Bhushan Sr wants tax breaks; Bhushan Jr says otherwise

The father wants a tax break for his heart; the son’s heart is set on closing tax breaks. And neither got what he wanted.

Former Union Law Minister Shanti Bhushan, the man who is helping draft a new anti-corruption law in the form of the Lokpal Bill, has just lost his case in the Delhi High Court while seeking a tax deduction on a heart operation. Bhushan had made his claim on the ground that it was an expense incurred due to professional work, says a report in Business Standard.

According to the report, Bhushan, who underwent a heart operation due to work pressure, claimed his heart was a “plant” (i.e. a factory) and the expenditure was incurred on “current repairs”. His earnings went up after the operation, and hence the expenses were “wholly and exclusively” incurred on the professional account. Hence, the expenditure was tax-deductible, too, the newspaper reported.

[caption id=“attachment_19197” align=“alignleft” width=“380” caption=“Father Shanti Bhushan and son Prashant (above)who earn in crores every year, apparently don’t have the same views on tax-breaks for the rich. PTI”] [/caption]

Shanti Bhushan’s son Prashant, on the other hand, is miffed that the government is giving too many tax breaks to the corporate rich. The other day he tore into retired Supreme Court judge BN Srikrishna for a judgment he gave in 2003. According to The Indian Express, Bhushan criticised Srikrishna for allowing the NDA government of that time to give tax-breaks for companies registered in Mauritius.

A tax official in Mumbai had apparently rejected a company’s tax-exemption saying that even though he may be registered in zero-tax Mauritius, his operations were in India, and hence would be taxable here. To prevent a huge exodus of foreign funds due to this tax claim, the NDA government quickly issued a circular clarifying that the tax exemption was valid. It was this circular that Justice Srikrishna upheld when the matter finally wended its way to the Supreme Court.

Bhushan was also critical of Srikrishna, who headed the committee on separating Telangana from Andhra Pradesh, for proposing that Hyderabad could be delinked from any new Telangana state. According to Bhushan, this suggestion of Srikrishna, too, was done at the behest of companies who were keen on keeping Hyderabad separate from Telangana.

But neither father nor son has had much luck with their pet issues. While Srikrishna dismissed Prashant Bhushan’s statement as a rant, the Delhi High Court rejected Shanti Bhushan’s tax-deduction plea by turning his claim that his heart was “plant” on its head. If Bhushan’s heart was really a ‘plant’, it should have found mention in his balance-sheet as an asset, the court observed.

Bhushan Sr did not see the humour in the court’s observations and has vowed to go to the Supreme Court as a matter of principle, Business Standard reports.

Bhushan Jr has not yet responded to Srikrishna’s comment that he was years too late with criticism of his judgment. “If he did not like the (Mauritius) judgment, he should have objected to it then itself. How can he come up with allegations after seven years? Come to think of it, they had moved a curative petition which was dismissed by a five-judge bench. Saying half truths will not help,” The Indian Express quoted Srikrishna as saying.

Father and son, who earn in crores every year, apparently don’t have the same views on tax-breaks for the rich. Equally, the courts do not seem to have the same approach on the validity of various tax breaks.