Monthly Archives: June 2017

New Delhi:  Mobile phone bills are expected to go up while recharges would yield less talk-time for prepaid customers from tomorrow under the new Goods and Services Tax (GST) regime.

Under the GST, telecom services would be taxed at 18 per cent compared to the current 15 per cent.

This means that a user would get a talk-time of about Rs. 80 on a recharge of Rs. 100, compared to about Rs. 83 earlier.

Similarly, costs for post-paid users would also go up to the extent of three percentage points. So, for a monthly usage of Rs. 1,000, users will have to pay Rs. 1,180 instead of Rs. 1,150 currently.

However, it remains to be seen whether telecom operators choose to absorb some impact of the increased tax levy (as they can claim input credit) or pass it on entirely to their customers.

Emails to telecom operators remained unanswered.

A number of retailers in the city remain clueless about the impact of the new tax regime on telecom services.
"It is only tomorrow once we start recharging for customers that we will get to know how much talk-time the customer is getting. But going by simple calculation, it (talk-time) is expected to be lesser," said one of the shopkeepers in the bustling Connaught Place area.

He added that it will take a few days for the situation to normalise.

Many customers who walked in for recharges, too, seemed unaware of what the GST roll out would mean for prepaid services.

Telecom operators are already under intense pressure, inflicted by newcomer Reliance Jio's competitive pricing. The industry had expected some relief from the GST Council in the form of a lower tax slab for telecom services.

However, the same was increased following which industry lobbyists made multiple representations stating that telecommunications is an essential service and should attract a lower tax rate of 5 per cent.

"Today it (industry) is saddled with an unprecedented debt of more than Rs. 4.5 lakh crore, with revenues of less than Rs. 2 lakh crore ... we are hopeful that the government will ... revise the current rate of 18 per cent, which is fairly high to the requested rate of 5 per cent," Cellular Operators' Association of India Director General, Rajan S Mathews told PTI.

This rate of five per cent is better aligned to telecom as it is an essential service and critical infrastructure, he opined.

 

 

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Kolkata: Former India defender Subrata Bhattacharya will get the 'Mohun Bagan Ratna' for this year, the club announced on Friday.

The award is the club's highest honour.

It was also announced that striker Balwant Singh will bag the best footballer of the year. The awardees will be honoured on the club's foundation day on July 29.

Debabrata Das will get the best cricketer prize, while Indian women's cricket team fast bowler Jhulan Goswami, middle-distance runner Lili Das and Mount Everest conqueror Shaikh Sahabuddin will be given special awards.

Bhattacharya, who has coached East Bengal and Prayag United besides Mohun Bagan, was hired as city-based outfit Bhowanipore FC coach almost a month ago.

A tough defender during his time, the Arjuna award winner was part of India's 1984 Asian Cup campaign.

Bhattacharya was captain of Mohun Bagan's ‘Class of 1977' when the Mariners won a treble - Durand Cup, Rovers Cup and the IFA Shield - and also played against a New York Cosmos team that had Pele in it. The match ended in a 2 2 draw.

Bhattacharya will be the 17th recipient of the award, which was instituted in 2001, with late Sailen Manna being the first recipient.

 

 

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New Delhi:  Senior Supreme Court lawyer K.K. Venugopal, an eminent constitutional lawyer who has five decades of practice in the apex court, was on Friday appointed the new Attorney General of India.

President Pranab Mukherjee signed the order of his appointment on Friday within 20 days of the resignation of Mukul Rohatgi, who was given an extension of tenure but declined it. 

Venugopal, 86, is a veteran constitutional expert who was once an Additional Solicitor General appointed during the Morarji Desai regime after the Emergency. 

Kottayan Katankot Venugopal is the son of a well-known barrister the late M.K. Nambiyar, who was a doyen of the Madras bar and who had practiced in the Supreme Court too. 

Venugopal, who started appearing in the Supreme Court in the early 60s while based in Madras, was designated as a senior advocate by the apex court in 1972. Five years later, after the end of Emergency, he was appointed an Additional Solicitor General that necessitated his shift to Delhi. 

Venugopal, who has often been called to be the amicus curiae to the Supreme Court for handling difficult cases, brings to the Attorney General's office the experience of 50 years' practice in the Supreme Court. 

Apart from being involved in many important cases before constitutional benches of the apex court, Venugopal acted as amicus curiae in the infamous 2G spectrum scam case relating to irregular allotment of bandwidth to telecom operators during the tenure of the UPA-I government. He assisted the Supreme Court in monitoring investigations by the CBI and the Enforcement Directorate. 

He had appeared for the Madhya Pradesh government opposing the challenge to the National Judicial Appointments Commission (NJAC) and L.K. Advani and other senior BJP leaders in the Babri Masjid demolition conspiracy case.

Venugopal had cautioned the top court against sentencing Justice C.S. Karnan to six months imprisonment for contempt. Appearing for the Madras High Court, he had tried to caution the bench that it would suffer the blemish of putting a sitting judge in prison.

Venugopal, one of the main advocates of judicial reforms in India, is against the creation of regional benches of the Supreme Court. Instead he favours Courts of Appeal to be established in four regions of the country to finally decide on appeals from High Court judgements in all cases, other than cases of national importance which affect the whole country, disputes between states and the Centre and substantial question of law relating to interpretation of the Constitution. 

This, he feels, will relieve the burden on the Supreme Court.

His son Krishnan Venugopal is a senior lawyer in the Supreme Court.

 

 

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NEW DELHI:  With the launch of the Goods and Services Tax (GST) at midnight, "a new direction will be given to the country's progress," Prime Minister Narendra Modi said today. In a few hours from now, the Prime Minister will launch the country's biggest tax reform at Parliament's historic Central Hall in the presence of President Pranab Mukherjee. The powerful GST council that has detailed the landmark reform met in Delhi just ahead of the midnight function. It is the fourth time since Independence that an event will be held in the Central Hall at midnight. The last three celebrated India's Independence and that is among the reasons that the Congress has listed for boycotting the GST launch. Several other opposition parties too are staying away.

 

Here are the top 10 updates ahead of GST launch 2017:

Central Hall has been fitted with new carpets and sound systems for the big night. The event will start at 11 pm and will extend to just after midnight to usher in GST on July 1, the new date set after an April 1 deadline was missed. A gong will be sounded at 12 to signal GST is here.

President Pranab Mukherjee and PM Modi will make speeches. At the high table of the Central Hall, former Prime Minister HD Deve Gowda will join them as will Lok Sabha Speaker Sumitra Mahajan and Vice President Hamid Ansari. Former PM Dr Manmohan Singh was invited too but the Congress' boycott means he will not be there.

Nearly 1,000 people are expected. Industrialist Ratan Tata will be there, as will RBI governor Urjit Patel and former governors Bimal Jalan and YV Reddy. Mr Patel's predecessor Raghuram Rajan is not attending.

The government has invited all Members of Parliament, Chief Ministers and state finance ministers. Opposition parties like the Congress, the Left, West Bengal Chief Minister Mamata Banerjee's Trinamool Congress, DMK and Lalu Yadav's RJD are boycotting the event. The Aam Aadmi Party too isn't attending the launch.

Bihar Chief Minister Nitish Kumar of the Janata Dal (United) or JD(U) has backed GST and though he will not attend, his party lawmakers have not been asked to stay away. Senior JD(U) leaders Sharad Yadav and KC Tyagi will also skip the launch.

Tamil Nadu's ruling party AIADMK, which had walked out when the GST Bill was passed in Parliament, said though they are not fully satisfied with provisions of the new tax, they "have no option but to support GST" and will attend today's launch.

Union Minister Nitin Gadkari said, "Congress is a confused party where their Chief Ministers and finance ministers are supporting the GST and at the same time, the party leaders are criticising it.

"A reform that holds great potential is being rushed through in a half-baked way with a self-promotional spectacle," Congress Vice President Rahul Gandhi tweeted. But like demonetisation, GST is being executed by an incompetent and insensitive government without planning, foresight and institutional readiness, he tweeted. The party has also objected to the plan for PM Modi to launch GST, saying President Pranab Mukherjee will be present and so should do the honours.

Opposition parties also say that protests this week by textile traders show that small traders and others are not ready for GST. They suggested postponing the launch, with the Congress suggesting a two-month trial run before a launch on September 1.

"No transition can be seamless but we will make it as seamless as possible. Let people be assured that there is no intention to harass if a genuine mistake is made...mistakes can be taken care of," Revenue Secretary Hasmukh Adhia told on Thursday.

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New Delhi: India on Friday said it has told China that the building of a road by Chinese troops in a border region will have "serious security implications for India" and urged Beijing "not to change the status quo unilaterally".

"India is deeply concerned at the recent Chinese actions and has conveyed to the Chinese government that such construction would represent a significant change of status quo with serious security implications for India," an External Affairs Ministry statement said.

This was India's first public reaction to an ongoing stand-off between Indian and Chinese troops on their border. Beijing has sharply escalated the rhetoric, with the People's Liberation Army telling New Delhi to remember its 1962 military debacle.

The statement said India had underlined that New Delhi and Beijing had in 2012 reached an agreement that the tri-junction boundary points between India, China and third countries would be finalized in consultation with the concerned countries. 

"Any attempt, therefore, to unilaterally determine tri-junction points is in violation of this understanding," the Indian statement said.

The latest stand-off occurred in Donglong or Doklam, a disputed territory between Bhutan and China. Beijing has accused India of obstructing road building in the area, which it claims as its own.

Beijing has also charged New Delhi with acting at the behest of Bhutan, which also lays claim to Donglong. 

The External Affairs Ministry denied that Indian border troops crossed the boundary in the Sikkim sector of the China-India frontier and entered Chinese territory. 

It said a PLA construction party entered Doklam area on June 16 and attempted to build a road despite objections from a Royal Bhutan Army patrol. Bhutan lodged a protest with China on June 20.

On Thursday, Bhutan said the construction of the road inside its territory was a violation of the 1988 and 1998 agreements with China.

India said that in keeping with the tradition of maintaining close consultation on matters of mutual interest, Bhutan and India had been in continuous contact "through the unfolding of these developments".

It said that in coordination with the Bhutanese Army, Indian soldiers who were present at general area Doka La "approached the Chinese construction party and urged them to desist from changing the status quo. These efforts continue".

India said the matter was under discussion between the Indian and Chinese foreign ministries since then both in New Delhi and Beijing. It was also discussed at a meeting of border personnel at Nathu La on June 20.

"Where the boundary in the Sikkim sector is concerned, India and China had reached an understanding also in 2012 reconfirming their mutual agreement on the 'basis of the alignment'. 

"Further discussions regarding finalization of the boundary have been taking place under the Special Representatives framework.

"It is essential that all parties concerned display utmost restraint and abide by their respective bilateral understandings not to change the status quo unilaterally. 

"It is also important that the consensus reached between India and China through the Special Representatives process is scrupulously respected by both sides."

The statement said India had consistently taken a positive approach to the settlement of its own boundary with China, along with the associated issue of the tri-junctions.

It said India cherished peace and tranquillity on the India-China border areas. "It has not come easily. 

"Both sides have worked hard to establish institutional framework to discuss all issues to ensure peace and tranquillity in the India-China border areas," the statement said. 

"India is committed to working with China to find peaceful resolution of all issues in the border areas through dialogue."

 

 

 

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NEW DELHI: Rakesh Sachdeva sells auto parts in a busy market in central Delhi, just a few miles from Prime Minister Narendra Modi's office. Yet despite having a flourishing business he does not pay any tax.

Until now, his rundown premises and small scale operation has kept the business below the radar of tax officials. Come July 1, however, "the party will be over", says the 51-year-old, with a resigned shrug.

A nationwide Goods and Services Tax (GST), set to come into effect on Saturday, has faced criticism for its complex design. But the country's biggest tax reform since independence is promising to bring millions of firms like Sachdeva's into the tax net, boosting government revenues and India's sovereign credit profile.

The new tax will require firms to upload their invoices every month to a portal that will match them with those of their suppliers or vendors.

Because a tax number is needed for a firm to claim a credit on the cost of its inputs, many companies are refusing to buy from unregistered businesses. Those who don't sign up risk losing any customer who has.

"I have no option, but to register with the new system," said Sachdeva, who spoke to Reuters on condition the name and precise location of his shop were not disclosed.

Boosting The Coffers

Improved tax compliance should shore up public finances, augmenting resources for welfare and development spending and giving a lift to the $2 trillion economy.

India currently has one of the worst tax-to-GDP ratios among major economies at 16.6 percent, less the half the 34 percent average for the members of the OECD and also below many emerging economies.

While there is no official estimate of the potential fiscal gain, some tax experts say the measure, after the initial teething trouble, would lift the tax-to-GDP ratio by as much as 4 percentage points as the number of tax filers is estimated to more than treble to 30 million.

"In future, compliance is going to be extremely crucial," Rajiv Nair, chief executive officer at Kaya Ltd., told Reuters. "Since we are also responsible for compliance across the supply chain, we have to ensure that the suppliers we have are in a position to work with us in a compliant manner."

Nair's company, which makes beauty and personal care products, has just streamlined its supply chain, dropping vendors that were not going to be GST-compliant.
Other companies are doing the same. Elior Group, a French catering and food service company, said it has mandated GST-compliance as one of the eligibility criteria for its orders.

Winners And Losers

The unorganised sector of India's economy is vast, employing an estimated nine out of 10 workers.

While staying outside the GST regime risks losing business, joining it will necessitate an overhaul of firms' accounting systems and an investment in technology.

The new tax system requires three filing a month plus an annual return - a total of 37 filings - for each of India's 29 states in which a firm operates. For smaller companies operating on wafer thin margins, hiring accountants and technical staff could substantially dent their bottom line.

Sanjiv Mehra, head of a traders' body in Delhi, reckons a "prohibitive" cost could prove to be counterproductive.

"Compliance is needed for input tax credit," he said. "But what if you are in a business where margins are strong and allows you to forsake credit?"

But despite its flaws, many analysts think the new tax will be good news for bigger established businesses, because it will sweep away an array of federal and state sales taxes, levied at different stages of the supply chain, that often result in double taxation.

The government estimates the GST will save companies around $14 billion because it will allow them to organise their warehouses and supply chains more efficiently.

Firms can now move to demand-based "hub-and-spoke" models used globally, rather than operating state-by-state.

"Those companies which can wring out the maximum cost efficiency are the ones investors should bet on," said Ajay Bodke, head of portfolio management services at financial firm Prabhudas Lilladher in Mumbai. "All consumer-facing industries will be big beneficiaries of the GST."

 

 

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GST or goods and services tax will change the indirect tax landscape of the country from July 1, subsuming over a dozen of state and central taxes. Since GST is meant to eliminate "tax on tax", experts say overall tax burden on goods is expected to fall over time. Many essential goods such as unpacked food grains, gur, milk, eggs and salt won't attract any tax under GST. Some services will get costlier as banking and financial services have been put in the 18 per cent rate slab under GST, from 15 per cent earlier.

"However, going forward, it is expected that due to reduced cost because of availability of GST credit on items hitherto not available, the price of services will also come down which will benefit the consumers," says Sandeep Sehgal, director-tax and regulatory at Ashok Maheshwary & Associates LLP.

Prices of many common goods at the stores are likely to remain unchanged in the initial days after the GST rollout, say experts. Manufacturers may wait for a few weeks to gauge the net impact of GST on them as well as on wholesalers and distributors and may revise the prices accordingly later, says Mr Sehgal.

 

After GST rollout, many items like footwear below Rs. 500, garments and mobile phones could become cheaper. On the other hand, items like TV and small cars could become costlier.

 

Petroleum products such as petrol, diesel and aviation turbine fuel have been kept out of GST as of now. The GST Council will take a decision on it at a later date. Alcohol has also been kept out of GST.

Here is the list of goods, their current effective tax rates and respective GST rates under the new tax system, according to professional services firm EY:

 

Items Current rate (%) GST (%)
Perfume 17.5 - 27 18
Cosmetics 28
Cheese 5-14.5 12
Butter 12
Glucometers 11-20.5 12
Tableware - Metal 11 18
 
Revised 12% for spoons, forks, ladles, skimmers, cake servers, fish knives, tongs
Tableware - Ceramic 17.5 18
Tableware - Wood 18 and 28
Tableware - Plastic 18
Kitchenware - Metal 11-20.5 18
 
Revised 12% for Spoons, forks, ladles, skimmers, cake servers, fish knives, tongs
Kitchenware-Ceramic 17.5 - 27 18
Kitchenware-Wood 18 and 28
Kitchenware-Plastic 18
Kitchenware-Fly ash 18
X-Ray Apparatus (for medical, dental & veterinary) 17.5-27 12
X-Ray Apparatus 28
     
Footwear (below Rs. 500) 14.41 5
Footwear(above Rs. 500) 14.41 18
Readymade garments (below Rs.1000) 5-6 5
Readymade garments (above Rs.1000) 18.5 12
Biscuits( Less than Rs. 100/kg) 11.89 18
Biscuits(Above Rs. 100/kg) 16.09 18
Corn-flakes 9.86 18
Wrist watch 20.64 28
Jam 5.66 18
Baby food (sold in unit containers) 7.06 18
Cellular Phone 13-24 12
Small Cars (<4m <1200 cc petrol) 25-27 28+1 (cess)
Small Cars (<4m <1500 cc diesel) 25-27 28+3 (cess)
Mid-segment (<1500 cc) 36-40 28+15 (cess)
Cars with 1500 cc & larger engines 41.5-44.5 28+15 (cess)
Vehicles for transport with 10 to 13 passenger capacity (cannot be considered as bus) 39-41 28+15
     
Motorcycles 25-35 28
Motorcycles Engine >350 25-35 28+3 (cess)
Television 25-27 28
     
Stationery (Plastics) 11-27 18
Stationery (Paper) 12 and 18
 
Rates revised on following items from 18% to 12% - Exercise books and note books
 
Stationery (Pen/Fountain Pen)  
 
Rates revised on following items from 18% to 12% - Eraser
 
Renewable energy devices 17-18 5
Iron Ore 17-18 5
Digital Cameras 25-27 28
Luxury items like yacht 25-27 28+3 (cess)
Music Instruments (Handmade) 0-12.5 0
Music Instruments (Other than Handmade) 25-27 28

Powered by EY

 

Notes from EY:
-These are illustration purposes only, not meant for direct implementation or reliance
-These rates are based on the best of our understanding of the applicable rates and should not be taken as an assurance of ultimate rates.
-Information as of June 20.
-EY assumes no responsibility to update for changes in after the date of the submission.

 

 

 

 

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Berlin: Germany on Friday became the 23rd country in the world to legalise same-sex marriage, after lawmakers passed a bill in a snap vote that was approved by Chancellor Angela Merkel just four days ago.

The initiative, which delivers full rights to same-sex couples, including on adoption, was propelled through Germany's Bundestag (parliament) with the backing of 393 lawmakers to 226 against, reports Efe news.

"Progress is possible. As the 23rd country on earth, we now have marriage equality in Germany. I'm happy for all the married couples-to-be," wrote Martin Schulz on Twitter, whose Social Democratic Party (SPD) seized on Chancellor Angela Merkel's decision on Monday to allow the vote.

The SPD has several government ministers in office as part of its grand coalition agreement with Merkel's Christian Democratic Union, but broke ranks with the CDU in order to push for Friday's vote, sparking criticism from several conservative lawmakers.

Merkel voted against the measure, saying she personally believed marriage in German law is be between a man and a woman, although she thought same-sex adoption should be possible.

"I hope that the vote today not only promotes respect between different opinions but also brings more social cohesion and peace," she added.

The measure was backed by the SPD, the Left and the Green Party as well as members of the CDU, who were allowed a free vote.

Speaking during the debate ahead of the vote, SPD parliamentary chairman Thomas Oppermann argued that "if gay marriage is chosen, then many will receive something, but nobody will have something taken away".

In his debate intervention, CDU's parliamentary group leader Volker Kauder reiterated his ideological support for those who believe marriage should be available only for a man and woman, he added, however, he would respect those in his party who would vote in support.

Jan Marco Luczack, also from the CDU, defended legalising same-sex marriage, saying conservatives should defend the traditional values of love and harmony.

Prior to the vote, same-sex couples had access to civil unions.

Germany now joins 13 other European countries such as the Netherlands, Spain, the UK and Ireland, which already have same-sex marriage laws in place.

 

 

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Mumbai: Director Tigmanshu Dhulia, who will be portraying the role of superstar Shah Rukh Khan's father in Anand L Rai's next, where Shah Rukh is playing a dwarf, says he wanted to be part of the project to see how it is done.

"I do very few films as an actor but when a filmmaker friend feels that I can do justice to certain role -- and when I need some money -- then only I do a film. It's a very technical film in which Shah Rukh is playing a character of dwarf so I wanted to see how it is made because when Kamal Hassan (Appu Raja) did it, that time he did that with folded legs and VFX facility also wasn't available," said Tigmanshu at the trailer launch of his upcoming film "Raagdesh" on Thursday.

"So, to know that process, I did this film. It's a very time consuming film where you have to give the best effort because you have to shoot each shot with 3 to 4 different approaches and in each day they only used to complete only one scene so it's a hard film to make, but they are giving their best effort for that," he added.

Talking about the challenges that he faced while working on "Raagdesh" which is based on 1945 Red Fort Trials when the Indian National Army soldiers were court martialled by the British, Tigmanshu said: "When you are writing a fictional story, that time writer can use his imagination to write a story, but when you have real story, then you have to mould it into proper film script. Then it is challenging, especially when you don't have the permission to tamper with past facts."

"Each scene of this film is documented with the help of some or the other books, so I haven't had any opportunity to take cinematic liberty in this film," he added.

"Raagdesh" features Kunal Kapoor, Amit Sadh and Mohit marwah in lead roles.

The film is schedules to release on July 28.

 

 

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New Delhi:  The India of 2017 is different from the India of 1962, Defence Minister Arun Jaitley said on Friday, a day after China asked New Delhi to learn from its 1962 military debacle.

"If they are trying to remind us, the situation in 1962 was different, the India of today is different," Jaitley said at India Today's Midnight Conclave in response to the reported remark by the People's Liberation Army (PLA) spokesperson.

China warned India on Thursday that it will escalate the current border row if Indian troops did not withdraw from "Chinese territory" and told New Delhi not to "clamour for war".

Jaitley said that Bhutan government had made it clear that China was trying to claim Bhutanese land and said this was "absolutely wrong".

"After the statement of the government of Bhutan, I think the situation is absolutely clear. It is Bhutan's land, close to the Indian border, and Bhutan and India have an arrangement to provide security.

"Bhutan itself clarified ... China is trying to alter the present status-quo. After this, I think the issue is absolutely clear. To say we will come there and grab the land of some other country is what China is doing and it is absolutely wrong," the minister said.

Jaitley's comment came amid a stand-off between Indian and Chinese troops in Dokala area close to the Siliguri corridor that connects the rest of India to its north-east.

 

 

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