International Indexed & Refferred Research Journal, October 2012, ISSN 0975-3486, RNI- RAJBAL 2009/30097: VoL IV *ISSUE- 37

Research PaperEconomics

Black Money and Corruption; Causes and Remedies

* Dr.Jaywant S.Bhoyar October,2012 * Principal, Late Baburao Patil Art's & Science College, Hingoli, (M.S) After the independence of our country, whatever the the country. So also in order to protect these officers problems were there. The Government has tried its more dutiful and having effective moral values political level best to overcome and solve these problems; dur- bureau is required Never the less, it would not be proper ing the past 65 years of independence. The resulting to say that the whole political system is corrupt. Though fruit of these efforts is that the country has been devel- India is professing to the supreme power, it is seen that oped to a lot. But at the same time, while developing our in India corruption is becoming reception. Corruption country, the serious problem of 'Black Money and is not the problem of the present, but it was present in Corruption' has been emerged. The black money is also ancient and middle age also. This is seen from the called as parallel economy system. Due to this parallel historical epics also Kautilaya in his book "Kautilaya's economic system obstacle has been created. The sta- Arthashastra" has illustrated one example where he bility of development and progress. The black money has quoted that, if a drop of honey is put on the tongue is created by way of illegal practices and the control of of a person, he and he only can have a taste of that Government is not desired by such people. Therefore having easily. So also, the revenue collecting officer the ratio of black money is double than the legal money can easily do the corruption. in our economic system. The black money is evolved There appears corruption in most of the counby means of hoarding and selling the commodities tries in the world more or less up to 1882. To give gifts more than the double rate, hiding income, non crediting and presents to the big officer is also described as the stamp duty and registration fees, tax evading and corruption. During 21st century as far as the person taking/giving of bribes etc. Such money is spent for becoming big, his domestic needs are increasing. In enjoyment and entertainment, errection of luxurious order to fulfill these needs the person is trying to earn building, selling and purchasing of land, purchase of more money by illegal methods. From this illegal method gold and silver as such the black money is not utilized exploitation, extraction black marketing expanding of for production purposes. Therefore the black money is public money, deceiving etc. is increasing day by day. a source of corruption. The black money and corrup- Adverse effect of black money is being made on the life tion are the two sides of the same coin. The money of the people. It is obviously, doubtless that the democwhich is earned by means of illegal method is consid- racy may be endangered if black money is not conered as black money. And the money earned by legal trolled well in time. method but, hidden from paying income tax or evade The money earned by adopting improper and income tax, is also called black money. immoral method is considered as black money. AccordNobody can deny the truth that the corrup- ing to article 161 of the constitution of India if a Govtion is born from black money. The disease of corrup- ernment servant while performing his public duty retion has been rooted throughout, our economic system, ceives gifts and honour more than, what is payable to and therefore it will not be wrong to say that, in order him as legitimate salary, such action is called corrupto prevent, black money and corruption it is essential tion. Black money is created from such act. According that the complete economic system is required to be to Robert Book, the corruption is such act, which is changed. against the social change, self conscious and public The corruption is created through black will. According to opinion of Saitanan committee, the money. It will not be wrong to say that the attack of corruption means misuse of the post held for the selfish corruption has begun not only in India, but also through- motto. out many countries right from ancient age.Kautilya in India has also signed the International agreehis famous book, "Kautilay's Arthashastra" has pointed ment regarding co-ordination on 1st May 2011 which out that there was corruption in ancient age also. Say, is being implemented from 31st May 2011. Where as, for any country in the world, officers who are having Switzerland has already started implementation of this virtue like honesty, dutifulness & having moral value, agreement wef.24 October 2009. We have to say that the such officers are essential for overall development of bi-lateral treaty has created obstacle in this agreement.
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International Indexed & Refferred Research Journal, October 2012, ISSN 0975-3486, RNI- RAJBAL 2009/30097: VoL IV *ISSUE- 37

Black money of India in Swiss Bank is 1.4 Trillion dollars. We can judge from this as to how far the level of Indian corruption has been developed. Therefore, we should come forward and fight against, taking into mind not only a matter right, but as a responsibility. Out of total accounts maintained in Swiss bank of our people we find 10 accounts out of 100 people are from Hindi film industries person and 5 are included from Southern film industries. In order to bring back the huge black money of Indians. From Swiss Bank, yoga guru Ramdev Baba has wakened the people of the country, through the agitation like fast. Though it is true it is a matter of great problem as to how to bring the money back from Swiss bank. The corruption done by Quatrochi Bros. while purchasing Bofors guns, is one of the biggest quake to the defense forces of our country. This act, is being charged that there was blessing of late prime ministerRajiv Gandhi for this dealing. However, the truth is still behind the curtain. Not only this, but in our country we find many more examples like this. For example, newly pointed out spectrum scam, tax-scam, by Hasanali or it may be Common Wealth Olympic Games scam, by Suresh Kalmadi or it may be mine lustiness scamp by Reddy Brothers in Karnataka. So also the scam in Karnataka by Yadurappa, Take Adarsh Building Scamp, in Maharashtra. Housing Scam by Suresh Jain of Jalgaon in Khandesh, So also unaccounted wealth of Krupa Shankar of Mafiya, the murder of district collectror Raigad, Thakur, or recently evolved coalscam. For all these evils the selfish motto created and these in human deeds are occurred only with the malafide intention to get black money and to make corruption. India stands at 95th number of the 178 corrupt countries in the world. The director of C.B.I. Sillal has pointed out that Rs.25,00 ABIA of India are in the international Banks, whereas in one survey it is stated that, 53% of the Indian people, directly or indirectly involved in corruption activities. Not only this, but when elections are conducted and when black money comes out, there appears that there is no either of political or administrative will to control it. The Global Integrate Institution in its report has stated that, 6 lakh crores of rupees of India have been deposited in foreign Bank. The ratio of non crediting income tax is more in this case. It is also stated in this report, that 63 thousand crores of Rupees of India are credited into different foreign bank. This black money is sent under the plea of funds or foreign trade. Black money in the only centre of corruption and therefore Indian stands at 95th in the list of corrupted countries in the worlds. It is the report of the

various institutions that every year. There occurs corruption of 260 ABJA dollars in our country. Causes of creating Black Money :1) Increasing corruption in Government and admin istration. After the independence most of the po litical leaders are actually drenched in corruption activities due to selfish motto and therefore, there is no fear in the minds of the administrators and result of which the officers in the administration do the work of the people and get bribes a large scale from them and the share of such bribes is also given to the political party in power. In this way the illegal money is collected as a large scale. This is a black money and it affects the economic sys tem adversely. 2) Dangerous for political & economic stability :Black money creates danger for the political and economical stability of the country. No money is available for the development of the country if black money is increased. They obstruct completing the projects which may accelerate the development of the country and due to this the chances of employment are not created. So also non-employment increases and this causes for making efforts to destabilize the Government owing to this Government cannot take decision on important policies. 3) War affairs situation :When there is war affairs situation there is artificial shortages and hoarding commodities and prices are hiked to a lot. Due to which it become very difficult to live for the common people. In order to avoid this situations Government has started rationing system and quota distribution system, so also the rates of commodities are fixed. But the merchants did not distribute these commodities among the poor people and instead of that, they sold there commodities in the market at the higher rates and get profit. So also they started to give bribes in order to escape from the law. The evasion of tax started one black money is exported. 4) Extravagant control on producers :After independence the development of our country began with proper planning but, at the same time Government imposed let of conditions on the industries and due to which there was heavy loss to the producers and in order to avoid this loss, the producers adopted the way of black money marketing and started to get large profits from this black marketing. Extravagant control of Government helped to create black money. 5) Devaluation of property : In our country, daily selling and purchasing are honestly done, then tax is required to be paid on a large scale. In order to avoid this tax, the cost of the

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International Indexed & Refferred Research Journal, October 2012, ISSN 0975-3486, RNI- RAJBAL 2009/30097: VoL IV *ISSUE- 37

commodities is shown less during the selling and buying business. And taxes are avoided. Black money is created due to avoiding of taxes. 6) Peoples tendency towards physical happiness : Day to day, the tendency of the people of our country is being tend to wards physical happiness and enjoyment. They desire and expect to get the things for happiness and enjoyment but they are not ready to do hard work for that. Expenditure increases, but to meet the increased expenditure, the income short falling. For this purpose, the people adopt illegal methods to mitigate the increases expenditure and thus the black money is born. 7) Increasing Party Funds in Politics :It may be National party or State level party they give crores of Rupees as party funds in order to win their party candidate and under the plea of this fund. There are number of illegal works done on a large scale, from which black money is created. Similarly increased public expenses inflation, incorrect information of agriculture production, gambling, speculation, smuggling and such other businesses also help to create black money. Remedies to minimize black money andcorruption :1) To cancel the currency notes of 500 and 1000 and creates hard and fast rules. If the currency notes of 500 and 1000 are cancelled, it will automatically control over such people who have utilized there notes for self interest and the economic condition of the country will be benefited and stabilized. Simi larly hard laws should be passed for giving punish ment to those who have accumulated wealth by such illegal method, so that the black money and corruption will be reduced. 2) It is necessary to inform, that after purchasing of gold and immovable property and while transfer ring such property whether income tax is paid or otherwise. So also, if some property is in foreign countries whether such property is declared or not. The person concerned should ascertain all factors and give the correct information. This provision has been made compulsory.

R E F E R E N C E
1) 2) 3) 4) 5) 6) 7) 8) 9) 10) 11) 12)

3) It has been made compulsory to declare and give information regarding corruption made while dig ging, natural property and mines. 4) It is made compulsory, to impose income tax and pay it on the income earned from the foreign coun tries. 5) To declare selfplan : The Government should make it compulsory to de clare selfplan to declare black money. Which con verts black money into white money when Govern ment declared this plan during 1951-1965 Govern ment had received Rs.50 crores of tax. 6) It is necessary to revise tax procedure and where there are loopholes from laws should be blocked. Similarly changes should be done as suggested by Taxxson enquiry commission 1953. 7) Specific fixed deposit plan of 1981 should be again started, and block money should be brought under the production purposes. This is the motto of this plan. Rs.964 crores was received by the way of taxes and therefore Government should again start this plan. 8) The Government should expand and propagate the banking business and all transaction should be made through bank only. Government should try to im press this on the minds of the people and ensure that no black money is created. 9) In order to protect the social and moral values of the people and all should help for all round develop ment of the country. Government should prepare a National level plan to give training of moral values to the people. 10) There should be raid through the income tax department all these who are from high income group and who are doubtful tax evaders and tax with fine should be recovered after calculating their property and they should be severely punished. 11) The information of double tax plan contract should be given to the people and the black money which is in the foreign countries should try to bring back and the countries with whom contract has been made by exchanging the information should try for stoppage of black money.

Yogasadhana, August, 2002 Maharashtra Times, 2011 Navi Asha Navi Disha- 16 March, 2012 Black Money to Return Upkram, 6.4.12 Indian economy Dutta Sundaram S.Choud Pille- New Delhi. Web-http://indiatimes.com Web-http://Vkacjnibetubdua Pratiyogita Darpan - Upkar Publication, Agri Black Money Debits - Government agrees- white paper times of India, 15 Dec.2011 Terrorism in 21st century M.N.Wadgoankar, Diamond Publication, Pune Black Money and Corruption, Daily Loksatta 2011 Administration by Servants - Dr.Wakodkar, Rajat Publication, Aurangabad.

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