ATM Transactions - Own bank 5, others 3 in Metros and 5 + 5 in other places - RBI

ATM Transactions 

            As per present guidelines of Reserve Bank of India (RBI), from November 1, 2014, banks are mandated to offer minimum five free transactions per month in own bank ATMs and three in other bank ATMs in six metro centres (Mumbai, New Delhi, Chennai, Kolkata, Bengaluru and Hyderabad). In non-metro centres, minimum five free transactions per month in own bank ATMs and five in other bank ATMs are mandated. Banks are free to offer free transactions above the mandated limit specified by RBI.

            As on 24th February, 2016, Department of Posts (DoP) has installed 550 ATMs out of a target of 1000 ATMs in various parts of the country.

            As on 31.12.2015, Scheduled Commercial Banks (SCBs) have 193434 ATMs across the country, out of which 33249 ATMs are in Rural Centres and 51925 in semi-urban centres. In order to expand the reach of ATMs in Tier III centres (population between 20,000 to 49,999) to Tier VI centre (population less than 5000), RBI has permitted non-bank entities incorporated in India. Three different schemes are available to such While Label ATM operators for setting of While Label ATMs (WLAs), which incentivize setting up of WLAs in Tier III to Tier VI centres, details of which are available in RBI Circular No. DPSS.CO.PD.No. 2298. 10.002.2011-2012 dated 20.6.2012 available on RBI’s website ( as on 31.2.2015, 11706 WLAs have been set up.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.


Paternity Leave to Bank Employees 
Grant of Paternity Leave to bank employees has been accepted under the 10th Wage Negotiation Settlement signed between Indian Banks’ Association (IBA) and the Unions/Associations of employees.

Male employees with less than two surviving children shall be eligible for 15 days paternity leave during his wife’s confinement and may be availed upto 15 days before or upto 6 months from the date of delivery of the child.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today. 
Online Selling of Products by Public Sector Insurance Companies 
As per the information furnished by Insurance Regulatory and Development Authority of India (IRDAI), the price of insurance products sold online through the Insurance Company’s website, without any intervention of agent or intermediary, is lower in comparison to the offline version because no commission is payable in such cases. The cost of online products sold by the insurers gets reduced by the amount of savings due to non-payment of commission on such products. However, any system establishment expenses, expenses related to call centre to assist online customers etc., get added to the price of such products. Hence, the prices may vary when the products are sold through online and offline.

The online payment system of insurance companies are functioning properly and regularly and no instances have come to the notice of the Authority

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today. 
Tax Administration Reforms Commission 
            The Government has received the Report of Tax Administration Reforms Commission (TARC) headed by Dr. Parthsarathi Shome. The Report has four volumes containing a number of tax administration reforms. The broad recommendations inter-alia include changes in structure, improvement in taxpayers service, enhanced use of information and communication technology, exchange of information with other agencies, strengthening of human resource management, key internal processes, customs capacity building, impact assessment, expansion of base, compliance management, revenue forecasting, predictive analysis and research for tax governance etc. These recommendations are at various stages of examination/acceptance/implementation. The recommendations of TARC accepted and implemented so far may be seen at Department of Revenue’s website

            A number of steps have been taken to facilitate the direct tax payers which inter-alia include measures aimed at reducing litigation, setting up of a dedicated structure to deal with grievances of the taxpayers, simplification of procedures, enhancement of e-facilities including electronic verification of income tax return, e-sahyog etc.

            Further, for the welfare of indirect tax payers the following steps have been taken:

·         Establishment of 24X7 customs clearance facility in 17 airports and 18 seaports.
·         Customs Single Window Clearance Project for faster customs clearance.
·         Implementation of e-BRC (BRC-Bank Realization Certificate) module
·         Establishment of Help Desk at prominent places at international airports for facilitating passengers including business travelers.
·         Reduction in number of export and import documents required by customs from 5 to 3 so as to reduce transaction cost.
·         Integrated customs EDI – SEZ Online system to facilitate paper-less movement of export and import goods between SEZs and Gateway ports.
·         Customs Accredited Client Programme (ACP) reviewed with a view to allow a graded re-entry to disqualified ACP clients to facilitate major importers.
·         Rationalization of penal provisions in Customs, Central Excise and Service Tax.
·         New Central Excise/Service Tax registrations to be given within two days of filing of application, with post facto verification, if required.
·         E-payment of service tax and central excise made mandatory for all assesses/taxpayers to reduce the cost of compliance for the trade and industry.
·         Acceptance of digitally signed invoices and providing for maintenance of electronic records with duly authenticated digital signature.
·         Direct dispatch of goods allowed for job workers as well as registered dealers and importers.
·         Time limit for availing Cenvat Credit increased from 6 months to 1 year.
·         Circular issued extending facility to pay arrears in installments extended and for amendment of Garnishee order.
·         Rules amended to provide clarity regarding valuation of goods in Central Excise when the transaction value is below the cost of manufacture of goods.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

Clarification regarding taxability of consortium members 
Taxation of consortium of contractors formed to implement Engineering, Procurement and Construction (EPC) contracts/turn key projects has been a subject matter of dispute between Income-tax Department and the consortium. This has been particularly so in cases where each member of the consortium has a clear and district role in scope of work, responsibilities and liability of the consortium even though each member is jointly and severally liable to the contractee

To bring about consistency in approach while handling cases of consortium, the Central Board of Direct taxes has issued Circular No. 7/2016 clarifying the attributes of a consortium arrangement which may not be treated as an Association of  Persons(AOP). The list of attributes is not exhaustive. There may be additional factors which may justify not treating a consortium asan AOP depending on specific facts and circumstances.

The Circular will not apply to cases where all or some of the members of the consortium are Associated Enterprises as defined in section-92A of the Income-tax Act.

This Circular is expected to reduce litigation with consortium of contractors implementing EPC contracts/turnkey projects.

Circular No.7/2016 is available on the website of the Department

Issue of clarification on contentious TDS issues on payments made by Television channels, Broadcasters and Newspapers 
With a view to bring about clarity in the interpretation of certain contentious issues relating to Tax Deduction at Source (TDS) on payments made by television channels, broadcasters and newspapers, Central Board of Direct Taxes has issued two Circulars.

Circular No.4/2016 dated 29.02.2016 deals with TDS on payments by broadcasters or television channels to production houses for production of content or programme for telecasting. It has been clarified in the Circular that in a situation where the content/programme is produced as per the specifications provided by the broadcaster/telecaster and the copyright of the content/ programme also gets transferred to the telecaster/broadcaster, such contract is covered by the definition of the term ‘work’ in section 194C of the Income-tax Act and, therefore, subject to TDS under section 194C at 2%,  rather than at a rate of 10% under section 194J as payment for ‘professional or technical services’. 

Circular No.5/2016 dated 29.02.2016 deals with TDS on payments by television channels and publishing houses to advertisement companies for procuring or canvassing for advertisements. It has been clarified through the Circular that no TDS is attracted on payments made by television channels/newspaper companies to the advertising agency for booking or procuring of or canvassing for advertisements. This clarification puts at rest the litigious issue as to whether such payments/discounts are in the nature of ‘commission’ and so, subject to TDS at the rate of 10% under section 194H.
Both the Circulars are available on the website of the Department

Indian Economy to grow at robust pace; GDP growth expected in the range of 7 to 7.75 per cent in coming year 
As per the Advanced Estimates released by Central Statistics Office (CSO), the growth of Gross Domestic Product (GDP) at constant (2011-12) market prices is estimated at 7.6 per cent in 2015-16 indicates that despite uncertainties in the global economy, Indian economy stands out as a haven of macroeconomic stability, resilience and optimism and can be expected to register GDP growth that could be in the range of 7 to 7.75 per cent in the coming year. International Monetary Fund, in their World Economic Outlook Update (January 2016) has indicated that India is projected to continue growing at a robust pace.

As per the Budget 2016-17, the fiscal deficit as a ratio of GDP at current market prices is estimated at 3.9 per cent for the year 2015-16 (revised estimates). As per the Advanced Estimates released by Central Statistics Office (CSO), the growth of GDP at constant (2011-12) market prices is estimated at 7.6 per cent in 2015-16. This estimation has been done in accordance with the international best practices.

The fixed investment (measured by Gross Fixed Capital Formation) by the private corporate sector increased from 11.7 per cent of the GDP at current market prices in 2013-14 to 12.3 per cent in 2014-15 (the latest year for which data is available), despite indications of constraints like stressed assets. Investment depends on various factors that, interalia, include: expectations of demand viz-a-vis the available capacity, expected profit, business climate and interest rate. The Government has taken a number of steps to improve the business climate and boost investment n the economy which, among other, include: the “Make in India” initiative along with the attendant facilitatory measures for a more conducive environment for investment; Start-up India initiative to boost entrepreneurship and creation of jobs; opening up of specified sectors for foreign direct investment; and investment-augmenting tax measures. The Reserve Bank of India reduced the policy repo rates by 125 basis points during 2015.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today. 
Investment in Infrastructure 
As per the White Paper on Infrastructure Financing brought out by CRISIL Ratings and ASSOCHAM India in December, 2015, it is estimated that the country would need Rs. 31 lakh crores investment in infrastructure during 2015-20. The Paper estimates that about 70 per cent o this will be required in the power, roads and urban infrastructure sectors. The Paper further estimates that over two-thirds of the investment (seventy per cent) would need to be funded through debt and thirty per cent would be through equity.

Apart from public investment, Government has taken steps to mobilize other sources of investment funds from various sources for development of basic infrastructure, including through the establishment of Infrastructure Debt Funds, Real Estate/Infrastructure Business Trusts (REITs/InvITs), relaxation in External Commercial Borrowing (ECB) and Foreign Direct Investment (FDI) norms, mainstreaming of Public Private Partnerships (PPPs), liberalization of lending norms by banks to infrastructure sector, relaxation of norms for Employees’ Provident Funds Organisation (EPFO)/pension funds investment in infrastructure sector, establishment of National Infrastructure Investment Fund (NIIF) etc.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today. 
Subsidies on Commodities 

            The subsidy bill of the Central Government has remained in the range of Rs. 2.50 lakh crore to Rs. 2.58 lakh crore during the period, 2014-15 to 2016-17 (Budget Estimates). The fiscal deficit of the Central Government, which is the difference between total expenditure and non-debt receipts, has been in the range of Rs. 5.11 lakh crore to Rs. 5.35 lakh crore in this period. As proportion of GDP, both subsidy bill and fiscal deficit declined during this period.

            Details of subsidies given under different heads are in table below:

Details of Subsidies (Rs. in crore)
2015-16 RE
RE=Revised Estimates

            Direct Benefit Transfer (DBT) was started in 1.1.2013 and expanded across all Central Sector/Centrally Sponsored Schemes involving cash transfers to individual beneficiaries in February 2015. In cash transfer, the benefit is transferred in the beneficiary’s account, preferably Aadhaar seeded. Presently, LPG subsidy is transferred directly in to the bank accounts of beneficiaries. Food subsidy in cash is disbursed in wo Union Territories viz, Puducherry and Chandigarh, directly in beneficiaries’ bank accounts, in kind, after biometric authentication, in 70000 fair price shops at present. The Union Budget 2016-17 has indicated the introduction of DBT on pilot basis for fertilizer in a few districts across the country. Hence, it is difficult to indicate a timeframe for completing the shift to the system of cash transfer.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.

Stand Up India Scheme 
The Cabinet has approved the “Stand Up India Scheme” to promote entrepreneurship among Scheduled Caste/Schedule Tribe and Women.

The schemes provides for composite loans by banks between Rs. 10 lakh and upto Rs. 100 lakh for setting up a new enterprise in the non-farm sector. These loans would be eligible for refinance and credit guarantee cover.

A credit guarantee fund of Rs. 5,000 crore for providing guarantee cover for loans under Stand Up India in next five years has been approved. Provision of initial capital of Rs. 500 crore to the corpus in FY 2016-17 has been made.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today. 

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