Daily Archive: August 6, 2018

GST To Be Simplified To 3 Slabs: Fin Min

Principal Economic advisor to the Finance Ministry Sajeev Sanyal on Saturday said Goods and Services Tax (GST) slabs may be brought down to three along with the exemption category in order to further simplify the country’s tax regime.

“The lower rate will be five per cent, the middle bracket of 12 and 18 per cent can be combined to a central rate of round about 15 per cent and we might have a top rate of 25 percent,” he said. “The central rate of 15 per cent will be applied for the bulk of goods. We are looking to have a simple tax rate with round figures and most of the goods with the same rate,” he said. Currently there are four GST slabs of 5, 12, 18 and 28 per cent, plus the exempted category which attracts zero per cent GST.

Sanyal said the centre would consider further simplifying the direct tax collection system and reduce the rates if the tax revenues continue to do well. “As the tax system gets simplified, more and more people will be paying their taxes. The tax collection has significantly gone up since the introduction of GST and now a lot of people are paying direct taxes,” he said. So if the direct tax revenues continue to do well, the centre may further simplify the direct tax system, lower the rates and would ultimately move towards the corporate tax rate of 25 percent,” said Sanyal. (IANS)

 

Dr Neelam Gupta, Founder President of AROH Foundation receives “Best CSR Professional of the Year 2018 Award ”.

Dr Neelam Gupta, President & CEO of AROH Foundation has been conferred with the prestigious “CSR Professional of the Year 2018” by CSR Times for her outstanding contribution in social sector and for ‘Individual Excellence & Outstanding Contribution’ for the Progress of the Nation at a gala ceremony held at India Habitat Centre in New Delhi on 2nd August 2018.

Honourable Shri Suresh Prabhu (Union Minister of Commerce & Industry), Honourable Shri K J Alphons (Union Minister of State, Ministry of Tourism), Dr Bhaskar Chatterjee (Ex DG, IICA), Padma Bhushan Smt Rajshree Birla , Padma Shri Sri K K Aggarwal and many other distinguished dignitaries presided over the ceremony to give away the prestigious awards. The award recognises Dr Gupta’s awe-inspiring work towards the socially neglected section of the society. Her undying efforts to help the downtrodden of the society has perched her brain child AROH Foundation as a leading national level NGO in the social development sector which is setting up new milestones in development and change with several pioneering projects being implemented all across the nation.

Will See If Article 35A Is Violative Of Basic Structure Of Constitution: CJI Misra

New Delhi: The Supreme Court on Monday refused to hear the challenge to Article 35A in the absence of a judge of a three-judge bench that was hearing the case and directed the next hearing on August 27.

It also said that on its next hearing it will decide whether the matter should be referred to a five-judge Constitution Bench.

As some lawyers insisted on the hearing, a bench of Chief Justice Dipak Misra and Justice A.M. Khanwilkar said as the matter was being heard by a three-judge bench also comprising of Justice D.Y. Chandrachud, and since the later was not available, it could not be heard.

“Article 35A is in vogue for the last 60 years and we will only see whether it is violative of the basic structure of the constitution,” said Chief Justice Misra as he refused the plea for an early hearing.

The Jammu and Kashmir government has already sought adjournment citing panchayat and urban bodies election scheduled in September.

Attorney General K.K. Venugopal told the court that with elections to 6,000 Panchayats to be held in September, “it was not an opportune time to hold the hearing”.

Venugopal also told the court that the interlocutors were also talking to the state government.

As the court directed the listing of the matter from the week starting August 27, Additional Solicitor General Tushar Mehta appearing for the Jammu and Kashmir said: “We reserve the right to seek adjournment on the grounds cited in the letter to the court.” (IANS)

New route to funding higher education infrastructure

Gone are the days when universities and other higher educational institutions under MHRD would, beside maintenance grants, receive every five year development grants for creating physical facilities, infrastructure development and for starting new courses and programmes. Beginning from the current financial year, they would instead have to approach the Higher Education Funding Agency (HEFA) for loans.

Established as a joint venture of MHRD and Canara Bank, HEFA is a not-for-profit non-banking finance company. With an equity base of Rs 10,000 crore, the agency targets to mobilise Rs 1,00,000 crore through a mix of government guaranteed bonds and commercial borrowings to ‘provide timely finance at low interest rates for capital assets creation in India’s higher educational institutions and supplement it with grants by channelling Corporate Social Responsibility (CSR) funds from corporates and donations from others’.

All higher educational institutions that are established, funded or referred to by the MHRD shall be eligible to receive funds for creation and renovation of physical facilities and infrastructure required for teaching, research and residences; library and laboratory equipment; and common facilities for students and other stakeholders. The maximum amount of loan that an institution can access is to be determined by the quality of projects it submits but more importantly by the cash flow stream from internally generated resources that it offers to service the loan. To ensure steady recovery of loans, the borrowing institutions are required to open an escrow account of the HEFA bankers and commit a portion of their cash flows for the repayment of loan.

As per the original scheme, the interest burden on such borrowings was to be serviced through grants-in-aid by MHRD or UGC, as the case may be, and the repayment of the principal was to be made by the borrowing institution over ten years in equal instalments. Wary of the challenges of mobilising additional resources to service the debt, higher educational institutions have obviously been recalcitrant to the idea. It was, therefore, no surprise that HEFA could approve loan proposal worth about Rs 2,000 crore only to just handful of higher educational institutions, as against the targeted disbursal of about Rs 25,000 crore during the current financial year to hundred plus institutions.

Realising the realities of the higher education scenario and responding to the concerns of the higher educational institutions, the government has come up with a new scheme called Revitalising Infrastructure and System in Education (RISE) by 2022 with the aim of fast track infrastructure development in higher educational institutions for creating state-of-the-art infrastructure by providing project-based funding through HEFA. RISE by 2022 reiterates that the interest burden on loan shall be serviced though grants from the respective funding agencies but classifies higher educational institutions into five categories with varying degrees of repayment obligation for the principal component of the loan.

Accordingly, while the technical institutions established more than ten years ago shall have to repay the whole of the principal portion of the loan through their internally generated resources, such of them which came into existence between 2008 to 2014 shall have to take care of only a fourth of the principal component and the balance is to be paid out of grants by the government.

Similarly, the central universities established prior to 2014 shall be required to repay just a tenth of the principal component of the loan taken. Most importantly, those established after 2014 and other institutions under MHRD with little scope of fee revision and internal resource generation shall not have to repay the principal amount at all and the same shall be serviced out of grants by the funding agency. So shall be the case for the newly established All India Institutes of Medical Sciences (AIIMSs) and the Kendriya and Navodaya Vidyalayas. It appears that Rs 1,000 crore promised to each of the public-funded universities selected as institutions of eminence shall also be financed through RISE, though it is unclear as to what proportion of the principal component they shall be required to repay.

While the RISE by 2022 may not be as good as the development grant system prevalent so far but is indeed a reprieve to the higher educational institutions except the older technical institutions when compared to the original scheme of funding under HEFA. They would still have to repay a portion of the principal through their own resources but the burden would be much less than if they had to repay the whole of the principal component. Higher educational institutions shall be all the more confident in accessing funds under RISE if they are further assured that the grants for servicing the principal and interest components of the loan shall not reduce or adversely impinge on the annual maintenance grants that they have so far been getting.

As regards national implications, HEFA and RISE are new experiments to finance capital investment in education through extra-budgetary resources. Had this funding window been over and above the development grants, it would have indeed fast-tracked infrastructure development in our higher educational institutions. Alas, they are only a substitute to the development grants.

SC judges to meet CJI over Justice Joseph’s appointment

New Delhi: Supreme Court judges who are upset with the Centre altering the seniority of Justice K.M. Joseph for his appointment as the Supreme Court judge will meet Chief Justice Dipak Misra on Monday, August 6 over the issue.

The judges include collegium members who are unhappy as the Presidential notification listed Justice Joseph at number three in terms of seniority thereby making him the junior most judge of the top court when he will be administered oath on Tuesday along with two other judges – Justices Indira Banerjee and Vineet Saran.

The recommendation for Justice Joseph’s elevation as a top court judge was made by the collegium in January which was reiterated on July 17.

The collegium while recommending Justice Joseph’s name described him as one of the most able and suitable.

The seniority is not the only criteria for elevation as a top court judge, but the government in order to frustrate the appointment of Justice Joseph as top court judges has cited seniority as a consideration.

Ever since the collegium recommended Justice Joseph for elevation, the government and the judiciary are at loggerheads.

Justice Joseph earned the displeasure of the government after he set aside the imposition of President’s rule in Uttarakhand.