Malicious, says Sinha

By Our Special Correspondent

NEW DELHI, MAY 28. The Union Finance Minister, Mr. Yashwant Sinha, today warned his detractors who have been attributing personal motives to him for allowing major foreign companies to abstain from paying tax in India, if they prove that their administrative office is based in Mauritius.

``I have taken many things lying down and have rarely reacted to media reports. But if anyone tries to destabilise me, I am prepared to fight it out,'' warned Mr. Sinha. While refraining from naming the corporate houses or interest groups who are behind the campaign, Mr. Sinha said he could not point fingers till sufficient proof was collected but suspected those people for whom his presence in the Finance Ministry was ``not convenient.''

His emotional outburst came against the backdrop of two public interest litigations alleging that over 100 financial institutional investors have only a letterhead existence in Mauritius and take advantage of its Double Tax Avoidance treaty with India. Though these companies have claimed that they have residential status in Mauritius, the petitions have alleged that the companies are actually administered and managed in India.

The charge that the income tax department was restrained from taking action against some FIIs, for non-payment of taxes, because his daughter-in-law was managing one of the most successful overseas fund in India had hurt Mr. Sinha ``emotionally.'' His holding public office should not give a ``licence to people to play around with my reputation.

Media reports alleging malfeasance were part of a ``systematic campaign to malign me'' and ``diminish my image in the eyes of the Prime Minister and thereby create a situation where I am forced to leave''.

The Finance Minister admitted that he had met the Prime Minister briefly in this regard but wanted the interaction to remain private.

``Quite clearly I am in the firing line. If anyone wants the direction of the economic policies to be changed, then I am in the firing line. Obviously there are forces (behind the campaign).''

Claiming that he had the total support of the Prime Minister for his second generation economic reforms, Mr. Sinha said ``the Prime Minister has never given a weak signal on economic reforms. In fact, it has been his stance which has given us the courage to go ahead with the reforms process.''

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