Daily Current Affairs 05/March/2020
Direct Tax Vivad se Vishwas Bill (Tax Resolution Bill)
Recently, lok Sabha passed the Tax resolution bill which is also called Vivad se Vishwas bill.
Tax resolution – What is the issue?
- As per the details produced by Govt, there are as many as 4.83 lakh direct tax disputes pending in various appellate fora such as Commissioner (Appeals), Income Tax Appellate Tribunal, High Courts and Supreme Court.
- Rs. 9.5 lakh crore is locked in these direct tax disputes due to delays in resolution.
- The disputes consume considerable time & cost of both corporate and individual direct tax payers and also strain govt machinery which spend time for litigation to resolve these disputes.
What does the bill propose?
- Resolution Mechanism –
- The Bill proposes a resolution mechanism under which an appellant (either the income tax authority or the tax payer) can file a declaration to the designated authority to initiate resolution of pending direct tax disputes.
- Based on the declaration, the designated authority will determine the amount payable by the appellant against the dispute and grant a certificate, containing particulars of the amount payable, within 15 days of the receipt of the declaration.
- The appellant must pay this amount within 15 days of the receipt of the certificate and inform the designated authority of such payment. Such amount will not be refundable.
- Amount Payable – The amount payable by the appellant for resolution of disputes is determined based on whether the dispute relates to payment of tax, or payment of interest, penalty, or fee. Further, he is required to pay an additional amount if such payment is made after March 31, 2020.
- Taxpayer would be required to pay only the amount of the disputed taxes and will get complete waiver of interest and penalty provided the amount is paid by March 31.
- Implementation of direct tax code which comprehensively address direct tax payment processes.
- Focus on better tax payer services with thrust on digital transactional facilities.
- Helping organisations to trim down their non-core activities such as B2G interactions.
Telecom Sector Crisis
Recently, Govt excluded PSUs such as GAIL, OIL etc from paying AGR dues inline with SC ruling. Telecom players such as Bharati Airtel & Vodafone idea are reeling under heavy stress because of the SC ruling in Oct 2019 asking them to pay the AGR dues.
Why huge stress in Telecom Sector?
- Predatory pricing policies by Reliance Jio which is a new entrant. From more than 10 players in 2015, the number of players in the sector has reduced to 4 recently. The sector witnesses intensifies activities of merger and acquisitions after the entrance of Reliance Jio.
- SC court ruling in Oct 2019 resulting in redefining of Adjusted Gross Revenue (AGR).It ruled that AGR includes both telecom business revenue and non-telecom business revenue in contrast to claim of telecom companies that it includes only telecom business revenues. Currently the telecom players together have to pay Rs 1.48 lakh crore.
- Huge spectrum charges and additional dues such as contributions towards Universal service obligation fund (USOF).
What Is Adjusted Gross Revenue (AGR)?
AGR is the revenue of telecom companies, a percentage of which(8% currently) they have to pay as license fee to government as per the revenue sharing model introduced in 1999 in the National telecom Policy.SC recently held that AGR includes both telecom business revenues & non-telecom business revenues of Telecom companies.
Why Telecom sector crisis is detrimental to Indian economy?
- Reduction in number of players in telecom sector will result in lesser competition among them. This is detrimental to consumers and might result in increased cost for services and low quality services.
- Telecom sector is most important in Digital India programme.
- Emerging technologies such as AI, Big Data and blockchain ride mostly on telecom sector.
- Govt intervention is needed to further enhance ease of doing business in telecom sector.
- Reducing burden of spectrum charges and other fines & contributions.
- Creation of a robust telecom infrastructure.
Decriminalising Corporate Offences – Amendments to Companies Act 2013
Recently, Finance minister Nirmala Sitaraman proposed an amendment to companies Act 2013 which will be a second amendment to the act in last one year. It is a bid to decriminalise a number of offences and ease corporate social responsibility (CSR) requirements, especially for smaller companies. The priority is to remove sections which criminalise offences which may not have been intended to be malafide as per finance ministry officials.
What are the changes?
- Union Cabinet approved the proposal to amend 65 sections of the Act.
- Centre proposes to recategorise 23 offences so that they can be dealt with through an in-house adjudication framework, while five types of offences will be dealt with under different alternative frameworks
- Another seven will be omitted altogether. Most of these are procedural or technical defaults that lack the element of fraud or do not affect larger public interest.
- For 11 kinds of offences, the provision of imprisonment will be removed, limiting punishment to fines only.
- The amendment bill will also enable the listing of Indian companies on stock exchanges in foreign jurisdictions. This is expected to give Indian firms greater access to capital, a broader investor base and better valuations.
- The proposed amendments will also ensure that companies which have an obligation to spend ₹50 lakh per annum or less on Corporate Social Responsibility (CSR) are no longer required to have a CSR committee. Companies that spend more than the mandatory 2% on CSR in a particular year can carry it forward as credit for fulfilment of CSR obligations for the next few years as well.
Many of the corporate offences are not in the nature of criminal offences as they can be due to technical issues.
- Criminalising corporate offences tend to clog criminal justice system. Many of the offences can be resolved using alternate dispute resolution mechanisms.
- Trust of corporate sector is highly needed at a time when India registers low growth due to lack of private investment. Decriminalising corporate offices will enhance ease of doing business.
- Corporate sector is crucial in generating employment for the huge young demography of India. Initiatives to strengthen the trust between corporate sector & Govt are most welcome.
- While decriminalising offences, Govt must also enhance its regulatory capacity to avoid malafide.
- Digitalising government to business interactions to avoid malafide is an act in the right direction.
PAPER II India’s Foreign Policy, International Organizations, International Treaties and Forums, their structure and mandate
INDIAN POLICY ON PALESTINE-ISRAEL CONFLICT
U.N. representative from Senegal told that “the best way to test India’s commitment is the way India votes India has consistently voted in favour of those resolutions that promote the two-state solution with a Palestinian claim to East Jerusalem”.
Israel is the world’s only Jewish state, located just east of the Mediterranean Sea. Palestinians, the Arab population that hails from the land Israel now controls refer to the territory as Palestine, and want to establish a state by that name on all or part of the same land. The Israeli-Palestinian conflict is over who gets what land and how it’s controlled.
HISTORY OF CONFLICT:
The history of the Israeli-Palestinian conflict began with the establishment of the state of Israel in 1948.Jews fleeing persecution in Europe wanted to establish a national homeland in what was then an Arab- and Muslim-majority territory in the Ottoman and later British Empire. The Arabs resisted, seeing the land as rightfully theirs. An early United Nations plan to give each group part of the land failed, and Israel and the surrounding Arab nations fought several wars over the territory. Today’s lines largely reflect the outcomes of two of these wars, one waged in 1948 and another in 1967.
The 1967 war is particularly important for today’s conflict, as it left Israel in control of the West Bank and Gaza Strip, two territories home to large Palestinian populations.
Today, the West Bank is nominally controlled by the Palestinian Authority and is under Israeli occupation. This comes in the form of Israeli troops, who enforce Israeli security restrictions on Palestinian movement and activities, and Israeli “settlers,” Jews who build ever-expanding communities in the West Bank that effectively deny the land to Palestinians. Gaza is controlled by Hamas, an Islamist fundamentalist party, and is under Israeli blockade but not ground troop occupation.
INDIA’s STAND ON ISRAELI – PALESTINE RELATIONS:
Indian stand is very crystal clear.India holds a well-balanced relationship between both the nations. India supports state of Israel and its existence. At the same time India is committed to support an independent Palestinian state.
Even though India has voted against creation of state of Israel in United Nations in 1948 but India recognized Israel in 1950. India has improved its relationship with Israel in last 27 years but at the same time has maintained its commitment to cause of Palestine. India has not supported neither Palestinian terrorism nor excess use of force by Israel. India is one of the few countries which has differentiated its relationship with Israel and Palestine.P.M. Modi visited both Israel and Palestine on different occasions & he is the only world leader to do so in recent times.
INDIA’s UPCOMING ROLE IN THIS ISSUE:
To revive the peace process the UN has sent a delegation to India in an effort to get New Delhi to play a greater role in mediating between the warring parties. A delegation of the UN Committee on the Exercise of the Inalienable Rights of the Palestinian People (CEIRPP) began a two-day visit to the capital yesterday.
The delegation intends to engage India, a country with good relations to both the State of Palestine and Israel, in looking for ways how it could play a more proactive role in the settling of the question of Palestine.
APPROACHES WHICH CAN SOLVE THE ISSUE:
The primary approach to solving the conflict today is a so-called “two-state solution” that would establish Palestine as an independent state in Gaza and most of the West Bank, leaving the rest of the land to Israel. Though the two-state plan is clear in theory, the two sides are still deeply divided over how to make it work in practice.
The alternative to a two-state solution is a “one-state solution,” wherein all of the land becomes either one big Israel or one big Palestine. Most observers think this would cause more problems than it would solve, but this outcome is becoming more likely over time for political and demographic reasons.
PAPER II (B) SCIENCE & TECHNOLOGY; Environment protection for sustainable development.
ENERGY FROM WASTE – AN EFFECTIVE SOLID WASTE MANAGEMENT METHEDOLOGY
SOLID WASTE MANAGEMENT:
Solid waste management is defined as the discipline associated with control of generation, storage, collection, transport or transfer, processing and disposal of solid waste materials in a way that best addresses the range of public health, conservation, economic, aesthetic, engineering, and other environmental considerations.
In its scope, solid waste management includes planning, administrative, financial, engineering, and legal functions.
Solid waste refers to the range of garbage materials—arising from animal and human activities—that are discarded as unwanted and useless. Solid waste is generated from industrial, residential, and commercial activities in a given area, and may be handled in a variety of ways. As such, landfills are typically classified as sanitary, municipal, construction and demolition, or industrial waste sites.
Waste can be categorized based on material, such as plastic, paper, glass, metal, and organic waste. Categorization may also be based on hazard potential, including radioactive, flammable, infectious, toxic, or non-toxic wastes. Categories may also pertain to the origin of the waste, whether industrial, domestic, commercial, institutional, or construction and demolition.
WASTE TO ENERGY:
Waste-to-energy (WTE) is different from solar (or wind) as it essentially aims to reduce the colossal amount of solid wastes accumulating in cities and towns all over India. In addition to managing wastes, waste-to-energy has the added advantage of producing power which can be used to meet rapidly increasing energy requirements of urban India.
According to the Ministry of New and Renewable Energy (MNRE), there exists a potential of about 1700 MW from urban waste (1500 from MSW and 225 MW from sewage) and about 1300 MW from industrial waste. The ministry is also actively promoting the generation of energy from waste, by providing subsidies and incentives for the projects. Indian Renewable Energy Development Agency (IREDA) estimates indicate that India has so far realized only about 2% of its wasteto- energy potential. The NITI Aayog, as part of the Swachh Bharat Mission, envisages 800 megawatt from WTE plants by 2018-19, which is 10 times the capacity of all the existing WTE plants put together.
ADVANTAGES OF WASTE TO ENERGY:
Waste-to-Energy (or energy-from-waste) facilities provide a safe, technologically advanced means of waste disposal that reduces greenhouse gases, generates clean energy and recycles metal.
Waste-to-Energy (WTE) is widely recognized as a technology that can help mitigate climate change. This is because the waste combusted at a WTE facility doesn’t generate methane, as it would at a landfill; the metals that would have been sent to the landfill are recovered for recycling instead of being thrown out; and the electricity generated offsets the greenhouse gases that would otherwise have been generated from coal and natural gas plants. WTE facilities are the only form of energy generation that actually reduces greenhouse gases.
Additionally, the energy produced at waste-to-energy facilities is reliable baseload power, meaning that it is generated 24 hours a day, seven days a week. That provides the opportunity to not only sell electricity onto the grid, but also provide steam delivered to houses, public buildings and industry.
Energy-from-waste is a crucial element of SWM because it reduces the volume of waste from disposal also helps in converting the waste into renewable energy and organic manure. Regardless of the origin, content, or hazard potential, solid waste must be managed systematically to ensure environmental best practices. As solid waste management is a critical aspect of environmental hygiene, it must be incorporated into environmental planning.
But many waste to energy plants in India are not operating to their full potential. If the government give better incentives to such SWM plants and the SWM collection methodology, the existing tensions arising out from pollution can be solved and can ensure better cleanliness to the society.