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I-T Dept probes Rs 10-bn tax refund fraud by govt and PSU employees I-T wing identifies over 18,000 revised returns, claiming false refunds in Mumbai, Bengaluru With less than a month left for revising income-tax (I-T) returns for 2016-17, the I-T department has unearthed a giant fraud in multiple cities, where government employees allegedly claimed huge tax refunds forging documents, inflating expenses and not revealing complete information In Mumbai alone, around 17,000 revised returns have been filed claiming refunds. Similarly, in Bengaluru, the I-T department has found over 1,000 returns filed with inflated claims on account of payments towards home loans. Since the I-T department is still investigating the matter, the loss to the department could not be ascertained, but it could go up to over Rs 10 billion, sources said. They added most of these refunds were being claimed by employees working for the government or in public sector undertakings (PSUs). “These assessees’ ...

RBI to infuse Rs 1 trn into banking system via special auctions in March Higher tax outgo will fuel cash demand by banks, corporate sectors The Reserve Bank of India (RBI) will infuse up to Rs 1 trillion into the banking system through special auctions this month to manage additional demand for liquidity as activities of banks and corporate entities pick pace before the close of the financial year. The current financial year (2017-18) ends on March 31. Treasury executives said liquidity in the system has been under pressure, with supply falling short of demand on some days. The RBI has maintained its stance to keep liquidity close to neutral. The announcement to conduct special auctions to inject additional resources into the system to tackle the changing situation — high activity and outgo on account of tax payments — will give respite to the market, and prevent any sharp rise in short-term interest rates. Last month, the RBI had indicated that it was prepared to inject adeq...

 RBI to inject Rs 1 lakh cr cash into banking system in March  The Reserve Bank of India will inject Rs 1 lakh crore short term money into the banking system ahead of the financial year-end that normally sees cash crunch.  The move is likely to keep short term rates under check benefiting borrowing companies.  “In order to address additional demand for liquidity and with a view to provide flexibility to the banking system in its liquidity management towards March-end, it is prepared to inject adequate additional liquidity….,” RBI said in a release.  The central bank will use a combination of appropriate instruments for such fund infusion, while continuing with its normal liquidity adjustment facility (LAF) operations.  Beginning Tuesday RBI will conduct four variable repo operations of Rs 25,000 crore each.  After reviewing the current and evolving liquidity conditions in the banking system it has been decided to conduct additional variable rat...

 Delhi-Jaipur E-way: Land Prices Rise 40% The long-held theory that infrastructure creation leads to spike in realty rates can find no better demonstration than just outside Delhi. Manesar and Rewari in Haryana, and Neemrana and Ajeetgarh in Rajasthan, are not just the names of semi-urbanised industrial belts en route the proposed Delhi-Jaipur expressway but are the latest hotspots for realtors that are seeing as much as 40 per cent appreciation in land rates. The interesting part, however, is officials in the National Highways Authority of India (NHAI) and the Ministry of Road Transport and Highways say the new alignment has been almost finalised but is yet to be officially notified or announced. Sometimes the source of such challenge for project cost that comes with spike in land rates lies in the ministry itself. Union road transport and highway minister Nitin Gadkari had, in the past, announced development of new projects in some states and the land prices in the area w...

Services sector contracts, putting pressure on govt A private survey showed that India’s dominant services sector contracted for the first time in three months, adding pressure on Prime Minister Narendra Modi to undertake reforms to boost growth amid a hawkish turn from the Reserve Bank of India (RBI). The Nikkei India Services Purchasing Managers’ Index slid to 47.8 in February from 51.7 in January, as business conditions deteriorated due to poor demand. A number below 50 indicates a contraction. A dip in the services sector, which contributes about 60% to the Indian economy, could hurt an economy that’s forecast to grow at its slowest pace in four years. Sluggish growth, coupled with a lack of adequate job creation, is building pressure on Modi to jumpstart economic activity before seeking re-election in 2019. RBI, which will review interest rates on 5 April, has flagged risks to inflation from higher crude oil prices and the budget, which widened fiscal deficit goals to boos...