Banking Awareness of 18 and 19 October 2024

Topic: Taxation

1. According to the most recent time series statistics from the Central Board of Direct Taxes (CBDT), there are more than 10 crore income taxpayers in India.

• Additionally, data showed that tax buoyancy had crossed 2 once more following a one-year lapse.
• Data indicate that tax buoyancy is at its second-highest level in the previous 14 years.
• According to data, there were 10.41 crore taxpayers at the conclusion of the 2023–24 assessment year, up from around 5.26 crore at the end of the 2013–14 assessment year. This is a 98% growth.
• According to data, there were approximately 3.31 crore returns filed in FY2013–14.
• This number increased to 8.09 crore in FY24, indicating a 144% increase.
• A "taxpayer" is defined by the Income Tax (IT) Department as an individual who has submitted an income return for the applicable Assessment Year (AY).
• The IT Department also defines a "taxpayer" as someone whose tax has been deducted at source in the relevant financial year, but the taxpayer has not filed the return of income.
• Tax Buoyancy:
  • The responsiveness of tax collections to increases in nominal GDP and to arbitrary adjustments in tax laws is known as tax buoyancy.
  • It is calculated by dividing the percentage change in gross tax income by the percentage change in GDP from the prior year.

Topic: RBI

2. Business restrictions on four non-banking finance companies (NBFCs) has been imposed by RBI.

• These NBFCs are Asirvad Micro Finance Ltd, Arohan Financial Services Ltd, DMI Finance Pvt Ltd and Navi Finserv Ltd.
• RBI asked the NBFCs to cease and desist from sanction and disbursal of loans.
• RBI’s action against these NBFCs is effective from close of business of October 21.
• The action is based on material supervisory concerns observed in the pricing policy of these companies in terms of their WALR and the interest spread charged over their cost of funds
• Weighted Average Lending Rate (WALR) and the interest spread charged over their cost of funds was found to be excessive in case of these NBFCs.
• The pricing policy of these companies was not in conformity with the provisions laid down under Fair Practices Code issued by the RBI.
• Asirvad Micro Finance Ltd and Arohan Financial Services Ltd are classified as mirofinance institutions.
• DMI Finance Pvt Ltd and Navi Finserv Ltd are classified as investment & credit companies.

Topic: Reports and Indices

3. Nomura’s NICAI index declined to 3% in September.

• Aggregate NICAI growth slowed to 4.1 per cent y-o-y in August from 6.5 per cent in June and 7.0 per cent in March.
• Preliminary reading for September is further lower at 3.0 per cent.
• The Nomura India Coincident Activity Index (NICAI) is a composite index. It covers consumption, investment and the external sector.
• Nomura India Composite Leading Index (NICLI) has a one-quarter lead on non-agricultural GDP growth.
• The NICLI is just below the 100 threshold and moderating sequentially.
• This points to a rising risk of a cyclical growth slowdown in future.
• “We see rising downside risks to our GDP growth forecasts, for both FY25 (6.7%) and FY26 (6.8%)” Nomura said.

Topic: Taxation

4. RAAR has held that GST on corporate guarantees from foreign group companies is payable only one-time, not periodically.

• The problem of paying the whole tax up front for the period of the guarantee is presented by ruling of Rajasthan's Authority for Advance Ruling (RAAR), according to the experts.
• According to AAR, section 13(3) of the GST regulations is crucial for determining the supply time.
• The parent company's corporate guarantee to its subsidiary for a bank loan will be subject to 18% GST, as suggested by the GST Council on October 7, 2023.
• The GST liability would be ₹18 lakh if the corporate guarantee was ₹100 crore.
• The tax risk connected with previous transactions will be preserved because the change would be prospective and will not affect transactions completed before October 26, 2023.

Topic: Appointments

5. Srinivas got additional charge of CEO of public procurement portal GeM.

• L Satya Srinivas, Additional Secretary in the Department of Commerce, has been given the additional charge of CEO of public procurement portal GeM by the government.
• P K Singh, the last CEO of Government e-Marketplace (GeM), has been appointed Secretary in the Ministry of Renewable Energy.
• Hence, Srinivas has been given additional charge.
• On August 9, 2016, the GeM portal was launched for online purchases of goods and services by all central government ministries and departments.

Topic: Banking/Financial/Govt Schemes

6. “SAMARTH” (Scheme for Capacity Building in Textiles Sector) extended by the government till March 2026.

• SAMARTH is a demand-driven and employment-oriented mass skilling programme of the Ministry of Textiles.
• SAMARTH scheme has been extended for another two years (FY 2024-25 and 2025-26) with a budget of Rs 495 crore to train 3 lakh people in textile-related skills.
• The objective of the scheme is to encourage and support the industry in employment generation in the organised textile and related sectors.
• It covers the entire value chain of textiles except spinning and weaving.
• Training programs and curriculum have been rationalised to meet emerging technology and market needs.
• The scheme is implemented through Implementation Partners (IPs).
• This includes textile industries and industry associations, Central and State Government agencies, and sectoral organisations of the Ministry of Textiles such as DC & Handlooms, DC & Handicrafts, the Central Wool Development Board, and the Central Silk Board.
• Under the Samarth Scheme, the Ministry has trained 3.27 lakh candidates through implementing partners.

Topic: Banking System

7. On October 16, the first branch in Singapore inaugurated by HDFC to expand financial services.

• The Monetary Authority of Singapore (MAS) has granted a wholesale banking license to HDFC Bank effective October 15, 2024.
• This will enable the bank to offer a wider range of financial products and services to Singapore residents.
• HDFC Bank will continue to provide loan-related administrative services to NRIs in Singapore for obtaining home loans and purchasing properties in India through its new branch.
• Rakesh Singh, Group Head, International Banking, Investment Banking, Private Banking, Digital Ecosystems & BAS, HDFC Bank, inaugurated the branch.
• HDFC Bank's international operations now comprise five branches, including one each in Hong Kong, Bahrain, Dubai, Singapore and an IFSC Banking Unit (IBU) at Gujarat International Finance Tech City.
• The lender also has representative offices in Kenya, Abu Dhabi, Dubai and London.

Topic: Miscellaneous

8. A new Line of Credit for 487.60 crore rupees has been extended by India to the government of Mauritius.

• The purpose of this line of credit is to finance the replacement of a water pipeline.
• This is the first time that India has ever offered a Line of Credit denominated in rupees to finance a project in any nation through the Indian Development and Economic Assistance Scheme (IDEAS).
• The project aims to replace Mauritius's around 100 km of obsolete water pipeline.
• State Bank of India will finance the Government of India-supported Line of Credit at concessional terms.

Topic: Miscellaneous

9. The constitutional validity of Section 6A of the Citizenship Act has been upheld by the Supreme Court by a majority verdict of 4:1.

• This section is related to the grant of Indian citizenship to immigrants in Assam.
• Supreme Court held that Parliament had the legislative competence to enact the provision.
• The five-judge Constitution bench said that Assam Accord was a political solution to the problem of illegal migration.
• The five-judge Constitution bench was headed by Chief Justice DY Chandrachud.
• In 1985, the section 6A was inserted after the Assam Accord.
• It established a specific rule for Assam that declared people of Indian descent who arrived from Bangladesh before January 1, 1966, to be Indian citizens on that day.
• Additionally, the section stated that individuals of Indian descent who came into Assam between January 1, 1966, and March 25, 1971, had to register themselves.
• Only after ten years of residence did they receive their citizenship.
• Section 6A declared that anyone coming after the deadline (March 25, 1971) will be considered an illegal immigrant.

Topic: Awards and Prizes

10. Nikita Porwal from Madhya Pradesh has been crowned Femina Miss India 2024.

• After this win, Nikita will represent India in the Miss World beauty pageant (73rd Miss World pageant).
• Rekha Pandey from the Union Territory and Aayushi Dholakia from Gujarat were awarded the first and second runners-up titles, respectively.
• Femina Miss India 2024 event was held on October 16 in Mumbai. This was 60th edition of the beauty pageant.
• Last year's Femina Miss India titleholder is Nandini Gupta of Rajasthan.
• Nikita Porwal was born and raised in Ujjain. Nikitra has acted in over 60 plays.
• Femina Miss India 2024 was the 60th edition of Femina Miss India pageant.

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