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If GST has failed, revert to the old tax system: Uddhav Thackeray

“Don’t destabilise the non-BJP governments. If these things continue, it will lead to an anarchic situation in the country,” Thackeray warned.

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Uddhav Thackeray

Mumbai : In a significant statement, Shiv Sena President and Maharashtra Chief Minister Uddhav Thackeray on Sunday said that if the system of GST has failed, then the Centre should honestly admit it and revert to the old system of taxation in the country.

Addressing the party’s annual Dassehra Rally online with only 50 people present in an auditorium near Shivaji Park, Thackeray said that Maharashtra has not been refunded its Goods & Service Tax (GST) dues of Rs.38,000 crore which has created huge financial crises for the state in the Corona pandemic times.

“From all this, it appears that the GST system is proving a hoaxa It is time to review the present form of GST as the states are not beneittinga If it is not working, the Prime Minister should honestly admit it and bring back the old system of taxation,” Thackeray said.

Referring to similar problems faced by other states, Thackeray said the country is not of one party and urged Chief Ministers of states to join together, meet the PM to discuss and sort out the issues.

At the same time he lashed out at the Bharatiya Janata Party for promising to distribute free Corona vaccines to the people of Bihar if itsAalliance is voted back to power in its poll manifesto.

“On one hand you don’t give us our legitimate GST dues and on the other, you promise free vaccines to people Bihara Where will the money come from? So what about other people of Indiaa Why this blatant discrimination? Is the rest of the country a Pakistan,” Thackeray said.

In another veiled punch on Governor Bhagat Singh Koshyari without taking any names, Thackeray questioned the credentials of those who sought to enquire about his ‘Hindutva’, referring to the recent letter-war.

“Our ‘Hindutva’ is far older and different from your ‘Hindutva’. The late Balasaheb Thackeray spoke about it when others were even scared to utter the word. I have pounced once, if needed will pounc again,” Thackeray warned.

Taking a swipe at the state Opposition BJP leaders and those wearing ‘black caps’, Thackeray advised them to listen carefully to RSS Chief Mohan Bhagwat’s Dassehra Rally speech.

“Our ‘Hindutva’ is not limited to deities, temples or pujas or ringing bells or banging thaalis. Our ‘Hindutva’ itself is our Nationalism. You enacted a cow protection law in Maharashtra, why not in Goa,” he asked.

“Shiv Sena had demanded to make Mohan Bhagwat the President, but they have joined hands with Nitish Kumar’s party in Bihar which wanted no truck with anybody connected with RSS. Don’t play political games of ‘iski topi, uske sar’ in the name of ‘Hindutva’,” Thackeray said.

Training guns on the BJP and Leader of Opposition Devendra Fadnavist for their hurry in toppling the Shiv Sena-Nationalist Congress Party-Congress Maha Vikas Aghadi government, Thackeray took another jibe, saying despite many “Tarikh pe Tarikh, my government has survived and is stable”.

“From day one when I took over as CM, some people are dreaming of throwing me out. I repeat what I said then – This is an open challenge. If you have the guts, then try to dislodge my government,” Thackeray said.

The CM expressed concern over the “strange goings-on” in the country which is in the grip of the Corona pandemic, the economic crises and other serious issues, saying, “but the BJP is only interested in playing temple politics in lockdown and busy felling state governments during the pandemic”.

“Don’t destabilise the non-BJP governments. If these things continue, it will lead to an anarchic situation in the country,” Thackeray warned.

Without naming actress Kangana Ranaut, the CM said, “Those who don’t even proper food in their state come here, make money and then become ‘namak-haram’ (traitors) by comparing Mumbai with Pakistan Occupied Kashmir and defaming the state, its leaders and the police department.”

“Temples will be opened at the right time. I also have full faith in the Mumbai Police, they are among the best in the world. Anybody attempting to separate Mumbai from Maharashtra would be reduced to dust. Had you (BJP) had spared so much time for the people of the country as you do for your party activities, it would be better for all,” Thackeray declared.

The Covid-compliant mini-Dassehra Rally was held in the Swatantraveer Savarkar auditorium – an unprecedented development since the inaugural rally in 1966 – and the first by Thackeray as the CM, with the presence of top Sena leaders, ministers and elected representatives, while it was telecast and webcast live to the audiences across the state.

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Inflationary woes: RBI retains rates, maintains accommodative stance

Reacting to the improved GDP growth forecast, the S&P BSE Sensex crossed the 45,000 mark for the first time ever.

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Shaktikanta Das

Mumbai, Dec 4 : The Reserve Bank of India (RBI) on Friday retained its key short-term lending rates to subdue the unabatedly high inflation rate.

However, the Monetary Policy Committee (MPC) of the central bank maintained the growth-oriented accommodative stance, thus opening up possibilities for more future rate cuts.

Resultantly, MPC voted to maintain the repo rate — or short-term lending rate for commercial banks, at 4 per cent.

Likewise, the reverse repo rate was kept unchanged at 3.35 per cent, and the marginal standing facility (MSF) rate and the ‘Bank Rate’ at 4.25 per cent.

It was widely expected that the Reserve Bank’s MPC will hold rates as recent data showed that retail inflation has been at an elevated level during June.

As per recent data, the Consumer Price Index (CPI), which gauges the retail price inflation, spiked in October to 7.61 per cent from 7.27 per cent in September.

Though not-comparable, India had recorded a retail price inflation of over 3 per cent in the corresponding period of previous year.

The RBI maintains a medium-term CPI inflation target of 4 per cent. The target is set within a band of +/- 2 per cent.

In an online address detailing the MPC’s decision, RBI Governor Shaktikanta Das said: “At the end of its deliberations, the MPC voted unanimously to leave the policy repo rate unchanged at 4 per cent.”

“It also decided to continue with the accommodative stance of monetary policy as long as necessary – at least through the current financial year and into the next year – to revive growth on a durable basis and mitigate the impact of Covid-19, while ensuring that inflation remains within the target going forward.”

According to Das, the MPC was of the view that inflation is likely to remain elevated, with some relief in the winter months from prices of perishables and bumper kharif arrivals.

“This constrains monetary policy at the current juncture from using the space available to act in support of growth. At the same time, the signs of recovery are far from being broad-based and are dependent on sustained policy support,”.

“A small window is available for proactive supply management strategies to break the inflation spiral being fuelled by supply chain disruptions, excessive margins and indirect taxes. Further efforts are necessary to mitigate supply-side driven inflation pressures. The MPC will monitor closely all threats to price stability to anchor broader macroeconomic and financial stability.”

Besides, Das said that India’s economy has witnessed a faster than anticipated recovery and its expected Real GDP growth rate will be at (-) 7.5 per cent in FY21.

He cited that several high frequency indicators have pointed to growth in both rural and urban areas.

“Consumers remain optimistic about the outlook and business sentiment of manufacturing firms is gradually improving. Fiscal stimulus is increasingly moving beyond being supportive of consumption and liquidity to supporting growth-generating investment,” he said.

“On the other hand, private investment is still slack and capacity utilisation has not fully recovered. While exports are on an uneven recovery, the prospects have brightened with the progress on the vaccines.”

“Taking these factors into consideration, real GDP growth is projected at (-) 7.5 per cent in 2020-21, (+) 0.1 per cent in Q3:2020- 21 and (+) 0.7 per cent in Q4:2020-21; and 21.9 per cent to 6.5 per cent in H1:2021- 22, with risks broadly balanced.”

Furthermore, Das elaborated that RBI will take additional measures to enhance liquidity support to targeted sectors having linkages to other sectors, deepen financial markets and conserve capital among banks, NBFCs through regulatory initiatives amongst other steps

Later on during a press interaction, Das, while answering to a question replied that RBI has not ‘junked’ inflation targeting via monetary policy mechanism.

He admitted that past inflation expectations have not materialised.

Citing extraordinarily situation, he said: “Our expectations on inflation, which we had over the last two months obviously that has not materialised. And we have to keep in mind that we are dealing with an extraordinary situation. A once in hundred years kind of event, and the kind of impact it has produced on the economy as well as on human lives, not just in India but across countries. It’s huge. So, we have to respond to this particular situation.”

Corroborating the assessment, RBI’s Deputy Governor Michael D. Patra said:

“You will see the trajectory of inflation completely changing. But what we have given you is the baseline with things, standing as they are today.”

“But, if you read into the guidance that Governor is giving. He sees this window as a chance for supply side management which is the prime instrument to use at this juncture, to produce a different trajectory of inflation.”

On the RBI’s internal working group’s recommendations on banking guidelines, he said that the final decision on the same has not been taken.

Reflecting back on the volatile calender year 2020, the governor explained that liquidity inducing measures have attained their desired objectives.

In addition, the Reserve Bank has decided to bring the 26 stressed sectors identified by the K.V. Kamath Committee under the ambit of on-tap targeted long-term repo operation (TLTRO).

The measure has been adopted under its regulatory and development policies which are independent of the MPC.

So far five sectors were eligible for the scheme as announced on October 21, 2020.

The policy review, the last one for the calendar year 2020, garnered positive response from the markets and India Inc.

Reacting to the improved GDP growth forecast, the S&P BSE Sensex crossed the 45,000 mark for the first time ever.

It touched a new intraday record high of 45,033.19 points.

The NSE Nifty50, also touched a fresh record high of 13,250.30 points.

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63 moons to challenge SEBI order on STP Gate Services

63 moons said it has always had the utmost faith in the judiciary and will be taking appropriate legal action in the higher judiciary forum.

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SEBI

New Delhi: 63 moons technologies on Friday said it would challenge the SEBI order, which rejected its renewal application for providing STP Gate Services, and take appropriate legal action in the higher judiciary forum.

Expressing disbelief at the SEBI order rejecting the approval for providing STP Gate Services on the basis of ‘Fit & Proper’ order passed by FMC seven years ago, the company said the Fit and Proper order passed against 63 moons in 2014 specifically deals with barring persons or entities from holding an equity stake in any exchange platform and has no bearing on providing technology services.

In an order passed by the SEBI last night, the application for renewal (for the period June 30, 2016 to June 29, 2019) by 63 moons technologies, earlier known as Financial Technologies India Limited, to act as STP Service provider under the SEBI (STP Centralised Hub and STP Service Providers) Guidelines, 2004 has been rejected. It held that 63 Moons has been providing the STP services to brokers, custodians, and fund houses without the approval of SEBI.

63 moons said it has been almost seven years since the order of Fit and Proper has been passed and has already been challenged by 63 moons in the court of law. “The matter is, therefore, sub judice.”

The latest order of SEBI is with regards to STP gate service only and it has nothing to do with any other technology services by the group, it added.

Notably, since 2003 till date, 63 moons technology has been the pioneer and market leader as well as most stable and credible technology service provider for all segments of the market. While it holds more than 75 per cent market share in all segments including its service offerings to MCX and MSEI, it has the distinction of having 97 per cent market share in STP gate.

In the backdrop of NSE withdrawing its trading platform ‘NOW’, 63 moons’ ODIN remains the best solution available across multiple asset classes in the market. In this condition, the company said, the intention of SEBI’s present order is unexplainable.

SEBI coming out with such an order after over seven years, especially when the issue of Fit & Proper is still sub-judice will be disturbing the smooth functioning of the market. The timing and intent of the SEBI order is totally in contradiction to the purpose for which SEBI exists for fair and transparent regulation and growth and stability of the market.

In a statement, the company said the management of 63 moons is completely professional, having eminent administrators, judges, bankers among others on its board. “It is being run with a high standard of governance as envisaged in the rule book. The allegation of undue influence of the promoter is unfounded and is to be dismissed,” it added.

63 moons said it has always had the utmost faith in the judiciary and will be taking appropriate legal action in the higher judiciary forum.

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RBI to come up with guidelines for dividend distribution by NBFCs

RBI has decided to carry out consultation with stakeholders before finalising the revised regulatory framework.

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Reserve Bank of India RBI

Mumbai: The Reserve Bank of India (RBI) has decided to come out with guidelines for dividend distribution by NBFCs.

Unlike banks, currently there are no guidelines in place with regard to distribution of dividend by NBFCs.

RBI Governor Shaktikanta Das on Friday announced that keeping in view the increasing significance of NBFCs in the financial system and their interlinkages with different segments, it has been decided to formulate guidelines on dividend distribution by NBFCs.

Different categories of NBFCs would be allowed to declare dividend as per a matrix of parameters, subject to a set of generic conditions.

A draft circular in this regard will be issued shortly for public comments.

He further said that the contribution of NBFCs as a supplemental channel of credit intermediation alongside banks is well recognised.

Regulatory regime governing the NBFC sector is built on the principle of proportionality such that adequate operational flexibility is available to the sector through calibrated regulatory measures.

However, there are rapid developments in the last few years, which have led to significant increase in size and interconnectedness of the NBFC sector.

“There is, therefore, a need to review the regulatory framework in line with the changing risk profile of NBFCs. It is felt that a scale-based regulatory approach linked to the systemic risk contribution of NBFCs could be the way forward,” said the RBI’s statement on developmental and regulatory policies.

RBI has decided to carry out consultation with stakeholders before finalising the revised regulatory framework.

A discussion paper in this regard will be issued before January 15, 2021 for public comments.

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