Nifty, Sensex, Bank Nifty may rally, if Greece issue is resolved – Thursday closing report
A close of Nifty above 8,400 would be bullish
We had mentioned in Wednesday’s closing report that NSE’s CNX Nifty will be under pressure until it regains 8,440. However, the Indian stock market reversed direction and closed with marginal losses, proving that the medium term trend is an uptrend.
The top gainers and losers on shares of major indices are given in the table below:
Negative global cues emanating from China and Greece countered the positive sentiments surrounding the upcoming first quarter (Q1) results and led the 30-stock Sensex to close 114 points down on Thursday.
The S&P BSE Sensex closed Thursday 114.06 points or 0.41% down after the day's trade. The Sensex touched a high of 27,798.13 points and a low of 27,540.60 points in the intra-day trade.
The wider 50-scrip Nifty also closed in red. It was down 34.50 points or 0.41% at 8,328.55 points.
Analysts said that after the opening session, markets remained range-bound. However, they soon slipped into negative territory, due to the heavy sell-off in information technology (IT) counters ahead of TCS (Tata Consultancy Services) results. 
Market observers also pointed out that the investor confidence was shaken a day after the barometer index lost 484 points due to fears of a Chinese stock markets meltdown and the stalemate in the Greek debt crisis.
However, the positive bias is being cancelled-out by the negative international cues from China and Greece. 
Even the sharp fall in the light sweet crude oil of West Texas Intermediate (WTI) futures and options index on Wednesday, which pegged a barrel at $50, failed to cheer the markets. 
The India markets which depend on Brent crude oil index are also affected by the price movements of the WTI.
On Friday, the major trigger for the markets will be the Index of Industrial Production (IIP) data.
During Thursday's intra-day trade, healthy buying was observed in capital goods, healthcare and bank stocks. 
However, the IT, oil and gas, automobile, technology, entertainment and media (TECK) and fast moving consumer goods (FMCG) scrip came under intense selling pressure.
The S&P BSE capital goods index augmented by 344.53 points, healthcare index extended-gains by 23.82 points and bank index rose by 21.32 points.
The S&P BSE IT index plunged by 198.47 points, oil and gas index receded by 199.54 points, automobile index plummet by 105.96 points, TECK index was lower by 91.32 points and FMCG index was down by 44.87 points.
The major Sensex gainers during Thursday’s trade were: BHEL, up 3.59% at Rs264.35; Larsen and Toubro (LT), up 2.39% at Rs1,847.50; Hindalco Inds, up 2.21% at Rs.104; Hero MotoCorp, up 2.05% at Rs2,605.40; and Bharti Airtel, up 0.83% at Rs432.90.
The major Sensex losers were: Vedanta, down 4.86% at Rs139; TCS, down 2.80% at Rs2,521.40; Bajaj Auto, down 2.33% at Rs2,513.95; Infosys, down 2.04% at Rs937.70; and Tata Motors, down 1.73% at Rs398.15.
Among the Asian markets, Japan's Nikkei was up by 0.60%, China's Shanghai Composite Index gained by 5.79%, and Hong Kong's Hang Seng rose by 3.73%.
In Europe, the London FTSE 100 index was up by 1.08%, the French CAC 40 was higher by 2.11% and Germany's DAX Index gained by 1.92% at the closing bell in India.
The closing values of select world indices are given in the table below:
Among European indices, DAX was at 10,948.86, up 1.91% and FTSE 100 was at 6,562.69, up 1.11%. Athex Composite Share Price Index was at 797.52, up 2.03%. US index futures were marginally in the red.


Maharashtra Chief Secretary asked to discipline PIOs
The onus of organising the documents meticulously before calling applicants for file inspection would be on the PIOs
Often, Public Information Officers (PIOs) have been asking citizens to visit the office for inspection of files, at very short notice. Even for information that may amount to a couple of pages that could have easily been given by the PIO, as the reply to the information query. All that the PIO had to do, was to apply his mind.
Maharashtra state Chief Information Commissioner (SCIC) Ratnakar Gaikwad, appreciating a circular issued by Ajoy Mehta, the Municipal Commissioner of Mumbai, sent out a detailed notice as to when and how PIOs should call applicants for inspection of files, under the Right to Information (RTI) Act.
The SCIC’s order on 2 July 2015 is a sequel to an email sent by former Central Information Commissioner and RTI activist, Shailesh Gandhi on 30 June, 2015, with reference to Mehta’s order. Mr Gaikwad treated this email from Mr Gandhi as an official complaint under Section 18 (1) (f) of RTI Act and the Commission under provision of Section 19 (8) (a) has directed the Chief Secretary to “issue similar instructions to all the PIOs under the control of the Government of Maharashtra. Compliance of this order should be reported to Commission by 31 July 2015.’’
Mr Gandhi says, “This is one of the rare, pro-active citizen-friendly order and both, Mr Mehta and Mr Gaikwad need appreciation. Now, as directed by SCIC Gaikwad, the Chief Secretary must issue the circular by 31st July, so that it percolates to every public authority in Maharashtra. Also, the rules set for the PIO regarding inspection of files should be put up as large sized posters in offices of the Commission so that PIOs who visit often, read them. The same should be uploaded on websites of public authorities as well.”

BMC’s circular that triggered it all

“The circular issued by Ajoy Mehta, Municipal Commissioner, Mumbai, on 19 May 2015 states that “According to the RTI Act 2005, clause 6(1) in many cases, persons, who have applied for getting information, are intimated by the Public Information Officers (PIOs) to come and inspect the documents. The State Information Commissioner has objected to this in some cases. If the person has not applied for the inspection of documents and the information he has requested is not voluminous, he should not be asked to come for inspection of documents. In such cases, number of pages should be counted and the applicant should be informed to pay the prescribed charges.”
“In cases, where the information requested by the applicant is voluminous, he may be given a chance to see and inspect the documents and given copies of the requisite records by charging the prescribed fee.”
“In cases where the applicant has applied for inspection of the documents or the information he has requested is voluminous, an index of all the documents should be prepared before he is called for inspection of the documents. Also, each page in the file must be numbered. Three dates and timings should be intimated to the applicant before he is called. If these dates are not convenient to the applicant, he should be asked to get in touch with the PIO. The file numbers of the files in which the information requested by the applicant is available, should be intimated.”
“In case, on the date, on which the applicant is coming, the concerned PIO has to go out of office because of some important work, he should hand over the responsibility of giving documents for examination to his colleague or assistant. As directed by the Circular dated 9th July 2009, the office telephone number as well as email address of the PIO should be intimated to the applicant.”

The CIC order that upholds BMC commissioner’s circular for implementation:

The CIC order of 2 July 2015, states that, Shailesh Gandhi, in his mail of 30 June 2015 has pointed out that, “It is seen that for simple information requests, PIOs send letters to applicant asking them to come and inspect records. When the applicant gets time from the PIO to inspect, a bunch of files is offered and the applicant is told to find the information.”
“He (Mr Gandhi) has further mentioned that in this connection, Municipal Commissioner, BMC, has taken a very good initiative by issuing a circular wherein detailed instructions have been given to the effect that the information seeker need not be asked to come for inspection of documents unless the information is voluminous. In those cases, where information requested by the applicant is voluminous, he may be given a chance to see and inspect the documents, but after pages are counted and required charges are communicated to the information seeker.”
The SCIC as mentioned in the article treated Mr Gandhi’s email as an official complaint and directed the Chief Secretary to issue a circular based on 19 May 2015 circular of BMC Commissioner, to all public authorities in Maharashtra.
Kudos to Mr Mehta, Mr Gandhi and Mr Gaikwad – now let us wait for Chief Secretary’s action.
(Vinita Deshmukh is consulting editor of Moneylife, an RTI activist and convener of the Pune Metro Jagruti Abhiyaan. She is the recipient of prestigious awards like the Statesman Award for Rural Reporting which she won twice in 1998 and 2005 and the Chameli Devi Jain award for outstanding media person for her investigation series on Dow Chemicals. She co-authored the book “To The Last Bullet - The Inspiring Story of A Braveheart - Ashok Kamte” with Vinita Kamte and is the author of “The Mighty Fall”.)



nilesh prabhu

2 years ago

excellent. We need more people like Shailesh Gandhi, Deshmukh.

The society should ensure that these people are motivated enought. else they will go the kejriwal way.

Meenal Mamdani

2 years ago

Excellent. Thanks to Vinita Deshmukh we readers now have become aware of the duties of the PIO.

Tax evaders cannot escape easily
The government’s grip over information is tightening not only in respect of transactions undertaken within the country but also overseas
In a liberal economic and low tax rate environment, people are expected to go straight. Tax fraud and tax evasion deprive governments of revenues needed to restore growth and at the same time jeopardise citizens’ trust in the fairness and integrity of the tax system. While the Indian government is building up the information gathering and monitoring system in-house, there are constant efforts, at international level too, for co-operation and exchange of information. 
In the G-20 summit concluded in November 2014, the countries have endorsed the global Common Reporting Standard for Automatic Exchange of Information (AEOI) with a view to ensure the fairness of the international tax system and to secure countries’ revenue bases. During the summit, Indian Prime Minister urged every jurisdiction, especially tax havens, to provide information for tax purposes in accordance with treaty obligations and the country committed to signing of Multilateral Competent Authority Agreement (MCAA), which is a prelude to an annual automatic exchange of information between the governments. India has joined the MCAA on AEOI on 3 June 2015, in Paris, France, along-with Australia, Canada, Costa Rica, Indonesia and New Zealand. 
For implementation of these standards in India and with a view to provide information to other countries, necessary legislative changes have been made through Finance (No. 2) Act, 2014, by amending section 285BA of the Income-¬tax Act, 1961 (‘the Act’). AEOI based on MCAA, when fully implemented, would enable India to receive information from almost every country in the world, including offshore financial centres and would be the key to prevent international tax evasion and would be instrumental in getting information about assets of Indians held abroad including through entities in which Indians are beneficial owners. The endeavour is to begin the exchange of information automatically amongst the 94 jurisdictions by 2017-18, subject to domestic implementation of requisite legislative procedures.
Foreign Account Tax Compliance Act (FATCA)
FATCA, an initiative of US government, compels foreign governments and banks to report bank accounts of entities in which US taxpayers hold a stake. FATCA has fathered a growing global consensus on attacking the off-shoring of illegal wealth. More nations and financial institutions have volunteered to comply, considering draconian fallouts, as the US government will levy a 30% tax on everything flowing from US to a non-compliant institution. Indian Government is also to sign FATCA with US effective September 2015, which is expected to result in additional data flow.

Indian Efforts to curb tax evasion

The Black Money Bill
The Undisclosed Foreign Income & Assets (Imposition of Tax) Bill, 2015 (UFIA) has become law of the land as it receives President’s assent on 26 May 2015. The consequences of non-compliance and oversight, under the Black Money Bill are severe from huge tax to high penalties and prosecution. Prevention of Money Laundering Act (PMLA), 2002 now includes offence of tax evasion under the proposed legislation as a scheduled offence under PMLA. Sub-section (6) of section 195 of the Act has also been amended to require the remitter to report all foreign remittances irrespective of whether these remittances are subject to tax in India or not.
Tax Information Exchange Agreement (TIEA)
Over 500 TIEA signed all over the world and India has over 15 effective TIEA.  India is in negotiations with over 75 countries to broaden the scope of Article containing Exchange of information to specifically allow for exchange of banking information.
Notified Jurisdictional Area (NJA)
Section 94A was introduced in Finance Act 2011, which empowered the government to notify any country, which does not help India in Tax Information Exchange as a Notified jurisdictional Area (NJA) u/s 94A.  In November 2013, Indian government notified Cyprus as a NJA.  The Section was introduced to discourage transactions with countries that do not have an effective tax information exchange systems with India.
Manual on Exchange of Information
The Foreign Tax & Research division of Central Board of Direct Taxes (CBDT) recently released Manual on Exchange of Information (EOI). This Manual is a comprehensively revised document that provides detailed guidelines for framing requests for information under the provisions of tax treaties, as also guidelines for providing clarifications and feedback that would facilitate the receipt of information or evidence.

So can one hold assets outside India?

There are legal ways of remitting money and holding assets outside India. India is persistently poignant on the path of liberalization, by opening up its markets and loosening its controls over economic and financial matters. Under the Liberalised Remittance Scheme (LRS), all resident individuals, including minors, are allowed to freely remit up to $250,000 per year for any permissible transaction. Any Indian resident individual can hold assets abroad acquired from money remitted under LRS for the permitted transaction. An Indian company can make direct investment in a joint venture (JV) or wholly owned subsidiary (WOS) outside India as per the Overseas Direct Investment (ODI) Guidelines. 
The climate is heating up and the Government’s grip over the information is tightening not only in respect of the transactions undertaken within the country but also international ones. Over the next two years, the Indian Government is likely to have full control over the situation as the environment is shifting from opaque to transparent even on the international transactions wherein hundreds of jurisdictions would go out of their way to cooperate with each other in this regard.  One cannot really afford to be casual in one’s approach to comply the law. Truly ‘Gone are the days where offences would go undetected’.
(Neeraj Sharma is Partner at Nangia & Co.)


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