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Employees earning more than Rs. 15,000 in basic wages plus dearness allowance will not be affected Only allowances that are variable and linked to the employee’s efforts, such as overtime allowance, can be excluded, the court said. EPF deduction According to the Employees’ Provident Fund (EPF) Act, 1952, 12% of an employee’s basic salary and dearness allowance has to be invested into EPF and the employer needs to invest an equal sum. For example, if your basic salary and dearness allowance add up to  ₹ 12,000, your employer has to deduct  ₹ 1,440 towards PF every month and match it with  ₹ 1,440 from its own pocket. Both these amounts are, typically, a part of the cost to company (CTC). If you earn more than  ₹ 15,000 per month in basic salary plus dearness allowance, employers can limit the PF deduction to 12% of  ₹ 15,000 (  ₹ 1,800) under the proviso to Para 26A of the Employees Provident Fund Scheme, 1952. This also brings down th...

A bench of Justices Arun Mishra and Naveen Sinha ruled that employers cannot segregate 'special allowance' from basic wages for purpose of PF deductions. The apex court has ruled that employers cannot segregate 'special allowance' from basic wages for purpose of PF deductions. The Supreme Court has passed an order on Provident Fund (PF) calculation that will have far-reaching impact on companies and the salaried class. A bench of Justices Arun Mishra and Naveen Sinha yesterday ruled that employers cannot segregate 'special allowance' from basic wages for purpose of PF deductions. The court was hearing a clutch of appeals questioning whether "the special allowances paid by an establishment to its employees would fall within the expression "basic wages" under Section 2(b)(ii) read with Section 6 of the Act for computation of deduction towards Provident Fund". Note that employers and employees both contribute 12% of wages in EPF. Un...

The apex court in its judgement has ruled that special allowance is part of the basic wages for computing the employees provident fund. After the Supreme Court held that special allowance is part of basic wages for EPF dues computation, retirement fund body EPFO has decided to take a stringent action against those firms which will not take into account such component in PF contributions. The apex court in its judgement has ruled that special allowance is part of the basic wages for computing the employees provident fund (EPF). The employer as well as employee pay 12 per cent of basic wages each towards contribution for social security scheme run by the Employees' Provident Fund Organisation (EPFO). "Following the judgement, the EPFO will take stringent action against firms which would not factor in special allowance for computation of EPF contributions. The body is studying the judgement and would soon come out with a detailed plan to implement the judgement," a ...

Reposting my article on Demonetisation written 2 years ago: Understanding Demonetisation: 99% currency coming back into banking system is actually measure of its success, not failure Where the demonetisation debate turns bizarre is when self professed well-informed critics take a single data point, like return of 99 percent of devalued currency, and argue that this signifies "utter failure of the motive" and hence demonetization has failed. This attempt to base a sweeping judgement on a single matrix is being done by that section of the elite upper class and / or leftovers - who suffer from a reflexive derision of Modi, and wouldn't budge from making a political point in the garb of economic prudence. Their problem with Modi is essentially that they are no match to him. Let us analyse their core argument and see how it is flawed. First, nowhere did the government make any definitive claim that a huge amount of devalued currency would never return, much less mention...

GST Council Meeting Outcome- 1. Hotel Tariffs Rs. 7,500 and above GST at 18%. 2. Hotel Tariffs Rs. 1,000 upto 7,500 GST at 12%. 3. Hotel Tariffs below Rs. 1,000 GST at Nil rate. 4. Outside Catering GST rate reduced at 5%. 5. Diamond Job-work GST rate reduced at 1.5% and Other Job-work GST rate reduced to 12% from 18%. 6. Council amended rules regarding Refund by Appellate Authority. 7. Council amended rules regarding GST Practitioners and Consumer Welfare Fund. 8. Cups/Plates made from Flowers leaves GST rate Nil from 5%. 9. GST Annual Returns GSTR-9, 9A Optional for those with turnover upto 2cr for FY 17-18 & 18-19. 10. Those with turnover above 2cr to still file GSTR9. 11. No relief in case of GSTR-9C as it’s applicable only where turnover exceeds 2cr. 12. GSTR-9 also to be made “Saral”. 20/9/2019

FM ANNOUNCEMENT 👉🏽Corporate tax rate to be 22% without exemptions, inclusive of surcharge and cess. 👉🏽No Minimum Alternate Tax (MAT) applicable on such companies 👉🏽Effective corporate tax rate after surcharge to be 25.17 percent 👉🏽To attract investment in manufacturing, local companies incorporated after October 2019 will pay tax at 15 percent 👉🏽That effective tax for new companies shall be 17.01 percent, including cess and surcharge. Companies enjoying tax holidays would be able to avail concessional rates post the exemption period. 👉🏽Will give MAT relief for those opting to continue paying surcharge and cess. MAT has been reduced to 15 percent from 18.5 percent for companies who continue to avail exemptions and incentives: 👉🏽To stabilise flow of funds into the market the enhanced surcharge announced in Budget 2019 will not apply on capital gains arising on sale of any security, including derivatives by foreign portfolio investors (FPI) 👉🏽For listed co...

The pro active Modi Govt No one expected such a big stimulus that markets were stunned. Giving up taxes to the tune of 1.45 lakh crores in a period where the tax collections were sluggish and the central Govt has many commitments to fulfil. It was a shock but shows the alertness and readiness to take bold steps. This step has inspired the confidence of India watchers that this Govt will do all that is needed. It may be a little late but concerned people are burning midnight oil in search of steps to push investment and growth up. This also shows that the Govt is not shy of taking steps in favour of large companies which form the backbone of economy. It also hints to a possible large scale strategic sale of Govt companies for which the share market has to be in fit shape. So many messages delivered with one giant step. Market has also given its Thumbs Up. The environment of doom and gloom has turned into hope and bloom. Happy days are here again.

The Nirmala put? Back in the 1990s and Alan Greenspan days, there was something called "Greenspan put". As the US Federal head, he would cut rates or change policy everytime the market was in trouble. He was responsible for the biggest wealth creation in US and also for the 2008 crisis. Anyways, the "Greenspan's put" is clearly being played in India now. Every Friday, Nirmala Sitharaman comes out and does something that will help the market. There is a clear "Nirmala put" in place now. For all the memes on her, she is now at par with the best FM of India. The move to cut Corporate Tax is bigger than MMS's 1991 budget - not for the impact but because it happened when there is no crisis at our doors. That is a critical difference. Today I am also reminded of the press conference Modi did after the last phase of elections in May where he said people think we do things without planning and “aisa nahi hota hain”. Looking back it is clear...

मंदीवर मात करण्यासाठी करकपातीचे ' निर्मला' ब्रह्मस्त्र ःःःःःःःःःःःःःःःः.. पंतप्रधान नरेंद्र मोदी यांच्या नेतृत्त्वाखाली भाजपला बहुमत मिळाल्यानंतर भांडवली बाजाराने त्यांचे उत्साहात स्वागत केले होते. मोदी यांना मित्रपक्षांची फारशी गरज लागणार नसल्याने आर्थिक सुधारणांच्या वाटेवरून हे सरकार चालेल, अशी अपेक्षा होती. अरुण जेटली यांनी पुन्हा मंत्रिमंडळात येण्यास तब्येतीच्या कारणास्तव नकार दिल्याने मोदी यांनी अर्थखात्याची जबाबदारी निर्मला सीतारामन यांच्यावर सोपविली. त्यांच्या पहिल्याच अर्थसंकल्पाने उद्योग जगताची घोर निराशा झाली. डेव्हिल्स टॅक्ससारखे कर मागे घेतले; परंतु कंपनी करात वाढ केली. श्रीमंतावर अधिक कर लावण्याची भाषा केली. गुंतवणूकदारांनी केलेल्या भांडवली गुंतवणुकीच्या परताव्यावरही कर लावला. त्यामुळे गुंतवणूकदार गोंधळात पडले. शेअर बाजाराने सलग काही दिवस सीतारामन यांच्या अर्थसंकल्पावर नाराजीची मोहोर उमटवली होती. असे असताना अर्थसंकल्पावरील चर्चेत जरी काही मागण्या मान्य केल्या असत्या, तरी गेल्या तीन महिन्यांत देशाच्या अर्थव्यवस्थेची जी स्थिती झाली, तशी ती झाली नसती. श्रीमंताव...

RBI restrictions on PMC Bank. Depositors panic Bracing limits on the amounts of withdrawl by depositors from the urban co-operative bank, the Reserve bank of India on Tuesday placed Mumbai-based Punjab and Maharashtra Cooperative Bank (PMC Bank) under directions for six months from the close of business of the bank. "The depositors will be allowed to withdraw a sum not exceeding ₹1,000 of the total balance in every savings bank account or current account or any other deposit account by whatever name called, subject to conditions stipulated in the law", the directive issued by the Central Bank read. Further, without the prior approval in writing from the Reserve Bank, the Urban Co-operative Bank will also not be able to grant or renew any loans and advances, make any investment, incur any liability including borrowal of funds and acceptance of fresh deposits, disburse or agree to disburse any payment whether in discharge of its liabilities and obligations, enter into any...

#पंजाबआणिमहाराष्ट्रसहकारीबँक: रिझर्व्ह बँकेने शेवटी 35A लावला. लोकं बँकेच्या दारासमोर रांगा लावून बसली आहेत. ही बँक एक रात्रीत बुडाली का? उत्तर आहे #नाही. खरं उत्तर आहे ते 'घोटाळे व त्यातून निर्माण होणारी बुडीत कर्जे ह्या कडे RBI ने केलेला अक्षम्य काणाडोळा.' कॉसमॉस सहकारी बँक ह्या काण्या डोळ्यांची १९९४ सालापासूनची लाभार्थी आहे. मी विचारलेल्या साधारण ₹.२,९०० कोटीच्या घोटाळे वजा बुडीत कर्जाची किती वसुली झाली ह्या बाबतीत कॉसमॉस बँकेचे अध्यक्ष सीए मिलिंद काळे व त्यांचे साथी डॉक्टर मुकुंद अभ्यंकर, कृष्णकुमार गोयल, वगैरे अजूनही उत्तर देत नाहीत. खाजगीत म्हणतात वसुली २% पण नाही. बुडीत कर्जाची रक्कम आणखी बरीच आहे. देव न करो नाहीतर ह्या बँकेच्या बाबतीत ही 35A ची ऑर्डर एक दिवस वाचायला मिळायची. आणि बहुदा हेच टाळण्यासाठी कॉसमॉस सहकारी बँकेच्या खाजगिकरणाचा डाव आखला आहे. स्वतः च्याच गुर्मीत असलेल्या संचालक मंडळाला वाटत की खाजगिकरण केलं की सगळे घोटाळे गाडले गेले! सहकारी बँकांमधील भ्रष्टाचार व त्यांना वर्षोनुवर्षे पाठीस घालणारे RBI चा inspection स्टाफ व संबंधित वरिष्ठ अधिकारी हेच ह्या ...

Punjab Maharashtra Co-op Bank and The Law The Law The Reserve Bank of India’s (RBI) directions on the Punjab and Maharashtra Co-operative Bank is not a one-off event, though customers are worried. “The directions are imposed in exercise of powers vested in the Reserve Bank under Sub-section (1) of Section 35A of the Banking Regulation Act, 1949 read with Section 56 of the said Act,” the RBI said in a statement, adding that it should not be seen as a cancellation of the banking license. What do these Acts state? Section 35(A) of the Banking Regulation Act says that the RBI in public interest and to “to prevent the affairs of any banking company being conducted in a manner detrimental to the interests of the depositors or in a manner prejudicial to the interests of the banking company; or to secure the proper management of any banking company generally” can issue directions to these entities. Section 56 of the Act applies to cooperative societies. @ Dayanand Nene

Lokhandwala Infrastructure is the second big developer to go insolvent under the provisions of the Insolvency and Bankruptcy Code (IBC) after Housing Development and Infrastructure Ltd (HDIL). The  National Company Law Tribunal  has initiated insolvency resolution proceedings against leading Mumbai developer Lokhandwala Infrastructure Private Limited and asked operational creditors, financial creditors, homebuyers and employees to submit their claims with proof by October 3. Anotice issued by Ajit Kumar, the NCLT-appointed Insolvency Resolution Professional, said the Mumbai Bench of NCLT ordered the initiation of the process on September 19 and hopes to conclude it by March 17, 2020. Lokhandwala Infrastructure is the second big developer to go insolvent under the provisions of the Insolvency and Bankruptcy Code (IBC) after  Housing Development and Infrastructure Ltd (HDIL) . NCLT had initiated insolvency proceedings against HDIL on August 26 after it failed to repay du...

The IBC, which came into force in 2016, is the country’s bankruptcy law that seeks to consolidate the existing framework by creating a single law for insolvency and bankruptcy. The Mumbai bench of the National Company Law Tribunal ( NCLT ) has initiated a corporate insolvency resolution process against D S Kulkarni Developers Limited (DSKDL), the sole public limited company of jailed developer D S Kulkarni, alias DSK, after admitting a petition for the same by the  Bank of Maharashtra  ( BoM ) over a default of Rs119.48crore debt by the firm. An interim resolution professional (IRP), appointed by the tribunal under the Insolvency and Bankruptcy Code (IBC), released a public announcement on Monday calling upon the financial creditors as well as fixed deposit (FD) holders and home buyers in DSKDL projects to submit their claims with proof by October 9. The IBC, which came into force in 2016, is the country’s bankruptcy law that seeks to consolidate the existing framework by c...

The circular has been issued against the company's Managing Director Sarang Wadhawan and Whole Time Director Rakesh Kumar Wadhawan. The government has issued a look out circular against two directors of realty firm  HDIL  after preliminary findings allegedly revealed financial irregularities at the company, according to a senior official. A look out circular is issued against a person directing the immigration authorities to ensure that he or she does not leave India through an airport or seaport. The official told that the circular has been issued against the company's Managing Director  Sarang Wadhawan  and Whole Time Director  Rakesh Kumar Wadhawan . The move follows a request by the Ministry of Corporate Affairs which has been made operational by the Bureau of Immigration that comes under the Ministry of Home Affairs, the official added. Further, the official said the circular has been issued against the two directors based on a preliminary report receive...

HDIL has been at the center of the crisis at PMC Bank which reportedly did not disclose that its exposure to HDIL was about Rs 6,226 crore or 73% of the bank’s total loan book. The ministry of corporate affairs has initiated a probe into  Housing Development and Infrastructure Ltd  ( HDIL ) according to a senior government official. HDIL has been at the center of the crisis at Punjab and Maharashtra Cooperative (PMC) Bank which reportedly did not disclose that its exposure to HDIL was about Rs 6,226 crore or 73% of the bank’s total loan book. RBI regulations limit single entity exposure for banks to 15% of capital funds. “It is quite natural that if a bank has sunk because of excessive exposure to a particular company for years together, how it is managing its affairs deserves to be looked into,” said a senior government official who did not wish to be named. Mumbai–based  PMC bank  which has operations in seven states, collapsed recently and the RBI ordered it to...

Panic-stricken customers rushed to bank’s branches across the state and were unable to withdraw more than Rs 1,000, then raised to Rs. 10,000/-. They had not been aware that the bank, which was under the supervisory glare of the RBI, was being milked by real estate players led by HDIL with the connivance of bank officials.  Reserve Bank of India (RBI)  slapped restrictions  on Punjab and Maharashtra Cooperative Bank Ltd (PMC Bank), a leading cooperative bank headquartered in Mumbai, appointed an administrator and superseded its board of directors, sending shock waves among thousands of its depositors. Panic-stricken customers rushed to bank’s branches across the state and were unable to withdraw more than Rs 1,000, subsequently raised to Rs. 10,000/-.  They had not been aware that the bank, which was under the supervisory glare of the RBI, was being milked by real estate players led by HDIL with the connivance of bank officials. Advertising W...