India Legal 03 July 2017

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GST?
Next week, the country will feel
the effect of the government’s big
bang reform. Financial experts see
many pitfalls ahead
Republic TV: Rating
War Goes Viral
Kasauli: Green
Crackdown
Who’sAfraidof
Gorkhaland Redux: Perilous Turn
ALSO

HERE was once an India in which
people on different sides of issu-
es—no matter how deep or broad
the chasm—could disagree without
being disagreeable or spewing
venom. They could compromise or reach a
consensus because what mattered were
issues like economic, domestic or foreign
policies. Today, debate and discussion has
been sacrificed at the altar of identity war-
fare: if you don’t conform to my idea of
India, you are guilty of treason or waging
war against the state which I have cast in my
own image.
The choice of Ram Nath Kovind as BJP’s
presidential candidate illustrates this trend.
I am sure Kovind is a good, kind, man, well-
heeled, educated and honest who would help
bolster his party’s standing with the Dalit
community. But what about other communi-
ties inextricably interwoven into this rich
coat of many colours we call India? Kovind
has often been quoted as saying that Islam
and Christianity are alien to India. He is
entitled to his opinion. But does a right
to your opinion endow you with the
right to your own facts? Kovind’s
being the prevailing orthodoxy of
the day, any vehement denuncia-
tion of this attitude would invite
cries of “anti-national” and “go home
to Pakistan”.
But in the once-upon-a-time India, we
listened to one another and even came to
terms. Leaders knew the difference between
statesmanship and demagoguery. I harken,
as I often do, to the debates on sensitive
issues by the founding fathers when they
were giving us our constitution. Nothing
contentious was spared, least of all questions
of religion, which brings me to the status of
Christians in India who form a little over 2
percent of the population.
The right to practice and convert was one
of the touchiest issues which boiled over in
April 1947 when Congress leader KM
Munshi sought to introduce a provision
(Clause 17 in the interim report on Funda-
mental Rights) prohibiting the religious con-
version of a minor under age 18.
Indian Christians protested. Member
Frank Anthony congratulated Congress
members of the Assembly for including the
“right to propagate religion” as a fundamen-
tal right, but argued: “If you have this partic-
ular provision, or if you place an absolute
embargo on the conversion of a minor, you
will place an embargo absolutely on the right
of conversion. You will virtually take away
the right to convert. Because, what will hap-
pen? Not a single adult who is a parent,
however deeply he may feel, however deeply
he may be convinced, will ever adopt
Christianity, because, by this clause you will
be cutting off that parent from his children.
By this clause you will say, although the par-
ents may be converted to Christianity, the
children shall not be brought up by these
parents in the faith of the parents. You will
be cutting at the root of family life. I say it is
contrary to the ordinary concepts of natural
law and justice. You may have your preju-
dices against conversion; you may have your
prejudices against propagation. But once
having allowed it, I plead with you not to
cut at the root of family life.”
ONCE UPON A
TIME IN INDIA
Inderjit Badhwar
Letter from the Editor
| INDIA LEGAL | July 3, 2017 3
T

4 July 3, 2017
Founding father and pilot of the Ass-
embly BR Ambedkar concurred. He said: “I
have no objection to a provision being made
that children who have legal and lawful
guardians should not be converted without
the knowledge and notice of the parents.
That, I think, ought to suffice in the case.”
And look at how strongman Sardar
Vallabhai Patel responded: “… we who have
to live in this country and find a solution to
build up a nation, - we need not introduce
any heat into this controversy to find a solu-
tion. There are bound to be differences in
the viewpoints of the different communities,
but, as Dr Ambedkar has said, this question
has been considered in three Committees
and yet we have not been able to find a solu-
tion acceptable to all. Let us make one more
effort and not carry on this discussion, whi-
ch will not satisfy everybody. Let this be
therefore referred to the Advisory Commi-
ttee. We shall give one more chance.”
Christian reaction continued to bubble.
The National Christian Council Review of
June-July 1947 published an open letter by
L Sen on the subject of religious liberty.
“All this talk,” said the writer, “about mass
conversions being achieved by improper
means is absolute balderdash… For several
centuries Hindus have kept the so-called
untouchables from their temples and still do
so in most places. It is a curious mentality
that excludes a homeless man from one’s
own house and will not allow him to enter
someone else’s…. Man has certain inalien-
able rights which not even a majority vote
can take away. One of these rights is that
he is free to choose his religion or society,
without his motive being impugned by
government, whether fascist, communist
or democratic.”
T
he magazine’s August issue, in an
angry tirade, advised the Congress
members to shun the path of Nazi
Germany: “The Congress members of the
Constituent Assembly, who wish to make
everything Hindu from top to bottom should
take a lesson from history. Hitler created a
kind of nationalism which brought about the
ruin of the German nation. His nationalism
created a narrow outlook, and a sense of
racial superiority which produced hatred for
other nationals, and racial stocks. He gave to
the German people those things and ideas
which made the Germans feel distinctly dif-
ferent from others, i.e. the Swastika and a
special salutation.”
Intheonce-upon-a-timeIndia,welistenedtooneanother
andevencametoterms.Justice,fairplay,reasonand
compassionruledpublicdiscourse.

The famous British Methodist mission-
ary, Rev. Stanley Jones, writing in the same
issue, noted that there was widespread fear
among Christians that in independent India,
they would be persecuted, eliminated, or
forced to return to the castes from which
they had been converted.
He then provides this fascinating account
of his own subsequent meeting with senior
Congressmen even as the Constituent Ass-
embly debate raged:
“So I went to Sardar Patel, the strong
man of the Congress, and asked him what
part the missionaries can play, if any, in this
new India.... He very thoughtfully replied,
‘Let them go on as they have been going
on—let them serve the suffering with their
hospitals and dispensaries, educate the poor
and give selfless service to the people. They
can even carry on their propaganda in a
peaceful manner. But let them not use mass
conversions for political ends.’ ‘If they do this
then there is a place for them in the new
India?’ I asked. ‘Certainly,’ he replied, ‘we
want them to throw themselves in with Ind-
ia, identify themselves with the people and
make India their home.’ This was quite clear
and straightforward and from the man who
has to do with the question of who shall
or shall not come into India, for he is the
Home Member.
“I then saw C Rajgopalachari and asked
him the same question. His reply was that
‘While I agree that you have the right of con-
version, I would suggest that in this crisis
when religion is dividing us it would be a
better part of your strategy to dim conver-
sions and serve the people in various ways
until the situation returns to a more normal
state. If you are not willing to do that then I
would suggest that instead of ‘Profess, prac-
tise and propagate’ as suggested in the
Committee, it should be ‘Belief, worship and
preach’. Then I further asked, ‘Will the mis-
sionaries be tolerated or welcomed as part-
ners in this new India?’ His reply was: ‘If
they take some of the attitudes I suggest,
then they will not only be welcomed, they
will be welcomed with gratitude, for what
they have done and will do.’
“The third man I saw was Maulana
Abdul Kalam Azad, the gracious head of
Education in the Central Government. I
asked him whether missionaries could be
tolerated or welcomed as partners in the
making of this new India. His reply was:
‘Do not use the word tolerate. You will
be welcomed. There is no point at issue
Today,debateanddiscussionhasbeensacrificedatthealtarof
identitywarfare:ifyoudon’tconformtomyideaofIndia,youare
guiltyoftreasonorwagingwaragainstthestate.

6 July 3, 2017
with the missionaries, except at one point: at
the place of mass conversions where there is
no real change of heart. We believe in the
right of outer change where there is inner
change, but when masses are brought over
without any perceptible spiritual change
then it arouses suspicions as to motives....
You will be welcomed gratefully for what you
have done not only for India but for other
parts of the world such as the Near East.’
“The fourth man to whom I went was the
man whom Gandhiji calls ‘the uncrowned
king of India’, Jawaharlal Nehru, and when I
asked him whether missionaries will be tol-
erated or welcomed as partners in the mak-
ing of the new India his reply was: ‘I am not
sure as to what is involved in being looked
on as partners. But we will welcome anyone
who throws himself into India and makes
India his home.’
“The fact of the matter is that the great-
est hour of Christian opportunity has come
in India. I have never had such a hearing in
forty years as I have had in these last six
months in India. The tensions have been let
down. The combativeness against the
Christian faith has been eased into an atti-
tude of wistful yearning....
“The Christian Church must now search
its own heart and set its own house in order.
It must cease from little irrelevancies and
give itself to big things. The big thing in Ind-
ia is to present Christ in such a way as to
become inescapable in the India to be. And
the Church itself must be the message—it
must show itself the embodiment of the
new order.”
D
ebate and discussion led ultimately
to the Constituent Assembly adopt-
ing Article 19 with two minor ame-
ndments accepted by Ambedkar. The right
of Christians to propagate religion and to
convert included minor children. Article 19
later became Article 25 of the Constitution.
Christian scholars, padres, were ecstatic.
Felix Alfred Plattner writes in The Catholic
Church in India: “Their spontaneous reac-
tion was, ‘Pandit Nehru proves himself a
gentleman.’ Pandit Laxmi Kant Maitra,
Mr Krishnaswamy Bharati and Mr TT
Krishnamachari were congratulated for
‘their noble and courageous defence of
the rights of a minority.’”
On August 15, 1948, a year after India
became independent, the new nation estab-
lished diplomatic relations with the Vatican.
Justice, fair play, reason and compassion
ruled public discourse in the India that was.
That was India once upon a time.
Twitter: @indialegalmedia
Website: www.indialegallive.com
Contact: editor@indialegallive.com
Thefoundingfathersof
IndialikeMaulanaAzad
andSardarPatelknew
thedifferencebetween
statesmanshipand
demagoguery.They
understoodthereare
boundtobedifferences
inviewpointsbutwe
neednotintroduceany
heatintocontroversies.

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Bachi Karkaria recalls
the case that shook India
Sweetheart Affair
NAVI MUMBAI AIRPORT
GVK-MIAL is flying high after landing a `16,000-crore contract from which
other bidders mysteriously backed off, giving the infrastructure company a
windfall deal at the expense of taxpayers
ArtistImpression
WhatsApp: Killing
the messenger?
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Ransomware: The New Digital
Threat and How to Stay Safe
SELF-FULFILLING PROPHET
Three Years of Narendra Modi
Like a quick-change artist, he has displayed an uncanny knack of
reinventing himself to adapt to political exigencies and conjuring up
worlds that people want to believe in, says Shiv Vishwanathan
Triple Talaq:
The Supreme Test
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Arvind Kejriwal:
Perils of Power
The Bots
ComethMajor law firms are introducing Artificial
Intelligence systems which could rewrite
the role of lawyers. Will this prove a
game-changer for the profession?
Antarctica: India’s
Double Game
CONSTITUTION
PIL’S
IPC
WESTLAW
MANUPATRA
CRPC
INDIAN
KANOON
BAIL
CONTEMPT
DEFAMATION
CASE
HISTORY
PERJURY
RECUSALS
VISHAKA
NIRBHAYA
SHAH BANO
CASE
SECTION 66A
KESAVANANDA
BHARATI
SECTION 377
M C MEHTA VS
UNION OF INDIA
KK
RJJ
ONN
MM
UU
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Patiala House Shift:
Courting Controversy
The Centre’s new restrictions on cattle slaughter is an incendiary
mix of politics, religion, cultural sensibilities and federalism.
Can it be challenged?
Tamil Nadu:
Enter the Lotus
CATTLEWARS
TTV Dinakaran
s aa
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AA
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IT Sector:
Future Shock?
PEDKI DEVI,
labelled a “witch” and
publicly humiliated in
1999, is a subject matter
in school books but still
fighting for justice 18
years later, as the culprits
roam free and continue
to threaten her. The
motive? Greed to grab
her 12 acres of land
Standing Counsels:
Relative Values
Witches BrewBranding women as dayans across tribal belts in India is on the rise as
greed for property, enmity and collusion by local officials overturns legal
and ethical norms, aided by illiteracy and superstition
VII
“ww
umm
suu
boo
or
er,
e aa
enn
Gree
ress
rroo
s
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HarvestofShameBumper crops, a price crash and debt by demonetisation,
farmers face the perils of plenty. The result: suicides, violence,
growing anger and a political minefield
Chief Justice Khehar: Pruning Pendency

Taxing Times Ahead
Will the new GST regime be a big bang reform similar to the Congress’ liberalization in
1991? Or will it take the shine off Modi’s biggest economic initiative?
14
LEAD
ContentsVOLUME. X ISSUE. 33
JULY3,2017
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8 July 3, 2017
The Reluctant Prince
Half a Minister
Can Arun Jaitley, who heads finance and defence, do justice to the latter portfolio?
Having a part-time minister does not bode well for the security of the country
In October, Rahul Gandhi is likely to take over the presidentship of the Grand Old Party.
Will he be a worthy opponent to the BJP in the 2019 general polls?
18
22
POLITICS
COLUMN

REGULARS
Followuson
Facebook.com/indialegalmedia
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Website:www.indialegallive.com
Contact:editor@indialegallive.com
Ringside .........................10
Delhi Durbar ...................11
Courts.............................12
National Briefs .........21, 33
International Briefs..........45
Media Watch ..................49
Satire ..............................50
Cover Illustration and Design:
ANTHONY LAWRENCE
Shocking Volte-Face
The change in statement by a woman who bobbitised a swami in
Kerala who allegedly raped her has baffled the judiciary
28
Crackdown on Big Biz
The government will use the 2016 Insolvency and Bankruptcy Code
to tackle the bad debt of banks by naming and shaming debtors
30
ECONOMY
Pet Peeves
Many in the pets business find the new
Prevention of Cruelty to Animals Rules
excessive, absurd and discouraging
46
ACTS&BILLS
Green Order
NGT’s recent order “ceasing the functioning” of chairmen of 10 state pollution
boards, appointed sans requisite qualifications, comes as a wake-up call
37
Two Steps Backward
RTI activist Nikhil Dey and others were convicted in a 19-year-old
case for allegedly seeking information in a corruption matter
34
COURTS
Nation Wants to Know
Arnab Goswami’s Republic TV has shown that it is easy to manipulate viewership
ratings and appear to be ahead in the competitive field of English news television
42
Rescuing Kasauli
The apex court’s dismissal of Chelsea Resorts’ plea against an NGT demolition
order has reassured those campaigning against illegal constructions there
40
ENVIRONMENT
BROADCASTING
Mutiny in the Hills
Behind the latest Gorkhaland stir, is there the need to divert eye-
balls from the misappropriation of central funds by its leaders?
24
STATES

10 July 3, 2017
“
RINGSIDE
The present government is leading the country
to a new Partition. They have opened up
wounds that were long healed or were
gradually getting healed.... This government
is trying to impose its monolithic narrative
on us. You cannot even argue with them as
they have no understanding of our culture.
—Author Krishna Sobti, in an interview to
The Indian Express, calling it her “last interview”
Ram Nath Kovind appears
really worthwhile as presiden-
tial candidate. Despite efforts,
media, Opposition are not
able to dig any dirt on him.
—Activist Madhu Kishwar,
on Twitter
Gaurakshaks are
performing a great
service. We must give
them a certification. A
national cadre called
Gaurakshaks of
Hindustan must
be made.
—BJP leader
Subramanian Swamy,
at a national conference
for cow protection
in Mumbai
For years now, Pakistan
is playing home match-
es in Dubai. We don't
get the home advantage
like other teams.
Through this victory, I
would like to appeal to
the other teams that
please come and play
in Pakistan.
—Pakistan captain
Sarfraz Ahmed, speaking
to mediapersons after
his team’s Champions
trophy win
To claim that all of Indian-
ness has its roots in the Vedas
is as absurd as saying all of
Western-ness has its roots in
Greece, or Jerusalem.
—Author Devdutt Pattanaik,
on Twitter
So you want softies. You
want somebody to just tell
you, ‘ok boys, don’t practice
today because you guys are
not feeling well, ok take a
holiday, go shopping’.
—Sunil Gavaskar, on
Anil Kumble’s exit as Team
India’s coach, speaking
to NDTV
We’re all humans. We’re all
going to make mistakes and
make poor choices in our
lives, but there are conse-
quences. I’m not sure why
we’ve decided people can say
whatever they want, do
whatever they want, and
there are no consequences
for it.
—US acdemic Nancy Beane,
on Harvard cancelling admis-
sions of 10 students for offen-
sive social media posts,
in The Indian Express
We will go to Delhi and
take up this matter with
the central government
and ensure its success
(clearance). Or else,
Telangana government
will not keep quiet.
This (12 percent reser-
vation for Muslims) is
our right.
—Telangana chief minis-
ter K Chandrashekhar
Rao, in The Wire

An inside track on
happenings in Lutyen’s Delhi
Delhi
Durbar
TAILPIECE
Union minister of state for
agriculture Radha Mohan
Singh should not blame the
press for not highlighting his
ministry’s achievements at
the height of the farmer
protests in Madhya Pradesh
and Maharashtra. But the
mantri, it is learnt, is mighty
upset that he did not get
positive coverage despite
giving exclusive interviews to
several journalists. He feels
that even some of his trusted
friends in the fourth estate
failed him. According to a
trusted aide, the minister was
told by a journalist friend that
his editor was not interested
in carrying a story on his min-
istry’s achievements when
farmers were committing sui-
cide. Last heard, Singh was
still trying to get some posi-
tive coverage which is like
expecting a bumper harvest
from barren soil.
Indian ambassadors, high
commissioners and chef de
missions must be the fittest
diplomats on the planet. Since
June last year, they had been
under instructions to organise
events on International Yoga
Day at prominent landmarks,
and lead the way in the yoga
sessions and post the results
on social media, so India and
Narendra Modi, as proposer of
Yoga Day, get prominence. The
result is that all Indian diplo-
mats posted abroad had start-
ed practicing asanas in antici-
pation of June 21, International
Yoga Day, when they put their
best feet forward—and back-
ward. In London, Trafalgar
Square was the venue, in Paris
it was the grounds of the Eiffel
Tower, while a fit-looking
ambassador Navtej Sarna led
the way at the National Mall
in Washington.
DIPLOMATIC POSITION
Arun Shourie’s speech at
the Press Club meet to
protest the CBI raids on
NDTV’s promoters Radhika
and Prannoy Roy has been
toasted as well as severely
criticised. But what has cre-
ated a buzz within the chat-
tering classes is Shourie’s
caustic barb against Union
minister Venkaiah Naidu. In
what many see as a below
the belt hit, Shourie had this
to say of his “friend”
Venkaiah: “Venkaiah Naidu
is my friend. In our own
paper, The Indian Express,
he gets three quarters of a
page. But I tell you, give
Venkaiah Naidu a third stan-
dard child’s notebook and
ask him to fill one page
coherently on any random
topic—he can’t. Why then
keep printing his articles
when you know very well
that he cannot write?” The
Venkaiah camp in the BJP is
not amused but have decid-
ed to ignore the remark.
Incidentally, the “offensive”
bit has made it to the IB
report on the protest meet.
Is there a conflict of interest
In the way in which Tourism
Minister Mahesh Sharma is
promoting medical tourism?
After all, he owns a chain of
multi-specialty hospitals.
Sharma, wearing his minis-
terial hat, recently made a
presentation to the PM on
the need to promote med-
ical tourism. Following the
meeting, the Ministry of
Tourism is in talks with the
Ministry of External Affairs in
a program to use overseas
missions to promote well-
ness tourism. Sharma also
announced a new wellness
policy on Yoga Day. His
push for medical tourism is
somewhat diluted by the
fact that it could benefit his
own medical facilities, now
run by his daughter.
MEDICAL PRESCRIPTION
BAD PRESS CAUSTIC BARB
Everyone is busy digging
up background informa-
tion on little-known Pre-
sident designate Ramnath
Kovind. Here’s a little
known gem—he was one
of two defence witnesses
in the Tehelka sting
bribery case against dis-
graced former BJP presi-
dent Bangaru Laxman.
Kovind had deposed in
the CBI court and testified
on record that he had
known Laxman for two
decades and that he was
“a simple, honest per-
son”. Laxman was found
guilty under the Preven-
tion of Corruption Act.

In a case of arbitration, the Supreme
Court dismissed the plea of Delhi Metro
Rail Corporation Ltd (DMRC) for a stay on
a payment of `60 crore to Delhi Airport
Metro Express Private Ltd (DAMEPL).
DMRC was asked by the Delhi High
Court to pay the amount in relation to the
termination of a joint project between
DMRC and DAMEPL for the Airport
metro line in Delhi. DAMEPL is part
of Anil Ambani’s Reliance Infrastruc-
ture Ltd.
Earlier, DAMEPL had won an
arbitration award against DMRC for
the project, the total amount being
`4,670 crore. DAMEPL had later
approached the high court, asking
for a payment of `3,502 crore
from DMRC.
The amount is 75 percent of the total
award and DAMEPL referred to the latest
Niti Aayog guidelines on arbitration awards
which say that the amount must be paid
even if the arbitration award is being chal-
lenged in courts.
A single bench of the High Court on
May 30 asked DMRC to pay `60 crore to
DAMEPL for the loan the latter had taken
for the project till the issue of paying up 75
percent of the award was resolved in cou-
rts. The division bench of the High Court
stood by the verdict of the single bench.
Former Calcutta High Court judge CS
Karnan who was lodged in Kolkata’s
Presidency jail on June 21 after being
arrested from Coimbatore on June 20—
reported sick and was taken to SSKM
hospital. Karnan, reportedly, complained of
chest pain. The judge was evading arrest
ever since the Supreme Court had sen-
tenced him to six-month imprisonment on
May 9 for contempt of court.
Earlier, the staff of the jail was in for a
surprise when Karnan, known for throwing
tantrums, broke down. To calm him down,
he was taken to the cells once inhabited
by Independence leaders like Netaji Su-
bhas Chandra Bose and Sri Aurobindo.
The jail officials even took out time to
narrate to him stories of their stays at the
same home. One of the jail officials said:
“He was nothing like the man whom we
saw in the news. We were surprised see-
ing him breaking down. He was unable to
come to terms with the fact that he was in
jail. So we were trying to console him.”
Karnan had retired on June 12 while
being on the run.
Make Maths
optional in
schools
Courts
12 July 3, 2017
The Bombay High Court
recently questioned the
need for education boards to
continue with Mathematics as
a compulsory subject at the
secondary level in schools.
It observed that many stu-
dents in Maharashtra were
discontinuing school after the
Xth standard as they were
unable to pass in Mathema-
tics. The same applied to lan-
guages as well, the court
pointed out.
The Court felt that the ear-
lier system in the state where-
in students were eligible to
apply for degree courses even
if they hadn’t studied Maths in
class X was an ideal one and
wondered why the state had
done away with it. It felt that
Maths was not at all important
for students who wanted to
opt for the humanities stream
or pursue vocational education
after Xth standard. All educa-
tion boards should mull seri-
ously on the issue in consulta-
tion with experts and find out
whether its suggestions could
be carried out, it noted.
The Court was hearing a
petition from psychiatrist
Harish Shetty. The matter will
again be taken up on July 26.
Karnan
arrested,
taken to
hospital
Delhi Metro asked
to pay `60 crore to
DAMEPL

In a stern order, the Delhi High Court has
directed the municipal corporations of Delhi
to sack officers responsible for not clearing
garbage and even directed it to file an action-
taken-report in an affidavit before June 27, the
next date of hearing.
The Court was livid at the “callous disre-
gard of the citizens’ rights” after going
through the videos from a news channel that
showed piled-up garbage in several areas of
Delhi. The municipalities had informed the
Court in an affidavit that garbage was being
cleared regularly.
Upon being caught on the wrong foot, the
counsel for the municipalities put up a brave
argument that there were other reasons for
such a scenario, but the Court did not agree.
The wrath of the Court was borne by the
municipal commissioners of South Delhi and
North Delhi Corporations. The Court also took
serious objection to the absence of the com-
missioner of East Delhi Corporation. It asked
all three to be present in court on June 27.
All three corporations were also asked to
submit their plan of action on how they would
prevent and control vector-borne diseases,
especially since the monsoon season is
around the corner.
Sackofficersfor
derelictionofduty
The Uttarakhand govern-
ment was asked by the
state high court not to buy
luxury cars, furniture and
ACs till further orders
because it had failed to
provide minimum basic
facilities—like benches, desks,
blackboards (including chalk and
duster), computers, a well-stocked
library, a science laboratory with all
equipment, etc—for government
schools in the state. The High Court
had asked the state government in
its November 2016 order to do the
needful within three months.
So angry was the Court over the
lackadaisical and insensitive attitude
of the bureaucrats towards educa-
tion of school children that it ordered
that if its verdict was not implement-
ed, the salaries of all gazetted offi-
cers should be withheld by the state
government. The Court also asked
the state finance secretary to come
up with an explanation as to why
funds earmarked for government
schools were not sanctioned in time.
The state education secretary
informed the Court that money was
sought from the finance department
but there was no response.
After being taken to task by the
Delhi High Court for its decision
to do away with the re-evaluation
system from 2017, the CBSE
assured the Court that it will exam-
ine specific cases of wrong evalua-
tion of students under its verification
scheme, if brought to notice.
Students who had appeared for
Class XII exams this year had
approached the High
Court against the Board’s
decision to do away with
the re-evaluation system.
The vacation bench of
the High Court which was
hearing the students’ peti-
tion asked them to get in
touch with CBSE and the
petitions were disposed.
However, CBSE’s
counsel made it clear that the deci-
sion to do away with the re-evalua-
tion policy from 2017 stands.
Earlier, referring to several
answer sheets in which there were
blatant errors in evaluation, the High
Court wanted to know on what
basis the Board had come to the
conclusion that re-evaluation was
not needed.
The High Court also wanted to
know the discussions that took place
at the meeting where this decision
was arrived at and sought the details
of it.
— Compiled by Prabir Biswas
Delhi HC compels
CBSE to take up
students’ cases
No ACs, cars
for govt, says
U’khand HC

OR a party that has had a
love-hate relationship with
economic reforms, the Goods
and Services Tax (GST) initia-
tive is indeed a radical move
of the BJP. And the Modi gov-
ernment is staking its political
reputation in rolling it out successfully.
That it opposed the GST when it was in
opposition from 2004 to 2014 is now
seen as an embarrassing detail and
nothing more. Will GST steal the thun-
der from the Congress which ushered in
reforms in 1991? That waits to be seen.
But despite Prime Minister Narendra
Modi tilting towards welfare measures
and economic populism resembling that
of the Congress and GST being hailed as
a revolutionary measure, the govern-
ment knows that implementing it will
be a tough challenge. When Finance
Isthenewtaxregimeintroducedbythegovernmenta
bigbangreformsimilartotheoneintroducedbythe
Congressin1991?OrwillittaketheshineoffModi’s
biggesteconomicinitiativesincehetookoffice?
By Parsa Venkateshwar Rao Jr
14 July 3, 2017
Taxing
Times
Ahead
F
Lead/ GST
UNI

GSTrates
A
t the GST Council meeting on
May 1 at Srinagar, a list of
goods under the different
rates—5, 12, 18 and 28 percent—
was finalised but not completed. For
example, textile, footwear, bidis and
precious metals are yet to be fitted
into categories. Even on those items
slotted under one rate, further vetting
and change will take place. But the
present list is formidable yet simple
compared to the older system which
had hundreds of separate cate-
gories. The present list is confined to
96 chapters in the GST rate manual,
with four categories for each item,
starting from nil tax and peaking to
28 percent.
Chapter 1 deals with Live Ani-
mals. The nil tax category is for all
goods other than live horses, asses,
mules, hinnies, bovine animals, swi-
ne, sheep and goats, poultry, mam-
mals, birds and insects. Live horses
fall in the 12 percent GST rate.
Chapter 2 deals with meat and
edible meat offal. In the nil rate cate-
gory fall fresh and chilled meat of
bovine animals, swine, sheep and
goats, horses, asses, mules or hin-
nies, edible offal of bovine animals
swine, sheep, goats, horses, asses,
mules or hinnies, poultry. But all
meat “in frozen state and put in unit
containers,” meat and edible meat
offal “salted, in brine, dried, or
smoked” attract 12 percent GST.
Chapter 3 deals with fish. Here,
all fish “processed, cured and in
frozen state” attracts 5 per cent GST.
Chapter 4 is about dairy produce
and eggs. Fresh eggs, curd, lassi,
chenna and paneer fall in the nil cat-
egory, ghee, butter oil, cheese have
been slotted in the 12 percent rate
slab and condensed milk attracts 18
percent GST rate.
Chapter 97 dealing with works of
art, collectors’ piece and antiques
has the single rate of 12 percent.
However, there will be changes,
though it is difficult to say what kind.
would be untenable and had to be
changed. He said there would be prob-
lems in implementation and it would
take six months to a year for things to
settle down.
Chartered accountant Raman
Khatua said: “Tax laws have been simp-
lified but the ease of doing business has
been made more difficult than before
because of compliance procedures.” This
is the reality of GST despite the website
of the Central Board of Excise and Cus-
toms, the GST administrator, claiming
that GST will “maximise economic gain
& minimise compliance pain”.
Small businesses in the manufactur-
ing sector will bear most of the brunt of
GST implementation. Under existing
excise laws, only manufacturing busi-
ness with a turnover of more than `1.50
crore have to pay excise duty.
Minister Arun Jaitley interacted with
the media on June 1, he said with a
deadpan expression: “I see no reason
for the adverse impact of GST.” But he
and the bureaucrats in his ministry
know there will be glitches aplenty as it
gets implemented.
Though Arvind Virmani, former
Chief Economic Advisor between 2007
and 2009 termed GST as “the single
most important economic, constitution-
al change since Independence,” Arvind
Singhal, chairman, Technopak Advisors,
felt that the multiple tax zone system
DIFFERING VIEWS
Many people think GST is good in
theory but will be chaotic in practice;
(facing page) It is still not clear how
the new tax structure will affect the
price of goods being sold

Increase in Operating Costs: Most small
businesses do not employ professionals
and prefer to pay taxes and file IT returns
on their own. As GST is a new tax sys-
tem, they will require professional assis-
tance and have to bear additional cost.
Change in Business Software: Most
businesses use accounting software or
ERPs for filing tax returns which have
excise, VAT, and service tax already incor-
porated in them. The change to GST will
require them to change their ERPs, too,
leading to increased costs of purchasing
new software and training employees.
More Confusion: GST implementation
date is July 1, 2017. So, for fiscal year
2017-18 business will follow the old tax
structure for the first three months, and
GST for the rest of the year. Businesses
will end up running both tax systems,
resulting in more confusion and compli-
ance issues.
Increased Tax Burden: GST has only
four proposed tax rates. Thus, for many
sectors, the tax burden will increase,
which in turn will increase the price of the
final goods.
Petroleum Products: These have been
kept outside the scope of GST as of now.
States will levy their own taxes. Tax credit
for inputs will therefore not be available to
related industries like the plastic industry
and factory machinery, pushing up the
final price of all manufactured goods.
Registration in Multiple States: GST
requires businesses to register in all the
states they are operating in. This will
However, under GST, the turnover limit
has been reduced to `20 lakh, thus
increasing the tax burden for many
manufacturing SMEs.
Khatua gave two examples of the
hurdles ahead. For example, if a person
buys tea for `10 from a street-vendor, he
is expected to state the name of the ven-
dor and keep a receipt. In the second
case, if a customer is purchasing from
an unregistered person, he will have to
pay GST for the transaction. He said
that every transaction would be taxed
and talk of exemptions was a mere eye-
wash and even false.
He also foresaw a clash between
excise authorities and businessmen in
the interpretation of GST rules and vari-
ous tax slabs. For example, would a par-
ticular item fall in the slab of 12 per-
cent rate or 18 percent? He feared that
excise authorities would want to place
more items in the 18 percent slab. So,
expect more tax litigation under the
GST regime. Though a list of items
under each slab would help in averting
confusion, he said the old quarrel
between the taxman and the business-
man would continue.
Hiccups would crop up in the imme-
diate aftermath of GST rolling out on
July 1. One would be businesses holding
old stock and selling it under the new
tax regime. Also, tax collections might
fall in the second quarter of the 2017
financial year. It also waits to be seen
whether tax rationalisation benefits
promised by GST would be passed on to
the consumer. However, the anti-profi-
teering clause in GST would serve as a
deterrent, said Khatua.
A spokesperson of a national trade
and industry body speaking on condi-
tion of anonymity said the transition
period would be painful. Though indus-
try organisations had been clamouring
for GST for decades, he said it would be
difficult for them to now complain
about the pain in implementation. So
would GST be a bitter pill that industry
and businesses would have to swallow?
He admits that business people, espe-
cially small entrepreneurs, were not in
the habit of maintaining records and fil-
ing monthly returns and they would
have to get used to doing so soon.
C
ongress general secretary and
party spokesperson Manish
Tiwari cryptically said that GST’s
impact would have to be seen in the
weeks and months ahead, and no
amount of celebrity endorsements—a
dig at Amitabh Bachchan’s audio-visual
clip run by the government media—
would help.
Tiwari recalled former Prime
Minister Manmohan Singh’s January
2011 statement saying that the BJP
wanted criminal cases against some of
its leaders withdrawn in return for sup-
port for GST, indirectly saying that this
move was the Congress’ idea and that
the BJP was walking away with the lau-
rels. While earlier the BJP was against
GST, it was now the turn of the
Congress to adopt a lukewarm stance
towards its own “baby”.
Meanwhile, in an open letter, Bharat
Goenka, MD of Tally Solutions Pvt Ltd,
pointed out that one major lacuna of
16 July 3, 2017
Lead/ GST
PitfallsofGST
0
2
4
6
8
10
12
14
16
18
20
22
24
26
28
Australia Canada* Japan Mexico New
Zealand
Turkey Poland UK IndiaGermany
* Provinces in Canada charge additional rates Source: Bloomberg
GlobalGSTRatesRate
VATRates

GST would be the transference of
responsibility and liability of tax remit-
tance to the customers. If a particular
supplier failed to comply with the law by
furnishing correct returns, then its cus-
tomers cannot avail the input credit,
and if given, it would be reversed. “The
problem is not the ‘management of a
manifest risk’—the problem is the side-
effects of cash flow, improper account-
ing, and reduced ability for people to
trade with new suppliers and new cus-
tomers—since there is uncertainty about
the business outcome,” he said
“With the framing of this law, the
Government hopes that the market will
self-weed out the bad eggs—the process
of which is not wrong in theory. What is
wrong is not in understanding the cas-
cading consequences of doing this in
practice—and the mayhem it will create.
While the effort for driving compliance
will reduce, the consequential effect of
businesses shutting down, and therefore
collections going down, have not been
treated seriously enough,” he added.
G
ST has been implemented after
traversing through a long and
winding road and paved with
political rivalries and electoral fortunes.
In 1991, when the Congress ushered in
liberalisation, many in the BJP who
prided them-selves as anti-socialists,
hated state interference in economic
affairs. There were some like LK Advani
who opposed economic reforms and
gave tacit support to rabid anti-market
forums like the Swadeshi Jagran Manch
and opposed India joining the World
Trade Organisation. Vajpayee main-
tained a discreet silence on the issue.
When the BJP led a coalition govern-
ment from 1998 to 2004, Vajpayee
pushed for market reforms and set up
the Kelkar Committee to look into tax
reforms. But it could not be taken to the
next level because the BJP lost the elec-
tion in 2004.
In the decade from 2004 to 2014, the
BJP opposition again felt left out when
Prime Minister Manmohan Singh tried
to push for reforms. Being the main
opposition party, the BJP opposed the
few economic reforms that the Singh
government was able to push through.
At the same time, the BJP targeted Con-
gress president Sonia Gandhi and the
civil society-dominated National Advi-
sory Council in pushing through welfare
measures like the Food Security Act.
Finally, the Modi government has
brought GST to fruition.
increase the burden of compliances.
E-commerce: Many SMEs operate
through their own online shopping web-
sites or through third party websites.
Under GST, they will be required to regis-
ter in all states.
No anti-inflationary Measures: Every
country experienced a hike in inflation
when they first introduced GST. This was
countered by keeping tabs on prices and
anti-profiteering measures at the retail
level. But India does not have concrete
anti-inflationary measures in this regard.
CELEBRITY ENDORSEMENT
The government roped in Amitabh Bachchan
to promote GST; (bottom) The Electrical
Merchant Association protesting against the
new tax regime in Ahmedabad
UNI
UNI

Politics/ Rahul as Congress President
AHUL GANDHI was
elected vice-president of
the Congress Party in
Jaipur on January 20,
2013, with much fanfare.
His acceptance speech at
the AICC meeting was rare and emo-
tional. “The Congress Party is now my
life. The people of India are my life,”
Gandhi declared, adding: “And I will
fight for the people of India and for this
party. I will fight with everything.”
Amidst applause, he also highlighted
the problem of over-centralisation of
power, brazen corruption, women’s rig-
hts and alienated youth who are “exclu-
ded from the political class” as they
watch from the sidelines. But nothing
has changed so far.
There has been speculation every few
months that Rahul will be elevated as
party president. After Sonia Gandhi fell
ill in 2016, it has intensified. Now he is
likely to take over after completion of
the party elections in October. Sonia has
been the party chief since 1998, creating
a record in the party history. If and
when Rahul takes over (it is only a mat-
ter of time), he will be the fifth member
of the Gandhi clan who will hold the
reins of the party. For the past 70 years
since Independence, the Gandhis, be
it Jawaharlal Nehru, Indira Gandhi,
Rajiv Gandhi or Sonia, have headed the
party for 59 years. The Gandhi family
treats the party as its fiefdom because it
gets the votes but this magic is disap-
pearing slowly.
So why is there a delay in making
Rahul the party president? Ever since
Modi came to power, many observers
fear that the Congress is on the verge of
extinction and only a strong and inspir-
ing leader can save it. Some want Rah-
ul’s charismatic sister, Priyanka, to take
over the reins. The old guard prefers
continuance of Sonia Gandhi, while
Rahul’s supporters want him to take
over soon. Others want an end to the
Gandhi family’s control of the party.
As a seasoned politician, Sonia is
acutely aware of the reluctance of the
old guard to wholeheartedly accept
The Reluctant
PrinceWiththeGandhiscionlikelytotakeoverthepresidentshipin
October,itwaitstobeseenifhecanenthusepartyworkers
andgivetheBJParunforitsmoneyinthe2019generalpolls
By Kalyani Shankar
R
18 July 3, 2017

Rahul as the party chief. There are abo-
ut 150 leaders holding important posi-
tions and she is trying to strike a smooth
transition without upsetting the apple-
cart. There was certain unease amongst
the veterans over Rahul’s elevation. But
they are now resigned to his taking over
the party and he too appears to have
realised that he cannot jettison them.
While Sonia Gandhi took over the
party in 1998 when it was downhill and
brought Congress to power in 2004 and
2009, Rahul has missed several oppor-
tunities to prove his mettle since he
joined politics in 2004. Unlike Sonia
who managed to overcome the hurdles
with persistence and hard work, Rahul
has not shown the same determination
to learn on the job. For that, he needs to
become a 24/7 politician, connect with
the masses, dig deeper into some big
ideas he touched on in his acceptance
speech in 2013 and talk in real terms
about how to solve India’s challenges.
He has failed so far.
Rahul also keeps disappearing now
and then, leaving the party confounded.
He has again done the disappearing act
for an undisclosed period of time when
many issues are rearing their head, inc-
luding the presidential elections and
farmers’ agitations.
I
f Rahul takes over, can there be mo-
re disadvantages than advantages?
No doubt he is young and has gro-
wn up listening to discussion of politics
at the family dinner table and has sever-
al other advantages over the younger
leaders in the party. Moreover, the Gan-
dhi family is seen as a uniting factor. He
has the advantage of a united party
behind him with no challengers.
However, many Congressmen are not
confident that Rahul’s elevation will
politically, organisationally and electo-
rally benefit the party. It is his fault that
he has not been able to enthuse the
party and voters. The Congress has been
slipping and is now ruling in only six
states while the BJP has captured 17
states. Since 2013, the party has lost key
elections in almost all states except
Bihar and now Punjab. These include
Maharashtra, Haryana, Assam, Gujarat,
Jharkhand, West Bengal, Jammu and
Kashmir, Andhra Pradesh, Telangana,
Odisha, Tamil Nadu, Uttar Pradesh,
Uttarakhand, Manipur and Goa.
Rahul has virtually been in control
since 2013 and his decisions had often
been passed off as Sonia Gandhi’s ord-
ers. It was he who decided on tickets,
appointments and even strategy. It was
Sonia’s goodwill, her experience, her
maturity and her comfort with the rank
and file which helped the party so far.
Even the old guard fell in line. But once
Rahul takes over, all this will change
as he will have to take responsibility
for all his experiments—good or bad.
Sonia is expected to play the role of a
mentor only.
Also, opposition parties have been
rallying around Sonia on major issues
till today. Senior leaders from other par-
ties like M Karunanidhi (DMK), Jyoti
Basu (CPI-M), Sharad Pawar (NCP) and
AB Bardhan (CPI) had accepted her as
the UPA leader in 2004. Rahul does not
have the same advantage as most oppo-
sition leaders are much senior to him
and they also do not have the same con-
fidence in him. Rahul is seen as a failed
politician. He could have become a min-
ister in the Manmohan Singh govern-
ment and even prime minister after
Rahulneedstobecomea24/7
politician,connectwiththe
massesanddigdeeperintosome
bigideashetouchedoninhis
acceptancespeechin2013.
FAMILY LEGACY
(Right) A section of the Congress believes
Priyanka is better poised to lead the party;
(below) Sonia Gandhi astutely led the
Congress since 1998
Photos: UNI

the 2009 victory. Sadly, he has not even
emerged as a good opposition leader
since 2014. He is not even a good parlia-
mentarian. He has poor communication
skills, does not choose the right issue
at the right time and his attempt to
develop the image of an angry young
man has not clicked.
In December 2013, soon after the
Congress lost four key states in assembly
elections, Rahul promised a transforma-
tion of the organisation “in ways beyond
imagination”. Today, four years later,
after the party’s rout in Uttar Pradesh,
he declared that the Congress needs to
make structural and organisational
changes. But nothing has changed. After
the loss of UP this year, he spoke of
bringing about “structural changes”. In
the recent assembly polls in five states,
though the party emerged as the single-
largest party in Manipur and Goa, it
could not form the government largely
due to poor negotiations. Punjab emer-
ged as a consolation prize.
S
o what should Rahul do to suc-
ceed and will he succeed at all?
The first thing is to boost the
morale of the party workers and choose
a balanced team. He should check the
erosion of senior leaders to the BJP and
get rid of the rootless wonders like San-
jay Nirupam, Madhusudan Mistry and
Mohan Prakash and develop good sec-
ond-rung leaders in states.
He also needs to be clear about what
the party stands for, where it is going
and what more needs to be done to
emerge, first as an effective opposition,
and then, capture power in the 2019
polls. Meetings like Chintan Shivar in
Shimla or Pachmarhi might help. As
Modi-bashing and secular/communal
planks have not worked so far, the party
has to change its narrative. It needs to
rewrite its ideological agenda.
Also, as a good general, he should
prepare the party for the upcoming polls
to eight states in the next two years,
including Gujarat, Himachal Pradesh,
Madhya Pradesh, Rajasthan, Chhattis-
garh and Karnataka where the Congress
is in direct fight with the BJP. Of these,
Karnataka is a Congress-ruled state,
while in others anti-incumbency is star-
ing at the BJP chief ministers.
The Congress also has to decide whe-
ther it should go for coalition partners
or go it alone. If it is the former, the
Congress needs to not only keep the pre-
sent allies in good humour in the UPA,
but also look for credible new ones for
the future.
Rahul should also decide about an
effective poll strategy to deal with the
burgeoning BJP. There have been sever-
al worrying factors for the Congress,
including the BJP’s sustained efforts to
woo the poor and Dalits who have tradi-
tionally supported the Congress. It is
also making deep inroads into Congress
bastions in the North-east in the last
four years. It is going to be very difficult
for the Congress to match its organisa-
tional skills, money and muscle power
and good communication strategy.
Rahul’s magic is nowhere near Modi’s
magic and the next two years are crucial
for the Congress.
Rahul has age on his side and if he
can learn from his past mistakes, he can
still emerge as an effective leader. Tho-
ugh he wears a crown of thorns present-
ly, he needs luck to be on his side.
TOUGH
CHALLENGE
(Right) Rahul
Gandhi’s decisions,
like the one to tie up
with Akhilesh Yadav,
have failed to yield
positive results;
(Below) Rahul’s
magic is nowhere
near Narendra
Modi’s in garnering
votes
UnlikeSoniawhomanagedto
overcomethehurdleswith
persistenceandhardwork,Rahul
hasnotshownthesamedetermi-
nationtolearnonthejob.
Politics/ Rahul as Congress President
20 July 3, 2017

Briefs
Nineteen people have
been arrested across
the country, 15 in
Burhanpur, three in
Mussoorie and one in
Patna on the charges of
sedition. They were
booked for having burst
crackers and for raising
anti-India and pro-
Pakistan slogans after
Pakistan’s victory in the
ICC Champions Trophy
final. The accused in
Burhanpur were sent
to jail after they were de-
nied bail. Meanwhile, 23
people were booked in
Kerala on a complaint
filed by a local BJP mem-
ber, although they have
not been charged with se-
dition. In Mussoorie, how-
ever, the local traders ann-
ounced that no Kashmiri
would be given shops on
rent in future and those
running the business
presently will have to leave
the town.
The government has cleared the
appointment of 11 more judges to
Madras, Chhattisgarh and Punjab and
Haryana High Courts and has sent the
names to President Pranab Mukherjee for
his assent. Of the 11, Madras gets six ad-
ditional judges whereas Chhattisgarh gets
three and Punjab and Haryana HC gets
two. The addition pushes the working
strength of the 24 high courts of the coun-
try to 63 percent of their sanctioned stre-
ngth, bringing down the vacancies to less
than 40 percent, for the first time in three
years. Punjab and Haryana HC had the
highest number of vacancies, 39, followed
by 26 in Madras and 11 in Chhattisgarh.
As per a notification issued
by the revenue depart-
ment, providing Aadhaar num-
bers would be mandatory for
opening bank accounts and for
carrying out transactions of
`50,000 or above. The
notification dated
June 1, makes it
compulsory for
existing bank
account holders to
furnish their
Aadhaar numbers by December
failing which their accounts will
become invalid. The notifica-
tion also tightens rules for
small accounts which could ear-
lier be opened without KYC
documents but will now have
to be opened at bank branches
with core banking solutions.
The government had, in
this year’s budget,
already mandat-
ed seeding PAN
with Aadhaar to
avoid multiple
income tax IDs.
Punjab and Karnataka became the
third and fourth states, respective-
ly, to announce loan waivers to farm-
ers. While Punjab announced a waiver
of up to `2 lakh for small and marginal
farmers who own up to 5 acres of land
and `2 lakh relief for all other margin-
al farmers, irrespective of their loan
amount, Karnataka announced one of
up to `50,000 per farmer that will cost
`8,165 crore to the exchequer but will
benefit about 22 lakh crop growers.
In the interim report submitted by
an expert group led by T Haque, the
Punjab government has also decid-
ed to raise the relief for suicide
affected families to `5 lakh.
Govt clears appointment
of 11 judges
—Compiled by Lilly Paul
19bookedforsedition
Aadhaar mandatory for
opening bank accounts
Punjab, Karnataka
waive off crop
loans

HERE have been a number
of times during the last
couple of decades that the
portfolio of the Union
defence minister has been
under the prime minister
himself or by someone already in charge
of a major ministry. That is the present
situation too with the finance minister
holding additional charge of the defence
ministry. This leaves the country with
and Pakistan on the western and North-
western sector getting more aggressive
and raising the threat levels. Almost
every day, we see heated discussions on
the subject of India facing a two-front
war in the electronic and print media.
The internal security threat is no less
worrying. The vast Red Corridor which
is under the control of Naxals or
Maoists stretches 40,000 sqkm from
the south-eastern borders of Nepal to
T
Half a Defence
not just an overworked defence minister
but, in literal terms, half a defence min-
ister. The inability or reluctance to find
a suitable person to hold the extremely
sensitive position of defence minister is
not only intriguing but also harmful for
a country with both external and inter-
nal security challenges.
Those challenges have become more
serious in recent times with the Chinese
on the northern and North-eastern front
Praful BakshiColumn
Canapoliticianwhoholdschargeofthisministryandanotheronedojusticetothiscrucialportfolio?
Rajeev Tyagi
22 July 3, 2017

eastern UP, West Bengal, Orissa,
Chhattisgarh and Jharkhand to the
borders of Andhra and Karnataka.
Though this officially comes under the
home ministry with the use of paramili-
tary and security forces such as the
CRPF, invariably after every major
attack by the Maoists, questions arise
about bringing in the armed forces
which fall within the ambit of the
defence ministry.
LOGISTICAL SUPPORT
Four years ago, there was the incident
when Air Chief Marshal Pradeep Naik
was asked to use the lethal fire power of
the IAF to attack the Naxals in the
Chhattisgarh and Jharkhand jungles.
The air chief flatly refused to do so,
citing unavoidable collateral damage to
the civilian population. He, however,
suggested that the IAF could provide
necessary logistic and casualty evacua-
tion support to the paramilitary forces
and general aid to civilians with Mi17s
and Mi8 helicopters. This issue should,
in fact, have been sorted out by the
defence minister—if he was knowledge-
able about the application and deploy-
ment of weapon systems and did not
have another ministerial charge weigh-
ing him down.
There have been many occasions
when India had to cope with the result
of having no full-time defence minister
or having a defence minister who was
only interested in his party or had ideo-
logical priorities. This scenario was very
much evident in 1962 when Krishna
Menon was the defence minister, and
the army, which was under overwhelm-
ing pressure from the Chinese, was
denied air and fire support by the IAF.
In fact, nearly six fighter squadrons of
the IAF were inexplicably removed from
the tactical zone of the North-east to
non-operational areas of North India
and Punjab. A comprehensive defence
and security doctrine was totally miss-
ing at that time. The result of this wrong
advice by the defence minister to the
prime minister is now a part of history
when the Indian armed forces were sub-
jected to a humiliating defeat. Few peo-
ple know that Indian ordnance factories
at that time were making coffee percola-
tors instead of ammunition for the
Indian artillery!
The main question that now arises is
why is there such a reluctance to have a
full-time defence minister who knows
his job? The reason lies in the absence
of proper defence indigenisation progra-
mmes. It is a well-known fact that Indi-
an defence indigenisation is practically
nil or extremely ineffective. We don’t
make any main fighting weapon system
for air, ground or sea operations. We can
start from a humble rifle acceptable to
the infantry to the badly needed main
battle tanks or their engines or weapons.
Then, there are fighter jets, transport
planes, helicopters, their engines, appli-
cable weapon systems and warships.
DEFENCE SCANDALS
This total lack of manufacturing and
technological capability leads to
invitations to foreign suppliers from all
over the world or their agents. India
ends up spending billions of dollars in
foreign exchange, which inevitably leads
to kickback scandals.
Examples of this include the 1948
Jeep Scandal, the Centurion Tank deal,
HDW and Scorpene submarine deals,
the Bofors scandal and the recent
Augusta helicopter deal. This situation
would not have arisen if there was a full-
time defence minister who was knowl-
edgeable and well-informed about
equipment and related matters.
In some ways, having a part-time
defence minister who is a politician and
not a military expert, allows decisions to
be taken which benefit certain people or
parties. Conversely, the best way to
avoid a scandal and keep all major deals
corruption-free is to have a knowledge-
able person in finance and make him
handle defence as well. This sector spe-
nds the largest share of GDP and calls
for expert financial judgment and close
monitoring. That is the present position
with the same minister handling both
portfolios. This may work out in a limit-
ed way, but is not a permanent solution.
There is another very sensitive ques-
tion doing the rounds and that is why
not have a professional as a defence
minister such as General VK Singh, an
ex-army chief who is a minister of state.
There may be political reasons for not
doing so but it is time that India has an
effective and efficient defence minister,
not a part-time one.
MinisterNATIONAL
SECURITY
(Facing page) Arun
Jaitley, the current
finance, defence
and corporate
affairs minister.
(Right) Army
maintains vigil in
Srinagar
UNI

States/ West Bengal/ Gorkhaland Movement
T would be an understatement to
say that the hills of West Bengal are
on the boil. In complete defiance of
the Calcutta High Court’s ruling of
June 16 that the indefinite “bandh”
in Darjeeling and adjoining hill
areas was illegal, the Gorkha Janmukti
Morcha (GJM) and its president Bimal
Gurung have continued on the warpath
to complete chaos.
The GJM’s determination to prolong
its agitation was evident when it provi-
ded a 12-hour window on June 23 dur-
ing which all residential school students
in Darjeeling were asked to leave town
for home. Since agitations began in Dar-
jeeling with the demand for statehood
in 1986, this had rarely happened (ex-
cept during a 40-day strike called in the
1980s). Darjeeling has some of the best
boarding schools in the country and
ITowards
Complete
ChaosThereismoretothelatestagitationforstatehoodthan
cultureandlanguage.Istherealsotheneedtodivert
attentionfromthemisappropriationofcentralfundsby
thosespearheadingtheprotests?
By Sujit Bhar
24 July 3, 2017

they have mostly been left alone. These
institutions are as much a pride of the
area as its world-famous tea and its
popular hill station status.
These three are also the prime rev-
enue earners, not only of the region, but
also of West Bengal. The three are also,
almost totally, controlled by people from
the plains.
West Bengal Chief Minister Mamata
Banerjee’s order that Bengali be made
compulsory in schools across the state
was the spark that rekindled violent agi-
tations in the hills. But this is certainly
not a mere language agitation or just a
AGITATED HILLS
(Clockwise from left) Protests continue for
a separate Gorkha state; troops patrol the
streets; residential school students leave
for home
I
n India, Gorkhas have a very special
status. They are Indian Gorkhas.
That is their legal status and despite
their land of origin being Nepal, they
cannot be called Nepalis, though they
share the same language. They are
Indian as per the Gazette notification of
the Government of India on the issue of
citizenship of the Gorkhas of India.
They do face an identity crisis in
India, though, because of two reasons.
They are not categorised as indigenous
people of India (not of any Scheduled
Tribe). And, the Indo-Nepal Treaty of
Peace and Friendship (1950) that per-
mits “on a reciprocal basis, the nation-
als of one country in the territories of
the other the same privileges in the
matter of residence, ownership of prop-
erty, participation in trade and comm-
erce, movement and other privileges of
a similar nature,” creates an identity
crisis. Hence often Indian Gorkhas are
mistaken for being Nepali people.
What is significant in this is that in
April last year the Modi government
started the process that could lead to
grant of Scheduled Tribe status to 11
Gorkha communities, mostly living in
Sikkim and Bengal. The tribal affairs
ministry on April 2, 2016 set up a com-
mittee under joint secretary Ashok Pai
to examine granting ST status to 11
communities—Bhujel, Gurang, Mangar,
Newar, Jogi, Khas, Rai, Sunwar, Thami,
Yakhha and Dhimal—living in Sikkim
and other Gorkha-dominated states
and areas.That was just before West
Bengal was going to the assembly
polls and the timing was questioned in
many state circles.
In Mizoram (as well as Nagaland),
where many Nepalis were domiciled for
years, they were categorised as “forei-
gners” in early 1990s. In Meghalaya,
the Khasi students and the government
together deported about 7,000-10,000
Nepalis in February-March, 1987. How
many of them were Gorkhas has not
been recorded.
The argument has been: “How can
a certain section of people be “foreign-
ers” in one state, while demand to own
a full state in another region of the
same country?” The term “Gorkha”
would make the legal difference.
If one compares the demand for
Gorkhaland with, say, the Bodoland
agitation, the differences are stark.
The Bodos have been established as
indigenous people of the areas located
in the extreme north on the north bank
of the Brahmaputra river in the state
of Assam. Currently, the map of Bodo-
land includes the Bodoland Territorial
Area Districts (BTAD) administered by
the Bodoland Territorial Council (BTC)
and other parts covering over 25,000
sq km. The territory came into exis-
tence under the BTC Accord in
February 2003.
After the Gorkha National Liberation
Front’s (GNLF) 40-day violent strike in
the 1980s, its leader Subhas Ghising
achieved limited autonomy. The
Darjeeling Gorkha Hill Council got pow-
ers to govern the district, but revenue
was a state subject, so were law and
order and legislative powers.
The Gorkha Janmukti Morcha also
demanded Gorkhaland, but got the
Gorkha Territorial Administration (GTA),
which had no more powers than the
GNLF. The GTA still does not have
powers of legislation. However, there
was a fresh influx of funds from the
centre as well as from Kolkata.
GorkhasofIndiaThe community and its identity crisis
UNI

cultural issue. Even the Nepali popula-
tion/language theory can scarcely be
supported by history.
HISTORICAL PERSPECTIVE
Darjeeling wasn’t a part of Nepal. It was
a part of the Sikkim kingdom, hence
inhabited mostly by the Lepcha and the
Bhutia tribes. In 1790 a Gorkha army
from Nepal invaded Sikkim and anne-
xed large tracts of land including Darj-
eeling, up to the Teesta River near
Nepal. However, the British (East India
Company soldiers) retaliated and in the
Anglo-Gorkha war the Gorkhas were
pushed back in 1817. The army left, but
a Nepali population stayed back in what
originally was Lepcha and Bhutia terri-
tory. They were the original Gorkhas of
India (see box on Gorkha status).
Post independence Darjeeling was
merged with West Bengal as a separate
district. Darjeeling town apart, this dis-
trict included hill towns Kurseong,
Kalimpong and the Terai areas of Sili-
guri. Another mix of ethnicity happened
in 1950 when the People's Liberation
Army of China annexed Tibet. Thous-
ands of Tibetan refugees settled across
the district. Add to that the fact that the
predominant trading community, the
backbone of the district, are mostly
Marwaris and Bengalis from the plains.
Such amix makes Gurung’s claim look
somewhat specious.
Gurung is the principal fomenter of
trouble in the area and has created a
“Gorkha” movement like his predecessor
Subhas Ghising. Three persons have al-
ready died in the latest outbreak of pro-
tests and a police officer critically inju-
red, while work and business remains at
a standstill. Tourists have been forced to
leave during the peak tourist season and
the losses incurred will be huge.
But who is Bimal Gurung? The GMJ
leader came to the limelight through the
television reality show, Indian Idol. No,
he did not sing but he helped a winner
take the singing world by storm. Gurung
was a small-time soldier for Subhas
Ghising in the 1980s. He caught public
attention after he saw the Kolkata police
States/ West Bengal/ Gorkhaland Movement
“It’s not the voice of logic,
but the noise of the gun”
PARTHA CHATTERJEE, the Parliamentary Affairs and Education
minister of West Bengal, is virtually the No 2 in the administration
of Chief Minister Mamata Banerjee. In a telephonic interview with
Sujit Bhar, Chatterjee explains the chief minister and the Trinamool
Congress’ views on the Gorkhaland agitation in Darjeeling
How much of this Gorkhaland agitation
is really about language?
It is certainly not about language. This
is a specious argument. Our netri,
Mamata Banerjee, had personally exp-
lained that Bengali will not be compul-
sory in the hills, where Nepali is the
prevalent language. There is more to
the issue than language, and this has
to be looked into by law enforcement
authorities. It needs a deep probe.
What about the Calcutta High Court’s
order...
If despite what the CM has clearly said,
the agitation continues, then the very
basis of the agitation has no meaning.
The court’s judgement that this bandh
is completely illegal is a sound one,
and one clearly sees a contempt of
court issue cropping up. The court has
to now take action.
If it is not about language, what in your
opinion is the reason for Bimal
Gurung’s agitation?
My reading would be—the funds and
the huge defalcation that has been
going on in the hills. When the GTA
received its `2,000 crore five years
back, it was quiet for a long time. Now,
it is time to explain how the money was
spent. Now is the time for audit. That is
when Gurung wants to create a diver-
sion to take attention away from the
money trail.
Is the BJP behind fomenting trouble in
the hills?
The law will find out who is
responsible and punish
them. As for the
TMC, we are
concerned about
the well-being of the people of the hills.
As our leader said, she wants peace to
return and normalcy is important for the
development of the region. Chaos can-
not help development.
But you surely believe there is a politi-
cal motive.
There surely has been some dirty poli-
tics involved. What is ruling in Darjee-
ling is not the voice of logic, but the
noise of the gun. Since the TMC took
over after the Left Front’s mismana-
gement some good sense had retur-
ned. But now it is time for an investiga-
tion to look into the whys. Mostly, it is
about the money. They needed an
issue to divert attention. Sadly, they
have been aided and abetted by
interested parties.
Do these interested parties include the
BJP? Does the centre have a hand in
trying to destabilise the area to find a
route into West Bengal?
I repeat again, whoever is responsible
will be found out by the law and
punished.
26 July 3, 2017

constable Prashant Tamang, a Nepali
also from Darjeeling, qualifying for the
last rounds of the Indian Idol song con-
test in 2007.
Gurung went all out and helped
Tamang by asking all Nepali-speaking
residents of Darjeeling and adjoining
areas to vote via SMS for Tamang. He
won the 2008 edition of the show and
that literally catapulted Gurung into
the limelight.
DECADES OF MISMANAGEMENT
To be fair to Mamata, she and her Tri-
namool Congress (TMC) have tried to
make the best of a bad deal handed
down, following 34 years of mismanage-
ment by the Left Front governments.
Reacting fast to the depleting cash res-
erves of the tea gardens during the cha-
otic demonetisation experiment of the
Narendra Modi government, she forced
the centre’s hand in releasing cash for
payment to tea estate labourers. She also
undertook a slew of development work.
It’s not about culture, it’s not about a
language—Mamata has made it clear
that the Bengali stricture does not apply
to the hills—it’s about politics and
money. The very basis of the bandh is to
throttle local business, thriving on the
two main revenue pillars, the tea indus-
try and tourism, and gain financial bil-
lets from the centre that mostly disap-
pear into unspecified pockets.
West Bengal government’s Education
Minister Partha Chatterjee, told India
Legal: “The Gorkha Territorial Admin-
istration (GTA) of the GJM had it fine
for five years, and just when it was time
to face audit, and account for the
`2,000 crore it had received and how
they have spent it, they are now trying
other methods to divert attention.”
Chatterjee, who is virtually the num-
ber two in the Mamata Banerjee admin-
istration, was clear in indicating that the
money has disappeared without a trace
of the development it was intended for.
Technically, the Left Front had a similar
grouse against Gorkha National Libe-
ration Front chairman Subhas Ghising,
who started the hill agitation in the
1980s. The “defalcation” of funds has
been mammoth and there has never
been any solid contest of this allegation.
In a late development, Gurung and
43 other GJM members resigned from
the GTA on Friday (June 23), calling it
a “farce”.
Then there is the question of state-
hood. The constitution gives powers
only to parliament to form new states.
The identity of states can be altered or
even expunged only by the parliament.
The constituent assembly had declined a
motion in its concluding stages to desig-
nate India as a “Federation of States”.
That shifts focus to the government
at the centre. In the 2014 general elec-
tions BJP’s SS Ahluwalia won the Dar-
jeeling Lok Sabha seat, taking over from
his party’s earlier winner (2009),
Jaswant Singh from the same seat.
These consecutive wins are spectacular,
considering the only other BJP MP in
this state is a singer and current Union
minister—Babul Supriyo, from Asansol.
The BJP votes in the area were from two
principal sources: anti-TMC sentiment
and the huge trading community from
the plains, mostly BJP supporters.
Interestingly, despite Mamata’s run-
ning battle with the BJP and the centre,
Chatterjee was not too keen in pointing
to the BJP’s role in instigating trouble
(see interview). Clearly, TMC wants to
keep one door open for negotiations.
Mamata, before her departure to the
Netherlands for a UN engagement, had
called for peace in the hills. At the time
of going to press, the army continues to
patrol the area even as GJM rallies per-
sist. The situation remains tense. And,
trouble could boil over any time.
LEADERS’ CONFLICT: While West Bengal
Chief Minister Mamata Banerjee (left) had
called for peace in the hills, Gorkha Janmukti
Morcha supremo Bimal Gurung (right)
continues to create trouble

28 July 3, 2017
States/ Kerala/Godman Case
T is a case that riveted the atten-
tion of people in God’s Own
Country. After all, it involved a
godman and a 23-year-old law
student who bobbitised him on
May 20 for allegedly raping her.
While initially this case was hailed as a
lesson for every criminal attempting to
rape, it took a curious turn when, four
weeks later, the woman withdrew her
charges against Gangeshananda
Theertapada and instead, blamed the
police, leaving the judiciary confused
about the truth of the matter.
AUDIO CLIP
She now claims that she was never
raped or physically assaulted by the
swami. Rather, she says, she was put
under pressure by the local police to
give a statement against him. From
the local police officer who was investi-
gating the case, to the chief minister
who praised the girl for her courage,
almost everyone involved is now embar-
rassed and groping for answers.
What blew the lid off this case was
an audio clip of a conversation between
the woman and advocate S Ajith Kumar
who is appearing for the accused.
In the clip, which was played by
local channels and on social media
repeatedly, the woman clearly says that
the attack on the swami was instigated
by Ayappadas, a close associate of his
and someone she has had a relationship
with. “I only had a fatherly relationship
with the swami. There was no sexual
contact involved at anytime. Whatever
I gave in writing to the police was as
per their wish. The swami has never
tried to even molest me,’’ the female
voice says.
She alleges that it was Ayappadas
who had brought the knife with which
she cut the godman’s genitals. She even
says she has no idea where she had
injured him as she had no intention of
cutting off his organ.
“See there was a plan by Ayappadas
and he was asking me to do it. Initially I
did not want to do but then in the heat
of the moment I did it. Later from the
police only I came to know that 90 per-
cent of his organ had been cut off,’’
added the woman.
The question intriguing everyone is
that if the godman did not sexually
assault her, why did she attack him? She
has still not been able to give a convinc-
ing answer to that.
Unholy
Mess
Thecaseofaswami,bobbitisedbyayoung
woman,hassogrippedthestatethateveryone
cameoutinhersupport.Butwithherretracting
herstatements,thejudiciaryisflummoxed
By Naveen Nair
in Thiruvananthapuram
A MAN OF GOD?
Gangeshananda
Theertapada (right
and inset) was violently
attacked by a woman
for allegedly
raping her
I UNI

Many now speculate that she had a
relationship with both Ayappadas
and the godman and when the former
discovered it, he asked her to attack
the swami.
MEDIA TRIAL
When the incident took place, the
woman had got wide support from the
public. Activists who made a beeline
for her house proclaimed her as “the lat-
est torchbearer of women’s freedom and
security”. The swami, on the other hand,
was painted as a monstrous villain,
especially as the woman told the police
that she had been raped ever since she
was a child. The swami was shamed and
shunned over social media as well.
Old photographs of his were pick-
ed up by political parties to settle scores
with those who had got themselves
clicked with him, even if accidentally.
The list included state BJP president
Kummanam Rajasekharan, who later
gave a clarification about his associa-
tion with the godman. Meanwhile, the
famous Panmana Ashram in Kollam to
which the godman is believed to
be associated with, distanced itself
from him.
S Ajith Kumar, the swami’s advocate,
told India Legal: “The shame that my
client had to go through in the last few
weeks is immeasurable. This was taken
to this extent by some activists who
were making the girl give such reports
to the police. Now that she has retrac-
ted from her initial stand, the court
has to decide whether my client who
always had a respectable position in
society should be more tarnished by a
bogus case.’’
Kumar said he had a suspicion all
along that some people had a hand in
the woman’s statement and was confi-
dent that if he got a chance to talk to
her, she would open up, which she did.
“I took the chance which many people
may say is unethical as I am the lawyer
of the accused. But then see how the
truth came out,’’ Kumar added.
Even though the woman wrote a
handwritten statement to Kumar des-
cribing the real events, he decided to
record her phone call as proof in case it
was admissible later in the court as evi-
dence, something which is remote.
Right from the beginning of this
case, there were many loose ends. For
instance, if she had indeed been raped
over the years by the godman at her
house, how was her family not aware of
it? Some said her own mother was in a
relationship with the godman and that it
was with her knowledge and agreement
that her daughter was also being used
by the godman. And though the mother
was picked up for questioning by the
police, there was no credible evidence of
her involvement.
POSCO CASE
The police has registered a case against
the godman under the Protection of
Children from Sexual Offences (POCSO)
Act as the offence started when she was
a child. The woman now alleges that the
police actually wanted to book the god-
man under POCSO and had coaxed her
into giving a statement against him.
Amidst all the allegations and count-
er-allegations, the police decided to
move the case to the Crime Branch-
Crime Investigation Department (CB-
CID) and sought the permission of the
court to conduct a lie detector test on
the woman. She has, meanwhile,
requested for a CBI probe into the inci-
dent. The court has asked her to appear
before it on June 26 when it will decide
the further course of action.
Activists who stood by the woman
are today shocked. “If this is what hap-
pens when some of us genuinely stand
by victims, then whom do we trust
from now on? If she turns out to be
the perpetrator of the crime, how will
you restore the dignity of that man?’’
asked a woman activist who wanted to
remain anonymous.
Meanwhile, there are rumours that
the whole case was turned on its head
after the RSS put pressure on the girl to
change her statement in favour of the
godman. The mystery continues.
Theswamiwaspaintedas
amonstrousvillain,especiallyas
thewomantoldthepolicethat
shehadbeenrapedeversince
shewasachild.
SEVERING TIES
The Panmana Ashram in Kollam (left)
has distanced itself from the godman

Economy/ Banking/ NPAs
30 July 3, 2017
HE economic bustle which
the Narendra Modi gov-
ernment had wanted to see
has taken a hit. This was
evident in the banking sec-
tor, where the non-per-
forming assets (NPAs) of some banks,
especially public sector ones, have
grown alarmingly. One estimate put the
total figure of NPAs, including public
and private sector banks, at `6,97,409
crore in December 2016.
While the BJP-led NDA government
has been on top of the game as far as
politics is concerned with its tremen-
dous win in the Uttar Pradesh assembly
elections in March, there is the nagging
awareness that this is not so for the
economy. A major reason for this sorry
state of affairs is NPAs, the dirty heap of
debt which is causing a stink in the
economy. Something had to be done.
The government found a way out. It
Naming and Shaming
Thegovernmenthasdecidedtousethe2016InsolvencyandBankruptcyCodetotacklethe
baddebtofbanksanddeclaredefaultingcompaniesinsolventandbankrupt
By Parsa Venkateshwar Rao Jr
T
The National Company Law Appellate
Tribunal (NCLAT) dealt with two cases
involving private bank ICICI and default-
ing company Innoventive Industries Ltd
in one and Starlog Enterprises Ltd in
another. Both were disposed of by
NCLAT in May.
While ICICI lost the first case, it
prevailed in the other. This shows that
once insolvency proceedings are initiat-
ed, it remains open for any one of the
parties—creditors (ie, lenders such as
banks) or debtors (companies unable
to repay loans)—to go to court and raise
questions about the fair implementation
of the Insolvency and Bankruptcy
Code (IBC).
In the Innoventive Industries Ltd v
ICICI Bank and others, NCLAT ruled on
May 15 that there was no need for the
National Company Law Tribunal, Mumbai
bench, to have given notice to
Innoventive Industries after ICICI Bank
had filed a case under the IBC. All that
the Tribunal had to do was to satisfy itself
that the failure to pay debt was estab-
lished through documentary evidence.
The company also invoked an earlier
debt restructuring agreement under the
Maharashtra Relief Undertaking (MRU)
Special Provisions Act 1958 to prevail
over the IBC. NCLAT rejected the argu-
ment outright.
NCLAT said that though formal notice
was not given to Innoventive Industries
Ltd after ICICI Bank had filed a petition
under the IBC, NCLT had heard the
objections of the defaulting company.
Therefore, the formality of issuing a
notice is not mandatory. But it sounded a
cautionary note: “However, in some of
the cases initiation of Insolvency
Resolution Process may have adverse
consequences on the welfare of the
Company. Therefore, it will be imperative
for the adjudicating authority to adopt a
cautious approach in admitting
Quickresolution
How insolvency cases play out
Illustration: Anthony Lawrence

decided to use the Insolvency and
Banking Code (IBC), which was passed
last May, to tackle it. One of the ways of
clearing the debt is to declare that the
companies which have piled up NPAs
are not in a position to repay. They have
to be declared insolvent and bankrupt.
In one way, it is writing off the debt. But
doing so would send out a bad message
—that companies can borrow freely
from banks and if they can’t pay it back,
the debt would be written off. The IBC
is the legal and commercial way of writ-
ing off debt. It means that debtor com-
panies will have to face the humiliation
of being declared insolvent and bank-
rupt. There is a legal procedure to do
this and it is good for debt-ridden banks
as well as defaulting companies to go
through the ritual commercial funeral.
Some pop sociologist may describe this
capitalist caper as material, if not emo-
tional, catharsis. But it is an effective
way of clearing the mess.
With the government choosing this
route, there has been uncharacteristic
quickness by the finance ministry and
the Reserve Bank of India to deal with
these NPAs. On May 4, the ministry
issued the Banking Regulation
(Amendment) Ordinance, 2017, which
empowers the central bank to issue nec-
essary directions to banks to deal with
the NPAs. The ministry noted that “the
stressed assets in the banking system
have reached unacceptably high levels
and urgent measures are required for
their resolution…” It also stated in
unambiguous language what it wanted
the RBI to do in Section 35AA: “The
Central Government may by order
authorise the Reserve Bank to issue
directions to any banking company or
banking companies to initiate insolven-
cy resolution process in respect of a
default, under the provisions of the
Insolvency and Bankruptcy Code, 2016.”
The RBI responded on May 22. It
had expanded the two-member
Oversight Committee appointed by the
Indian Banking Association and to work
out ways “to resolve the large stressed
assets in the banking system in a value
optimising manner”. It seems that the
RBI is still looking for ways to restruc-
ture the debt.
Insolvency Application by ensuring
adherence to the principle of natural
justice.”
On the issue of the state law—MRU
Act—prevailing over IBC, the Court said:
“The protection under the MRU Act,
therefore, cannot be extended to other
legislations especially to union legislation
which is subsequent to the MRU Act and
related to insolvency resolution i.e. I&B
Code, 2016.”
It is to be noted that ICICI Bank had
filed its initial application against
Innoventive Industries in January, the
Mumbai bench of NCLT gave its verdict
in the same month and NCLAT disposed
of the appeal in May. This was quick
considering
the tortuous
procedure
and time
taken for
regular litigation. Of course, the imple-
mentation of insolvency is sure to take
more time.
In the second case of Starlog
Enterprises v ICICI Bank, NCLAT
penalised the Bank for giving the wrong
figure of the debt amount and dismissed
the ex-parte order of the Mumbai bench
of NCLT. The Tribunal order was given on
February 17 and the appellate tribunal
set it aside on May 24.
NCLAT asked ICICI Bank to pay a
fine of `50,000 for the incorrect claim.
The appellate tribunal accepted the
objection of Starlog Enterprises about
the discrepancy in the amounts demand-
ed by the Bank. In its notice to the com-
pany on February 6, the Bank stated that
the amount due was `10,02,28,271.60,
while in the application it filed before the
NCLT on February 8, it stated that the
due amount was `29,81,02,395.62. The
appellate tribunal took strong objection
to the “incorrect claim”.
Withthegovernmentchoosing
thisroute,therehasbeen
uncharacteristicquicknessby
thefinanceministryandthe
RBItodealwiththeNPAs.
UNI
CLEANING
THE MESS
RBI Governor
Urjit Patel
(above) and
private bank
ICICI (right)
equitypandit.com

Economy/ Banking/ NPAs
32 July 3, 2017
Bhushan Steel ` 44.885
Lanco Infratech ` 45, 436
Alok Industries ` 22, 919
Monnet Ispat ` 12, 737
Electrosteel Steels ` 11, 304
Jaypee Infratech ` 10,106
Era Infra ` 6,509
Source: Credit Suisse
Essar Steel ` 37,284
IVRCL ` 10,107
Sterling Biotech ` 4,790
Moser Baer ` 4,610
ABG Shipyard ` 9,290
Source: Bloomberg
Thedirtydozen
The central bank had made a begin-
ning to resolve this issue on June 13
when its Internal Advisory Committee
(IAC) recommended that 12 accounts
which owed more than `5,000 crore
each to banks, 60 percent of which is
bad debt, would have to be referred to
insolvency proceedings. The June 13
RBI press note significantly notes: “The
Reserve Bank of India, based on the rec-
ommendations of the IAC, will accord-
ingly be issuing directions to banks to
file for insolvency proceedings under the
IBC in respect of the identified
accounts. Such cases will be accorded
priority by the National Company Law
Appellate Tribunal (NCLAT).”
D
espite the urgency shown by the
finance ministry and by the
RBI, things may not have
moved as quickly as desired. The fast-
tracking of NPA cases may not prove to
be easy. The IBC is yet to take root as it
requires technical expertise in the form
of interim resolution professional (IRP),
as well as due process. It may be much
less than a protracted legal processes in
a regular court of law, but there is no
way that a procedure that gives a sense
of fair play can be pushed aside.
On June 15, the Insolvency and
Bankruptcy Board of India (IBBI) noti-
fied the Insolvency and Bankruptcy
Board of India (Fast Tract Insolvency
Resolution Process for Corporate
Persons) Regulations, 2017. The IBBI
note said: “These regulations provide
the process from initiation of insolvency
resolution of eligible corporate debtors
till its conclusion with approval of the
resolution plan by the Adjudicating
Authority. The process in these cases
shall be completed within a period of 90
days, as against 180 days in other cases.”
If the adjudicating authority decides
to give extra time, it might do so by
extending it by 45 days. There is a catch
here. If the IRP (Internal Resolution
Person Professional—he will look at the
accounts of the defaulting company and
come up with the strategy to go for-
ward) feels that the case need not be put
on the fast track, then he can recom-
mend to the adjudicating authority that
it can be dealt with as an ordinary case.
Of course, when the RBI decides that
the 12 cases it has identified should be
put on the fast track, there may not be
any further legal hurdles. But the proce-
dures laid down in the IBC will have to
be followed. (See Box)
A glimpse at how insolvency cases
play themselves out can be had by look-
ing at the disposal of cases by the
National Company Law Appellate
Tribunal (NCLAT). It has dealt with 20
cases which have been brought by pri-
vate sector players in these six months.
Sixteen of the 20 have been decided in
May alone. And these are appeals which
have been decided by National Company
Law Tribunals benches in Ahmedabad,
Allahabad, Chandigarh, Coimbatore,
Delhi, Kolkata and Mumbai.
The moot question is whether the
insolvency law will facilitate the quicker
resolution of bad debts. The government
is keen to try it out and has asked the
RBI to use the IBC. It’s a wait-and-
watch game now.
Figures in crores
WAITING FOR ACHHE DIN
Long queues outside banks
when the demonetisation
move was announced
Neither the RBI nor any of the Public Sector Banks have revealed the list of
big defaulters. The lists made available are those of probable defaulters,
who would be there in any list because of the amounts they owe to banks.
Here is a list probable defaulters cited by Credit Suisse and Bloomberg.
UNI

Briefs
Deputy SP Mohammed Ayub Pandith
was lynched near Jama Masjid
mosque in Nowhatta, Srinagar, on June
22. Pandith was doing surveillance work
and taking pictures of people coming out
of the mosque when a rampaging mob
spotted him.
The policeman was forced to use his
service revolver to defend himself and
injured three in the firing. However, he
was overpowered and beaten to death on
the street shortly after midnight.
The city’s old parts have turned tense
following the incident. Muslims are
observing Shab-e-Qadr (the night of
power) with night-long prayers.
The police immediately restricted the
movement of people and vehicles in the
old town area as a precaution.
Srinagar mob lynches DSP
for taking pictures
The Union home ministry has extend-
ed the visa of Bangladeshi author
Taslima Nasreen for one year, with effect
from July 23, 2017. Nasreen is officially a
Swedish citizen and has been getting visa
extensions since 2004. The 54-year-old
writer has been living in exile since 1994,
when she left Bangladesh after funda-
mentalist groups of the country issued
her threats following her novel Lajja. She
had also expressed her desire to live in
India, especially Kolkata, failing which
the writer said, that she might suffer an
identity crisis and her writing would also
get affected.
Taslima Nasreen gets visa
extension for a year
An expert committee formed by the
health ministry, following a represen-
tation sent by Minister for Women and
Child Development Maneka Gandhi on
replacing gelatin capsules with plant-
based ones, has invited suggestions from
all stakeholders. Gelatin is obtained by
boiling the tissues, bones and skin of ani-
mals and is used by 98 percent of the Ind-
ian pharmaceutical industry. Gandhi had
said that India is a country of millions of
vegetarians and therefore using animal-
based gelatin capsules hurt their religious
sentiments. The Drug Technical Advisory
Board had however turned down the
health ministry’s proposal to mark plant-
based capsules with a green dot.
Health ministry forms panel
for veg capsules
The Rashtriya Janata Dal chief Lalu
Prasad Yadav and his family mem-
bers have been charged under the Benami
Transactions Act 1988. Yadav, his wife
Rabri Devi, daughter Misa Bharti, son-
in-law Shailesh Kumar and son Tejashwi
Yadav have been booked by the Income
Tax Department for being beneficiaries of
benami properties across Delhi, Guru-
gram, Rewari and Patna. The IT depart-
ment, under section 24 (3) of the Act, has
attached 12 plots and other properties
belonging to all of them. The Delhi wing
of IT department had earlier issued sum-
mons to Misa Bharti and her husband
but the couple never showed up.
Karnataka has decided to reserve 50
percent of seats in the National Law
School of India University (NLSIU), Ben-
galuru, for local students. An amendment
to the National Law School of India Act,
1986, was unanimously passed in the leg-
islative assembly but is yet to be passed in
the legislative council. The Bill originally
provided for 30 percent reservation for loc-
als, which, on the request of BJP members
was extended to 50 percent. The law has
also incorporated clauses to check the resi-
dential status of the students. The admis-
sion is currently done on the basis of the
Common Law Admission Test.
50 pc law seats for
locals
—Compiled by Lilly Paul
Lalu’sfamily
bookedfor
Benami
deals

34 July 3, 2017
Courts/ Rajasthan/ Right to Information
N June 13, five Right to
Information (RTI)
activists were sentenced
to four months jail by a
court in Rajasthan after
being convicted of “tres-
pass and hurt”, in a 19-year-old case.
Nikhil Dey, former sarpanch Naurti Bai
of Harmada in Ajmer, Ram Karan,
Babulal and Chotu Malakar were con-
victed under Sections 323 (punishment
for voluntarily causing hurt) and 451
(trespass) of the Indian Penal Code for
raising their voices against alleged cor-
ruption by Pyare Lal Tak, then sarpanch
of Harmada. The sentence has been sus-
pended pending appeal by the activists
in the higher court of Kishangarh addi-
tional district judge. This has brought to
light the plight of RTI activists in the
country who are constantly intimidated,
attacked and murdered for seeking
information against corruption.
It all began in 1998 when the acti-
vists had sought information on pay-
ments for development works in the vil-
lage. Before the RTI Act was promulgat-
ed Dey, Aruna Roy and other activists
were involved in educating rural citizens
that RTI was their fundamental right.
As part of this, they were seeking infor-
mation from Pyare Lal, who was also a
liquor contractor of the village.
Dey and four others had alleged that
the payments for toilets, Indira Awaas
houses and labour payments for devel-
opment works had not been made to the
beneficiaries. They had visited the sar-
panch’s office 73 times but failed to get
the information.
The Mazdoor Kisan Shakti Sanga-
than (MKSS), the organisation under
which the activists worked, said in a
press note: “Because his (sarpanch) off-
ice was usually closed during working
hours, the activists went to his house to
ask for the information with an order
from the BDO (block development offi-
cer). The sarpanch came out of his hou-
se and physically assaulted the activists.
Despite the attack, the activists decided
not to file an FIR, thinking that right to
information cannot depend on police
LongHaul
ForJustice
RTIactivistsNikhilDey,NaurtiBaiandthree
otherswereconvictedina19-year-oldcasebya
Rajasthancourt.Theywereallegedlyframedfor
seekinginformationinacorruptionmatter.Onlya
highercourtcannowprovidethemrelief
By Usha Rani Das
O
Amitava Sen

India Legal 03 July 2017

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