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“Our policies are transparent … whenever there is any misapprehension, we are ready to listen to them
and readjust it when it is necessary. “Therefore, we are not having any fixed mind with respect to a
particular issue, but what is to be done has to be done within the legal system and legal framework,” he
said at a think-tank here responding to the concerns of the US industry.
“They (US businesses) have some doubt whether the tax regime in India is stable or not. It is stable. Even
the current amendment, which is being debated, I have explained it that the nature of the amendment,
which I have introduced, is of clarificative nature and not substantive amendments in the contents of
the law,” he said.
“One question comes to the mind that when you are giving retrospective effect to the law from the date
of enactment of the Income Tax Act, 1962, can the income tax cases be opened since 1962, the answer
is no. “Because there are other provisions in the Income tax Act itself, according to which no case can be
reopened which is more than six years old,” he said.
“Therefore, there is no uncertainty and attempt is being made to give certainty… Secondly the
investment decision is not taken merely whether there is tax concession or not.” He was answering
questions at the Peter G. Peterson Institute for International Economics, which had organized an event
jointly with the Confederation of Indian Industry (CII).
Mukherjee was addressing concerns expressed in the US, including by Treasury Secretary Timothy
Geithner, that the proposed amendment to the IT Act to reopen the Vodafone case has dampened
enthusiasm over investment in India. But, he said, before readjusting decisions the government must be
convinced on the necessity of such a change.
Responding to a question, he said the current sense of “despondency” is mainly because of their
“misapprehension”. There are 10 legislative amendments, he has proposed in his budget, he said.
“What is the size of the market? Whether there are systems which are transparent and tested and
thirdly what is the purchasing power of the people. From these entire stand points, India is a good
investment destination, so therefore there should not be any apprehension,” Mukherjee said.
Mukherjee said the relationship between the two countries is expanding and is very much on the right
track. It is all comprehensive. Hardly there is any area where there is no interaction with the US. “In all
area, our strategic partnership is becoming comprehensive.
Therefore I do feel that in coming years our relationship would move from strength to strength,” he
said. “Our strategic global partnership with the United States is truly transformational in nature. We are
not only discussing issues such as strategic cooperation, counter- terrorism, defense, high technology,
civil nuclear and space sector cooperation but also a broad range of development issues that directly
and positively impact our citizens,” he said in his remarks earlier.
Mukherjee announced that the India-US Economic dialogue would be held in June this year. During his
meeting with Geithner, he extended the invitation to the latter to come to New Delhi.
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