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99% of banned notes returned after demonetisation: RBI annual report

99% of banned notes returned after demonetisation: RBI annual report The Reserve Bank of India (RBI) on Wednesday said it estimated that people had returned almost 99 per cent of the scrapped Rs 1,000 and Rs 500 notes after demonetisation, effectively putting a question mark over the government gaining handsomely by the unreturned money turning into a special dividend by the central bank. In its annual report, the RBI also said the face value of fake high-value notes was minuscule at Rs 41 crore. The central bank said people had returned Rs 15.28 lakh crore of the Rs 15.44 lakh banned currency, or 98.96 per cent of the scrapped Rs 500 and Rs 1,000 notes, to the banking system. “Subject to future corrections based on the verification process when completed, the estimated value of Specified Bank Notes received as on June 30, 2017, is Rs 15.28 lakh crore,” the annual report said.  The old notes came to the RBI either directly or from bank branches and post offices through the currency chest m…

Green light for 25% GST cess makes automakers see red

Green light for 25% GST cess makes automakers see red Bigger sedans and sports utility vehicles (SUVs) will cost more now, as the Cabinet on Wednesday cleared an ordinance to increase the cess ceiling on these vehicles to 25 per cent from 15 per cent. This cess would be over and above the peak goods and services tax (GST) rate of 28 per cent on these vehicles. Hybrid vehicles will continue to attract a cess of 15 per cent.   Announcing this decision, Finance Minister Arun Jaitley said the objective of any taxation policy cannot be that luxury goods become cheaper and essential items become costlier. “If at all relief is to be given, it has to be given to a common man’s item rather than a luxury item. So a person who can afford Rs 1 crore for a vehicle can also afford Rs 1.20 crore.” The exact increase in the cess will be taken up by the GST Council, which will meet on September 9 in Hyderabad. It is widely speculated that a maximum cess of seven per cent will be applicable.  A decision to …

Delisted firms to contest BSE order

Delisted firms to contest BSE order The promoters of at least two dozen of the 200 companies that have been compulsorily delisted by the BSE plan to file a writ petition against the Securities and Exchange Board of India (Sebi) and the stock exchange. Their contention is that they are under liquidation and therefore not liable to follow the delisting process, which entails payout to minority shareholders. Around 45 companies in the list of 200 are undergoing liquidation. These include Alpic Finance, Blue Bird, CFL Capital Financial Services, Dhanus Technologies, Koutons Retail India and DSQ Biotech. Official liquidators have been appointed to wind up the companies’ affairs and to sell-off assets. The assets are being used to pay shareholders followed by the claims of creditors. “BSE had gone ahead with compulsorily delisting without any prior approval from appellate tribunal. We have not been intimated about it, neither have we been given a chance of a hearing,” said the promoter of one …

Defence ministry trims Army flab; 57,000 soldiers will shift to combat roles

Defence ministry trims Army flab; 57,000 soldiers will shift to combat roles The Army currently deploys more soldiers on non-combat administrative and supply chain duties than in the trenches in wartime. On Wednesday, to increase what the defence ministry terms the Army’s teeth-to-tail ratio by putting a larger percentage of soldiers on the frontline, Defence Minister Arun Jaitley ordered 65 reforms to the structure of the military. Improving the teeth-to-tail ratio involves whittling down administrative and logistic units that support combat operations, and redeploying the manpower thus saved into combat units. The defence ministry says the 65 reforms must be completed by December 31, 2019, involving “redeployment and restructuring of approximately 57,000 posts of soldiers and civilians.” These reforms are part of the 99 measures recommended by the Lieutenant General (Retired) D B Shekatkar Committee, which former defence minister Manohar Parrikar constituted in 2015. The committee submi…

GST, farm debt waivers likely to hit fiscal consolidation

GST, farm debt waivers likely to hit fiscal consolidation A day after the government released buoyant tax figures because of the goods and services tax (GST), the Reserve Bank of India cast doubts over short-term revenue mobilisation.  Besides, farm debt waivers in some states could mar fiscal consolidation efforts there, it said. This, the report said, could impact fiscal consolidation at both the Centre and state levels, as this fundamental reform gains pan-India traction.  According to figures released by Finance Minister Arun Jaitley on Tuesday, the Centre and state governments have earned Rs 92,283 crore from the GST in July, against a target of Rs 91,000 crore. This  even as 36 per cent of assessees did not file returns. On Wednesday, the RBI warned: "Additionally, state government finances are likely to face several challenges during 2017- 18. First, the announcement of farm loan waivers by four state governments and the potential announcement by several others pose a major fi…

Government may announce a new ‘outcome-oriented’ industrial policy by October

Government may announce a new ‘outcome-oriented’ industrial policy by October Nirmala Sitharaman to hold consultations with stakeholders, including industry captains, think tanks and states to finalise the policy. Government will announce the new industrial policy in October this year, seeking to make India a manufacturing hub by promoting ‘Make in India’ and addressing the issue of slower job creation. Commerce and industry minister Nirmala Sitharaman will hold talks with stakeholders, including industry captains, think tanks and state governments in Chennai, Guwahati and Mumbai to finalise the policy. In a press statement, Department of Industrial Policy and Promotion (DIPP) said the government wants to formulate “an outcome oriented actionable industrial policy that provides direction and charts a course of action for a globally competitive Indian industry which leverages skill, scale and technology.” DIPP has floated a discussion paper to have a “future ready new industrial policy” to …

Govt might allow revised returns for input credit for pre-GST stocks

Govt might allow revised returns for input credit for pre-GST stocks Unavailability of the form offline made it difficult for companies to punch in details manually In a respite for companies with big claims of input tax credit for pre-goods and services tax (GST) stocks, the government is likely to allow rectifications of returns filed. The revenue department is consulting the law committee on the matter. Although companies have been given 90 days to file the TRAN 1 form to claim input tax credit for stocks bought before July 1, the last date for filing it was August 28. Unavailability of the form offline made it difficult for companies to punch in details manually, increasing the chances of under reporting or incorrect filing. No provision for rectification of transitional credit claims might mean companies losing credit. “We are aware of the concerns with respect to rectification of returns. We are consulting the law committee to see if we can allow entities to revise their TRAN 1 form,…