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Hasmukh Adhia, Modi’s man who knows too much

Adhia is a topper in accountancy from Ahmedabad’s H.R. College and a gold medallist from IIM Ahmedabad

By Jayanta Roy Chowdhury in New Delhi
  • Published 18.11.18, 3:08 AM
  • Updated 18.11.18, 3:08 AM
  • 2 mins read
Hasmukh Adhia Telegraph file picture

Some colleagues of Hasmukh Adhia, who is scheduled to retire on November 30 as finance secretary, believe the Prime Minister may have indicated his displeasure with the senior official for messing up the implementation of the GST scheme.

Criticism against Adhia has mounted because of a GST revenue shortfall, estimated at Rs 50,000 crore at the end of October, and rising anguish within the business community against the frequent changes in the rates and compliance procedures, as well as tardy refunds.

Adhia faced the rap because small businessmen and traders — considered part of the BJP’s core voter base — have been deeply upset at the way in which they were brought within the tax net with the implementation of the GST.

Sources said BJP surveys had warned Modi of the anger building up among the traders and small businessmen, hit by the double whammy of the demonetisation and a chaotically implemented GST, especially in northern and western India.

But his ministry colleagues believe Adhia will secure a post-retirement sinecure. “He has worked with Modi for two decades and is a man who knows too much about this government,” a colleague said. Some speculate that Adhia may even be accommodated in the PMO.

Although he was technically part of Jaitley’s core team, it was well known that Adhia enjoyed a direct rapport with Modi, with whom he conversed in their native Gujarati.

The 1981-batch IAS officer, who prefers to wear a “Modi jacket” like his boss and sports an unkempt beard that is similar but not exactly like the Prime Minister’s, is believed to have been a supervisor of the “backroom” planning for controversial moves like the demonetisation and the hasty implementation of the GST.

Adhia is a topper in accountancy from Ahmedabad’s H.R. College and a gold medallist from IIM Ahmedabad, besides being a doctorate in yoga from the Swamy Vivekananda Yoga University, Bangalore.

Officials said that besides the failure of the GST, some other issues had robbed Adhia of his sheen. First, diamantaire Nirav Modi fled India after defrauding the state-run Punjab National Bank out of Rs 14,000 crore — a scam that left Adhia and the ED red-faced.

Soon afterwards, there were reports that Adhia had in 2016 received two gold biscuits, a silver coin and an iPhone7 from unknown people, which were collectively worth Rs 1.74 lakh. On the advice of the cabinet secretary, Adhia had on November 8 that year handed the Diwali gifts over to the “toshakhana” run by the foreign ministry, where public servants have to deposit all the gifts they receive from foreign governments that are worth more than a token sum.

The third was the government’s reversal of Adhia’s decision to continue with the UPA’s choice of a private entity, GSTN, as the repository of sensitive tax data.

GSTN was registered as a Chapter 8, non-profit company with 51 per cent shareholding in the hands of banks like ICICI and HDFC. Its main job is to provide the technological backbone for the collection of taxes and filing of returns in the new indirect tax regime.

However, following data leaks from the Aadhaar portal, reports of how Cambridge Analytica had manipulated Facebook data and strident criticism from maverick BJP politician Subramanian Swamy, the government decided to reverse Adhia’s decision and nationalised the firm.

This was seen as a clear indication that Adhia was no longer the “golden boy”. 

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