False and baseless’: Centre rubbishes reports of 20% cut in central govt pensions

On Sunday, the government said that reports of a 20% cut in central government pensions are “false and baseless” and that the government has planned no such measure.

A tweet posted by the Ministry of Finance read, “It is being reported that a 20% cut in Central Government Pensions is being planned. This news is FALSE. There will be no cut in pension disbursements. It is clarified that salaries and pensions will not be affected by Government Cash Management”.

The Department of Pension & Pensioners’ Welfare also issued a statement on the same stating that such rumours have “become a source of worry for the pensioners”, news agency PTI reported.

“As clarified earlier, it is being reiterated that there is no such proposal for reduction of pension and no action is contemplated by the government in this respect. Instead, the government is committed for the welfare and well being of the pensioners,” the communique issued by the DoPPW said.

In the wake of the coronavirus pandemic, the government had announced that senior citizens, differently-abled and widows who are drawing central government pension will get three-month advance pension in the first week of April under the National Social Assistance Program (NSAP). There are 65.26 lakh central government pensioners.

The Government of India has taken a slew of measures to aid the economy and benefit citizens in the wake of the coronavirus crisis. Last month, Finance Minister Nirmala Sitharaman announced a relief package worth Rs 1.70 lakh crore in the wake of the Covid-19 outbreak.

The government has also released around Rs 30,000 crore in assistance to various sections of the society.

Under a special provision, the government had announced that individuals could now withdraw three months salary from Employees’ Provident Fund (EPF) account amid the coronavirus crisis. The EPF withdrawals have been exempt from service charge.

The government has also introduced measures to provide financial assistance to various sections of the society under its schemes such as PM-KISAN, Jan Dhan, Pradhan Mantri Garib Kalyan Ann Yojana, Ujjawala scheme and National Social Assistance Programme.

The number of coronavirus cases in the country has crossed the 15,000-mark. On April 14, Prime Minister Narendra Modi announced that the 21-day nationwide Covid-19 lockdown will be extended till May 3.

Banks not to make any dividend payment amid COVID-19 stress

Providing relaxation to lenders, the Reserve Bank of India on Friday said that banks shall be exempted from making dividend payment in the light of financial difficulties posed by COVID-19 pandemic.

Making a slew of announcement to ease the pressure on financial sector, RBI Governor Shaktikanta Das said that the 90-day norm will not apply on moratorium granted on existing loans by banks.

To maintain financial health, he said, banks have been exempt to make any further dividend payout in view of financial difficulties arising from COVID-19.

On the inflation front, he said CPI based inflation has declined in March and it is expected to ease further.

RBI will take advantage of the falling price situation and pass on benefit to borrowers, he hinted.

Bombay HC gives order NPa calculation 90 days norms to be excluded lock down period

In a major relief to a Mumbai-based construction company, the Bombay High Court said the period of the lock-down is to be excluded while computing 90 days for the declaration of non-performing assets (NPAs).

The decision of the High Court came on a petition by Transcon Iconica, which took a loan from ICICI Bank, and twice failed to make payments - January 15 and February 15 - and this has not been paid until now

According to the RBI circulars and notifications if payment is not made and the accounts are not regularised within 90 days of the date of default, then the borrower's account gets classified as NPAs. But before the completion of this period, the lock-down was announced. The RBI also announced the moratorium on loan payments, which would start from March 1 to May 31.

 

The single judge bench headed by Justice G.S. Patel observed that the period of the moratorium during which there is a lock-down will not be reckoned by ICICI Bank for the purposes of computation of the 90-day NPA declaration period.

 

"As currently advised, therefore, the period of March 1 until May 31 during which there is a lock-down will stand excluded from the 90-day NPA declaration computation until—and this is the condition—the lock-down is lifted", said the High Court.

 

The court also observed that irrespective of the continuance of the moratorium until May 31, if the lock-down is lifted at an earlier date, then this protection available to the petitioners will cease on the date of lifting of the lock-down, and the computing and reckoning of the remainder of the 90-day period will start from that earlier lifting of the lock-down-ending date.

 

The High Court also clarified that this order will not serve as a precedent for any other case in regard to any other borrower who is in default or any other bank. Each of these cases will have to be assessed on their own merits, it said.

 

After the RBI issued a circular giving liberty to all banks to allow a moratorium of three months on payment of installments outstanding as on March 1, the construction company moved the court seeking moratorium period to be "excluded even for the computation of any balance days of the NPA-declaration 90-day period."

 

Justice Patel clarified this order is not a backward extension of the moratorium to January 2020. "The moratorium period of 1st March 2020 to 31st May 2020 does not per se give the petitioners any additional benefits in regard to the prior defaults, i.e. those that occurred before 1st March 2020. Thus, the relief to the petitioners is co-terminus with the lock-down period, not the declared end of the moratorium. This is the only way to harmonise the present requirements of both sides," observed the court.

 

ICICI bank, through its counsel Viraag Tulzapurkar, had however questioned the maintainability of the petition.

Who Will Save Bankers from Corona, Customers and Local Administration?

 While the government announced a package of measures for the poor, it failed to visualise that this may bring customers to the bank and the social distancing could go for a toss, exposing the bankers to the risk of contracting coronavirus. This is exactly what has happened as revealed in a tweetstream of banker who calls himself Newton Bank Kumar (@idesibanda). He created a hashtag #BankerHaiPoliceNahin, which remained trending  on Twitter for quite some time

How many reminders do u need
sir @narendramodi ji?
Banks are becoming the epicenter of CORONA. pls re-think about economic soldiers and citizens.
Thanks to @ABPNews for this coverage.@nsitharaman @idesibanda @ndtv @WHO @IndiaToday @IndianExpress https://t.co/vcWEnQPgHk pic.twitter.com/MrWfYwooPF

— Anil Kumar Meena (@Anilmeena89) April 13, 2020

Banking is the backbone of economy and so during the corona virus (COVID19) pandemic, it was considered as essential service. Bankers were asked to keep branches functioning with skeleton staff. However, due to lack of protective gears and mostly any security, these bankers are finding it very difficult to handle the situation, and are constantly working under fear of catching corona or facing anger from customers.

 

Several unions and associations of bank employees and officers have been raising voices about the risky environment under which they are forced to function. However, till date there is no respite from the government while number of customers visiting bank branches continue to increase. 

 

There have been some incidents where customers tried to attack bankers as well. Main issue all bank staff is facing is overcrowding in branches and lack of social distancing. However, instead of helping bankers do their jobs at some places like Barabanki, and Meerut. 

In fact, in Gurdaspur in Punjab, one deputy commissioner of police detained a bank manager for failing to enforce social distancing norms. As per report from The Tribune, after seating in the police station for half an hour, the manager was asked why he let the customers break social distancing norms.

In March, Indian National Bank Employees' Federation (INBEF) has raised this issue. Subhash S Sawant, general secretary of INBEF, in a letter to Sanjeev Bandlish, convenor of United Forum of Bank Union (UFBU) had said, "Customers irrespective of their age and gender do attend the branches.

 

We do not know their health status. They do use our banking services including toilets, sofas, chairs, and drinking water, whereby we are exposed to the maximum risk of contact. Branches have not even provided with required sanitisation kits and equipment. Under such circumstances it has become very difficult and vulnerable to work at the branches." 

 

Last week AIBEA sent a letter to Debashish Panda, secretary in the department of financial services on special leaves and providing special insurance to bank staffs. In the letter CH Venkatachalam, general Secretary, AIBEA, says, if bankers are quarantined for 14 days or hospitalised for treatment of COVID19, then this should be treated as special leave. 

 

"As a welfare gesture the finance minister has announced that all medial, para-medical and other frontline workers and connected staff who are on duty during this period will get an insurance cover of Rs50 lakh for three months.

 

Since bank staff are also facing the same kind of problem and risk possibilities, banks may be advised to go in for a similar comprehensive group insurance cover against risk to health and life during the next three months," the bank employee union demanded.

 

According to Mr Sawant from INBEF, the main reason for overcrowding in banks is relief deposited by government in bank accounts, especially for poor, who have no other source of income during the lockdown. He says, “We had cautioned the government that instead of depositing Rs500 per month in Jan Dhan accounts of women for three months it would have been better to depositing Rs1,500 in one go so that these account holders will not rush every month to withdraw the said amount. Similarly, other direct benefit transfers to farmers, labourers and weaker section have further added to the woes of the bank employees. There is heavy rush in the bank branches across the country, which have violated the norms of social distancing. Incidents of mob violence and man handling of the bank officials have been reported across the country.”

Basically, central, zonal or regional offices of the bank manage security at branches. When there is no security provided by the bank, the local police station is mandated to regularly visit the branch and mark it in a police diary kept in the branch.  

 

“Instead of providing security to bank officials police authorities are seeking explanations and issuing notices to bankers, which is really unfortunate. It is learnt that the ministry of home has issued advisory to all states to provide protection to doctors, medical and para medical staff. We therefore urge the finance minister, to issue similar advisory for bank staff as well,” Mr Sawant says in a letter sent to finance minister Nirmala Sitharaman

BANK EMPLOYYES TO MANAGEMENT REGARDING COVID19

UPTO 30.06.2020-MORE TIME FOR SUBMITTING FORMS 15G, 15H FOR FY2020-21 TO AVOID TDS

The Director (IT budget) CBDT by order u/s 119 permitted eligible tax payers to submit Form 15G/15H till June 30, 2020 for FY 2020-21. As per the order dated April 3, 2020 posted by the CBDT on its official twitter handle, “In case a person submitted valid 15G/15H to the banks/ for FY 2019-20, then this valid form G and 15 H will remain valid up to 30.06.2020 for FY 2020-21 also”.

The order of Ministry of Finance stated that the above decision was taken in view of the pandemic Covid 19 virus outbreak, resulting in severe disruption in the normal working of almost all sectors of the economy including functions of the Banks, other institutions, etc. In such a situation, there can be instances that some eligible persons may not be able to submit form 15G or 15H timely to the banks and other institutions, etc. that may result in deduction of TDS by banks or other institutions. Therefore to alleviate the genuine hardship of such eligible persons who are required to submit the Form-15G/Form-15H where there is no tax liability, the Director of CBDT issued above directions/clarifications by the exercise of its power u/s 119 of the act, it said. It is reiterated that the payer who has not deducted tax on the basis of the said Form 15G and Form 15H shall require to report details of such payments/credit in the TDS statement for the quarter ending 30.06.20 for FY 2020-21

EXPECTED DA FOR BANKER FROM MAY 2020

 Expected DA Calculation Updated on 31.03.2020 on the basis of CPI for the months of  Jan'20 & CPI for Feb'20 announced on 31.03.20 as 7486.89 (two point down from Jan'20) with the assumptions of CPI for the month of Mar'20 as under:-

1. On assumptions if there is an increase of two point of CPI in the month of Mar'20. In this situation the expected (tentatively) increase in DA Slabs would be Zero and the total tentatively revised DA slabs would remain same 759 i.e. 75.90%.
2. On assumptions if there is increase of three points in CPI in the month of Mar'20. In this situation the expected (tentatively) increase in DA Slabs would come to 12 slabs and the total tentatively revised DA slabs would be 771 i.e. 77.10%.
3. On assumptions if there is increase of four points in CPI in the month of Mar'20. In this situation the expected (tentatively) increase in DA Slabs would come to 14 slabs and the total tentatively revised DA slabs would be 773 i.e. 77.30%.
4. On assumptions if there is an decrease of two point of CPI in the month of Mar'20. In this situation the expected (tentatively) decrease in DA Slabs would be six and the total tentatively revised DA slabs would be 7539 i.e. 75.30%.