , engineers , tax officials , etc. How those government officials with few thousands of salary earn so much , by compromising with their government duties , by creating fake government reports , records , etc . The government & the courts of justice treat those government reports , as sacrosanct like TEN COMMANDMENTS DIRECTLY FROM THE MOUTH OF GOD HIMSELF.
The CORPORATE CRIMINALS & RICH CRIMINALS buy favourable government reports , records from the government officials commit bigger crimes , escapes from legal prosecution by proving their innocence , honesty with the aid of BOUGHT GOVERNMENT REPORTS & RECORDS. The courts of justice lacks broad vision , it has only narrow vision as a riding horse's vision is narrowed . courts of justice is only bothered about technicalities , evidences , records , it lacks the spirit of QUEST FOR TRUTH , it lacks truth finding mechanism out of massive reports , records , evidences. The rich criminals are in a position to manipulate , buy out evidences , government reports , so definitely they will escape from hook. Today , I can convincingly state that our legal system is such that , even the terrorists who attacked our TEMPLE OF DEMOCRACY - THE INDIAN PARLIAMENT will be let free , when they can fully buyout evidences , reports , etc.
In this backdrop , the corporates technically maintain clean public image although privately they are frauds , criminals. If anybody makes a statement of truth against them , those corporate criminals will slap defamatory & other criminal charges against such persons. The courts of justice upholds the claims of not the speaker of truth but the corporate criminals , on the basis of bought evidences , government reports. The courts doesn't go into the truthfulness of those reports , evidences & sends the speaker of truth to prison. If any person has made any complaints of fraud against Satyam Co , two months back he would have definitely faced criminal prosecution & jail term. As all the records , auditor reports , company secretary report , reports of ministry of company affairs , reports of tax departments , everything was in it's favour. The courts are only bothered about evidences , records which were all in satyam's favour , the courts are least bothered about quest for truth & justice. In this manner in India , there are hordes of private companies where frauds have taken place & taking place & wiil be.
Just recently after Ramalinga raju's own statement , does it became public that the reports of auditor , company secretary , related governmet records are all false. Base linbe everything was bought. Do remember that whether it is SATYAM FRAUD , ENRON SCAM or XEROX SCAM , those were not found , revealed either by our investigating agencies or the government. Satyam's Fraud came to light due to pressure created by the recession , market forces on the company's promoter Mr.RAMALINGA RAJU & his resultant confession , Enron scam was unearthed by US investigators in USA during the corse of their investrigation , It is the same with XEROX Co . till those revealations , those companies were good , legally abiding cos in govt records. THAT MEANS THEY HAVE BOUGHT OUT INDIAN LEGAL SYSTEM EFFECTIVELY.
In this manner , in India most of the entrpreneurs small shop owners to big corporates buy out tax officials , labour department officials , pollution control board officials , etc & openly indulge in unfair , illegal trade practices , labour practices , legal violations , etc , still go unpunished , as as per book , the government records they are law abiding , persons , corporates.
Entrepreneurs , promoters of big corporations collect public money either through shares , debentures , bank loans or all . so ideally public are also stake holders in such companies . The criminal entrpreneures , promoters siphon-off companies resources in various ways like selling company assets to their sister cos at a lesser value or purchasing assets from sister cos at a higher value , giving loans to sister cos at low interest rate or taking loans from sister cos at higher interest rate , etc. in this way they siphon-off resources of public companies / enterprises with bank loans to their own family owned sister cos. We at e-voice of human rights of watch are ready to catch such corporate criminals & help the government , ofcourse subject to conditions , are you ready ?
In india , tax compliance is worse. In our criminal justice system, there is rigorous imprisonment for a pick-pocketer stealing Rs.10. even the authorities spend thousands of rupees in legally prosecuting him & the thief spends a year or more as punishment behind bars. Where as there is no commensurate investigation nor legal prosecution nor punishment for corporate thieves , evading tax to the tune of crores of rupees. In contrast, those tax thieves pay a part of that booty to the ministers & political parties and get crores of rupees tax exemptions , incentives from the government. Government is rewarding corporate criminals.
The tax officials of central & state governments are hand in glove with these corporate criminals & traders. For a price, they are helping corporates & traders in evading tax. Most of the tax officials are wealthy & leading luxurious lifestyles , much beyond the scope of their legal income. The black money thus generated every year by tax evasion , is many times more than our total annual budget allocation. As a result, all our fiscal reforms fail & inflation is soaring. This black money is the source of illegal funding of political parties , terrorist outfits & underworld. It is a greater threat to national unity & integrity.
Both the central government & karnataka state government have failed to collect the full , actual tax dues from corporates & traders. As a result , the governments don't have enough money in their coffers even to provide basic needs like health care , education , safe drinking water , etc to the poor & needy. For every Rs.100 tax evaded , one poor patient is dying without medical care , 10 poor persons lack education , 100 persons don't get safe drinking water , 100 persons barely survive on a single piece meal per day , 20 persons starve. Most of The government officials , ministers & people's representatives who have deliberately failed in their duties of tax collection & welfare of poor citizens , SHAMELESSLY indulge in luxurious lifestyle at the expense of poor tax payer . they live in paltial bungalows , chauffer driven AC cars , all living food expenses paid by exchequer , dine at 5-star hotels , only drink bottled mineral water , eat non-vegetarian dishes , drink alcohol sitting before mahatma gandhi's photograph & preaching mahatma's ideals. Mahatma preached & practiced simple living , vegetarianism & he was teto teller , he paid for his expenses from his earnings . these public servants are parasites , who are making merry at the expense of tax payer.
Some non government organisations ( NGO) have formed trusts and under the aegis of those trusts are running educational institutions , hospitals , community halls , etc , in the name of providing free / subsidised services like education , health care , etc to the poor. It is only in record books , they conduct fake medical camps , self employment training camps . in practice they are running these educational institutions , hospitals & community halls as commercial enterprises & collecting huge fees. they are not even remitting full fees collected to the trust account & swindling the money. no outsider is allowed to become a member of these NGOs , only their cronies & their family members are in these trusts.
Numerous NGOs promoted by religious bodies , mutts are swindling public & government money to the tune of crores of rupees. Nobody dares to question the heads , pontiffs of these mutts , as at his feet VVIPs , ministers fall down. These religious bodies are hot beds of fundamentalism , terrorism & mafia. Hwere is the accountability of religious bodies & political parties in in india ?
Inspite of bringing specific cases to the notice of authorities , they are mum ? hereby , E-VOICE OF HUMAN RIGHTS WATCH offers it's services ( subject to conditions ) to the governments of india & karnataka , in apprehending the criminals – tax evaders. Are you ready mr. singh sir & mr.Yediyurappa sir ? If you are ready to do your duty look into the following cases , take appropriate action & kindly inform me about the outcome.
WHY MULTINATIONAL COMPANIES ARE INVESTING IN INDIA?
We condemn the brutal massacre by police on farmers – who are going to loss all their lands , sources.of livelihood for the sake of special economic zones , industrial parks , etc in various states of India.
In every mega projects undertaken by government , both the state government & central government have functioned like REAL ESTATE / COMMISSION AGENTS for the rich & mighty . the government says it is acquiring lands for development of industries , for public good. In reality there is only good of rich & mighty.
For forming S.E.Zs , corporates gets speedy single window approvals from government , lands at concessional rates – lower than market value , soft loans from Indian banks , tax exemptions for years from the government , dedicated power supply , etc , from the government . these corporates are even given free hand to raise share capital in the Indian market. the government has enacted flexible labour laws specifically for S.E.Zs , they can hire & fire without bothering to pay gratuity , etc and they are exempted from providing P.F / E.S.I coverage to their employees ie they need not worry about the occupational health hazards of their employees , they can employ them till they are fit & throw them on streets afterwards. These corporates take our own money, employ our own people , use our own natural resources & finally take away the net profits to their home countries – what they give back ? – environmental pollution , tax evasions , low paid occupational hazardous jobs to locals , stock market scams .
They are not bringing in new production technologies in the areas like space research, nuclear energy, bio-technology, pharmaceuticals or pollution control, to India. Also, some MNCs are relocating their highly polluting industries to India, as they are subjected to stringent environmental protection standards in their own home countries. Whereas, In India the Government is highly corrupt & can be bought for a price. The attractive points for foreign direct investment (FDI) in India are,
INDIAN CAPITALISM ALWAYS HAD A CRIMINAL SIDE - By Praful Bidwai
The Satyam [ Get Quote ] scandal has been wrongly called 'India's Enron', after the gigantic fraud at the US energy-trading company, which came to light in 2001 and became a metaphor for corporate crime.
In fact, the Satyam scam is much bigger in absolute magnitude and likely impact. The amount stolen from Enron was Rs 2,866 crores (Rs 28.66 billion) at current exchange rates. In the Satyam case, according to its promoter-chairman B Ramalingam Raju, Rs 7,136 crores (Rs 71.36 billion) were involved. Also greater are the number of defaulting agencies and their failures.
The impact of the Satyam scandal won't be confined to the 53,000 people on its payroll -- a number higher than the 40,000 Enron employees. The entire Information Technology industry will be singed by the swindle just when the global economic slowdown is already hurting it. The World Bank's ban on IT-India's No 3 Wipro [ Get Quote ], and Megasoft, besides Satyam, for unethical practices will further aggravate the industry's difficulties.
The Satyam swindle has tarnished the image of India's [ Images ] IT industry and cast a shadow over its remarkable 30 percent annual growth, which is generally attributed to virtuousness, brainpower and hard work, not inherited wealth. It has lowered the profile of Andhra Pradesh as a land of gutsy businessmen -- fondly paraded by successive chief ministers as 'Andhra-preneurs' -- who combine a robust native business genius with a modern extrovert outlook.
Above all, the scam has exposed huge cracks in India's corporate governance structures and system of regulation through the Securities and Exchange Board of India, SEBI, ministry of corporate affairs and the Serious Fraud Investigation Office. Unless the entire system is radically overhauled and made publicly accountable, corrupt corporate practices will recur, robbing wealth from the exchequer, public banks and shareholders.
The Andhra Pradesh government has treated Mr Raju with kid gloves. It failed to arrest him for three days after he made a public confession, thus giving him time to sanitise/destroy incriminating evidence. His detention by the state police means that SEBI has been effectively barred from questioning him. This has bred speculation that Mr Raju has cut a political deal under which his family would be protected and certain officials rewarded. The Centre too is preparing to spend Rs 2,000 crores to rescue Satyam and public sector units haven't shifted their IT operations to other companies.
Mr Raju's January 7 confession and surrender to the police should fool no one. Contrary to his earlier claim that 'neither me, nor the managing director (his brother) took even one rupee/dollar from the company...', he now says he has been cooking Satyam's books for seven years.
He is estimated to have made Rs 2,065 crores (Rs 20.65 billion) by artificially jacking up the price of Satyam's shares and selling his holdings (14 percent of the total). Satyam's Chief Finance Officer Vadalamani Srinivas has said the fixed deposits shown in the books were fictitious.
We still don't know the scam's true dimensions. But two things are abundantly clear. First, it's extremely doubtful that Mr Raju inflated Satyam's income by Rs 5,000-plus crores (Rs 50 billion) and even put in Rs 1,230 crores (Rs 12.30 billion) of his own money. It simply doesn't stand to reason that he would do this and not siphon off large sums. Equally dubious is his claim that Satyam's operating margin was as low as 3 percent, compared to the 25 to 30 percent for top-ranking IT companies.
If Satyam's margin was indeed higher, then thousands of crores were spirited out of the company. It is imperative that this trail is rigorously traced. It would be surprising if it doesn't lead to real estate scams or to benami accounts held by politicians. Former Union revenue secretary E A S Sarma, a public-spirited civil servant of exceptional integrity, has tried to find some of these tracks through the Right to Information Act, RTI.
He looked at a private company which is building Gangavaram Port in Andhra and found that 18 percent of its equity is held by Lakeside Investments Ltd, a Mauritius-based company, 'apparently... a smokescreen for tax evasion.' Mr Raju reportedly owns a company with a similar name, Lakeview Investments, and with the same address.
Mr Sarma has also raised serious questions about the way the state has handed out thousands of acres without competitive bidding to Maytas (Satyam spelt backwards) Properties and Maytas Infrastructure. Maytas Infra alone has projects worth Rs 30,000 crores (Rs 300 billion) in Andhra, including the Rs 12,000-crore Hyderabad metro rail and irrigation projects worth Rs 13,000 crores (Rs 130 billion). All this warrants an in-depth investigation.
Secondly, surrendering to the police in India was Mr Raju's best guarantee against extradition to the United States, where numerous criminal cases have been filed against him and where the punishment will be more rigorous and prompt than in India. For instance, Enron's Kenneth Lay was charged on 11 counts and set to be sentenced to 45 years in jail when he died.
If Mr Raju is tried for criminal breach of trust in India, he could get away with as little as three years. Even if he gets a life sentence, he may end up spending 10 years or less in prison.
The Satyam swindle became possible because all supervisory mechanisms failed, including the statutory auditor, PriceWaterhouseCoopers, PwC, independent directors, and SEBI. PwC didn't verify the authenticity of the account-books. It had similarly failed with Global Trust Bank, which collapsed. Irregularities were noted in PwC's handling of Satyam accounts in 2001, but mysteriously, no probe was conducted.
Similarly, a complaint was filed with SEBI by Member of Parliament Ramdas Athavale in 2003. But under political pressure, this was not pursued.
PwC, which has audited Satyam's accounts since 1991, is guilty of grave misconduct and should have faced punitive action from the Institute of Chartered Accounts of India, ICAI. Ironically, PwC has two members in the ICAI disciplinary council!. The council met, but failed to take action against PwC. ICAI, like the Bar Council or Medical Association of India, shields, and rarely acts against, even the most errant of its members.
Satyam's independent directors did no better. They asked no questions about the accounts When the board met last month to approve the scandalous proposal to invest $1.6 billion in Maytas, it didn't even refer to the conflict of interest in buying a company in a completely unrelated business, floated by the promoter. It only went into technicalities of conformity with SEBI guidelines, and valuation of assets. Indeed, one of the independent directors, Krishna Palepu of the Harvard Business School, waxed eloquent on the merits of real estate investment.
These directors collect fat annual fees ranging from Rs 13 lakhs to Rs 92 lakhs (Rs 1.3 million to Rs 9.2 billion) just for attending a few meetings, but clearly lack independence. Many independent directors in India see board memberships as sinecures or lucrative pastimes unrelated to corporate governance and public responsibilities.
Even worse was SEBI's failure to investigate Satyam and refuse to approve its patently foul transactions including the Maytas deal, which was aborted by investor protests. SEBI also ignored a December 18 letter on Satyam sent by Mr Sarma. Other authorities also turned a blind eye to various complaints about the illegal allocation of 17,000 acres of land to Satyam group companies in different cities, in violation of their master plans.
India lacks adequate corporate regulation, and its enforcement is pathetic. For instance, as many as 1,228 of the Bombay Stock Exchange's [ Images ] 4,995 listed companies have failed to submit reports required by Clause 49 of the Listing Agreement, including information on their boards' composition, audit committees, CEO/CFO certification of accounts, and related-party transactions and subsidiary companies.
Corrective action is overdue if corporations are not to cheat stakeholders and the public. Indian capitalism has always had a criminal side to it. Our corporate nabobs often milk their companies by appointing procurement and distribution agents, by under- and over-invoicing imports/exports, evading taxes, indulging in insider trading, and dressing up balance-sheets. Satyam fits this pattern, which is widely prevalent in most brick-and-mortar companies.
Some corrective steps are self-evident. Statutory auditors aren't enough. We need a Board of Audit, which like the Comptroller and Auditor General of India, is authorised to conduct surprise audit on its own or on whistle-blower complaints. Besides, no auditor should be allowed to continue beyond three years.
The government should create a pool of independent directors from amongst citizens of high integrity. Impartial authorities, not company managements, should appoint them and fix their remuneration. Cross-directorships must be banned. All agent appointments must be thoroughly scrutinised. Penalties must be stiffened. The conviction rate in corporate frauds, currently under 5 percent, must be improved.
Breach of trust and fraud must be heavily penalised. If an auditor fails in his duty in India, he faces a ridiculous penalty of Rs 10,000 and maximum imprisonment of 2 years. The US Sarbanes-Oxley Act, passed after the Enron and WorldCom scandals, awards imprisonment for 20 years. The US has greatly improved fraud detection by reforming audit methods and offering incentives to whistle-blowers.
We must learn from all this and acknowledge that deregulation promoted in the name of 'trusting' CEOs and creating a 'favourable investment climate' is dangerous.
Is the Satyam scandal just about a promoter manipulating the financial statements of his company to show a superior performance? Or is it about systematic siphoning of funds from the company over the years? Emerging events seem to increasingly point to the latter.
Let’s start with the so-called “confession statement” of Mr Ramalinga Raju, the disgraced chairman of the company. Lawyers have already expressed doubts over whether the statement can actually be deemed a confession and enough to implicate Mr Raju. Indeed, they say that it is a very well drafted document designed to draw attention to the hole in the finances without implicating himself anywhere for any act of commission.
A careful reading of the statement shows that there is indeed merit in this view. Mr Raju has pointed to cash balances not being the same as reported in the audited financial statements, he has said of how revenues were inflated, and so on. But nowhere has he said that he was responsible for this nor has he pointed his finger at anyone else. Of course, as the chairman, the buck stops with him but that is not the same as saying “I did it”.
If anything, he has tried to project himself as the saviour by pointing out how he “arranged” Rs 1,230 crore for the company and how neither he nor the managing director “took even one rupee/dollar from the company and have not benefited in financial terms on account of the inflated results”.
Mr Raju appears to have attempted to deflect attention from what is possibly the more serious crime of siphoning of funds to the relatively lesser one of accounting skulduggery. This is being clever by half. How on earth did he think that the shareholders, lenders, legal agencies and the world at large would believe him on this?
People who were and are working in responsible positions in Satyam say that the company has a real business going and some of its divisions are extremely profitable and there is no question of doubting the revenues from them. There is no way that operating margin will be as low as 3 per cent, they say, unless of course, if money had been sucked out of the company.
The second event that raises doubts is the carefully orchestrated arrest of Mr Raju. He surrendered himself to the police the night before he was to appear before the SEBI investigating team. The arrest and remand ensured that SEBI was unable to interrogate him.
The market regulator will eventually be able to quiz him, but the question is: Will there be evidence destroyed before that? As it is, there is the possibility that Mr Raju may have destroyed crucial evidence implicating him before he went public with his “confession”.
And then, there is the political angle to the scandal. Mr Raju and his companies (Maytas group) have been beneficiaries of large public contracts for transport systems and irrigation projects in Andhra Pradesh. Nexus between businessmen and politicians is an accepted reality in this country. So is someone powerful attempting now to protect Mr Raju? Or is it that he knows too much about wheeling-dealings and hence needs to be kept away from investigators?
Allegations and counter-allegations have been flying thick and fast from both the ruling and Opposition parties in Andhra Pradesh over favours, secured and shown, to Mr Raju by both. The government appointed board has a task on its hands. It will have to dig, and dig deep to unravel the scandal in all its dimensions. What is now out in public is probably just one dimension and it may be the least scandalous one. Mr Raju has himself said that the irregularities have been happening for years. Therefore, it is only correct to assume that more skeletons will come tumbling out once SEBI and the Company Law Board bury their noses into the books of Satyam.
There is the danger though that political pressure will be brought on to scuttle the investigations or obfuscate the findings. This is where the government-appointed board will assume importance. Not only will the government have to appoint people of integrity and high standing but these people will have to discharge their responsibility of getting to the bottom of this scandal without hesitation or fear.
ICAI to take stock
Finally, a word on the auditors, Price Waterhouse. The Central Council of the Institute of Chartered Accountants of India (ICAI), regulatory body of the accounting profession, is set to meet on Monday to take stock of the developments from the Satyam scandal on the profession.
Interestingly, two members of the Central Council, Mr S. Gopalakrishnan and Mr Harinderjit Singh, are senior partners of Price Waterhouse. Mr Gopalakrishnan signed the 2006-07 balance sheet of Satyam. Will the two gentlemen sit in on the deliberations on Monday at the ICAI? Or will they opt out on grounds of conflict of interest? Or better still, will they resign from the Central Council, which is the policy-making and governing body of the ICAI? Is it too much to ask for the last?
Source / courtesy: The Hindu
India: Descent Into Darkness
By Colin Gonsalves
In the 61st year of the republic, surely, India has transited into Kalyug. Surveys of the Union of India as well as expert reports published by the Arjun Sengupta committee and the NC Saxena Committee appointed by the Central government reveal that almost 77 per cent of the population in India are below the poverty line in terms of the food intake minimum standard of 2,400 kilocalories (kcal) per person per day, a standard set by the Planning Commission in 1979.
Over 50 per cent of all women and children are malnourished with 17 per cent of the child population being so severely malnourished that a whole new generation of Indians will become adults with malformed brains and stunted growth. Even in the urban areas where conspicuous consumption is always on display, malnourishment of children is upwards of 50 per cent.
This is the spectre of starving India.
For the top 20 per cent of the population (and less than 3 per cent of the sensex/stock market) who have experienced the licence to loot, corrupt and cheat during the ongoing period of globalisation, this is Satyug. Since the beginning of the decline of Nehruvian social democracy in the early 1990s and the establishment of what is called the liberalisation regime, the rich have never had it so good.
A seismic shift has taken place in the thinking of politicians, corporations, administrators and judges, fuelled partly by international capital and the devious planning of the World Bank and the IMF. Whereas earlier and in accordance with the constitutional mandate, the country was to be taken along as a whole, the resources of the State were to be used to subserve the common good and a reasonable part of the gross domestic product (GDP) was to be kept aside to subsidise education, health, food, housing and transportation for the working people. With globalisation all this began to change drastically, systematically and with abject cold-blooded deliberation.
Education for all was quickly jettisoned with the argument that it is impossible to educate so many poor children, that it is inadvisable and unproductive to spread resources thinly and that since in any case the middle classes are the engines of change, State resources ought to be concentrated on them if the GDP is to be pushed up. Thus, while fancy educational institutions multiply and students’ fees rise many times over, poor students learn under trees or in the open (in freezing cold or scorching summer) without schools, textbooks and often without teachers and the officially promised mid-day meals.
The Supreme Court in TMA Pai’s case, made a disgraceful decision opening the doors for commercialisation and privatisation of education and casting a shadow on the earlier decision in Unnikrishnan’s case correctly providing for strict State regulation and prohibition on commercialisation.
Similarly, while some of the finest health facilities in the world sprung up in the cities of India, government public health facilities went into a tailspin. The public health centers lacked medicines, doctors, testing equipment, beds and food for poor patients. As the despair with public health care is increasing, the World Bank merrily came along with its prescription for “user fees” requiring people below the poverty line to pay for health services. Dalit or poor women delivering on the pavements outside government hospitals became a common sight.
Despite the jurisprudential exhortation that the right to public health care, free drugs and indigenously manufactured medicines is a fundamental right under Article 21 of the Constitution, the rot set in and is too deep to reverse. How does it matter and what effect could it possibly have on the GDP if tens of thousands of poor people suffer ill health or die of malaria or tuberculosis? From the GDP point of view, health care for the poor simply does not matter.
The shift in ideology away from social democracy towards what was quaintly called ‘globalisation’ affected the judiciary as well. Senior judges who were derisive of the post-independence emphasis on ‘egalitarian socialism’ used the enormous power of the judiciary to undermine social policies of the government, bypass binding precedents and generally stripped the working people of constitutional law protections.
In the Steel Authority of India Limited case, the Supreme Court made it possible for capitalists to convert their entire labour force into contractual labour, thus effectively taking away all their protection under labour laws. In Uma Devi’s case, persons who were employed and were working for decades in permanent work positions on a pittance, were denied regularisation, thus giving a legal cover to slave labour.
Marvelous environmental jurisprudence meticulously put in place by Justice Kuldeep Singh and others in the Supreme Court was systematically dismantled by subsequently appointed judges in the superior courts who had a pro-capitalist bend of mind. They saw environmental law and environmental activism as an irritant which hindered the ‘development’ of the country. They, therefore, used the quite dubious doctrine of ’sustainable development’ in an even more suspect way to allow for all kinds of environmentally destructive industrial activity, quite unmindful of its catastrophic and long-term effect on the environment.
As a result, India today is in the process of being completely devastated. The forests have been decimated in many parts indiscrimately for big projects, the cities are polluted, lush green areas have been mined, the rivers of India turned into sewage drains and water shortage has become so acute that in the years to come social upheavals will centre around this acute deprivation. The great Indian nation is being turned into a desert with its sacred rivers becoming dirty drains.
When the tribals, dalits, workers, slum dwellers and the dispossessed of this country protested, often feebly, they were met with fierce repression. Police torture is widespread and has become the principle forensic tool for the investigation of crimes. Nowhere in the world, perhaps, has the police force turned into such an awesome body of ruthless creatures in uniform, as in India.
The average rate of conviction in the country in cases of atrocities against Dalits has sunk to 1 per cent. As a result, rape of Dalit women, murder of Dalits, destruction of their houses, burning of standing crops, robbing of cattle, destruction of Dalit temples, throwing excreta inside wells, untouchability and practices such as the two tumbler system, continues unchecked till this day while the justice system seems immune.
Despite the right to housing being declared a fundamental right by the Supreme Court in Nawab Khan’s case and although the UPA manifesto specifically includes a ban on forced evictions of slums, about a million of the urban poor every year have their homes bulldozed without notice, compensation or rehabilitation to make way for the skyscrapers of the rich.
All this does not auger well for the legal system in India, one of the main pillars of the democratic State. The working people shy away from the courts and participate reluctantly when they are dragged into the legal system through coercive proceedings. Labour court proceedings throughout the country have shrunk by 75 per cent and the once vibrant institutions that balanced the interests of capital and labour have become stultified. Tribals shun the courts. Even the most serious of crimes like rape and murder make the victims approach the courts with grave reluctance.
This is not difficult to understand as the legal system operates just like a colonial power, as an engine of oppression. Probably, one million false or trivial cases are pending in the Indian courts against innocent tribals who are forced to attend court and loose their wages day after day. It took a Maoist uprising for PC Chidambaram, the Union Home Minister, to understand this elementary truth and announce the withdrawal of one lakh cases filed by the State against tribals in Jharkhand alone.
Decisions of the Supreme Court under the Land Acquisition Act have made possible tyrannical state acquisitions of land throughout the country making the vast majority of Indian farmers suspicious of the legal system. With regard to as elementary and established a right as a woman’s right to maintenance, the woes of women in family court matters seems never ending.
The State just can’t get its act together to enforce the appointment of judges although it is now well settled that India has one fifth the number of judges that it needs. Delays are not accidental, they are intended. The legal system is designed to tie the litigant up in endless and expensive proceedings where justice is illusory.
Public Interest Litigation, which is the only lifeline between the judiciary and the people of India, is being denigrated time and again and not unexpectedly because there are those who believe that the legal system is best used for sorting out property disputes and commercial matters. Legal aid has been reduced to a farce of seminars with the presentation of bouquets. In death sentence cases involving destitute persons, the legal aid lawyer may even miss a cross examination or two.
It is sometimes all too easy to blame judges for the ills of the legal system. If one turns to the quality of the Bar, one would notice all kinds of elements wearing bands and gowns and committing all kinds of illegalities. Criminality pervades many parts of the legal system.
Between democracy and darkness stands the judiciary. It stands heads and shoulders above the judicial systems in Asia. But it is in rapid decline. Ahead is pitch darkness.
This is the period of Kalyug. The lust for money that globalisation brought with it has decisively depleted spirituality, morality, collective sharing, equality and social justice. It has only institutionalised a spiraling network of stark and relentless injustice. Only a national uprising will reverse this trend.
[The writer is a senior lawyer, Supreme Court of India, and Founding-Director, Human Rights Law Network]
Top 10 Financial Scams in India
- Siddharth Singh
Financial scams have a habit of cropping up with an alarming regularity in the Indian financial system. We have reconciled to financial irregularities to such an extent that we simply do not pay heed to smaller scams that take place around us on a daily basis. I am, or rather was, a part of the financial machinery for a few years, and trust me, even the private sector is not entirely free of the machinations of unscrupulous and enterprising scamsters. The scope of the money involved multiplies manifold in the public sector, with a corresponding drop in accountability.
Financial Scamsters Are Rarely Punished
Despite a plethora of scams that surround us on a daily basis, frequently scams of large proportions come to light, and manage to stun even our jaded sensibilities. Then, there is the usual round of allegations, counter-allegations, enquiries and legislation. Some of our most notable regulations and financial institutions are the results of such scams.
I have compiled a list of ten leading financial scams in India, which have affected a large population of investors, and involved huge sums of money. They managed to shake the very foundations of our financial system, and were driven by that most basest of human instincts – GREED. In most cases, it was the greed of just one individual, or a very small group of individuals, who managed to pull of such huge scandals.
Insurance Scam – This scam had originated and prospered in the period immediately following Independence in 1947. At that time, the insurance sector was not nationalized, and a handful of private companies ruled the roost. These companies were more concerned with providing benefits to selected industrialists, and ignored the interests of the common man. The government responded by nationalizing the insurance sector, and the LIC was founded under an special Act passed by the Parliament. This scam laid the foundation of the nationalization culture in India.
Securities Scam – Harshad Mehta – This is perhaps the most well known of all financial scams – probably because it happened in a highly visible period – economic reforms had just been started in 1991. Harshad Mehta was quick to understand the weaknesses of the banking system, and exploited these weaknesses to the hilt. He managed to procure huge amounts of money using the so called “Ready Forward” deals, and used this money to purchase large amounts of shares at hugely inflated prices. He earned the sobriquet of “Big Bull” due to this penchant. Later, the banks got a clue of his shady deals, and demanded their money back. The house of cards collapsed, and the rest, as they say, is history!
CRB Scam – This scam took place in the years 1992-1996, the period immediately following the Harshad Mehta fallout. This makes the scam even all the more daring and surprising. CR Bhansali, the perpetrator of this scam, floated more than 100 companies, such as CRB Mutual Funds and CRB Capital Markets. The primary purpose of these companies was to attract huge funds from the public by promising high rates of interest. This interest was later paid form further borrowings, and so on. In 1995, the stock market collapsed, and this proved to be the undoing of CR Bhansali. He was investigated, and later arrested. After a brief 3-month stint in jail, he has disappeared without a trace, and nobody is asking!
UTI Scam – The UTI scam involved the flagship US-64 scheme of UTI, which was meant to channel the funds of small investors into instruments bearing high returns. Gradually, US-64 developed a investor base of around 2 crore investors. The economic liberalization in India, coupled with the absolute opacity in the operations of UTI, led to a situation wherein the Government was forced to announce a huge bailout of about Rs 3,500-4,000 crores in an order to prevent default in payments to the investors. The consequences of such a situation are unimaginable. But the story does not end here. Later, it turned out that the UTI Chairman appointed at this time, Mr P S Subramanyam, along with a couple of executive directors, acted wrongly to selectively benefit a powerful coterie of brokers and industrialists, while at the same time, jeopardizing the interest of lakhs of small investors.
Home Trade – Around the year 2000, a finance portal emerged on the financial landscape, and gained quick recognition on the back of endorsements by personalities like Hrithik Roshan, Sachin Tendulkar and Shahrukh Khan. The portal, owned by Sanjay Agarwal, claimed to deal in gilts. Soon, RBI got suspicious of activities of some cooperative banks in the gilt market, and a scam was uncovered. The same old saga – brokers and bankers combining to rob people of their hard earnings – was repeated. Funds from Seaman’s Provident Fund and PPF were affected. The total scam size was reported to be around Rs 300 crores, and more than Rs 200 crores were spent on publicity costs alone.
Securities Scam – Ketan Parekh – That our system never learns its lessons was proved by this scam. Ketan Parkekh, a qualified CA, and a stock broker, identified a number of stocks (popularly called the K-10), and took up huge positions in these. For this purpose, he used a large number of Benami accounts and smaller stock exchanges, such as the Kolkata and Ahmedabad stock exchanges. He also borrowed heavily from banks such as Global Trust Bank and Madhavpura Mercantile Cooperative Bank. Unfortunately, he was stuck in a bear cartel, and was soon pounded to pulp on the stock exchange. The extent of the scam was estimated to be around Rs 1,500 crores.
Abdul Karim Telgi
Fake Stamp Papers – This scam promised to be the mother of all scams in India, with the initial reports quoting a figure of Rs 30,000 crores as the scam size. Later, RBI clarified that this figure was “rather exaggerated”, and the “correct” figure was around Rs 200 crores. Again, this scam exposes how the India system works – Mr Abdul Karim Telgi, the scam kingpin, paid bribes to get access to the security press in Nasik, where stamp papers and currency notes are printed. He later used this knowledge to print fake stamp papers. At the height of the scam, Telgi’s network spanned 14 states, 125 banks and more than 1,000 employees.
DSQ Software – Though this scam was modest in terms of money involved (only Rs 600 crores!), and did not affect the general public to a great extent, yet it is notable for how it came into being. The main player in the scam was Mr Dinesh Dalmia, who was the MD of DSQ Software Ltd. This company issued around 1.3 million shares in 2001, and these shares were allotted to four companies on a preferential basis. NSDL, a stock depository, dematerialized and helped in delivering the shares. Nothing wrong in that, except that the shares were not even listed on any stock exchange! Oops!
IPO Scam – A number of key operators, including corporate stock brokers such as Karvy and Indiabulls, were involved in the IPO scam that spanned the years 2004 – 2005. The modus operandi was simple – the operators would open thousands of fake accounts to purchase shares in IPOs, in the hope of selling later at huge profits. A spate of IPOs issued during this period were heavily oversubscribed due to this scam, sometimes by as much as 40 times!
Satyam – On a cold January morning in 2009, Ramalinga Raju, chairman of Satyam Computer Services, admitted to falsification in the company accounts and various other irregularities, and sent a chill down the collective spine of the Indian financial system. Coming on the back of the global recession, this incident promised to bust the Indian outsourcing industry and the stock market, but for some deft bailout work by the government. The matter is still under investigation and litigation, and the true extent of the scam will be known in the future, perhaps. Mr Raju himself had admitted to irregularities worth around Rs 12,000 crores.
An analysis of the scams reveals a common script – greed, corruption, unscrupulous brokers, colluding bankers, irresponsible authorities and hapless investors, who refuse to learn their lessons. But then, these are the essential ingredients of a worthy financial scam!
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A brief about Top 10 Investment Scams in India
Shame! India sold its dead cheap Shobhan Saxena,
Around 22,000 dead. More than 1,20,000 injured. Rs 1 lakh for
No country sells its people so cheap.
Today – on the day of Bhopal disaster
judgment -- if there is a failed
India – its government, judiciary and corporates – accepted
Today, they were denied justice. Today, they were told that they
What justification does CBI have for not being able to produce
Last year, on a balmy July day, a bunch of victims danced on the
Today’s ridiculous judgment in Bhopal didn’t
say anything on Anderson
*Why did Union Carbide not apply the same safety standards at
*On the night of the disaster, why did the six safety measures
*Why was the safety siren, intended to alert the people living
The victims have always alleged that Bhopal happened because of
A criminal has a reason to hide, but what reason does our
Today, India proved that it doesn’t really care for its
Rs 1 lakh for every body. Rs 25,000 for every blinded eye. This is
BP and Union Carbide:
Two momentous events separate in time and location have seared our consciousness—the British (Beyond) Petroleum Gulf Coast oil spill on April 20, 2010 and the American Union Carbide Bhopal Gas Tragedy in December 3, 1984. Twenty five years separate these two environmental and human disasters but the greed of big multinational corporations in connivance with state and central agencies still remains insatiable. With a keen eye on profit, big companies compromise safety standards, falsify data, overstate their strength, underestimate their drawbacks, bribe officials, lobby for protection and misinform the public. It is rather difficult to fuse ethical economic standards with ravenous profit-making schemes. Though oil and gas stink most multinational corporations love it.
The neo-classical model of economics has reduced our land and
environment to a mere abstraction that can be exploited in terms of supply and
demand without compunction. Big companies continue to wreck havoc on our human
and natural systems devastating our lives in the name of human progress and
development. At such moments we often wonder where is the fashionable concept
called social corporate responsibility that is often taught as a philanthropic
and ethical tool in business management departments to unsuspecting students.
Corporate greed like all other forms of human greed need to be kept under
strict check by international pay czars or up-to-date legislation based on
global standards with teeth for swift punishment. Also the rhetoric of
corporate companies must be separated from what they actually do, how long they
do what they do, and what they hide. A constant monitoring system both on the
part of governments and private groups must be effectively installed in
collaboration with the media to thwart their nefarious activities and ulterior
ARE YOU SINCERELY READY TO CATCH TAX THEIVES ?
QUESTIONS FOR MONEY – PARLIAMENTARY ACTS/LEGISLATIONS FOR ???? -improper functioning of democracy in india
the vohra committee report has proved the criminalisation of
politics in india. There are many number of criminals in the parliament &
state legislatures. Some of those criminals are cabinet ministers as well as
members of vital parliamentary committees. Thereby, they are in a position to
manipulate , enact laws favouring , benefitting the criminals their cronies.
By Ashutosh Sinha
Not many in India might have actually seen the field gun from Bofors AB, either standing sentinel on the borders or in operation. The guns played a key role in the skirmishes at Kargil in 1999. The same anonymity does not hold good for Xerox, which has now entered the dictionary as a verb in its own right for photocopying documents.
Since its name has become synonymous with the allegations of kickbacks, few companies would like to be compared with Bofors. But since the deal was a big commercial success for arms dealers, some companies would, perhaps, be tempted to employ the same tactics as the Bofors middlemen.
The Swedish firm Bofors AB allegedly paid Rs.640 million ($13 million) in bribes to middlemen to get the contracts for the deal signed in 1986. Nearly a decade later, Enron India spent US$ 20 million in "educating" Indian bureaucrats about the role of private companies in power generation, an euphemism for bribes. Two telecom companies, Essar and Swisscom, were alleged to have paid a former minister, Sukh Ram, a hefty amount during early 1996 to help change the original license conditions, which it had signed with the Department of Telecommunications. There was no case against Sukh Ram, simply because this deal was never investigated.
Significantly, none of the allegations made above have yet been proven in a court of law.
Xerox India was treading on familiar path, something which its US headquarters got to know later. According to the parent company's own admission, which emerged during its audit, it paid over $600,000 as bribes to various government employees to win contracts. In essence, the modus operandi was just a 'photocopy' of the way some other companies operate.
Under the Foreign Corrupt Practices Act (FCPA), it is a serious criminal offence for a US company to pay bribes in a foreign country to obtain contracts. Being managed by the BK Modi group, one of Indias oldest family run business empires, at the time when the bribes were paid, it is now like a sword hanging at the neck of Xerox. The BK Modi group has denied having paid any bribes. Xerox Modicorp Limited (as the company is now called) completes 19 years in India this September. It changed its name from Modi Xerox Limited to Xerox Modicorp Limited in 2000.
The Indian government was quick to order an inquiry. A promise that accompanied the order was that the inquiry would be completed in two weeks. Over a month later, the two weeks are not yet over. Now, the million-dollar question - for a company that calls itself 'The Document Company' - is there enough documentary evidence to prosecute the company?
The Department of Company Affairs (DCA), the arm of the government that wields the stick to ensure that companies meet their stated objectives and do not dupe the shareholders, is looking into the details. Xerox was not duping shareholders, much the same way as the military hardware company AB Bofors. Both were, in fact, trying to reward their shareholders by giving the extra edge to their sales team by "taking care" of those taking a final decision on the purchase of their products. DCA is still not sure whether the bribes were actually paid or if the amount was pocketed by Modi or his men.
There is a stark difference between the two cases, though. Bofors is a European company, Xerox an American. Their products are proverbially as different as chalk and cheese - one sold military hardware, the other office automation products. While the Bofors payoffs involved the government official right at the top in the government, the Xerox payoffs appear to have been made to the operations level people in government. Besides, the nature of arms deals is such that the best deal has to be sewn in one shot. Office automation products are regularly purchased by companies and governments. So, if a few people can be identified, their palms can be greased regularly to put the product. The agents who helped Bofors are still trying to block investigations and any information into their money laundering. The amount involved in the Xerox case is far smaller.
Xerox, however, does deserve a pat on the back for having the courage to admit the payoffs in public.
There are some parallels between the two companies. Bofors money found its way to exotic places that you would find difficult to locate on the world map - Luxembourg, Bahamas, Liechtenstein, Channel Islands. The Xerox India payoffs did not have such exotic addresses. Two of the companies to which payments were made had slum areas of Delhi as their addresses while two others were located in the western Indian state of Gujarat.
While the Bofors deal had strong political linkages, there is talk of the involvement of a Samajwadi Party politician, who has interests in the paper business, in the Xerox case. That allegation is yet to be probed, though.
AE Services, Svenska, Lotus, Tulip and Mont Blanc are some of the names of bank accounts that are associated with the alleged Bofors payoffs. The money has gone into a variety of accounts before disappearing various pockets. Officials of the Central Bureau of Investigation (CBI), India's premier investigating agency, suspect that these people include the late Win Chadha, an Italian called Ottavio Quattrochchi and the Hinduja brothers. If the Xerox India deal had been bigger, with international ramifications, it would not have chosen names like Charu Paper Ltd., Chadha Paper Ltd., Pioneer Enterprises and Elite Commercial Services.
At the time when these bribes were paid, the company was controlled by the BK Modi group, which owned majority shares in the joint venture. When Xerox acquired control of the company (it now owns 68 per cent while BK Modi controls 28 per cent in the joint venture) in 2000, it ordered an inspection of the books by the audit firm PriceWaterhouseCoopers, which raised disturbing questions. The audit firm said that it was not sure the organizations existed and, if they did, who owns or controls them. BK Modi Group has interests in telecom, entertainment and manufacturing.
Xerox has over 50 per cent market share in photocopiers in India. 1998 was a landmark year for the photocopier industry. Of the estimated 40,000 machines sold that year, an estimated 27,000 were Xerox machines. However, that was an aberration and nearly 30,000 machines are sold in the market each year at present. Nearly 60 per cent of the sales are made to government organisations.
Incidentally, the bribes are alleged to have been paid in 1998 and 1999. In 1998, the 15-year tie-up between Modis and Xerox ended. Xerox had entered India after a tie up with the BK Modi Group and Modi Xerox Limited was incorporated in 1983.
The Joint Parliamentary Committee (JPC), which had looked into the Bofors deal before CBI started its investigations of bribery charges, had similarly not given a clean chit to the Rajiv Gandhi government. The government survived the day but since then, the Congress party has never won a majority in the Indian Parliament. Bofors has also entered India's political lexicon as a synonym for bribery.
DCA officials are tight-lipped about the direction in which their Xerox investigation is meandering. These are just four names that have tumbled out of the closet. Reports suggest that it is a web of 85 companies through which payments have been made. The challenge before DCA is to verify whether payments were made to individuals in the government or did some officials of Modi Xerox (as the company was then called) pocket the money.
While it is still to be established where the money actually went, DCA officials admit in private that siphoning money out of the company is a routine affair. Just like every official worth his salt in the CBI knows that big arms deals do have an element of an underhand deal.
Since payoffs are now a part of business, this is where the interest of the average person comes in. Hapless investors have seen scores of cases where the companies get sick and promoters healthier by the day.
For all the arms deal that have happened in India, whose defence spending is over US$ 14 billion every year, only one case has been brought to light. None have been prosecuted. Of nearly 7,000 publicly listed companies in India, a little over 2,000 actively trade on the Bombay Stock Exchange. The rest are companies which have turned sick, while some of their promoters get healthier.
Radia lobbied to get Raja telecom ministry
Union Communications Minister A. Raja has been caught on tape
lobbying with a corporate PR agent for a place in the Manmohan Singh cabinet
during the second term of the UPA.
REAL STORY OF Late DHIRUBHAI AMBANI of Reliance Industries
The CAG draft report that nails the connivance between Government agencies and Reliance Industries Ltd. leading to huge losses to the Government exchequer is yet another example of the power of corporates in the UPA Government to subvert rules and regulations in their favour.
The CAG has noted that the former Director-General of Hydrocarbons (DGH) permitted Reliance to inflate its “development costs” on the gas extraction in the D6 block of KG basin from 2.47 billion dollars to a whopping 8.84 billion dollars. This money taken by RIL affected the revenues of the Government. Government should prosecute the former DGH without any delay.
The Government’s connivance with RIL has a direct impact on the aam aadmi because increased claims of development cost get reflected in the price of gas given to consumers and also affect the prices of fertilizer and power. Letters have been written to the Prime Minister to institute an independent enquiry into the complaint of artificial jacking up of the capital expenditure by RIL for D6 KG Basin and its hasty approval by the concerned authority to find out the actual cost before gas price is fixed.
In a repeat of the 2-G scam, the Prime Minister’s silence on the issue, has again exposed the UPA Government’s acquiescence to corporate manipulation.
RELIANCE INDUSTRIES LIMITED - WHERE IS ACCOUNTABILITY?