MM TAX CLUB

The Monthly Account of the Union Government of India upto the month of February, 2024 has been consolidated and reports published. The highlights are given below:-

The Government of India has received ₹22,45,922 crore (81.5% of corresponding RE 2023-24 of Total Receipts) upto February, 2024 comprising ₹18,49,452 crore Tax Revenue (Net to Centre), ₹3,60,330 crore of Non-Tax Revenue and ₹36,140 crore of Non-Debt Capital Receipts. Non-Debt Capital Receipts consists of Recovery of Loans ₹23,480 crore and Miscellaneous Capital Receipts of ₹12,660 crore. ₹10,33,433 crore has been transferred to State Governments as Devolution of Share of Taxes by Government of India upto this period which is ₹2,25,345 crore higher than the previous year.

Total Expenditure incurred by Government of India is ₹37,47,287 crore (83.4% of corresponding RE 2023-24), out of which ₹29,41,674 crore is on Revenue Account and ₹8,05,613 crore is on Capital Account. Out of the Total Revenue Expenditure, ₹8,80,788 crore is on account of Interest Payments and ₹3,60,997 crore is on account of Major Subsidies. 

The rate of interest on Government of India Floating Rate Bond 2033 (GOI FRB 2033) applicable for the half year March 22, 2024 to September 21, 2024 shall be 8.34 percent per annum.

It may be recalled that FRB 2033 carries a coupon, which has a base rate equivalent to the average of the Weighted Average Yield (WAY) of last three auctions (from the rate fixing day, i.e., March 22, 2024) of 182 Day T-Bills, plus a fixed spread (1.22 percent).

The Reserve Bank of India (RBI) has, by an order dated March 04, 2024, imposed a monetary penalty of ₹26.60 lakh (Rupees Twenty Six lakh Sixty thousand only) on The Kalupur Commercial Co-operative Bank Ltd., Ahmedabad (the bank), for contravention of the provisions of section 26 A (2) read with section 56 of the Banking Regulation Act, 1949 (BR Act) and for non-compliance with RBI directions on ‘Loans and advances to directors, their relatives, and firms / concerns in which they are interested’. This penalty has been imposed in exercise of powers vested in RBI, conferred under provisions of section 47A(1)(c) read with sections 46(4)(i) and 56 of the BR Act.

The statutory inspection of the bank was conducted by RBI with reference to its financial position as on March 31, 2022. Based on supervisory findings of non-compliance with statutory provision/RBI directions and related correspondence in that regard, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the instructions.

After considering the bank’s reply to the notice and oral submissions made during the personal hearing, RBI found, inter alia, that the following charges against the bank were sustained, warranting imposition of monetary penalty to the extent of non-compliance. The bank had (i) not transferred eligible amounts to the Depositor Education and Awareness Fund within the prescribed period and (ii) renewed two advances to a company in which the relative of a director of the bank was interested, being a major shareholder in the company.

This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction of agreement entered into by the bank with its customers. Further, imposition of this monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank.