Jaya demands Finance Minister's resignation

Chennai, May 22: AIADMK General Secretary and former Tamil Nadu Chief Minister J Jayalalithaa today demanded the resignation of Union Finance Minister P Chidambaram, owning moral responsibility for the stock market crash.

In a statement here, she alleged that the 'reckless and careless' attitude of Mr Chidambaram and his 'inept' handling of the situation had resulted in heavy losses of between Rs 5,00,000 crore to 10,00,000 crore for small investors.

Appealing to Prime Minister Manmohan Singh to direct state-owned institutions to step in and prevent further damage, she said independent investigation into the 'suspicious crash' should also be conducted by an independent authority or a parliamentary panel.

'It is shocking that this crash is attributed to a draft circular of the Income Tax Department, proposing to tax profits on dealings in shares of Foreign Institutional Investors (FIIs) as Business Income at tax rates of 40 per cent,' Miss Jayalalitha said.

She said the Union Finance Minister and Income Tax department were primarily responsible for 'this blood path in the stock market.'

Ms Jayalalithaa said whenever concerns were expressed about the rising sensex, Mr Chidambaram had justified the roller coaster ride by attributing it to the strong fundamentals of the economy and had repeatedly reassured the investing public. If a mere draft circular could trigger a crash resulting in huge loss, it was clear that both the Union Minister and the stock market watchdog SEBI had miserably failed in their duties, she charged.

It was widely perceived that the crash had been 'engineered' by vested interests, enormously benefiting a group of unscrupulous operators, pushing millions of hapless retail investors into an abyss, she claimed.

Calling for a thorough investigation into the crash, she said it would be possible only if the incumbent Union Finance Minister resigned, owning moral responsibility for the 'calamity.' The former Chief Minister said it had also been alleged that the Union Minister was toeing the American investors' directives. The FIIs, which had been trading in the Indian Stock Market and making huge gains, had been kept outside the purview of tax liability.

Strangely enough, the FIIs had all been classified as 'investors' and not 'traders' so that they did not incur any tax liability, she said and added that 'this is another reason why Mr Chidambaram should quit as the classification of investors and traders had been contrived by him at the behest of US fund managers.' Pointing out that the Stock Markets had continued their crash and the Exchange had to be halted after a stupendous crash of 1,100 points, the AIADMK supremo alleged all these had occurred only because of the 'reckless and careless' attitude of Mr Chidambaram.

UNI

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