22 September, 2018

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Chandra Jayaratne Wants Ranil To Act On Perpetual Treasuries

Chandra Jayaratne has requested Prime Minister Ranil Wickremesinghe to make good on commitments articulated to Parliament to take additional steps regarding the Treasury Bond scam in the interest of upholding the Rule of Law, justice and the promotion of anti-corruption action.

Chandra Jayaratne

Jayaratne claims on behalf of ‘the citizens’ that they (the citizens) ‘have noted with great satisfaction’ the commitments made in response to a question raised by the Chief Opposition Whip, which he has detailed as follows:

1. The Government had sought the Attorney General’s advice, as to whether it can take over the Rs. 11 billion lying to the credit of the Perpetual Treasuries Group in frozen accounts, without waiting till the conclusion of the on-going case in the Colombo High Court; which is purportedly more than the loss incurred due to the questionable Treasury Bond issuance

2. The Attorney General and the Police are free to initiate action in the High Court upon the conclusion of the investigation

3. You will ask the Attorney General’s Department and the Bribery Commission to expedite and complete the investigations early;

4. All legal steps have been taken in bring the former Governor back to the Country; and

5. To inform you of anything else that needs to be done:

Jayaratne has requested that the following ‘action steps’ are initiated immediately under the Prime Minister’s personal direction and oversight:

1. Instruct the Commissioner General of Inland Revenue, to initiate a process to assess and recover the following taxes due, along with applicable penalties due thereon, in the event it is determined that any member of the Perpetual Treasuries Group of Companies have willfully avoided and / or failed to return and settle the dues, arising from engaging in business activities and “Acting As a Primary Dealers and or Trading in Government Securities, Bonds etc”, and in respect of profits made there from:

a. Income Tax

b. Financial VAT

c. Deemed Dividend Tax

(Opinions of two leading Tax Experts in above connection is annexed)

2. Insist that the Auditor General or a Competent Auditor selected by the Auditor General, conducts a Forensic Audit and Transfer Pricing Audit on the operations of any member of the Perpetual Treasuries Group of Companies, which engaged in business activities as Primary Dealers, and or Trading in Government Securities, Bonds etc during the financial years 2015 and 2016, and the findings are transparently published and provided to the Attorney Generals Department and the Bribery Commission.

3. Arrange for the Securities and Exchange Commission of Sri Lanka(SEC), as well as any of the Professional Accountancy Bodies who are members of IFAC (including CA Sri Lanka, CIMA Sri Lanka and ACCA Sri Lanka),the Chartered Financial Analysts Sri Lanka, the Bar Association of Sri Lanka, the Directors Institute and any Chambers of Commerce to assess whether any entity or any Director, Officer or Manager or Employee of the Perpetual Treasuries Group of Companies were also concurrently members of the respective Professional bodies/associations and Chambers; and were bound by Codes of Governance, or Professional Codes of Conduct and Ethics; and if so require such Associations, professional bodies and Chambers to carry out a review whether any of their members who were in employment or acted in a professional capacity as Accountants, Mangers, Lawyers, Investment Managers, Auditors, Consultants or Tax Practitioners have violated the binding Professional Codes of Conduct and Ethics and / or any Commitments arising from:

a. Non compliance with Laws and Regulations (NOCLAR) or

b. Any provisions of the Prevention of Money Laundering Act

and if so to compel them to institute relevant disciplinary hearings and impose required sanctions where in default of applicable codes.

He has also opined that Perpetual Treasuries ‘seems to be treating the gain as a capital gain’ and has detailed his views on the matter in order ‘to clarify the legal position’ as follows:

1. It is clear that the fiscal concession conferred in respect of interest received by section 32 (2) of the Inland Revenue Act, No 10 of 2006 (as amended), is confined to a “primary dealer” alone (within the contemplation of the definition of the relevant term phrase as set out in section 217 of the Act) who is engaged in a primary market transaction.

2. The question that arises for consideration is whether a primary dealer who purchases a relevant security, treasury bond or treasury bill issued under the relevant empowering statutes in a primary market transaction and retains such security or instrument until maturity or for more than one day comes within the scope of the tax concession conferred by section 32 (2).

3. The statutory provision makes it explicit that the fiscal concession is confined to a primary dealer engaged in a primary market transaction who holds the relevant security or instrument for no more than one day. It is trite law that a transaction cannot be both a primary market transaction and a secondary market transaction at the same time. It is possible for a transaction to have that status on a consecutive basis but the status cannot be concurrent.

4. The general rule of interpretation is that a statute is to be construed, if possible, so as to give sense and meaning to every part. The maxim expressio unius est exclusion alterius (which means the express mention of one thing implies the exclusion of another) was never more applicable than when applied to the interpretation of this statute.

5. Francis Bennion in his well known work Bennion on Statutory Interpretation [London: Lexis Nexis, 5th edn., 2008], at p. 1259, commenting on the operation of the principle in specific statutory contexts, states as follows:

Uncertainty in one part of a proposition may be resoved by implication from what is said in another part, even though that other part is not directly referring to the first part. Accordingly, account is to be taken of a meaning of one provision in an Act that logically if obliquely arises from what is said elsewhere in the Act. Equally, an express statement in an enactment may carry oblique implications respecting the legal meaning of other Acts, or of unenacted rules of law.

6. P St J Langan (ed) in Maxwell on The Interpretation of Statutes [London: Sweet & Maxwell,

12th edn., 1969], at p. 293, states as follows:

[W]here a statute uses two words or expressions, one of which generally includes the other, the more general term is taken in a sense excluding the less general one; otherwise there would have been little point in using the latter as well as the former.

7. A related linguistic canon of statutory construction is the noscitur a sociis principle. This means that a word or phrase is not to be construed as if it stood alone but in the light of its surroundings. This means in effect that a statutory term is recognised by its associated words.

8. In Bourne v Norwich Crematorium Ltd, [1967] 1 WLR 691, at p. 696, Stamp J expressed the applicableprinciple in the following manner:

English words derive colour from those which surround them. Sentences are not mere collections of words to be taken out of the sentence, defined separately by reference to the dictionary or decided cases, and then put back into the sentence with the meaning which you have assigned to them as separate words …

9. This principle can be illustrated by the manner in which the Financial Services Act 1986 was interpreted in City Index Ltd v Leslie, [1992] QB 98. Schedule 1 paragraph 9 of the Act referred to a contract the purpose of which “is to secure a profit or avoid a loss”. The question arose whether “secure a profit” meant obtain a profit or arrange security for a profit. The court decided the point by reference to a note included in paragraph 9 which disapplied the paragraph “where the profit is to be obtained in a specified manner”.

10. In the instant case what is relevant is the fact that the holding of any relevant security or instrument for a period longer than one day from the date of acquisition by a primary dealer who has acquired such security or other instruments is treated as a secondary market transaction by operation of law.

11. A primary market transaction arises by implication where the relevant instrument or security is held for less than one day because any period in excess of one day would be treated as a secondary market transaction. The inclusion of a situation where a relevant instrument or security is held by a primary dealer for more than one day within the definition of a secondary market transaction by necessary implication excludes this from the scope of a primary market transaction.

12. Where a person is engaged in buying and selling securities and making a profit by way of trade it cannot be argued that the gain constitutes a capital gain (where the test is different). Therefore, an income tax liability will kick in. Furthermore, there is most likely to be a liability for Financial VAT, dividend tax and deemed dividend tax.

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Latest comments

  • 11
    2

    Good work Chandra, but surely you know that the “law is an Ass” in the “Winner Take it All Economy” (check out the book) to benefit Global and Local 1 percent?!

    Ranil Wickramasinghe should have been impeached for the Bondscam, but the day the PCOI Report was published, attacks were unleashed on Muslims to Distract us all and Bond scam Ranil escaped scot free.
    Religion (Buddhism and Islam) has been weaponized by Bondscam Ranil’s foreign backers to set Washington Deep States and IMF_WB-ADB owned and operated by Japan’s political agenda against Chinese in the recently invented Indo-Pacific to further US security and business goals .
    Pl. Read Zambian born Oxford economist Dambisa Moyo’s books on “Dead Aid” and also “Cold War Monks: Buddhism and America’s secret strategy in Southeast Asia” for the roots of the bi-partisan, UNP-SLFP corruption racket that passes for (fake) Democracy and Reconciiation in the Miracle of the Indo-Pacific ! US citizen Gota whose Avant Guard scam was worse than Bond scam is the US-China “Cold War Mandarin” in waiting if US puppet loses next

    • 1
      0

      Don Indeed!
      “Cold War Mandarin: Ngo Diem and Origins of America’s war in Vietnam” by Seth Jacob is a great book to understand the current role of Gotabaya Rajapaksa and his going game to be Sri Lankan President – or Mandarin.
      The book describes how for almost a decade, the tyrannical Ngo Dinh Diem governed South Vietnam as a one-party police state while the U.S. financed his tyranny and later had a coup against him when another puppet was ready. All to stop China’s or communisms advance, but China is capitalist today!
      Gota is accused of Command Responsibility for war crimes, and Trumpland which took Lanka to Geneva has 500 pages on him and could easily try him under US jurisdiction, but he is instead hanging around in Lanka hoping to be President some day! Miracle of Modayas?!!!

      • 2
        0

        MR. CJ , Keep it up!
        Also, please take a look at the insurance sector that is asset stripping Lanka through financialization of social welfare systems and deregulation in IMF-MCC run Sri Lanka today.
        Insurance premiums for Health, Education (and also Transport -cars, vans etc.) are a huge scam.
        Ministry of education has insured all school children who are generally healthy and low risk, although it is Elderly people who need insurance most. This mis-targetted govt. funded insurance scam benefits insurance companies that are sucking out wealth.
        In transport, Insurance Companies are looting us while foreign insurance (AIA, Fairfax) companies have also bough up local companies as Fairfax did Union Assurance, and raised car premiums by 500 percent. They are sucking out the wealth of the country and partly reason for Lanka’s massive debt trap.
        Insurance companies need to be Regulated by the state and monitored. The insurance scams are part of the financialization of social welfare (Health and Education) to benefit the Global 1 percent that has also contributed to Lanka’s huge foreign DEBT TRAP.

  • 9
    0

    Also Killi Maharaja has to be bought from UK and Investigated for fraud.

  • 8
    8

    With all due respect Mr Jayarathna can’t be serious.
    Unless Dr Ranil has been Born Again with different genes.. Or Mr Jayaratna’s Citizens have given Dr Ranil gene therapy..

    The sock answer to all these Questions will be Yhapalanaya is all about non Interference in Law & Order and Legal Matters..
    Besides Aloysious senior has engaged the biggest Gun Lawyers in Colombo asking the highest Yahapalana Court to release all frozen assets of the Aloysious Empire..
    Can Dr Ranil tell SC Boss Dep to defrost them?…

    Who is this Chief opposition Whip?. Because the real deal Opposition Leader has never said anything bad about Dr Ranil or his Royal Buddy Dr Mmahendran or even Junior and Senior Aloysious who are now in the most wealthy league in Colombothurai….

    • 5
      13

      I never thought that I would live to see the day when I would approve of a comment by K A Sumanasekera; but, lo, the day is indeed here.

      • 0
        0

        Please tell us Sinhala_Man: Did you change or has KA Sumanasekera changed?

        • 0
          11

          My attitude to Yahapalanaya has changed, owing to its ineptness. I am likely to still have as little rapport with KA Sumanasekera and the Rajapaksas as earlier..
          .
          I think that while one’s own commitment to basic values must remain, one’s response to unfolding events must depend on evaluating changing scenarios. This is difficult, and I must acknowledge that it is tiring.
          .
          That, perhaps, is what these politicians depend on; it is quite possible that they will win, and we fail. This is why it is so important that we continue to see the woods and not individual trees.

  • 10
    3

    It is pretty clear that there is no legal basis for the State to take over the 11 billion in PTL’s accounts. That is why there is so much foot-dragging. If this could be done, the govt could take anybody’s money claiming it is ill-gotten profit. PTL itself made 4-5 billion when Nivard Cabral was Governor. Is that different ?
    The truth is that there was no scam of the kind being alleged by the Sirasa goons. There was bribery and undue influence. That’s all the charges that will stick. It is not a crime under present law to make profits using a bank loan. If it is, anyone who takes a lease on a car and sells it before maturity at a profit is a criminal.

    • 14
      1

      Raman,
      Absolutely true. Most of the people who comment on this “scam” don’t know what they are talking about, or are just parroting the lies that Sirasa keeps repeating.

  • 7
    1

    Demand action of “RECOVERY” from the “THIEVES’ MOTHER”? (Horage Ammagen Pena Ahannada Hadanne)? For how many years this “Biggest Bank Robbery” (not once but twice) engineered by “BIG FOOTS” has been dragged on? Mark my words. All those “BIG FOOT ENGINEERS” of the ROBBERY would continue to live happily even after the court cases. “You scratch my back and I will scratch your back” principle enshrined in the operational “Democratic System” in Sri Lanka will continue, no matter what.

  • 2
    10

    Took a long time for chandra to wake up.While one watcher is sleeping shoudn’t we have another wide awake or are we to rely on sleeping chandra only.

    • 3
      2

      Shankar,

      I agree with you. Chandra is like GL pappa opening his mouth for the slightest thing now. Press conferences galore. He would have been deaf and blind during MR era when he was in hibernation while huge frauds and murders were taking place.

      • 2
        6

        upali
        can’t blame him for that.If he had opened his mouth during rajapakshe time we would have to call him the late chandra.On perpetual too he had a long sleep.He and all the other watchdogs must bark now for ranil to go.How can you clean up this mess while the master mind is still the UNP leader.Even to give the job to karu as a stop gap leader will do for the moment.At least we know he is clean.

  • 0
    2

    This is stupid legalese worse than Sinhalese. The money constitutes a fraud on the public. It should be simply frozen until guilt can be conclusively established and then pass into public funds. you don’t need to cite a stupid lot of legal books to know that the proceeds of a crime can be frozen by the courts. Better do it fast before the public gets exhausted by these prevarications based on stupidity of legal arguments. Any fool can see that this money does not belong to Perpetual Trustees or to Ranil’s gang of thieves.

  • 1
    3

    What Ranil needs a complete brain transplant to divert his murderous and smart robbery visions into developing the country. I dont know the whether the world is that capable.

  • 9
    1

    Ranil has made a fine art of bluffing the open mouthed idiots of this country with jargon ( liberal democracy , diplomatic protocol, latimer house principles etc etc etc) , economic catch words( FTAs, open bidding, market conditions etc etc) so the Colombo crowd thinks he is an Oxford trained economist ( like Arjun Mahendran Ranil’s twin ) black coats think he is a Law Lord , the humble sarong crowd think he is a gentleman always reading books.

    But the truth is Ranil is a confidence trickster ,like the rest of his notorious family tree.
    The guy wants to ride us till 2030 .

    Wait you rascal for the next election

  • 2
    4

    Who is Chandra J. Where was he during 2005/15 era. Did not open his mouth you know against what. Chandra knows very well what happened to those who opened their mouths.Long live Chandra. We might need your services in future unless he goes underground.

  • 1
    1

    Whether it is Ranil wickrasinghe became big MAFIA boss and emptied the banks, whether it is Mahinda Rajapakse involved via Nivard Cabraal and emptied Treasury, Maithripala sirisena knew it and that is why he is hiding the PCOLI report, Arjun aloesius must have given profits to Maithipala Sririsena as he did during the Ranil’s time, the important think western media of Guardian, AL Jazeera, BBC and Telegraph and their VIYATHUN paid by those groups ormote only the PALHORU #1, PALHORU #2 aND palhoru#3 ONE OF WHICH BECOMES THE PRESIDENT AND PM. IT is certain they will never any one else to come to the stage. Only we know how to run this thing. come and help us. NEws media can publish anything but you won’t get money from us.

  • 1
    0

    Some Viyathun are, I am sure, CIA agents and they want to be parliamentarians next time.

  • 3
    0

    Bonds scam is not the first and the last scam to our country. In 2008, the whold world collapsed after Banking collapse in USA due to a scam. It took several years to big nations to recover from that collapse. In Srilanka, the war between LTTE and Srilanka used as an opportunity by all politicians and Businessmen to rob this nation freely under Mahinda regime and this continued under this government. Both previous regime and current regime is responsible this situation. There is no law and order. Former President Mahinda Rajapakse, Current President Sirisena, Current Prime Minister Ranil should take full responsibilty and they should be punished under the law and all the civil rights should be removed. The country need a leader who is clean and strong to meet the challenges that are barriers to implement the law and order.

  • 3
    0

    [Edited out] I think the next step in the bond scam is acquitting the thieves. Arjun Mahendranis safe now. Ravi KArunanayake to be appointed Cabinet minister again. Next just after the elelction eith er the president Maithripala Sirisena or PResdient one of the Rajapakses will acquit Aloesius. who knows they may be paid comphensation too. That is the democratic Sri lanka where we elelct the same thieves and financial frauds and fradulent financial firms too involve in Sri lanka’s Development. Say Hail HItler to the parliament.

  • 0
    0

    New King wants the drug offenders hanged. In Chandra’s government, his peoples are accused of signed the customs papers to release illegal drug to be brought in. It is double crime, destroying the Law and Order at the Customs level, and then bringing in drugs. If Chandra demands Ranil to take action on those criminals, they have to be hanged. But Chandra is silent on that because he does not to run his relative into trouble.
    Even comments in this essay, comments are suggesting that Ranil is master mind of the crime. But, Chandra wants the man Ranil employed in for a year on contract to do this job to be skinned. It is said Mahendran suppressed the Old Royal time crimes get investigated as favor to Old Royals. PTL was owned by Aloysius. The company was plugged out of his hand for the favor of him saving Yahapalanaya not going bankrupt on the first month (February 2015) itself. Because Chandra’s father was the PM, how many jobs Chandra resigned for the reason of conflict of interest? How many shares sold out that he was holding in companies? Isn’t Chandra’s Old Royal Government robs the Lankawe and run it to wreck? He is demanding that the professional bodies have to investigate misconduct of the PTL employees and deprive them the membership. What does he understand of professional ethics? When somebody did substitute a professional body to Ranil’s F word CIDs?
    Now he is telling PTL employees memberships should be cancelled.
    The pathetic idiot didn’t know yet that from the time they messed Soulbury’s flawed constitution, they couldn’t create something can be called a constitution. There is no legitimate President in the country because of the Sinhala lawyers messed up the 19A.
    Because Aloysius is Tamil, Chandra is picking on his family. Chandra is a Puluththa(worm crawling) racist, it seems.

  • 3
    4

    Dear Mr. Jayaratne,

    I have my due respect to you as a Chartered Accountant.

    But your request is like asking who is the theif from the thief’s mother (Horage Ammagen Pena Aheema).

    If this fraud happend in a developed country like Australia and USA, these Central Bank bond horu and the MPs who took money from Alociaus would be in Jail within 6 months. This includes the PM as well. Becuase he is the main alleged person in this case. Becuase he brought Arjuna. He tried to cover up this case. He tried to appoint Arjuna second time as the Governor. Then Arjuna worked as an Advisor for PM’s Ministry after his removal as the Governor. What else you need to charge this man.

    Yahapalanaya sapada? In Sri lanka Police is extremely efficient in arresting an old woman for stealing some nagoes in Anuradhapura. I also heard that a school girl was arrested by police for alleaged stealing of 3 coconuts. This is histroy.

    I also noted that you are a member of the Institute of Chartered Accountants of Sri Lanka (ICASL) . I noted that this PM was invited as the Chief Guest by the ICASL recently for a corporate event. Then why did you keep quiet. You should have protested as a Senior Member of the ICASL. That is a disgusting invitation given by the ICASL as a professional organiation to safe guard the tranpernace and accountability.

  • 0
    1

    {“Chandra Jayaratne Wants Ranil To Act On Perpetual Treasuries”}
    But but but Chandra, the bond issue is still an allegation.
    We support you because action on one allegation may lead to action on the long delayed ones.
    PS: The teams in the home vs home finals may bury the hatchet!

  • 0
    0

    I am amazed. When litigation becomes a chronic sicknees, it only requires a Goon to file for legal redress to ensure the bluff of ” postponement or long “Dates” The tardiness of the Legal system in taking action enables the excuse of “Sub Judice” to thwart progress. A little bit of “Dutarteism” may be in order.Why not sieze the Assets of all scoundrels and leave it to them to seek release upon proving their innocence? A modicum of positive action is in accord with commonsense, even if not in legalese? This is a way to preclude passing the ball until a new Government will ensure that the whole thing is swept under the carpet – provided a political President would not have already given a “Presidential Pardon” and we can all live happily ever after.

    “Nettle Grub”

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