Cautionary tale

In light of the recommendation made by the Tax Administration Reform Commission headed by Parthasarathi Shome, the merger of boards is once again going to be a topic of discussion.

Earlier too, in the context of the growing menace of black money generation, there was a proposal to merge the direct and indirect tax departments on the premise that it would make for better information dissemination, coordination and professionalism in handling tax evasion. But the proposal was deemed unviable.

Ettirankandath Krishnadas

Palakkad, Kerala

Poor policies

The wholesale price index has risen to 6.01 per cent in May. The trend shows that inflation is soaring. Steps taken to mitigate price rise have not yielded the desired results. Food inflation has hurt common people the most. Soaring inflation speaks poorly of the economic policies pursued so far.

The new government, which was highly critical of the price rise of essential commodities,should address the problem. The tax base has to be expanded, leaving the already taxed untouched. The Government must not forget that rising inflation is also the cause of rising corruption and criminal activities.

KV Seetharamaiah

Hassan, Karnataka

Expose the defaulters

In the article “RBI should reveal top defaulters’ names” (June 17), the writer S Adhikesavan has rightly suggested the Act be amended to ensure transparency and disclosure of defaulters’ names. When public money is used to fund loans, writing off bad loans seeking capital from owners is like robbing Peter to pay Paul. With a relatively low capital base, banks are a highly leveraged financial entity as they use huge piles of depositors’ money for their major lending activities. That’s all the more reason transactions should be transparent.

Vazhuthur Raghavan

Email

It is surprising that the RBI proffers the “confidentiality clause” when asked by the CIC to reveal the defaulters’ list. When NPAs have soared, don’t we as common citizens whose money these banks use have a right to prevent “cosy” activities?

The writer is right in seeking the new government’s action to amend laws in favour of transparency. Citizens as account holders in banks and shareholders in listed banks must use all the available resources to get these names. It is time for shareholder activism.

NV Ramamurthy

Mumbai

It is flabbergasting to note that the top 30 loan defaulters account for one-third of gross NPA loans of public sector banks. The RBI should publish the top defaulters’ names to save depositors’ money being misused by mega borrowers. Swiss banks are ready to provide information about black money stocks. So can the RBI.

NR Nagarajan

Sivakasi, Tamil Nadu

Trade unions have been demanding the defaulters’ list for years. The matter was even taken up in Parliament. All this was to ensure discipline in the fiscal system and in governance. Revealing the names will also curtail price rise, corruption, nepotism and so on. Now that the government is not dependent on a coalition, it can act swiftly.

Usha Madody

Mangalore

It is true that NPAs are worrisome but they need not all be the result of wilful default. In the normal course defaults occur due to sluggishness in the economy, especially when the market becomes very weak and products find no buyers due to a cash crunch.

What is gained by revealing the names and causing further problems to honest defaulters? There is need to examine the circumstances leading to the default and to separate genuine cases from wilful default. Action against the latter must be taken through due process of law. How will revealing the names help recover loans?

TR Anandan

Coimbatore

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