Banking Awareness of 1, 2 and 3 October 2023

Topic: Taxation

1. The Finance Ministry has notified final rules outlining valuation methods for investors.

• These rules outline valuation methods for non-resident and resident investors under the new angel tax mechanism in the Finance Act 2023.
• In addition to the rules mentioned in the draft issued in May, the notification introduces an additional sub-clause.
• This sub-clause addresses Compulsorily Convertible Preference Shares (CCPS).
• In addition to discounted cash flow method for resident investors, new rules prescribe five methods for non-resident investors.
• The valuation of CCPS can also be based on the fair market value of unquoted equity shares.
• Angel tax is the income tax at the rate of 30.6%. It is levied when an unlisted company issues shares to an investor at a price higher than their fair market value.
• It was earlier imposed only on investments made by a resident investor.
• In Budget 2023-24, government proposed to extend angel tax to non-resident investors from April 1, 2024.

Topic: Banking/Financial/Govt Schemes

2. Government has kept interest rate on most small saving schemes unchanged for Q3 of this financial year.

• It has increased the return on five-year recurring deposits by 20 basis points from 6.5% to 6.7% for Q3 (October to December 2023 quarter).
• The interest rate on the National Savings Certificate has been kept unchanged at 7.7% from October 1 to December 31, 2023.
• The interest rate for Sukanya Samriddhi scheme has also been kept unchanged at current rate of 8%.
• The interest rate on the senior citizen savings scheme and Kisan Vikas Patra (KVP) is 8.2% and 7.5%, respectively.
• The aim of the government is to issue securities worth more than ₹4.71-lakh crore against small savings this fiscal.
• The small savings schemes basket comprises 12 instruments, which include the National Saving Certificate (NSC), Public Provident Fund (PPF), Kisan Vikas Patra (KVP) and Sukanya Samridihi Scheme.

Topic: Indian Economy/Financial Market

3. Fiscal deficit reached 36% of Budget Estimate during April-August period of fiscal year 2023-24.

• Fiscal deficit stood at 33% during corresponding period of last fiscal.
• The fiscal deficit stood at ₹6.42-lakh crore as of August-end, according to the data released by the Controller General of Accounts (CGA).
• During April-August period, the net tax revenue was ₹8.03-lakh crore. It was 34.5% of Budget Estimate for the current fiscal.
• Of the total expenditure, ₹12.97-lakh crore was on the revenue account and ₹3.73-lakh crore towards the capital account.
• Central government has fixed a target of ₹17.87-lakh crore. This is 5.9% of GDP.
• Fiscal deficit is difference between income and expenditure.
• Fiscal deficit indicates the total borrowings that are needed by the government.

Topic: Reports and Indices

4. PMI manufacturing declined to five month low level of 57.5 in September.

• It was higher than its long-run average (53.9). PMI manufacturing stood at 58.6 in August.
• The decline in manufacturing PMI in September means the manufacturing sector slowed down.
• However, job creation showed a good sign. Manufacturing is the biggest job creator.
• Manufacturing PMI is prepared based on a survey among purchasing managers of 400 companies engaged in manufacturing activities.

Topic: Appointments

5. P R Seshadri has been appointed as MD and CEO of South Indian Bank.

• His appointment has become effective from 1 October.
• He has succeeded Murali Ramakrishnan. Murali Ramakrishnan served from October 1, 2020 to September 30, 2023.
• Before joining South Indian Bank, Seshadri was associated with the Karur Vysya Bank Ltd in similar role.
• South Indian Bank is a private sector bank. It is headquartered in Thrissur, Kerala. It was founded in 1929.

Topic: Corporates/Companies

6. Phygital debt resolution service has been launched Mobicule Technologies.

• mCollect, a phygital debt resolution service has been launched by Mumbai –based Mobicule Technologies.
• It has been launched for lenders. It blends digital outreach and call centre services for debt collection and resolution.
• The company said mCollect platform will help reduce bounce rates.
• It will track user behavior with the use of “digital + AI + physical calls”.
• It is expected that the platform will manage 25 lakh borrower accounts of lenders (Banks and non-banking finance companies) by March-end 2024.
• Siddharth Agarwal is the Founder and Managing Director of Mobicule Technologies.

Topic: Appointments

7. Nitin Gupta’s tenure as CBDT chairman has been extended till 2024.

• The government has decided to extend the tenure of Nitin Gupta as chairman of the Central Board of Direct Taxes (CBDT), till June 30, 2024.
• The Appointments Committee of the Cabinet (ACC) has approved the reappointment of Nitin Gupta as the CBDT Chairman.
• He was scheduled to retire on September 30.
• He is a 1986-batch Indian Revenue Service (IRS) officer of the Income-tax department.
• As per the government notification, the service period of Nitin Gupta has been extended on a ‘Contract Basis’.
• Central Board of Direct Taxes (CBDT):
  • It is a statutory body under the Central Revenue Act, 1963. It is the administrative body of the Income Tax Department.
  • It deals with matters related to levy and collection of direct taxes like personal income tax, corporate tax, etc.
  • CBDT is headed by the Chairman and comprises six members. Its headquarters are in New Delhi.

Topic: Taxation

8. 28% GST on Online Gaming and Casinos becomes effective from 1 October.

• The government has imposed 28 percent GST on betting, online gaming, horse racing, and lottery.
• The decision to levy 28 percent GST was taken in the 51st GST Council meeting.
• Online gaming companies have started charging 28% GST on the full value of bets from 1 October.
• In the case of casinos, the tax would be imposed on the face value of the chips.
• Tax will be imposed on the full value of the bets placed by bookmaker/totalisator in the case of Horse Racing.
• As per the amendment in the IGST act, offshore online gaming platforms have to register themselves in India and pay 28% tax per domestic law.
• As per the notification, the supply of online money gaming will be treated as imported goods so it empowers tax officials to levy IGST.
• The Integrated Goods and Services Tax (Amendment) Bill, 2023, and the Central Goods and Services Tax (Amendment) Bill, 2023 were passed to introduce a 28 per cent GST for online gaming, casinos, and horse racing.
• The notification has also prescribed norms for valuation.
• Several online gaming companies and casino operators, including Dream 11, have received GST show cause notices for alleged short payment of taxes.

Topic: Appointments

9. Lt. Gen Raghu Srinivasan assumed charge as 28^th Director General Border Roads (DGBR) on 30 September 2023.

• He took over the charge after the superannuation of Lt Gen Rajeev Chaudhry.
• He was holding the appointment of Commandant, College of Military Engineering, Pune.
• Lt Gen Raghu Srinivasan was commissioned into the Corps of Engineers in 1987.
• He has taken part in Operation Vijay, Operation Rakshak and Operation Parakram.
• Director General Border Roads is the executive head of the Border Roads Organisation (BRO).   

Topic: Banking/Financial/Govt Schemes

10. Uttar Pradesh has achieved 100% ODF Plus coverage under Swachh Bharat Mission (Grameen) Phase II.

• All 95,767 villages in UP achieved ODF Plus status under Phase II of the mission.
• These villages have declared themselves ODF+ with Solid/Liquid Waste Management Systems.
• More than 80,000 villages have achieved ODF Plus Status in the last 9 months.
• Out of the 95,767 ODF Plus villages, 81,744 villages are ODF Plus Aspiring villages with arrangements for Solid Waste Management or Liquid Waste Management.
• 10,217 villages are ODF Plus Rising villages with arrangements for both Solid Waste Management and Liquid Waste Management.
• 3,806 villages are ODF Plus Model villages.
• An ODF Plus village is one that has sustained its Open Defecation Free (ODF) status along with implementing either solid or liquid waste management systems.
• 4.4 lakh (75%) villages across India have declared themselves ODF Plus.
• UP’s achievement has come amidst the nationwide ‘Swachhata Hi Seva’ campaign.
• Swachhata Hi Seva is celebrated annually from 15th September to 2nd October under Swachh Bharat Mission (Grameen).
• An ODF Plus Model village is one that sustains its ODF status. It has arrangements for both Solid Waste Management and Liquid Waste Management.
• Cleanliness is visible in an ODF Plus Model village. There is minimal litter, minimal stagnant wastewater, and no plastic waste dumped in public places.
• An ODF Plus Model village displays ODF Plus Information, Education & Communication (IEC) messages.

Read Banking Awareness PDF - 1, 2 and 3 October 2023