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Showing posts from June 3, 2016

Black money: IT dept notifies declaration forms

The Income Tax department notified four new forms for those who wish to declare their untaxed funds and properties under the one-time domestic black money compliance window. The forms- 1, 2, 3 and 4 can be used both for e-filing or manual filing of the black money assets by a declarant under the Income Declaration Scheme (IDS). "In Form 1 the details of assets to be declared under the IDS is to be provided, Form 2 is the acknowledgement for the same that will be issued by the jurisdictional Principal Commissioner of Income Tax to such a person. Form 3 and 4 pertain to payment of taxes and penalty on these funds," a senior IT official said. Business Standard New Delhi, 03 June 2016

Push by Sebi gets MF scheme mergers rolling

The Securities and Exchange Board of India ( Sebi)’ s insistence that mutual funds cut down on the number of schemes they manage is beginning to yield results, but the scope for merging plans still remains large. In the first five months of this calendar year, more than 30 schemes have been merged, compared with almost half that number in the whole of 2015, according to Value Research. From 2010 till now, roughly 150 schemes have been merged. At present, the mutual fund industry has roughly 350 equity schemes and 1,500 debt schemes. “There is a scope for more mergers across all categories, whether debt or equity,” said Manoj Nagpal, chief executive officer, Outlook Asia Capital. “Several fund houses have paid a price for acquiring schemes from other fund houses during mergers, with a view to boost assets and valuations. That is the main reason why they are reluctant to cut down on schemes,” added asenior fund manager on condition of anonymity. Experts said the older and lar

RBI wants overhaul of cyber security in banks

The Reserve Bank of India ( RBI) on Thursday directed banks tochal kout cyber security policies, separate from the lenders’ IT policy, “ immediately” in view of the rising cybercrimes at banks. In its cyber security framework for banks, the central bank said the number, frequency and impact of cyberattacks “ have increased manifold in the recent past” at banks and other financial institutions, “ underlining the urgent need to put in place a robust cyber security/ resilience framework at banks and to ensure adequate cyber- security preparedness among banks on a continuous basis.” The circular comes a week after RBI Deputy Governor S S Mundra said at an event that the central bank would get strict with cyber security flaws at banks and was considering to limit a customer’s liability in case of cyber fraud. The framework, posted on RBI’s website, warned that banks must improve the current defences in addressing cyber risks as entry barriers are getting lowered, while motivation and

Public sector banks delay plans to raise capital

Public sector banks ( PSBs), which are starved for equity capital, are refusing to tap the markets to raise funds, despite having all the necessary approvals in place. State Bank of India ( SBI), Bank of India, United Bank, Oriental Bank of Commerce, Union Bank and IDBI Bank have had the permissions for more than a year or more but they have refrained from raising capital via the qualified institutional placement (QIP) route. Arun Tiwari, chairman and managing director of Union Bank, points out that even though they have the approvals to raise ? 1,386 crore via QIP, they haven’t done it as yet because they do not need the funds now. “The credit growth in the system has been low and the areas that we are growing in don’t require as much capital. Therefore, the need for capitalraising hasn’t come yet,” he said. The credit growth in the banking systemhas been in the range of 8.5- 11 per cent for almost two financial years now. And the PSBs, excluding SBI, seem to be the worst affect

Decision- making enters a difficult zone

There is almost full consensus that the Reserve Bank of India ( RBI) is unlikely to lower the repo interest rate in June, especially after signalling in the last policy that it would keenly monitor liquidity dynamics and infuse “ primary liquidity” to support its accommodative stance. Further out, the market remains hopeful that RBI could deliver a last 25- basis point repo cut around August, post clarity on monsoons. Though not a zero probability yet, scope for RBI to implement more repo cuts is shrinking at a fast pace and this could be irrespective of the monsoon dynamics. While headline Consumer Price Index (CPI)- based inflation increased to 5.4 per cent in April, the cereals inflation that should mostly get affected by the monsoon is not too significant even today and is at around 2.5 per cent. Vegetables and pulses prices have been volatile and might continue to be so in the near future. Beyond the food prices, the key issue that is not easily ignorable is the firm to firm

Central, state tax officials at loggerheads over GST

As the government struggles to get the Opposition on board for the passage of the Constitution Amendment Bill for the goods and services tax ( GST) in the Rajya Sabha, Central and state revenue officials are engaged in a turf war over the unified indirect tax regime. The administrative concerns, if not ironed out, may significantly dent the ease of doing business objective of the key reform, resulting in harassment of taxpayers and rise in litigation, according to experts. Central revenue officers are concerned that states want control over taxes and assessments, rendering the Central Board of Excise and Customs toothless. “ There are administrative concerns over the GST that may result in a rise in litigation and harassment of taxpayers. The GST may end up with the worst rules from state laws and central laws,” said an official who did not wish to be named. “States are striking off almost all our recommendations at the GST meetings,” he added. Gujarat, Maharashtra, West Bengal,

RBI to press pause button on Tuesday

The Reserve Bank of India ( RBI) is unlikely to tinker with its interest rates, days ahead of the US Federal Reserve policy review and the British referendum on European Union membership, say the 10 economists   polled by Business Standard. While RBI Governor Raghuram Rajan in the past has said other factors, including domestic fundamentals, outweigh the US Federal Reserve policy meets, this time it would be different. RBI is also scheduled to release its second bi- monthly policy statement for FY17 on June 7. Not only is the US Fed widely expected to raise rates in June, the possibility of a Brexit, or aBritish exit, wouldbe a majorevent for the global financial markets— and India would be impacted as well. “RBI would not want to move before assessing the outcome of the US Fed meet and Brexit in June,” said Soumya Kanti Ghosh, chief economist, State Bank of India. The Indian currency, of late, has acted somewhat jittery, losing a full rupee since the last policy review; it c