The judgement of the Delhi Bench of the Tribunal in Mayawati vs. DCIT, and the hysterical reactions thereto by the opposition political parties, makes interesting reading. The Tribunal was faced with the question whether whopping “gifts” amounting to Rs. 12 lakhs in cash and Rs. 62 Lakhs in immovable property received by the Dalit Czarina was assessable to tax as unaccounted income.
The Officer’s incredulity at the BSP Supremo’s claim that she had received “gifts” was founded on the fact that the so-called donees were seen to have borrowed moneys to bestow the largesse. They were not family members of the Dalit leader nor was there any other relationship. There was also no “occasion” for the benevolence, he claimed. Ergo, the bonanza was nothing but Madam’s illegitimate income, he alleged.
The Tribunal, however, did not have the same suspicious mind as that of the Officer. It took the view that “the aspect of voluntariness depends upon the mental state. The element of love and affection relate to emotions of a man. One may be impelled by his conscience or may be moved by emotions to part away with his wealth or property and to give the same to a particular person for whom he has developed love and affection. Such a desire can be developed at any time and on any ground. The factors which weigh for executing such desire are best known to the donor. It is not easy to make probe into such human psychology or human emotions which one may carry at the time of making such sacrifices. It has been stated by some of the donors that the assessee was engaged in the welfare of downtrodden and dalit in the society. May be the prompting motive were such appreciable deeds of social welfare of the problem of the weaker sections of the society, which made the donors to make gifts to her”.
The Tribunal also did not agree with the Officer’s grievance that there was no “occasion” for the bonanza. It held “For giving gift no specific occasion is required, although the gifts are normally given on many occasions like birthday, marriage anniversary and other events. However, gift may be given at any time as per the wishes of the donor and the donee. Thus it can not be said that if a gift is not made on particular occasions on any event then such gift is not a genuine gift.”
The fact that the donors had borrowed funds to finance the largesse also did not unduly worry the Tribunal. It gave a clean chit to the Dalit Supremo by observing “It is not uncommon that people give donations and charities to persons in whom they place faith or for whom they have limitless regards. Similarly gifts are also made of invaluable properties for furtherance of noble objects executed by personages of high eminence. As stated by the donors in their statements recorded by the A.O., the donee is a public and political figure who was working for the welfare of the downtrodden in a missionary manner and on account of this social work, the donors decided to part away with their properties by giving the same as gift to her. The element of reverence, veneration or personal esteem and faith all depend upon personal feelings and desire. No probe can easily be made into such aspects of human psychology and the best persons to explain such feelings and desires are those who advance and execute the same.”
The opposition political parties, however, continued to be skeptical about the Dalit Supremo’s source of riches and lost no time in condemning the judgement. Of course, their criticism was dictated more by political compulsions than by any appreciation of the legal nuances of the case. The Times reported that the Congress called the judgement a “farce”. “We are confronted with the most unusual order of the tribunal,” it quoted Congress spokesperson Abhishek Singhvi as saying when reporters sought to know his party’s official position. The BJP was also reported as calling the judgement a “disturbing” act. “We are very concerned. Cash and properties are being shown as gifts from followers. It has the potential to legitimize corruption” BJP spokesperson Ravi Shankar Prasad was quoted as saying.
Madam Mayawati was not without her supporters, though. The judgement roused her fans to collect a mind-boggling Rs. 8 crores on January 15th, her 52nd birthday. The birthday was celebrated as ‘Arthik Sahyog Diwas’ and all revelers were instructed to contribute only in cash and not in kind. The Indian Express reported that Behenji, still stinging from the flax she had received from the opposition parties, had asked ‘party workers and well-wishers to undertake welfare activities for helpless widows, the old and meritorious poor students’ on the occasion. “This would be the most valuable and important gift for me,” she was quoted as saying and as asking BSP workers to celebrate the occasion with simplicity in view.
The fallout of the controversy was the report that Madam had paid an astonishing sum of Rs. 15 crores or thereabouts as advance tax in the third quarter ended December 2007. This has catapulted her from the poverty-stricken hinterland into the rarified world of the rich and famous populated only by billionaire businessmen and film stars. It will be interesting to see whether, having protected herself against the adverse consequences of non-payment of advance tax; Behenji files a claim for refund of the taxes on the ground that the “gifts” are not chargeable to tax.