My dear Ram
Your story sounds too familiar and so, I know its genuine.
I have more than 20 years of experience in HRM; yet I shall not advise you about "changing/reforming" the boss, the owner of a private limited company.
Human nature is the most difficult thing to change (though, not impossible); considering it is a product of personality (which again is too complex), attitude, belief, behaviour etc.
Owners of private limited companies, behave exactly the way you have written. they are the "maliks" and people who get salary from him are 'slaves'. They do not have any respect even for the labour laws of the country. They can buy the officials and politicians, so they go along their way merrily, without the least concern for people like you.
You can flourish and grow fast under such dictatorship, if you say "yes, boss" with every sentence, praise them sky high and are willing in general, to 'lick their boots'.
But my assessment of you indicate that you are an upright, a real "human" resource manager. Else, you would not have felt uncomfortable with such a situation.
Dear friend, I have only one suggestion - do your best to move off as fast as you can. You can handle the Interview. Tell the truth, without sounding harsh or bitter; just that "I feel I can not give my best under such restraining, un-healthy working environment."
Be confident, if it is a good company; they will definitely hire you;
if it is a bad company; then let them not hire you - because you are already in one.
Warm regards.