Prime Minister Narendra Modi today said the government has initiated a series of banking reforms including re-capitalisation of PSU banks, change in rules for hiring top management and paper-less transactions to curb the black money menace. The Prime Minister said the entire banking sector is undergoing major transformation with the advent of latest technology. "The banking sector is seeing changes. Mobile banking is coming up. Banking will be premises-less and paper-less," he said at the launch of IDFC Bank here. Modi further said India is slowly moving towards a situation where the currency printing cost will come down. "We have to take the country in that direction. As we use technology, we move to paper-less banking, currency-less business operations; the possibility of black money will gradually become negligible," he said. He also stressed the need for banks to focus on rural areas as they have immense potential.
October 16, 2015
Money Laundering Scams
The Enforcement Directorate has unearthed one more forex scam. This time it involves a total of 7 banks including Oriental Bank of Commerce, Axis Bank, ICICI, IndusInd, Kotak Mahindra, DCB, Dhanalaxmi Bank and YES Bank.
The ED has arrested one Manish Jain under the Prevention of Money Laundering Scam. Jain transferred more than Rs 500 crore through 70 fake bank accounts.
Jain was also sending money in the garb of imports and exports. He used to send money to Hong Kong in HSBC Bank and further to China. The money was remitted out of India illegally against the imports which actually never took place.
Involvement of six more banks in this case has come to the notice. Jain was running this racket since 2006. The matter was referred to the ED by Directorate of Revenue Intelligence (DRI).
ED has conducted searches in various locations, which resulted in recovery and seizure of incriminating documents and material.
Other banks, involving a foreign bank, are on the ED radar. ED has been able to track atleast Rs 6000-7000 crore worth of transaction already.
Scam After Scam In Banks
Only a few days ago we came to know Rs.6000 crore forex fraud in which huge amount of Indian money has allegedly been remitted to foreign banks in the name of various fake companies and that through Bank of Baroda branch situated in Delhi. It is also informed that 32 banks were indirectly involved in such remittances .None of banks could detect it and if detected , none of them had courage to point it out or reveal the face to RBI and Government of India. this is India where telling truth is treated a crime and person who is indulged in crime gets appreciation, promotion and elevation from all . This is why fraud cases go unnoticed
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Another fraud of bill discounting came to light in the same fortnight when fake bills or say accommodation bills have been discounted by one of branches of Bank of Baroda and it is now difficult to recover Rs.350 crore from the company which committed fraud with bank.
Latest news is that The Enforcement Directorate has unearthed one more forex scam. This time it involves a total of 7 banks including Oriental Bank of Commerce , Axis Bank , ICICI , IndusInd , Kotak Mahindra , DCB , Dhanalaxmi Bank. The ED has arrested one Manish Jain under the Prevention of Money Laundering Scam. Jain transferred more than Rs 500 crore through 70 fake bank accounts. Jain was also sending money in the garb of imports and exports. He used to send money to Hong Kong in HSBC Bank and further to China. The money was remitted out of India illegally against the imports which actually never took place.
Last year also fraud through remittances involving many bank amounting to Rs.150000 crore was unearthed. We are also aware of global forex scam involving Rs.36000 crore of rupees.
In last year we came across so many cases of bribe led lending, creation of term deposit by illegal withdrawal of huge fund fro government accounts, cases of submitting fake fixed deposit receipts, cases of lending based on fake title deed etc .
We all know that all buy and sell of real estate properties take place with the help of black money and we all know how huge amount of stamp duty is thus saved by buyer and seller of properties in addition to using ill earned money called as black money to convert into white money.
Inspite of all guidelines on KYC , thousands of fake accounts are opened daily, thousands of fake companies are registered daily with Registrar of Companies and hundreds of ways are used to save taxes with the help of Chartered Accountants and tax officials. Without the help of bankers, government officials and CAs , creation of fake companies, opening of fake accounts and remittances to fake companies abroad or evasion of taxes is not possible.
We also remember how Harshad Mehta during eighties cheated banks , almost all big banks by submitting fake receipts of hundreds of crores of rupees. We also remember stock scam committed by Ketan Parekh.
We also remember LIC housing loan scam unearthed in nineties. We know how management of bank use window dressing to inflate deposits and advances and how they book artificial recovery to get appreciation from Ministry of Finance . It is also an open secret that banking channels have been used for decades to remit black money to foreign countries.
We have seen how weakness of many public sector banks due to load of bad loans have gone beyond the control of RBI and GOI. We also know how the tool of restructure and ever greening have been used largely by banks to conceal their bad loans. We also know how lacs of crore of rupees have been sacrificed by banks in write off of loans and write off of fraud oriented losses. If all losses are added together, the total volume will perhaps exceed total of all other frauds occurred in free India.
All politicians know it and almost all of them use this illegal money to enhance their political fate. Government of India always come out with a guideline after an exposure of each scam , RBI threaten to take punitive action against erring officials , committees are set up to look into the matter and so on.
But on real ground level, no improvement has ever taken place. The culture of fraud , culture of submission of false certification of good health and compliance of laws, culture of flattery , culture of bribery and culture of protecting evil persons and awarding good workers has become the lifeline and accepted norms of the system.
God knows when and how there will be change in culture and real improvement in health of banks. I know that if there is a will there is a way. Until there is a strong desire in the minds of rulers it is not possible to visualise any drastic change in the system in short run.
October 3, 2015
New Income Tax rules regarding form 15G and 15H
New Income Tax rules regarding form 15G and 15H
CBDT has notified the new Income Tax rules regarding form 15G and 15H.Under revised rules few conditions regarding submission Form 15G & 15H has been relaxed. As per new rules an eligible person may file form 15G and 15H in paper as well as in electronic mode. This is an enabling provision under the act, and you may file online 15G and 15H after deductor like banks provide such facility on their online websites to their customers so that customers may furnish Form 15G /Form 15H.It may take some time as CBDT has not given sufficient time for making changes in system.
Further, now no need to submit physical copy to Income tax office by deductor also. Till September, 2015 all the declarations received during the month were required to be submitted to within 7 days to office of the commissioner/Assistant commissioner having jurisdiction to that office. Now Declarations received in October will not be required to be sent in November,2015 and this will save wastage of papers.
The new Forms and Procedure have following main features .The revised procedure shall be effective from the 1st day of October, 2015.
For person seeking non deduction/Deductee/Income receiver Eligible Deductee may file form 15G/15H in paper (in duplicate- one copy for acknowledgement) or electronically.
· Pan is must to submit form 15G/15H.
· Only Resident can submit form 15G/15H
In form 15G /15H person have to provide details of Income for which form 15G/15H has already been submitted. For person accepting the Form 15G/15H/Deductor /Payee, he should check whether person providing the form is eligible to submit form or not according to particulars submitted by the person ( This is major responsibility to check the details furnished by the person ) .Pan number is to be verified.( PAN is required to be checked by the deductor) . Deductor/payee after verification shall issue a Unique identification number on form 15G/15H .UIN should be separate for each type of form. The forms received in a particular quarter is required to be reported in quarterly ETDS return even if there is no deduction in that quarter.( Branches were not raising flag where form 15G/H were given and now this will be must)
No need to submit physical copy of form 15G/15H to income tax department. Deductor shall retain the form 15G/15H for seven years.( Proper filing will be needed up to 7 years and Bank should instruct not to destroy these form till the end of 7 years ) Income Tax department has issued a Press release on the subject as under Subject: Simplification of procedure for Form No.15G & 15H – regarding
Tax payers seeking non deduction of tax from certain incomes are required to file a self declaration in Form No. 15G or Form No.15H as per the provisions of Section 197A of the Income-tax Act, 1961 (‘the Act’). In order to reduce the cost of compliance and ease the compliance burden for both, the tax payer and the tax deductor, the Central Board of Direct taxes has simplified the format and procedure for self declaration of Form No.15G or 15H. The procedure for submission of the Forms by the deductor has also been simplified.
Under the simplified procedure, a payee can submit the self-declaration either in paper form or electronically. The deductor will not deduct tax and will allot a Unique Identification Number (UIN) to all self-declarations in accordance with a well laid down procedure to be specified separately. The particulars of self declarations will have to be furnished by the deductor along with UIN in the quarterly TDS statements. The requirement of submitting physical copy of Form 15G and 15H by the deductor to the income-tax authorities has been dispensed with. The deductor will, however be required to retain Form No.15G and 15H for seven years.
The revised procedure shall be effective from the 1st day of October, 2015.
FAQ
What is Form 15H & 15G ?
Form 15G-15H and Income Tax forms which required to be submitted by Specified person earning a specified income to payer for Non deduction of tax at source.
Who can submit form 15G ?
First and foremost only a person who is resident in India can submit form No. 15G. So an NRI cannot submit this form. Any person other than a Company/Firm can submit form No. 15 G. So any Individual and HUF can submit form No. 15G.( Person does not means an individual but it it is defined otherwise)
However it is not that every Individual or HUF can submit form No. 15G. Only the individual or HUF, whose tax on the estimated income for the year is nil and the amount of interest income from all the sources does not exceed the minimum exemption limit, can submit this form.( Read carefully that there are 2 conditions)
So for being eligible for you to submit this form, you need to satisfy both the above conditions. In a situation where due to various deductions the tax payable on total income may be nil but if the total amount of interest income is expected to exceed Rs. 2.50 lakh then you cannot submit this form.
Who can submit form 15H?
Any resident Individual who is sixty years and above of age or completes sixty years during the financial year can submit form No. 15H provided his tax liability on the basis of his estimated income is nil for the financial year though the total amount of interest from all sources may exceed Rs. 3 lacs, the minimum amount liable for tax. So only senior citizens can submit this form. HUF cannot file this despite Karta may be a senior citizen.
What type of Income/sections under which Form 15G & 15H can be given?
Following sections/type of Income under which eligible person may submit form 15G /15H: Mainly these forms are furnished to non deduction of TDS by Banks/Other person on payment of Interest
Section 193 -Interest from Securities -Like eligible Govt /PSU bonds etc
Section 194-Dividends -Dividend from shares etc (presently exempted on receipt)
Section 194A-Interest other than securities -Like interest from Fixed deposit/from loan to other person
Section 194EE -Nation saving scheme (NSS)
Section 194DA: payment of Taxable Insurance maturity amount
Whether a Person without pan can submit Form 15G/15H ?
No, If person does not have Pan then he cannot submit form 15G and 15H and Tax shall be deducted on higher rate under section 206AA .Further if he has not submitted his pan on form 15G /15H or submitted wrong /incorrect pan on 15G /15H then also section 206AA higher TDS rate of 20% applicable.( Bank should check the correctness of PAN while accepting it)
Whether Non-resident person can submit form 15G/15H ?
NO
I do not have new form 15G or 15H. From where I may get it?
The form in word file are attached with sufficient number of column to accommodate number of receipts/RD accounts. Since the format is in word file, you may increase the columns.
September 8, 2015
Entry-level salaries in India are amongst the lowest in the Asia Pacific region
NEW DELHI: Entry-level salaries in India are amongst the lowest in the Asia Pacific region, a study by professional services firm Towers Watson says.
The average monthly starting pay in India is around US $400 (Rs 24,000), less than one-fifth of the equivalent paid in South Korea and Singapore, said the study by Towers Watson's Data Services.
Graduate Indian employees sit towards the bottom of the Asia Pacific countries in terms of starting salary, it said, adding that it augurs well for the 'Make in India' campaign as this would give the MNCs a competitive advantage over other Asia-Pac countries.
"Although dependent on prevailing exchange rates, the findings clearly highlight India's position as a competitive and attractive workforce and talent market," said Sambhav Rakyan, Data Services Practice Leader, Asia Pacific at Towers Watson.
Out of the top 11 Asia Pacific economies, the average monthly Indian starting salary was ranked ninth.
"The disparity in salaries also illustrates how a large knowledge pool and a significant cost arbitrage makes India a front runner in providing outsourced services. After achieving great success in IT/BPO, India can now become a natural choice for other sectors, like manufacturing," he added.
Further up the ladder, wages for experienced professionals at middle management levels in India are slightly more competitive, but still below their Asia Pacific peers.
Notwithstanding the recent push in its manufacturing sector and popularity of the IT sector, an engineering manager in India earns an average salary of USD 56,530 - almost half of his Chinese counterpart (US $112,070) and one-third of his Singaporean counterpart (US $151,168), the report said.
"Despite a common labour market in the region, it is striking to see how divergent guaranteed cash levels remain amongst top economies," Rakyan added.
