Chaos over VDIS

NEW DELHI, June 18: No, people being prosecuted under FERA, or even those against whom inquiries have already been launched, cannot declare...

NEW DELHI, June 18: No, people being prosecuted under FERA, or even those against whom inquiries have already been launched, cannot declare this income under the Voluntary Disclosure of Income Scheme VDIS and avail of the various immunities the scheme offers. This was stated by the Revenue Secretary NK Singh in response to a fax from The Indian Express to Finance Minister P Chidambaram.

The clarification set at rest the confusion on the matter which was, ironically, created at the high-profile launch of the scheme today. The scheme was formally lauched in the Capital today by Ravi Kant, chairman of the Central Board of Direct Taxes CBDT at a crowded press conference.

The confusion began when journalists asked Ravi Kant as to whether individuals who were currently being investigated under FERA could avail of VDIS. Thus, for example, could the high-profile chief of Shaw Wallace, M R Chhabria file a declaration under VDIS for the money he is alleged to have taken out of the country? After all, while Chhabria has been summoned to the Enforcement Directorate for questioning, he has not been proved guilty so far.

While not wishing to get into details of specific cases, Ravi Kant told journalists that it was possible for such people to declare their assets under VDIS 8212; and avail of the immunity the scheme offers 8212; provided 8220;an order of detention8221; has not been passed against the individual.

Since Ravi Kant did not wish to comment on questions as to what an 8220;order of detention8221; actually meant, this reporter put the same question to A K Batabyal, Member Investigation of the CBDT 8212; Batabyal was among the five senior CBDT officials present to answer all queries on VDIS. Batabyal also confirmed what Ravi Kant said, while cautioning that one should look at the FERA Act to see what 8220;order of detention8221; actually means.

Journalists also asked CBDT officials to comment on reports that the government plans to go slow on their search and seizures during the period during which VDIS will be operational from July 1 till December 31 8212; so as to allow tax offenders to come clean. While Ravi Kant gave the impression that this was bound to be the case since tax-evaders had to be given a chance to come clean, the ministry of finance later clarified that this was an incorrect interpretation, and that there would be no let up in such operations.