Banking, Financial and Economic Awareness of 09 January 2020

1. FIEO appeals to government for fully exempting earned leave encashment from income tax

• Federation of Indian Export Organisations (FIEO) has appealed to the government that earned leave encashment for non-government employees should be fully exempted from income tax.
• Unlike non-government employees, employees of central and state governments are fully exempted from income tax on money received from encashment of earned leave as per section 10 (10AA (i)) of the Income Tax Act.
• While earned leave encashment by non-government employees is currently taxable before retirement, earned leave encashment by them up to Rs 3 lakh at the time of retirement is exempted from tax.
• Exemption up to Rs 3 lakh is provided under Section 10 (10AA (ii)) of the Income Tax Act.
• Federation of Indian Export Organisations (FIEO):
  • It was formed in 1965 under the Ministry of Commerce and Industry.
  • It is registered under Societies Registration Act XXI of 1860.

2. Resignation and appointment of IBM's India and South Asia MD and Asia Pacific (APAC) region CEO and Chairperson 

• After resignation by Karan Bajwa as IBM's India and South Asia MD and by Harriet Green as IBM's Asia Pacific (APAC) region CEO and Chairperson, IBM has announced the names of Sandip Patel and Brenda Harvey as a replacement to Karan Bajwa and Harriet Green.
• Before joining IBM in 2016, Bajwa was MD, Microsoft India. His replacement Sandip Patel was the global general manager of IBM for the insurance industry.
• Brenda Harvey will be designated as GM, Asia Pacific. Currently, she is GM, US Public Market.
• International Business Machines (IBM):
  • IBM is also known as Big Blue.
  • Headquarters: Armonk, New York
  • Chairman, President and CEO: Ginni Rometty

3. Ordinance to amend MMDR Act 1957 and CMSP Act 2015 approved

• Union Cabinet has approved an ordinance to amend Mines and Minerals (Development and Regulation) Act 1957 and Coal Mines (Special Provisions) Act, 2015 (CMSP Act).
• Amended MMDR act 1957 will allow automatic and continuous transfer of Environment and Forest clearance to the new bidders. Currently, the transfer takes up to two years.
• Due to the expiring of non-captive mining leases on March 31, 2020, there may be an iron-ore production deficit of 16 million tonnes in India.
• The amendment in CMSP Act 2015 will remove end-use restrictions for taking part in the auction of coal blocks and lower imports of coal.
• By prohibiting bidders without plants for coal consumption from taking part in the bid for mines, end-use restrictions were causing decline in the number of coal blocks bidders.
• Through the ordinance, Composite Prospective and Mining licenses for coal mining will also be started in India.
• End-use restrictions were placed by the CMSP Act 2015 after the Supreme Court had cancelled leases of 204 blocks in 2014.
• In 2019, 235 million tonnes of coal was imported by India.

4. ₹5,559-cr capital grant for establishing North East Natural Gas Pipeline Grid approved

• Cabinet Committee on Economic Affairs (CCEA) has approved ₹5,559-cr capital grant in the form of Viability Gap Funding (VGF) to Indradhanush Gas Grid Ltd for establishing North East Natural Gas Pipeline Grid.
• ₹5,559-cr Viability Gap Funding (VGF) is 60 % of the estimated project cost of ₹9,265 crore.
• North-East Natural Gas Pipeline Grid:
  • It will be a 1,656-km pipeline that will connect the capitals of eight states of the northeastern region.
  • Indradhanush Gas Grid Limited (IGGL) was authorized by Petroleum and Natural Gas Regulatory Board (PNGRB) for the development of the North-East Natural Gas Pipeline Grid.
• Indradhanush Gas Grid Limited (IGGL) is a joint venture company of following five Central Public Sector Enterprises (CPSEs)
  • Indian Oil Corporation Limited (IOCL)
  • Oil and Natural Gas Corporation (ONGC)
  • Gas Authority of India Limited (GAIL)
  • Oil India Limited (OIL)
  • Numaligarh Refinery Limited (NRL) 

Multiple Choice Questions (MCQs)

1. Which of the section of Income Tax Act exempts employees of central and state governments from income tax on encashment of earned leave?

1. Section 54
2. Section 10
3. Section 44
4. Section 24
5. Section 80

2. Karan Bajwa who recently resigned as IBM's India and South Asia MD will be replaced by

1. Harriet Green
2. Sandip Patel
3. Brenda Harvey
4. Ginni Rometty
5. None of the above

3. How much coal was imported by India in 2019?

1. 235 million tonne
2. 187 million tonne
3. 324 million tonne
4. 125 million tonne
5. 94 million tonne

4. Which of the following was authorized by Petroleum and Natural Gas Regulatory Board (PNGRB) for the development of North-East Natural Gas Pipeline Grid?

1. Indian Oil Corporation Limited (IOCL)
2. Oil and Natural Gas Corporation (ONGC)
3. Gas Authority of India Limited (GAIL)
4. Numaligarh Refinery Limited (NRL)
5. None of the above

Correct Answers:

1. B
2. B
3. A
4. E

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