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Controversial surcharge on Foreign Portfolio Investors withdrawn But increased surcharge will apply to those earning over ₹2 crore a year Violations of CSR rules will not be treated as criminal offences Govt. will front-load ₹70,000 crore of capital infusion in public banks
The government on Friday came out on the front foot to try to boost private sector sentiments, with Finance Minister Nirmala Sitharaman announcing a slew of measures to reduce the burden on the sector, including withdrawing the controversial surcharge on Foreign Portfolio Investors (FPIs) and reiterating the Prime Minister’s statement that the government “respects all wealth creators”.
Ms. Sitharaman told a press conference that the government would not treat corporate social responsibility violations as criminal offences, as it had earlier said.
“In order to encourage investment in the capital market, it has been decided to withdraw the enhanced surcharge levied by the Finance (No 2) Act, 2019, on long- and short-term capital gains arising from the transfer of equity shares,” the Minister announced. “In other words, the enhanced surcharge on FPIs goes and the pre-Budget position is restored.”
She, however, clarified that the increased surcharge announced in the Budget would still apply to high net-worth individuals earning more than ₹2 crore a year. This, she said, would be the case till India’s 75th Independence Day, when the decision would be reviewed.
In keeping with the overall push to allay private sector concerns, the Minister also stressed that the government was in favour of penalties rather than prosecution. This would extend to violations of the CSR rules, which it had earlier said could attract a jail term of up to three years along with a fine. The decision had spooked India Inc, and the roll-back should come as a relief.
The government also decided to front-load the ₹70,000 crore of capital infusion in public sector banks that was announced in the Budget, a move that is further aimed at increasing private investment by facilitating greater credit disbursal by the banks. According to the government, this ₹70,000 crore will lead to about ₹5 lakh crore of fresh liquidity that can be loaned out.
In what amounts to a short-term bailout of the auto industry, Ms. Sitharaman announced that the government had rescinded its ban on the purchase of new vehicles by its departments to replace old ones. Vehicles bought till March 31, 2020, will also be eligible for an additional 15% depreciation. The proposal to enhance registration fees for new vehicles will be kept on hold till June 2020.
The government has also significantly reined in the discretionary powers of the tax authorities. Ms. Sitharaman announced that from October 1, all notices and summons by the Income Tax Department would be generated by a centralised computer and would carry a unique code.
Any notices not carrying these codes would be considered invalid, and all pending notices would either have to be disposed of by October 1 or reissued with the unique code.
“I have also held meetings with the tax officials at various locations in the country and told them that our tax collection targets are realistic and that there is no need for overreach,” Ms. Sitharaman said.
Repo rate-linked loans
The Finance Minister did not restrict her efforts to boost the economy to just the private sector. In what should be welcomed by borrowers across the board, including those looking for home and auto loans, she announced that public sector banks have decided to increase their repo rate-linked loan offerings.
A major complaint among end-consumers has been that the Reserve Bank of India’s repo rate cuts have not been transmitted onwards by the banks. Repo rate-linked loan products will effectively take the banks out of the rate-setting process.
What should also cheer prospective homeowners is that the government has announced an additional ₹20,000 crore of liquidity to the housing finance companies, over and above the ₹10,000 crore earlier announced.
Rahman is currently posted in Punjab
An assistant sub-inspector of the Border Security Force (BSF) and his wife have been declared “foreigners” by a Foreigners’ Tribunal in eastern Assam’s Jorhat town.
The citizenship of the officer’s parents and his siblings are, however, not in doubt. The family is based in Golaghat district’s Udaypur-Mikirpatty close to the Assam-Nagaland border.
The tribunal declared Muzibur Rahman and his wife as non-Indians in an ex parte judgment in July.
Mr. Rahman, currently posted in Punjab, came to know of the judgment against him when he came home on leave in July last week. He said the Assam police's border wing had relied on a ‘drunkard’s account’ to submit a report to the tribunal against him.
The border wing, established in 1962 to initially prevent infiltration of Pakistanis, is tasked with detection and deportation of foreigners. Currently, 100 Foreigners’ Tribunals decide the fate of such “foreigners” referred by this wing. “We have land documents of 1923. It is a pity that a genuine Indian citizen has been made a foreigner on the basis of a drunkard’s feedback. My family did not receive the tribunal’s notice. The chief of our village also did not inform me,” Mr. Rahman said, adding that he had approached the Gauhati High Court.
Protection from arrest till Aug. 26
The Supreme Court on Friday protected former Union Finance Minister P. Chidambaram from arrest by the Enforcement Directorate (ED) till August 26, the next date of hearing.
The ED is investigating the charges of money laundering against him in connection with the INX Media case.
“He already had the benefit of interim bail in the ED matter. He was also questioned in this case. He will continue to get protection,” Justice R. Banumathi, leading a Bench comprising Justice A.S. Bopanna, observed.
The interim protection was granted, despite repeated exhortations from Solicitor General Tushar Mehta to the Bench that “Your Lordships’ conscience should be satisfied before giving him any protection.”
Mr. Mehta even voiced the apprehension that the interim relief would be “misused” in the remand proceedings due on Monday in the CBI court against Mr. Chidambaram.
The court refused to take a sealed envelope proffered by Mr. Mehta, appearing for the CBI and the ED, which he said contained crucial evidence against Mr. Chidambaram.
The Bench was hearing two separate appeals filed by Mr. Chidambaram on August 20, within hours of the Delhi High Court refusing him anticipatory bail.
Six Lashkar-e-Taiba suspects believed to have intruded into Tamil Nadu
Alert sounded: Coastal Security Group personnel patrolling the waters off Thoothukudi on Friday. N. RajeshThe Hindu
Massive surveillance has been mounted across Tamil Nadu, especially in Coimbatore, following an intelligence input that six suspected terrorists of the Lashkar-e-Taiba (LeT), including five Tamil Muslims from Sri Lanka and a possible Pakistan national, have intruded into Tamil Nadu.
The coastal areas, too, came under heightened surveillance with the police asking fishermen to tip them off on the movement of suspicious persons.
Last seen on August 21
The suspected terrorists were reportedly last seen in Coimbatore on the evening of August 21, the alert said, adding that one of them had been identified as Illyas Anwar, believed to be of Pakistan origin. The LeT operatives were assisted by a native of Kerala, employed in Bahrain but untraceable. A resident of Thrissur, the suspect was helping them with logistics and creating a base.
A senior government official in New Delhi said they had zeroed in on the suspect. It is not clear whether he has been arrested.
“The specific information came from intelligence agencies here; we are working on the leads,” said the official.
Though initially a photo of the suspected Kerala man was circulated on mobile messaging platforms by some police personnel, Director General of Police J.K. Tripathy, talking to journalists in Chennai, denied any such photograph had been released officially.
Additional DGP (Law and Order) Jayanth Murali arrived in Coimbatore on Friday morning to take stock of the security situation and held discussions with senior police officers. The Hindu had on Friday reported on the intelligence alert and the heightened security in Coimbatore.
The intelligence communication listed five possible targets for attacks: the Velankanni shrine in Nagapattinam; the Defence Services Staff College (DSSC) in Wellington, Udhagamandalam; the Air Force Station in Sulur, Coimbatore; the Sabarimala shrine in Kerala; and “any other communally sensitive” target.
Rain in onion-growing States causes concern about hike in prices
Action has been taken to increase supply, an official said. file photo
With onion supplies falling prey to hoarders and profiteers at entry points to Delhi, the Union government has asked the police from all the neighbouring States to take action to prevent artificial shortage in the Capital.
The issue was raised at a meeting called to review the prices of essential commodities such as onions, pulses and oilseeds under the chairmanship of Consumer Affairs Secretary Avinash K. Srivastava here on Friday. Officials from the Intelligence Bureau and the Enforcement Directorate attended the meeting, along with police representatives from Delhi, Uttar Pradesh, Rajasthan and Haryana, Ministry officials said.
“We have already taken action to increase the supply of onions in the market, but we have received reports that supplies are being held up at the border by certain traders, hoarders and profiteers,” a senior official told The Hindu. “As this is an inter-State issue, we have asked police officers from all neighbouring States to create a common database for more effective enforcement.”
Police from all neighbouring States have been asked to hold regular meetings with each other and ensure seamless checks on hoarding both within the Capital and in other States, as well as at entry points along the border, said an official statement.
Heavy rain in key onion-growing States such as Maharashtra and Karnataka have caused concerns about a hike in prices of the kitchen staple.
On Wednesday, the Consumer Affairs Department had directed Mother Dairy to put a ₹23.90 per kg cap on onion prices at its Safal shops and took efforts to increase supply of the vegetable in the market.
On Friday, the committee decided to further increase the daily supply of onions from the government buffer stock and directed NAFED to release stock from the Price Stabilisation Fund into the market to ensure improved availability at reasonable rates.