The Lok Sabha passed the Finance Bill, 2018, with 21 amendments, some of
which had to do with the controversial long-term capital gains tax on equity
announced in the Budget speech by Finance Minister ArunJaitley and tax
exemptions for start-ups.
The Bill was passed without discussion amid ruckus, following which both
Houses of Parliament were adjourned for the day.
Regarding the long-term capital gains (LTCG) tax, one of the major
amendments made was that the grandfathering of gains till January 31, 2018
will now be incorporated in the computation of the gains itself, rather than
for the purposes of computing tax at the rate of 10%.
“This resolves the ambiguity contained in the language of the Finance
Bill, 2018, on the need for a duplicated computation, viz. first for
computing LTCG without grandfathering and then for applying 10% tax rate
with grandfathering,” Rajiv Chugh, Tax Partner at EY India, said in a note.
The amended Finance Bill, 2018 clears the air on several ambiguities and
anomalies on the new LTCG regime.
Cost base for depreciation allowance on stock in trade converted into
capital asset, valuation of securities held as inventory by scheduled banks
and public financial institutions.
Due date for CbCR (country by country reporting) compliance by Indian
constituent entity of non-resident parent entity and turnover cap for
However, tax experts say that ambiguities on other proposals continue to
exist, such as the deemed dividend taxation of accumulated profits of an
Potential extension of SEP to physical transactions, applicability
of prosecution for non-filing of returns of income to foreign companies
whose incomes are fully covered by withholding tax, and restrictive relief
from minimum alternate tax (MAT) for non-resident companies under
presumptive basis of taxation.
The amended Finance Act also made changes to the rules regarding how
start-ups can avail of tax deductions on profits.
Previously, start-ups were allowed 100% deduction of profits for any
three out of seven years from the year of incorporation.
To avail of this incentive, the start-ups were required to comply with a
condition that stipulated that their turnover could not exceed Rs. 25 crore
in those seven years.
ASICS Ranking for 2017, Pune tops
The Annual Survey of India’s City-Systems (ASICS) 2017, which uses 150
parameters to judge 23 cities, has placed Pune at the top and Bengaluru at
the bottom of the rankings.
While Pune scored 5.1 out of a maximum score of 10, Bengaluru got just
3. But Indian cities lagged behind global cities like New York and London,
which scored 8.8.
The survey, carried out by the NGO Janaagraha Centre for Citizenship and
Democracy, was released.
It broadly looks at urban planning and design, capacity and resources of
Urban Local Bodies, the degree of empowerment of the civic body, and
processes for transparency and citizen participation.
Cities such as Surat and Ahmedabad moved up the rankings by 12 and seven
positions respectively from 2016.
Bhubaneshwar moved up by six spots, while Chennai dropped by 11 places.
Bengaluru was down seven places.
While financial management has improved in some cities, there has been
little progress in devolution of powers to civic bodies.
Just three out of the 23 cities enacted town planning legislations since
economic liberalisation in 1991, while the rest rely on laws enacted nearly
six decades ago.
Consequently, notes the report, local bodies suffer from fragmented
governance. On average, Indian cities score 4.9 on this parameter.
Their municipal commissioners had an average tenure of only 10 months.
On the other hand, London, where the mayor is elected for five years and has
far-reaching powers, scores 9.8.
Environmental nod for Neutrino project
The India-based Neutrino Observatory (INO) project has got a fresh lease
of life with the Ministry of Environment and Forests (MoEF) taking it up as
a special case and granting it environmental clearance to set up the lab in
Bodi West hills.
MoEF’s Expert Appraisal Committee (Infra 2), after detailed
deliberations on the proposal and submissions by the project proponent,
recommended this at its meeting on March 5.
According to the minutes of the meeting available in the public domain,
the EAC was given to understand that though the proposals were not within
its scope, the Ministry wanted it to consider this as a special case.
The panel was informed that there was no scope for radioactivity and
leaching of water and these have been explained to the courts.
The project proponents clarified that studies showed there would be no
impact of blasting on any habitation in the vicinity.
During the panel’s deliberations, an expert from the Defence Research
and Development Organisation (DRDO) was present.
While granting EC, the committee stipulated specific conditions, of
which two are key for the project to take off.
One is the consent to establish and operate to be obtained from the
Tamil Nadu Pollution Control Board (TNPCB). In the past, INO project
proponents had complained that the TNPCB had been sitting on the file for
years without taking any action when Jayalalithaa was Chief Minister
Also, the INO team has to obtain the necessary forest and National Board
for Wild Life clearances as per law. The Mathikettan Shola National Park in
Idukki district, Kerala, is situated within five km from the project site.
When the project was considered by the Tamil Nadu State Expert Appraisal
Committee in November 2017 (after Jayalalithaa’s death), it said that the
proposed site forms part of the catchment area of various streams that
contribute to the Vaigai watershed.
Don’t sell land leases to other industries, Assam warns Tea estates
The Assam government warned tea estates against selling land leased out
to them, but said planters may be allowed to diversify by using such land
for other industries.
There had been reports of major tea estates and small tea growers
selling leased land. Officials said about 20% of 3,07,080 hectares of land
under tea plantation had been leased out by the government over the years.
Illegal sale of land was one of the factors why the government had last
year toyed with the idea of de-leasing an acre of land in each of 792
registered tea estates for setting up schools. Another factor was the estate
management’s indifference to a request for land to set up high schools for
tea plantation workers.
Tea estate owners were unhappy with the State government for not heeding
their plea to increase the lease period to 10 years from one year now.
British Prime Minister Theresa May said that her government will suspend
all high-level bilateral contacts with Russia over the poisoning of Sergei
Skripal, the former Russian double agent.
No Ministers or members of the Royal Family will attend the Summer World
Cup in Russia, Ms. May told the House of Commons.
The government has also decided to expel 23 Russian diplomats and
withdraw an invitation to Russian Foreign Minister Sergei Lavrov to visit
the country. The diplomats to be expelled were identified as “undeclared
Ms. May’s announcement came ahead of an urgent session of the UN
Security Council to be held at Britain’s behest to discuss the poisoning.
The comments also came after a deadline, set by Britain for an
“explanation” from Russia as to why Novichok — a military-grade nerve agent
developed by Russia — had come to be used in the Salisbury poisoning,
Earlier this week Ms. May told the House it was “highly likely” that the
Russian state was involved in the poisonings.
The Russian Embassy in London condemned the decision to expel its
diplomats as a “hostile action” that was “total unacceptable, unjustified
India’s position is understood to be that while it strongly condemns the
action on British soil, it hopes that the issue is dealt with through
dialogue between Britain and Russia.
Using existing powers, checks would also increase on private flights,
customs and freight, and Russian assets could be frozen if there was
evidence that they could be used to threaten the life or property of U.K.
nationals or residents.
However, Ms. May did not refer to questions about the future of RT U.K.
Earlier this week, regulator Ofcom said it would reconsider the status RT’s
licence, because ANO TV Novosti, the holder of its licence, was financed
from a budget of Russia.
Russia has also warned that it would take retaliatory action against the
operation of British media in Russia if action against RT were taken in
India will see 7.3% Growth in FY19: WB
The World Bank forecasts India’s economic growth will accelerate to 7.3%
in 2018-19, from 6.7% in the current financial year, before gathering
momentum to a 7.5% pace in 2019-20.
The Central Statistics Office has projected GDP growth for the 12 months
ending March 31, at 6.6%.
“The key takeaways about the Indian economy are that it is steadily
growing, and it is growth where volatility has significantly decreased,”
Junaid Ahmed, World Bank Country Director of India, said.
“Growth is not being led by any single factor, and is instead being
driven by a number of factors such as exports, consumption, and investment.”
“Another highlight is the resilience,” he said. “Despite shocks such as
the implementation of the Goods and Services Tax, and demonetisation, the
growth path is back on trend.”
The bank’s India Development Update divides India’s economic growth
history into four segments.
The first is from 1970 to 1990, when the economy maintained an average
growth rate of 4.4%.
This subsequently accelerated in the 1991-2003 period to an average of
5.4%. Thereafter, growth accelerated sharply for a short period from 2004 to
2008, where it averaged 8.8%, which then slowed down to a “still impressive”
average of 7.1% in the 2009-17 period.
“If we were to ask what it could take to reach a sustainable 8% growth
trajectory, then our only example would be to look at the 2004-08 period,”
Ms. Gupta said.
“Durable revival in private investments and exports would be crucial for
India achieving a sustained high growth of 8% and above.”
The report highlights several challenges facing the Indian economy that
need prioritised attention.
These include the poor state of private sector investments which need to
be enhanced through measures “that assure a favourable investment climate
while reducing policy uncertainty”.
“Reviving bank credit to support growth is critically important,” the
“Implementation of the new Insolvency and Bankruptcy Code is an
important step towards improving credit behaviour.
However, the policy may take time to be effective in cleaning the balance
sheets,” the bank said.
Urea subsidy scheme to continue till 2020
The Cabinet approved the proposal by the Department of Fertilizers to
continue the ongoing Urea Subsidy Scheme from 2017 to 2020.
The estimated cost of this would be Rs. 1,64,935 crore, the government
said. “The continuation of the urea subsidy scheme will ensure that adequate
quantity of urea is made available to the farmers at statutory controlled
price,” the government said in a release.
The DBT mechanism would entail 100% of the payment going to fertiliser
companies on the sale of fertilisers to farmers at subsidised rates.
Inflation based upon WPI reached seven months low
Inflation based on wholesale prices eased to a seven-month low of 2.48%
in February on cheaper food articles, including vegetables.
On the basis of Wholesale Price Index (WPI), inflation was 2.84% in
January and 5.51% in February 2017. WPI inflation at 2.48% in February is
the lowest in seven months. The previous low level was recorded in July at
According to government data, inflation in food articles slowed to 0.88%
in February from 3% in the preceding month.
Inflation in vegetables softened with annual inflation at 15.26% as
against 40.77%in January. While the rate of price rise in onion slowed, it
increased in the case of another kitchen essential, potato.
Stephen Hawking dies
Stephen W. Hawking, the Cambridge University physicist and best-selling
author who roamed the cosmos from a wheelchair, pondering the nature of
gravity and the origin of the universe and becoming an emblem of human
determination and curiosity, has died at his home in Cambridge, England. He
His death was confirmed by a spokesman for Cambridge University.
“Not since Albert Einstein has a scientist so captured the public
imagination and endeared himself to tens of millions of people around the
world,” MichioKaku, a professor of theoretical physics at the City
University of New York, said.
Hawking did that largely through his book A Brief History of Time: From
the Big Bang to Black Holes , published in 1988. It has sold over 10 million
The 2014 film about his life, The Theory of Everything , was nominated
for several Academy Awards, and Eddie Redmayne, who played Hawking, won the
Scientifically, Hawking will be best remembered for a discovery so
strange that it might be expressed in the form of a Zen koan: When is a
black hole not black? When it explodes.
What is equally amazing is that he had a career at all.
As a graduate student in 1963, he learned he had amyotrophic lateral
sclerosis, a neuromuscular wasting disease also known as Lou Gehrig’s
disease.He was given only a few years to live.