Demonetization: Taxpayers to get I-T notices

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Aman Sadha, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur


 

According to the sources, Government claims to have identified 18 lakh individuals who will be required to disclose the large cash transactions through their individual accounts soon after the demonetization rule by the PM of India, Narendra Modi. These accounts were identified using data analytics, in the period of 9th Nov 2016 to 30th Dec 2016, by matching the transactions of an account with the account holder’s tax profile.

For the convenience of the people, tax department has enabled online verification of these transactions. Every permanent account holder would be able to view information about their transactions through income tax e-filing portal. Swacch Dhan Abhiyan is a tax department’s programming software which is supposed to be used for getting answers on the deposits made, and only after a preliminary session of questions and answers, legal actions would be taken. Furthermore, for the ease of people, they will also be informed through messages and emails by income-tax department. The accused will have to file their explanations online at ‘www.incometaxindiaefiling.gov.in’ within 10 days to avoid notices and legal enforcement.

According to the Income tax department, in the initial phase, they will put up data of people, using data analytics, who deposited more than 5 lakhs during the period or who has poor tax compliance or with suspicious transactions up to 5 lakhs. If tax department gets satisfied with the information, there would be no follow up. Tax department has also provided a reference guide and a helpdesk number for the smooth functioning of this initiative. Additionally, the verification will be closed if the cash deposit is made under Pradhan Mantri Garib Kalyan Yojan (PMGKY), the disclosure scheme of black money. This initiative has received mixed responses from the general public, but it is surely going to create trouble for the arbitragers, who took this demonetization as an opportunity for lifting up their bank balances.

 

An Ugly Marble Cake…

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Adwait Nigade, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur


It looked amazing…just as if God had decided to bake a marble cake! And this is my reaction just by seeing the photos available on the internet (one of which you can see below). The sight was of a supreme beauty, one that only nature could create! It definitely looked picturesque…the snow settled on the sand as the largest dry desert of our planet experienced a heavy snowfall. As beautiful as it may look, snow falling on the sand dunes of Sahara is something very rare. It has happened just once before, thirty seven years ago in a much lesser intensity and the underlying reason to it is not so beautiful…rather it’s ugly!

Well, to be scientific, an extremely low pressure area was passing over North Africa which on hitting the landmass caused the air to cool suddenly and condense, thus the snowfall. But going beyond the theoretical explanation, this is a living proof of the damage we’ve done to our planet.

Global Warming, later rechristened as ‘Global Climate Change’ has been nibbling at our healthy existence slowly but steadily and the issue has clearly not been given the attention it deserves. Its only now, when few of the biggest cities in the world have become literally uninhabitable have we “somewhat” realised the gravity of the situation.

Since last few years, many parts of earth are witnessing unusual phenomenon like early melting of glaciers, heat waves in winters, undue monsoons etc. Nature has always given us subtle hints regarding the continuous damage we’ve been inflicting on it and we as the civilization have been vehemently ignoring them. But as of late, the hints have started becoming bolder like the incident stated above.

Nevertheless, it was a treat for the eyes to see white snow mixed with red sand, however we must strengthen our efforts towards green initiatives. The government of Kiribati, a pacific island nation with unparalleled beauty is buying land in Fiji for relocation of its citizens since the sea level has been constantly rising and the coral island nation may cease to exist few years down the line! Are we serious! Has it really come to this? Well, in that case it won’t be far when we would be searching for a new planet to relocate!

At the international level the environment protection must not be limited to signing of treaties somewhere in the Alps, but formulating measures to implement them. At the individual level too, there’s a lot we can and must do. For starters, let’s pay attention if we switch off the A/C next time we leave the room!

Post-Budget market effects

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Prakhar Agrawal, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur

If historical data is to be believed then there are high chances of stock market corrections immediately after the budget. In the few weeks following the budgets since 2001, the indices as well as the broader market had changed momentum.
The market surged before the 2015 budget and fell immediately thereafter. The reverse happened after the 2016 budget. The market which had been falling till then rose after the budget.

Unlike the past two years, traders have very little expectations from this year’s Budget as it is coming between two major events: Demonetization and UP elections. The rise in share prices in the last month is partly due to large companies announcing better than expected quarter results than before despite the cash crunch brought brought about by demonetization rather than any serious expectations from the budget.
Also the uncertainties  over the outcome of the UP polls, which begin in February are keeping the traders worried. The traders feel that effect of UP polls will have more effect on the market than the budget.
Traders say that though anything negative will throw the market down by several points bu that will be a buying opportunity  to buy for investors. The farm and the infrastructure sectors along with the handling of fiscal deficit are the prime macro indicators that will be on the trader radars.

 

Honest Criminals

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Avantika Bhargava, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur


Digitisation has crept within government and businesses in India after the night of 8th November 2016. The reluctance which prevailed amongst us due to inefficient online banking systems was forced upon and now what stands in front is the hard earned money unprotected. This is not an exaggeration. Let me explain why.

Considering the spiked growth in online transactions, cybercriminals can now comfortably run their organised business operations. Ransomware is a league that haunts many businesses and individuals.

If critical files in our personal laptop become inaccessible someday by a ransomware operator by encrypting and scrambling the data, only to find out that we need to pay a sum to the cyber attacker to gain access to those CRITICAL files. It sounds disastrous. On successful payment, they shall deliver the decryption key as a perfect business partner as the mafia is cautious about its reputation and do not soil it.

In order to avoid this malware mafia and its bigger plans, India is trying to push biometric authentication for Aadhaar based transactions but fingerprints also stand under the radar because of wear out. Problem with an iris or finger print scan is that one can cut off your thumb and still use it to gain access. A very recent technology which uses infrared to read blood veins in the palm has come out as an answer to this problem.

While India needs to gear up, a new regulation will come into force from 2018 in the EU mandating tough penalties to check the growth of this malware mafia of honest criminals.

Ban on Immigrants!!!

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Jayita De, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur

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US president, Donald Trump has recently signed an executive order banning refugees from six countries from 120 days. Ban on Syrian refugees is for indefinite time period. It is not important whether these six countries are Muslim countries or not, it is the question of humanity.

United State of America has always been the favorite destination for immigrants from all over the world. On that context, decision by US President has questioned the existence of all the immigrants in US. Currently, US immigrant population stood at more than 42.4 million or 13.3 percent of the total US population. So, if US continues with this BAN on these seven countries and even adds more countries in the list in future, it will definitely affect US economy.  All the famous US universities offer higher education to the students from all over the world. If this ban continues, the diversification, the unique feature of these universities, will not be there. Not only in the education sector, in the work force also the immigrants play a major role to control the economy.

Mr. Donald Trump defended himself as he wants to erase terrorism from US. But does terrorism belong to any country? The children from these countries could have studied in any of the US universities and could even play a major role to progress US economy. Those children are not at all part of the terrorism, so why they are paying off? Terrorism is a disease that can’t be stopped in this way. Education, economic development can be a remedy of this problem, not a ban on any immigrants will solve it.

Reckless Driving

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Santanu Chakraborty, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur

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An analysis of school Bus crashes has revealed that reckless driving is one of the major cause of such incident. In spite of various rules and guidelines to make travel safe for school children, such incidents are very common. The major reason behind it is that these rules and regulations are not being followed properly.

It is really disheartening to see such young lives fade away because of some people who do not abide by the law. The rules should be thoroughly looked into and if necessary should be revised. It is also the responsibility of the schools and the parents who are engaging these drivers to do a thorough background check of the drivers. Schools should devise their own tests which the drivers should pass and not rely on the contractors to take the call on whether the driver should be appointed on not. Parents should also get a report about the drivers past records before sending their child in the bus. But how to raise awareness about this problem? Government should publish various print and TVC which would talk about the rules and regulations that are already at place.A strict implementation and abiding of the rules is the only solution to this problem which has claiming hundreds of innocent lives every year.

U.S. withdrawal from the Trans-Pacific Partnership

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Amrutha Bhamidimukkula, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur


Trans Pacific Partnership(TPP) is an agreement negotiated by 12 countries: the United States, Canada, Mexico, Peru, and Chile in the Americas, and Japan, Australia, Vietnam, Malaysia, Singapore, Brunei, and New Zealand in the Asia-Pacific. Together, they comprise almost 40 percent of the world’s gross domestic product. The pact aimed to deepen economic ties between these nations, slashing tariffs and fostering trade to boost growth. Members had also hoped to foster a closer relationship on economic policies and regulation.  Not only does TPP slash tariffs, it contains anti-corruption measures, intellectual property obligations, human rights, child labor conditions and environmental commitments.

The agreement was designed so that it could eventually create a new single market, something like that of the EU.

Former President Barack Obama treated trade deals as a priority during his tenure, and this particular deal would have bolstered America’s position in the Asia-Pacific region, where China is growing in influence.

But Donald Trump exploited a misconception that TPP would lead to a loss of U.S. jobs. The rationale Trump has given for withdrawing from TPP is that it disadvantaged American industry and intensified competition between the member countries’ labor forces. He believes that dealing directly with individual countries on a one to one basis in negotiating future trade deals would me more beneficial for the United States of America.

This is not entirely convincing. According to a study, TPP would have led to only a 0.1% increase in U.S. labor market churn and added 9% to U.S. exports by 2030.

It is hard to see who exactly benefits from the United States’ withdrawal from TPP. Certainly, the U.S. industry and other TPP members will be disappointed. Trump’s decision has already been criticized by some American political leaders, including fellow members of the Republican Party. Trump will gain credibility with some of his base by actually fulfilling one of his more contentious campaign promises, but that base is weak to begin with, and unless there are tangible gains in manufacturing jobs, the electoral impact is likely to be negligible.

Easy Life

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Rishita Pramanik, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur


 

For the last 2-3 months, we all were stressed due to demonetization. For most of us, it was more about our own discomfort than what Modi ji was trying to achieve. We always want things easy, don’t we? In such a period where cash is an integral part of our day-to-day life, and ‘cashless’ is the latest buzzword, there are still some who go cashless…voluntarily! Stupid people, aren’t they?

In a small Hamlet around 32 kms. from Guwahati, members of the Tiwa tribe meet every year for a unique trade fair where the dealings are totally cashless. The trade follows the barter system which was used in the markets during the Harappa and Mohenjodaro era. This is a 500 year old tradition and the tribals are religiously following it.
We always consider the tribal people as less intelligent beings… Well, they may or may not be but those people are certainly more sorted out than us. We claim that technology has made our life easier but on seeing them I doubt it. They live a simple life with minimum wants and hence maximum satisfaction which keeps them happy. Now this is what I can call as an easy life.
But yes, there’s a chance it may not be that way. After all, the grass is always greener on the other side… so let’s just focus on watering the one on our side!

Union Budget 2017- Marching Uncertain Territory

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Aman Sadha, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur


 

Arun Jaitley, the finance minister, will be presenting the Union Budget on February 1, a month before the usual date and barely three months after the Black Swan event of the Modi Government. The global uncertainties, the Trump Factor, Brexit issues, in addition with no measure of the long tail of demonetization presents a daunting situation in front of the chief statistician of the country.

As Jaitley has already mentioned in the interviews that the economy is slowing down, the path ahead for the Minister looks turbulent. Especially when he has to merge the railway budget in the fiscal plan- which was presented separately for last 92 years- everyone’s eyes are fixed on the file he will be put in front of country in a weeks’ time.

We are well aware that after the godly monsoon rains, the single biggest factor that impacts our economy is the international prices of the oil. Oil prices has been a respite to the Modi Government since he took office in 2014, but the volatile nature of both these factors are enough to trouble the minds of even the sharpest. International Market has seen recent rise in oil prices and a barrel of is expected to reach a price of $65 in 2018 compared with $40 in April’16.

With the cushion of oil taken off, and the pangs of demonetization hovering on top the government must find ways to generate revenue required to sustain the infrastructure development and other ambitious plans floated by the PM. The buoyancy seen in tax collection in the recent past and the voluntary income disclosures are the comforting factor for the Finance Minister. We need to wait and see how he handles the issues around and come on top of them to take our country forward amidst all the uncertainties.