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Monday, February 18, 2019

House rent Allowance (HRA) is part of maximum personnel' income structures. To avail the HRA exemption, you want to post lease receipts or the hire settlement with the residence proprietor for your enterprise. Quoting the owner's permanent Account variety (PAN) is obligatory if the hire paid is more than Rs 1 lakh yearly, i.e., Rs 8,333 a month, to avail the entire advantage of HRA exemption.

But, it may not be that smooth for every person to assert tax exemption on HRA. This is mainly actual within the case of these who have relocated at some point of a financial year and more youthful employees staying far from home.

Here are 3 eventualities young earners are probable to face at the same time as claiming tax exemption on HRA and the way they could address it:

1.Month-to-month lease is more than Rs 8333 but annual lease paid is much less than Rs 1 lakh. Do you still want to cite landlord's PAN?
Allow us to say you've got been staying with your mother and father and in the center of the economic year you relocate to a exceptional city and start residing on your very own. At this rented lodging, you begin paying extra than Rs 8,333 a month as lease.
"As according to a CBDT (Central Board of Direct Taxes) circular, if annual lease paid with the aid of the employee exceeds Rs 1 lakh according to annum, it is obligatory for the worker to report PAN of the owner to the company. therefore, in this situation, PAN of landlord isn't always required if annual lease does now not exceed Rs 1 lakh."

2. Living in a shared accommodation with buddies if you're living along with your buddies and are splitting the lease, having a certainly described rent settlement will help. For this, get a lease agreement made which has the names of all of the lessees and the amount of lease paid stated in opposition to man or woman names. in the absence of an agreement which suggests the splitting up of rent in reality, a statement from the owner specifying the quantity of lease (i.e., your contribution to the entire lease) you are paying, also can assist.
"to assert the HRA tax exemption, one must have the lease receipts and hire agreement. If someone is residing in a shared lodging, then it is recommended to have the lease agreement with the name of all the buddies living in the lodging, the same is going for lease receipts as well. except, it's far greatest if you pay rent through cheque or internet banking, since it additionally serves as evidence for the fee in the direction of rent,"

3.Process relocation and converting accommodation two times or thrice in one FY Getting your rent receipts monthly rather than inquiring for them collectively on the quit of an FY, allows on this situation. Elaborating on this case"In this case where the employee has paid hire to specific house owners, it's far really useful to have the PAN of all landlords if annual lease exceeds Rs 1 lakh. to claim the HRA, one need to have the hire receipts and hire agreement. As mentioned earlier, paying hire via cheque or on-line banking is usually recommended."
let us say you lived in Delhi for six months of a economic yr and paid Rs 10,000 as month-to-month rent and the other 6 months in Pune at Rs 5,000, the overall rent paid in the financial is Rs 90000 (60,000 + 30,000) which is much less than a lakh, you do not want landlord's PAN.
However, if you've had paid Rs 15,000 monthly rent in Delhi for 6 months, and Rs 10,000 in Pune for the ultimate 6 months of the 12 months, the annual rent paid provides as much as Rs 1.5 lakh (ninety,000 + 60,000). So, if the hire paid exceeds Rs 1 lakh, it would be really helpful to get the PAN of each the landlords.

Saturday, February 16, 2019

How to make fee of TDS on sale of assets

TDS desires to be paid on the quantity paid/payable to the vendor/ seller. The consumer can make the payment usage of the e-tax payment option.

The purchaser of an immovable asset (whether or not built up or under creation) of value Rs 50 lakh or extra has the obligation below the earnings Tax Act to pay withholding tax of 1% from the sale consideration payable to the seller of the property. This withholding tax must be deducted at supply and deposited in the authorities’ account as according to the profits tax legal guidelines.

PAN of the client and the vendor is obligatory to make e-payment of TDS on sale of property. but, the TAN (Tax Deduction Account quantity) is not required to make this payment.

Due date: The due date of payment of TDS on transfer of immovable asssets is 30 days from end of the month wherein the deduction is made.

Prerequisites: PAN of the consumer and the seller is obligatory to make e-charge of TDS on sale of property. The TAN (Tax Deduction Account Number) isn't required to make this price.

Hyperlink: TDS charge can be made by way of the consumer on the subsequent hyperlink: https://onlineservices.tin. egov-nsdl.com/etaxnew/tdsnontds.jsp

Form 26QB: To make an internet charge of tax from the e-tax fee option, the consumer is required to fi ll a web shape, 26QB. PAN of the purchaser and seller, details of the belongings, general consideration payable, and payment information ought to be provided.

Charge: TDS needs to be paid on the amount paid/payable to the seller. The buyer can make the payment the use of the e-tax charge option. The tax fee may be made through internet banking portal or by journeying accepted bank branches. once the charge is made, an acknowledgement variety is generated. On coming into the acknowledgment information at a later date, you will generate the submitted shape 26QB for facts.

Form 16B: as soon as tax price is made, form 16B (TDS certificate to be issued via the consumer to the seller) may be downloaded from the internet site of Centralised Processing cellular of TDS (CPC-TDS) at www.tdscpc.gov.in

points to be aware
1. If the property transaction has a couple of celebration as a customer or dealer, form 26QB needs to be crammed by every consumer for precise buyer-dealer aggregate.




Thursday, February 14, 2019

AY-19-20 Under Section 80CA entire guide to investing and I-T rebates


Once you realize the amount required for availing maximum deductions beneath Section 80C, it's time to choose the funding alternative(s) primarily based on their liquidity and taxability of returns.

With the economic year drawing to shut, income tax-payers could have started exploring various tax-saving investment alternatives allowed beneath Sec 80C of the income-Tax Act. however, with various bills and obligatory outflows also qualifying under phase 80C, step one closer to making tax saving investments underneath this segment is to determine out the desired funding quantity.

Required investments for premiere segment 80C deduction
Taxpayers can claim up to Rs 1.50 lakh as deductions below segment 80C. apart from the numerous funding alternatives eligible for availing phase 80C deduction, positive pay-outs and mandatory fees are also included below the same deduction. these include your toddler’s tuition fees, reimbursement of your house loan foremost, your contribution to EPF or recognized provident fund, term coverage charges and stamp obligations and registration costs incurred on obtaining a home loan assets. your desired funding quantity could be the amount left after deducting the required pay-outs from the Rs 1.50 lakh restrict.

for example, assume that your gross annual earnings is Rs 7 lakh and your qualifying obligatory pay-outs encompass Rs eighty,000 as domestic loan primary compensation, Rs 20,000 towards EPF contribution and Rs 10,000 as a time period insurance top rate. you may need to make investments Rs forty,000 inside the investment options eligible for section 80C deduction. investing past this amount might no longer make feel, as all phase 80C funding options come with lock-in length and different restraints.
High-quality investment options

once you understand the quantity required for availing most deductions underneath section 80C, it’s time to pick out the funding alternative(s) based totally on their liquidity and taxability of returns and your personal risk urge for food and go back expectations.

Equity-linked savings Schemes (ELSS): those are often assorted equity mutual budget with a lock-in duration of 3 years from the date of funding. The three-12 months lock-in length is the shortest among all investment alternatives available under segment 80C. The budget can be without difficulty redeemed after the completion of the lock-in length with the credit of redemption amount to the related bank account within 2–three operating days. Being fairness budget, ELSS include the same market danger as other equity funds. but, as equities normally outperform different asset classes through a wide margin over the long-term, ELSS too has outperformed numerous constant income funding alternatives below segment 80C. ELSS as a category has generated an annualised go back of approximately 10%, sixteen% and 16.3% p.a. during the last three-year, 5-12 months and 10-year periods.

As with other mutual finances, you could additionally opt for the systematic investment plan (SIP) mode of investments to ensure disciplined making an investment at ordinary periods. The minimum investment quantity can be as little as Rs 500. even as ELSS too come under the ambit of 10% LTCG tax on equities, maximum retail investors are probable to cease with tax-unfastened maturity as only long term capital gains from equities exceeding Rs 1 lakh in a financial 12 months is taxable.

Unit linked coverage Plans (ULIPs): ULIPs provide the blended blessings of insurance and funding. at the same time as a small part of your top rate is used for offering your life cowl, the final element is used for producing returns thru investments in equities and/or debt contraptions. ULIPs additionally have a longer lock-in length of 5 years and provide switching facility to switch among equity, debt or balanced alternatives relying to your changing hazard urge for food, monetary goals and market outlook.

Public provident fund (PPF): PPF is one of the safest amongst all section 80C funding options. it's far managed via the authorities of India and each the principal and interest additives are sponsored by using the sovereign assure. The scheme is paying an hobby rate of 8% p.a. compounded annually, which is reviewed by way of the Ministry of Finance every zone based totally on the authorities bond yields. because the interest earned and adulthood amount is absolutely tax-free, it gives one of the highest publish-tax returns among all constant profits funding alternatives. but, its long lock-in duration of 15 years is its biggest drawback. Partial withdrawals are allowed simplest from the 7th 12 months of subscription as soon as in a year while untimely closure is allowed after five years for treating existence-threatening diseases or pursuing higher schooling.

National Pension Scheme (NPS): this is a market-linked funding product aimed toward presenting publish-retirement financial security to its subscribers. An annual deduction of as much as Rs 1.five lakh is to be had underneath segment 80C whereas an extra deduction of Rs 50,000 is to be had below phase 80CCD(1B). The investments remain locked-in till the attainment of 60 years by way of the subscriber and at least 40% of the corpus has for use for getting the put up-retirement annuity. at the same time as the quantity withdrawn as a lump sum after the adulthood is tax-free, the earnings derived from the annuity will be taxable as per the subscriber’s tax-slab.

The subscribers also can select among car desire and energetic preference for the motive of asset allocation. In case of active choice, the subscribers can determine their own asset blend by means of citing the ratio of their investments across company, gilt and equity finances. but, the maximum exposure to fairness fund has been capped at 75%. On deciding on the car desire, the subscribers’ contribution may be unfold throughout the company, gilt and fairness funds primarily based at the lifecycle matrix on the basis of the subscribers’ age.

Tax-saving FDs: whilst tax-saving FDs from the publish office and banks score high in phrases of capital safety and reality of returns, their biggest drawback is the taxability of the hobby earnings as consistent with the tax slab of the depositor. while these tax-saving FDs include a lock-in period of five years, the interest income can be paid out each sector or each month or in lump sum at the time of adulthood.

No tax liability in case your earnings is up to Rs 9.5 lakh, however conditions apply


     
Stressing that tax concessions had been supplied with a view to help terrible and middle class people living on a good budget, Finance Minister Piyush Goyal said that now individuals incomes as much as Rs 9.5 lakh can escape legal responsibility through taking benefit of saving schemes.
       Replying to the talk on the Finance invoice in Lok Sabha, the Minister said he did no longer advocate any alternate within the tax price but only furnished few rebates with a purpose to enhance spending and help the economy. The Finance bill, which incorporates tax proposals, was surpassed by way of the Lok Sabha with voice vote, finishing the budgetary method within the lower residence.
     The Minister said as according to the calculations accomplished by means of the officers, an man or woman having income of Rs nine to Rs nine.five lakh can break out profits tax liability by using taking advantage of the host of tax financial savings schemes beneath the earnings Tax Act.
        The concessions proposed inside the Finance bill, Goyal said, are geared toward assisting "poor and center magnificence humans living on tight price range...that is intervening time budget. we have now not delivered any tax concept...we are able to bring them in July," he stated.
       He stated that the Modi government over the last four- and-a-1/2 years tried to benefit each segment of society and tax payers. As a result, he said, the tax base within the u . s . accelerated, the tax collection had doubled within the final 5 years and India has turn out to be the quickest growing foremost economy inside the global.
higher collections, he stated, has enabled the government to earmark more resources for the socially and economically deprived sections of the society.
     The Minister stated that the suggestion to raise preferred deduction from Rs forty,000 to Rs 50,000 and trekking TDS restriction on hobby earnings from Rs 10,000 to Rs forty,000 will offer alleviation to senior residents.
         The housing area, he added, will too get a a lift as a consequence of the proposals along with hobby subvention, permitting capital profits tax exemption on purchase of two residences from proceeds of sale of a house and trekking rebate on repayment of home loans.
        The authorities, he delivered, was working to ensure house for every citizen while India celebrates seventy fifth 12 months of Independence.The government rules have helped in retaining the property fees below check, he stated, including the non- performing property (NPAs) too has remained low in the area, in all likelihood because "housewives insist that the home loans are repaid in time."


Wednesday, February 13, 2019

Angel tax exemption for Startups listed Companies



The Department for Promotion of Industry and Internal Trade (DPIIT) and the Central Board of Direct Taxes (CBDT)  agreed to assemble a list of startups eligible for angel tax exemption, primarily based on their audited monetary statements and earnings tax returns of the preceding 12 months. The notification is probable be issued in a couple of days.
The authorities also determined to raise the most time restrict beneath which a company would be deemed eligible for angel tax exemption to ten years from the sooner seven, a member of the committee set up to investigate the issue stated, talking on situation of anonymity.
in addition, the paid-up share capital threshold underneath which startups could be eligible for an exemption has been set at ?25 crore. In cases in which the funding exceeds ?25 crore, the companies could be eligible for exemption if the angel traders can show a net really worth of ?2 crore or more inside the preceding economic 12 months. For investments beneath ?25 crore, no questions would be asked.
Angel tax is imposed on the excess percentage capital raised by using an unlisted firm, over and above the truthful market price of its shares.This tax commonly influences startups and the angel investments theyattract. even as aimed at curtailing cash-laundering, the angel tax has alsoresulted in a huge range of authentic startups receiving notices fromthe IT branch.
Startups would must grant three kinds of documents which will be registered with the authorities: (i) audited financials for the previousyear,
(ii) IT returns for the previous yr, and
(iii) a self-licensed declaration.
 The assertion is to certify that the company does not have ownership or investments nor plans to deploy the angel investment in real property holdings of any kind and assets, along with premium cars of value above ?10 lakh, gold and art, diamonds, precious metals or jewellery of any type, indexed or unlisted securities without delay or circuitously through fairness mutual finances, or art and cash.
The declaration has to also renowned that if the business enterprise possesses any of those gadgets, then the exemption granted from phase fifty six(2)(viib) might be revoked with retrospective effect.
as soon as these documents are supplied, the DPIIT might ought to validate them, after which publish the call and PAN of most of these groups to the CBDT. The CBDT could then installation a mechanism where such recognized startups do no longer get notices beneath phase 56(2)(viib).
“The DPIIT and the CBDT have agreed to these and the notification can be issued rapidly,” the member advised /The Hindu/. “they also have agreed to boom the duration of operation clause and have also elevated the share capital clause to ?25 crore.”
The DPIIT become earlier thinking about defining a startup eligible for exemption from the angel tax if the aggregate quantity of paid-up percentage capital and share premium after the proposed problem of shares did now notexceed ?10 crore. This has now been raised to ?25 crore.The CBDT, however, stated that it could not halt the proceedings in instancesin which the startups had already been sent a observe by using the profits tax branch.
“concerning the cases in which notices have already been despatched, theauthorities officials are announcing they're going to educate the applicableauthority to shut the case as soon as feasible, and additionally take intoattention the truth that the business enterprise is registered as a startup with
the government,” the committee member stated.



Monday, February 11, 2019

Basic Accounting Entries in Tally


In Tally there are four simple accounting vouchers namely,
Journal Entry
Payment Entry
Contra Entry
Receipt Entry
We are able to have look at them one at a time. we will give an explanation for you with the assist of examples.

Journal Entry
It's far an accounting access that is required to be created while there is no cash or bank account concerned.
So, basically it's far an entry for transactions which outstanding payments or receipts, accounting changes or it may be ultimate entries on the quit of the accounting yr.
In simple words, each time there is no cash account or financial institution account concerned it's miles a journal access.
In ancient times, there used to be a journal book specifically for this kind of accounting entries and hence the name journal entry is given.
Payment Entry
It is basically an entry for paying something.
For example, if you want to pay salary to someone working for you, it will be payment entry.
Or if you want to pay for an expense such as maintenance expenses, you have to pass a payment entry.
You can pay through your bank account or via cash as per you needs.
Contra Entry
When there are just two accounts namely 1) Cash Account and 2) Bank Account an accounting entry which is required to created is Contra Entry.
as an example, you need to deposit your vintage ₹500 and ₹1,000 notes within the bank, the entry required for the above would be a contra access.
On the alternative in case you want to withdraw new ₹2,000 notes in change for the vintage notes, it might again be a contra access.
you may even enter the financial institution info in new edition of Tally.ERP nine like cheque no., wide variety of notes deposited or withdrawn, branch call etc.
Receipt entry
it is the complete opposite of a payment entry.
it's far surpassed whilst you get hold of cash or an amount on your financial institution account.
as an instance, in case you acquire cash for selling matters, it'll be a receipt access.
Or you're paid your revenue in your financial institution account for operating for a person, it will once more be a receipt access.
Their respective Tally shortcuts are
F4 – Contra access
F5 – fee access
F6 – Receipt access
F7 – journal entry

Friday, February 8, 2019

How to link PAN to Aadhaar in 5-step



Link Online
Linking Aadhaar to your PAN is now mandatory and those PANs that are not linked to Aadhaar by the end of December 2017 will be rendered invalid. Besides, to file your tax returns, mentioning Aadhaar number is compulsory. The I-T department has made provision for assesssees to link their PAN to Aadhaar on the e-filing portal. Here's the low-down on how to go about it:
Login
Login to the I-T department's e-filing website https://incometaxindiaefiling.gov.in/. Only registered users can sign-in. In case you are a brand new consumer at the portal, get registered by way of getting into basic registration information such as PAN, call and date of birth.
Fill out the form
Once you are logged into the portal, go to the "Profile Settings" tab. A drop down menu will appear. Click on "Link Aadhaar". A new form will be displayed.
Details
You need to enter name, date of birth and gender as per PAN records. Next, your Aadhaar number and your name as per Aadhaar records must be entered. These details must be submitted after entering the text in the captcha code appearing on the screen.
Confirmation
After submitting the Aadhaar information, a fulfillment message is displayed confirming the linking of Aadhaar with PAN. A affirmation email is also sent to the registered e-mail id of the assesse
Points to note
Once Aadhaar-PAN is linked, one can e-verify the IT return using Aadhaar if the mobile number is registered with Aadhaar database.
If the name in Aadhaar does not exactly match with the call on PAN, you need to additionally provide Aadhaar OTP or EVC to proceed with partial name match.

Thursday, February 7, 2019

Information about Income Tax in India


Taxes levied by means of the government are of  sorts- Direct taxes and indirect taxes. indirect taxes are those which are levied on services and goods. Direct taxes, however, are levied on earnings and profits. for example, provider tax which you pay in a restaurant is an indirect tax while income Tax that is deducted from your revenue each month in the shape of TDS is an example of direct tax.
Income Tax refers to a percent of your income that you are liable to pay at once to the government. The money accumulated through this direct tax path is utilized by the government for infrastructural developments and also to pay the employees of central and state government bodies.
Income Tax Act of India, passed in 1961, governs the provisions for income tax as well as the various deductions that are applicable to it. However, since 1961, the law has been amended several times to take care of inflation and other socio-economic situations.
Income Tax Overview
Income Tax is undoubtedly the most important source of revenue for the Indian government. It is established as an inevitable imposition on the citizens in order to raise funds for fulfilling the development & defence needs of the country.
Taxes imposed on income, purchase, sale, and property help the government to run different government embodiment and machinery.
In India, the first Income Tax Act was introduced in 1860. It wasimplied by James Wilson to overcome heavy losses suffered by the British
Government due to India’s freedom movement in 1857. The history of Income Tax in India is divided into 3 different periods:
 1. 1860-188
 2. 1886-1914
3. 1914 till date
Currently, the Income Tax Act 1961 is applicable in India. In 1956, the government referred the request to impose Income Tax Act. The Law Commission further submitted its report on the Income tax Act in 1958and the same year, Chairman Shri Mahavir Tyagi, chaired the Direct Taxes Administration inquiry Commission.
The Income Tax Act, 1961 was introduced to the public. Since then, it has undergone amendments from time to time.
Any Indian citizen aged below 60 years is liable to pay income tax if their income exceeds 2.5 lakhs. If the individual is above 60 years of age and earns more than Rs.3 lakhs, he/she will have to pay taxes to the government of India. Additionally, the following entities that generate income are liable to pay direct taxes:
·         Hindu Undivided Family (HUF)
·         Body Of Individuals (BOI)
·         Association of Persons (AOP)
·         Local Authorities
·         Corporate firms
·         Companies
·         All Artificial Juridical Persons

Saturday, February 2, 2019


HIGHLIGHTS OF INTERIM BUDGET 2019
      Union Finance Minister Piyush Goyal presented an Interim Budget for 2019 in Parliament on Friday 1st feb 2019. An Interim Budget usually doesn't list out new schemes or doesn't unveil any policy measures. The government will present the vote on account for the next four-to-five months. A full-fledged Budget will be presented after the House reassembles after the general election.





      ·         No income tax for earnings up to 5 lakh
·         IT returns processing in just 24 hours
·         Minimum 14% revenue of GST to states by Central Govt.
·         Individuals with gross income of up to 6.5 lakh need not pay any tax if they make investments in provident funds and prescribed equities
·         Standard deduction has increase from 40000 to 50000
·         Ceiling Limit of TDS u/s 194A has increased from 10000 to 40000
·         Ceiling Limit of TDS u/s 194I has increased from 180000 to 240000
·         TDS threshold on interest on bank and post office deposits raised from ₹10,000 to ₹40,000
·         TDS threshold on rental income increased from 1.8 lakh to 2.4 lakh
·         Within the next 2 years, all verification of tax returns to be done electronically without any interface with the taxpayer
·         Vande Bharat Express, an indigenously developed semi high-speed train, to be launched
·         One lakh digital villages planned in the next five years
·         Package of 6000 per annum for farmers with less than 2 hectares of land. Scheme to be called Pradhan Mantri Kisan Samman Nidhi.
·         Fund allocation for the Northeast region increased to 58,166 crore, a 21% rise over last year for infrastructure development
·         Anti-camcord regulations to be introduced in the Indian Cinematograph Act to prevent piracy and contact theft of Bollywood films.
·         Single window clearance for Indian filmmakers.
·         25 per cent of sourcing for government projects will be from the MSMEs, of which three per cent will be from women entrepreneurs.
·         Recommendations to GST council for reducing GST rates for home buyers
·         National Artificial Intelligence portal to be developed soon
·         ESI cover limit increased to  21,000. Minimum pension also increased to ₹ 1000.
·         Mega pension scheme for workers in the organised sector with an income of less than ₹15,000. They will be able to earn  3000 after the age of 60. The scheme will be called Pradhan Mantri Shramyogi Maan Dhan Yojana.
·         2% interest subvention for farmers pursuing animal husbandry.
·         All farmers affected by severe natural calamities to get 2% interest subvention and additional 3% interest subvention upon timely repayment
·         Decision taken to increase MSP (minimum support price) by 1.5 times the production cost for all 22 crops
·         Capital tax Benefit u/s 54 has increased from investment in one residential house to two residential houses.
·         Benefit u/s 80IB has increased to one more year i.e. 2020
·         Benefit has given to unsold inventory has increased to one year to two years.
·         Other Areas
·         State share has increased to 42%
·         Approval has to be given to PM Kisan Yojana
·         Single window for approval of India film maker
·          

Friday, February 1, 2019

FINANCIAL BUDGET:- (All you needed to think about the Budget)




“The Budget division in the Finance Ministry has complete responsibility over the document”

“An Annual Budget is not only necessary, but compulsory according to the Constitution”


What is a budget and what does it consist of?
A #Budget is an estimate of outflows and inflows that a Government will incur during a financial year. It consists of actual figures for the first year and the budgetary estimate for the present year. For example, a Budget presented in Feb 2019 will have the preceding year, i.e. 2018-19’s actual figures and the evaluations for 2019-20.
When is it presented and by whom?
The Budget is introduced on a day that is determined by the Parliament. While generally it was displayed on the last working day of February, this year, because a new government has come into power, it will be presented on 1 February.
The Budget is presented by the Finance Minister. The Budget division in the Finance Ministry has total duty over it, however it requires last endorsement from the Prime Minister.
A timetable is drawn up by the Budget Advisory Committee of the Parliament. In this calender, a settled time is given for every Ministry to talk about their requirements preceding the Budget introduction.
Is an annual Budget necessary?
It is not only necessary, but compulsory. Under Article 112 of the Constitution, a Statement of Receipts and Payments (estimated) has to be tabled in the Parliament for every financial year. The Receipts and Payments articulation contains united store, possibility support and people in general record.
The consolidated fund is a statement of all the inflows, such as tax revenues; and all expenditure, which constitute outflows. To withdraw from this fund the government requires parliamentary authorisation. The contingency fund is a corpus of about Rs. 50 crore kept aside for unforeseen expenses. The public account is one where all money raised from government schemes, such as Provident Fund, is accounted for.
What does the Budget document contain?
The budget speech and the document has two parts – Part A and B.
Part A is the macroeconomic part of the budget where various schemes are announced, and allocations are made to several sectors. The priorities of the government are also announced in this part.
Part B deals with the Finance Bill, which contains tax collection proposition, for example, salary charge corrections and indirect taxes.
What is the process of Budget approval? What will happen if a Budget is not presented before said date?
The Finance Minister presents the Budget in the Lok Sabha by by way of a speech and gives an outline of the Budget. He at that point tables it in Rajya Sabha.
Both Houses of the Parliament then allot time for a general discussion on the Budget, to which the Finance Minister replies at the end.
Lok Sabha then takes up a discussion on each ministry’s expenditure proposals. After this prescribed period, known as the Demand for Grants, the Speaker applies what is called the ‘guillotine’. Once the ‘guillotine’ is applied, all outstanding demands are put to vote. Though both the Houses of Parliament discuss the Budget, only the Lok Sabha votes on it.
The Appropriation Bill is then introduced after all demands are passed, and once this Bill is passed, the government receives authorisation to draw from the consolidated fund. Once the Appropriation Bill becomes an Act, the Finance Bill is passed. Once this is done, the final Budget gets approved.
In the event that the Budget isn't passed inside the reported date, Article 116 of the Constitution empowers the Lok Sabha to pass the Vote-On-Account, a record which covers just the use brought about.



Thursday, January 31, 2019