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Developments In India’s Balance Of Payments During The Second Quarter (Jul-Sep) Of 2017-18

Dec 13, 2017: Preliminary data on India’s balance of payments (BoP) for the second quarter (Q2), i.e., July-September 2017-18 are presented in Statements I (BPM6 format) and II (old format). (Source: RBI)

Key Features of India’s BoP in Q2 of 2017-18
  • India’s current account deficit (CAD) at US$ 7.2 billion (1.2 per cent of GDP) in Q2 of 2017-18 narrowed sharply from US$ 15.0 billion (2.5 per cent of GDP) in the preceding quarter, but was substantially higher than US$ 3.4 billion (0.6 per cent of GDP) in Q2 of 2016-17.
  • The widening of the CAD on a year-on-year (y-o-y) basis was primarily on account of a higher trade deficit (US$ 32.8 billion) brought about by a larger increase in merchandise imports relative to exports.
  • Net services receipts increased by 13.1 per cent on a y-o-y basis mainly on the back of a rise in net earnings from software services and travel receipts.

India Signs Loan Agreement With World Bank For US$ 250 Million For SANKALP Project

Dec 13, 2017: India Signs Loan Agreement with World Bank for US$ 250 Million for “Skills Acquisition and Knowledge Awareness for Livelihood Promotion” (SANKALP) Project. (source)

A Financing Agreement for IBRD loan of USD 250 million (equivalent) for the “Skills Acquisition and Knowledge Awareness for Livelihood Promotion (SANKALP) Project” was today signed with the World Bank. The Financing Agreement was signed in New Delhi by Joint Secretary, Department of Economic Affairs Shri Sameer Kumar Khare on behalf of Government of India and Mr. Junaid Kamal Ahmad, Country Director, World Bank (India) on behalf of the World Bank.

The Objective of the project is to enhance institutional mechanisms for skills development and increase access to quality and market-relevant training for the work force.

IBBI Issues Guidelines For Technical Standards For Core Services Of Information Utilities

Dec 13, 2017: Based on recommendations of the Technical Committee, the Insolvency and Bankruptcy Board of India laid down today Technical Standards for the performance of core services for the following matters under regulation 13 of the IBBI (Information Utilities) Regulations, 2017:

[CBEC] Refund / Claim Of Countervailing Duty As Duty Drawback

CBEC's Circular No. 49/2017-Cus dated the 12th December, 2017 regarding Refund/Claim of Countervailing duty as Duty Drawback, is as under:-

1. Attention is invited to the Circular Nos. 106/95-Cus dated 11.10.1995 and 23/2015- Cus dated 29.9.2015 regarding refund/claim of Anti-Dumping Duty and Safeguard Duties as Duty Drawback respectively.

2. With respect to Countervailing Duties which are leviable under section 9 of the Customs Tariff Act, the Board clarifies that these are rebatable as Drawback in terms of Section 75 of the Customs Act. Since Countervailing Duties are not taken into consideration while fixing All Industry Rates of Duty Drawback, the Drawback of such Countervailing Duties can be claimed under an application for Brand Rate under Rule 6 or Rule 7 of the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995 and/or the Customs and Central Excise Duties Drawback Rules, 2017, as the case may be. This would necessarily mean that drawback shall be admissible only where the inputs that suffered Countervailing Duties were actually used in the goods exported as confirmed by the verification conducted for fixation of Brand Rate.

14.4% Growth In Foreign Tourist Arrivals In November, 2017 Over November, 2016

Dec 12, 2017: Ministry of Tourism reported that there was a 14.4% growth in Foreign Tourist Arrivals in November, 2017 over November, 2016. [56.2% growth in foreign Tourist Arrivals on e-Tourist visa in November, 2017 over November, 2016]

Ministry of Tourism compiles monthly estimates of Foreign Tourist Arrivals (FTAs) and FTAs on e-Tourist Visa on the basis of Nationality-wise, Port-wise data received from Bureau of Immigration (BOI).

The following are the important highlights regarding FTAs and FTAs on e-Tourist Visa during the month of November, 2017:

Foreign Tourist Arrivals (FTAs)

[CBEC] Apprehensions About Negative Effects Of Certain Tax Demands On Software Industry Are Without Basis

Dec 12, 2017: CBEC press release - It was reported in certain sections of the Press that tax officials had raised tax demand in respect of export of IT/IT enabled services provided to clients abroad and that this had been done on the basis of place of supply rules in respect of these services which were apparently provided in India and therefore were liable to be taxed.

CBEC Appeals Taxpayers Who Have Claimed Transitional Credit Erroneously To File Revised Form TRAN-1 By 27th Dec 2017

Dec 12, 2017: CBEC issued a press release on filing of Form TRAN-I to avail Input Tax Credit, which reads as under:

1. Transition to GST provided for trust based transition of input tax credit of the existing taxpayers. A tax payer could file Form TRAN-1 and avail input tax credit on the basis of closing balance of the input tax credit declared in the last return under the pre GST regime. The last date for filing of Form TRAN-1 is 27th December, 2017. In keeping with the philosophy of voluntary compliance, revision of Form TRAN-1 has also been provided. The last date for revision of TRAN-1 is also 27th December, 2017.

RBI's Monthly Bulletin For December 2017

Dec 11, 2017: The Reserve Bank of India today released the December 2017 issue of its monthly Bulletin. The Bulletin includes fifth Bi-monthly Monetary Policy Statement for the Year 2017-18, Resolution of the Monetary Policy Committee (MPC), Reserve Bank of India, Speeches by the Top Management, Two Articles, Current Statistics, and Indicative Calendar for Bulletin Articles, 2018. The two articles are: I. Anatomy of India’s External Debt: Assessment of Key Trends; and II. Survey on International Trade in Banking Services: 2016-17.

I. Anatomy of India’s External Debt: Assessment of Key Trends

The article provides a snapshot of the developments relating to India’s external debt in 2016-17 and assesses its changing profile since the early 1990s.

Major highlights of the article are as follows:
  • India’s external debt stock was placed at US$ 471.9 billion at end-March 2017, recording an annual decline for the first time after 2001-02.

[Customs] Exchange Rate Notification w.e.f. 8th December, 2017

CBEC has notified the rate of exchange of one unit of foreign currency equivalent to Indian rupees relating to imported and export goods, in its notification no. 113/2017 - Customs (N.T.) dated 7th December, 2017 (w.e.f. 8th December, 2017). The contents of the said notification is as follows:

Direct Tax Collections For Financial Year 2017-18 Show Growth Of 14.4% Upto November, 2017

10-Dec-2017: The provisional figures of Direct Tax collections up to November, 2017 show that net collections are at Rs. 4.8 lakh crore which is 14.4% higher than the net collections for the corresponding period of last year.

The Net Direct Tax collections represent 49% of the total Budget Estimates of Direct Taxes for the Financial Year. 2017-18 (Rs. 9.8 lakh crore).  Gross collections (before adjusting for refunds) have increased by 10.7% to Rs. 5.82 lakh crore during April-November, 2017. Refunds amounting to Rs. 1.02 lakh crore have been issued during April, 2017 to November, 2017.

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[Tax Updates]

Provisions Of Financial Resolution & Deposit Insurance Bill, 2017 Meant To Protect Interests Of Depositors

07-Dec-2017: The Financial Resolution and Deposit Insurance Bill, 2017 (FRDI Bill), introduced in the Lok Sabha on August 10, 2017, is presently under the consideration of the Joint Committee of the Parliament. The Joint Committee is consulting all the stakeholders on the provisions of the FRDI Bill. Certain misgivings have been expressed in the media regarding “bail-in” provisions of the FRDI Bill. 

The provisions contained in the FRDI Bill, as introduced in the Parliament, do not modify present protections to the depositors adversely at all. They provide rather additional protections to the depositors in a more transparent manner.

[CBEC] Clarification On Customs (Import Of Goods At Concessional Rate Of Duty) Rules, 2017

CBEC, vide Circular No. 48/2017-Customs dated the 8th December, 2017, has issued some clarifications on Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017. The contents of the said circular is reproduced as under:

1. Kind reference is drawn to Notification No. 68/2017-Customs (N.T.) dated 30.06.2017, notifying Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017.

2. As per sub-rule (2) of rule 5 of Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017, an importer in order to avail exemption provided vide notification issued under sub-section (1) of section 25 of the Customs Act is required to submit such surety or security as deemed appropriate by the Deputy Commissioner of Customs or Assistant Commissioner of Customs having jurisdiction over the premises where the imported goods shall be put to use for manufacture of goods or for rendering output services.

State Government Yield Spreads – Do Fiscal Metrics Matter?

08-Dec-2017: The Reserve Bank of India today placed on its website the eighth release under the series ‘Mint Street Memos (MSM)’ titled “State Government Yield Spreads – Do Fiscal Metrics Matter?”.

The paper authored by Seema Saggar, Rahul T and Madhusudan Adki from Internal Debt Management Department analyses the causes of spreads of State Development Loans (SDLs) relative to the yields of central government securities of corresponding maturity.

Spreads of state development loans (SDLs) relative to the yields of central government securities of corresponding maturity appear to be caused by illiquidity and prevailing market conditions. Nevertheless, inter-state variations are hardly observed in market pricing of the loans in primary auctions. This presents little market incentives for state governments to improve their fiscal positions and lower their debt.

[MCA] The Companies (Cost Records And Audit) Amendment Rules, 2017 - Notified

Ministry of Corporate Affairs, in exercise of the powers conferred by sub-sections (1) and (2) of section 469 and section 148 of the Companies Act, 2013, has made and notified the Companies (cost records and audit) Amendment Rules, 2017, in its notification dated 7th December 2017, further to amend the Companies (cost records and audit) Rules, 2014.

The Companies (Cost Records and Audit) Amendment Rules, 2017 - download here

IBBI (Grievance And Complaint Handling Procedure) Regulations, 2017 - Notified

1. The Insolvency and Bankruptcy Board of India (IBBI) has notified the IBBI (Grievance and Complaint Handling Procedure) Regulations, 2017 in the Gazette of India(Notification No. IBBI/2017-18/GN/REG/21) on 7th December, 2017. The regulations enable a stakeholder, namely, debtor, creditor, claimant, service provider, resolution applicant or any other person having an interest in an insolvency resolution, liquidation, voluntary liquidation or bankruptcy transaction under the Insolvency and Bankruptcy Code, 2016 (Code), to file a grievance or a complaint against a service provider, namely, insolvency professional agency, insolvency professional, insolvency professional entity or information utility. The regulations provide for an objective and transparent procedure for disposal of grievances and complaints by the IBBI, that does not spare a mischievous service provider, but does not harass an innocent service provider.

Income Tax Department Suspends An Officer For Harassing The Taxpayer

08-Dec-2017: A complaint was received making serious allegations against Shri D. K. Meena, Deputy Commissioner of Income Tax, posted at Surendranagar in Gujarat Region for harassing a taxpayer in a scrutiny case with malafide intention.

The officer was alleged to have demanded illegal gratification through the taxpayer’s Chartered Accountant for favourably completing the assessment. The audio recordings of conversations were also received which, inter alia, mention the bribe amount being demanded by the officers of the Department for settling the case.

CBDT Extends Date Till 31st March, 2018 For Linking Of Aadhaar With PAN

08-Dec-2017: Under the provisions of recently introduced section 139AA of the Income-tax Act, 1961 (the Act), with effect from 01.07.2017, all taxpayers having Aadhaar Number or Enrolment Number are required to link the same with Permanent Account Number (PAN).

In view of the difficulties faced by some of the taxpayers in the process, the date for linking of Aadhaar with PAN was initially extended till 31st August, 2017 which was further extended upto 31st December, 2017.

It has come to notice that some of the taxpayers have not yet completed the linking of PAN with Aadhaar. Therefore, to facilitate the process of linking, it has been decided to further extend the time for linking of Aadhaar with PAN till 31.03.2018.

Consultation Paper On Permitting Mutual Funds & Portfolio Managers To Participate In Commodity Derivatives Market

SEBI, 07-Dec-2017: The objective of the consultation paper is to seek comments / views from the public on the proposal of permitting Mutual Funds (MFs) and Portfolio Managers (PMs), who are authorized under an agreement to invest on behalf of their clients, for participation in exchange traded commodity derivatives and to determine an ideal regulatory framework for the proposal.

The above mentioned Consultation paper is available at SEBI site - download here

Comments from public are invited on the proposal contained in this paper, latest by December 31, 2017. The comments regarding Mutual Funds may be sent by email to mfcomments@sebi.gov.in and the comments regarding Portfolio Managers may be sent to pms@sebi.gov.in.

Relaxation Under Rule 33(1) Of Legal Metrology (Packaged Commodities) Rules, 2011 i.r.o. Single Brand Retail Trading Entities

Department of Consumer Affairs, Legal Metrology Division, Order dated 4th December, 2017:- In exercise of the powers conferred by rule 33(1) of the Legal Metrology (Packaged Commodities) Rules, 2011, in respect of Single Brand retail trading entities the Central Government hereby relaxes the manner of declaration of the retail sale price for a period of one year from the date of this order, in the following manner and subject to the conditions mentioned thereunder.

Release Of Mid-Term Review Of Foreign Trade Policy 2015-2020 – Annual Incentives Increased By 2% Amounting To Over Rs. 8k Crores For Labour Intensive/MSME Sectors

05-Dec-2017: The Minister of Commerce and Industry, Shri Suresh Prabhu released the much awaited Mid-term Review of the Foreign Trade Policy (FTP) 2015-20 today in New Delhi.

The review was released in the presence of the Minister of State for Commerce and Industry, Shri CR Chaudhary, Finance Secretary, Shri Hasmukh Adhia, Commerce Secretary, Smt. Rita Teaotia, Secretary Department of Industrial Policy & Promotion, Shri Ramesh Abhishek and the Director General of Foreign Trade, Shri Alok Chaturvedi.
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