Centre, RBI step in as cash crunch hobbles ATMs across various states

Centre, RBI step in as cash crunch hobbles ATMs across various states

Several states are facing cash shortage despite currency flow in the economy going back to the pre-demonetisation level

The finance ministry held a meeting with the Reserve Bank of India (RBI), banks, and state government officials on Thursday to take stock of cash availability in automated teller machines (ATMs) after receiving complaints of cash crunch in some states.

Several states are facing cash shortage despite currency flow in the economy going back to the pre-demonetisation level. A recent analysis by the RBI to the finance ministry found that the rate of cash withdrawal was far more than the cash deposits in banks in states such as Andhra Pradesh, Bihar, Karnataka, Maharashtra, Rajasthan, Uttar Pradesh, Madhya Pradesh, and Telangana, according to the documents reviewed by Business Standard.

“We held a meeting with the RBI officials, banks, and states today (Thursday). There is no apparent cash crunch across states. Bihar and Manipur are facing some issues. Banks have been advised to optimise cash flow at ATMs well,” said a senior finance ministry official. The official added that the cash crunch was largely restricted to a few states for various reasons, including mismanagement of cash flow by banks, recalibration of ATMs, and logistical issues.

A senior RBI official said there was no dearth of currency notes and the deficiency could have been caused by local demands responding to the ebb and flow of economic activities.

“During the harvest season (rabi), transactions go up. There are always some temporary mismatches. Whenever we get intimation from our currency chests that there is a shortage, we immediately replenish. The notes in circulation are now more than what they were before demonetisation. This currency shortage theory is incorrect,” said an official with the RBI.

The notes in circulation on November 4, 2016 - four days before the Union government announced demonetisation of Rs 500 and Rs 1,000 notes - were Rs 17.74 trillion. Currency notes in circulation are now at Rs 18.04 trillion. The economy has since grown, but the notes in circulation have not grown in tandem. This may explain the discrepancy, but factors such as local elections, too, play a crucial part in hoarding of currency and it is not abnormal to see a cash crunch before key elections.

ATMs dried up in north Bihar due to issues related to transportation of cash from currency chests located in other parts of the state, sources said, adding the situation will be under control in the next few days. Last week, the finance ministry directed banks to address the situation of cash shortage at ATMs in Varanasi – the constituency of Prime Minister Narendra Modi - a senior public sector bank (PSB) executive said.

The Department of Financial Services Secretary Rajiv Kumar held a meeting with bank executives last week to take stock of the cash crunch in Karnataka. “In Karnataka, there was a high rate of cash withdrawal in the recent days. There were bank holidays towards the end of March due to which ATMs were running dry for a short spell,” sources said.

“After the introduction of Rs 200 notes, there were also some issues related to recalibration of ATMs. Banks have been told to address the issue immediately,” a finance ministry official added.

Senior bank executives said there were signs that the banking network in Madhya Pradesh could face some pressure, adding that the cash crunch at ATMs had been reported in Bihar, Andhra Pradesh, and Telangana as well. Complaints have been reported from semi-urban and rural regions of the states. But Mumbai and Delhi have been largely insulated owing to the large size of currency chests.

“We are sending extra notes to areas reporting shortage from currency chests. But we cannot move currency notes overnight as it needs arrangement for securities, especially in remote areas,” a senior State Bank of India executive said.There is a spurt in demand for cash to make payments for agricultural activities as well. “We need to get more supplies of Rs 200 and Rs 500 notes. The RBI has assured us it will improve the supply,” said a head of retail banking with a mid-size PSB.

The Business Standard, New Delhi, 13th April 2018

New income tax slab and rates for new tax regime FY 2023-24 (AY 2024-25) announced in Budget 2023

Basic exemption limit has been hiked to Rs.3 lakh from Rs 2.5 currently under the new income tax regime in Budget 2023. Further, the income tax slabs in the new tax regime has been changed. According to the announcement, 5 income tax slabs will be there in FY 2023-24, from 6 income tax slabs currently. A rebate under Section 87A has been enhanced under the new tax regime; from the current income level of Rs.5 lakh to Rs.7 lakh. Thus, individuals opting for the new income tax regime and having an income up to Rs.7 lakh will not pay any taxes The income tax slabs under the new income tax regime will now be as follows: Rs 0 to Rs 3 lakh - 0% tax rate Rs 3 lakh to 6 lakh - 5% Rs 6 lakh to 9 lakh - 10% Rs 9 lakh to Rs 12 lakh - 15% Rs 12 lakh to Rs 15 lakh - 20% Above Rs 15 lakh - 30% The revised Income tax slabs under new tax regime for FY 2023-24 (AY 2024-25) Income tax slabs under new tax regime Income tax rates under new tax regime O to Rs 3 lakh 0 Rs 3 lakh to Rs 6 lakh 5% Rs 6

Jaitley plans to cut MSME tax rate to 25%

Income tax for companies with annual turnover up to ?50 crore has been reduced to 25% from 30% in order to make Micro, Small and Medium Enterprises (MSME) companies more viable and also to encourage firms to migrate to a company format. This move will benefit 96% or 6.67 lakh of the 6.94 lakh companies filing returns of lower taxation and make MSME sector more competitive as compared with large companies. However, bigger firms have shown their disappointment since the proposal for reducing tax rates was to make Indian firms competitive globally and it is the large firms that are competing globally. The Finance Minister foregone revenue estimate of Rs 7,200 crore per annum for this for this measure. Besides, the Finance Minister refrained from removing or reducing Minimum Alternate Tax (MAT), a popular demand from India Inc., but provided a higher period of 15 years for carry forward of future credit claims, instead of the existing 10-year period. “It is not practical to rem

Don't forget to verify your income tax return in August: Here's the process

An ITR return needs to be verified within 120 days of filing of tax return. Now that you have filed your income tax return, remember to verify it because your return filing process is not complete unless you do so. The CBDT has reduced the time limit of ITR verification to 30 days (from 120 days) from the date of return submission. The new rule is applicable for the returns filed online on or after 1st August 2022. E-verification is the most convenient and instant method for verifying your ITR. However, if you prefer not to e-verify, you have the option to verify it by sending a physical copy of the ITR-V. Taxpayers who filed returns by July 31, 2023 but forget to verify their tax returns, will get the following email from the tax department, as per ClearTax. If your ITR is not verified within 30 days of e-filing, it will be considered invalid, and may be liable to pay a Late Fee. Aadhaar OTP | EVC through bank account | EVC through Demat account | Sending duly signed ITR-V through s

CA Online

Search This Blog