CA Online

Amid a raging debate on the sedition law, President Pranab Mukherjee on Friday said the Indian Penal Code ( IPC) requires a thorough revision to meet the needs of the 21st century and changes are necessary in the “ archaic” police system. “The IPC has undergone very few changes in the last 155 years. Very few crimes have been added to the initial list of crimes and declared punishable,” he said at the valedictory event on the occasion of the year- long celebrations of the 155th anniversary of IPC here. “Even now, there are offences in the code which were enacted by the British to meet their colonial needs. Yet, there are many new offences which have to be properly defined and incorporated in the code,” he said. The premier code for criminal law was a model piece of legislation but requires a “ thorough revision to meet the changing needs of the 21st century”, he said. In the light of the sedition law being applied on Jawaharlal Nehru University students for allegedly raising ...

The Economic Survey indicated that the Reserve Bank of India ( RBI) could be behind the curve in rate cuts and the policy stance was actually “ neutral” rather than “ accommodative”, as the central bank claimed. “There is scope for easing monetary policy in two ways, one to inject liquidity to bring it in line with the current policy rate and second is given our inflation projections and assessment going forward, perhaps there is more scope for easing the policy rates as well,” he said. RBI should be able to meet its inflation target of five per cent by March 2017, the Survey said. “ Indeed, with the current stance, there is apossibility of undershooting. While the current policy rate seems ‘ neutral’ in that it is only modestly higher than consumer price inflation, liquidity conditions are unusually tight, impeding the pass- through of recent declines in policy rates to the actual bank rates faced by borrowers.” While banks have time and again complained about the tight liquidit...

After the governments Economic Survey for 2015- 16 hinted at higher taxes on gold, analysts are ruling out a cut on its import duty in the coming budget. Instead, a smaller excise duty, perhaps around two per cent, on jewellery manufacturing looks possible. The Survey has a full chapter on commodities it says are highly subsidised. Gold is one and it says this is a strong demerit good, as 80 per cent is consumed by the top 20 per cent among income earners, while it is taxed at 1- 1.6 per cent, compared with about 26 per cent for normal goods ( the central government’s excise tax on gold is zero, compared with 12.5 per cent for normal commodities.) This is seen as a hint for increase in taxes on gold. “ A hike in customs duty will be a difficult call due to various other social risks attached to it, and instead an excise duty of two per cent seems the most probable event. Thus, add two per cent to the 10 per cent customs duty and other state and central taxes of 1- 1.6 per cent, and...

FMCG, automobile industries say if GST regime kicks in, rail hubs can take Make in India to a new high As Railway Budget 2016 promised focus on freight corridors and Railway Board Chairman A K Mittal revealed the strategy to tap sectors like fast- moving consumer goods (FMCG) and automobiles to increase traffic, the success of the ambitious plan hinges on the goods and services (GST) tax regime. If freight corridors become reality as promised, FMCG sector could cut down expenses and streamline operations. The inventoryheavy industry, in which logistical efficiency and warehousing play a significant role, will be able to shift towards centralised production at cheaper rates. Currently, Indian Railways transport only 1,000 million tonnes of FMCG products every year. While a few majors such as Nestle and milk co- operatives use the railways for supply of raw materials and dispatching finished goods from the factories, a majority of the players depend heavily on road transport. ...

Pitching for a major over haul in the tax regime, the Economic Survey said India needs to increase its taxto-GDP ratio while spending more on health and education. The report flagged steps to broaden India’s narrow tax base, arguing that 20% of individuals should pay tax on their earnings compared to just 5.5% now. The easiest way to do this would be to not raise thresholds on tax breaks, and review and phase out such exemptions. The survey called for higher property tax rates to check speculation in real estate, along with “a reasonable taxation on the betteroff individuals in the country” irrespective of their sources of income — industry, services, real estate and agriculture. The survey expressed “disappointment” over the delay in the passage of the Goods and Services Tax (GST) bill, saying that once implemented, GST will usher in “unprecedented reform” in modern global tax history. “India’s overall tax-to-GDP is about 5.4 percentage points less than that of comparable co...

New bankruptcy law, kick-starting stalled projects, JAM to help address challenges Equating the Indian economy in the 21st century to the ‘Chakravyuha’ legend of the Mahabharata — which Abhimanyu could enter but not exit — in the opening chapter of the Economic Survey for 2015-16, the government on Friday cautioned that the country is facing adverse consequences due to the lack of a way out for failed ventures. The Survey, tabled in Parliament by finance minister Arun Jaitley on Friday, said the government is looking to facilitate exit through a host of initiatives, including the new bankruptcy law, rehabilitation of stalled projects, proposed changes to the Prevention of Corruption Act as well as the broader JAM (Jan Dhan, Aadhaar and Mobile governance) agenda. “The Chakravyuha legend from the Mahabharata describes the ability to enter but not exit, with seriously adverse consequences. It is a metaphor for the workings of the Indian economy in the 21st century, the legacy of s...

Retirement fund body EPFO has tightened the norms on withdrawal of provident fund and its investment in Varishtha Pension Bima Yojana for its over 50 million subscribers. “Now, subscribers won’t be able to claim withdrawal of their PF after attaining the age of 54. They will have to wait till they are 57. The ministry has notified new rules,” a senior official said. Under earlier rules, Employees’ Provident Fund Organisation subscribers could claim 90% of the accumulation in their PF account at the age of 54 and their claims were settled just one year before retirement. The official said the earlier clause was relevant when establishments had a retirement age of 55 or 56 years. “But in today’s scenario, when retirement age is 58 years across organisations, the clause is not relevant. But the big change is that now, under this facility, the subscriber will be able to withdraw his contribution and the interest earned on it, unlike 90% of the total accumulation earlier,” he explai...

www.caonline.in News... 1.Mutual Funds to trace owner of unclaimed redemption & dividend amounts. Circular No. SEBI/HO/IMD/DF2/CIR/P/2016/37 -(25/02/2016) 2.Single Window Project-Problems in clearance of Ex-Bond Bills of entry in online clearance facility.F.No.450/147/2015-CUS-IV -(26/02/2016) 3.MVAT: Changes in automation processes & other procedures. Trade Circular No. 7T of 2016 -(25/02/2016) 4.CBDT Mechanism to Identify of Duplicate PANs. ITBA-PAN Instruction No. 3 - (24/02/2016) 5.Reopening on incoherent reasons not valid u/s 147. [Sabharwal Properties Industries Pvt. Ltd. vs. ITO (Delhi High Court)]. 6.Expenses not generating capital asset are revenue in nature. [CIT vs. M/s Manganese Ore India Limited (Bombay High Court)]. 7.Business set up expenses deductible despite of no business income. [Multi Act Realty Enterprises Pvt. Ltd vs. ACIT (ITAT Mumbai)]. 8.Extension of due date to file returns in form GE-II for 1st three quarters of F.Y.2015-16 to 07.03.2016. No...