Granting notional increment for pensionary benefits in pursuance of the judgement dated 15.09.2017 of Hon’ble High Court of Madras in W.P. No. 15732 of 2017 in the case of P. Ayyamperumal Vs Union of India & Ors
F.No.19/2/2018-Estt (Pay-I)
Government of India
Ministry of Personnel, Public Grievances & Pensions
(Department of Personnel & Training)
North Block, New Delhi
Dated: 3rd February, 2021
OFFICE MEMORANDUM
Subject : References/ Representations/ Court cases for granting notional increment for pensionary benefits in pursuance of the judgement dated 15.09.2017 of Hon’ble High Court of Madras in W.P. No. 15732 of 2017 in the case of P. Ayyamperumal Vs Union of India & Ors-regarding.
***
The undersigned is directed to refer to references/ representations/ court cases/ VIP references, received in this Department in large numbers on the issue of granting notional increment for pensionary benefits to those Central government servants who have retired on 30th June/ 31st December of a year, in pursuance of the judgement dated 15.09.2017 of Hon’ble High Court of Madras in W.P. No. 15732 of 2017 in the case of P. Ayyamperumal Vs Union of India & Ors.
2. The issue has been examined in this Department in consultation with Department of Legal Affairs and it has been observed that the judgement dated 15.09.2017 of Hon’ble High Court of Madras in W.P. No.15732 of 2017 in the case of P. Ayyamperumal Vs Union of India & Ors. is ‘in personam’ in nature. A brief note reflecting the Government’s stand on this issue is attached as Annexure-1.
3. Further, it is also mentioned that in a similar case, the Hon‘ble Supreme Court, vide judgment dated 29.03.2019 (copy enclosed as Annexure-II) , while dismissing the SLP (C) Dy. No.6468/ 2019 filed by D/ o Telecommunications against the judgment dated 03.05.2017 of Hon’ble High Court, Lucknow Bench in WP No.484/2010 in the matter of UOI & Ors. Vs. Sakha Ram Tripathy & Ors., has, inter alia, observed the following:
“There is delay of 566 days in filing the special leave petition. We do not see any reason to condone the delay. The Special leave petition is dismissed on delay, keeping all the questions of law open.”
4. Since the question of law is open and not yet decided, decision for implementation of the judgement dated 15.09.2017 of Hon’ble High Court of Madras in W.P. No. 15732 of 2017 in Shri P. Ayyamperumal case, in rem has not been taken.
5. Accordingly, all Ministries/ Departments are, therefore, advised to dispose of all pending grievances seeking notional increment for pensionary benefits and also to defend the various pending Court Cases in this matter.
6. In their application to the persons belonging to Indian Audit and Accounts Department, these orders are issued under Article 148(5) of the Constitution and after consultation with the Comptroller and Auditor General of India.
7. Hindi Version will follow.
(Murali Bhavaraju)
Deputy Secretary to the Government of India
Tel. No.011-23094542
All Ministries/ Departments of Government of India. Copy also forwarded to:-
1. The Comptroller & Auditor General of India.
2. Secretary General, Supreme Court of India.
3. Controller General of Accounts/ Controller of Accounts, Ministry of Finance.
4. Union Public Service Commission / Lok Sabha Sectt./ Rajya Sabha Sectt./ Cabinet Sectt./ Central Vigilance Commission / President’s Sectt./ Vice-President’ s Sectt/ Prime Minister Office/ Niti Aayog.
5. Government of all States and Union Territories
6. Department of Personnel and Training (AIS Division) / JCA/ Admn. Section
7. Secretary, National Council of JCM (Staff Side), 13-C, Feroz shah Road, New Delhi.
8. All Members of Staff Side of the National Council of JCM / Department Council.
9. All Officers/ Sections of Department of Personnel and Training/ Department of Administrative Reforms & Public Grievances/ Department of Pensions & Pensioners’ Welfare / PESB.
10. Joint Secretary (Pers.) , Department of Expenditure, Ministry of Finance
11. Additional Secretary (Union Territories) , Ministry of Home Affairs.
12. NIC, DOPT – with request to upload this O.M. on the Department’s website under OMs & Orders (Establishment-Pay Rules) and also under “What is New”.
13. Hindi Section, DOPT for Hindi Translation.
(Murali Bhavaraju)
Deputy Secretary to the Government of India
Tel. No.011-23094542
Annexure-I
Note on issue of granting a notional increment for pensionary benefits in pursuance of the judgment dated 15.09.2017 of Hon’ble High Court of Madras in W.P. No.15732 of 2017 in the case of P. Ayyamperumal Vs Union of India & Ors.
Hon’ble High Court of Madras, vide Order dated 15.09.2017, allowed the W.P. No. 15732 of 2017 filed by Shri P.Ayyamperumal relying upon its earlier judgment dated 20.09.2012 in W.P. No. 8440 of 2011 M. Balasubramaniam Vs State of Tamil Nadu. The said case referred by Hon’ble High Court in the said judgement is related to the Fundamental Rules of Tamil Nadu Government whereas the case of petitioner Shri P.Ayyamperumal relates to Central Government Rules. As per the provisions under the Tamil Nadu Fundamental Rule 26(a), the annual increments of the Govt. Servants are regulated in four quarters viz. 1st January, 1st April, 1st July and 1st October. For the Central Government, the increment accrues annually on 1st July only (6th CPC scenario) [now 1st July and 1st January in 7th CPC scenario]. Hence, argument of petitioner is devoid of merits.
2. In light of the relevant provisions of the Fundamental Rules like 9 (21), 9(6), 17(1), 22, 26(a) and 56(a), as also the provisions of CCS (RP) Rules, 2008, a person appointed as a Government servant is entitled to pay, and is also entitled to draw the annual increment as long as such Government servant discharges duties of the post. However, such Government servant may not be entitled to draw the pay and allowances attached to the post as soon as he ceases to discharge those duties. In other words, as per F.R. 17 read with F.Rs. 24 and 26, annual increment is given to a Government servant to enable him to discharge duty and draw pay and allowances attached to the post. If such Government servant ceases to discharge duties by any reason say, by reason of attainment of age of superannuation, he will not be entitled to draw pay and allowances. Such an employee would not be entitled to any increment if it falls due after the date of retirement, be it on the next day of retirement or sometime thereafter. An employee must satisfy not only the condition of becoming entitled for increment, but also should continue to be on duty as a Government servant on the due date {1st July/ 1st January) to avail the increment.
3. Further, in a similar matter, Hon’ble High Court of Andhra Pradesh at Hyderabad, in the year 2005, in the C. Subbarao case, has, inter alia, observed as under:
“In support of the above observations, the Division Bench also placed reliance on Banerjee case (supra). We are afraid, the Division Bench was not correct in coming to the conclusion that being a reward for unblemished past service, Government servant retiring on the last day of the month would also be entitled for increment even after such increment is due after retirement. We have already made reference to all Rules governing the situation. There is no warrant to come to such conclusion. Increment is given (See Article 43 of CS Regulations) as a periodical rise to a Government employee for the good behavior in the service. Such increment is possible only when the appointment is “Progressive Appointment” and it is not a universal rule. Further, as per Rule 14 of the Pension Rules, a person is entitled for pa y, increment and other allowances only when he is entitled to receive pay from out of Consolidated Fund of India and continues to be in Government service. A person who retires on the last working day would not be entitled for any increment falling due on the next day and payable next day thereafter (See Article 151 of CS Regulations}, because he would not answer the tests in these Rules. Reliance placed on Banerjee case (supra) is also in our considered opinion not correct because as observed by us, Banerjee case (supra) does not deal with increment, but deals with enhancement of DA by the Central Government to pensioners. Therefore, we are not able to accept the view taken by the Division Bench. We accordingly, overrule the judgment in Malakondalah case (supra).”
4. In addition, subsequent to the judgment of Hon’ble High Court of Madras in the P. Ayyamperumal case, Hon’ble CAT Madras Bench vide its Orders dated 19.03.2019 in O.A.No.310/ 00309/ 2019 and O.A. No.310/ 00312/ 2019 and Order dated 27.03.2019 in 0.A. No.310/ 00026/ 2019 has also dismissed similar requests related with notional increment for pensionary benefits.
F.No.5/5/2019-CS.l(U)
Government of India
Ministry Personnel, P.G. and Pensions
(Department of Personnel & Training)
Khan Market, Lok Nayak Bhavan.
New Delhi, dated 3rd February, 2021.
OFFICE MEMORANDUM
Subject: Incumbency position of CSS officers posted in various outstation offices – providing data thereof – reg.
The CS.I Division of DoPT is in the process of conducting an exercise to ascertain the actual number of CSS officers in all grades who have been posted by their respective Ministries/Departments at their outstation offices. All the cadre units are, therefore, requested to confirm the details of officers of CSS in all grades along with the names of the incumbents manning the posts under their control at outstation locations. The details may be provided in the format given below by email to [email protected] by 04.02.2021, positively.
Name of Ministry/Department :
Grade
Number of Outstation Post(s)
Name of the Organization and Place/ Location where the post is/are operated
Name of the incumbent(s) posted at the outstation office
Date since posted
Director
Deputy Secretary
Under Secretary
.
Section Officer
Assistant Section Officer
Total
(Amit Ghosal)
Under Secretary to the Government of India
To
All Ministries/Departments of Govt. of India
(through website of DoPT)
2. From the EPF Organisation, Ministry of Labour and Employment, Government of India, New Delhi No. INV11/1/2020 –INV/2025, dated: 04.01.2021.
3. From the Director of Pension, Chennai Lr: Roc.No.06/2020/G, dated: 5.01.2020.
-oOo-
ORDER:
The Government direct that the rate of interest on the deposits and balances in the account of each member of the Tamil Nadu Government Industrial Employees Contributory Provident Fund for the financial year 2019-2020 shall be 8.50% (Eight point fifty per cent).
The Central Board of Secondary Education (CBSE) released the datesheet of classes 10 and 12 examinations today. The exams is scheduled to be held from May 4 to June 10, Education Minister Ramesh Pokhriyal Nishank said earlier. The datesheet is available now at cbse.nic.in
Inclusion of sports disciplines Tennis Ball Cricket is added in the list for recruitment of sportsperson to any Group ‘C’ post – F. No. 14034/1/2013-Estt(D) dated 29.01.2021
F. No. 14034/1/2013-Estt(D) Government of India Ministry of Personnel Public Grievances & Pensions Department of Personnel & Training *****
North Block, New Delhi Dated: 29.01.2021
OFFICE MEMORANDUM
Sub:- Inclusion of sports disciplines in the list of games for recruitment of meritorious sports persons to any post in Group ‘C’ in Ministries/ Department of Government of India – regarding.
The undersigned is directed to refer to this Department’s OM of even number dated 01.09.2020 and to say that a proposal has been received from Department of Sports for inclusion of one more discipline in the list of sports disciplines for recruitment of sportsperson to any Group ‘C’ post in Ministries/ Departments of Government of India.
2. It has now been decided to accept the recommendation of Department of Sports. Accordingly, in partial modification of this Department’s OM of even number dated 01.09.2020, one more discipline namely “Tennis Ball Cricket” is added at Sr. No. 64 in the list of sports disciplines for recruitment of sportsperson to any Group ‘C’ post in Ministries/ Departments of Government of India. Further, the sports discipline namely “Cycling polo” mentioned at Sr. No.16 in the aforesaid list is to be read as “Cycle polo”.
3. AU other conditions relating to eligibility, appointment, seniority etc. laid down in the OM dated 03.10.2013 and other related OMs, as amended from time to time, shall remain unaltered.
(Pradeep Kumar) Under Secretary to Govt. of India Telephone No. 23040339
Dearness Relief payable for the period February 2021 to July 2021 to surviving pre 1.1.1986 retirees
Indian Banks’ Association
HR & INDUSTRIAL RELATIONS
No.CIR/HR&IR/D/G2/2020-21/9590
February 1, 2021
Designated Officers of all Nationalised Banks and State Bank of India
Dear Sir/Madam.
Dearness Relief payable for the period February 2021 to July 2021 to surviving pre 1.1.1986 retirees of banks (b) surviving spouses of pre 1.1.86 Retirees who are in receipt of Ex-gratia
As per the directive contained in the Government of India, Ministry of Finance Department of Economic Affairs (Banking Division) letter F.No.11/2/2012-IR dated 17.12.2013, the Dearness Relief payable to surviving pre 1.1.1986 retirees of banks for the period February 2021 to July 2021 on Ex-gratia will be as under :
Applicable CPI Average
Amount of Ex-gratia per month
Rate of Dearness Relief
Amount of Dearness Relief per month
Total Ex-gratia
amount including
Dearness Relief
per month
Dearness Relief to Bank Pensioners from February 2021 to July 2021 – IBA Order
Indian Banks’ Association
HR & INDUSTRIAL RELATIONS
No.CIR/HR&IRJD/G2/2020-21/9589
February 1, 2021
Designated Officers of all Member Banks
which are parties to the Bipartite Settlement on Pension
Dear Sir/ Madam ,
Dearness Relief payable to Pensioners for the period February 2021 to July 2021
The confirmed All India Average Consumer Price Index Numbers for Industrial Workers (Base 1960= 100) for the quarter ended December 2020 are as follows:-
October 2020 – 7855.76
November 2020 – 7882.06
December 2020 – 7809.74
In terms of Regulation 37 of Bank Employees’ Pension Regulations, 1995 Dearness Relief is payable to pensioners at rates specified in Appendix II to the Regulations.
Pending amendments to Pension Regulations, Banks may pay on ad hoc basis, the Dearness Relief payable to pensioners for the period February 2021 to July 2021 as per Annexure.
Dearness Relief to pensioners who retired on or after 1st day of January,1986, but before the 1st day of November,1992(Workmen)/1st July, 1993 (Officers)
BASIC PENSION
Dearness relief for the months
February 2021 to July 2021
Average Index
Slabs
1812
7849
(i)
Upto Rs.1250
1214.04 per cent
(ii)
Rs.1251 to Rs.2000
Rs. 15175.50 plus 996.60 percent of basic pension in excess of Rs.1250.00
(iii)
Rs.2001 to Rs.2130
Rs. 22650.00 plus 597.96 percent of basic pension in excess of Rs.2000.00
(iv)
Above Rs.2130
Rs. 23427.34 plus 308.04 percent of basic pension in excess of Rs.2130.00
PART- II
Dearness Relief to pensioners who retired on or after 1st day of November,1992 (Workmen)/1st July, 1993 (Officers)
BASIC PENSION
Dearness relief for the months February 2021 to July 2021 Average Index
Slabs 1675 7849
(i)
Upto Rs. 2400
586.25 per cent
(ii)
Rs.2401 to Rs.3850
Rs. 14070.00 plus 485.75 percent of basic pension in excess of Rs.2400.00
(iii)
Rs.3851 to Rs.4100
Rs.21113.37 plus 284.75 percent of basic pension in excess of Rs.3850.00
(iv)
Above Rs.4100
Rs. 21825.24 plus 150.75 percent of basic pension in excess of Rs.4100.00
PART- III
Dearness Relief to pensioners who retired on or after 1st day of Apri 1,1998
BASIC PENSION
Dearness relief for the months February 2021 to July 2021 Average Index
Slabs 1541 7849
(i)
Upto Rs. 3500
369.84 per cent
(ii)
Rs.3551 to Rs.5650
Rs. 13129.32 plus 308.20 of basic pension in excess of Rs.3550.00
(iii)
Rs.5651 to Rs.6010
Rs. 19601.52 plus 184.75 percent of basic pension in excess of Rs.5650.00
(iv)
Above Rs.601O
Rs. 20267.23 plus 92.46 percent of basic pension in excess of Rs. 6010.00
PART- IV
Dearness Relief to pensioners who retired on or after 1st day of November, 2002
Average Index (CPI) for quarter ended December 2020 – 7849
No. of Slabs – 1390
Rate of dearness relief on pension for the months February 2021 to July 2021 250.20 % of basic pension
(ignore decimals from 3rd place onwards)
PART- V
Dearness Relief to pensioners who retired on or after 1st day of November, 2007.
Average Index (CPI) for quarter ended December 2020 – 7849
No. of Slabs – 125390
Rate of dearness relief on pension for the months 187.95 % of basic February 2021 to July 2021 pension
(ignore decimals from 3rd place onwards)
PART- VI
Dearness Relief to pensioners who retired on or after 1st day of November, 2012.
Average Index (CPI) for quarter ended December 2020 – 7849
No. of Slabs – 852
Rate of dearness relief on pension for the months February 2021 to July 2021 85.20 % of basic pension
(ignore decimals from 3rd place onwards)
PART- VII
Dearness Relief to pensioners who retired on or after 1st day of November, 2017
Average Index (CPI) for quarter ended December 2020 – 7849
No. of Slabs – 374
Rate of dearness relief on pension for the months February 2021 to July 2021 26.18 % of basic pension
DA for Workmen and Officer Employees in banks from Feb to April 2021 – IBA Circular
Indian Banks’ Association
HR & Industrial Relations
No.CIR/HR&IR/76/D/2020-2 1/9587
February 1, 2021
All Members of the Association
(Designated Officers)
Dear Sir/ Madam,
Dearness Allowance for Workmen and Officer Employees in banks for the months of February, March & April 2021 under X BPS/ Joint Note dated 11.11.2020
The confirmed All India Average Consumer Price Index Numbers for Industrial Workers (Base 1960=100) for the quarter ended December 2020 are as follows:-
October 2020 – 7855.76
November 2020 – 7882.06
December 2020 – 7809.74
The average CPI of the above is 7849.19 and accordingly the number of DA slabs are 374 (7849 — 6352= 1497/4= 374 Slabs) The last quarterly Payment of DA was at 341 Slabs. Hence, there is an increase in DA slabs of 33 i.e. 374 Slabs for payment of DA for the quarter February, March & April 2021.
In terms of clause 7 of the 11th Bipartite Settlement dated 11.11.2020 and clause 3 of the Joint Note dated 11.11.2020, the rate of Dearness Allowance payable to Workmen and Officer employees for the months of February, March & April 2021. shall be 26.18 % of ‘pay’. While arriving at dearness allowance payable, decimals from third place may please be ignored.
Tamil Nadu GPF Interest Rate from Jan to March 2021
Government of Tamil Nadu
2021
FINANCE [Allowances] DEPARTMENT G.O.Ms.No.30 G.O.Ms.No.30, Dated , Dated , Dated 22nd Jan 2021. (sarvari, Thai-09 , Thiruvalluvar Aandu 2052)
ABSTRACT
Provident Fund – General Provident Fund (Tamil Nadu) – Rate of interest for the financial year 2020-2021 – With effect from 01.01.2021 to 31.03.2021 – Orders – Issued.
In the Government Order first to third read above, orders were issued regarding fixation of the rate of interest on the accumulation at the credit of the subscribers of G.P.F.(TN) during the financial year 2020-2021 as detailed below:
Sl.No
Quarter
Period
Rate of Interest
1
I
01-04-2020 to 30-06-2020
7.1%
2
II
01-07-2020 to 30-09-2020
7.1%
3
III
01-10-2020 to 31-12-2020
7.1%
2. The Government of India, in its resolution fourth read above, announced that during the year 2020-2021, accumulation at the credit of subscribers to the General Provident Fund and other similar funds shall carry interest at the rate of 7.1% (Seven point one percent) with effect from 1st January, 2021 to 31st March, 2021.
3. The Government now directs that the rate of interest on the accumulation at the credit of the subscribers to General Provident Fund (Tamil Nadu) shall carry interest at the rate of 7.1% (Seven point one percent) with effect from 1st January, 2021 to 31st March, 2021.
4. The rate of interest on belated final payment of Provident Fund accumulation remaining unpaid for more than three months of its becoming payable shall be at the same rates as ordered in para-3 above.
(BY ORDER OF THE GOVERNOR)
S. KRISHANAN
ADDITIONALCHIEF SECRETARY TO GOVERNMENT
The Union Minister for Finance & Corporate Affairs, Smt Nirmala Sitharaman presented the Union Budget 2021-22 in Parliament today, which is the first budget of this new decade and also a digital one in the backdrop of unprecedented COVID-19 crisis. Laying a vision for AatmaNirbhar Bharat, she said this is an expression of 130 crore Indians who have full confidence in their capabilities and skills. She said that Budget proposals will further strengthen the Sankalp of Nation First, Doubling Farmer’s Income, Strong Infrastructure, Healthy India, Good Governance, Opportunities for youth, Education for All, Women Empowerment, and Inclusive Development among others. Additionally, also on the path to fast-implementation are the 13 promises of Budget 2015-16-which were to materialize during the AmrutMahotsav of 2022, on the 75th year of our Independence. They too resonate with this vision of AatmaNirbharta, she added.
The Budget proposals for 2021-22 rest on 6 pillars.
Health and Wellbeing
Physical & Financial Capital, and Infrastructure
Inclusive Development for Aspirational India
Reinvigorating Human Capital
Innovation and R&D
Minimum Government and Maximum Governance
Health and Wellbeing
There is substantial increase in investment in Health Infrastructure and the Budget outlay for Health and Wellbeing is Rs 2,23,846 crore in BE 2021-22 as against this year’s BE of Rs 94,452 crore, an increase of 137 percentage.
The Finance Minister announced that a new centrally sponsored scheme, PM AatmaNirbhar Swasth Bharat Yojana, will be launched with an outlay of about Rs 64, 180 crore over 6 years. This will develop capacities of primary, secondary, and tertiary care Health Systems, strengthen existing national institutions, and create new institutions, to cater to detection and cure of new and emerging diseases. This will be in addition to the National Health Mission. The main interventions under the scheme are:
Support for 17,788 rural and 11,024 urban Health and Wellness Centers
Setting up integrated public health labs in all districts and 3382 block public health units in 11 states;
Establishing critical care hospital blocks in 602 districts and 12 central institutions;
Strengthening of the National Centre for Disease Control (NCDC), its 5 regional branches and 20 metropolitan health surveillance units;
Expansion of the Integrated Health Information Portal to all States/UTs to connect all public health labs;
Operationalisation of 17 new Public Health Units and strengthening of 33 existing Public Health Units at Points of Entry, that is at 32 Airports, 11 Seaports and 7 land crossings;
Setting up of 15 Health Emergency Operation Centers and 2 mobile hospitals; and
Setting up of a national institution for One Health, a Regional Research Platform for WHO South East Asia Region, 9 Bio-Safety Level III laboratories and 4 regional National Institutes for Virology.
Vaccines
Provision of Rs 35,000 crore made for Covid-19 vaccine in BE 2021-22.
The Pneumococcal Vaccine, a Made in India product, presently limited to only 5 states, will be rolled out across the country aimed at averting 50,000 child deaths annually.
Nutrition
To strengthen nutritional content, delivery, outreach, and outcome, Government will merge the Supplementary Nutrition Programme and the PoshanAbhiyan and launch the Mission Poshan 2.0. Government will adopt an intensified strategy to improve nutritional outcomes across 112 Aspirational Districts.
Universal Coverage of Water Supply and Swachch Bharat Mission
The Finance Minister announced that the JalJeevan Mission (Urban), will be launched for universal water supply in all 4,378 Urban Local Bodies with 2.86 crore household tap connections, as well as liquid waste management in 500 AMRUT cities. It will be implemented over 5 years, with an outlay of Rs. 2,87,000 crore. Moreover, the Urban Swachh Bharat Mission will be implemented with a total financial allocation of Rs 1,41,678 crore over a period of 5 years from 2021-2026. Also to tackle the burgeoning problem of air pollution, government proposed to provide an amount of Rs. 2,217 crore for 42 urban centres with a million-plus population in this budget. A voluntary vehicle scrapping policy to phase out old and unfit vehicles was also announced. Fitness tests have been proposed in automated fitness centres after 20 years in case of personal vehicles, and after 15 years in case of commercial vehicles
Finance Minister said that for a USD 5 trillion economy, our manufacturing sector has to grow in double digits on a sustained basis. Our manufacturing companies need to become an integral part of global supply chains, possess core competence and cutting-edge technology. To achieve all of the above, PLI schemes to create manufacturing global champions for an AatmaNirbhar Bharat have been announced for 13 sectors. For this, the government has committed nearly Rs.1.97 lakh crore in the next 5 years starting FY 2021-22. This initiative will help bring scale and size in key sectors, create and nurture global champions and provide jobs to our youth.
Textiles
Similarly, to enable the textile industry to become globally competitive, attract large investments and boost employment generation, a scheme of Mega Investment Textiles Parks (MITRA) will be launched in addition to the PLI scheme. This will create world class infrastructure with plug and play facilities to enable create global champions in exports. 7 Textile Parks will be established over 3 years.
Infrastructure
The National Infrastructure Pipeline (NIP) which the Finance Minister announced in December 2019 is the first-of-its-kind, whole-of-government exercise ever undertaken. The NIP was launched with 6835 projects; the project pipeline has now expanded to 7,400 projects. Around 217 projects worth Rs 1.10 lakh crore under some key infrastructure Ministries have been completed.
Infrastructure financing – Development Financial Institution (DFI)
Dwelling on the infrastructure sector, Smt Sitharaman said that infrastructure needs long term debt financing. A professionally managed Development Financial Institution is necessary to act as a provider, enabler and catalyst for infrastructure financing. Accordingly, a Bill to set up a DFI will be introduced. Government has provided a sum of Rs 20,000 crore to capitalise this institution and the ambition is to have a lending portfolio of at least Rs 5 lakh crore for this DFI in three years time.
Asset Monetisation
Monetizing operating public infrastructure assets is a very important financing option for new infrastructure construction. A “National Monetization Pipeline” of potential Brownfield infrastructure assets will be launched. An Asset Monetization dashboard will also be created for tracking the progress and to provide visibility to investors. Some important measures in the direction of monetisation are:
National Highways Authority of India and PGCIL each have sponsored one InvIT that will attract international and domestic institutional investors. Five operational roads with an estimated enterprise value of Rs 5,000 crore are being transferred to the NHAIInvIT. Similarily, transmission assets of a value of Rs 7,000 crore will be transferred to the PGCIL InvIT.
Railways will monetize Dedicated Freight Corridor assets for operations and maintenance, after commissioning.
The next lot of Airports will be monetised for operations and management concession.
Other core infrastructure assets that will be rolled out under the Asset Monetization Programme are: (i) NHAI Operational Toll Roads (ii) Transmission Assets of PGCIL (iii) Oil and Gas Pipelines of GAIL, IOCL and HPCL (iv) AAI Airports in Tier II and III cities, (v) Other Railway Infrastructure Assets (vi) Warehousing Assets of CPSEs such as Central Warehousing Corporation and NAFED among others and (vii) Sports Stadiums.
Roads and Highways Infrastructure
Finance Minister announced that more than 13,000 km length of roads, at a cost of Rs 3.3 lakh crore, has already been awarded under the Rs. 5.35 lakh crore Bharatmala Pariyojana project of which 3,800 kms have been constructed. By March 2022, Government would be awarding another 8,500 kms and complete an additional 11,000 kms of national highway corridors. To further augment road infrastructure, more economic corridors are also being planned. She also provided an enhanced outlay of Rs. 1,18,101 lakh crore for Ministry of Road Transport and Highways, of which Rs.1,08,230 crore is for capital, the highest ever.
Railway Infrastructure
Indian Railways have prepared a National Rail Plan for India – 2030. The Plan is to create a ‘future ready’ Railway system by 2030. Bringing down the logistic costs for our industry is at the core of our strategy to enable ‘Make in India’. It is expected that Western Dedicated Freight Corridor (DFC) and Eastern DFC will be commissioned by June 2022.
For Passenger convenience and safety the following measures are proposed:
Introduction of aesthetically designed Vista Dome LHB coach on tourist routes to give a better travel experience to passengers.
The safety measures undertaken in the past few years have borne results. To further strengthen this effort, high density network and highly utilized network routes of Indian railways will be provided with an indigenously developed automatic train protection system that eliminates train collision due to human error.
Budget also provided a record sum of Rs. 1,10,055 crore, for Railways of which Rs. 1,07,100 crore is for capital expenditure.
Urban Infrastructure
Government will work towards raising the share of public transport in urban areas through expansion of metro rail network and augmentation of city bus service. A new scheme will be launched at a cost of Rs. 18,000 crore to support augmentation of public bus transport services.
A total of 702 km of conventional metro is operational and another 1,016 km of metro and RRTS is under construction in 27 cities. Two new technologies i.e., ‘MetroLite’ and ‘MetroNeo’ will be deployed to provide metro rail systems at much lesser cost with same experience, convenience and safety in Tier-2 cities and peripheral areas of Tier-1 cities.
Power Infrastructure
The past 6 years have seen a number of reforms and achievements in the power sector with the addition of 139 Giga Watts of installed capacity, connecting an additional 2.8 crore households and addition of 1.41 lakh circuit km of transmission lines.
Expressing a serious concern over the viability of Distribution Companies, the Finance Minister proposed to launch a revamped reforms-based result-linked power distribution sector scheme with an outlay of Rs. 3,05,984 crore over 5 years. The scheme will provide assistance to DISCOMS for Infrastructure creation including pre-paid smart metering and feeder separation, upgradation of systems, etc., tied to financial improvements.
Ports, Shipping, Waterways
Major Ports will be moving from managing their operational services on their own to a model where a private partner will manage it for them. For the purpose the budget proposes to offer more than Rs. 2,000 crore by Major Ports on Public Private Partnership mode in FY21-22.
A scheme to promote flagging of merchant ships in India will be launched by providing subsidy support to Indian shipping companies in global tenders floated by Ministries and CPSEs. An amount of Rs. 1624 crore will be provided over 5 years. This initiative will enable greater training and employment opportunities for Indian seafarers besides enhancing Indian companies share in global shipping.
Petroleum & Natural Gas
Smt Sitharaman said that the government has kept fuel supplies running across the country without interruption during the COVID-19 lockdown period. Taking note of the crucial nature of this sector in people’s lives, the following key initiatives are being announced:
Ujjwala Scheme which has benefited 8 crore households will be extended to cover 1 crore more beneficiaries.
Government will add 100 more districts in next 3 years to the City Gas Distribution network.
A gas pipeline project will be taken up in Union Territory of Jammu & Kashmir.
An independent Gas Transport System Operator will be set up for facilitation and coordination of booking of common carrier capacity in all-natural gas pipelines on a non-discriminatory open access basis.
Financial Capital
The Finance Minister proposed to consolidate the provisions of SEBI Act, 1992, Depositories Act, 1996, Securities Contracts (Regulation) Act, 1956 and Government Securities Act, 2007 into a rationalized single Securities Markets Code. The Government would support the development of a world class Fin-Tech hub at the GIFT-IFSC.
Increasing FDI in Insurance Sector
She also proposed to amend the Insurance Act, 1938 to increase the permissible FDI limit from 49% to 74% and allow foreign ownership and control with safeguards. Under the new structure, the majority of Directors on the Board and key management persons would be resident Indians, with at least 50% of Directors being Independent Directors, and specified percentage of profits being retained as general reserve.
Disinvestment and Strategic Sale
In spite of COVID-19, Government has kept working towards strategic disinvestment. The Finance Minister said a number of transactions namely BPCL, Air India, Shipping Corporation of India, Container Corporation of India, IDBI Bank, BEML, Pawan Hans, NeelachalIspat Nigam limited among others would be completed in 2021-22. Other than IDBI Bank, Government propose to take up the privatization of two Public Sector Banks and one General Insurance company in the year 2021-22.
In 2021-22, Government would also bring the IPO of LIC for which the requisite amendments will be made in this Session itself.
In a very important announcement, the Finance Minister said that in the AtmaNirbhar Package, she had announced to come out with a policy of strategic disinvestment of public sector enterprises and said that the Government has approved the said policy. The policy provides a clear roadmap for disinvestment in all non-strategic and strategic sectors. Government has kept four areas that are strategic where bare minimum CPSEs will be maintained and rest privatized. In the non-strategic sectors, CPSEs will be privatised, otherwise shall be closed. She said that to fast forward the disinvestment policy, NITI Aayog will work out on the next list of Central Public Sector companies that would be taken up for strategic disinvestment. Government has estimated Rs. 1,75,000 crore as receipts from disinvestment in BE 2020-21 .
Under the pillar of Inclusive Development for Aspirational India, the Finance Minister announced to cover Agriculture and Allied sectors, farmers’ welfare and rural India, migrant workers and labour, and financial inclusion.
Agriculture
Dwelling on agriculture, she said that the Government is committed to the welfare of farmers. The MSP regime has undergone a sea change to assure price that is at least 1.5 times the cost of production across all commodities. The procurement has also continued to increase at a steady pace. This has resulted in increase in payment to farmers substantially.
In case of wheat, the total amount paid to farmers in 2013-2014 was Rs. 33,874 crore. In 2019-2020 it was Rs. 62,802 crore, and even better, in 2020-2021, this amount, paid to farmers, was Rs. 75,060 crore. The number of wheat growing farmers that were benefitted increased in 2020-21 to 43.36 lakhs as compared to 35.57 lakhs in 2019-20.
For paddy, the amount paid in 2013-14 was Rs. 63,928 crore. In 2019-2020, this increased to Rs.1,41,930 crore. Even better, in 2020-2021, this is further estimated to increase to Rs. 172,752 crore. The farmers benefitted increased from 1.24 crore in 2019-20 to 1.54 crore in 2020-21.
In the same vein, in case of pulses, the amount paid in 2013-2014 was ` 236 crore. In 2019-20 it increased to Rs. 8,285 crore. Now, in 2020-2021, it is at Rs.10,530 crore, a more than 40 times increase from 2013-14.
The receipts to cotton farmers have seen a stupendous increase from Rs. 90 crore in 2013-14 to Rs. 25,974 crore (as on 27th January 2021).
Early this year, Honourable Prime Minister had launched SWAMITVA Scheme. Under this, a record of rights is being given to property owners in villages. Up till now, about 1.80 lakh property-owners in 1,241 villages have been provided cards and the Finance Minister proposed during FY21-22 to extend this to cover all states/UTs.
To provide adequate credit to our farmers, Government has enhanced the agricultural credit target to Rs. 16.5 lakh crore in FY22. Similarly, the allocation to the Rural Infrastructure Development Fund increased from Rs. 30,000 crore to Rs. 40,000 crore. The Micro Irrigation Fund, with a corpus of Rs.5,000 crore has been created under NABARD will be doubled.
In an important announcement to boost value addition in agriculture and allied products and their exports, the scope of ‘Operation Green Scheme’ that is presently applicable to tomatoes, onions, and potatoes, will be enlarged to include 22 perishable products.
Around 1.68 crore farmers are registered and Rs. 1.14 lakh crore of trade value has been carried out through e-NAMs. Keeping in view the transparency and competitiveness that e-NAM has brought into the agricultural market, 1,000 more mandis will be integrated with e-NAM. The Agriculture Infrastructure Funds would be made available to APMCs for augmenting their infrastructure facilities.
Fisheries
Finance Minister proposed substantial investments in the development of modern fishing harbours and fish landing centres. To start with, 5 major fishing harbours – Kochi, Chennai, Visakhapatnam, Paradip, and Petuaghat – will be developed as hubs of economic activity.
Migrant Workers and Labourers
Government has launched the One Nation One Ration Card scheme through which beneficiaries can claim their rations anywhere in the country. One Nation One Ration Card plan is under implementation by 32 states and UTs, reaching about 69 crore beneficiaries – that’s a total of 86% beneficiaries covered. The remaining 4 states and UTs will be integrated in the next few months.
Government proposes to conclude a process that began 20 years ago, with the implementation of the 4 labour codes. For the first time globally, social security benefits will extend to gig and platform workers. Minimum wages will apply to all categories of workers, and they will all be covered by the Employees State Insurance Corporation. Women will be allowed to work in all categories and also in the night-shifts with adequate protection. At the same time, compliance burden on employers will be reduced with single registration and licensing, and online returns.
Financial Inclusion
To further facilitate credit flow under the scheme of Stand Up India for SCs, STs, and women, the Finance Minister proposed to reduce the margin money requirement from 25% to 15%, and to also include loans for activities allied to agriculture. Moreover, a number of steps were taken to support the MSME sector and in this Budget, Government has provided Rs. 15,700 crore to this sector – more than double of this year’s BE.
4. Reinvigorating Human Capital
The Finance Minister said that the National Education Policy (NEP) announced recently has had good reception, while adding that more than 15,000 schools will be qualitatively strengthened to include all components of the National Education Policy. She also announced that 100 new Sainik Schools will be set up in partnership with NGOs/private schools/states. She also proposed to set up a Higher Education Commission of India, as an umbrella body having 4 separate vehicles for standard-setting, accreditation, regulation, and funding. For accessible higher education in Ladakh, Government proposed to set up a Central University in Leh.
Scheduled Castes and Scheduled Tribes Welfare
Government has set a target of establishing 750 Eklavya model residential schools in tribal areas with increase in unit cost of each such school from Rs. 20 crore to Rs. 38 crore, and for hilly and difficult areas, to Rs. 48 crore. Similarly, under the revamped Post Matric Scholarship Scheme for the welfare of Scheduled Castes, the Central Assistance was enhanced and allocated Rs. 35,219 crore for 6 years till 2025-2026, to benefit 4 crore SC students.
Skilling
An initiative is underway, in partnership with the United Arab Emirates (UAE), to benchmark skill qualifications, assessment, and certification, accompanied by the deployment of certified workforce. The Government also has a collaborative Training Inter Training Programme (TITP) between India and Japan to facilitate transfer of Japanese industrial and vocational skills, technique, and knowledge and the same would be taken forward with many more countries.
5. Innovation and R&D
The Finance Minister said thatin her Budget Speech of July 2019, She had announced the National Research Foundation and added that the NRF outlay will be of Rs. 50,000 crore, over 5 years. It will ensure that the overall research ecosystem of the country is strengthened with focus on identified national-priority thrust areas.
Government will undertake a new initiative – National Language Translation Mission (NTLM). This will enable the wealth of governance-and-policy related knowledge on the Internet being made available in major Indian languages.
The New Space India Limited (NSIL), a PSU under the Department of Space will execute the PSLV-CS51 launch, carrying the Amazonia Satellite from Brazil, along with a few smaller Indian satellites.
As part of the Gaganyaan mission activities, four Indian astronauts are being trained on Generic Space Flight aspects, in Russia. The first unmanned launch is slated for December 2021.
6. Minimum Government, Maximum Governance
Dwelling on the last of the six pillars of the Budget, the Finance Minister proposed to take a number of steps to bring reforms in Tribunals in the last few years for speedy delivery of justice and proposes to take further measures to rationalised the functioning of Tribunals. Government has introduced the National Commission for Allied Healthcare Professionals Bill in Parliament, with a view to ensure transparent and efficient regulation of the 56 allied healthcare professions. She also announced that the forthcoming Census could be the first digital census in the history of India and for this monumental and milestone-marking task, Rs. 3,768 crore allocated in the year 2021-2022.
On Fiscal position, she underlined that the pandemic’s impact on the economy resulted in a weak revenue inflow. Once the health situation stabilised, and the lockdown was being slowly lifted, Government spending was ramped up so as to revive domestic demand. As a result, against an original BE expenditure of Rs. 30.42 lakh crore for 2020-2021, RE estimates are Rs. 34.50 lakh crore and quality of expenditure was maintained. The capital expenditure, estimated in RE is Rs. 4.39 lakh crore in 2020-2021 as against Rs. 4.12 lakh crore in BE 2020-21.
The Finance Minister said fiscal deficit in RE 2020-21 is pegged at 9.5% of GDP and it has been funded through Government borrowings, multilateral borrowings, Small Saving Funds and short term borrowings. She added that the Government would need another Rs 80,000 crore for which it would be approaching the markets in these 2 months. The fiscal deficit in BE 2021-2022 is estimated to be 6.8% of GDP. The gross borrowing from the market for the next year would be around 12 lakh crore.
Smt Sitharaman announced that the Government plan to continue the path of fiscal consolidation, and intend to reach a fiscal deficit level below 4.5% of GDP by 2025-2026 with a fairly steady decline over the period. “We hope to achieve the consolidation by first, increasing the buoyancy of tax revenue through improved compliance, and secondly, by increased receipts from monetisation of assets, including Public Sector Enterprises and land”, she said.
In accordance with the views of the 15th Finance Commission, Government is allowing a normal ceiling of net borrowing for the states at 4% of GSDP for the year 2021-2022.
The FRBM Act mandates fiscal deficit of 3% of GDP to be achieved by 31st March 2020-2021. The effect of this year’s unforeseen and unprecedented circumstances has necessitated the submission of a deviation statement under Sections 4 (5) and 7 (3) (b) of the FRBM Act which the Finance Minister laid on the Table of the House as part of the FRBM Documents.
On 9th December 2020, the 15th Finance Commission submitted its final report, covering the period 2021-2026 to the Rashtrapatiji. The Government has laid the Commission’s report, along with the explanatory memorandum retaining the vertical shares of the states at 41%. On the Commission’s recommendation, the Budget provided Rs. 1,18,452 crore as revenue deficit grant to 17 states in 2021-22.
PART-B
In Part B of the Budget Speech, the Union Minister Smt. Nirmala Sitharaman seeks to further simplify the Tax Administration, Litigation Management and ease the compliance of Direct Tax Administration. The indirect proposal focuses on custom duty rationalization as well as rationalization of procedures and easing of compliance.
DIRECT TAX PROPOSALS
The Finance Minister provided relief to senior citizens in filing of income tax returns, reduced time limit for income tax proceedings announced setting up of the Dispute Resolution Committee, faceless ITAT, relaxation to NRIs, increase in exemption limit from audit and relief for dividend income. She also announced steps to attract foreign investment into infrastructure, relief to affordable housing and rental housing, tax incentives to IFSC, relief to small charitable trusts, and steps for incentivizing Start-ups in the country.
Smt.Nirmala Sitharaman, in her Budget speech, said that post-pandemic, a new world order seems to be emerging and India will have a leading role therein. She said in this scenario, our tax system has to be transparent, efficient and should promote investment and employment in the country. The Minister said that at the same time, it should put minimum burden on our tax payers. She said that a series of reforms had been introduced by the Government for the benefit of tax payers and economy, including slashing of corporate tax rate, abolition of dividend distribution tax, and increasing of rebate for small tax payers. In the year 2020, the income tax return filers saw a dramatic increase to 6.48 crore from 3.31 crore in 2014.
The Budget seeks to reduce compliance burden on senior citizens who are of 75 years of age and above. Such senior citizens having only pension and interest income will be exempted from filing their income tax return. The paying Bank will deduct the necessary tax on their income. The Budget proposes to notify rules for removing the hardship of non-Resident Indians returning to India on the issue of their accrued incomes in their foreign retirement account. The Budget proposes to make dividend payment to REIT/InvIT exempt from TDS. For Foreign Portfolio Investors, the Budget proposes deduction of tax on dividend income at lower treaty rate. The Budget provides that advanced tax liability on dividend income shall arise only after the declaration or payment of dividend. The Minister said that this was being done as the amount of dividend income cannot be estimated correctly by the shareholders for paying advance tax.
The Finance Minister proposed to extend the eligibility period for claim of additional deduction for interest of Rs. 1.5 lakh paid for loan taken for purchase of an affordable house to 31st March, 2022. In order to increase the supply of affordable houses, she also announced extension of eligibility period for claiming tax holiday for affordable housing projects by one more year to 31st March, 2022. For promoting supply of affordable rental housing for the migrant workers, the Minister announced a new tax exemption for the notified affordable rental housing projects.
In order to incentivize start ups in the country, Smt. Sitharaman announced extension in the eligibility for claiming tax holiday for start ups by one more year till 31st March, 2022. In order to incentivize funding of start ups, she proposed extending the Capital Gains exemption for investment in start ups by one more year till 31st March, 2022.
The Finance Minister said that delay in deposit of the contribution of employees towards various welfare funds results in permanent loss of interest/income for the employees. In order to ensure timely deposit of employee’s contribution to these funds by the employers, she announced that late deposit of employee’s contribution shall never be allowed as deduction to the employer.
In order to reduce compliance burden, the Budget provides reduction in the time-limit for reopening of income tax proceeding for three years from the present six years. In serious tax evasion cases, where there is evidence of concealment of income of Rs. 50 lakh or more in a year, the assessment can be reopened upto 10 years but only after the approval of the Principal Chief Commissioner.
Stating the resolve of the Government to reduce litigation in the taxation system, the Finance Minister said that the Direct Tax Vivad se Vishwas Scheme announced by the Government has been received well. Until 30th January, 2021, over one lakh ten thousand tax payers have opted to settle tax dispute of over Rs. 85 thousand crores under the Scheme. To further reduce litigation of small tax payers, she proposed to constitute a Dispute Resolution Committee. Anyone with a taxable income upto Rs. 50 lakh and disputed income upto Rs. 10 lakh shall be eligible to approach the Committee. She also announced setting up of National Faceless Income Tax Appellate Tibunal Centre.
To incentivize digital transaction and to reduce the compliance burden of the person who is carrying almost all of the transactions digitally, the Budget proposes to increase the limit for tax audit for persons who are undertaking 95 per cent of their transaction digitally from Rs. 5 Crore to Rs. 10 Crore.
To attract foreign investment into infrastructure sector, the Budget proposes to relax certain conditions relating to prohibition on private funding, restriction on commercial activities and direct investment in infrastructure. In order to allow funding of infrastructure by issue of zero coupon bonds, the Budget proposes to make notified infrastructure debt funds eligible to raise funds by issuing tax efficient zero coupon bonds.
In order to promote International Financial Services Centre (IFSC) in GIFT City, the Budget proposes more tax incentives.
The Budget proposes that details of capital gains from listed securities, dividend income and interest from banks, post office etc. will also be pre-filled to ease filing of returns. Details of salary income, tax payment, TDS etc already come pre-filled in returns.
In order to reduce compliance burden on the small charitable trust running educational institutions and hospitals, the Budget proposes to increase the limit on annual receipts for these trusts from present Rs.1 Crore to Rs. 5 Crore for non-applicability of various compliances.
INDIRECT TAX PROPOSALS
On the issue of Indirect Tax proposals, the Minister said that record GST collections have been made in the last few months. She said several measures have been taken to further simplify the GST. The capacity of GSTN system has been announced. Deep analytics and artificial intelligence have been deployed to identity tax evaders and fake billers, launching special drives against them. The Finance Minister assured the House that every possible measure shall be taken to smoothen the GST further and remove anomalies such as the inverted duty structure.
With respect to the custom duty policy, the Finance Minister said that it has the twin objectives of promoting domestic manufacturing and helping India get on to global value change and export better. She said that the thrust now has to be on easy access to raw materials and exports of value added products. In this regard, she proposed to review 400 old exemptions in the custom duty structure this year. She announced that extensive consultation will be conducted and from 1st October, 2021, a revised custom duty structure free of distortions will be put in place. She also proposed that any new custom duty exemptions henceforth will have validity upto to the 31st March following 2 years of the date of its issue.
The Finance Minister announced withdrawal of a few exemptions on parts of chargers and sub-parts of mobile phones further some parts of mobiles will move from “NIL” rate to a moderate 2.5 per cent. She also announced reducing custom duty uniformly to 7.5 per cent on semis, flat, and long products of non-alloy and stainless steel. She also announced exempting duty on steel scrap for a period upto 31st March 2022.
Stressing on the need to rationalize duty on raw material inputs to man-made textile, the Finance Minister announced bringing nylon chain on par with polyester and other man-made fibers. Announcing uniform deduction of the BCD rates on Caprolactam, nylon chips and nylon fiber and yarn to 5 per cent, the Minister said this will help the textile industry, MSMEs and exports too. She also announced calibration of customs duty rate on chemical to encourage domestic value addition and to remove inversions. The Minister also announced rationalization of custom duty on gold and silver.
The Finance Minister said that a phased manufacturing plan for solar cells and solar panels will be notified to build up domestic capacity. She announced raising duty on solar inverter from 5 per cent to 20 percent and on solar lanterns from 5 per cent to 15 per cent.
The Finance Minister in her Budget speech said that there is immense potential in manufacturing heavy capital equipment domestically and the rate structure will be comprehensively reviewed in due course. However, she announced revision in duty rates on certain items immediately including tunnel boring machine and certain auto parts.
The Budget proposes certain changes to benefit MSMEs which include increasing duty on steel screws, plastic builder wares and prawn feed. It also provide for rationalizing exemption on import of duty free items as an incentives to exporters of garments leather and handicraft items. It also provides withdrawing exemption on imports of certain kind of leather and raising custom duty on finished synthetic gem stones.
To benefit farmers, the Finance Minister announced raising custom duty on cotton, raw silk and silk yarn. She also announced withdrawing end-use based concessions on denatured ethyl alcohol. The Minister also proposed an Agriculture Infrastructure and Development Cess on a small number of items. She said “while applying the cess, we have taken care not to put additional burden on consumers on most items.
Regarding rationalization of procedures and easing of compliance, the Finance Minister proposed certain changes in the provisions relating to ADD and CVD levies. She also said that to complete customs investigation, definite time-lines are being prescribed. The Minister said that the Turant Custom Initiative rolled out in 2020 has helped in putting a check of misuse of FTAs.
