Union Budget proposed law — the Benami Transactions (Prohibition) Bill — to fight black money at home. Finance Minister Arun Jaitley talks tough action

If the previous NDA regime’s Prevention of Terrorism Act (POTA) became an instrument of misuse and human rights violations by the authorities, new laws outlined in the budget to fight black money threaten to put similar unbridled powers in the hands of enforcement agencies.

Concealment of income and assets and evasion of tax in relation to foreign assets will be prosecutable with punishment of rigorous imprisonment (RI) up to 10 years, and offenders will not be permitted to approach the Settlement Commission; those caught concealing income and assets will be penalised at 300% of the tax due. And not filing returns or inadequately disclosing foreign assets in those returns could result in seven years’ RI.

The measures evoked a strong response from industrialists and Opposition alike.

“The black money law is draconian with imprisonment even for minor transgressions, and it will be a source of harassment. It will also turn out to be ineffective in the absence of sophisticated information gathering systems,” said Mohandas Pai, former finance head of Infosys.

Manish Tewari, senior Congress leader and Supreme Court lawyer who deals in tax matters, said, “It’s simply the re-introduction of FERA. It is, in fact, far more draconian than FERA. It is going to put a huge amount of power in the hands of the Enforcement Directorate, which is really not known for its outstanding probity. But the fundamental question is: If you are sincere in your intention to unearth black money, why this distinction between black money stashed abroad and in India?”

Jaitley announced another proposed law — the Benami Transactions (Prohibition) Bill — to fight black money at home. The bill will be introduced this Parliament session.

“This law will enable confiscation of benami property and provide for prosecution, thus, blocking a major avenue for generation and holding of black money in the form of benami property, especially in real estate,” he said.

Changes in income tax laws will be made so that, effective June 1, all transactions such as loans or deposits or advances for transfer of immovable property are done through an account payee cheque or account payee bank draft or by electronic clearing system through a bank account, if the amount of the loan or deposit is Rs 20,000 or higher.

Jaitley also raised the outlay for the special investigation team (SIT) on black money by nearly 10% to Rs 45.39 crore to help expand its infrastructure and logistics procurement capabilities.

Union Budget proposed law — the Benami Transactions (Prohibition) Bill — to fight black money at home. Finance Minister Arun Jaitley talks tough action

States to be equal partners in economic growth; move to making India cashless society; social sector programmes to continue.

Full Speech of Finance Minister

Stock market participants gave thumbs up to the Union Budget 2015, with some terming it as “dream budget”, following promise of lower corporate taxes and deferral of GAAR. “Overall it was a dream budget. Corporate taxes down, GAAR postponed, crackdown on illegal money, wealth tax abolished. Major takeaways from the budget 2015 were high stress on Make in India, rural development this will surly bring a surge in job creations.

 

CONTENTS

 

PART – A

                                                                                                            Page No.

                    Introduction                                                                             1

                    Major Challenges Ahead                                                        5

                    Fiscal Roadmap                                                                       6

                    Good Goverance                                                                      6

                    Agriculture                                                                               7

                    Funding the Unfunded                                                           8

                    From Jan Dhan to Jan Suraksha                                           9

                    Infrastructure                                                                        10

                    Financial Markets                                                                  12

                    Monetising Gold                                                                    13

                    Investment                                                                              14

                    Safe India                                                                               14

                    Tourism                                                                                  14

                    Green India                                                                            15

                    Skill India                                                                               15

                    Digital India                                                                           17

                    Budget Estimates                                                                   18

 

PART – B

 

                    TAX PROPOSALS                                                              19

                              Conclusion                                                                 27

                              Annexure                                                                   28

                    Annexure to Part – B                                                              

                               (a)     Direct Taxes                                                        30

                               (b)     Indirect Taxes                                                      36

 

Budget  2015-2016

 

Speech  of

Arun Jaitley

Minister of Finance

 

February 28,  2015

 

Madam Speaker,

I rise to present the Budget of the Union for the year 2015-16.

  1. I present this Budget in an economic environment which is far more positive than in the recent past. When other economies are facing serious challenges, India is about to take-off on a faster growth trajectory once again. The International Monetary Fund (IMF) has downgraded its earlier forecast of global economic growth by 0.3%, and the World Trade Organization has revised its forecast of world trade growth from 5.3% to 4%. Forecasts for India, however, have either been upgraded, or remained the same, without downgrades.  Madam Speaker, we have also embraced the States as equal partners in the process of economic growth.  States have been economically empowered more than ever before and it is my belief that every rupee of public expenditure, whether undertaken by the Centre or the States, will contribute to the betterment of people’s lives through job creation, poverty elimination and economic growth.
  2. In the last nine months, the NDA Government headed by Prime Minister Shri Narendra Modi, has undertaken several significant steps to energise the economy. The credibility of the Indian economy has been re-established.  The world is predicting that it is India’s chance to fly.

Kuch to phool khilaye humne, aur kuch phool khilane hai

Mushkil yeh hai bag me ab tak, kaante kai purane hai

  1. Though the Union Budget is essentially a Statement of Account of public finances, it has historically become a significant opportunity to indicate the direction and the pace of India’s economic policy. My proposals, therefore, lay out the roadmap for accelerating growth, enhancing investment and passing on the benefit of the growth process to the common man, woman, youth and child: those, whose quality of life needs to be improved.  This is the path which we will doggedly and relentlessly pursue.  As the Prime Minister has often said, we are a round-the-clock, round-the-year Government.
  2. Madam, allow me to describe the changes in the Indian economy since we first took office. In November, 2012, CPI inflation, stood at 11.2%, the current account deficit by the first quarter of 2013-14 had reached 4.6% of GDP, and normal foreign inflows until March 2014 were $15 billion.  We inherited a sentiment of, if I may say so, doom and gloom, and the investor community had almost written us off.
  3. We have come a long way since then. The latest CPI inflation rate is 5.1%, and the wholesale price inflation is negative; the current account deficit for this year is expected to be below 1.3% of GDP; based on the new series, real GDP growth is expected to accelerate to 7.4%, making India the fastest growing large economy in the world; foreign inflows since April 2014 have been about $55 billion, so that our foreign exchange reserves have increased to a record $340 billion; the rupee has become stronger by 6.4% against a broad basket of currencies; and ours was the second-best performing stock market amongst the major economies.  In short, Madam Speaker, we have turned around the economy dramatically, restoring macro-economic stability and creating the conditions for sustainable poverty elimination, job creation and durable double-digit economic growth. Domestic and international investors are seeing us with renewed interest and hope.
  4. While being mindful of the challenges, Madam Speaker, this gives us reason to feel optimistic. With all the humility at my command, I submit that this opportunity has arisen because we have created it. The people of India had voted resoundingly for quick change, faster growth and highest levels of transparency. They wanted the scam, scandal and corruption Raj to end. They wanted a Government in which they can trust. We have lived up to that trust.
  5. Our actions have not been confined to the core or macro-economic areas alone. Illustratively, action has been taken with regard to allocation of natural resources; financial inclusion; health and hygiene of the common man; girls and their education; employment for the youth; improved and non-adversarial tax administration; effective delivery of benefits; investment and job creation; welfare of labour; agricultural productivity and increasing farm incomes; power; digital connectivity; skilling our youth; efficient and better work culture in Government; ease of doing business; mainstreaming North Eastern States; and, reviving our pride in the nation and culture.  I am giving the details in an Annexure to this speech.
  6. Madam Speaker, of the work that we have done, I would like to talk of three achievements as they demonstrate the quality and conviction of our government. One is the success of the Jan Dhan Yojana.  Financial inclusion has been talked about for decades now.  Who would have thought that in a short period of 100 days, over 12.5 crore families could have been brought into the financial mainstream?  The other is coal auctions.  Earlier, the States only got benefits of royalty. Now, by the transparent auction process that we are carrying out, the coal bearing States will be getting several lakh of crore of rupees which they can use for creation of long awaited community assets and for welfare of their people.
  7. The third is ‘Swachh Bharat’ which we have been able to transform into a movement to regenerate India. I can speak of, for example, the 50 lakh toilets already constructed in 2014-15, and I can also assure the Members of this august House that we will indeed attain the target of building six crore toilets.  But, Madam, Swachh Bharat is not only a programme of hygiene and cleanliness but, at a deeper level, a programme for preventive health care, and building awareness.
  8. We are now embarked on two more game changing reforms. GST and what the Economic Survey has called the JAM Trinity – Jan Dhan, Aadhar and Mobile – to implement direct transfer of benefits.  GST will put in place a state-of-the-art indirect tax system by 1st April, 2016.  The JAM Trinity will allow us to transfer benefits in a leakage-proof, well-targetted and cashless manner.
  9. Madam Speaker, one of the major achievements of my government has been to conquer inflation. This decline, in my view, represents a structural shift.  Going forward, we expect CPI inflation to remain at close to 5% by the end of the year.  This will allow for further easing of monetary policy.
  10. To ensure that our victory over inflation is institutionalized and hence continues, we have concluded a Monetary Policy Framework Agreement with the RBI, as I had promised in my Budget Speech for 2014-15. This Framework clearly states the objective of keeping inflation below 6%.  We will move to amend the RBI Act this year, to provide for a Monetary Policy Committee.
  11. The Central Statistics Office has recently released a new series for GDP, which involves a number of changes relative to the old series. Based on the new series, estimated GDP growth for 2014-15 is 7.4%. Growth in 2015-16 is expected to be between 8 to 8.5%. Aiming for a double-digit rate seems feasible very soon.
  12. I now come to the task ahead of us. In respect of social and economic indicators, for seven decades now, we have worked in terms of percentages, and numbers of beneficiaries covered. It is quite obvious that incremental change is not going to take us anywhere.  We have to think in terms of a quantum jump.
  13. The year 2022 will be the Amrut Mahotsav, the 75th year, of India’s independence. The vision of what the Prime Minister has called ‘Team India’, led by the States and guided by the Central Government, should include:

(i)         A roof for each family in India.  The call given for ‘Housing for all’ by 2022 would require Team India to complete 2 crore houses in urban areas and 4 crore houses in rural areas.

(ii)        Each house in the country should have basic facilities of 24-hour power supply, clean drinking water, a toilet, and be connected to a road.

(iii)       At least one member from each family should have access to the means for livelihood and, employment or economic opportunity, to improve his or her lot.

(iv)       Substantial reduction of poverty.  All our schemes should focus on and centre around the poor. Each of us has to commit ourselves to this task of eliminating absolute poverty.

(v)        Electrification, by 2020, of the remaining 20,000 villages in the  country, including by off-grid solar power generation.

(vi)       Connecting each of the 1,78,000 unconnected habitations by all weather roads.  This will require completing 1,00,000 km of roads currently under construction plus sanctioning and building another 1,00,000 km of road.

(vii)      Good health is a necessity for both quality of life, and a person’s productivity and ability to support his or her family.  Providing medical services in each village and city is absolutely essential.

(viii)     Educating and skilling our youth to enable them to get employment is the altar before which we must all bow.  To ensure that there is a senior secondary school within 5 km reach of each child, we need to upgrade over 80,000 secondary schools and add or upgrade 75,000 junior/middle, to the senior secondary level.  We also have to ensure that education improves in terms of quality and learning outcomes.

(ix)       Increase in agricultural productivity and realization of reasonable prices for agricultural production is essential for the welfare of rural areas.  We should commit to increasing the irrigated area, improving the efficiency of existing irrigation systems, promoting agro-based industry for value addition and increasing farm incomes, and reasonable prices for farm produce.

(x)        In terms of communication, the rural and urban divide should no longer be acceptable to us.  We have to ensure connectivity to all the villages without it.

(xi)       Two-thirds of our population is below 35.  To ensure that our young get proper jobs, we have to aim to make India the manufacturing hub of the world.  The Skill India and the Make in India programmes are aimed at doing this.

(xii)      We also have to encourage and grow the spirit of entrepreneurship in India and support new start-ups.  Thus can our youth turn from being job-seekers, to job-creators.

(xiii)     The Eastern and North Eastern regions of our country are lagging behind in development on many fronts. We need to ensure that they are on par with the rest of the country.

  1. By the time of the 75th year of Indian independence, Amrut Mahotsav of our independence is reached, we have to achieve all of the above, so that India becomes a prosperous country; and a responsible global power.  This will be our true and meaningful tribute to our freedom fighters.

Major Challenges Ahead

  1. As I stated earlier, Madam Speaker, I am also mindful of the five major challenges I have to reckon with. Firstly, Agricultural incomes are under stress.  Our second challenge is increasing investment in infrastructure.  With private investment in infrastructure via the public private partnership (PPP) model still weak, public investment needs to step in, to catalyse investment.
  2. Our third major challenge is that manufacturing has declined from 18% to 17% of GDP as per new GDP data; and manufacturing exports have remained stagnant at about 10% of GDP. The Make in India programme is aimed at meeting this challenge, thus creating jobs.
  3. Fourth, we need to be mindful of the need for fiscal discipline in spite of rising demands for public investment. In keeping with the true spirit of co-operative federalism, we have devolved a 42% share of the divisible pool of taxes to States. As members of this august House are aware, this is an unprecedented increase which would empower states with more resources. The devolution to the States would be of the order of `5.24 lakh crore in 2015-16 as against the devolution of `3.38 lakh crore as per revised estimates of 2014-15.  Another `3.04 lakh crore would be transferred by way of grants and plan transfers.  Thus, total transfer to the States will be about 62% of the total tax receipts of the country.
  4. In spite of the consequential reduced fiscal space for the Centre, the Government has decided to continue supporting important national priorities such as agriculture, education, health, MGNREGA, and rural infrastructure including roads. Programmes targeted for the poor and the under-privileged, will be continued by us.
  5. With fiscal space not just reduced but squeezed, I have to meet the fifth challenge of maintaining fiscal discipline. Economic growth this year, at 11.5%, was lower in nominal terms by about 2%, due to lower inflation.  Consequently, tax buoyancy was also significantly lower.  Despite this, Madam, I have kept my word, and we will meet the challenging fiscal deficit target of 4.1% of GDP, that we had inherited.  Madam Speaker, I need to overcome these challenges to reduce and eliminate poverty.

Fiscal Roadmap

  1. I want to underscore that my government still remains firm on achieving the medium term target of 3% of GDP. But that journey has to take account of the need to increase public investment.  The total additional public investment over and above the RE is planned to be `1.25 lakh crore out of which `70,000 crore would be capital expenditure from budgetary outlays.  We also have to take into account the drastically reduced fiscal space; uncertainties that implementation of GST will create; and the likely burden from the report of the 7th Pay Commission.  Rushing into, or insisting on, a pre-set time-table for fiscal consolidation pro-cyclically would, in my opinion, not be pro-growth.  With the economy improving, the pressure for accelerated fiscal consolidation too has decreased.  In these circumstances, I will complete the journey to a fiscal deficit of 3% in 3 years, rather than the two years envisaged previously.  Thus, for the next three years, my targets are: 3.9%, for 2015-16; 3.5% for
    2016-17; and, 3.0% for 2017-18.  The additional fiscal space will go towards funding infrastructure investment.
  2. I am moving amendments accordingly, in the Finance Bill, to the FRBM Act.
  3. Madam Speaker, I want to round up the discussion on the fiscal road map on an optimistic note. While there is a compositional shift, the aggregate envelope for job creation, poverty elimination and building infrastructure is not disturbed; in fact it goes up this year, and every subsequent year, in the same proportion as the tax revenues of the Union, and the State Governments increase.  From this national perspective of public finances, not only is the path to fiscal consolidation on track, aggregate annual capital expenditure of the Governments, as a whole, can be expected to rise  significantly, by more than 0.5% of GDP.
  4. Madam Speaker, it may be noted that the budget reflects considerable scaling up of disinvestment figures. This will include both disinvestment in loss making units, and some strategic disinvestment.

Good Governance

  1. Madam, Speaker, this Government is committed in its resolve, as Indians, to regain our pre-eminence as a just and compassionate country. Well-intentioned schemes  introduced in the past, have often been ill-targeted, riddled with leakages and delivered with inefficiency.  The same is true of subsidies.  Subsidies are needed for the poor and those less well off. What we need is a well targeted system of subsidy delivery. We need to cut subsidy leakages, not subsidies themselves.We are committed to the process of rationalizing subsidies based on this approach.
  2. We have embarked on that path. The direct transfer of benefits, started mostly in scholarship schemes, will be further expanded with a view to increasing the number of beneficiaries from the present 1 crore to 10.3 crore.  Similarly, `6,335 crore have so far been transferred directly, as LPG subsidy to 11.5 crore LPG consumers.  I am sure, persons who are better-off, such as those in the top tax bracket, and those genuinely concerned for the welfare of the poor, such as members of this House, will give up their LPG subsidy voluntarily.

Agriculture

  1. Our commitment to farmers runs deep. We have already taken major steps to address the two major factors critical to agricultural production: soil and water.  An ambitious Soil Health Card Scheme has been launched to improve soil fertility on a sustainable basis.  In order to improve soil health, I also propose to support Agiculture Ministry’s organic farming scheme – “Paramparagat Krishi Vikas Yojana”.  The Pradhanmantri Gram Sinchai Yojana is aimed at irrigating the field of every farmer and improving water use efficiency to provide `Per Drop More Crop’.  I am allocating `5,300 crore to support micro-irrigation, watershed development and the Pradhan Mantri Krishi Sinchai Yojana.  I urge the States to chip in substantially in this vital sector.
  2. To support the agriculture sector with the help of effective and hassle-free agriculture credit, with a special focus on small and marginal farmers,
    I propose to allocate `25,000 crore in 2015-16 to the corpus of Rural Infrastructure Development Fund (RIDF) set up in NABARD; `15,000 crore for Long Term Rural Credit Fund; `45,000 crore for Short Term Cooperative Rural Credit Refinance Fund; and `15,000 crore for Short Term RRB Refinance Fund.
  3. Farm credit underpins the efforts of our hard-working farmers. I have, therefore, set up an ambitious target of `8.5 lakh crore of credit during the year 2015-16 which, I am sure, the banks will surpass.
  4. Our government is committed to supporting employment through MGNREGA. We will ensure that no one who is poor is left without employment. We will focus on improving the quality and effectiveness of activities under MGNREGA. I have made an initial allocation of `34,699 crore for the programme.
  5. While the farmer is no longer in the clutches of the local trader, his produce still does not command the best national price. To increase the incomes of farmers, it is imperative that we create a National agricultural market, which will have the incidental benefit of moderating price rises. I intend this year to work with the States, in NITI, for the creation of a Unified National Agriculture Market.

Funding the Unfunded

  1. Madam Speaker, our government firmly believes that development has to generate inclusive growth. While large corporate and business entities have a role to play, this has to be complemented by informal sector enterprises which generate maximum employment. There are some 5.77 crore small business units, mostly individual proprietorship, which run small manufacturing, trading or service businesses. 62% of these are owned by SC/ST/OBC.  These bottom-of-the-pyramid, hard-working entrepreneurs find it difficult, if not impossible, to access formal systems of credit.  I, therefore, propose to create a Micro Units Development Refinance Agency (MUDRA) Bank,  with a corpus of `20,000 crore, and credit guarantee corpus of `3,000 crore.  MUDRA Bank will  refinance Micro-Finance Institutions through a Pradhan Mantri Mudra Yojana. In lending, priority will be given to SC/ST enterprises. These measures will greatly increase the confidence of young, educated or skilled workers who would now be able to aspire to become first generation entrepreneurs; existing small businesses, too,  will be able to expand their activities. Just as we are banking the un-banked, we are also funding the un-funded.
  2. A significant part of the working capital requirement of a MSME arises due to long receivables realization cycles. We are in the process of establishing an electronic Trade Receivables Discounting System (TReDS) financing of trade receivables of MSMEs, from corporate and other buyers, through multiple financiers.  This should improve the liquidity in the MSME sector significantly.
  3. Bankruptcy law reform, that brings about legal certainty and speed, has been identified as a key priority for improving the ease of doing business. SICA (Sick Industrial Companies Act) and BIFR (Bureau for Industrial and Financial Reconstruction) have failed in achieving these objectives.  We will bring a comprehensive Bankruptcy Code in fiscal 2015-16, that will meet global standards and provide necessary judicial capacity.
  4. The Government is committed to increasing access of the people to the formal financial system. In this context, Government proposes to utilize the vast Postal network with nearly 1,54,000 points of presence spread across the villages of the country.  I hope that the Postal Department will make its proposed Payments Bank venture successful so that it contributes further to the Pradhan Mantri Jan Dhan Yojana.
  5. To bring parity in regulation of Non-Banking Financial Companies (NBFCs) with other financial institutions in matters relating to recovery, it is proposed that NBFCs registered with RBI and having asset size of `500 crore and above will be considered for notifications as ‘Financial Institution’ in terms of the SARFAESI Act, 2002.

From Jan Dhan to Jan Suraksha

  1. A large proportion of India’s population is without insurance of any kind – health, accidental or life. Worryingly, as our young population ages, it is also going to be pension-less.  Encouraged by the success of the Pradhan Mantri Jan Dhan Yojana, I propose to work towards creating a universal social security system for all Indians, specially the poor and the under-privileged.
  2. The soon-to-be-launched Pradhan Mantri Suraksha Bima Yojna will cover accidental death risk of `2 lakh for a premium of just `12 per year. Similarly, we will also launch the Atal Pension Yojana, which will provide a defined pension, depending on the contribution, and its period. To encourage people to join this scheme, the Government will contribute 50% of the beneficiaries’ premium limited to `1,000 each year, for five years, in the new accounts opened before 31st December, 2015.
  3. The third Social Security Scheme that I wish to announce is the Pradhan Mantri Jeevan Jyoti Bima Yojana which covers both natural and accidental death risk of `2 lakhs. The premium will be `330 per year, or less than one rupee per day, for the age group 18-50.
  4. There are unclaimed deposits of about `3,000 crore in the PPF, and approximately `6,000 crore in the EPF corpus. I have proposed the creation of a Senior Citizen Welfare Fund, in the Finance Bill, for appropriation of these amounts to a corpus which will be used to subsidize the premiums of vulnerable groups such as old age pensioners, BPL card-holders, small and marginal farmers and others. A detailed scheme would be issued in March.
  5. Madam Speaker, special regard needs to be paid to the population of senior citizens in the country which is now approximately 10.5 crore, out of which over one crore are above the age of 80 years. 70% live in rural areas and a large number are in the BPL category.  A sizeable percentage of them also suffer from age related disabilities.  Ours is a society that venerates its elders.
    I, therefore, propose that a new scheme for providing Physical Aids and Assisted Living Devices for senior citizens, living below the poverty line.
  6. In sum, these social security schemes reflect our commitment to utilize the Jan Dhan platform, to ensure that no Indian citizen will have to worry about illness, accidents, or penury in old age. Being sensitive to the needs of the poor, under-privileged and the disadvantaged, my Government also remains committed to the ongoing welfare schemes for the SCs, STs and Women. Despite serious constraints on Union finances, allocations made this year are as follows:

            SC                                         ` 30,851 crore

            ST                                         ` 19,980 crore

            Women                                 ` 79,258 crore

  1. An integrated education and livelihood scheme called ‘Nai Manzil’ will be launched this year to enable Minority Youth who do not have a formal school-leaving certificate to obtain one and find better employment. Further, to show-case civilization and culture of the Parsis, the Government will support, in2015-16, an exhibition, ‘The Everlasting Flame’. The allocation for the Ministry of Minority Affairs is being protected. The BE for the year 2015-16 is `3,738 crore.

Infrastructure

  1. Madam, it is no secret that the major slippage in the last decade has been on the infrastructure front. Our infrastructure does not match our growth ambitions. There is a pressing need to increase public investment.  I have, therefore, increased outlays on both the roads and the gross budgetary support to the railways, by `14,031 crore, and `10,050 crore respectively.   The CAPEX of the public sector units is expected to be ` 3,17,889 crore, an increase of approximately `80,844 crore over RE 2014-15. In fact, all told, investment in infrastructure will go up by `70,000  crore in the year 2015-16, over the year 2014-15 from the Centre’s Funds and resources of CPSEs.
  2. Secondly, I intend to establish a National Investment and Infrastructure Fund (NIIF), and find monies to ensure an annual flow of ` 20,000 crore to it. This will enable the Trust to raise debt, and in turn, invest as equity, in infrastructure finance companies such as the IRFC and NHB.  The infrastructure finance companies can then leverage this extra equity, many fold.  Thirdly, I also intend to permit tax free infrastructure bonds for the projects in the rail, road and irrigation sectors.  Fourth, the PPP mode of infrastructure development has to be revisited, and revitalised.  The major issue involved is rebalancing of risk. In infrastructure projects, the sovereign will have to bear a major part of the risk without, of course, absorbing it entirely.
  3. Fifth, I also intend to establish, in NITI, the Atal Innovation Mission (AIM). AIM will be an Innovation Promotion Platform involving academics, entrepreneurs, and researchers and draw upon national and international experiences to foster a culture of innovation, R&D and scientific research in India. The platform will also promote a network of world-class innovation hubs and Grand Challenges for India.  Initially, a sum of ` 150 crore will be earmarked for this purpose.
  4. India has a well regarded and world-class IT industry with revenues of about US$ 150 billion, over US$ 100 billion of exports, employing nearly 40 lakh people directly. We are now seeing a growing interest in start-ups.  Experimenting in cutting edge technologies, creating value out of ideas and initiatives and converting them into scalable enterprises and businesses is at the core of our strategy for engaging our youth and for inclusive and sustainable growth of the country. Concerns such as a more liberal system of raising global capital, incubation facilities in our Centres of Excellence, funding for seed capital and growth, and ease of Doing Business etc. need to be addressed to create lakh of jobs and hundreds of billion dollars in value.
  5. With this objective, Government is establishing a mechanism to beknown as SETU (Self-Employment and Talent Utilisation). SETU will be a Techno-Financial, Incubation and Facilitation Programme to support all aspects of start-up businesses, and other self-employment activities, particularly in technology-driven areas. I am setting aside ` 1,000 crore initially in NITI Aayog for this purpose.
  6. As the success of so-called minor ports has shown, ports can be an attractive investment possibility for the private sector. Ports in the public sector need to both attract such investment as well as leverage the huge land resources lying unused with them.  To enable us to do so, ports in public sector will be encouraged, to corporatize, and become companies under the Companies Act.
  7. Madam Speaker, investors spend a large amount of time and resources on getting the multiple permissions required. We aim towards ease of doing in India.  I have myself launched the e-Biz Portal which integrates 14 regulatory permissions at one source.  Good States are embracing and joining this platform.  However, if we really want to create jobs, we have to make India an investment destination which permits the start of a business in accordance with publically stated guidelines and criteria.
  8. I intend to appoint an Expert Committee for this purpose to examine the possibility and prepare a draft legislation where the need for multiple prior permissions can be replaced with a pre-existing regulatory mechanism.
  9. The Government also proposes to set up 5 new Ultra Mega Power Projects, each of 4000 MWs in the plug-and-play mode. All clearances and linkages will be in place before the project is awarded by a transparent auction system.  This should unlock investments to the extent of ` 1 lakh crore.  The Government would also consider similar plug-and-play projects in other infrastructure projects such as roads, ports, rail lines, airports etc. I am happy to announce that the second unit of Kudankulam Nuclear Power Station will be commissioned in 2015-16.
  10. Madam Speaker, I hope to garner some additional resources during the year from tax buoyancy. If I am successful, then over and above the budgetary allocation, I will endeavour to enhance allocations to MGNREGA by ` 5,000 crore; Integrated Child Development Scheme (ICDS) by ` 1,500 crore; Integrated Child Protection Scheme (ICPS) by ` 500 crore; and the Prdhan Mantri Krishi Sinchai Yojana by ` 3,000 crore; and the initial inflow of ` 5,000 crore into the NIIF.

Financial Markets

  1. One vital factor in promoting investment in India, including in the infrastructure sector, is the deepening of the Indian Bond market, which we have to bring at the same level as our world class equity market. I intend to begin this process this year by setting up a Public Debt Management Agency (PDMA) which will bring both India’s external borrowings and domestic debt under one roof.
  2. I also propose to merge the Forwards Markets Commission with SEBI to strengthen regulation of commodity forward markets and reduce wild speculation. Enabling legislation, amending the Government Securities Act and the RBI Act is proposed in the Finance Bill, 2015.
  3. Capital Account Controls is a policy, rather than a regulatory, matter.
    I, therefore, propose to amend, through the Finance Bill, Section-6 of FEMA to clearly provide that control on capital flows as equity will be exercised by the Government, in consultation with the RBI.
  4. A properly functioning capital market also requires proper consumer protection. I, therefore, also propose to create a Task Force to establish a sector-neutral Financial Redressal Agency that will address grievances against all financial service providers.  I am also glad to inform the House that work assigned to the Task Forces on the Financial Data Management Centre, the Financial Sector Appellate Tribunal, the Resolution Corporation, and the Public Debt Management Agency are progressing satisfactorily.  We have also received a large number of suggestions regarding the Indian Financial Code (IFC), which are currently being reviewed by the Justice Srikrishna Committee.  I hope, sooner rather than later, to introduce the IFC in Parliament for consideration.
  5. Madam, Speaker, this is just the beginning. I have a vision of putting in place a direct tax regime which is internationally competitive on rates, is without exemptions, incentivises savings, and does not realize tax from intermediaries.  Such a direct tax regime would match the modernized indirect taxes regime we are putting in place by way of GST, and will bring both greater transparency and greater investments.
  6. Madam Speaker the situation with regard to the dormant Employees Provident Fund (EPF) accounts and the claim ratios of ESIs is too well known to be repeated here. It has been remarked that both EPF and ESI have hostages, rather than clients.  Further, the low paid worker suffers deductions greater than the better paid workers, in percentage terms.
  7. With respect to the Employees Provident Fund (EPF), the employee needs to be provided two options. Firstly, the employee may opt for EPF or the New Pension Scheme (NPS). Secondly, for employees below a certain threshold of monthly income, contribution to EPF should be optional, without affecting or reducing the employer’s contribution. With respect to ESI, the employee should have the option of choosing either ESI or a Health Insurance product, recognized by the Insurance Regulatory Development Authority (IRDA). We intend to bring amending legislation in this regard, after stakeholder consultation.

Monetising Gold

  1. India is one of the largest consumers of gold in the world and imports as much as 800-1000 tonnes of gold each year. Though stocks of gold in India are estimated to be over 20,000 tonnes, mostly this gold is neither traded, nor monetized. I propose to:

(i)      Introduce a Gold Monetisation Scheme, which will replace both the present Gold Deposit and Gold metal Loan Schemes.  The new scheme will allow the depositors of gold to earn interest in their metal accounts and the jewelers to obtain loans in their metal account.  Banks/other dealers would also be able to monetize this gold.

(ii)     Also develop an alternate financial asset, a Sovereign Gold Bond, as an alternative to purchasing metal gold.  The Bonds will carry a fixed rate of interest, and also be redeemable in cash in terms of the face value of the gold, at the time of redemption by the holder of the Bond.

(iii)    Commence work on developing an Indian Gold Coin, which will carry the Ashok Chakra on its face.  Such an Indian Gold Coin would help reduce the demand for coins minted outside India and also help to recycle the gold available in the country.

  1. One way to curb the flow of black money is to discourage transactions in cash. Now that a majority of Indians has or can have, a RUPAY debit card.  I, therefore,  proposes to introduce soon several measures that will incentivize credit or debit card transactions, and disincentivise cash transactions.

Investment

  1. Alternate Investment Funds Regulations have been notified by SEBI. Such alternate investment funds provide another vehicle for facilitating domestic investments.  Keeping in view the need to increase investments from all sources, I propose to also allow foreign investments in Alternate Investment Funds.
  2. To further simplify the procedures for Indian Companies to attract foreign investments, I propose to do away with the distinction between different types of foreign investments, especially between foreign portfolio investments and foreign direct investments, and replace them with composite caps The sectors which are already on a 100% automatic route would not be affected.
  3. The ‘Act East’ policy of the Government of India endeavours to cultivate extensive economic and strategic relations in South-East Asia. In order to catalyze investments from the Indian private sector in this region, a Project Development Company will, through separate Special Purpose Vehicles (SPVs), set up manufacturing hubs in CMLV countries, namely, Cambodia, Myanmar, Laos and Vietnam.

Safe India

  1. My Government is committed to safety and security of women. In order to support programmes for women security, advocacy and awareness, I have decided to provide another ` 1,000 crore to the Nirbhaya Fund.

Tourism

  1. While India has 25 (twenty five) Cultural World Heritage Sites. These facilities are still deficient and require restoration, including landscape restoration; signage and interpretation centres; parking; access for the differently abled; visitors’ amenities, including securities and toilets; illumination and plans for benefiting communities around them.  I propose to provide resources to start work along these lines for the following Heritage Sites:

(i)       Churches & Convents of Old Goa

(ii)      Hampi, Karnataka

(iii)     Elephanta Caves, Mumbai

(iv)     Kumbalgarh and other Hill Forts of Rajasthan

(v)      Rani ki Vav, Patan, Gujarat

(vi)     Leh Palace, Ladakh, J&K

(vii)    Varanasi Temple town, UP

(viii)   Jalianwala bagh, Amritsar, Punjab

(ix)     Qutub Shahi Tombs, Hyderabad, Telengana

  1. After the success of VISAS on arrival issued to travelers of 43 countries, I propose to increase the countries covered to 150, in stages.

Green India

  1. Madam, as environmental degradation hurts the poor more than others, we are committed to make our development process as green as possible.  Our de facto ‘Carbon Tax’ on most petroleum products compares favourably with international norms.  With regard to coal, there is a need to find a balance between taxing pollution, and the price of power.  However, beginning this year, I intend to start on that journey too. My Government is also launching a Scheme for Faster Adoption and manufacturing of Electric Vehicles (FAME).  I am proposing an initial outlay of `75 crore for this Scheme in 2015-16.  The Ministry of New Renewable Energy has revised its target of renewable energy capacity to 1,75,000 MW till 2022, comprising 100,000 MW Solar, 60,000 MW Wind, 10,000 MW Biomass and 5000 MW Small Hydro.
  2. Madam, Speaker, we are putting the scam, scandal and corruption Raj behind us. Malfeasance in public procurement can perhaps be contained by having a procurement law and an institutional structure consistent with the UNCITRAL model.  I believe, Parliament needs to take a view soon on whether we need a procurement law, and if so, what shape it should take.
  3. On the other hand, disputes arising in public contracts take long to resolve, and the process is very costly too. My Government proposes to introduce a Public Contracts (Resolution of Disputes) Bill to streamline the institutional arrangements for resolution of such disputes.
  4. There is also a need, I feel, to tackle the lack of common approach and philosophy in the regulatory arrangements prevailing even within the different sectors of infrastructure. Our Government, therefore, also proposes to introduce a regulatory reform law that will bring about a cogency of approach across various sectors of infrastructure.

Skill India

  1. India is one of the youngest nations in the world with more than 54% of the total population below 25 years of age. Our young people have to be both educated and employable for the jobs of the 21st Century.  The Prime Minister has explained how Skill India needs to be closely coordinated with Make in India.  Yet today less than 5% of our potential workforce gets formal skill training to be employable and stay employable.
  2. We will soon be launching a National Skills Mission through the Skill Development and Entrepreneurship Ministry. The Mission will consolidate skill initiatives spread across several Ministries and allow us to standardize procedures and outcomes across our 31 Sector Skill Councils.
  3. With rural population still forming close to 70% of India’s population, enhancing the employability of rural youth is the key to unlocking India’s demographic dividend. With this in mind, we had launched the Deen Dayal Upadhyay Gramin Kaushal Yojana.  ` 1,500 crore has been set apart for this scheme.  Disbursement will be through a digital voucher directly into qualified student’s bank account.
  4. This is the year when we will be entering the 100th birth anniversary of Shri Deen Dayalji Upadhyay. The intention of the Government is to celebrate the anniversary of this great nationalist, in a befitting manner.  A 100th Birthday Celebration Committee will be announced soon, and adequate resources provided for the celebration.
  5. With a view to enable all poor and middle class students to pursue higher education of their choice without any constraint of funds, I propose to set up a fully IT based Student Financial Aid Authority to administer and monitor Scholarship as well Educational Loan Schemes, through the Pradhan Mantri Vidya Lakshmi Karyakram.  We will ensure that no student misses out on higher education for lack of funds.
  6. Hon’ble Members will remember that in the Budget Speech of July,
    I had indicated my intention to provide one major Central Institute in each State. In the fiscal year 2015-16, I propose to set up All India Institutes of Medical Sciences in J&K, Punjab, Tamil Nadu, Himachal Pradesh and Assam.  Keeping in view the need to augment Medical Sciences in Bihar, I propose to set up another AIIMS like institution in these States.  I propose to set up an IIT in Karnataka, and upgrade Indian School of Mines, Dhanbad into a full-fledged IIT.  I also propose to set up a Post Graduate Institute of Horticulture Research and Education in Amritsar.  IIMs will be  setup in J&K and Andhra Pradesh.  In Kerala, I propose to upgrade the existing National Institute of Speech and Hearing to a University of Disability Studies and Rehabilitation.  I also propose three new National Institutes of Pharmaceutical Education and Research: in Maharashtra, Rajasthan, and Chattisgarh; and an Institutes of Science and Education Research in Nagaland and Odisha.  I also propose to set up a Centre for Film Production, Animation and Gaming in Arunachal Pradesh, for the North-Eastern States; and Apprenticeship Training Institute for Women in Haryana and Uttrakhand.
  7. In order to improve the Governance of Public Sector banks, the Government intends to set up an autonomous bank Board Bureau. The Bureau will search and select heads of Public Sector banks and help them in developing differentiated strategies and capital raising plans through innovative financial methods and instruments. This would be an interim step towards establishing a holding and investment Company for Banks.

Digital India

  1. Madam, Speaker, I would like to inform the House we are making good progress towards making Digital India. The National Optical Fibre Network Programme (NOFNP) of 7.5 lakh kms. networking 2.5 lakh villages is being further speeded up by allowing willing States to undertake its execution, on reimbursement of cost as determined by Department of Telecommunications.  Andhra Pradesh is the first State to have opted for this manner of implementation.
  2. As Members are aware, in making their recommendations, the Finance Commission has not distinguished between special category and other states. Moreover, both Bihar and West Bengal are going to be amongst the biggest beneficiaries of the recommendations of the Finance Commission. Yet, the Eastern States have to be given an opportunity to grow even faster.  I, therefore, propose to give similar special assistance to Bihar and West Bengal as has been provided by the Government of India in the case of Government of Andhra Pradesh.  As regards Andhra Pradesh and Telengana, the Government is committed to comply with all the legal commitments made to these States at the time of reorganization.
  3. In spite of the large increase in devolution to states, which implies reduced fiscal space for the Centre in the same proportion we are committed to the welfare of the poor and the neo-middle class. Keeping this in mind, adequate provision is being made for the schemes for the poor and the dis-advantaged. Illustratively, I have allocated ` 68,968 crore to the education sector including mid-day meals, ` 33,152 crore to the health sector and ` 79,526 crore for rural development activities including MGNREGA, ` 22,407 crore for housing and urban development, ` 10,351 crore for women and child development, ` 4,173 crore for Water Resources and Namami Gange. The significant sums that will be spent by the States on these programmes will ensure a quantum leap in expenditures in these areas. I urge states to utilize their enhanced resources effectively in these areas.
  4. Madam, Speaker, I am delighted to report good progress for DMIC corridors: the Ahmedabad-Dhaulera Investment Region in Gujarat, and the Shendra–Bidkin Industrial Park near Aurangabad, in Maharashtra, are now in a position to start work on basic infrastructure. In the current year, I have earmarked an initial sum of ` 1,200 crore.  However, as the pace of expenditure picks up, I will provide them additional funds.
  5. Defence of every square inch of our mother land comes before anything else. So far, we have been over dependent on imports, with its attendant unwelcome spin-offs.  Our Government has already permitted FDI in defence so that the Indian-controlled entities also become manufacturers of defence equipments, not only for us, but for export.  We are thus pursuing the Make in India policy to achieve greater self-sufficiency in the area of defence equipment, including aircraft.  Members of this august House would have noted that we have been both transparent and quick in making  defence equipment related purchase decisions, thus keeping our defence forces ready for any eventuality.  This year too, I have provided adequately for the needs of the armed forces.  As against likely expenditure of this year of ` 2,22,370 crore the budget allocation for 2015-16 is ` 2,46,727 crore.
  6. While India produces some of the finest financial minds, including in international finance, they have few avenues in India to fully exhibit and exploit their strength to the country’s advantage. GIFT in Gujarat was envisaged as International Finance Centre that would actually become as good an International Finance Centre as Singapore or Dubai, which, incidentally, are largely manned by Indians.  The proposal has languished for years.  I am glad to announce that the first phase of GIFT will soon become a reality. Appropriate regulations will be issued in March.
  7. For the quick resolution of commercial disputes, the Government proposes to set up exclusive commercial divisions in various courts in India based on the recommendations of the 253rd Report of the Law Commission. The Government proposes to introduce a Bill in the parliament after consulting stakeholders in this regard.
  8. Madam Speaker, the Government will, during this session, also place before the Parliament the required Bills, to convert Ordinances issued by the Government into Acts of Parliament.

BUDGET ESTIMATES

  1. I now turn to the Budget Estimates for Budget 2015-16.
  2. Non-Plan expenditure estimates for the Financial Year are estimated at `13,12,200 crore. Plan expenditure is estimated to be ` 4,65,277 crore, which is very near to the R.E. of 2014-15.  Total Expenditure has accordingly been estimated at ` 17,77,477 crore. The requirements for expenditure on Defence, Internal Security and other necessary expenditures are adequately provided.
  3. Gross Tax receipts are estimated to be ` 14,49,490 crore. Devolution to the States is estimated to be  ` 5,23,958 crore.  Share of Central Government will be ` 9,19,842 crore.  Non Tax Revenues for the next fiscal are estimated to be  `2,21,733 crore.
  4. With the above estimates, fiscal deficit will be 3.9 per cent of GDP and Revenue Deficit will be 2.8 per cent of GDP.

 

 

PART  B

Madam Speaker,

  1. I now turn to my tax proposals.
  2. Taxation is an instrument of social and economic engineering. Tax collections help the Government to provide education, healthcare, housing and other basic facilities to the people to improve their quality of life and to address the problems of poverty, unemployment and slow development.  To achieve these objectives, it has been our endeavour in the last nine months to foster a stable taxation policy and non-adversarial tax administration.  A very important dimension to our tax administration is the fight against the scourge of black money.  A number of measures have already been taken in this direction. I propose to do much more.
  3. We need to revive growth and investment to ensure that more jobs are created for our youth and benefits of development reach millions of our poor. We need an enabling tax policy for this.  I have already introduced the Bill to amend the Constitution of India for Goods and Services Tax (GST) in the last Session of this august House.  GST is expected to play a transformative role in the way our economy functions.  It will add buoyancy to our economy by developing a common Indian market and reducing the cascading effect on the cost of goods and services.  We are moving in various fronts to implement GST from the next year.
  4. We need to match this transformative piece of legislation in indirect taxation with transformative measures in direct taxation. The basic rate of Corporate Tax in India at 30% is higher than the rates prevalent in the other major Asian economies, making our domestic industry uncompetitive.  Moreover, the effective collection of Corporate Tax is about 23%.  We lose out on both counts, i.e. we are considered as having a high Corporate Tax regime but we do not get that tax due to excessive exemptions.  A regime of exemptions has led to pressure groups, litigation and loss of revenue.  It also gives room for avoidable discretion.  I, therefore, propose to reduce the rate of Corporate Tax from 30% to 25% over the next 4 years.  This will lead to higher level of investment, higher growth and more jobs.  This process of reduction has to be necessarily accompanied by rationalisation and removal of various kinds of tax exemptions and incentives for corporate taxpayers, which incidentally account for a large number of tax disputes.
  5. I wanted to start the phased reduction of corporate tax rate and phased elimination of exemptions right away; but I thought it would be appropriate to give advance notice that these changes will start from the next financial year. Our stated policy is to avoid sudden surprises and instability in tax policy.  Exemptions to individual taxpayers will, however, continue since they facilitate savings which get transferred to investment and economic growth.
  6. While finalising my tax proposals, I have adopted certain broad themes, which include:
  7. Measures to curb black money;
  8. Job creation through revival of growth and investment and promotion of domestic manufacturing and ‘Make in India’;
  9. Minimum government and maximum governance to improve the ease of doing business;
  10. Benefits to middle class taxpayers;
  11. Improving the quality of life and public health through Swachch Bharat initiatives; and
  12. Stand alone proposals to maximise benefits to the economy.
  13. Madam Speaker, the first and foremost pillar of my tax proposals is to effectively deal with the problem of black money which eats into the vitals of our economy and society. The problems of poverty and inequity cannot be eliminated unless generation of black money and its concealment is dealt with effectively and forcefully.
  14. In the last 9 months several measures have been initiated in this direction. A major breakthrough was achieved in October, 2014 when a delegation from the Revenue Department visited Switzerland and the Swiss authorities agreed to (a) provide information in respect of cases independently investigated by the Income-tax Department; (b) confirm genuineness of bank accounts and provide non-banking information; (c) provide such information in a time bound manner; and (d) commence talks with India for Automatic Exchange of Information between the two countries at the earliest.  Investigation into cases of undisclosed foreign assets has been accorded the highest priority, resulting in detection of substantial amounts of unreported income.  For strengthening collection of information from various sources domestically, a new structure is being put in place which includes electronic filing of statements by reporting entities.  This will ensure seamless integration of data and more effective enforcement.
  15. Tracking down and bringing back the wealth which legitimately belongs to the country is our abiding commitment to the country. Recognising the limitations under the existing legislation, we have taken a considered decision to enact a comprehensive new law on black money to specifically deal with such money stashed away abroad.  To this end, I propose to introduce a Bill in the current Session of the Parliament.
  16. With your permission, Madam Speaker, I would like to highlight some of the key features of the proposed new law on black money.

(1)   Concealment of income and assets and evasion of tax in relation to foreign assets will be prosecutable with punishment of rigorous imprisonment upto 10 years.  Further,

  • this offence will be made non-compoundable;
  • the offenders will not be permitted to approach the Settlement Commission; and
  • penalty for such concealment of income and assets at the rate of 300% of tax shall be levied.

(2)   Non filing of return or filing of return with inadequate disclosure of foreign assets will be liable for prosecution with punishment of rigorous imprisonment up to 7 years.

(3)   Income in relation to any undisclosed foreign asset or undisclosed income from any foreign asset will be taxable at the maximum marginal rate.  Exemptions or deductions which may otherwise be applicable in such cases, shall not be allowed.

(4)   Beneficial owner or beneficiary of foreign assets will be mandatorily required to file return, even if there is no taxable income.

(5)   Abettors of the above offences, whether individuals, entities, banks or financial institutions will be liable for prosecution and penalty.

(6)   Date of Opening of foreign account would be mandatorily required to be specified by the assessee in the return of income.

(7)   The offence of concealment of income or evasion of tax in relation to a foreign asset will be made a predicate offence under the Prevention of Money-laundering Act, 2002 (PMLA). This provision would enable the enforcement agencies to attach and confiscate unaccounted assets held abroad and launch prosecution against persons indulging in laundering of black money.

(8)   The definition of ‘proceeds of crime’ under PMLA is being amended to enable attachment and confiscation of equivalent asset in India where the asset located abroad cannot be forfeited.

(9)   The Foreign Exchange Management Act, 1999 (FEMA) is also being amended to the effect that if any foreign exchange, foreign security or any immovable property situated outside India is held in contravention of the provisions of this Act, then action may be taken for seizure and eventual confiscation of assets of equivalent value situated in India.  These contraventions are also being made liable for levy of penalty and prosecution with punishment of imprisonment up to five years.

  1. As regards curbing domestic black money, a new and more comprehensive Benami Transactions (Prohibition) Bill will be introduced in the current session of the Parliament. This law will enable confiscation of benami property and provide for prosecution, thus blocking a major avenue for generation and holding of black money in the form of benami property, especially in real estate.
  2. A few other measures are also proposed in the Budget for curbing black money within the country. The Finance Bill includes a proposal to amend the Income-tax Act to prohibit acceptance or payment of an advance of `20,000 or more in cash for purchase of immovable property.  Quoting of PAN is being made mandatory for any purchase or sale exceeding the value of `1 lakh.  The third party reporting entities would be required to furnish information about foreign currency sales and cross border transactions.  Provision is also being made to tackle splitting of reportable transactions.  To improve enforcement, CBDT and CBEC will leverage technology and have access to information in each other’s database.
  3. Madam Speaker, the second pillar of my taxation proposals this year is job creation through revival of growth and investment and promotion of domestic manufacturing and ‘Make in India’. I propose to undertake a series of steps in this direction to attract capital, both domestic and foreign.  Tax ‘pass through’ is proposed to be allowed to both Category-I and Category-II Alternative Investment Funds, so that tax is levied on the investors in these Funds and not on the Funds per se.  This will step up the ability of these Funds to mobilise higher resources and make higher investments in small and medium enterprises, infrastructure and social projects and provide the much required private equity to new ventures and start-ups.
  4. A step was taken in the last Budget to encourage Real Estate Investment Trusts (REITs) and Infrastructure Investments Trusts (InvITs) by providing partial pass through to them. These collective investment vehicles have an important role to revive construction activity.  A large quantum of funds is locked up in various completed projects which need to be released to facilitate new infrastructure projects to take off.   I therefore propose to rationalise the capital gains regime for the sponsors exiting at the time of listing of the units of REITs and InvITs, subject to payment of Securities Transaction Tax (STT).  The rental income of REITs from their own assets will have pass through facility.
  5. The present taxation structure has an inbuilt incentive for fund managers to operate from offshore locations. To encourage such offshore fund managers to relocate to India, I propose to modify the Permanent Establishment (PE) norms to the effect that mere presence of a fund manager in India would not constitute PE of the offshore funds resulting in adverse tax consequences.
  6. Implementation of the General Anti Avoidance Rule (GAAR) has been a matter of public debate. The investment sentiment in the country has now turned positive and we need to accelerate this momentum.  There are also certain contentious issues relating to GAAR which need to be resolved.  It has therefore been decided to defer the applicability of GAAR by two years.   Further, it has also been decided that when implemented, GAAR would apply prospectively to investments made on or after 01.04.2017.
  7. Today I see a lot of young entrepreneurs running business ventures or wanting to start new ones. They need latest technology.  Therefore, to facilitate technology inflow to small businesses at low costs, I propose to reduce the rate of income tax on royalty and fees for technical services from 25% to 10%.
  8. To generate greater employment opportunities, it is proposed to extend the benefit of deduction for employment of new regular workmen to all business entities. The eligibility threshold of minimum 100 regular workmen is being reduced to fifty.
  9. The role of indirect taxes is also very important in the context of promotion of domestic manufacturing and Make in India. In indirect taxes, therefore, I propose to reduce the rates of basic customs duty on certain inputs, raw materials, intermediates and components (in all 22 items) so as to minimise the impact of duty inversion and reduce the manufacturing cost in several sectors.   Some other changes address the problem of CENVAT credit accumulation due to the levy of SAD.  I propose to fully exempt all goods, except populated printed circuit boards for use in manufacture of ITA bound items from SAD and reduce the SAD on imports of certain other inputs and raw materials subject to actual user condition. These changes are detailed in the Annexure to the Budget Speech.
  10. My next proposal is regarding minimum government and maximum governance with focus on ease of doing business and simplification of Tax Procedures without compromising on tax revenues. The total wealth tax collection in the country was `1,008 crore in 2013-14.  Should a tax which leads to high cost of collection and a low yield be continued or should it be replaced with a low cost and higher yield tax?  The rich and wealthy must pay more tax than the less affluent ones.  I have therefore decided to abolish the wealth tax and replace it with an additional surcharge of 2% on the super-rich with a taxable income of over `1 crore.  This will lead to tax simplification and enable the Department to focus more on ensuring tax compliance and widening the tax base. As against a tax sacrifice of `1,008 crore, through these measures the Department would be collecting about `9,000 crore from the 2% additional surcharge.  Further, to track the wealth held by individuals and entities, the information regarding the assets which are currently required to be furnished in wealth-tax return will be captured in the income tax returns.  This will ensure that the abolition of wealth tax does not lead to escape of any income from the tax net.
  11. The provision relating to indirect transfers in the Income-tax Act which is a legacy from the previous government contains several ambiguities. This provision is being suitably cleaned up. Further, concerns regarding applicability of indirect transfer provisions to dividends paid by foreign companies to their shareholders will be addressed by the Central Board of Direct Taxes through a clarificatory circular.  These changes would eliminate the scope for discretionary exercise of power and provide a hassle free structure to the taxpayers. I reiterate what I had said in the last Budget that ordinarily retrospective tax provisions adversely impact the stability and predictability of the taxation regime and resort to such provisions shall be avoided.
  12. Further, to reduce the associated hassles to smaller taxpayers and the compliance costs in domestic transfer pricing, I propose to increase the threshold limit from `5 crore to `20 crore.
  13. In order to rationalise the MAT provisions for FIIs, profits corresponding to their income from capital gains on transactions in securities which are liable to tax at a lower rate, shall not be subject to MAT.
  14. The Tax Administration Reform Commission (TARC) has given a number of recommendations to improve the administration in the Tax Departments. These recommendations are in advanced stage of examination and will be appropriately implemented during the course of this year.
  15. As part of the movement towards GST, I propose to subsume the Education Cess and the Secondary and Higher Education Cess in Central Excise duty. In effect, the general rate of Central Excise Duty of 12.36% including the cesses is being rounded off to 12.5%.  I also propose to revise the specific rates of Central Excise duty in certain other commodities, as detailed in the Annexure.  However, in the case of petrol and diesel such specific rates are being revised only to the extent of subsuming the quantum of education cess presently levied on them, keeping the total incidence of excise duties unchanged.  The ad-valorem rates of excise duty lower than 12% and those higher than 12% with a few exceptions are not being increased.  Some changes are also being made to excise levy on cigarettes and the compounded levy scheme applicable to pan masala, gutkha and certain other tobacco products.
  16. To give a boost to domestic leather footwear industry, the excise duty on footwear with leather uppers and having retail price of more than `1000 per pair is being reduced to 6%.
  17. To further facilitate the ease of doing business, online central excise and service tax registration will be done in two working days. The assessees under these taxes will be allowed to issue digitally signed invoices and maintain electronic records.  These measures will cut down lot of paper work and red tape. Time limit for taking CENVAT credit on inputs and input services is being increased from six months to one year as a measure of business facilitation.
  18. Introduction of GST is eagerly awaited by Trade and Industry. To facilitate a smooth transition to levy of tax on services by both the Centre and the States, it is proposed to increase the present rate of service tax plus education cesses from 12.36% to a consolidated rate of 14%.
  19. Madam Speaker, cleanliness of households and clean environment are very important social causes. The fourth pillar of my taxation proposals this year therefore relates to initiatives for the Swachh Bharat Abhiyan.  In my direct tax proposals, I have proposed 100% deduction for contributions, other than by way of CSR contributions, to the Swachh Bharat Kosh.  A similar tax treatment is also proposed for the Clean Ganga Fund.
  20. In indirect taxes, I propose to increase the Clean Energy Cess from `100 to `200 per metric tonne of coal, etc. to finance clean environment initiatives. Excise duty on sacks and bags of polymers of ethylene other than for industrial use is being increased from 12% to 15%.  It is also proposed to have an enabling provision to levy Swachh Bharat Cess at a rate of 2% or less on all or certain services if need arises.  This Cess will be effective from a date to be notified.  Resources generated from this cess will be utilised for financing and promoting initiatives towards Swachh Bharat.
  21. It is also proposed to exempt services by common affluent treatment plants from service tax. The concessions from customs and excise duties currently available on specified parts for manufacture of electrically operated vehicles and hybrid vehicles are being extended by one more year i.e. up to 31.3.2016.
  22. Madam Speaker, the fifth pillar of my taxation proposals this year is extension of benefits to middle class tax payers. The proposals in this regard are as follows :
  • Increase in the limit of deduction in respect of health insurance premium from `15,000 to `25,000.

o  For senior citizens the limit will stand increased to `30,000  from the existing `20,000.

o  For very senior citizens of the age of 80 years or more, who are not covered by health insurance, deduction of  ` 30,000 towards expenditure incurred on their treatment will be allowed.

  • The deduction limit of ` 60,000 towards expenditure on account of specified diseases of serious nature is proposed to be enhanced to `80,000 in case of very senior citizens.
  • Additional deduction of ` 25,000 will be allowed for differently abled persons under Section 80DD and Section 80U of the Income-tax Act.
  • The limit on deduction on account of contribution to a Pension Fund and the New Pension Scheme is proposed to be increased from`1 lakh to `1.5 lakh.
  • To provide social safety net and the facility of pension to individuals, an additional deduction of ` 50,000 is proposed to be provided for contribution to the New Pension Scheme under Section 80CCD. This will enable India to become a pensioned society instead of a pensionless society.
  • Investments in Sukanya Samriddhi Scheme is already eligible for deduction under Section 80C. All payments to the beneficiaries including interest payment on deposit will also be fully exempt.
  • Transport allowance exemption is being increased from `800 to `1,600 per month.
  • For the benefit of senior citizens, service tax exemption will be provided on Varishta Bima Yojana.
  1. Madam Speaker, I am giving these concessions to individual taxpayers despite inadequate fiscal space. After taking into account the tax concession given to middle class tax payers in my last Budget and this Budget, today an individual tax payer will get tax benefit of `4,44,200 as detailed in the annexure.  As and when my fiscal capacity improves, individual taxpayers will have a lot to look forward to.
  2. Madam Speaker, there are several stand-alone proposals relating to taxation. These include conversion of existing excise duty on petrol and diesel to the extent of `4 per litre into Road Cess to fund investment in roads and other infrastructure.  An additional sum of ` 40,000 crore will be made available through this measure for these sectors.  In service tax, exemption is being extended to certain pre cold storage services in relation to fruits and vegetables so as to incentivise value addition in this crucial sector.  The Negative List under service tax is being slightly pruned and certain other exemptions are being withdrawn to widen the tax base.
  3. Yoga is India’s well acknowledged gift to the world. It is proposed to include yoga within the ambit of charitable purpose under Section 2(15) of the Income-tax Act.  Further, to mitigate the problem being faced by many genuine charitable institutions, it is proposed to modify the ceiling on receipts from activities in the nature of trade, commerce or business to 20% of the total receipts from the existing ceiling of `25 lakh.  A national database of non profit organisations is also being developed.
  4. Enactment of a Direct Taxes Code (DTC) has been under discussion for quite some time. Most of the provisions of the DTC have already been included in the Income-tax Act.  Among the very few aspects of DTC which were left out, we have addressed some of the issues in the present Budget.  Further, the jurisprudence under the Income-tax Act is well evolved. Considering all these aspects, there is no great merit in going ahead with the Direct Tax Code as it exists today.
  5. Madam Speaker, the details of direct and indirect tax proposals are given in the Annexure to the Budget speech and the other budget documents laid on the Table of the House. My direct tax proposals would result in revenue loss of `8,315 crore, whereas the proposals in indirect taxes are expected to yield `23,383 crore.  Thus, the net impact of all tax proposals would be revenue gain of `15,068 crore.

CONCLUSION

  1. To conclude, Madam Speaker, it is no secret that expectations of this Budget have been high. People who urge us to undertake Big Bang Reforms, also say that the Indian economy is a giant super tanker, or an elephant.  An elephant, Madam Speaker, moves slowly but surely.  Even our worst critics would admit that we have moved rapidly.  In this speech, I think I have clearly outlined not only what we are going to do immediately, but also a roadmap for the future.
  2. I think I can genuinely stake, for our Government, a claim of intellectual honesty. We have been consistent in what we have said, and what we are doing.  We are committed, Madam Speaker, to achieving what we have been voted to power for:  Change, growth, jobs and genuine, effective upliftment of the poor and the under-privileged.  Our commitment to the ‘Daridra Narayan’ is steadfast, as is commitment to the Constitutional principles of Equality and Justice for All, without concern for caste, creed or religion.  This will be in the spirit of the Upanishad-inspired mantra:

Om Sarve Bhavantu Sukhinah

            Sarve Santu Nir-Aamayaah

            Sarve Bhadraanni Pashyantu

            Maa Kashcid-Duhkha-Bhaag-Bhavet 

            Om Shaantih Shaantih Shaantih 

            (OM! May All Be Happy

May All Be Free From Illness

May All See What is Beneficial

May No One Suffer)

  1. With these words, Madam Speaker, I commend the Budget to the House.

 Here are the highlights of the Union Budget 2015:

Fiscal deficit

* Fiscal deficit seen at 3.9 per cent of GDP in 2015/16

* Will meet the challenging fiscal target of 4.1 per cent of GDP

* Remain committed to meeting medium term fiscal deficit target of 3 per cent of GDP

* Current account deficit below 1.3 per cent of GDP

* Jaitley says have to keep fiscal discipline in mind despite need for higher investment

Growth

* GDP growth seen at between 8 per cent and 8.5 per cent y/y

* Aiming double digit growth rate, achievable soon

Inflation

* Expects consumer inflation to remain close to 5 per cent by March, opening room for more monetary policy easing

* Monetary policy framework agreement with the RBI clearly states objective of keeping inflation below 6 per cent

* “One of the achievements of my government has been to conquer inflation. This decline in my view represents a structural shift.”

Revenues * Revenue deficit seen at 2.8 per cent of GDP

* Non tax revenue seen at Rs 2.21 trillion

* Agricultural incomes are under stress

Disinvestment

* Government targets Rs 410 billion from stake sales in companies

* Total stake sale in 2015/16 seen at Rs 695 billion

Market reforms

* Propose to merge commodities regulator with SEBI

* To bring a new bankruptcy code

* Jaitley says will move to amend the RBI act this year, and provide for a monetary policy committee

* To set up public debt management agency

* Proposes to introduce a public contract resolution of disputes bill

* To establish an autonomous bank board bureau to improve management of public sector banks

Policy reforms

* To enact a comprehensive new law on black money

* Propose to create a universal social security system for all Indians

* To launch a national skills mission soon to enhance employability of rural youth

* To raise visa-on-arrival facility to 150 countries from 43

* Allocates Rs 346.99 billion for rural employment guarantee scheme

Borrowing

* Gross market borrowing seen at Rs 6 trillion

* Net market borrowing seen at Rs 4.56 trillion

General anti-avoidance rules (GAAR)

* Government defers rollout of anti-tax avoidance rules GAAR by two years

* GAAR to apply prospectively from April 1, 2017

* Retrospective tax provisions will be avoided

Taxation

* To abolish wealth tax

* Replaces wealth tax with additional 2 per cent surcharge on super rich

* Proposes to cut to 25 per cent corporate tax over next four years

* Corporate tax of 30 per cent is uncompetitive

* Net gain from tax proposals seen at Rs 150.68 billion

* Jaitley proposes modification of permanent establishment norms so that the mere presence of a fund manager in India would not constitute a permanent establishment of the offshore fund, resulting in adverse tax consequences.

* Proposes to rationalise capital gains tax regime for real estate investment trusts

* Expects to implement goods and services tax by April 2016

* To reduce custom duty on 22 items

* Basic custom duty on commercial vehicle doubled to 20 per cent

* Proposes to increase service tax rate and education cess to 14 per cent from 12.36 per cent

* Plans to introduce direct tax regime that is internationally competitive on rates without exemptions

* Exemptions for individual tax payers to continue

* To enact tough penalties for tax evasion in new bill

* Tax department to clarify indirect transfer of assets and dividend paid by foreign firms

Infrastructure

* Investment in infrastructure will go up by Rs 700 billion in 2015/16 over last year

* Plans to set up national investment infrastructure fund

* Proposes tax-free infrastructure bonds for projects in roads, rail and irrigation projects

* Proposes 5 “ultra mega” power projects for 4,000MW each

* Second unit of Kudankulam nuclear power station to be commissioned

* Will need to build additional 100,000km of road

* Ports in public sector will be encouraged to corporatise under Companies Act

Expenditure

* Plan expenditure estimated at about Rs 4.65 trillion

* Non-plan expenditure seen at about Rs 13.12 trillion

* Allocates Rs 2.46 trillion for defence spending

* Allocates Rs 331.5 billion for health sector

* If revenue improves, hope to raise budgeted allocations for rural job scheme by Rs 50 billion

Investment

* Propose to do away with different types of foreign investment caps and replace them with composite caps

* To allow foreign investment in alternative investment funds

* Public investment needed to catalyse investment

Gold

* To develop a sovereign gold bond

* To introduce gold monetisation scheme to allow depositors to earn interest

* To introduce Indian-made gold coin to reduce demand for foreign gold coins

Subsidies

* Food subsidy seen at Rs 1.24 trillion

* Fertiliser subsidy seen at Rs 729.69 billion

* Fuel subsidy seen at Rs 300 billion

* We are committed to subsidy rationalisation based on cutting leakages

Finance minister’s comments

* “We inherited a sentiment of doom and gloom. The investment community had almost written us off. We have come a long way since then.”

* “We have turned around the economy, dramatically restoring macroeconomic stability and creating the conditions for sustainable poverty elimination, job creation, durable double digit economic growth.”

* “While being mindful of the challenges … this gives us reason to feel optimistic.”

* “Domestic and international investors are seeing us with renewed interest and hope.”

  • Allocation of Natural Resources: Auction of coal, reform in the mining sector to see that resources are used for development of the country and its people;
  • Financial Inclusion: through the Pradhan Mantri Jan Dhan Yojana-making every Indian a part of the financial system;
  • Health and hygiene of the common man: Launched a successful campaign of Swachh Bharat to ensure cleanliness, leading to better productivity and well being of the poor;
  • Girl Child & their Education: Started a drive for constructing toilets in the remaining elementary schools and also Launched the Beti Bachao-Beti padhao campaign;
  • Creation of Employment for the Youth: Launched the ‘Make in India’ campaign and combined it with a detailed process and policy re-engineering to make India a Global Manufacturing Hub for creation of job opportunities for millions of youth;
  • Hassle Free Business Environment: Created a non-adversarial tax regime, ending tax terrorism; Secured the political agreement on the goods and services tax (GST), that will allow legislative passage of the constitutional amendment bill;
  • Delivery of benefits to the poor made efficient: Started direct transfer of cooking gas subsidy on a national scale by use of technology;
  • Attracting Investment to create Jobs: Increased FDI caps in defence, Insurance and Railway Infrastructure; rationalised the conditions for FDI in construction and medical devices sectors;
  • Expanding the job market and ensuring welfare of the labour: Facilitated Sates which work to improve its Labour Laws and brought systemic changes in the area through the umbrella programme of ‘Shrameva Jayate’;
  • Better agri-productivity; more income to farmers: Launched the programme for Soil Health cards for better productivity in agriculture;
  • Energising the country: Brought rapid growth in power sector inspite of uncertainty on the coal front and launched ambitious programmes for new and renewable energy;
  • Technology-from grass root to the Space: Launched the Digital India programme to make India a knowledge & innovation based society with Broadband connectivity being taken to all villages, Success of Mars Orbiter Mission;
  • Skill India programme: Created a separate Ministry for skill development which is about to launch a massive programme;
  • Efficiency & better work culture in Government: Brought a culture of responsibility without fear, and with efficiency and transparency; created an environment of trusting the citizens-encouraging self-certification in a number of areas;
  • Red tape to Red carpet: Ending the red tape, created the ‘Ease of Doing Business’ in India by reforming and rationalising a large number of procedures, rules and regulations;
  • North-eastern part of the country brought in the mainstream: North East given special priority in the development process by two visits of PM and launch of important infrastructure projects;
  • Pride in the Nation and its culture: Brought out India’s cultural and spiritual strength through UNO’s recognition for Yoga, Namami Gange, Ghat and heritage city development programmes.

Annexure to part-b of the budget speech

The Finance Bill, 2015 proposes to make amendments in the Income-tax Act, 1961, Wealth-tax Act, 1957, Excise Tariff Act, Customs Act, Finance Act, 1994 and Finance (No.2) Act, 2004.  A gist of the main amendments is given below:-

Direct Taxes

  1. Rates of tax

2.1       It is proposed that there will be no change in the rate of personal income-tax and the rate of tax for companies in respect of income earned in the financial year 2015-16, assessable in the assessment year 2016-17.

2.2       It is further proposed to levy a surcharge @12% on individuals, HUFs, AOPs, BOIs, artificial juridical persons, firms, cooperative societies and local authorities having income exceeding ` 1 crore.  Surcharge in the case of domestic companies having income exceeding ` 1 crore and upto ` 10 crore is proposed to be levied @ 7% and surcharge @ 12% is proposed to be levied on domestic companies having income exceeding ` 10 crore.

2.3       It is further proposed that in the case of foreign companies the surcharge will continue to be levied @2% if the income exceeds ` 1 crore and is upto ` 10 crore, and @5% if the income exceeds ` 10 crore.

2.4       It is also proposed to levy a surcharge @12% as against current rate of 10% on additional income-tax payable by companies on distribution of dividends and buyback of shares, or by mutual funds and securitisation trusts on distribution of income.

2.5       The education cess on income-tax @ 2% for fulfilment of the commitment of the Government to provide and finance universalised quality based education and 1% of additional surcharge called ‘Secondary and  Higher Education Cess’ on tax and surcharge is proposed to be continued for the financial year 2015-16 for all taxpayers.

  1. A. Measures to curb black money

3.1       With a view to curbing the generation of black money in real estate, it is proposed to amend the provisions of section 269SS and 269T of the Income-tax Act so as to prohibit acceptance or re-payment of advance in cash of ` 20,000 or more for any transaction in immovable property.  It is also proposed to provide a penalty of an equal amount in case of contravention of such provisions.

3.2       Offence of making false declaration/documents in the transaction of any business relating to Customs (section 132 of the Customs Act) to be predicate offence under PMLA to curb trade based money laundering.

  1. B. Job creation through revival of growth and investment and promotion of domestic ‘manufacturing’ and ‘Make in India’.

4.1       Taking into account the representations received from various stakeholders and international developments in this regard, it is proposed to defer applicability of General Anti Avoidance Rule (GAAR) by 2 years.  Accordingly, it is proposed to be applicable for income of the financial year 2017-18 (A.Y. 2018-19) and subsequent years.  It is also proposed that the investments made upto 31.03.2017 shall not be subjected to GAAR.

4.2       With a view to streamline the taxation regime of Alternative Investment Funds (AIFs), it is proposed to provide pass through status to all the sub-categories of category-I and also to category-II AIFs governed by the regulations of Securities and Exchange Board of India (SEBI).

4.3       With a view to facilitate relocation of fund managers of offshore funds in India, it is proposed to modify the permanent establishment (PE) norms.

4.4       With a view to give effect to the provisions of section 94 of the Andhra Pradesh Reorganisation Act, 2014, it is proposed to provide an additional investment allowance (@15%) and additional depreciation (@15%) to new manufacturing units set-up during the period 01.04.2015 to 31.03.2020 in notified areas of Andhra Pradesh and Telangana.

4.5       In respect of Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (INViTs), it is proposed to provide that the sponsor will be given the same treatment on offloading of units at the time of listing as would have been available to him if he had offloaded his shareholding of special purpose vehicle (SPV) at the stage of direct listing.  Further, the rental income arising from real estate assets directly held by the REIT is also proposed to be allowed to pass through and to be taxed in the hands of the unit holders of the REIT.

4.6       It is proposed to amend the provisions of section 194LD of the Income-tax Act so as to extend the period of applicability of reduced rate of tax at 5% in respect of income of foreign investors (FIIs and QFIs) from corporate bonds and government securities, from 31.5.2015 to 30.06.2017.

4.7       With a view to obviate the problems faced by small companies and to facilitate the inflow of technology, it is proposed to amend the provisions of section 115A of the Income-tax Act so as to reduce the rate of tax on royalty and fees for technical services from 25% to 10%.

4.8       With a view to facilitating generation of employment, it is proposed to amend the provisions of section 80JJAA of the Income-tax Act so as to provide that tax benefit under the said section shall be available to a ‘person’ deriving profits from manufacture of goods in a factory and paying wages to new regular workmen. The eligibility threshold of minimum 100 workmen is proposed is to reduced to fifty.

4.9       Additional depreciation @ 20% is allowed on new plant and machinery installed by a manufacturing unit or a unit engaged in generation and distribution of power.  However, if the asset is installed after 30th September of the previous year only 10% of the additional depreciation is allowed.  It is proposed to allow the remaining 10% of the additional depreciation in the subsequent previous year.

  1. C. Minimum government and maximum goverance to improve the ease of doing business

5.1       Section 9 of the Income-tax Act was amended by Finance Act, 2012 to clarify that if an asset, being a share of, or interest, in a company or an entity derives its value, directly or indirectly, substantially from an asset situated in India, the gain arising from transfer of such share or interest shall be taxable in India.   After the clarificatory amendment, a large number of representations were received from various quarters seeking clarification on certain terms used in the amended provisions.  An Expert Committee was also constituted to look into the concerns. Taking into account the recommendations made by the Expert Committee and the concerns raised by the various stakeholders, it is proposed to amend the provisions of the Income-tax Act so as to provide that:-

  • the share or interest shall be deemed to derive its value substantially from the assets located in India, if on the specified date, the value of such assets represents at least fifty per cent of the fair market value of all the assets owned by the company or entity. However, the indirect transfer provisions would not apply if the value of Indian assets does not exceed ` 10 crore.  Further, the principle of proportionality will apply to the taxation of gains arising from indirect transfer of Indian assets.
  • the Indian entity shall be obligated to furnish information relating to the offshore transactions having the effect of directly or indirectly modifying the ownership structure or control of the Indian company or entity. In case of non-compliance, a penalty is also proposed.
  • the indirect transfer provisions shall not apply in a case where the transferor of share or interest in a foreign entity, along with his associated enterprises, neither holds the right of control or management nor holds voting power or share capital or interest exceeding five percent. of the total voting power or total share capital in the foreign company or entity, directly or indirectly, holding the Indian assets.
  • the capital gains shall be exempt in respect of transfer of share of a foreign company deriving its value, directly or indirectly, substantially from the shares of an Indian company, under a scheme of amalgamation or demerger.

5.2       It is proposed to amend the provisions of section 92BA of the Income-tax Act so as to increase the threshold limit for applicability of transfer pricing regulations to specified domestic transactions from `5 crore to `20 crore.

5.3       It is proposed to amend the provisions of section 2(15) of the Income-tax Act so as to include ‘yoga’ as a specific category of activity in the definition of ‘charitable purpose’ and also to provide relief for activities in the nature of business undertaken by genuine charitable organizations subject to the condition that aggregate receipts from such activity is less than 20% of the total receipts.

5.4       It is proposed to exempt the income of Core Settlement Guarantee Fund established by Clearing Corporations as per mandate of SEBI.

5.5       It is proposed to amend the provisions of section 255 of the Income-tax Act so as to increase the monetary limit from ` 5 lakh to ` 15 lakh, for a case to be heard by a Single Member Bench of the ITAT.

5.6       It is proposed to amend the provisions of the Income-tax Act so as to provide tax neutrality on transfer of units of a scheme of a Mutual Fund under the process of consolidation of schemes of Mutual Funds as per SEBI Regulations, 1996.

5.7       It is proposed to amend the provisions of the Income-tax Act so as to provide a mechanism to pre-empt the repetitive appeals by the revenue in the same assessee’s case on the same question of law year after year.

5.8       It is proposed to empower the Board to prescribe rules for grant of relief in respect of taxes paid in foreign jurisdictions.

5.9       It is proposed to abolish the levy of Wealth-tax with effect from 2016-17 (Assessment Year) for reducing the compliance burden on the tax payers. The revenue loss on account of such abolition is proposed to be compensated by increase in the existing surcharge by 2% in case of domestic companies and all non corporate taxpayers.

5.10     With a view to rationalise the dispute resolution mechanism available to taxpayer in the form of Settlement Commission, it is proposed to provide that while making an application to the Settlement Commission for an assessment year which has been re-opened by the Assessing Officer, the assessee can make an application for other assessment years in which the proceedings could be re-opened provided the return of income for such assessment years has been furnished by the assessee.

  1. D. Improving the quality of life and public health through Swachh Bharat Initiatives

6.1       It is proposed to provide that the donations (other than the CSR contributions made in accordance with section 135 of the Companies Act, 2013) made to Swachch Bharat Kosh (by both resident and non-resident) and Clean Ganga Fund (by resident) shall be eligible for 100% deduction under section 80G of the Income-tax Act.

  1. E. Benefits to middle class taxpayers

With a view to encourage savings and to promote health care among individual taxpayers, a number of measures are proposed to be taken by way of incentives under the Income-tax Act.  The same are enumerated below:-

7.1       It is proposed to provide that investment in Sukanya Samriddhi Scheme will be eligible for deduction u/s 80C and any payment from the scheme shall not be liable to tax.

7.2       It is proposed to increase the limit of deduction u/s 80D of the Income-tax Act from ` 15,000 to ` 25,000 on health insurance premium (in case of senior citizen from ` 20,000 to ` 30,000). It is also proposed to allow deduction of expenditure of similar amount in case of a very senior citizen not eligible to take health insurance.

7.3       It is proposed to increase the limit of deduction in case of very senior citizens u/s 80DDB of the Income-tax Act on expenditure on account of specified diseases from ` 60,000 to ` 80,000.

7.4       It is proposed to increase the limit of deduction u/s 80DD of the Income-tax Act in respect of maintenance, including medical treatment of a dependant who is a person with disability, from ` 50,000 to `75,000.  It is also proposed to increase the limit of deduction from ` 1 lakh to `1.25 lakh in case of severe disability.

7.5       It is proposed to increase the limit of deduction u/s 80U of the Income-tax Act in case of a person with disability, from ` 50,000 to ` 75,000.  It is also proposed to increase the limit of deduction from ` 1 lakh to `1.25 lakh in case of severe disability.

7.6       It is proposed to increase the limit of deduction u/s 80CCC of the Income-tax Act on account of contribution to a pension fund of LIC or IRDA approved insurer from ` 1 lakh to ` 1.5 lakh.

7.7       It is proposed to increase the limit of deduction u/s 80CCD of the Income-tax Act on account of contribution by the employee to National Pension Scheme (NPS) from ` 1 lakh to ` 1.50 lakh.  It is also proposed to provide a deduction of  upto ` 50,000 over and above the limit of ` 1.50 lakh in respect of contributions made to NPS.

7.8       It is proposed to amend the provisions of section 197A of the Income-tax Act so as to provide the facility of filing self-declaration of non-deduction of tax by the recipients of taxable maturity proceeds of life insurance policy.

7.9       Under the existing provisions of the Income-tax Act, an individual buying an immovable property from a resident is required to deduct tax but is not required to obtain TAN for depositing the tax so deducted.  With a view to extend the same facility to an individual or HUF purchasing an immovable property from a non-resident, it is proposed to relax the requirement of obtaining TAN by the individual or HUF who is required to deduct tax on acquisition of immovable property from a non-resident.

7.10     It is proposed to provide that donation made to National Fund for Control of Drug Abuse (NFCDA) shall be eligible for 100% deduction under section 80G of the Income-tax Act.

7.11     Details of tax deductions referred to in para 99.

  • Deduction u/s 80C                                           `1,50,000
  • Deduction u/s 80CCD                                        `50,000
  • Deduction on account of interest

on house property loan

(Self occupied property)                                  `2,00,000

  • Deduction u/s 80D on health                                                                              insurance premium        `25,000
  • Exemption of transport allowance                      `19,200

                    Total                                                                `4,44,200

  1. F. Stand alone proposals to maximise benefits to the economy

8.1       It is proposed to provide for chargeability of interest paid by a permanent establishment (PE) or a branch of foreign bank to its Head Office (HO) and other overseas branches under the source rule of taxation and for treating the PE or branch as a taxable entity for computation of income and for purpose of levy of TDS.

8.2       With a view to providing a uniform method of computation of period of stay in Indian for the purposes of determination of ‘resident’ status in the case of a India seafarer, whether working on a Indian-ship or foreign-ship, it is proposed to provide an enabling power to CBDT to prescribe the same in the rules.

8.3       In search cases, it is proposed to allow seized cash to be adjusted towards the assessee’s tax liability under his settlement application.

8.4       With a view to ensuring proper deduction of tax on payments made to non-residents, it is proposed to amend the provisions of section 195 of the Income-tax Act so as to provide for enabling power to the CBDT for capturing information about prescribed foreign remittances which are claimed to be not chargeable to tax.

INDIRECT TAXES

  1. Job creation through revival of growth and investment and promotion of domestic manufacturing and ‘Make in India’.

 

CUSTOMS

  1. Reduction in duty on certain inputs to address the problem of duty inversion:

1)        ‘Metal parts’ for use in the manufacture of electrical insulators.

2)        Ethylene-Propylene-non-conjugated-Diene Rubber (EPDM), Water blocking tape and Mica glass tape for use in the manufacture of insulated wires and cables.

3)        Magnetron upto 1 KW for use in the manufacture of microwave ovens.

4)        C- Block for Compressor, Over Load Protector (OLP) & Positive thermal co-efficient and Crank Shaft for compressor, for use in the manufacture of Refrigerator compressors.

5)        Zeolite, ceria zirconia compounds and cerium compounds for use in the manufacture of washcoats, which are further used in manufacture of catalytic converters.

6)        Anthraquinone for manufacture of hydrogen peroxide.

7)         Sulphuric acid for use in the manufacture of fertilizers.

8)        Parts and components of Digital Still Image Video Camera capable of recording video with minimum resolution of 800×600 pixels, at minimum 23 frames per second, for at least 30 minutes in a single sequence, using the maximum storage (including the expanded) capacity.

  1. Reduction in Basic Customs Duty to reduce the cost of raw materials:

1)        Ethylene dichloride (EDC), vinyl chloride monomer (VCM) and styrene monomer (SM) from 2.5% to 2%.

2)        Isoprene and Liquefied butanes from 5% to 2.5%.

3)        Butyl acrylate from 7.5% to 5%.

4)        Ulexite ore from 2.5% to Nil.

5)        Antimony metal, antimony waste and scrap from 5% to 2.5%.

6)        Specified components for use in the manufacture of specified CNC lathe machines and machining centres from 7.5% to 2.5%.

7)        Certain specified inputs for use in the manufacture of flexible medical video endoscopes from 5% to 2.5%.

8)        HDPE for use in the manufacture of telecommunication grade optical fibre cables from 7.5% to Nil.

9)        Black Light Unit Module for use in the manufacture of LCD/LED TV panels from 10% to Nil.

10)      Organic LED (OLED) TV panels from 10% to Nil.

11)      CVD and SAD are being fully exempted on specified raw materials [battery, titanium, palladium wire, eutectic wire, silicone resins and rubbers, solder paste, reed switch, diodes, transistors, capacitors, controllers, coils (steel), tubing (silicone)] for use in the manufacture of pacemakers.

12)      Evacuated Tubes with three layers of solar selective coating for use in the manufacture of solar water heater and system to Nil.

13)      Active Energy Controller (AEC) for use in the manufacture of Renewable Power System (RPS) Inverters to 5%, subject to certification by MNRE.

14)      Parts, components and accessories (falling under any Chapter) for use in the manufacture of tablet computers and their sub-parts for use in manufacture of parts, components and accessories are being fully exempted from BCD, CVD and SAD.

III.      Reduction in SAD to address the problem of CENVAT credit accumulation:

1)        All goods except populated PCBs, falling under any Chapter of the Customs Tariff, for use in manufacture of ITA bound goods from 4% to Nil.

2)        Naphtha, ethylene dichloride (EDC), vinyl chloride monomer (VCM) and styrene monomer (SM) for manufacture of excisable goods from 4% to 2%.

3)        Metal scrap of iron & steel, copper, brass and aluminium from 4% to 2%.

4)        Inputs for use in the manufacture of LED drivers and MCPCB for LED lights, fixtures and LED lamps from 4% to Nil.

  1. Increase in Basic Customs Duty:

1)        Metallurgical coke from 2.5% to 5%.

2)        Tariff rate on iron & steel and articles of iron or steel, falling under Chapters 72 and 73 of the Customs Tariff, from 10% to 15%. However, there is no change in the existing effective rates of basic customs duty on these goods.

3)        Tariff rate on Commercial Vehicles from 10% to 40% and effective rate from 10% to 20%. However, customs duty on commercial vehicles in Completely Knocked Down (CKD) kits and electrically operated vehicles including those in CKD condition will continue to be at 10%.

  1. Miscellaneous:

1)        Export duty on upgraded ilmenite is being reduced from 5% to 2.5%.

2)        Excise duty structure for mobiles handsets including cellular phones is being changed from 1% without CENVAT credit or 6% with CENVAT credit to 1% without CENVAT credit or 12.5% with CENVAT credit.

3)        Excise duty structure of 2% without CENVAT credit or 12.5% with CENVAT credit is being prescribed for tablet computers.

4)        Basic Customs Duty on Digital Still Image Video Camera capable of recording video with minimum resolution of 800×600 pixels, at minimum 23 frames per second, for at least 30 minutes in a single sequence, using the maximum storage (including the expanded) capacity is being reduced to Nil. Basic Customs Duty on parts and components of these cameras is also being reduced from 5% to Nil.

5)        Concessional customs duty structure of Nil Basic Customs Duty, 6% CVD and Nil SAD on specified parts of electrically operated vehicles and hybrid vehicles, presently available upto 31.03.2015, is being extended upto 31.03.2016.

EXCISE

  1. Excise duty structure on certain goods is being restructured as follows:

1)        Wafers for use in the manufacture of integrated circuit (IC) modules for smart cards from 12% to 6%.

2)        Inputs for use in the manufacture of LED drivers and MCPCB for LED lights, fixtures and LED lamps from 12% to 6%.

3)        Mobiles handsets, including cellular phones from 1% without CENVAT credit or 6% with CENVAT credit to 1% without CENVAT credit or 12.5% with CENVAT credit. NCCD of 1% on mobile handsets including cellular phones remains unchanged.

4)        Tablet computers from 12% to 2% without CENVAT credit or 12.5% with CENVAT credit.

5)        Specified raw materials [battery, titanium, palladium wire, eutectic wire, silicone resins and rubbers, solder paste, reed switch, diodes, transistors, capacitors, controllers, coils (steel), tubing (silicone)] for use in the manufacture of pacemakers to Nil.

6)        Pig iron SG grade and Ferro-silicon-magnesium for use in the manufacture of cast components of wind operated electricity generators to Nil, subject to certification by MNRE.

7)        Solar water heater and system from 12% to Nil without CENVAT credit or 12.5% with CENVAT credit.

8)        Round copper wire and tin alloys for use in the manufacture of Solar PV ribbon for manufacture of solar PV cells to Nil subject to certification by Department of Electronics and Information Technology (DeitY).

 

 

  1. Miscellaneous:

1)        Excise duty on leather footwear (footwear with uppers made of leather of heading 4107 or 4112 to 4114) of Retail Sale Price of more than ` 1000 per pair from 12% to 6%.

2)        Excise duty levied on the value of duty paid on rails for manufacture of railway or tramway track construction material is being exempted retrospectively for the period from 17.03.2012 to 02.02.2014, if no CENVAT credit of duty paid on such rails is availed.

  1. Mimimum government and maximum governance to improve the ease of design business
  2. Reduction in number of levies:

EXCISE

1)        Education Cess and Secondary & Higher Education Cess leviable on excisable goods are being subsumed in Basic Excise duty. Consequently, Education Cess and Secondary & Higher Education Cess leviable on excisable goods are being fully exempted. The standard ad valorem rate of Basic Excise Duty is being increased from 12% to 12.5% and specific rates of Basic Excise Duty on petrol, diesel, cement, cigarettes & other tobacco products (other than biris) are being suitably changed. However, the total incidence of various duties of excise on petrol and diesel remains unchanged. Other Basic Excise Duty rates (ad valorem as well as specific) with a few exceptions are not being changed. Customs Education Cesses will continue to be levied on imported goods.

  1. Ensure certainty and uniformity in valuation of the goods for the purposes of levy of excise duty:

1)        All goods falling under Chapter sub-heading 2101 20, including iced tea, are being notified under section 4A of the Central Excise Act for the purpose of assessment of Central Excise duty with reference to the Retail Sale Price with an abatement of 30%. Such goods are also being included in the Third Schedule to the Central Excise Act, 1944.

2)        Goods, such as lemonade and other beverages, are being notified under section 4A of the Central Excise Act for the purpose of assessment of Central Excise duty with reference to the Retail Sale Price with an abatement of 35%. Such goods are also being included in the Third Schedule to the Central Excise Act, 1944.

III.      Compliance Facilitation:

1)        Online Central Excise/Service Tax Registration within two working days.

2)        Time limit for taking CENVAT Credit on inputs and input services is being increased from six months to one year.

3)        Facility of direct dispatch of goods by registered, dealer from seller to customer’s premises is being provided. Similar facility is also being allowed in respect of job-workers. Registered importer can also send goods directly to customer from the port of importation.

4)        Penalty provisions in Customs, Central Excise & Service Tax are being rationalized to encourage compliance and early dispute resolution.

5)        Central Excise/Service Tax assessees are being allowed to issue digitally signed invoices and maintain other records electronically.

  1. Miscellaneous:

1)        The entry “waters, including mineral waters and aerated waters, containing added sugar or other sweetening matter or flavoured” in the Seventh Schedule to the Finance Act, 2005 related to levy of additional duty of excise @ 5% is being omitted. Till the enactment of the Finance Bill, 2015, the said additional duty of excise of 5% leviable on such goods is being exempted. Simultaneously, the Basic Excise Duty on these goods is being increased from 12% to 18%.

2)        Excise duty on chassis for ambulances is being reduced from 24% to 12.5%.

  1. Improving the quality of life and public health through Swachh Bharat Initiatives.

CUSTOMS & EXCISE

1)        The Scheduled rate of Clean Energy Cess levied on coal, lignite and peat is being increased from `100 per tonne to `300 per tonne. The effective rate of Clean Energy Cess is being increased from `100 per tonne to `200 per tonne.

2)        Concessional customs and excise duty rates on specified parts of Electrically Operated Vehicles and Hybrid Vehicles, presently available upto 31.03.2015, is being extended upto 31.03.2016.

3)        Excise duty on sacks and bags of polymers of ethylene other than for industrial use is being increased from 12% to 15%.

SERVICE TAX

1)        An enabling provision is being made to empower the Central Government to impose a Swachh Bharat Cess on all or certain taxable services at a rate of 2% on the value of such taxable services. The proceeds from this Cess would be utilized for Swachh Bharat initiatives. This Cess will be effective from a date to be notified.

2)        Service provided by a Common Effluent Treatment Plant operator for treatment of effluent is being exempted.

  1. Stand alone proposals to maximise benefits to the economy

D.I      Broadening the Tax Base:

EXCISE

1)        Excise duty of 2% without CENVAT credit or 6% with CENVAT credit is being levied on condensed milk put up in unit containers. It is also being notified under section 4A of the Central Excise Act for the purpose of valuation with reference to the Retail Sale Price with an abatement of 30%.

2)        Excise duty of 2% without CENVAT credit or 6% with CENVAT credit is being levied on peanut butter.

SERVICE TAX

  1. Change in Service Tax rates:

1)        The service tax rate is being increased from 12% plus Education Cesses to 14%. The ‘Education Cess’ and ‘Secondary and Higher Education Cess’ shall be subsumed in the new service tax rate. The revised rate shall come into effect from a date to be notified.

  1. Review of the Negative List

1)        Service tax to be levied on the service provided by way of access to amusement facility such as rides, bowling alleys, amusement arcades, water parks, theme parks, etc.

2)        Service tax to be levied on service by way of admission to entertainment event of concerts, non-recognized sporting events, pageants, music concerts and award functions, if the amount charged for admission is more than Rs 500. Service by way of admission to exhibition of the cinematographic film, circus, dance, or theatrical performances including drama, ballets or recognized sporting events shall continue to be exempt.

3)        Service tax to be levied on service by way of carrying out any processes as job work for production or manufacture of alcoholic liquor for human consumption.

4)        An enabling provision is being made to exclude all services provided by the Government or local authority to a business entity from the Negative List. Once this amendment is given effect to, all service provided by the Government to business entities, unless specifically exempt, shall become taxable.

III.      Review of General Exemptions

1)        Exemption presently available on specified services of construction, repair of civil structures, etc. when provided to Government shall be restricted only to,-

  1. a) a historical monument, archaeological site
  2. b) canal, dam or other irrigation work;
  3. c) pipeline, conduit or plant for (i) water supply (ii) water treatment, or (iii) sewerage treatment or disposal.

2)        Exemption to construction, erection, commissioning or installation of original works pertaining to an airport or port is being withdrawn.

3)        Exemption to services provided by a performing artist in folk or classical art form of (i) music, or (ii) dance, or (iii) theater, will be limited only to such cases where amount charged is upto Rs 1,00,000 per performance (except brand ambassador).

4)        Exemption to transportation of ‘food stuff’ by rail, or vessels or road will be limited to transportation of food grains including rice and pulses, flours, milk and salt only. Transportation of agricultural produce is separately exempt which would continue.

5)        Exemptions are being withdrawn on the following services:

(a)         services provided by a mutual fund agent to a mutual  fund or assets management company;

(b)        distributor to a mutual fund or AMC; and

(c)         selling or marketing agent of lottery ticket to a   distributor of lottery.

6)        Exemption is being withdrawn on the following services,-

(a)         Departmentally run public telephone

(b)         Guaranteed public telephone operating only local calls

(c)         Service by way of making telephone calls from free telephone at airport and hospital where no bill is issued

7)        Existing exemption notification for service provided by a commission agent located outside India to an exporter located in India is being rescinded, as this notification has become redundant in view of the amendments made in law in the previous budget, whereby services provided by such agents have been excluded from the tax net.

D.II     Relief Measures:

CUSTOMS

1)        Exempt artificial heart (left ventricular assist device) from Basic Customs Duty of 5% and CVD.

EXCISE

1)        Full exemption from excise duty is being extended to captively consumed intermediate compound coming into existence during the manufacture of Agarbattis. Agarbattis attract Nil excise duty.

SERVICE TAX

1)        Services of pre-conditioning, pre-cooling, ripening, waxing, retail packing, labeling of fruits and vegetables are being exempted.

2)        Life insurance service provided by way of Varishtha Pension Bima Yojna is being exempted.

3)        Service provided by way of exhibition of movie by the exhibitor/theatre owner to the distributor or association of persons consisting of exhibitor as one of it’s member is being exempted.

4)        All ambulance services provided to patients are being exempted.

5)        Service provided by way of admission to a museum, zoo, national park, wild life sanctuary and a tiger reserve is being exempted.

6)        Transport of goods for export by road from the factory to a land customs station (LCS) is being exempted.

D.III   Allocation of additional resources for infrastructure:

EXCISE & CUSTOMS

1)        The Scheduled rates of Additional Duty of Customs / Excise levied on Petrol and High Speed Diesel Oil [commonly known as Road Cess] are being increased from `2 per litre to `8 per litre. The effective rates of Additional Duty of Customs / Excise levied on Petrol and High Speed Diesel Oil [commonly known as Road Cess] are being increased from `2 per litre to `6 per litre. Simultaneously, Basic Excise Duty Rates on Petrol and High Speed Diesel Oil (both branded and unbranded) are being reduced by `4 per litre. Basic Excise duty rates on petrol and diesel are also being increased suitably so as to subsume Education Cess and Secondary and Higher Education Cess presently levied on them. Thus, the net decrease in Basic Excise Duty on branded petrol is `3.46 per litre, on unbranded petrol is `3.49 per litre, on branded diesel is `3.63 per litre and on unbranded diesel is `3.70 per litre. However, total incidence of excise duties on petrol and diesel remains unchanged.

D.IV   Promote public health:

EXCISE

1)        Excise duty on cigarettes is being increased by 25% for cigarettes of length not exceeding 65 mm and by 15% for cigarettes of other lengths. Similar increases are proposed on cigars, cheroots and cigarillos.

2)        Maximum speed of packing machine is being specified as a factor relevant to production for determining excise duty payable under the Compounded Levy Scheme presently applicable to pan masala, gutkha and chewing tobacco. Accordingly, deemed production and duty payable per machine per month are being notified with reference to the speed range in which the maximum speed of a packing machine falls.

D.V     Other measures relating to Service Tax

  1. Changes in the Finance Act, 1994
  2. A definition of the term “government” is being incorporated in the Act to resolve interpretational issues as regards the scope of this term in the context of the Negative List and service tax exemptions.
  3. To amend the definition of term “service” to specifically state the intention of legislature to levy service tax on:
  4. chit fund foremen by way of conducting a chit; and
  5. distributor or selling agent of lottery, as appointed or authorized by the organizing state for promoting, marketing, distributing, selling, or assisting the state in any other way for organizing and conducting a lottery.
  6. It is being specifically prescribed in the Act that value of a taxable service shall include any reimbursable cost or expenditure incurred and charged by the service provider to make legal position clear and avoid disputes.
  7. Section 66F of the Act prescribes that unless otherwise specified, reference to a service shall not include reference to any input service used for providing such service. An illustration is being incorporated in this section to exemplify the scope of this provision.
  8. Rationalization of abatement
  9. A uniform abatement is being prescribed for transport by rail, road and vessel to bring parity in these sectors. Service Tax shall be payable on 30% of the value of such service subject to a uniform condition of non-availment of Cenvat Credit on inputs, capital goods and input services. Presently, tax is payable on 30% of the value in case of rail transport, 25% in case of road transport and 40% in case of transport by vessels.
  10. The abatement for executive (business/first class) air travel, wherein the service element is higher, is being reduced from 60% to 40%. Consequently, service tax would be payable on 60% of the value of fare for business class.
  11. Abatement is being withdrawn on chit fund service.
  12. Service Tax Rules
  13. In respect of any service provided under aggregator model, the aggregator is being made liable to pay service tax if the service is provided using the brand name of aggregator in any manner.
  14. Consequent to the upward revision in Service Tax rate, the composition rate on specified services, namely, life insurance service, services of air travel agent, money changing service provided by banks or authorized dealers, and service provided by lottery distributor and selling agent, is proposed to be revised proportionately.
  15. Reverse charge mechanism
  16. Manpower supply and security services when provided by individual, HUF, partnership firm to a body corporate are being brought to full reverse charge as a simplification measure. Presently, these are taxed under partial reverse charge mechanism.
  17. Services provided by mutual fund agents, mutual fund distributors and lottery agents are being brought to under reverse charge consequent to withdrawal of exemption on such services.
  18. The Cenvat Credit Rules, 2004

Cenvat Credit Rules are being amended to allow credit of service tax paid under partial reverse charge by the service receiver without linking it to the payments of value of service to service provider as a trade facilitation measure.

BUDGET 2015

Here are sector-wise highlights

Taxation

1 Abolition of Wealth Tax.
2 Additional 2% surcharge for the super rich with income of over Rs. 1 crore.
3 Rate of corporate tax to be reduced to 25% over next four years.
4 Total exemption of up to Rs. 4,44,200 can be achieved.
5 100% exemption for contribution to Swachch Bharat, apart from CSR.
6 Service tax increased to14 per cent.

Infrastructure

1 Rs. 70,000 crores to Infrastructure sector.
2 Tax-free bonds for projects in rail road and irrigation
3 PPP model for infrastructure development to be revitalised and govt. to bear majority of the risk.
4 Atal Innovation Mission to be established to draw on expertise of entrepreneurs, and researchers to foster scientific innovations; allocation of Rs. 150 crore.
5 Govt. proposes to set up 5 ultra mega power projects, each of 4000MW.

Education

1 AIIMS in Jammu and Kashmir, Punjab, Tamil Nadu, Himachal Pradesh, Bihar and Assam.
2 IIT in Karnataka; Indian Institute of Mines in Dhanbad to be upgraded to IIT.
3 PG institute of Horticulture in Armtisar.
4 Kerala to have University of Disability Studies
5 Centre of film production, animation and gaming to come up in Arunachal Pradesh.
6 IIM for Jammu and Kashmir and Andhra Pradesh.

Welfare schemes

1 GST and JAM trinity (Jan Dhan Yojana, Aadhaar and Mobile) to improve quality of life and to pass benefits to common man.
2 Six crore toilets across the country under the Swachh Bharat Abhiyan.
3 MUDRA bank will refinance micro finance orgs. to encourage first generation SC/ST entrepreneurs.
4 Housing for all by 2020.
5 Upgradation 80,000 secondary schools.
6 DBT will be further be expanded from 1 crore to 10.3 crore.
7 For the Atal Pension Yojana, govt. will contribute 50% of the premium limited to Rs. 1000 a year.
8 New scheme for physical aids and assisted living devices for people aged over 80 .
9 Govt to use Rs. 9,000 crore unclaimed funds in PPF/EPF for Senior Citizens Fund.
10 Rs. 5,000 crore additional allocation for MGNREGA.
11 Govt. to create universal social security system for all Indians.

Agriculture

Rs. 25,000 c
Rural Infrastructure Development Bank
Rs. 5,300 cr
Micro Irrigation Programme
Rs. 8.5 lakh cr
Targeted for farmer credit

Defence

Rs. 2,46,726 cr
allocated for defence
(an increase of 9.87 per cent over last year)
Focus on Make in India for quick manufacturing of Defence equipment.

Renewable energy

Rs. 75 cr
electric cars production
2022: 100K MW
Solar power
60K MW
Wind power
10K MW
Bio Mass
5K MW
Small Hydro

Tourism

Develpoment schemes for churches and convents in old Goa; Hampi, Elephanta caves, Forests of Rajasthan, Leh palace, Varanasi , Jallianwala Bagh, Qutb Shahi tombs at Hyderabad to be under the new toursim scheme.
Visa on Arrival for 150 countries

12.28 p.m.: Rs. 50,000 contribution to new pension scheme. “To make India a pensioned society.”

12.27 p.m.: Additional deduction of Rs. 25,000 for differently abled persons.

12.26 p.m.: Increase in limit of deduction of health insurance premium of Rs. 15,000 to Rs. 25,000. For senior citizens, limit will be Rs. 30,000. Very senior citizens – Rs. 30,000 deduction on expenses incurred.

12.25 p.m.: 2 per cent cess on services for Swachch Bharat.

12.24 p.m.: 100 per cent deduction for contribution to Swachch Bharat and Clean Ganga schemes.

12.23 p.m.: Service Tax rate increased to 14 per cent.

12.22 p.m.: Educational cess and higher educational cess to be subsumed as a part of GST.

12.19 p.m.: Wealth tax – Rs. 1,008 crore in 2013-14. Wealth tax to be abolished and replaced with a super-rich tax for those with income of over Rs. 1 crore.

12.17 p.m.: Basic custom duty rate reduced for 22 items.

12.16 p.m.: GAAR – applicability to be deferred by two years.

12.15 p.m.: Allocation for renewable energy

12.10 p.m.: Allocation for agriculture

12.08 p.m.: First proposal is to deal with black money. In the last 9 months, a major breakthrough was achieved when a delegation of the Revenue Department visited Switzerland.

12.07 p.m.: Exemption to individual taxpayers will continue.

12.04 p.m.: Taxation

Basic rate of corporate tax in India is now 30 per cent. But rate of collection is 23 per cent. A regime of exemptions has led to loss of revenue.

Coporate tax rate wil be reduced to 25 per cent over the next four years.

12.02 p.m.: Budget estimates

Non-plan expenditure – Rs. 13,12,200 crore

Plan expenditure – Rs. 4,65,277 crore

Fiscal deficit – 3.9% of GDP

12.01 p.m.: Make in India policy for defence equipment – Rs. 2,46,727 crore allocation for defence.

12.00 noon: Rs. 68,968 crore for education sector.

11.57 a.m.: We are making good progress on Digital India.

11.55 a.m.: AIIMS in Jammu and Kashmir, Punjab, Tamil Nadu, Assam. AIIMS-like institution in Bihar. IIT in Karnataka. IIMs in Jammu and Kashmir, and Andhra Pradesh. Centre for Film Production and Animation in Arunachal Pradesh.

11.54 a.m.: Fully IT based student financial aid scheme for higher education.

11.53 a.m.: National Skills Mission for skill development and entrepreneurship – Rs. 1,500 crore.

11.52 a.m.: Procurement law for public contracts. Govt. to introduce Public Contracts (Resolution of Disputes) Bill. Regulatory reform law to be introduced.

11.51 a.m.: Rs. 75 crore for electric cars production.

11.50 a.m.: Visa on arrival scheme – increased to 150 countries in different stages.

11.49 a.m.: World Heritage Sites – churches and convents of old Goa, Hampi, Elephanta caves, Leh palace, Varanasi temple town, Jallianwala Bagh etc., will be developed to make them more tourist-friendly.

11.48 a.m.: Rs. 1,000 crore additional allocation to the Nirbhaya fund.

11.47 a.m.: Will do away with different types of foreign investment — like FPI and FDI — and replace them with a comprehensive type.

11.46 a.m.: We will look at making India a cashless society by incentivising card transactions.

11.44 a.m.: EPF – Employee may opt for EPF or new pension scheme, employee’s contribution to EPF below an income threshold will be optional without reducing employer’s contribution.

11.43 a.m.: Direct Tax regime which will be internationally competitive on rates.

11.41 a.m.: Will merge Forward Markets Commision with SEBI. Will set up a public debt management agency.

11.40 a.m.: Rs. 5,000 crore additional allocation for MGNREGA.

11.37 a.m.: Ports will be encouraged to corporatise and become companies under Companies Act.

11.35 a.m.: The govt. is establishing a mechanism for techno-financial incubation and facilitation programme – Rs. 1,000 crore set aside for this.

11.33 a.m.: Investment in Infrastructure will go up by Rs 70,000 crore in 2015-16. Annual inflow of Rs. 20,000 crore by way of a trust, to use this extra equity to leverage investment in infrastructure. PPP model to be revisited and revitalised. Atal Innovation Mission – for entrepreneurs and researchers to foster a culture of innovation: R.s 150 crore for this purpose.

11.32 a.m.: Nayi Manzil scheme – to enable minority youth to obtain school leaving certificate and gain better employment.

11.31 a.m.: Assisted living devices for senior citizens living below the poverty line.

11.30 a.m.: Pradhan Mantri Jeevan Jyoti Bima Yojana – Rs. 1 per day premium, Rs. 2 lakh coverage.

11.28 a.m.: Accident death risk – Rs 2 lakhs for a premium of Rs. 12 per year. Atal Pension Yojana – defined pension depending on contribution. Govt. will contribute 50 per cent of the amount.

11.27 a.m.: NBFCs registered with RBI above Rs. 5,000 crore to be considered financial institutions.

11.26 a.m.: We will bring a comprehensive bankruptcy code in 2015-16.

11.26 a.m.: Will create Mudra Bank with corpus of Rs. 20,000 crore for microfinance. “We are banking the unbanked and funding the unfunded.”

11.25 a.m.: MGNREGA – Rs. 34,699 crore

11.23 a.m.: Rs. 8.5 lakh crore of rural credit for the year.

11.21 a.m.: In order to improve soil health, the Agriculture Ministry’s organic farming programme, Rs. 5,300 crore for micro-irrigation watershed projects.

11.20 a.m.: Gross disinvestment in loss-making units will be undertaken. DBT will be further expanded from 1 crore to 10.3 crore.

11.17 a.m.: Total public investment will be Rs 1.25 lakh crore. “Will complete the journey to fiscal deficit of 3 per cent in two years and not three years.”

11.16 a.m.: Government will continue all social sector programmes like MNREGA, rural schemes etc.

11.14 a.m.: “We have devolved a 42 per cent share of divisible taxes to States. Devolution will be Rs. 5.2 lakh crore in 2015. Total transfer to States will 62 per cent.”

11.13 a.m.: “The rural-urban divide is no longer acceptable.”

11.12 a.m.: “All our schemes should focus off-centre on the poor. We need to upgrade 80,000 secondary schools.”

11.11 a.m.: Housing for all by 2022 announced — 2 crore in rural areas, 5 crore in urban areas.

11.10 a.m.: Estimated GDP for 2015-16 will be between 8 and 8.5 per cent. “Aiming for a double-digit growth rate seems feasible.”

11.08 a.m.: We have embraked on two other programmes now — GST and JAM Trinity. GST will be implemented by April 2016 says Mr. Jaitley.

11.07 a.m.: Mr. Jaitley puts forth three achievements of the new government — the success of the Jan Dhan Yojana, coal auctions and Swachch Bharat Abhiyan. “We will attain the target of building 6 crore toilets. It’s at a deeper level a programme of preventive healthcare.”

11.05 a.m.: “The people of India have voted resoundingly for quick change, faster growth and high levels of transparency. We have lived up to that trust.”

11.04 a.m.: “We inherited a sentiment of doom and gloom. We have come a long way since then. The CAD for the year is expected to be below 1.3% of GDP. Foreign exchange reserves have risen to $340 billion.”

11.02 a.m.: “The credibility of the Indian economy has been reestablished,” says Mr. Jaitley. “We are a round-the-clock, round-the-year government.”

11 a.m.: Arun Jaitley begins his Budget speech. “We have embraced the States as equal partners in the process of economic growth.”

10.50 a.m.: Budget documents arrive at the Parliament. Photo: Sandeep Saxena

10.45 a.m.: The Swachch Bharat Abhiyan has a target of building 120 million toilets over five years with an investment of Rs. 2 lakh crore. But the FY ’15 target of 12 million targets seems set to be missed.

10.34 a.m.: Which are India’s most effective subsidies, the ones that best reach the poor?

 

$80 billion wearables market?

$80 billion wearables market?

Connected gadgets that are indistinguishable from their disconnected peers will fuel the growth of wearable technology.

Wearable technology is redefining what it means to be disabled

Several factors have dogged the nascent wearable technology market. The lack of breakthrough innovation around batteries, for one, requiring wearers to plug in on-the-go gadgets more than they’d like. The lack of sophistication around tiny user interfaces is another, though that will no doubt improve over time.

But a big one? The social factor. Beyond the geeks of Silicon Valley and elsewhere, it’s just not cool to wear a watch, glasses, or headset that’s as big as a hood ornament.

That’s going to change, according to Juniper Research. The British market observer believes that the wearable technology market will grow to $80 billion by 2020—and the key will be making the connected gadgets virtually indistinguishable from their disconnected peers.

That means that Apple AAPL 0.05% must be on to something as it continues to make atypical hires from the fashion and apparel world. Observers, including Fortune‘s own Philip Elmer-Dewitt, believe the new talent will help smooth the rough edges of a technology that’s as personal as a bracelet, watch, or ring. (So, apparently, does Google.) The best wearables, and the ones best positioned for profitability, may be those that allow their technology to completely recede into the background.

Nevertheless, wearables will be a diverse growth market that’s not merely Internet-connected jewelry. Wearables that attach to the skin, such as MC10’s Biostamp, are also part of this category—though they’re in a “more embryonic state” and require a much larger shift in consumer habits than a smart watch, Juniper says.

Many technology companies—including Apple, ARM, Google, Intel, Lenovo-Motorola, LG, MC10, Microsoft, Omate, Qualcomm, Sony, and Withings, plus wearables-savvy design firms like Gadi Amit’s NewDealDesign and Yves Béhar’s Fuseproject—are well-positioned to benefit from the boom. With the right features, consumers are, too.

The meaning of “disabled” is changing as people adopt wearable devices and move into a bionic future.

The visually impaired have used canes to navigate for most of recorded history, but the white version we’re familiar with was born in early 20th century Paris. Guilly d’Herbemont lived above a street frequented by blind pedestrians, regularly witnessing their peril in an era when automobiles were common but crosswalks a novelty. By 1931, she had come up with the idea of establishing a bold white cane as a protective symbol and navigational tool for the blind, and distributed more than 5,000 of them at her own expense. The idea had spread internationally within two years.

Tech developer Krispian Lawrence hopes to build on d’Herbemont’s legacy. Lawrence lives in India, which he says has “the unfortunate distinction of being the blind capital of the world,” and he sees both the strengths and drawbacks of the white cane. “The cane has social significance. At the same time, it has two major defects: it can’t [guide] you from one place to another, and it can’t orient you.” Lawrence is CEO of Lechal (Hindi for “Take me there”), which he co-founded with Anirudh Sharma in 2011. The company is about to release its first products: footwear that will supplement the white cane by providing navigation and safety information through vibrations in the wearer’s feet.

Since starting the company, Lawrence and his team have discovered that their product appeals to a variety of people. When the Lechal shoes and insoles become available later this year (for about $150), they will include features that will help runners monitor their pace, outdoorsmen map new trails, and tourists navigate unknown cities, all without burying their faces in a smartphone. This broader spectrum of users benefit from the haptic interface and motion commands that make Lechal intuitive for the blind.

Lechal is just one example of how wearable tech is eroding the boundaries between assistive technology and the consumer technology market. As interfaces get more creative and sensors get more powerful, people with all types of bodies will be drawn to technology that enhances senses, monitors health, and eases interactions with the environment. As they become more and more a part of everyday life, these devices may shift our views on bodies and their limitations.

The developers at Soundhawk have planted their flag on that blurring line. Soundhawk is an in-ear device to enhance hearing—but don’t call it a hearing aid. The company’s founders and executives include audiologists who have seen plenty of patients experience difficulty hearing in certain situations even though they display no measurable sign of hearing loss. Soundhawk is based on the same technology built into high-end hearing aids, but it’s targeted at this technically unimpaired group.

“We’re taking a product away from the idea of being a hearing assistive device for people who have a problem,” says Drew Dundas, the company’s chief science officer, “to being a performance enhancement for people to improve their quality of life.” To target these users, Soundhawk is trying to distance itself from the stigma of hearing aids as signs of aging and infirmity. In part, they’re doing this by marketing the device directly to consumers, rather than through doctors.

Soundhawk has also bucked the trend toward invisibility in hearing aids, instead releasing a device that resembles a hands-free headset—a design less likely to mark the user as impaired than even the most discreet in-ear hearing aid. Similarly, while Lechal offers invisible insoles, its shoe product is flashy, a bet that today’s users are unembarrassed about showing off their enhancements.

The assistive benefits of wearables aren’t limited to those with mobility and perceptual deficits. Jesse Slade Shantz, chief medical officer of the “smart” apparel companyOMsignal, cites the power of biometric tracking for lung and heart disease patients, diabetics, and sleep apnea sufferers. As the sophisticated sensors once available only in clinics and labs find their way into shirts and watches, chronic disease patients will be able to optimize their behavior in real time, in ways very similar to how early-adopting fitness buffs already use wearables.

As wearable technology advances and spreads, information technology is becoming even more ubiquitous, with complex implications for those who use assistive devices. According to a report by Transparency Market Research, the assistive devices market is estimated to grow to $19.68 billion by 2019. But that measure only includes devices defined as assistive in the traditional way. Lechal, Soundhawk, OMsignal, and other consumer wearables that are useful for the disabled and able-bodied alike might constitute a new category.

They may also change how society as a whole understands disability. Will Seymour of the Future Foundation consulting group points out that wearable and mobile tech is already giving the disabled newfound freedom to communicate and navigate. “Allowing someone to do more with their body is certainly a redefinition of what it means to have a disability,” he says. “Performance boundaries are now seen as flexible; the body’s weaknesses as negotiable.”

Indian Pharma Industry Needs a Big Investment Reforms & Push from Transformational Union Budget 2015-16 ” – Dr. Rajendra Kamat , VC & MD, Dr. Datsons Labs Ltd.

Indian Pharma Industry Needs a Big Investment Reforms & Push from Transformational Union Budget 2015-16 ” – Dr. Rajendra Kamat , VC & MD, Dr. Datsons Labs Ltd.

Dr. Rajendra Kamat , VC & MD, Dr. Datsons Labs Ltd. expressed hope that the Finance Minister Arun Jaitley will  accord enhanced tax incentives for research and development (R&D) activities in the pharmaceutical sector in the forthcoming Budget to be announced on February 28. In its Budget proposals, the Commerce Ministry has sought “weighted average tax benefit of 400 per cent for R&D activities for the sector”.

Midsized companies like us will look at more positive agenda & push from the forthcoming budget & clarity of direction on tax reforms & FDI.

“There is an urgent need to boost R&D in the pharma sector. India is the hub of generic medicines. It contributes significantly to the country’s total exports,” Dr. Kamat expressed that the industry will get fresh incentives as annually, India exports pharmaceutical products worth $10 billion. The market size of the industry is around Rs. 1 lakh crore.The need for special financial package for the pharma sector has been highlighted in various fora.The pharma sector is a capital intensive sector. Besides R&D expenditure, regulatory requirements require large funds. All quality investments should be treated on par with R&D to provide incentives to the industry,” the official added.

Dr. Datsons Lab Ltd, formerly known as Aanjaneya Lifecare Ltd, BSE code (533412) is a vertically integrated company having state-of-the-art; WHO GMP approved facilities for manufacturing bulk drugs at Mahad and finished dosage forms at Pirungut near Pune. It is one of the largest contract manufacturers of codeine based cough syrups in India. The company exclusively manufactures the Codorex Brand of Zydus Cadilla and Codilite Brand of Tablets India Ltd. amongst others.The company raised about Rs. 117 crore from its IPO and the funds are being used to built new capacities along with the refurbishing of Research & Development centre. The new facilities being created as part of CAPEX are using eco friendly, recyclable material and will be rated by LEEDS once completed.The Facilities being established will comply with the latest European & US guidelines. With new capacities to be added in next 6 to 9 months the company will be expanding operations in emerging markets of South East Asia, Africa & South & Central America and its domestic operation in branded generics segment. The company with its manufacturing facilities –in Mahad, Hyderabad and Pune has to its credit many achievements. It is the world’s third-largest manufacturer of quinine salts in the world . Only nine companies globally manufacture quinine salts.One of the largest codeine based formlulations manufacturer in the pharmaceutical sector. One of the largest manufacturer of multi- flavored Lozenges in  medical products in India. The company pioneered the recognition that lozenges represent a stable platform for the delivery of pharmaceutical and nutraceutical ingredients. Dr. Datson’s Nicco Nil lozenge is a first-of-its-kind  hard boiled lozenge remedy for smoking de-addition; its Relacs is a first-time lozenge against insomnia and Arecta Plus, a lozenge variant for Erectile Dysfunction, is a first of its kind . The company has an expertise in opportunity spotting and innovation. The company’s success has been built on a business model that integrates Research, Innovation and Knowledge. The company has invested in building proprietary Knowledge through research and acquisitions. Dr. Datson’s competence has been validated through patents granted by international and Indian authorities. Production of Quinine Sulphate increased 30% in 2011-2012. Sales of Quinine Sulphate grew 45%. Exports increased 250% from Rs 10 Crore to Rs 31 crore. Added 35 international and 50 domestic clients. Completed trials for Bromexine(expectorant)a new API that will be launched in 2012-1023. Highlights 2011-2012 for Finished Dosage Forms. Launched ‘Rancorex’ an in-house codine based cough syrup brand for the first time in its history. received the Kenya PPB GMP approval from all facilities namely lozenges,liquids and ointments. Received registration for ‘Arecta Plus’(a lozenge variant of Viagra tablets)from Sierrs Leone and Libya; received the first export order for this product to be executed in 2012-2013.

HSBC’s Swiss private banking Secrets, 200 Countries, Over $100 million Accounts including Mukesh and Anil Ambani, Yashovardhan Birla, Chandru Lachhmandas Raheja and Dattaraj Salgaocar among others

US government faces pressure after biggest leak in banking history. Questions for Department of Justice and IRS after disclosure of leak revealing HSBC’s private Swiss bank helped clients to conceal undeclared ‘black’ accounts  HSBC bank branch 

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In 2010, amid growing scrutiny from US tax authorities, HSBC’s private bank in Switzerland stopped doing business with US residents entirely. Photograph: Mike Segar/Guardian
Paul Lewis in New York

The US government will come under intense pressure this week to explain what action it took after receiving a massive cache of leaked data that revealed how the Swiss banking arm of HSBC, the world’s second-largest bank, helped wealthy customers conceal billions of dollars of assets.

The leaked files, which reveal how HSBC advised some clients on how to circumvent domestic tax authorities, were obtained through an international collaboration of news outlets, including the Guardian, the French daily Le Monde, CBS 60 Minutes and the Washington-based International Consortium of Investigative Journalists.

The files reveal how HSBC’s Swiss private bank colluded with some clients to conceal undeclared “black” accounts from domestic tax authorities across the world and provided services to international criminals and other high-risk individuals.

The disclosure amounts to one of the biggest banking leaks in history shedding light on some 30,000 accounts holding almost $120bn (£78bn) of assets. Of those, around 2,900 clients were connected to the US, providing the IRS with a trail of evidence of potential American taxpayers who may have been hiding assets in Geneva.

A trail of evidence
The data was leaked by a computer expert turned whistleblower working in HSBC’s Geneva office. French authorities later obtained the files and shared them with the US Internal Revenue Service in 2010. That year, amid growing scrutiny from US tax authorities, HSBC’s private bank in Switzerland stopped doing business with US residents entirely.

HSBC files: why the public should know of Swiss bank’s pattern of misconduct
Scores of clients of lucrative operation are already under criminal investigation amid claims of their involvement in drug smuggling, frauds and terror financing
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The US Department of Justice and IRS have been investigating HSBC’s Swiss banking operations ever since but the scale of those inquiries remain unclear.

Confronted by the Guardian’s evidence, HSBC admitted wrongdoing by its Geneva-based subsidiary. “We acknowledge and are accountable for past compliance and control failures,” the bank said in a statement. The Swiss arm, the statement said, had not been fully integrated into HSBC after its purchase in 1999, allowing “significantly lower” standards of compliance and due diligence to persist.

HSBC added: “Beginning in 2008 HSBC began to put a more rigorous control structure in place in the Swiss private bank by, for example, introducing a new policy on US persons and reducing the number of US taxpayer accounts. In 2010, the Swiss private bank decided to exit US resident client business entirely.”

However the Swiss files, made public for the first time by the Guardian and other media, are likely to raise questions in Washington over whether there is evidence to prosecute HSBC or its executives in the US. Lawmakers are also expected to question the rigour of IRS investigations into undeclared assets hidden by US taxpayers in Geneva.

The IRS said it “remains committed to our priority efforts to stop offshore tax evasion wherever it occurs”, and pointed out it has collected more than $7bn from a program, introduced in 2009, that allows US taxpayers to voluntarily disclose previously undeclared offshore accounts.

However the IRS declined to say how much it has retrieved in back taxes, interest and penalties as a result of investigations stemming from the leaked HSBC Swiss data. The IRS also declined to say how many US taxpayers have been investigated as a result of the leak, citing taxpayer privacy and the Tax Information Exchange Agreement (TIEA), a treaty that renders secret information shared between the US and France. The DoJ said it “does not confirm or deny the existence of an investigation”.

Senior Senate sources said government officials are likely to be questioned on Capitol Hill over what action was taken after the US received the leaked HSBC data almost five years ago.

Intense scrutiny in DC
On Tuesday, Maryann Hunter, who is on the board of governors of the Federal Reserve, and has some responsibility for regulation of foreign banking organisations operating in the US, will give evidence to the Senate banking committee. Two days later, Geoffrey Graber, a deputy associate attorney general at the DoJ who oversees settlements with Wall Street banks, will appear before a House judiciary subcommittee. Both are expected to be questioned about the leak.

Public disclosure of the leaked files comes at a critical moment for HSBC in the US, where prosecutors have already warned the bank is operating under a “sword of Damocles”. HSBC global and its US bank was forced to pay a $1.9bn fine two years ago after the DoJ uncovered evidence HSBC subsidiaries had enabled clients to breach US sanctions against Cuba, Sudan and Iran and, due to oversight failures, allowed Mexican drug cartels launder billions of dollars.

That deal was unveiled in December 2012, six months after a damning investigation into HSBC global and its US affiliate by the Senate permanent subcommittee for investigations. The deferred prosecution agreement made no mention of evidence of tax evasion connected to HSBC’s Swiss banking division, even though the US government had received the leaked data two years earlier.

Catalogue of malpractice endorsed by bankers laid bare in HSBC files
Swiss operation actively abetted clients in keeping accounts secret from tax authorities, at its height hiding $120bn in assets
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The 2012 settlement was overseen by Loretta Lynch, who was then US Attorney for the Eastern District of New York. Lynch is currently Barack Obama’s current nominee for attorney general.

At the time, the HSBC settlement was heavily criticised by both Republicans and Democrats for allowing the bank to escape criminal indictments and keep the charter which enables it to operate in the US. Lynch and other senior DoJ officials defended the deal, pointing out it committed HSBC to a five-year plan to stamp out money laundering and other illicit practices, an ongoing process that is being overseen by an independent, court-appointed monitor.

Files pertaining to HSBC’s private bank in Switzerland were obtained by a Geneva-based computer technical analyst, Herve Falciani, between 2006 and 2007. The files were later seized by French authorities and have been quietly shared with governments around the world, some of which have mounted investigations into tax evasion.

The HSBC leak has sometimes been referred to as the “Lagarde List”, after the then French finance minister, Christine Largarde, who shared portions of the HSBC data with her counterpart in Greece. The Guardian has reviewed the list of US clients with accounts in HSBC’s private Swiss bank. They include prominent film directors, sports stars, hedge fund managers, retail magnates and major political donors. The HSBC files provide no indication as to the US clients who declared their assets to the IRS.

In a recent court filing, Michael Danilack, a deputy commissioner at the IRS in Washington, said he asked the French for details of US individuals with undisclosed accounts in HSBC’s Swiss bank in early 2010. The request was granted and he received a CD file containing data leaked from HSBC’s Swiss bank “on or about April 6, 2010”, he said.

Prosecuting cases in US
There is evidence in that at least some US clients of HSBC’s private Swiss bank have been prosecuted. HSBC was found to have handed over “bricks” of $100,000 a time to US surgeon Andrew Silva in Geneva, so that he could illegally mail cash back to America. He mailed the sum to an address of his home state in Virginia in sums of less than $10,000, to avoid declaring the packages to US customs. He pleaded guilty to criminal tax evasion in 2010.

Another US client, Sanjay Sethi, pleaded guilty in 2013 to cheating the US tax authorities by maintaining $4.7m in accounts in Switzerland and India. The prosecution in his case said a high-ranking HSBC executive based in London promised on Swiss undeclared account would allow his assets “to grow tax-free and bank secrecy laws in Switzerland would allow Sethi to conceal the existence of the account”.

Last year, there were additional US court cases, in New York and Virginia, to enforce IRS summons for records of undeclared HSBC Swiss accounts held by two US taxpayers.

It is not known how many other investigations have been brought against US taxpayers over undeclared assets in HSBC’s Swiss bank, or whether the DoJ is considering prosecuting the bank or its executives. Almost five years after the data leaked by Falciani was passed onto US authorities, the investigations into HSBC’s private Swiss bank appear to be ongoing.

Obama will propose mandatory tax on US companies’ earnings held overseas
HSBC’s most recent annual report, published last year, said the bank was under investigation in the US by the DoJ and IRS “regarding whether certain HSBC companies and employees acted appropriately in relation to certain customers who had US tax reporting requirement”. It added: “In connection with these investigations, HSBC Private Bank Suisse SA, with due regard for Swiss law, has produced records and other documents to the DoJ and is cooperating with the investigation.”

HSBC also said in the report that the DoJ had requested additional information from HSBC’s Swiss bank “regarding the transfer of assets to and from US person related accounts and employees who serviced those accounts”. The report disclosed the fact that the DoJ informed HSBC’s Swiss bank, in August 2013, that it was not be eligible for the non-prosecution agreements made available to other Geneva-based banks.

It also warned HSBC shareholders there was a “high degree of uncertainty” over the ongoing US investigations and it was possible the bank could be forced to pay “significant” fines and penalties.

The DoJ was under pressure to go beyond financial penalties – to bring criminal charges against HSBC or its bankers – in July 2012, after the Senate’s permanent subcommittee on investigations published its crushing 330-page report documenting how the bank’s lax anti-money laundering controls had been exploited by drug traffickers.

HSBC’s head of compliance, David Bagley, resigned before the committee during a gruelling cross-examination from senators. Six months later, in December 2012, HSBC negotiated the settlement with the DoJ in which it agreed to pay almost $2bn and commit to a five-year plan to stamp out illicit practices, overseen by the independent monitor.

The settlement proved controversial because it stopped short of criminally indicting the bank or its executives; lawmakers from both parties complained it revealed some Wall Street institutions were considered “too big to jail”.

HSBC deal ‘fundamentally wrong’
The Democratic senator from Massachusetts Elizabeth Warren famously labelled the HSBC deal “fundamentally wrong”. “HSBC paid a fine, but no individual went to trial, no individual was banned from banking and there was no hearing to consider shutting down HSBC’s actives in the US,” Warren said at a Senate committee hearing in 2013. “How many billions of dollars do you have to launder for drug lords and how many sanctions do you have to violate before someone will consider shutting down a financial institution like this?”

At the time of the HSBC settlement, Lanny Breuer, then the head of the DoJ’s criminal division, insisted the bank was not being let off the hook. “It’s the first time in history that a foreign institution is going to have a monitor,” Breuer said. “There’s a sword of Damocles right now over HSBC.” Lynch told a CBS news at the time that she expected HSBC to “literally turn their company inside out” as part of the agreement.

Lynch was pressed over the HSBC settlement by Democratic senator Richard Blumenthal last week, during a confirmation hearing by the judiciary committee. Obama’s candidate for attorney general did not comment on the specifics of the deal, but told senators she was committed to “aggressively” pursuing white collar crime. “No individual is ‘too big to jail’,” she said. “And no one is above the law.”

HSBC is now just over two years into its reform plan, and has been deemed to be complying with the terms of the settlement. However the court-appointed monitor, Michael Cherkasky, who oversees a team of banking investigators who review HSBC’s changes, has expressed some concern over the pace of reform. Cherkasky’s most recent assessment of HSBC’s ongoing efforts to clean up its act has once again concluded it could do better, according a recent report in the Wall Street Journal which cited people familiar with its findings.

Meanwhile, HSBC remains entangled with US law enforcement and regulators on other fronts. In November, the bank reached with the the Securities and Exchange Commission in which HSBC agreed to pay $12.5m to resolve charges that its Swiss private banking division illegally provided investment and brokerage services to US clients.

The following month, the IRS issued a court summons to HSBC USA to “produce information about US taxpayers who may be evading or have evaded federal taxes” using a company called Sovereign Management & Legal Ltd, which trades via the website named ‘offshore-protection.com’. Prosecutors believe the US correspondent bank accounts that HSBC USA holds for Sovereign’s banks in Panama and Hong Kong are likely to have records of financial transactions by US clients who may have evaded taxes.

In May last year, the DoJ revealed it was prepared to bring criminal charges against banks suspected of involvement in tax evasion, when it forced Credit Suisse to plead guilty to a major conspiracy to aid US taxpayers filing false returns to the IRS. Under a plea agreement, Credit Suisse paid a total of $2.6bn.

“This case shows that no financial institution, no matter its size or global reach, is above the law,” the Attorney General Eric Holder said at the time. “Credit Suisse conspired to help US citizens hide assets in offshore accounts in order to evade paying taxes. When a bank engages in misconduct this brazen, it should expect that the Justice Department will pursue criminal prosecution to the fullest extent possible, as has happened here.”.

The Indian Link

The Indian Express on Monday published an investigation into bank accounts held by 1,195 Indians abroad. The investigation is based on leaks from the HSBC’s Swiss banking unit. The most significant names on the list, by far, are those of Mukesh Ambani and Anil Ambani.

India’s richest man does not top the list. He features at rank eight, below Sandeep Tandon, who used to be his Man Friday, managing Reliance’s taxation and liaison work.

Tandon was a former Indian Revenue Service official, the same service to which Arvind Kejriwal, the Aam Aadmi Party leader, belonged.

In November 2012, before the formation of AAP, when Kejriwal was still an activist of the Anna Hazare led India Against Corruption movement, he held a press conference where he revealed a list of ten names of Indian account holders of Swiss bank vaults.

Kejriwal expose

The Hindu reported, “In a daring expose, IAC members alleged that Mukesh and Anil Ambani and Congress MP Anu Tandon, among others, had crores of rupees sitting in Swiss banks.”

The choice of words ‒ “a daring expose” ‒ said it all.

In a scathing story in August 2014, describing Reliance as “a rotten role model for corporate India”, The Economist said, “When it comes to governance this secretive and politically powerful private empire is not a national champion but an embarrassment.”

These are words that you are unlikely to find in an Indian publication, which is why the Indian Express investigation is significant. Produced as part of a global collaboration, which saw 140 journalists worldwide go through the list of Swiss bank account holders obtained by the Paris-based newspaper Le Monde, the investigation ends the speculation swirling around Swiss bank accounts held by Indians, and puts down a credible list. On the list are the Ambani brothers among other corporates heads, businessmen, politicians, and at least two former IRS officers. Most earlier reports on the HSBC Swiss bank list have omitted the names of Ambanis.

The paper is careful to remind its readers that not all accounts hold black money. But given the secrecy over Swiss bank accounts, the paper thought it was worth making public the information and said that “undeclared wealth is an important part of political discourse, involving the government, the Supreme Court and the central bank”

The list owes its existence to Hervé Falciani, a systems engineer and former employee of the Geneva office of HSBC, who walked away in 2008 with 11 floppy discs containing data of around 130,000 bank customers. Not all on the list were people who had stashed away illicit money. Many were legitimate account holders who had paid taxes. But the French government took the list seriously enough to pass it on to other countries. Many countries including UK, France, Spain and others used the list to initiate investigations into possible tax evasion.

International project

In August 2011, the Indian Express reported that the Indian government had received the information and Pranab Mukherjee, then finance minister, now President of India, had asked for a probe into the accounts. “Names of several important Indian businessmen and corporates are said to be in the data received,” the report said.

Not a single name was published anywhere in India. But in January 2012, the Economic Times reported that HSBC had apologised to Mukesh Ambani “for embroiling him in an investigation by India’s income-tax authorities…the bank clarified that neither he, nor Reliance Industries, was the owner of any beneficiary account with the bank’s private banking division.”

But three years later, as Indian Express partnered in an international project to access the names and details of 1.688 bank account holders, which it laboriously checked and whittled down to 1,195 account holders, it found Mukesh Ambani’s name was indeed part of the leaked HSBC list of customers. In a response to the paper, a Reliance spokesperson still maintained, “Neither RIL nor Mr Mukesh Ambani have or had any illegitimate bank accounts anywhere in the world.”

Obama Ends Visit With Challenge to India on Climate Change

New Delhi:  President Obama pressed India on Tuesday to do more to curb the pollution that is choking its capital and contributing to global climate change, as he wrapped up a visit that yielded no meaningful breakthrough on the issue.

While India and the United States agreed to cooperate in promoting cleaner energy, Mr. Obama left after three days without the sort of specific commitment to curbing greenhouse gases that he won in China last year. Instead, he used a farewell speech before his departure to argue that India had an obligation to step up, despite its economic challenges.

“I know the argument made by some – that it’s unfair for countries like the United States to ask developing nations and emerging economies like India to reduce your dependence on the same fossil fuels that helped power our growth for more than a century,” Mr. Obama told an audience of 1,500 mostly young Indians at Siri Fort Auditorium on the final day of his trip here.

“But here’s the truth,” he added. “Even if countries like the United States curb our emissions, if countries that are growing rapidly like India with soaring energy needs don’t also embrace cleaner fuels, then we don’t stand a chance against climate change.”

The president’s remarks came during a speech with a broader tough-love message, lavishing praise on India and pledging friendship while challenging it to cut back on human rights abuses. He urged India to protect the rights of girls and women, combat human trafficking and slavery, promote religious and racial tolerance, and empower young people.

Diabetes, Thyroid & Hormone Clinic Founder Dr. Deepak Chaturvedi Awarded at prestigious 7th Annual Pharmaceutical Leadership Summit & Pharmaleaders Business Leadership Awards 2014 as “India’s Most Promising Obesity Consultant 2014

AMAAYA™ Antiaging & Wellness Clinic led by Obesity & Anti-Aging Consultant Dr. Deepak Chaturvedi also recognized as  “India’s Most Promising Anti- aging & Wellness Clinic 2014” for innovation in Medical Research & quality medical care

Noted Mumbai based Obesity & Anti-Aging Consultant & Expert in Management of Obesity, Andropause, Menopause, Sexual dysfunction, Aging and Other Hormonal Issues Dr. Deepak Chaturvedi was crowned as “India’s Most Promising Obesity Consultant 2014” at the Asia’s Biggest & Nation’s most awaited healthcare summit & Awards organized by healthcare communication leader Pharmaleaders ( www.pharmaleader.tv ) , the 7th Annual Pharmaceutical L:eadership Summit & Pharmaleaders Business Leadership Awards 2014 ( www.pharmaleaders2014.com ) held in Mumbai on 26th December 2014 at Hotel Sahara Star, Mumbai, India.

Pharmaleaders, Asia’s most analytical news media in healthcare communications successfully organized the 7th Annual Pharmaceutical Leadership Summit & Pharma Leaders Business Leaders Awards 2014 under the theme “Make In India – Healthcare Reforms, Insurance,Innovations,Investments & Infrastructure – “Empowering India’s Developing Healthcare System” – Investing the Healthcare Solutions of Tomorrow in difficult Times. The top Healthcare leaders of the country addressed at the 300 plus power packed audience comprising of the pharmaceutical & biotechnology industry owners, Medical Experts, Policy makers & Academic Research Scientists. Prominent speakers included Prof. (Dr) V.Mohan, CMD &  Chief Diabetologist, Dr. Mohan’s Diabetes Specialties Centre, Dr.K.S.Murthy, Chief Cardiac Surgeon & Chairman, Innova Children’s Heart Hospital, Prof. Dr. Deepak K Jumani Consultant Sexual Health Physician and Counselor, Mr. Ajit. Singh, Chairman, ACG Worldwide, Mr. Satya Brahma, Chairman & Editor-In-Chief, Pharmaleaders (A Division of Network 7 Media Group), Mr. Daara Patel, Secretary General, IDMA ( Indian Drug Manufacturers Association), Mr. Ashok jain, MD & CEO at Oxygen Healthcare Communication etc. The Highlight of the Summit was a well conceived Panel Discussion on “The New Age Medical Profession – Patient Centered Care” –  Of the patients, For the Patients & By the Patients with Prof. Dr. Chandrasekar Chikkamuniyappa, CEO, & Senior Joint Replacement Surgeon, People Tree Hospitals.,        Dr. Ruby Tandon, CEO, Afterglow Laser Clinic, Prof. Dr. Shashank R Joshi, Consultant Diabetologist, Joshi’s Clinic., Dr.Ajayita Chanana &  Founder, CEO, Dr. Ajayita’s Charak Ayurvedic Clinic, Prof. Dr Deepak K Jumani, Consultant Sexual Health Physician and Counselor , Dr.Deepak Chaturvedi, Physician Endocrinologist, Obesity & Anti-aging Consultant, Dr. Manaan Gandhi, Ayurveda Consultant, Panchakarma Clinic ,.            Prof. Dr Deepak K Jumani, Consultant Sexual Health Physician and Counselor,       Dr. Sandeep Chatrath, Chief Executive Officer, Dharamshila Hospital And Research Centre

Mr. Ajit Singh, Chairman of the Associated Capsules Group also known as ACG World Wide conferred the prestigious award to Dr. Deepak in the presence of Mr Satya Brahma of Pharmaleaders Group.

Pharmaleaders 2014 power brand awards were conferred to the successful Pharma Leaders & Medical Professionals in a sold out gala Dinner where who’s & who’s of the india healthcare industry were present. Addressing the Award Winners, Satya Brahma, Chairman & Editor-In-Chief of Pharma Leaders said “Pharmaleaders Power Brand Awards are the most prestigious annual industry awards recognized annually that acknowledge and honor individuals and organizations for their remarkable accomplishments. These are fitting tribute to those individuals and companies that have gone the extra mile to advance the excellence in healthcare through best practices and leadership, Pharmaleaders Business Leadership Awards is the premier largest business and technology leadership awards program in the sub continent , covering the set of prestigious awards spanning from biotech to Healthcare to CEO awards”. Pharma Leaders Power Brand Awards are conferred to those Companies & Individuals who exhibt rare display of innovation  for Outstanding Academic & Professional  Leadership to individuals & Companies This  top recognition symbolizes the best out of best from chosen few, Satya added.

Dr. Deepak Chaturvedi’s Achievements

Diabetes Thyroid & Hormone Clinic ™ (DTHC) is a dedicated clinic to manage Diabetes Mellitus, Obesity and Other Endocrine (Hormonal) problems under one roof. Almost, all functions of the body are directly or indirectly dependent on a healthy Endocrine (Hormone) system. Hence, a healthy Endocrine (Hormone) system is key to healthy living. The clinical cases of the Endocrine diseases (Like Diabetes Mellitus, Hypothyroidism, Addison’s Disease etc) are only the tip of the iceberg. Majority of the population is suffering from the subclinical cases. These cases need to be identified and treated before the frank disease appears. Endocrine Diseases (including Diabetes Mellitus) usually present as constellation of medical problems (syndromes).Commonly, more than one endocrine organ is involved leading to a cascade of hormonal imbalances disturbing the homeostasis and leading to various diseases.Having long standing vague symptoms like Fatigue, Lethargy, Mood disturbances, Low libido, Weight gain, Weight loss, losing muscle mass, Foggy thinking, Amotivation etc. are strong clues towards the underlying hormonal issues and should call for hormones evaluation.To address these needs, Dr. Deepak formed  Diabetes Thyroid & Hormone Clinic™ (DTHC) which is a  dedicated unit  to give patients & ailing  families a healthy and productive life.

Dr. Deepak Chaturvedi is a renowned Physician Endocrinologist, Diabetologist, Antiaging Specialist and Obesity Consultant is also an expert in Management of Obesity, Andropause, Menopause, Sexual dysfunction, Aging and Other Hormonal Issues.Dr. Deepak Chaturvedi is Physician Endocrinologist, Diabetologist, Antiaging Specialist and Bariatrician based in Mumbai with clientele from all over the globe. He is the co-founder and Medical director of “Antiaging Medicine And Research (AMAR)” AND “INDOMEDICON”; the Society and Conference forum associated with the awareness of Age Management and Hormone Corrective Therapies. He is a leading Antiaging Physician in India.Dr.Deepak Chaturvedi is part of the advisory board of various clinics national as well as international.His area of expertise include management of various endocrinologic conditions such as Obesity , Diabetes , Thyroid dysfunction , PCOD , Menopause , Andropause , Sexual Dysfunction (in men and women) , Metabolic and Immunologic conditions and other hormonal imbalances and AGING.

SEMINARS / CONFERENCES /  WORKSHOPS CONDUCTED

HIV awareness program/Lectures in various Medical and Non Medical colleges and Community.
The “Art and Science Of Anti-aging Medicine” (in association with Indian Medical Association, Mumbai) at IMA House, Haji Ali, Mumbai in February – 2008
Workshop on “Practice of Anti-aging Medicine” at Hotel Taj Lands End , Mumbai in May – 2008
INDOMEDICON the first ever “Conference cum Certification Course in Anti- Aging Medicine” (in association with Anti-aging Medicine And Research (AMAR) – India and World Society of Anti-aging Medicine (WOSAAM)) at Hotel Le Meridian, Mumbai in December – 2009.
INDOMEDICON: 2010 at Hotel Imperial Palace – Mumbai, India in June 2010
INDOMEDICON: 2011 at Hotel Tivoli Garden Resorts- New Delhi in May 2011
INDOMEDICON: 2013 – 4th Conference for Antiaging, Lifespan and Integrative Medicine to be held at Hilton Hotel and Resorts, Mumbai on 23rd and 24th of February 2013.
Delivered a lecture on “Antiaging Medicine: A novel approach” in B.J.Medical College, Pune, India, which is one of the leading tertiary care centre in India.
Introduced Antiaging Medicine Concept in the minds of the Medical fraternity at Government Medical College, Solapur, India recently through an interactive lecture session on Antiaging.
INDOMEDICON: 2014 – 5th Antiaging Medicine And Research Conference
to be held at Hotel Holiday Inn, Andheri (E), Mumbai on 14th, 15th and 16th February, 2014.
Given lectures at various other Antiaging Conferences/CMEs/Workshops
nationally as well as internationally.
Conducting regular workshops (At least 6 Seminars/workshop per year) in Antiaging Medicine for the physicians under “Antiaging Medicine And Research (AMAR)” since year 2008.

OTHER ACADEMIC ASSOCIATION / PROJECTS

Assisted Dr.Thierry Hertoghe for his books on Hormone Therapy, Thalassotherapy , Oxytocin , Phytohormones.
Editing and Compiling of Literature material in INDOMEDICON 2010 (Step 1 and Step 2).
Preparing Question papers for various Antiaging Course Examination.
Currently working on a chapter on “Hormones in Skin and Aesthetic Practice” for a “Textbook of Dermatology”.
Coming up with a “Continuing Medical Education Program in Antiaging & Regenerative Medicine” in association with Indian Medical Association.
Attachments and Affiliations
Founder and Secretary : Antiaging Medicine And Research (AMAR): The Society for Antiaging Medicine.
President : INDOMEDICON : The Antiaging Conferences and Training Body.
Vice-President : World Anti-Aging Network (WAAN)
Member : World Society of Antaging Medicine.
Medical Director : Amari Rejuvenation Clinics Pvt Ltd.
Medical Director : Atpomed Medicines India Pvt Ltd.
Medical Director and Advisor : Age Management Medicine And Research India Pvt Ltd.
Life Member : Association of Medical Consultants, Mumbai.
Life Member : Indian Medical Association.
Founder and Consultant : AMAAYA™ Antiaging & Wellness Clinic, Mumbai.
Scientific Advisor and Consultant : AMAYA™ Clinic, USA.
Co-Founder and Consultant : Diabetes, Thyroid & Hormone Clinic™ , Mumbai.
Consultant : AMAAYA™ Antiaging & Wellness Clinic.
Consultant : Life Alive, Chennai.
Trustee : Mauli Seva Pratisthan.
Consultant At :
AMAAYA™ Antiaging & Wellness Clinic :
amaayaclinic.com , drdeepak@amaayaclinic.com
Diabetes, Thyroid & Hormone Clinic™ , Mumbai :
dthc.in , drdeepak@dthc.in
Life Alive™
lifealive.in info@lifealive.in
AMAYA™ Clinic, USA :
amayaclinic.com , drdeepak@amayaclinic.com

Awards :

Awarded as the “Incredible Medical Expert of the Decade” by “The
Pharma leaders” on 27th December 2013 at Mumbai.
Awarded as “India’s Most Promising Antiaging Specialist” at “India Leadership Conclave” on 18th July 2014 at Mumbai.
Awarded the “Achievement Award-2014” by Newspaper Association of India (NAI) on 31st October 2014 at New Delhi.
Awarded as “India’s Most Promising Obesity Consultant and Best Antiaging Clinic” in Pharma Leaders Award on 26th Dec 2014 at Sahara Star Hotel Mumbai.

Belgium Nutraceuticals giant Eubage Laboratory to pump 17 Million US $ in Dr. Datsons Labs Ltd

The Deal includes licensing out 20 innovative food supplements formulations to Dr. Datsons Labs to capture the flourishing $4 billion Neutraceutical Market in india.

Tuesday,20th January 2015, New Delhi : Belgium based Eubage Laboratory has striked a major partnership agreement with the Indian Pharma Company Dr. Datsons Labs Ltd specializing in Bulk drugs, Contract manufacturing Company which is  the third-largest quinine salts manufacturer in the world and among the-largest controlled substances quota in India. As per the sources, Belgium Nutraceuticals  giant Eubage Laboratory  is expected to invest around Rs 100  crore in setting up a  nutraceuticals manufacturing facility in the state of the art facility at Dr Datson’s UK-MHRA and EU-GMP-compliant facilities, & is  ISO 9001:2008, ISO 14001:2004 and ISO 22000-certified Spanning  100,000 sq meters at unit at Mahad, Pune, India. Soon after the commissioning the plant & project by the Eubage Laboratory technical team next month. The plant initially will have a capacity of 200 tonnes annually and would scale up to 2,000 tonnes to cater to the domestic requirements of the country. Both the company are also  in talks with various players in various parts of the world for exports of nutraceutical products wherever Belgium Nutraceuticals  giant Eubage Laboratory is not present specially in middle east and it would be primarily to the European and other Asian countries. Pharmaceutical companies are the buyers for these products. Nutraceuticals is estimated to become $4 billion market in India by 2018 & the demand for this segment is growing with the forecast the Indian RTE food market is projected to grow at a CAGR of 22 per cent during 2014-19. With the passage of time and due to many international and local players in this segment, the percentage share rose with a rapid pace. Belgium company will  license out 20 innovative food supplements formulations to Dr. Datsons Labs & will invest 100 Crore in Datson Labs Pune Factory. The Belgium delegation met the senior Board Members of Dr. Datsons Labs Ltd in Singapore to source some essential raw materials to be used for the finished formulations as the compositions in about six to seven products are not available in india. To confirm the news on this development, Pharmaleaders reached out to the promoters via mail/sms & voice, however, no one were available to comment till the release of this news, though the officials from the Eubage Laboratory confirmed the developments.

The collaboration & investment by Eubage Laboratory include 100 crore funding to the new project to Dr. Datsons Labs Ltd, a technology transfer agreement, license out 20 innovative food supplements formulations to Dr. Datsons Labs, a top Indian Pharma company to market the range of 20 products that include the revolutionary ingredients to be launched for the first time in india. Both Indian & Belgium Company will market the products by a top Indian Pharma company with a pan india base to reach out growing markets.

The Advantage Factors with Eubage Laboratory

amylase, proteases, papain, ficain, bromelain, cellulase
participates in the process of detoxification, drainage and the functioning of liver
participates in the stimulation and maintenance of memory  and cognitive functions from students to seniors
promotes urinary comfort, regular micturitions and creates a hostile environment to micro-organisms
ensures an optimal ionic absorption of calcium, magnesium and dietary minerals in order to keep a good acid-base balance
participates in carbohydrate conversion and balanced  glucose level
participates in emotional moderation, inducing better mental provisions, fast recovery and greater attention
participates in the removal of the heavy legs effect, swollen and sensitive reducing aqueous excess in lower limbs
regroups the most powerful antioxidants stimulating natural defenses and reducing the effects of lipid peroxides.
helps to reduce the uncomfortable effects of premenopause and menopause
contributes to a better resistance to menopausal effects by different phytoestrogens
helps to support an hormonal balance and a comfortable premenopause menopause by providing phytoprogesterones
participates in the intensification and endurance of men performances
participates in the protection of organic tissues and sustains the body reactivity during inflammation
participates in comfortable diuresis of men
participates to faster physical recovery and efficient cognitive functions
participates in an optimal cholesterol level and reduces the effects of triglycerides
improves metabolic provisions under stress and sustains concentration and memory
participates in strengthening antioxidant defenses and to improve the visual acuity
helps to maintain lubricated, flexible and protected joints
sustains skeleton by mineralization and maintenance of bone density

According to experts, nutraceuticals & functional foods would help mitigate malnutrition in India. Although, there is a huge potential for the growth of the sector, yet its development is slow. The country has a long way to go to en-cash much of its bio-agri wealth.

Speaking to Mr. Satya Brahma, Editor-In-Chief, Pharmaleaders Group, on the reason of investing in an Indian Company, Mr. Francois Liccope, CEO, Eubage Laboratories said, “there has been an increasing awareness among the rising affluent middle class about health and wellness. Nearly 400 million people in India belong to the middle class and have disposable income which have made them capable of buying nutraceuticals and dietary supplements. It is an inevitable fact that affluence is one of the causes of lifestyle diseases, which nutraceuticals and dietary supplements often address. These factors will support the double digit growth of the industry in the coming few years”. Nutraceuticals could complement drugs and can reduce over-dependence on medicines for treatment. There is considerable scope for value-addition of agri-by products. The biodiversity and traditional knowledge could make India a world leader in nutraceutical market.

Speaking on the scientific & technical edge over other players, Francois said “Eubage Laboratory develops its know-how and expertise to ensure reliable, efficient and traceable, productions. It has a Careful selection of raw materials & a highly trained  Team of dedicated and approved professionals. Totally independent of any pharmaceutical group, Eubage Laboratory is distinguished by its flexibility and responsiveness. The Eubage ranges are marketed in several European countries under different types of representation, and preferred collaborations are established with  partners for the distribution of those productions under our own brand or under the label of the distributor. Scientific and trade services of  Eubage Laboratory are available for any feasibility study, in different dosage forms.Eubage  Laboratory provides an advanced  response to ethical nutrient and nutritional supplement markets throughout various countries. Our Innovation: The Catalyst C89 Enzymes are biological catalysts involved in many reactions essential for the proper functioning of a living organism. These macromolecules of proteins or RNA specifically recognize several molecules and accelerate transforming reactions to made their speed consistent with the functioning of the organism: they are biological catalysts, or biocatalysts. Enzyme activity regulation can normalize cellular metabolism. This activity depends strongly on the conformation of the enzyme, and thus of the shape of its sites, which can be modified via phosphorylation and dephosphorylation.Convergence point of several catabolic reactions of cellular metabolism, discovered by the biologistHans Adolf Krebs in 1937, the “Krebs Cycle” is a series biochemical reactions whose purpose is to produce energy feedstocks which will be used for ATP production in the respiratory chain. Composed of 8 steps each of which is catalyzed by a specific enzyme active during processing a chemical reaction in order to change its rate of reaction, both homogeneous and heterogeneous, in aerobic conditions, these enzymes, localized in the mitochondrial matrix or at the inner mitochondrial membrane, catalyze this reaction sequence. The Krebs Cycle is the ultimate degradation process of different metabolites.

Dietary supplements are the largest category accounting for 64 per cent of the nutraceuticals market, driven primarily by the pharmaceutical sector in the form of vitamin and mineral supplements. Functional foods will be the quickest growing category until 2015 followed by dietary supplements.However, dietary supplements, specifically herbal and dietetic supplements, will form the greatest opportunity areas for nutraceutical manufacturers, driven by growing demand from an evolving consumer base. Most of the leading pharmaceuticals companies have ventured into nutrition and nutraceuticals space and have a growing portfolio of such products which targets various therapeutic segments. This trend is increasingly on the rise and will continue to grow to a large extent in turn adding to the growth of the nutraceuticals industry.

With the growing popularity of these supplemented foods, many multinationals are investing in the nutraceuticals market in India. These include Monsanto, American Home Products, DuPont, BioCorrex, Abbott Laboratories, GlaxoSmithKline Consumer Healthcare, Johnson & Johnson, Nestle, Novartis, Yakult-Danone India, Herbalife etc. These players are a major resource for nutraceuticals and related dietary supplements. Besides, India has many local players such as Dabur India, Cadila Healthcare, British Biologicals, Himalaya Global Holdings, Sami Labs, Sami Direct, Parry Nutraceuticals, Wockhardt etc.

The global demand for nutraceutical ingredients is forecast to rise 7.2 per cent annually to $30 billion in 2017 according. The best growth prospects will exist in substances with clinically supported health benefits and broad applications in foods, beverages, dietary supplements and adult and pediatric nutritional preparations.

Countries such as Brazil, China, India, Mexico and Turkey will be among the fastest growing consumers and producers of nutraceutical ingredients worldwide. Increasing economic prosperity will enable these countries to expand and diversify their food and beverage, processing, and pharmaceutical industries. In 2017, China, alone, will absorb more than 16 per cent of the value of global nutraceutical ingredient demand and will account for over 18 per cent of the value of related world shipments. Because of maturing markets, the supply and demand of nutraceutical ingredients in the United States, Western Europe, and other developed economies will increase more slowly than the average worldwide pace. Nonetheless, food, beverage and pharmaceutical companies in these economies will continue to pursue opportunities in conventional and speciality nutritional products and natural medicines. As a result, they will remain key customers for nutraceutical ingredients.

Nutrients, including proteins, fibres and various specialized functional additives, will remain the top-selling group of nutraceutical ingredients worldwide. Proteins will post the fastest demand gains as food and beverage makers throughout the world will introduce new high value-added nutritional preparations. Functional additives and fibre nutrients will also fare well in the global marketplace.Demand for these ingredients will gain upward momentum from increasing clinical evidence of health benefits and expanding applications in speciality foods and beverages.Naturally derived substances, consisting of herbal and botanical extracts and animal- and marine-based derivatives, will see the fastest growth among the three major groups of nutraceutical ingredients. Among these substances, omega fatty acids derived from fish oils and other marine sources will lead gains, reflecting clinically proven cardiovascular benefits and expanding use in dietary supplements and nutritional therapies.

The rising popularity of preventive medicine will impact favourably on global demand for numerous other natural extracts and derivatives, including cranberry, garlic, ginkgo biloba, ginseng; and glucosamine and chondroitin.Well established applications in food and beverage fortification; infant, adult, and paediatric nutritionals; and dietary supplements will continue to be a large global market for mineral and vitamin ingredients. Within this group, essential minerals such as calcium, along with vitamin A and vitamin C substances, will post the fastest gains in world demand.

Pharmaleaders survey indicated that there are more than 8,000 registered and non-registered nutraceuticals, herbs and related companies in India but most of them are small and medium enterprises. The increasing need for additional nutrition and food security concerns in India has resulted in government to introduce schemes for vitamin fortification.

Overall, the Indian nutraceutical market is emerging with strong growth potential. With increasing health awareness, and the shift towards preventative health care and increased regulatory clarity, India’s future in nutraceuticals industry looks promising, for both manufacturers and consumers. However, there is a strong need of developing customized products, affordable pricing and distribution strategy. Though India holds only 10 per cent market share in the global nutraceutical market that will be a $250 billion industry by 2018, the country has a definite edge over China, which is the first rank holder in the industry, with better research and quality compliance. Industry experts point out that as the world back off from buying food supplements and nutraceuticals from China due to pollution and quality issues, India has a great advantage in the global market. The term Nutraceutical is applied to products that range from isolated nutrients, dietary supplements and herbal products, specific diets and processed foods such as cereals, soups, and beverages.

Though the annual growth rate of the industry is 7 per cent, in India it is growing at around 20 per cent annually. The country has a huge potential in this segment as 7,000 medicinal plants were identified in the country, but nutraceutical properties of majority of these plants remain untapped. The products from India are being exported to the US, Europe and Far East Asian countries.“As the quality standards in the US and Europe have been increasing continuously, China is losing its grip due to pollution and contamination problems. Even though China produces at least 10 times more these products, in terms of quality parameters India is far ahead. The awareness about the side effects of drugs is increasing drastically around the world which throws up good opportunities for Nutraceuticals and India. If we invest more on research, we could be a super power in the sector,” said Francois. Nutraceuticals are the exaggerated version of Ayurveda in which India has surely an upper hand. Companies from India are making strides in this market and the global presence of Indian products has been increasing recently.China is presently the second largest consumer and largest producer of the Nutraceuticals in the world. On the other hand, countries such as South Korea and Australia have also noticed an increasing growth trajectory in the Nutraceuticals market.

About Eubage Laboratory

Eubage Health Innovation is a trademark which develops and markets food supplements under its own brand and under the brand of third parties. From articulation to inflammation, from ophthalmology to stress, from menopause to urinary comfort, we are active in various therapeutic areas. The entire range is based on enzymology. An enzymatic complex that increases the bioavailability of different nutrients is added in each of our formulations. This enzymatic complex has obtained positive pre clinical results. Those trials have been done by the University of Liege. These products are registered by the Belgian Health Ministry and have obtained the authorizations needed in other European countries like France (DGCCRF), Portugal, Lithuania,… and abroad like Pakistan, Vietnam.Eubage Laboratory develops, manufactures and markets a broad range of optimal quality ethical nutrients and nutritional supplements. These realizations confirm the best guarantee in terms of analysis, traceability and purity of raw materials respecting the good manufacturing practices established (GMP). Eubage Laboratory develops, produces and markets ethical nutrients and nutritional supplements of pharmaceutical quality. By strictly adhering to the pharmaceutical industry’s good manufacturing processes (GMP), Eubage laboratory offers the strongest guaranties in terms of analysis, traceability and purity of all raw materials used in the development of exclusive formulas that guarantee an optimal result. Eubage Laboratory is a parapharmaceutical company based in Belgium which develops and markets food supplements under its own brand and under the brand of third parties. The company has launched twenty formulations and obtained from the competent authorities (SPF Santé Publique) its nutrients numbers. The entire range is based on enzymology. An enzymatic complex that increases the bioavailability of different nutrients is added in each of our formulations. This enzymatic complex has obtained positive pre clinical results. These products are registered with the APB (Belgian Pharmaceutical Association) and have obtained the authorizations needed in other European countries like France (DGCCRF).

About Dr. Datsons Lab Ltd

Dr. Datsons Lab Ltd, formerly known as Aanjaneya Lifecare Ltd, BSE code (533412) is a public listed vertically integrated company having state-of-the-art; WHO GMP approved facilities for manufacturing bulk drugs at Mahad and finished dosage forms at Pirungut near Pune. It is one of the largest contract manufacturers of codeine based cough syrups in India. The company exclusively manufactures the Codorex Brand of Zydus Cadilla and Codilite Brand of Tablets India Ltd. amongst others.The company raised about Rs. 117 crore from its IPO and the funds are being used to built new capacities along with the refurbishing of Research & Development centre. The new facilities being created as part of CAPEX are using eco friendly, recyclable material and will be rated by LEEDS once completed.The Facilities being established will comply with the latest European & US guidelines. With new capacities to be added in next 6 to 9 months the company will be expanding operations in emerging markets of South East Asia, Africa & South & Central America and its domestic operation in branded generics segment. The company with its manufacturing facilities –in Mahad, Hyderabad and Pune has to its credit many achievements. It is the world’s third-largest manufacturer of quinine salts in the world . Only nine companies globally manufacture quinine salts.One of the largest codeine based formlulations manufacturer in the pharmaceutical sector. One of the largest manufacturer of multi- flavored Lozenges in  medical products in India. The company pioneered the recognition that lozenges represent a stable platform for the delivery of pharmaceutical and nutraceutical ingredients. Dr. Datson’s Nicco Nil lozenge is a first-of-its-kind  hard boiled lozenge remedy for smoking de-addition; its Relacs is a first-time lozenge against insomnia and Arecta Plus, a lozenge variant for Erectile Dysfunction, is a first of its kind . The company has an expertise in opportunity spotting and innovation. The company’s success has been built on a business model that integrates Research, Innovation and Knowledge. The company has invested in building proprietary Knowledge through research and acquisitions. Dr. Datson’s competence has been validated through patents granted by international and Indian authorities. Production of Quinine Sulphate increased 30% in 2011-2012. Sales of Quinine Sulphate grew 45%. Exports increased 250% from Rs 10 Crore to Rs 31 crore. Added 35 international and 50 domestic clients. Completed trials for Bromexine(expectorant)a new API that will be launched in 2012-1023. Highlights 2011-2012 for Finished Dosage Forms. Launched ‘Rancorex’ an in-house codine based cough syrup brand for the first time in its history. received the Kenya PPB GMP approval from all facilities namely lozenges,liquids and ointments. Received registration for ‘Arecta Plus’(a lozenge variant of Viagra tablets)from Sierrs Leone and Libya; received the first export order for this product to be executed in 2012-2013.

Media Contacts

Steve Rozer

Global Head – Communications

stever@network7mediagroup.com

President Obama wins India’s heart, signals to China India is with US, Modi wins Obama, Signals as a Global Leader!

President Obama wins India’s heart, signals to China India is with US, Modi wins Obama, Signals as a Global Leader!

NEW DELHI—U.S. President Barack Obama was set to join Indian leaders at a parade here Monday as the world’s second-most-populous nation shows off its military modernization efforts and cultural diversity.Mr. Obama’s attendance is meant to be an important display of solidarity between the world’s two largest democracies in the face of an increasingly assertive, well-armed and authoritarian China that is shifting the balance of power in Asia.The U.S. president’s three-day visit to India during the country’s symbolically important Republic Day celebrations marks a significant deepening in relations between the two countries amid mounting geopolitical tensions globally.

Obama Visit to India Marked by Woman Power
On Sunday, Indian Prime Minister Narendra Modi said that Mr. Obama’s visit “reflects the transformation of our relationship,” and said New Delhi and Washington “are prepared to step forward firmly to accept the responsibility of this global partnership—for our two countries and for the shaping the character of this century.”

This is the first time India—which spent much of the Cold War espousing nonalignment and nurturing ties with Russia as the U.S. cultivated New Delhi’s rivals, Pakistan and China—has invited an American head of state for the event.Mr. Obama’s acceptance is a sign of renewed U.S. hope that India, under the leadership of a new government elected last year, will be able to achieve the sustained economic development that has long eluded it but is critical if the country is ever to become an effective strategic counterweight to China.After a summit meeting between Messrs. Obama and Modi on Sunday, the two leaders said they would deepen defense cooperation, increasing joint exercises between the two countries’ armies and navies. They also agreed to work to jointly develop and produce defense technologies.U.S. Defense Secretary Chuck Hagel said the countries would form working groups to explore aircraft-carrier technology sharing as well as work on jet engines.India has been working to upgrade its defense equipment, which for years was mostly supplied first by the Soviet Union and then Russia. Over the past three budget years, however, India has purchased more weapons from the U.S. than from Moscow.Monday’s parade was to feature flybys by a Boeing Co. -made P-8I antisubmarine-warfare plane and a Lockheed Martin C-130J transport, which India has made a point of landing at a high-altitude airstrip to demonstrate its ability to rush troops and equipment to the country’s Himalayan border with China.Among the other military hardware expected to be on display: Russian warplanes and homegrown missiles that are being deployed in northeastern India.India, while trying to deepen commercial ties with China to fuel its own economy, is deeply distrustful of Beijing, with which it has competing territorial claims. New Delhi also resents China’s rising aid-driven influence among its South Asian neighbors and Beijing’s greater naval presence in the Indian Ocean.

It is a great pleasure and privilege to welcome back President Obama and the First Lady in India.

Mr. President, we are honored that you accepted our invitation to be the Chief Guest for our Republic Day, despite a busy January.It is special because on this day we celebrate the values shared by the world’s two largest democracies.You are also the first United States President to visit India twice in Office.It reflects the transformation in our relationship. It shows your deep personal commitment to this partnership.It tells us that our two nations are prepared to step forward firmly to accept the responsibility of this global partnership – for our two countries and for shaping the character of this century.The promise and potential of this relationship has never been in doubt. This is a natural global partnership. It has become even more relevant in the digital age. It is needed even more in our world of far-reaching changes and widespread turmoil.The success of this partnership is important for our progress and for advancing peace, stability and prosperity around the world.From the turn of this century, we have begun transforming our relationship.But, we have to convert a good start into lasting progress. This requires translating our vision into sustained action and concrete achievements.

Mr. President, in the last few months, I see new excitement and confidence in this relationship. I see renewed energy in our engagement. I thank you for your leadership and for setting the tone last September.The civil nuclear agreement was the centrepiece of our transformed relationship, which demonstrated new trust. It also created new economic opportunities and expanded our option for clean energy. In the course of the past four months, we have worked with a sense of purpose to move it forward. I am pleased that six years after we signed our bilateral agreement, we are moving towards commercial cooperation, consistent with our law, our international legal obligations, and technical and commercial viability.President Obama has also assured me of strong U.S. efforts in support of India’s full membership of the four international export control regimes at the earliest.Today, we have also decided to take our growing defence cooperation to a new level. We have agreed, in principle, to pursue co-development and co-production of specific advanced defence projects. These will help upgrade our domestic defence industry; and expand the manufacturing sector in India.We will also explore cooperation in other areas of advanced defence technologies.We have renewed our Defence Framework Agreement. We will deepen our cooperation on maritime security.Terrorism remains a principal global threat. It is taking on a new character, even as existing challenges persist. We agreed that we need a comprehensive global strategy and approach to combat with it. There should be no distinction between terrorist groups. Every country must fulfil its commitments to eliminate terrorist safe havens and bring terrorists to justice.Our two countries will deepen our bilateral security cooperation against terrorist groups. And, we will further enhance our counter-terrorism capabilities, including in the area of technology.President Obama and I agree that a strong and growing economic relationship is vital for the success of our strategic partnership. Economic growth in our two countries is becoming stronger. Our business climate is improving. This gives me great optimism about our economic ties.In addition, we have established a number of effective bilateral mechanisms to identify opportunities and also help our businesses trade and invest more.We will also resume our dialogue on Bilateral Investment Treaty. We will also restart discussions on a Social Security Agreement that is so important for the hundreds of thousands of Indian professionals working in the United States.For President Obama and me, clean and renewable energy is a personal and national priority. We discussed our ambitious national efforts and goals to increase the use of clean and renewable energy. We also agreed to further enhance our excellent and innovative partnership in this area. I asked him to lead international efforts in making renewable energy more accessible and affordable to the world. President and I expressed hope for a successful Paris Conference on climate change this year.We will continue to deepen our collaboration in science, technology, innovation, agriculture, health, education and skills. These are central to the future of our two countries; and also give us an opportunity to help others around the world.Indeed, our strategic partnership will only be complete if we assume our responsibility to work together to promote development and connectivity in our vast region. President Obama and I agreed to pursue this goal with a sense of priority.President and I had an excellent discussion on global and regional issues. In particular, we renewed our commitment to deepen our cooperation to advance peace, stability, prosperity in Asia, Pacific and Indian Ocean Region, which is critical for the future of our two countries and the destiny of this world.Our relationship stands at a new level today. We have outlined a broad vision for our friendship and cooperation that reflects the opportunities and challenges of this century. As Lord Buddha said, noble friends and companions are the whole of the holy life.We have decided to give this critical partnership a new thrust and sustained attention. For this, we have agreed that India and the United States must have regular summits at greater frequency. And, we will also establish hotlines between us and our National Security Advisors.At the beginning of this year, we start a new journey.Let me welcome you once again, Mr. President. It is a great pleasure to have you with us.