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Ministry of Finance
Dated: 13 MAY 2020
Hon’ble Prime Minister Shri NarendraModiyesterday announced a Special economic and comprehensive package of Rs 20 lakh crores - equivalent to 10% of India’s GDP.He gave a clarion call for आत्मनिर्भरभारतअभियान or Self-Reliant India Movement. He also outlined five pillars of Aatmanirbhar Bharat – Economy, Infrastructure, System, Vibrant Demography and Demand.
During the press conference here today, Union Minister of Finance & Corporate Affairs Smt. NirmalaSitharaman said in her opening remarks that Prime Minister Shri NarendraModihad laid out a comprehensive vision in his address to the Nation yesterday. She further said that after spending considerable time, the Prime Minister has himself ensured that inputs obtained from widespread consultationform a part of economic package in fight against COVID-19.
“Essentially, the goal is to build a self-reliant India that is why the Economic Package is called AatmaNirbhar Bharat Abhiyaan. Citing the pillars on which we seek to build AatmaNirbhar Bharat Abhiyaan, Smt. Sitharaman said our focus would be on land, labour, liquidity and law.
The Finance Minister further said that the Government under the leadership of Prime Minister Shri NarendraModi has been listening and is a responsive Government, hence it is fitting to recall some reforms which have been undertaken since 2014.
“Soon after Budget 2020 came COVID-19 and within hours of the announcement of Lockdown 1.0, Pradhan MantriGaribKalyanYojna (PMGKY) was announced,” Smt.Sitharaman said. She further said that we are going to build on this package.
“Beginning today, for the next few days, I shall be coming here with the entire team of the Ministry of Finance to detail the Prime Minister’s vision for AatmaNirbhar Bharat laid out by the Prime Minister yesterday,”SmtSitharaman said.
Smt. NiramlaSitharaman today announced measures focused on Getting back to work i.e., enabling employees and employers, businesses, especially Micro Small and Medium Enterprises, to get back to production and workers back to gainful employment. Efforts to strengthen Non-Banking Finance Institutions (NBFCs), Housing Finance Companies (HFCs), Micro Finance Sector and Power Sector were also unfolded. Other than this, the tax relief to business, relief from contractual commitments to contractors in public procurement and compliance relief to real estate sector were also covered.
Over the last five years, the Government has actively taken various measures for the industry and MSME. For the Real Estate sector, the Real Estate (Regulation and Development) Act [RERA] was enacted in 2016 to bring in more transparency into the industry.A special fund for affordable and middle income housing was set up last year to help with the stress in this segment. To help MSMEs with the issue of delayed payment by any Government department or PSUs, Samadhaan Portal was launched in 2017. A Fund of Funds for startups was set up under SIDBI to boost entrepreneurship in the country and various other credit guarantee schemes to help flow of credit to the MSMEs.
Following measures were announced today:-
To provide relief to the business, additional working capital finance of 20% of the outstanding credit as on 29 February 2020, in the form of a Term Loan at a concessional rate of interest will be provided. This will be available to units with uptoRs 25 crore outstanding and turnover of up to Rs 100 crore whose accounts are standard.The units will not have to provide any guarantee or collateral of their own. The amount will be 100% guaranteed by the Government of India providing a total liquidity of Rs. 3.0 lakh crores to more than 45 lakh MSMEs.
Provision made forRs. 20,000 cr subordinate debt for two lakh MSMEs which are NPA or are stressed. Government will support them with Rs. 4,000 Cr. to Credit Guarantee Trust for Micro and Small enterprises (CGTMSE). Banks are expected to provide the subordinate-debt to promoters of such MSMEs equal to 15% of his existing stake in the unit subject to a maximum of Rs 75 lakhs.
Govt will set up a Fund of Funds with a corpus of Rs 10,000 crore that will provide equity funding support for MSMEs. The Fund of Funds shall be operated through a Mother and a few Daughter funds. It is expected that with leverage of 1:4 at the level of daughter funds, the Fund of Funds will be able to mobilise equity of about Rs 50,000 crores.
Definition of MSME will be revised by raising the Investment limit. An additional criteria of turnover also being introduced. The distinction between manufacturing and service sector will also be eliminated.
e-market linkage for MSMEs will be promoted to act as a replacement for trade fairs and exhibitions. MSME receivables from Government and CPSEs will be released in 45 days
General Financial Rules (GFR) of the Government will be amended to disallow global tender enquiries in procurement of Goods and Services of value of less than Rs 200 crores
The scheme introduced as part of PMGKP under which Government of India contributes 12% of salary each on behalf of both employer and employee to EPF will be extended by another 3 months for salary months of June, July and August 2020. Total benefits accrued is about Rs 2500 crores to 72.22 lakh employees.
Statutory PF contribution of both employer and employeereduced to 10% each from existing 12% each for all establishments covered by EPFO for next 3 months. This will provide liquidity of about Rs.2250 Crore per month.
Government will launch Rs 30,000 crore Special Liquidity Scheme, liquiditybeing provided by RBI. Investment will be made in primary and secondary market transactions in investment grade debt paper of NBFCs, HFCs and MFIs. This will be 100 percent guaranteed by the Government of India.
Existing Partial Credit Guarantee scheme is being revamped and now will be extended to cover the borrowings of lower rated NBFCs, HFCs and other Micro Finance Institutions (MFIs). Government of India will provide 20 percent first loss sovereign guarantee to Public Sector Banks.
Power Finance Corporation and Rural Electrification Corporation will infuse liquidity in the DISCOMS to the extent of Rs 90000 crores in two equal instalments. This amount will be used by DISCOMS to pay their dues to Transmission and Generation companies. Further, CPSE GENCOs will give a rebate to DISCOMS on the condition that the same is passed on to the final consumers as a relief towards their fixed charges.
All central agencies like Railways, Ministry of Road Transport and Highways and CPWD will give extension of up to 6 months for completion of contractual obligations, including in respect of EPC and concession agreements
State Governmentsare being advised to invoke the Force Majeure clause under RERA. The registration and completion date for all registered projects will be extended up to 6 months and may be further extended by another 3 months based on the State’s situation. Various statutory compliances under RERA will also be extended concurrently.
The pending income tax refunds to charitable trusts and non-corporate businesses and professions including proprietorship, partnership and LLPs and cooperatives shall be issued immediately.
a) Reduction in Rates of ‘Tax Deduction at Source’ and ‘Tax Collected at Source” - The TDS rates for all non-salaried payment to residents, and tax collected at source rate will be reduced by 25 percent of the specified rates for the remaining period of FY 20-21.This will provided liquidity to the tune of Rs 50,000 Crore.
b) The due date of all Income Tax Returns for Assessment Year 2020-21 will be extended to 30 November, 2020. Similarly, tax audit due date will be extended to 31 October 2020.
c) The date for making payment without additional amount under the “Vivad Se Vishwas” scheme will be extended to 31 December, 2020.
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RM/KMN
(Release ID: 1623601)
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
New Delhi, May 8th, 2020
PRESS RELEASE
New procedure for registration, approval, etc.of certain entities deferred to 1st October, 2020
In view of the unprecedented humanitarian and economic crisis, the CBDT has decided that the implementation of new procedure for approval / registration / notification of certain entities shall be deferred to 1st October, 2020. Accordingly, the entities approved/ registered/ notified under section 10(23C), 12AA, 35 and 80G of the Income-tax Act, 1961 (the Act) would be required to file intimation within three months from 1st October, 2020, i.e, by 31st December, 2020. Further, the amended procedure for approval/ registration/ notification of new entities shall also apply from 1st October, 2020.
The necessary legislative amendments in this regard shall be proposed in due course.
Various representations were received in the finance ministry expressing concerns over the implementation of the new procedure from 1st June, 2020 due to the outbreak of novel corona virus (COVID-19) and consequent lockdown. There have been a number of requests to defer the applicability of the new procedure.
It may be noted that The Finance Act, 2020 rationalized the procedure relating to approval/ registration/ notification of certain entities referred to in sections 10(23C), 12AA, 35and 80G of the Act, with effect from 1st June, 2020. As per the new procedure, the entities already approved/ registered/ notified under these sections would be required to file intimation within three months, i.e, by 31st August, 2020. Further, the procedure for approval/ registration/ notification of new entities has also been rationalized with effect from 1st June, 2020.
(Surabhi Ahluwalia)
Commissioner of Income Tax
(Media & Technical Policy)
Official Spokesperson, CBDT
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
New Delhi, May 8th, 2020
PRESS RELEASE
Clarification in respect of residency under section 6 of the Income-tax Act, 1961
Section 6 of the Income-tax Act, 1961 (the Act) contains provisions relating to residency of a person. The status of an individual as to whether he is resident in India or a non-resident or not ordinarily resident, is dependent, inter-alia, on the period for which the person is in India during a year.
Various representations have been received stating that there are number of individuals who had come on a visit to India during the previous year 2019-20 for a particular durationand intended to leave India before the end of the previous year for maintaining their status as non-resident or not ordinary resident in India. However due to declaration of the lockdown and suspension of international flights owing to outbreak of Novel Corona Virus (COVID-19), they are required to prolong their stay in India. Concerns have been expressed that they may involuntarily end up becoming Indian residents without any intention to do so.
In order to avoid genuine hardship in such cases, the CBDT has decided vide circular no 11 dated May 8, 2020, that for the purposes of determining the residential status under section 6 of the Act during the previous year 2019-20 in respect of an individual who has come to India on a visit before 22nd March, 2020 and:
(a) has been unable to leave India on or before 31st March 2020, his period of stay in India from 22nd March, 2020 to 31st March, 2020 shall not be taken into account; or
(b) has been quarantined in India on account of Novel Corona Virus (Covid-19) on or after 1st March, 2020 and has departed on an evacuation flight on or before 31st March, 2020 or has been unable to leave India on or before 31st March, 2020, his period of stay from the beginning of his quarantine to his date of departure or 31st March, 2020, as the case may be, shall not be taken into account; or
(c) has departed on an evacuation flight on or before 31st March, 2020, his period of stay in India from 22nd March, 2020 to his date of departure shall not be taken into account.
Further, as the lockdown continues during the Financial Year 2020-21 and it is not yet clear as to when international flight operations would resume, a circular excluding the period of stay of these individuals up to the date of normalisation of international flight operations, for determination of the residential status for the previous year 2020-21 shall be issued after the said normalisation.
(Surabhi Ahluwalia)
Commissioner of Income Tax
(Media & Technical Policy)
Official Spokesperson, CBDT
Ministry of Finance
Dated: 26 APR 2020
The Central Board of Direct Taxes (CBDT) has said today that there is some report circulating on social media regarding suggestions by a few IRS officers on tackling COVID-19 situation.
It is unequivocally stated that CBDT never asked IRS Association or these officers to prepare such a report. No permission was sought by the officers before going public with their personal views and suggestions on official matters, which is a violation of extant Conduct Rules. Necessary inquiry is being initiated in this matter.
It is reiterated that the impugned report does not reflect the official views of CBDT/Ministry of Finance in any manner.
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RM/KMN
(Release ID: 1618493)
Press Information Bureau
Government of India
Ministry Of Law & Justice
Dated: 24 APR 2020
Income Tax Tribunal, ITAT, for the first time, holds hearing through video conferencing
A division bench of the Income Tax Appellate Tribunal (ITAT), led by the Tribunal’s President Justice P.P. Bhatt, has, through web based video conferencing platform, heard and disposed of an urgent stay petition today. This is a first in the 79-year-old history of this Tribunal. The petition was heard by a two member bench of the ITAT Mumbai, comprising Justice Bhatt and Vice President, ITAT, Shri Pramod Kumar, through VC from their home offices since closure of the ITAT due to the COVID-19 lockdown.
The appellate, Solapur based Pandhes Infracon Pvt Ltd. had sought an extremely urgent hearing of its stay petition on a notice of recovery of Rs.2.91 crores dues by Income Tax, Mumbai office for Assessment Year 2010-11. The Company had earlier moved the Bombay High Court, but were directed to approach the ITAT first.
Granting the stay, the ITAT bench suspended all notices issued by the revenue authorities on the bankers and debtors of the Company. The Departmental representative, who was present during the course of hearing, was directed by the bench to inform the stay order to the Assessing Officer/Field Officer. The bench meanwhile directed the Company’s related appeal for hearing on out of turn basis will be taken up on 8th June 2020.
The ITAT benches based in 27 locations are equipped to hold similar hearings through VC on petitions made by assesses or revenue department on urgent matters as and when exigencies arise.