Kharge rejects Finance ministry's 'advice'

Kharge rejects Finance ministry's 'advice'

Bangalore, Sep 18 (UNI) Union Labour Minister Mallikarjuna Kharge today said his Ministry will not heed to the 'advice' made by the Finance Ministry to invest 15 per cent of the funds in the Provident Fund account in stock market.

At present, only five per cent of the Rs 3,00,000 crore in the fund is being invested in the equity market under the strict advice of the financial consultants hired by the Employees Provident Fund Organisation (EPFO).

Speaking to UNI, Mr Kharge, who is the Chairman of the Central Board of Trustees of the EPFO, said safety of the PF funds will be of paramount importance for his ministry and the organisation would continue to invest only in recognised institutions like RBI, SBI, public sector units and other governmental organisations, which give guarantee of certain percentage of returns.

''We cannot take risk when it comes to the funds saved for years by the employees. PF is their lifetime savings and the only guarantee that will help them lead a comfortable retired life.

''Finance Ministry has asked us to increase the funds placed in open market to 15 per cent. But this will not happen. If the government gives us guarantee for our original capital and the returns in terms of interest or dividend, then we can see. But we cannot play into the hands of the open market'' he stressed.

Source: UNI India

Finance Minister Welcomes RBI’s Monetary Policy for 2010-11

Finance Minister Welcomes RBI’s Monetary Policy for 2010-11 Monetary Policy Measures Complement Finance Ministry’s Policies Aimed at Controlling Inflation and Promoting Sustainable Growth: FM

Finance Minister, Shri Pranab Mukherjee has welcomed the Monetary Policy 2010-11 announced today by the Reserve Bank of India. Finance Minister’s observations on Monetary Policy are as under:

“Earlier today the Governor of the Reserve Bank of India announced a set of new monetary policy measures. The well-balanced measures, which involve raising the repo rate, the reverse repo rate and the CRR by 25 basis points each, reflect a mature and balanced view of the needs of our economy and I fully endorse the measures. They complement well the policies of the Ministry of Finance aimed at controlling inflation and promoting sustainable growth. These policies should have a gentle impact in tightening money in the economy and should dampen further inflationary pressures.

The Reserve Bank of India has made a forecast of inflation of 5.5% for the year 2010-11. Long-run inflation is very difficult to predict and is based on some statistical analysis but also on intuition. My own belief based on analysis done in my ministry is that inflation is now on a downward trajectory and in 2010-11 will be less than 5.5% and, in fact, closer to 4% with an upward bias.

The small tightening of credit and other policy changes are in the right direction. It has to be recalled that these policy rates were lowered in the last two years in order to combat the fall-out of the global recession on the Indian economy. India has now bounced back, with growth seemingly back on track and inflation, though high, on a clear downward trend. Hence, I believe that it is time to move back towards "neutral" policy rates, that is, rates that should prevail when an economy is stable and on track. I view these changes as moves towards normal times.

Inflation is extremely sensitive to the weather condition and how that affects agriculture and agricultural expectations. If nothing untoward happens on the weather front, my belief is that overall inflation has peaked and should be on a downward trajectory from now on. Actually food price inflation has been going down for a while now. The reason why the overall WPI was at the same level in February and March is because there was a slight increase in non-food inflation. Usually when that happens it calls for economy-wide demand tightening and the RBI policy announcement may be viewed as a judicious move towards that.

Some observers may worry that tightening of credit can dampen growth especially in the durable goods sector. But our analysis of industrial growth and credit off-take suggests that there is no reason for such apprehension. In fact these policies will aid sustainable growth.

Let me add that the overall economic scenario in India now looks extremely robust and better than it has any time in the last two years. I congratulate the Governor of the RBI for his able stewardship of monetary policy. It has been very well synchronized with fiscal policy and has played a major role in India’s healthy recovery.”

Tax Deduction at Source on payment of interest on time deposits under Section 194A

CIRCULAR NO- 03/2010.

F.No.275/66/2007-IT (B)
GOVERNMENT OF INDIA
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
*********

New Delhi the the 2nd March, 2010

OFFICE MEMORANDUM

Subject:Tax Deduction at Source on payment of interest on time deposits under Section 194A of the Income Tax Act, 1961 by banks following Core-Branch Banking Solutions (CBS) software – reg.

As per provisions of section 194A of the Income Tax Act 1961, income tax has to be deducted at source at the time of credit of interest income to the account of the payee or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, at the rates in force if such interest amount exceeds specified limit. Further, Explanation to section 194A states that “for the purpose of this section, where any income by way of interest as aforesaid is credited to any account, whether called ‘Interest payable account’ or ‘Suspense Account’ or by any other name, in the books of account of the person liable to pay such income, such crediting shall be deemed to be credit of such income to the account of the payee and the provisions of this section shall apply accordingly”.

2. Representations have been received from Indian Banks Association (IBA) seeking clarification regarding deduction of tax at source from payment of interest on time deposits by banks using Core-Branch Banking Solutions (CBS) software. In case of banks using CBS software, interest payable on time deposits is calculated generally on daily basis or monthly basis and is swept & parked accordingly in the provisioning account for the purposes of macro-monitoring only. However, constructive credit is given to the depositor’s / payee’s account either at the end of the financial year or at periodic intervals as per practice of the bank or as per the depositor’s / payee’s requirement or on maturity or on encashment of time deposits; whichever is earlier.

3. The matter has been considered by the Board. Explanation to section 194A was introduced with effect from 1.4.1987 by the Finance Act, 1987 to plug the loophole of avoiding deduction of tax at source by crediting interest in the books of accounts under accounting heads ‘interest payable account’ or ‘suspense account’ instead of to the depositor’s / payee’s account. Therefore, the Explanation is not meant to apply in cases of banks where credit is made to provisioning account on daily/monthly basis for the purposes of macro monitoring only by the use of CBS software.

4. In view of the above position, it is clarified that since no constructive credit to the depositor’s / payee’s account takes place while calculating interest on time deposits on daily or monthly basis in the CBS software used by banks, tax need not be deducted at source on such provisioning of interest by banks for the purposes of macro monitoring only. In such cases, tax shall be deducted at source on accrual of interest at the end of financial year or at periodic intervals as per practice of the bank or as per the depositor’s / payee’s requirement or on maturity or on encashment of time deposits; whichever event takes place earlier; whenever the aggregate of amounts of interest income credited or paid or likely to be credited or paid during the financial year by the banks exceeds the limits specified in section 194A.

Hindi version to follow.

(Ansuman Pattnaik)
Director (Budget)

Payment of Dearness Allowance to Central Government Employees – Revised rates effective from 1.1.2009

Office Memorandum from Finance Ministry...

1. Dearness allowance payable to Central Government Employees shall be enhanced from the existing of 16% to 22% with effect from first January, 2009.

2. The payment of arrears of D.A. for the months of January and February, 2009 shall not be made before the date of disbursement of salary of March, 2009.

Click to view the O.M. from Finance Ministry

FIXATION OF PAY AS PER 6TH CPC

The clarification from Ministry of finance released on Today

Fitments Tables for given to determined the pay in the pay band corresponding to pre revised pay scale and then corresponding Grade pay get from the column 6 of part B and C.

Click the link and read more details...!

Clearly tell that promotion is the matter of 3% from basic pay plus diffrence between grade pay only.

To see the Govenment Order... Click the link given below

Fixation of Pay

Bonus Order Released For All Central Government Employees

Bonus Order Released For All

BONUS ORDER REVISING CEILING RELEASED TODAY FOR ALL CEILING REVISED AS 3500/= FOR ALL CG EMPLOYEES

CEILING REVISED FOR BOTH PLB AND ADHOC BONUS OFFICIALS,
DOWNLOAD THE ORDER OF THE MINISTRY OF FINANCE - DEPARTMENT OF EXPENDITURE CAN DO SO BY CLICKING ON THE LINK BELOW: Grant of PLB and Ad-hoc Bonus to Central Government Employees - revision of calculation ceiling(Dated - 10.10.2008)

Implementation of Government's decision on the recommendation of the Sixth CPC Revision of provisions regulating pension/gratuity/commutation of pension/family pension/disability pension and ex-gratia lump-sum compensation(Dated - 03.10.2008)

BONUS CEILING ORDER DELAYED

BONUS CEILING ORDER DELAYED

BONUS CEILING REVISION ORDER NOT YET RELEASED

CABINET MEETING MINUTES NOT YET RECEIVED BY MOF

ON RECEIPT OF MINUTES ORDERS WILL BE ISSUED

Confederation Predident clarified with the Expenditure Secretary today at 5.15 P.M. about the issue of orders onBonus Ceiling. It is told that still the official Minutes of the Friday's Cabinet Meeting not come to MOF and therefore no OM could be issued by the DOPT on the matter of revision of ceiling @ 3500/-. This order is likely to be issued only after the arrival of Minutes of Cabinet Meeting. All employees are advised to take payment on the basis of the 30th September 2008 Bonus Order and await further orders for taking payment of arrears of bonus.

MOF YET TO ISSUE ORDERS ON BONUS REVISION

MOF YET TO ISSUE ORDERS ON BONUS REVISION MINISTRY OF FINANCE WILL ISSUE ORDERS ON SEEING THE CABINET MINUTES ANY TIME

MOF ORDERS NOT YET RELEASED SINCE CABINET DECIDED ONLY ON FRIDAY DEPARTMENT OF POSTS ENDORSEMENT ONLY AFTER MOF ORDERS