Prime Minister Narendra Modi disclosed that the registration of over 1 lakh companies which had allegedly engaged in suspicious transactions post-demonetisation had been scrapped as he sought to cast the GST as his second strike against black money and corruption. “Forty-eight hours before the launch of GST, we, by one stroke of pen, cancelled the registration of 1 lakh companies which, based on the mining of deposits made in banks after November 8, were found to have engaged in serious irregularities,“ Modi said, adding that 2 lakh other companies were under the scanner.
He also said the government has identified 37,000 shell companies which engage in money laundering and help those with black money.
Modi's disclosure at a function organised to mark the foundation day of the Institute of Chartered Accountants in India came amid clear indications that the government is moving swiftly to turn the switch to GST and its successful implementation as part of his campaign against black money and corruption. The decision to de-register one lakh companies in one stroke is reflective of the government's intent, as well as a pointer to the willpower of the political class. Such decisions are not taken on the basis of political calculations, they can be taken only by those who love the country ,“ said the PM.
In his address to chartered accountants, he asked them to help with the successful implementation of GST in order to curb tax evasion. “I invite you to join the festival of honesty,“ Modi said, adding that while implementing the Swachh Bharat Abhiyan, his government was also seeking to clean the economy by acting tough with those who have looted the country .
The focus on corruption and black money reinforced the indication about his plan to expand GST into an instrument for the campaign against corruption and poverty. Just like his speech in the Central Hall of Parliament to mark the launch of GST, the PM said the measure will help curb tax evasion and generate resources to help the poor and needy.
The nearly three-hour long function was telecast live by the national broadcaster and chief ministers of BJP-ruled states and Union ministers joined chartered accountants in state capitals to listen to his speech, an indication of the plan to ramp up pro-GST advocacy .
The government also took a tough line on traders opposing GST, with finance minister Arun Jatiley saying that a “section has started treating tax evasion as their birth right, Jaitley said: “This government will not succumb to pressure from those who have incomes of Rs.50 crore or more but would not pay taxes.“