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On Meaning and Swadharma

Rishi AgarwalLeave a comment

I finished Jordan Peterson’s book 12 Rules for Life and I enjoyed reading a good book after a long time. Jordan B. Peterson (JBP) has given 12 rules that you should follow in life that are can help you to avoid chaos in life. The opposite of chaos meaning order. Being a clinical psychologist himself, he has given examples of his practice and also shed light on the rules through examples from Bible and some Egyptian mythology.

I am a particular fan of ancient wisdom because ancient wisdom is many times very simple and clear. They don’t bother with many rules and as JBP said in the introduction, ancient wisdom was based on action (and experience) and not particularly things and world.

Out of the many rules that he wrote in the book, I liked the 7th Rule – Pursue what is meaning (not what is expedient). Def of expedient – ‘a means of attaining an end, especially one that is convenient but possibly improper or immoral’. JBP says that it is important to sacrifice, have delayed gratification in what you do and pursue what is meaningful, rather than going for something that is beneficial in the short term and seems convenient to you.

Comparing the terms to Bhagavagad Gita, meaningful is similar to Swadharma of Hindu philosophy, and sacrifice is Yagna while expedience would be ‘Sankalpa’ or ‘Aarambhaa’. JBP says

“To have meaning in your life is better than to have what you want, because you may neither know what you want, nor what you truly need. Meaning is something that comes upon you, of its own accord. You cannot simply produce it as an act of will. Meaning signifies that you are in the right place at the right time properly balanced between order and chaos, where everything lines up as best it can at that moment”

12 Rules for life – Jordan B. Peterson.

Nothing could describe more accurately about the situation of Arjuna, the great warrior of Mahabharata who wanted to leave the battlefield, when two armies signifying good and evil, order and chaos, were facing each other at Kurukshetra. It is then that he wished to leave the field as he thought that he is bringing chaos to the world through his actions of killing others. Then Lord Krishna, urges Arjuna, to discard his ambitions of becoming a monk. Arjuna was trained as a warrior all his life and most important battle of humanity, he wanted to drop his weapon and go away to the forest. Krishna offers him the way of Naishkarma Siddhi – work according to your purpose or meaning, act on what is meaningful, offer the fruits of those actions to Him (Brahman). Through this he will be able to attain success in his work and also attain Nirvana or Oneness with Brahman.

To do what is meaningful, JBP says that we have to sacrifice now, to gain later. Sacrifice or Yagna is the basis of action in Hindu philosophy too. According to Hinduism, everything in the world is based on sacrifice, even the cycle of rains and crops is a sacrifice. Nature sacrifices. Each person sacrifices something. A person who lives only for himself and does not offer anything to the world, its better that he is dead. After reading 12 Rules for life, I think what it means that a person who does not offer anything in sacrifice is almost like a dead person as he has not improved his character and Being.

From the book, Tao te Ching has this:
He who contrives defeats his purpose;
and he who is grasping, loses.
The sage does not contrive to win,
and therefore is not defeated;
he is not grasping, so does not lose.

12 Rules for Life, Jordan B Peterson

In Bhagavad Gita, Krishna repeatedly tells Arjuna not to start any work based on Sankalpa. Sankalpa would mean planning or intent. This has always confused me because I have always started something first by planning about it. But like Tao te Ching says, planning and contriving defeats the purpose. You lose meaning of yourself and the task. You want to complete the job at all cost. You fail to live in the moment. Not that planning is not important in the completion of a project. But many times we often stick to the plan and the results and not the meaning of the project. The way out is to sacrifice the result at the moment. Whatever aim you have, you carry out the task and forget the result. The focus should be on the task only and not the result. This helps to clean your soul itself in the long run and like JBP says allow you to have meaning and aim higher and higher.

Articles

The power of middle class

Rishi AgarwalLeave a comment

Mahatma Gandhi mentions in his autobiography that the middle class in India has the power to change the tides and they can easily follow the diet and suggestions that he was making in the book. Gandhiji’s diet suggestions and other suggestions to live a healthy and devotional life could look stringent to many but can be easily followed especially the middle class. He says that the rich are too indulged in their senses and hence they cannot follow the lifestyle suggested by him. And the poor live hand to mouth and always worry if they can live and get by another day. So even poor cannot be expected to follow his advise. But middle class has decent means and they can be persuaded to live a healthy and spiritual life.

 

I see this in many other ways too. Today the rich class is very oblivious to the plight of the poor and have no clue what worries the poor on a daily basis, what troubles their mind, what problems they want to see solved on priority. And the gap between the rich and poor is increasing annually with the poor having no idea what goes in within the castles of the rich. It is only the middle class who might have a fair idea of what the poor class goes through. And the middle class also has an inclination to what it means to be rich because today the middle class aspires to be rich soon. But it is this power of middle class to be in-between that can be an advantage to them. They could try to live a more healthier and spiritual life than trying to advance materially whole year. They are already devotional and  can additionally try to  control their senses and observe fast once a week or twice a month. They can teach their kids what is more important in life and not to forget the society at large if they ever become rich. Good habits formed while living in the middle class stage can be followed through when they become rich. Compared to the poor, the middle class are at a better position to use their intellectual faculty for the benefit of their neighbors and society. They can be more alert to the workings of the government and can raise important points to them. We often see that the poor are more emotional, hence the middle class can  bring their logical mind to the systems of the society.

 

But all these expectations from the middle class go unfulfilled because,  most importantly, today, they are in a continuous rat race trying to outdo one another to reach the top. They hate their middle class position and want to exit this stage and reach the higher class.  If citizens from middle class realize that they should work together as a whole like poor do, they can bring important change in the society.

 

 

Articles

Proprietorship, Partnership, LLP, OPC, Private Limited – What should I choose to start my business

Rishi AgarwalLeave a comment

Many people starting their business for the first time are always in a dilemma on what option to choose to start their business in India – Proprietorship, partnership, Private Limited, Limited Liability Partnership or One-Person Company (OPC). I will share my views on these based on close experience of starting and running these forms of entities.

The factors that you should consider while choosing these options are:

  • Number of people managing the business
  • Number of investors in the business
  • Starting procedure
  • Income tax calculation
  • Statutory compliance & Auditor fee
  • Book of accounts
  • Exit strategy (very important)
  • Asset allocation
  • Liability

 

  1. Proprietorship – If you are a single individual who wants to start his own business, consultancy, freelancing, then this is the most simplest form of starting a business and easiest to maintain. You start a proprietorship simply by opening a current account in the bank. You don’t need a separate PAN card and basically the business entity – proprietorship – is the same as you. Since it doesn’t need a separate PAN, accounting is easier and you can choose to not maintain book of accounts while filing returns, which means that  annual returns of you and the business entity could be calculated based on a small percentage of annual income. This option is given in India as lot of small shop owners don’t maintain a book of records, but I have seen many small industrial setups too choosing this option. It also has the least statutory compliance. And if you ever you want to exit the business, you only need to close the bank account. But the liability is also maximum in this type, which means, if ever you owe money to your lenders or employees or government and you are not able to pay them, then your personal assets can also get involved to recover the dues. So choose this type depending on the risk taking ability of your business. If you are opening a consultancy or freelancing, you could start a proprietorship. But if you are starting a factory, you probably should think more about this option. Also, in case your death occurs, the business ceases to exist and all assets (including bank accounts) are now in the hands of your legal heirs.
  2. Partnership – This option can be used for 2 or more person wanting to start a business.  Personally, I wouldn’t recommend this option to anyone, especially with the LLP option now available in India. Partnership means unlimited liability for the partners. Partnership works if you are a group of lawyers, advocates, accountants or doctors coming together to provide a consultancy service. Or it might work if you are  a husband-wife couple in the business. Otherwise it is a risky option. I will give some of my reasons for this. First, to start a partnership you need to register a deed of partnership with a the Registrar of Firms. The deed of partnership can contain any clauses that you wish to enlist. It doesn’t cost much to register this deed. Then you need a separate PAN Card for the firm. Then you open a bank account.  You then maintain a book of accounts for the firm. But here is when things go different – while calculation income tax, the income tax slabs available to companies and individuals are not applicable to partnership firms. Partnership firms have to pay a flat tax rate of 30% and the remuneration provided to partners, which forms the major part of expenses in PnL,  has some restrictions. Also, presumptive taxation is allowed here   as available in Proprietorship. Partnership  firm is like proprietorship when it comes to liabilities, all partners are liable to pay the dues personally. Basically partnership firm is not a separate legal entity in the eyes of the law. The firm is the partners, whereas in Private Limited, the company is a separate legal entity. The only advantage of starting a partnership firm is that you can exit it easily, or stop the firm easily. Any partner can one day decide that the firm should shut down and the firm might cease to exist, depending on the Deed of partnership registered.
  3. Private Limited – This is the third and most popular option today and the government is trying hard to make the process easier. I have been running a private limited for quite sometime and now when my friends and acquaintances ask me about it, I advise them not to go for this. The major reason for that is the exit option. It is extremely hard and next to impossible to shut down a private limited company. Say you are two friends who want to start a startup and are excited to do business and if everything goes right, you will make millions. But if anything goes wrong and you want to shut down or quit, you can’t. It means  you will have to keep the company alive,  pay your CA some amount every year just to file  NIL returns annually and observe the statutory compliance. Indian government has recently brought the Bankruptcy law but things will be clear only after 3-4 years. Another negative aspect of Pvt Ltd is the increasing number of statutory compliance. Just in past 2 years, 2 compulsory forms have to be filed through digital signature by the directors, failing which the company will be rendered inactive or default. You need to understand that private limited was made to protect the rights of the investors. In Pvt Ltd, you have a separate legal entity, each director has to obtain a DIN,  the liability is not unlimited like partnership, so directors are not liable personally in case there are any dues to vendors, government, employees. Investors get shares and if the company does bad, the share money is lost. Hence the laws governing private limited are very stringent even now to protect money of all the people who come in contact with the business. But there are advantages too – income tax calculation is simple, separate tax slabs for companies, director salary is treated just like any other employee salary for the purpose of tax calculation,  the procedure to start a pvt ltd has come down considerably from past decade, even if one director exits or passes away, the company continues to stay, assets belong to company and  not to individuals as in case of proprietorship and partnership. I would recommend this option if you have other investors, apart from friends & family,  in your business. This option is similar to the Inc. option in USA.
  4. One Person Company – This is the most recent option available in India and is basically a private limited but with only one person. Private Limited required atleast 2 people and this option – OPC – allows a single individual to start a company too. As of now (2020) I would prefer to go for proprietorship than  a OPC, because the rules are not yet clear in all departments – Income tax, State departments etc. I am not yet sure what the exit options are to close the One Person Company.
  5. Limited Liability Partnership – LLP – This option was made available since 2012 and I hope the rules and laws regarding LLP are now clear. As it says, it is a limited liability which makes it the best option to start  small venture. You get the benefits of a partnership firm and also have limited liability like Pvt Ltd. This option is similar to the LLC available in USA. Partners still need to get  a DIN and get their firm registered with the Registrar. But presumptive taxation is not allowed in LLP. Since it’s been 8 years, it remains to be seen how many businesses have opted to close down the LLP and what the experience has been so far.

Overall, I would suggest to keep things simple when starting a business. Always have a goal in mind and be optimistic about your path, but also think of exit options if things don’t go well. You can choose any option first while starting a business and then after 2-3 years you could shift or convert to another type when situation changes. CAs and CS will do that for you. For example, you are an individual who wants to do consulting, then start a proprietorship now and then later go for the OPC if you think you need more investors for your business. If tomorrow you want to bring additional working partners then stop your proprietorship, start a partnership or LLP. Or if you are a group of friends who want to try a startup, then make a LLP now and then go for private limited later only when you need funding from investors. Knowing what works for you is also a part of the business journey.