By Neeraj Mahajan
“Rules are for fools” – Even today it’s not difficult to find people like Jagdish Chander Pandey who are not worldly wise and end up paying the price. Though he retired as Director General Investigations (Income Tax) –almost all his life he was the proverbial “Taxman in trouble”. Contrary to popular perception of government officials misusing their powers for personal gains– here is a bold and upright income tax officer who always managed to get into trouble for doing the right things and following the rules. His is a great story that elaborates how success and failure are two ends of a wide river. How you bridge the gap and go across is called success or failure.
“I started with gold – ended with silver” – he told the then Finance Minister V P Singh, who presented him with a silver plaque for meritorious service. (His reference was to the irony of a gold medal in Chemistry before joining service and silver plaque while in service) Even after receiving the meritorious service award, he wasn’t exactly jumping with joy.
At 83, J C Pandey is a happy and contented man. All his three daughters are well settled. His eldest son-in-law retired as a Secretary to the Government of India. He obviously couldn’t have asked for more. You can say he tasted the sweetness of success because he retired as Director General Investigations (Income Tax), enjoyed virtually unlimited powers as R. N. Kao’s right-hand man in RAW and while on deputation to Defense Ministry handled the first five-year plan of the Ministry of Defense. But before you form an opinion, wait till you hear the whole story.
Success and failure are not permanent. The good times did not last very long. Hidden behind the facades of success are the years of grief and disappointment suffered throughout the service. His biggest drawback was that he was bold and dared to speak his mind. He also did not seek or grant favours and was not prepared to compromise on matters of principals.
There was not much scope for education in Nainital, so he moved to Lucknow where he secured 5th position in U.P. and enrolled for MSc at Allahabad University. He wanted to go for research in Chemistry but half-heartedly appeared for Civil Services. Look at destiny; though he missed one paper due to Typhoid, he was called for the interview. He was non-serious during the interview and had no intention of joining. It didn’t make sense as he was receiving a scholarship of Rs 500 as a researcher whereas starting pay of an ICS officer was Rs 350. Still, he was selected in Indian Revenue Service IRS.
In those days the allied or central services were still in the nascent stages. The Direct Tax Administration Academy at Nagpur had not come up. But since training is a must, he was sent to Calcutta, where an Assistant Commissioner would conduct lectures on office procedure and income tax while a Chartered Accountant gave lectures on bookkeeping. This was all the training.
Pandey’s first posting was Kanpur where one of the first cases he handled was of an assessee who was filing income tax of Rs 5 Lakh whereas the total budget of his charge was Rs 25 Lakh. This assessee was not maintaining any books of account so Pandey asked him to file a total wealth statement. The man kept seeking adjournments and instead offered to pay 2-3 lakhs more like income tax if the officers did not insist on books of accounts or wealth statement. When Pandey did not relent, the assessee tried to meet him at his residence. Pandey politely asked him to meet in the office.
Next day, Pandey got a call from the Commissioner in Lucknow, “Mr Pandey I can transfer you. Why are you doing all this? Why are you troubling him?” On being told that the inspection note was there on the file, he said, “You don’t know this fellow is really close to a particular board member”. Pandey insisted on a written instruction instead of a verbal order and was told, “I will transfer you to Behraich.
“Sir, when I joined, I had given an undertaking to serve in any part of India. You may transfer me anywhere you like”, Pandey replied back.
That was the beginning of career built on pillars of endless punishment postings. Before long transfer orders were on his table. He was being transferred to a less important circle where his jurisdiction was incomes less than 10,000. This was the time when his eldest daughter was 1 year old. “In public perception and in the eyes of my wife I was demoted but I was not perturbed,” he says matter of factly.
Again next year he was transferred to Bareilly… another punishment posting. Here too he got an insignificant ward and many class II officers were given better posts though he was a class I officer.
This went on till a new commissioner – a direct recruit came and was surprised to see Pandey working on a petty post. On being told that this was on the previous Commissioner’s orders, he went back to the headquarters and changed the postings. Pandey found himself posted to a suitable post.
Meanwhile, he had completed 5 years. There is a rule in the Income Tax department that after five years the charge is changed. So he was transferred to Delhi as Principal ITO Company Circle C where he was had jurisdiction over many high profile companies. One of them—The Hindustan Times had not paid advance tax. So Pandey decided to penalize it. The HT representatives produced a letter supposedly written by Pandey’s predecessor but Pandey expressed his inability to accept it as it had no legal value. It was not recorded in the file and besides he was not a hand expert to verify the signature or confirm that his predecessor did sign the file while he was on the chair or later. The matter got referred to Commissioner RN Mattoo a bold officer who went on to be Chairman Direct Taxes and Chairman UPSC. Mattoo asked Pandey to back off, “Press hai..,” he said. Pandey asked him to sign the inspection note. He did. So Pandey cancelled the penalty and marked a copy to Mattoo who smiled and asked, “Was it necessary.” Pandey told him he was doing so only to make sure that it was there on file that whatever he did was on the orders of the commissioner. The matter ended there.
Subsequently, a conflict with one of the Commissioners took such an ugly turn that the matter had to be referred to Chairman of the Board. The Chairman asked the Commissioner to proceed on leave prior to retirement and Pandey saw himself was sent on deputation to defence finance.
Five years later when he joined back as Assistant Commissioner there was a case in which the ITO had imposed a penalty. Pandey endorsed it but allowed the assessee to pay the sum in instalments. The assessee went over his head and approached the commissioner who stayed the demand. Pandey wrote to him that it would have been proper if he had been consulted. The Commissioner felt offended and wrote to the board. Pandey too represented but was transferred.
One of the punishment postings saw him being sent on deputation to RAW which instead proved to be a blessing in disguise and one of the best phases in his life. R N Kao developed a liking for him and retained him as his powerful no2 or Director Establishment, Director Operations and Director Finance. Pandey learnt a lot from Kao who groomed him.
In both his stints at RAW & Defense Finance he learnt many things about administration and man management. One of the things he learnt was not to spoil the ACR of his subordinate unless there was a grave need to do so. Both the organizations followed a practice of showing the ACR to the officer. “I learnt was that subordinate officers too have families to support. You may scold them but you should not spoil their ACR. It helps to know their strength, weakness and family background. You also have to learn to forgive minor mistakes and give credit to your men, to get their loyalty. I had a case where an officer made a mistake. He told me that he made a mistake while using a calculator. I took up his case. He was an honest officer….due for his promotion,” he says.
Pandey also had a way of dealing with corrupt and inefficient officers, “I had an officer who was known to be corrupt. He had three months to go before retirement. I transferred all cases and officers under him. My job was that of an administrator. I was not a reformer like Vivekananda or Mahatma Gandhi”. This philosophy lent itself to a set of rules which he followed even as DG Investigations when a handful of officers were known to be corrupt. He didn’t say anything to them but pretended to be busy and would not give them time. Rule # 2 was not to meet lawyers alone. Rule # 3 as far as possible dictate the order in front of the assessee and his lawyer even the office staff could not play mischief later.
As soon as Indira Gandhi’s government was toppled the Janata regime wanted to teach a lesson to Indira’s men. Pandey was mercilessly shunted out of RAW. He was due for promotion but while his batch mates were promoted he was kept guessing. His posting was changed 3 times in 6 months and he was asked to proceed lock stock and barrel to Mumbai.
Soon enough the Janata Party Government fell and Charan Singh became Prime Minister. For the first time in life, Pandey who was kept without a posting was compelled to ask for help. H N Bahuguna, the then finance minister was known to him from Allahabad, but instead of seeking favour from a politician he decided to approach Kao who brought him to Delhi.
Even after this, there was no respite and his career was pockmarked with obstacles to test his endurance. As an income tax officer, he never wavered while delivering justice to high and mighty adversaries like LM Thapar who was a personal friend of PM Rajiv Gandhi or Mehrasons jewellers against who he raised a demand of Rs 24 crore to be paid in six instalments of 4 crores each.
Today a pacemaker in his heart and diabetes— are the reminders of the turbulent times… the tears he silently shed for no fault of his riding on the roller-coaster journey called life. He has the satisfaction of having lived the good and bad times with his head held high on his chest.
“I am very happy today. But you can’t imagine how much I suffered. I did not make any money even when I was handled unlimited secret service funds in RAW, Director General Investigations or Commissioner Central who decides on the cases of Tatas, Birlas, Dalmas or DCM group. No one dared to touch the DCM group. I did. Par Hua kya… main to Garib ka Garib hi Raha. What did I get out of it?”
Had he succumbed to pressures he would probably be living in a bigger house and would probably fit the definition of a successful person for many of his colleagues and relative… but who knows… Strangely after he was posted out of a place none of the colleagues came to see him off. Instead at the railway station, a man called Bhargava who had tried unsuccessfully to bribe him came up to him and said. “You are an honest officer”
“I said I am being transferred but today have learnt another lesson in honesty. Choti rakam pay neeyat mat girao, badi ko to hajam hi nahin kar sakte (Don’t fall for petty amounts; forget about big amounts because you cannot digest them)”, says Pandey.
When he was without a posting, someone asked, “if you want I can offer few Lakh to the minister and everything will be sorted out. I said you keep away. Even if I become commissioner this way I will not be doing what I want, but doing things you want me to do”.
“For a bold, upright and conscientious officer it is very difficult to work and rise up,” he says. He should because he almost resigned. So for the first time in his life he broke his own rule — had a glass of bear in day time and had the resignation letter in his pocket when he met Finance Minister VP Singh