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million. The Indian ambassador initiated enquiries and when he came to know

              the actual position in this regard, he was sorry for the apathetic attitude adopted
              by him towards Mr. Modi. The British Government also then gave him due hon-

              our but expressed its inability to secure the machinery required for the textile
              mill. Mr. Modi, therefore, left for America and succeeded in securing the neces-

              sary machinery from there.


              Many industrialists had earned huge amounts of profit during World War II.
              Therefore, the new government at the Centre set up an Inquiry Board to go into

              the financial conditions of the industries established during this period and to
              detect tax evasion, if any. The Board started enquiries and tax assessment pro-

              ceedings were initiated against a number of businessmen. As an industrialist
              who had undertaken huge expansion of industries during that period, Mr. Modi

              also came under the purview of this inquiry. He was already facing the prob-
              lems of importing textile machinery from abroad, and mobilising the remaining

              amount of share money from the share-holders, and now he was faced with the
              third problem of tax assessment. His financial advisers counselled him to drop

              the idea of setting up the proposed textile mill, but he refused to listen to them.
              He was of the opinion that for an industrialist maintaining the public image was

              more important than facing an enquiry and, possibly, losing some money as a
              result of tax assessment. He was, therefore, determined to go ahead with his

              project.

              In 1948 Modi Hosiery Factory and Modi Tent Factory were started. In the same

              year Modi High School was converted into Modi Science & Commerce College.


              It had been estimated that about 2,000 workers would be needed for the new
              textile factory. There was also the problem of rehabilitating the refugees from

              Pakistan. He, therefore, thought it proper to establish a new colony for the refu-
              gees at Modinagar. Mr. Govind Ballabh Pant was then the Chief Minister of Uttar

              Pradesh. Mr. Modi placed his project before him and gave the undertaking that if
              he was granted a Joan to establish the new colony, he would return with interest

              every rupee loaned to him by the Government. He also wanted permission to
              establish a few cottage industries for the benefit of the refugees. The U.P. Gov-

              ernment gave him the necessary permission to go ahead with the project.







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