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EPFO may Give Part Payout in MF-Like Units Dividend on equity investments may also be distributed among its 45 million subscribers Subscribers to the Employees' Provident Fund Organisation (EPFO) may soon get part of their retirement payout in the form of units proportionate to the money the state-run pension fund invests in equities, a senior official said. EPFO invests up to 15% of its annual incremental corpus -pegged at ` . 1.4 lakh crore -in stocks through exchange-traded funds (ETFs) to take advantage of higher returns from equities. The rest of the money is invested in government securities and other forms of debt. However, on retirement, the subscriber gets a consolidated sum based on interest rate decided by the EPFO's central board of trustees (CBT). If the proposal cited above is adopted, then part of this payout will be in the form of units, similar to that of a mutual fund, that can be encashed at time of exit. This would also mean that the dividend earned ...

DIPP approves three FDI proposals, including Wockhardt’s The commerce and industry ministry on Wednesday said it has approved three foreign direct investment (FDI) proposals, including that of Wockhardt Ltd and Coastal Local Area Bank. The department of industrial policy and promotion (DIPP), under the commerce ministry, has also approved KPB Holdings’ proposal to issue shares to non-resident Indians (NRIs). While Coastal Local Area Bank got nod for issuance of shares to NRIs, Wockhardt Ltd got approval for issuance of employee stock option plan to NRIs. The Mint, New Delhi, 5th October 2017

Loan pricing via external benchmark likely soon Move will help consumers compare loans fairly The Reserve Bank of India pulled up lenders for keeping interest rates on loans at a higher level and said it would make another system to fix rates for such loans.The banking regulator expressed concern over base rate and marginal cost of funds-based lending rate (MCLR) and said these internal benchmarks have not improved monetary transmission. A new system using external benchmarks to price loans would be introduced, the RBI said. In its report, an internal RBI study group to review the working of the MCLR system has suggested switching over to the new system in a time-bound manner, so that better rates are available to borrowers. The report said banks should use three benchmarks — Treasury bill rate, certificate of deposit rate and RBI’s policy repo rate – for pricing loans. Against the current system of annual reset of interest rates, the panel recommended quarterly reset. All bo...

RBI Cuts growth forecast REPO RATES STAYS AT 6%, SLR REDUCED BY 50 BPS NO SPACE LEFT FOR FISCAL STIMULUS,SAYS GOVERNOR The Reserve Bank of India (RBI) kept its policy rates unchanged on Wednesday, revised its inflation forecast for the second half of the fiscal year, and lowered the growth forecast sharply, while asking the government not to be too ambitious with its fiscal stimulus package. Five members of the six-member monetary policy committee (MPC), headed by RBI Governor Urjit Patel, voted for a pause. Ravindra Dholakia voted for a 25 basis point cut. Following the fourth bi-monthly monetary policy, the repo rate remained at 6 per cent. While continuing with its glide path of bringing down banks’ mandatory bond holdings, the central bank reduced the statutory liquidity ratio by 50 basis points to 19.5 per cent of the deposit base. The policy stance remained ‘neutral’. One basis point is 0.01 per cent.Patel said in an interaction with the media that between the states ...

Economy on right track: PM Modi Slams UPA, says it's not first time growth has fallen to 5.7% in a quarter Prime Minister Narendra Modi on Wednesday lambasted the critics of his government´s economic policies and expressed commitment to carrying out further reforms to reverse the trend of declining GDP (gross domestic product) growth. Modi compared the “achievements” of the three years of the National Democratic Alliance (NDA) government led by him against the “failures” of the previous United Progressive Alliance (UPA) regime, arguing this was not the first time that the economic growth had fallen to 5.7 per cent in a quarter. The UPA regime´s record was much worse, he added. He said the current government had made a paradigm shift from policy paralysis of the previous government to policy implementation. Modi assured the companies coming into the formal economy, that they would not be hounded and their old records would not be examined. He said demonetisation had le...

Advance Authority for Rulings in Demand to Clear Doubts on GST Fight for Forum Cos, associations approaching courts in absence of advance ruling mechanism A few senior tax officials and corporates have requested the government to start Advance Authority for Rulings as early as possible to clear doubts on goods and services tax (GST), as this will prevent companies and associations from approaching courts for clarity . Advance Authority for Rulings (AAR) is a forum companies customarily approach to get clarity on certain tax issues to determine their future liability. Absence of such an authority is leading to many companies and associations dragging the GST Council and government to court, say industry trackers. At the last count, about 10 writ petitions were filed, challenging some aspect of GST. About half a dozen more writs would be filed in the next fortnight alone. The trigger may have been some prominent companies, associations and multinational banks having either moved co...

Disqualified Directors Seek Reprieve from Ministry Disqualified directors have started knocking on the doors of the Ministry of Corporate Affairs (MCA) seeking reprieve from the debarment ordered by the government last month, with several of them explaining to the government that they have been wrongly disqualified and that they were not associated with the struck-off companies. The government could consider coming up with some solution for the aggrieved directors since no recourse is currently available under the Companies Act 2013. While companies can approach the National Company Law Tribunal (NCLT), directors have no such option. “The directors have got disqualified by the operation of law. We had sent notices to the companies before we struck off their names. We are seeing what can be done now...discussions will start soon,“ a senior official told ET. Chartered accountants and company secretaries have also met government officials over the disqualification of directors. Many C...

Sebi breather on loan default disclosure Regulator is considering increasing the timeline for disclosing defaults to 30 days The Securities and Exchange Board of India (Sebi) is looking to issue a more relaxed loan default disclosure framework. According to sources, the market regulator now plans to give up to a month’s time to companies for disclosing loan defaults and also make provision to explain the nature of the default. Under the previous proposal (according to a circular dated August 4) — the implementation of which has been deferred — Sebi had mandated companies to make public any loan default within 24 hours of missing the repayment obligation. Sources said Sebi is re-looking at some of the contentious issues in the proposed circular, which have been brought to its notice by market players, including industry bodies, banks and rating agencies. Under the revised directives, Sebi may increase the “delta D” or date of default to 30 days and may give some additional time to...

Centre to crack whip on firms not filing cost audits The Ministry of Corporate Affairs is planning to pull the plug on companies that do not file cost audits to ensure these businesses pay accurate corporation taxes and consumers know the pricing of products. A senior official said the ministry will examine companies across 10 sectors to identify companies that do not hire cost accountants and file reports. Textiles, machinery, insecticides, milk powder, glass, tea and coffee are some of the sectors that will be monitored. The move will ensure firms do not evade corporation tax, the official explained. Cost audit, which reflects efficiency of the company concerned, also provides the consumer an idea about the fair price of products. The official stated the plan is being thought of in the interest of investors as well. “Filing of cost audits will tell us if companies are fudging numbers, and will also tell investors what the company’s costing plan is,” the official added. At present...

GST anti-profiteering body: Govt to examine contours today The Union Cabinet is likely to approve setting up of an anti-profiteering authority under the goods and services tax (GST) regime on Wednesday. Prime Minister Narendra Modi headed Cabinet may also approve creation of the post of chairman and four technical members of the authority on Wednesday, officials said. To keep a tab on businesses that have not passed on to consumers the benefit of lower tax rates under the GST regime, the GST Council had approved setting up of a five member National Anti-Profiteering Authority. The authority will have a sunset date of two years from the date on which the chairman assumes charge. The chairman and the four members of the authority have to be less than 62 years. The Business Standard, New Delhi, 04th October 2017

Tax dept to engage with corporates to spur receipts Amid slowing growth in advance tax collections, the income-tax department is exploring enhanced engagement with the top 100 companies to facilitate compliance. A committee set up under the direct tax department to review assessment and scrutiny has identified “taxpayer segmentation” to improve collections. “The idea is to provide differential treatment to big taxpayers as they make up for the bulk of the revenue collection. The tax department is, after all, a 30 per cent stakeholder in corporate sector earnings. Stepping up engagement with them will help the department and the companies,” said a government official. The idea is to have a dedicated tax officer who will act as a one-point contact, keeping a close watch on a company’s quarterly results or performance, facilitating advance tax filing and helping estimate earnings for advance tax computation. Advance tax collection up to September 15 slowed to 11 per cent as against 14...