No post-mortem of records of small traders, factories before note ban: PM Modi

Tax officials will not examine “old records” of small traders and factory owners should they go digital with their business, Prime Minister Narendra Modi said on Friday, seeking to allay fears of harassment among a chunk of the BJP’s traditional voters.

Modi’s comments came after the Rashtriya Swayamsevak Sangh (RSS) and several BJP lawmakers warned the party leadership this week that the cash crunch following the recall of high-value banknotes could harm the party’s prospects in next year’s assembly polls. RSS is the BJP’s ideological fount.

Also, an internal survey on medium and small scale industry by an RSS affiliate showed that nearly 70% of respondents complained their business was hurting from the scrapping of 500-and 1000-rupee notes.

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“Some traders think after going digital they will register higher turnover. And then tax people will come and say, if in December you have done business of Rs 2 lakhs then why did you show just Rs20,000 turnover in July,” Modi said at the BJP’s parliamentary party meet.

“I have told officials not to do post-mortem of old records. Otherwise, you can’t bring anyone into the mainstream.”

Modi said factory owners also pay many workers in cash to hide their scale of operations and avoid legal hassles.

“I have told labour ministry no records before 8 November will be reopened. This officershahi will not be done. We want to make people free from officershahi.”

The Prime Minister refuted allegations that demonetisation was done without homework.

“We make full plans. We don’t act piece meal. Lekin patta dheere dheere kholte hain,” he said. He added that someday bank loans will be secured in six minutes, just on the basis of a business’s digital records.

Attacking the Congress for opposing demonetisation, Modi narrated how in 1971 then PM Indira Gandhi refused to scrap high-value banknotes for fear of losing elections.

Speaking for the first time after Congress vice president Rahul Gandhi accused him of “personal corruption”, Modi said, “The root of the problem is that for the Congress, the party is more important than the country. But for the BJP, it is the other way around.”

In 1971, Modi said, the Wanchoo committee had recommended demonetisation. “Senior IAS officer Madhav Godbole has written in his book “when finance minister YB Chavan told Indira Gandhi about the proposal and that it should be accepted, Indiraji asked, “Are no more elections to be fought by the Congress party?”

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Senior Congress leader Ahmed Patel hit back at Modi. “From (former President) Rajendra Babu to (Prime Ministers) Indiraji to Dr Singh, we have been consistent in opposing note ban. Those in habit of U-turns should read history properly,” he tweeted.

Modi also invoked the 1971 Indo-Pak war to counter the Opposition’s criticism against the army’s surgical strike on militant bases in PoK on September 29.

“On this day in 1971, Indian army made Pak army bite the dust in Bangladesh. No one asked for proof from them. And now, soldiers are asked to submit proof,” he said.