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The income-tax department has started a crackdown on “suspicious” bank lockers after searches and raids revealed that these were being used to stash illegal cash and jewellery. Tax officials were seeking details of lockers operated multiple times, especially in co-operative banks, after the government announced the recall of `500 and `1,000 banknotes on November 8, sources said. “Benami bank lockers are being monitored to check ownership as these have been used for illegal activities and hoarding illegal cash and wealth,” a government official said. “However, it must be re-iterated that it is aimed at addressing the black-money issue and there will be no sealing of bank lockers, as we have already said.” A benami, or ghost, locker is operated by someone other than the person in whose name it is issued. There have been instances when a holder has agreed to keep cash or jewellery for a family member, an acquaintance or even a senior at work. Large quantities of cash — Rs.600

Standard deduction for personal income tax might return after over a decade in the Union Budget for 2017-18, if the finance ministry accepts recommendations of the tax simplification committee chaired by ex-judge R V Easwar. Sources say the panel, in its second report given recently to the ministry, has suggested doing so. Standard deduction was given as a lump-sum benefit towards cost to income till 2003-04. In simple terms, it refers to a deduction allowed in income tax, irrespective of expenses incurred or investment made by assessees. "Standard deduction is simple to administer," said Amit Maheshwari, partner, Ashok Maheshwary & Associates. For the deduction, there was no need for a taxpayer to keep proof of expenses such as bills. Then finance minister P Chidambaram did away with standard deduction for salaried personnel in 2004-05, on the reasoning that there was an equivalent increase in the basic exemption limit and other deductions. It was then abolished af

Imposing service charge on food and drinks at hotels is an unfair trade practice and consumers need not pay it,Consumer Affairs Minister Ram Vilas  Paswan said on Wednesday. Although there is no provision under the existing law to take action against hotels/restaurants,consumers have the freedom to not pay the service charge and can decidet on oteat if they are informed in advance a boutit through the menu card. Paswanal some ntioned that in future,such cases would be addressed effectively, as a provision has been made in the new Consumer Protection Bill to set up a regulator CCPA.The bill is likely to see the passage in the forth coming budget session of Parliament. Addressing the mediaon this issue,Paswan said:“Our Department’s view is that imposing service charge is an unfair trade practice and consumers need not pay.”There is node finitionof‘service charge’ in law but taking service charge without discretion of consumers is an“unfair trade practice”,he said. Paswan als

National InstitutionforTransforming India (NITI)Aayog is in favour of keeping the threshold for the income tax(I-T) exemption intactatRs. 2.5 lakh.Instead,they want to extend the tax(10percent)on theRs.5lakh slab toRs.7 lakh.Officials said that the Aayog favours expansion of the tax base to enable more people too paytaxes,ratherthan expandingtheexemptionlimits. Finance Minister Arun Jaitley had raised the threshold for income tax exemption to Rs.2.5lakh from Rs.2lakh in his very first Budget for2014-15. At present, there are three slabs — 10 per cent for annual income between ~2.5 lakh and ~5 lakh, 20 per cent on annual income from ~5 lakh to ~10 lakh, and 30 per cent on income above ~10 lakh. The Aayog also advocated job creation being the central theme of the Budget. In its appraisal of the Twelfth Five-Year Plan (201213 and 2016-17) — the last such exercise before Plans winds up — the Aayog also wanted the government to curb discretionary powers of the tax officials and a

The Union Budget is expected to provide relief to companies which come under them inimumal ternate tax (MAT). Sources who attended a presentation made by the finance ministry last month said the current tax framework has made MAT aredundant levy. “While the government has already promised to lower the corporation tax rate further,it has also started work on ending tax rebates and tax holidays for companies.If foreign institutions canbe exempt from such a tax,even domestic companies should get a similar benefit,”the sources said. There ducing gap between corporation tax and MAT is one of them a in reasons for the government to consider such a step. While the current MAT rate is 18.5 percent, corporation taxes have come down to 29 percent from 35 percent earlier.And this gap will narrow further as the government has promised to bring the tax down to 25percent by 2019. Punit Shah, partner, Dhruva Advisors,said according to the road map laid down by the government,the corporation t

The Association of Mutual Funds in India (AMFI) has said it expects a significant spike in Know Your Customer (KYC) rejections and failures in opening accounts till fund houses adapt to the new Central Know Your Customer (CKYC) system. The sector body recently wrote to the Ministry of Finance saying the CKYC data requirements and uploading processes are far more stringent and complicated compared with the current Securities and Exchange Board of India KYC Registration Agency (KRA) Regulations. Switching over to the new system would require extensive training for investors, distributors and staff in all mutual funds and their registrar and transfer agents (RTAs). Regulators have instructed all financial institutions to use the CKYC registry, managed by the Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) for new customers. The new KYC record-keeping agency is jointly promoted by the government and public sector banks. The CKYC regis

India will not extend the March 31 deadline for other countries to renegotiate their investment agreements and align them to a new investment framework, commerce and industry minister Nirmala Sitharaman said on Tuesday. Further, investments from countries that fail to renegotiate investment protection agreement by April 1will not get complete benefit under any treaty With only three months left for India’s Bilateral Investment Treaty (BIT) to come into force, not many countries have approached the government to renegotiate their existing investment pacts based on the model BIT text. “We had given one year’s time for countries with whom we have investment agreements to come and renegotiate them… We are waiting for them to come and talk,” the minister said There will be a hiatus between the expiry of old pacts and the inking of new ones during which investors will not get the same level of treaty protection. The European Commission (EC) has raised concerns over negotiations for