Monthly Archives: March 2016

e-Waste Management Rules 2016

The Ministry of Environment, Forest and Climate Change has notified the E-Waste Management Rules, 2016 in supersession of the e-waste (Management & Handling) Rules, 2011.

E-Waste (Management) Rules, 2016-

What’s New?

1. Manufacturer, dealer, refurbisher and Producer Responsibility Organization (PRO) have been introduced as additional stakeholders in the rules.

2. The applicability of the rules has been extended to components, consumables, spares and parts of EEE in addition to equipment as listed in Schedule I.

3. Compact Fluorescent Lamp (CFL) and other mercury containing lamp brought under the purview of rules.

4. Collection mechanism based approach has been adopted to include collection centre, collection point, take back system etc for collection of e-waste by Producers under Extended Producer Responsibility (EPR).

5. Option has been given for setting up of PRO, e-waste exchange, e- retailer, Deposit Refund Scheme as additional channel for implementation of EPR by Producers to ensure efficient channelization of e-waste.

6. Provision for Pan India EPR Authroization by CPCB has been introduced replacing the state wise EPR authorization.

7. Collection and channelisation of e-waste in Extended Producer Responsibility – Authorisation shall be in line with the targets prescribed in Schedule III of the Rules. The phase wise Collection Target for e-waste, which can be either in number or Weight shall be 30% of the quantity of waste generation as indicated in EPR Plan during first two year of implementation of rules followed by 40% during third and fourth years, 50% during fifth and sixth years and 70% during seventh year onwards.

8. Deposit Refund Scheme has been introduced as an additional economic instrument wherein the producer charges an additional amount as a deposit at the time of sale of the electrical and electronic equipment and returns it to the consumer along with interest when the end-oflife electrical and electronic equipment is returned.

9. The e-waste exchange as an option has been provided in the rules as an independent market instrument offering assistance or independent electronic systems offering services for sale and purchase of e-waste generated from end-of-life electrical and electronic equipment between agencies or organizations authorised under these rules.

10.The manufacturer is also now responsible to collect e-waste generated during the manufacture of any electrical and electronic equipment and channelise it for recycling or disposal and seek authorization from SPCB.

11.The dealer, if has been given the responsibility of collection on behalf of the producer, need to collect the e-waste by providing the consumer a box and channelize it to Producer.

12.Dealer or retailer or e-retailer shall refund the amount as per take back system or Deposit Refund Scheme of the producer to the depositor of e-waste.

13.Refurbisher need collect e-waste generated during the process of refurbishing and channelise the waste to authorised dismantler or recycler through its collection centre and seek one time authorization from SPCB.

14.The roles of the State Government has been also introduced in the Rules in order to ensure safety, health and skill development of the workers involved in the dismantling and recycling operations.

15.Department of Industry in State or any other government agency authorised in this regard by the State Government is to ensure earmarking or allocation of industrial space or shed for e-waste dismantling and recycling in the existing and upcoming industrial park, estate and industrial clusters.

16.Department of Labour in the State or any other government agency authorised in this regard by the State Government need to ensure recognition and registration of workers involved in dismantling and recycling; assist formation of groups of such workers to facilitate setting up dismantling facilities; undertake industrial skill development activities for the workers involved in dismantling and recycling; and undertake annual monitoring and to ensure safety & health of workers involved in dismantling and recycling.

17.State Government to prepare integrated plan for effective implementation of these provisions, and to submit annual report to Ministry of Environment, Forest and Climate Change.

18.The transportation of e-waste shall be carried out as per the manifest system whereby the transporter shall be required to carry a document (three copies) prepared by the sender, giving the details.

19.Liability for damages caused to the environment or third party due to improper management of e-waste including provision for levying financial penalty for violation of provisions of the Rules has also been introduced.

20.Urban Local Bodies (Municipal Committee/Council/Corporation) has been assign the duty to collect and channelized the orphan products to authorized dismantler or recycler.

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Bio-Medical Waste Management Rules, 2016

New Bio-Medical Waste Management Rules, 2016 notified by the Ministry of Environment & Forests.

The major salient features of BMW Management Rules, 2016 include the following:-

 (a)                The ambit of the rules has been expanded to include vaccination camps, blood donation camps, surgical camps or any other healthcare activity;

(b)               Phase-out the use of chlorinated plastic bags, gloves and blood bags within two years;

(c)                Pre-treatment of the laboratory waste, microbiological waste, blood samples and blood bagsthrough disinfection orsterilisation on-site in the manner as prescribed by WHOor NACO;

(d)               Provide training to all its health care workers and immunise all health workers regularly;

(e)                Establish a Bar-Code System for bags or containers containing bio-medical waste for disposal;

(f)                Report  major accidents;

(g)               Existing incinerators to achieve the standards for retention time in secondary chamber and Dioxin and Furans within two years;

(h)               Bio-medical waste has been classified in to 4 categories instead 10 to improve the segregation of waste at source;

(i)                 Procedure to get authorisation simplified. Automatic authorisation for bedded hospitals.  The validity of authorization synchronised with validity of consent orders for Bedded HCFs. One time Authorisation for Non-bedded HCFs;

(j)                 The new rules prescribe more stringent standards for incinerator to reduce the emission of pollutants in environment;

(k)               Inclusion of emissions limits for Dioxin and furans;

(l)                 State Government to provide land for setting up common bio-medical waste treatment and disposal facility;

(m)             No occupier shall establish on-site treatment and disposal facility, if a service of `common bio-medical waste treatment facility is available at a distance of seventy-five kilometer.

(n)               Operator of a common bio-medical waste treatment and disposal facility to ensure the  timely collection of bio-medical waste from the HCFs and assist the HCFs in conduct of training

 Bio-medical waste

 Biomedical waste comprises human & animal anatomical waste, treatment apparatus likeneedles, syringes and other materials used in health care facilities in the process of treatment and research.  This waste is generated during diagnosis, treatment or immunisation in hospitals, nursing homes, pathological laboratories, blood bank, etc. Total bio-medical waste generation in the country is 484 TPD from 1,68,869 healthcare facilities (HCF), out of which 447 TPD is treated.

Proper Bio-medical waste management

  1. Scientific disposal of Biomedical Waste through segregation, collection and treatment in an environmentally sound manner minimises the adverse impact on health workers and on the environment. The hospitals are required to put in place the mechanisms for effective disposal either directly or through common biomedical waste treatment and disposal facilities.  The hospitals servicing 1000 patients or more per month are required to obtain authorisation and segregate biomedical waste in to 10 categories, pack five colour backs for disposal.  There are 198 common bio-medical waste treatment facilities (CBMWF) are in operation and 28 are under construction. 21,870 HCFs have their own treatment facilities and 1,31,837 HCFs are using the CBMWFs.

Problems of unscientific Bio-medical waste disposal

iii.            The quantum of waste generated in India is estimated to be 1-2 kg per bed per day in a hospital and 600 gm per day per bed in a clinic. 85% of the hospital waste is non-hazardous, 15% is infectious/hazardous.  Mixing of hazardous results in to contamination and makes the entire waste hazardous. Hence there is necessity to segregate and treat.  Improper disposal increases risk of infection; encourages recycling of prohibited disposables and disposed drugs; and develops resistant microorganisms


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Unified Building Bye-Laws for Delhi

PIB press release dated 30th March, 2016

Unified Building Bye-laws for Delhi, revised after 33 years were  announced by the Minister of Urban Development Shri M.Venkaiah Naidu here today. Elaborating on the new laws, Shri Naidu said they have been made user friendly through unification and simplification of a host of amendments made over the last three decades and integration of approvals by different agencies into a single platform.

Shri Venkaiah Naidu further said that henceforth, building proponents i.e applicants can make one single online application to concerned urban local body instead of approaching various agencies there by reducing human interface and enabling approvals in just 30 days. He said that a single window mechanism comes into effect  so as to improve the ease of doing construction business in the national capital as desired by the Prime Minister’s Office besides promoting investments.

“Delhi’s Building Bye-laws were last revised in 1983 and several amendments were made over the last 3 decades resulting in complexity and even confusion in understanding various changes and filing applications accordingly. To do away with this problem, the Bye-laws have been unified for easy reference besides simplification of processes” said shri Naidu.

            The Minister said that building plan approvals have been streamlined through simplification and integration of processes through following new provisions:

1.One common single application form has been devised for online submission by the building proponents (applicants) to the concerned urban local body instead of applying to various agencies like Airports Authority of India, National Monuments Authority, Delhi Fire Services, Delhi Jal Board, Delhi Urban Arts Commission, Delhi Metro, Power Distribution Companies, concerned central ministries like Forests, Railways, Defence etc.

  1. Applicants will not be required to make required payments to various agencies separately and instead can make single payment to the concerned urban local body electronically.
  2. Seamless integration has been put in place so that concerned urban local body will obtain approvals from other concerned agencies online there by drastically reducing the time taken for sanctions besides eliminating human interface with various agencies. AAI, NMA, DUAC, DMRC etc have been integrated for single window clearance. Central ministries concerned will be integrated shortly. By this, applicants will not be required to separately approach these agencies for approvals/No Objection Certificates.

4.Ministry of Environment, Forests & Climate Change has now concurred to integrate approvals by agreeing to empower urban local bodies to accord Environmental Clearence for built up area up to 1,50,000 as against the present norm of obtaining EC from State Environment Assessment Authorities under  that Ministry for built up area of 20,000 and above up to 1,50,000 sq.mtrs.

5.SARAL Scheme : For residential plots of size up to 105 sq.mtrs, the plot owner need not obtain sanction of building plans. He/she has to just to submit an undertaking intimating about construction along with requisite fees and other documents to start construction.

6.Under risk based classification newly adopted for residential plotted buildings and warehouses/storage facilities/godowns, architect/engineer is empowered to issue building permits for Low Risk residential buildings (105-500 sq.mtrs) and Very Low Risk godowns of up to 250 sq.mtrs. For Low Risk and Moderate Risk category buildings, local bodies will be required to grant permits with in 10 to 20 days.

7.Approvals /No Objection Certificates by external agencies like AAI, NMA, Delhi Fire Services, DMRC, Ministry of Environment etc., shall be issued within 15 days.

8.The number of documents to be submitted for obtaining building permits has been reduced from 40 to just 14.

9.Procedure for obtaining Completion-cum-Occupancy Certificate has been simplified by reducing the number of documents to be submitted by the owner from 36 to just 9.

10.Obtaining permission for commencement of construction has been removed. Instead, the applicant, who had already obtained building permit can intimate the concerned local body and proceed with construction work.

  1. The maximum time limit for granting building permit has been reduced from 60 days to just 30 days to enhance the ease doing business.

12.Local bodies shall prepare an automated calculator for building permit fee including betterment levy, additional FAR etc and be made available on website for use by the applicants.

Promoting safe, green and sustainable construction :

In the context of climate change challenge, the Unified Building Bye-laws for Delhi -2016 seek to promote green and sustainable construction practices.

-All buildings on plot sizes of more than 105 sq.mtrs have to conform to the mandatory green building norms for obtaining sanctions. These include provisions for Water Conservation and Management, Solar Energy Utilization, Energy Efficiency and Management. These measures help in making Delhi more sustainable and environment friendly.

-New Bye-laws require measures for ensuring safety in terms of provisions for structural design and  earthquake disaster mitigation.

Other provisions:

-All buildings and facilities used by the public such as educational, institutional, assembly, commercial, business, mercantile buildings and group housing etc., shall have provision for universal design for differently abled persons, children and the elderly.

-Owners of plots of more than 3,000 sq.mtrs area shall construct public washroom complexes with access from outside, in addition to other mandatory sanitary requirements.

-To present an aesthetically pleasing and vibrant environment, public art shall be promoted in built up areas.

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Construction & Demolition Waste Management Rules 2016

The Government has notified Construction & Demolition Waste Management Rules, 2016 for the first time.  Outlining the salient features of the Construction & Waste Management Rules here today, Union Minister of State (Independent Charge) of Environment, Forest and Climate Change, Shri Prakash Javadekar, said that the rules are an initiative to effectively tackle the issues of pollution and waste management.  Shri Javadekar said that at present, the construction & demolition waste generated is about 530 million tonnes annually.  The Minister said that construction & demolition waste is not a waste, but a resource.  He added that the basis of these Rules is to recover, recycle and reuse the waste generated through construction and demolition.  Shri Javadekar said that segregating construction and demolition waste and depositing it to the collection centres for processing will now be the responsibility of every waste generator.

The Environment Minister highlighted that the local bodies will have to utilize 10-20% material from construction and demolition waste in municipal and government contracts.  Shri Javadekar said that cities with a population of more than one million will commission processing and disposal facility within 18 months from the date of final notification of these rules, while cities with a population of 0.5 to 1 million and those with a population of less than 0.5 million will have to provide these facilities within two years and three years respectively.  “Permission for construction will be given only when the complete construction and demolition waste management plan is presented”, he said.  The Minister also pointed out that large generators of waste will have to pay relevant charges for collection, transportation, processing and disposal, as notified by the concerned authorities.

The draft Construction & Waste Management Rules were published three months ago, to which the Ministry had received 111 suggestions.

The salient features of the Construction & Demolition Waste Management Rules, 2016 are:


(i)        Application


  • Applies to everyone who generates construction and demolition waste.


(ii)        Duties of waste Generators


  • Every waste generator shall segregate construction and demolition waste and deposit at collection centre or handover it to the authorised processing facilities


  • Shall ensure that there is no littering or deposition so as to prevent obstruction to the traffic or the public or drains.


  • Large generators (who generate more than 20 tons or more in one day or 300 tons per project in a month)  shall submit waste management plan and get appropriate approvals from the local authority before starting construction or demolition or remodeling work,


  • Large generators shall  have environment management plan to address the likely environmental issues from construction, demolition, storage, transportation process and disposal / reuse of C & D Waste.


  • Large generators shall segregate the waste into four streams such as  concrete,  soil,  steel, wood and plastics, bricks and mortar,


  • Large generators shall pay relevant charges for collection, transportation, processing and disposal as notified by the concerned authorities;


(iii)       Duties of Service providers and Contractors


  • The service providers shall prepare a comprehensive waste management plan for waste generated within their jurisdiction, within six months from the date of notification of these rules,


  • Shall remove all construction and demolition waste in consultation with the concerned local authority on their own or through any agency.




(iv)       Duties of State Government and Local Authorities


  • The Secretary, UDD in the State Government shall prepare their policy with respect to management of construction and demolition of waste within one year from date of final notification of these rules.


  • The concerned department in the State Government dealing with land shall provide suitable sites for setting up of the storage, processing and recycling facilities for construction and demolition waste with one-and-a-half years from date of final notification of these rules.


  • The Town and Country planning Department shall incorporate the site in the approved land use plan so that there is no disturbance to the processing facility on a long term basis.


  • Shall procure and utilize 10-20% materials made from construction and demolition waste in municipal and Government contracts.


  • Local Authority shall place appropriate containers for collection of waste, removal at regular intervals, transportation to appropriate sites for processing and disposal.


  • LA shall seek detailed plan or undertaking from large generator of  construction and demolition waste and sanction the waste management plan;


  • Seek assistance from concerned authorities for safe disposal of  construction and demolition waste contaminated with industrial hazardous or toxic material or nuclear waste if any;


  • LA shall give appropriate incentives to generator for salvaging,  processing and  or recycling preferably in-situ;


  • LA shall establish a data base and update once in a year,


  • Million plus cities (based on 2011 census of India), shall commission the processing and disposal facility within one-and-a-half years from date of final notification of these rules


  • 0.5 to 1 million cities, shall commission the processing and disposal facility within two years from date of final notification of these rules


  • for other cities (< 0.5 million populations), shall commission the processing and disposal facility within three years from date of final notification of these rules


(v)        Duties of Central Pollution Control Board, State Pollution Control Board or

Pollution Control Committee


  • The Central Pollution Control Board shall prepare operational guidelines related to environmental management of construction and demolition waste.


  • SPCB shall grant authorization to construction and demolition waste processing facility


  • Monitor the implementation of these rules by the concerned local bodies


  • Submit annual report to the Central Pollution Control Board and the State Government.


(v)        Standards for products of construction and demolition waste


  • The Bureau of Indian Standards need to prepare code of practices and standards for products of construction and demolition waste


  • Indian Roads Congress need to prepare standards and practices pertaining to products of construction and demolition waste in roads construction.


(vi)       Duties of Central Ministries


  • The Ministry of Urban Development, and the Ministry of Rural Development, Ministry of Panchayat Raj, shall facilitate local bodies in compliance of these rules;


  • The Ministry of Environment, Forest and Climate Change shall review implementation of these rules as and when required.


(vii)      Facility for processing / recycling facility


  • The operator of the facility shall obtain authorization from State Pollution Control Board or Pollution Control Committee.


  • The processing / recycling site shall be away from habitation clusters, forest areas, water bodies, monuments, National Parks, Wetlands and places of important cultural, historical or religious interest.


  • The processing/recycling facility exceeding five Tones per day capacity, shall maintain a buffer zone of no development around the facility.

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Issue of passports – faster process


The Ministry has announced two major changes recently that will expedite the process for first time passport applicants as well as make it more convenient to secure an appointment at local Passport Seva Kendras.  As per the announcement, the first time passport applicants who furnish Aadhaar Card, Electoral Photo Identity Card (EPIC), PAN Card and an affidavit in the format of Annexure-I will get faster service without payment of any additional fees, subject to successful online validation of Aadhaar and EPIC and PAN Cards, if required from the respective databases. The passports under this liberal dispensation will be issued on Post-Police Verification basis.

 The second measure announced pertains to securing online Appointments for submission of passport applications at Passport Seva Kendras. The new provision is allowing applicants to choose any appointment date from the earliest five available dates (working days) for scheduling/rescheduling an appointment for Passport related services. Earlier, the System used to offer only one available date to the applicants for seeking appointment for Passport related services.

 No extra charge is levied for the services being rendered due to above two announcements.


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Top 20 qualities of smart people

Top 20 Qualities of Smart People In today’s competitive world, it pays to be smart. No matter how smart you are, I am sure there is something you could “get smarter” about. Below are some qualities of smart people. As you read the list, ask yourself: Am I as smart as I could be in this area? How could I get smarter?

  1. Make Decisions Intuitively
    Smart people listen to and follow their intuition. They know how intuitions and insights come to them and are tuned-in internally to make wise decisions.
  2. Are Self-Aware
    Smart people are aware of who they are— strengths, weaknesses, personality, values, etc. As Confucious once said, “He who knows others is wise, he who knows himself is enlightened,” they know that the most important (and interesting) thing to know about is “self.”
  3. Use Active Reflection
    Smart people reflect on and learn from past experiences, finding out what works and what doesn’t, and then adjusts their course of action as needed. They think about things before jumping in, and also take the time after-the-fact to actively reflect to fully understand what happened or didn’t happen.
  4. Think Out-of-Box
    Smart people can easily entertain new ideas, thoughts, and ways of doing things. They crave progressive and forward thinking information, concepts, and people. They often come up with new and radical ideas on a regular basis.
  5. Have An Open-Mind
    Smart people are open to different perspectives and see potential where most people don’t. They would agree with what the quote, “A mind is like a parachute, it only functions when it is open.” They are comfortable with paradoxes and can relate to many sides of an issue or opinion.
  6. Are Responsive
    Smart people recognize and respond quickly to opportunities and people. They act and react fast, and take care of what needs to be taken care-of, well ahead of schedule.
  7. Are Resourceful
    Smart people don’t have to know it all, but they do know where to go to get whatever information, resources, training, education that they need. They are well-networked and have people to call on for resource referrals.
  8. Question Authority
    Smart people think for themselves. They do not blindly believe things so-called “experts” say, in fact, they ask deep questions to discover their own truth.
  9. Upgrade Their Brain
    Smart people stay smart because they are committed to being a lifelong learner. They continuously learn new things, and stay current with their skills, attitudes, and beliefs.
  10. Have a Sense of Humor
    Smart people do not take themselves or life too seriously. They recognize the importance of finding the fun in the irony and the comedy of everyday life.
  11. Take Risks
    Smart people are willing to try out new things, knowing that if it doesn’t work out as intended, failure is often cleverly disguised as a learning opportunity. They “swing out there” often, and it usually pays off.
  12. Trust Themselves
    Smart people believe and trust themselves first and foremost. They don’t have to check with others to make decisions, they instinctively know what is right for them and they go for it!
  13. Write and List Things on Paper
    Smart people have a well-developed life strategy that includes a written life vision/mission, purpose, and goals statement. They also write lists—one for “have to’s” and one for “want to’s.”
  14. Are Productive
    Smart people get things done, through whatever organizational/time management system that works for them. They make the most of each day and take action on important life tasks each and everyday.
  15. Use Discernment
    Smart people are able to discern (see clearly) other’s reasons and motives, so they selectively choose who and what to align themselves with. They surround themselves with only the highest quality people, programs, and places.
  16. Read, Read, Read
    Smart people tap into the collective brain power of others by reading books, magazines, articles—anything that is helpful for their own development. They are also able to filter out the information that fits for them and let the rest go.
  17. Value Learning
    Smart people value the process of learning for learning’s sake. They do not just learn for a specific end—to get a certificate, degree, title, etc. They learn because it is intrinsically rewarding for them.
  18. Teach Others
    Smart people are the teachers of the world, who share their knowledge with other people. They put themselves out there so the rest of us can benefit, and in exchange, their own learning grows and develops because they are actively talking about, researching, and understanding their subject.
  19. Reinvent Themselves
    Smart people do not like to stay the same, they love to grow and develop. They often play with their image, brand, company name, and expand or change it entirely. To stay ahead of the game, they often reinvent themselves time and time again.
  20. Are Students of Life
    Smart people not only know about specific subjects and topics, but also about what it means to be a human being at this time in our evolution. They are insatiably curious and want to know more about becoming bigger and brighter, as a result they naturally evolve.


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Hydrocarbon Exploration & Licensing Policy

PIB Press Release dated 10th March, 2016

The Union Cabinet, chaired by the Prime Minister Shri Narendra Modi, has approved the Hydrocarbon Exploration and Licensing Policy (HELP).


Four main facets of this policy are:

  1. uniform license for exploration and production of all forms of hydrocarbon,
  2. an open acreage policy,

iii.           easy to administer revenue sharing model and

  1. marketing and pricing freedom for the crude oil and natural gas produced.


The decision will enhance domestic oil & gas production, bring substantial investment in the sector andgenerate sizable employment. The policy is also aimed at enhancing transparency and reducing administrative discretion.

The uniform licence will enable the contractor to explore conventional as well as unconventional oil and gas resources including CBM, shale gas/oil, tight gas and gas hydrates under a single license.  The concept ofOpen Acreage Policy will enable E&P companies choose the blocks from the designated area.

Present fiscal system of production sharing based on Investment Multiple and cost recovery /production linked payment will be replaced by a easy to administer revenue sharing model. The earlier contracts were based on the concept of profit sharing where profits are shared between Government and the contractor after recovery of cost. Under the profit sharing methodology, it became necessary for the Government to scrutinize cost details of private participants and this led to many delays and disputes. Under the new regime, the Government will not be concerned with the cost incurred and will receive a share of the gross revenue from the sale of oil, gas etc. This is in tune with Government’s policy of “Ease of Doing Business”.

Recognising the higher risks and costs involved in exploration and production from offshore areas, lower royalty rates for such areas have been provided as compared to NELP royalty rates to encourage exploration and production.  A graded system of royalty rates have been introduced, in which royalty rates decreases from shallow water to deepwater and ultra-deep water. At the same time, royalty rate for onland areas have been kept intact so that revenues to the state governments are not affected. On the lines of NELP, cess and import duty will not be applicable on blocks awarded under the new policy.  This policy also provides formarketing freedom for crude oil and natural gas produced from these blocks.  This is in tune with Government’s policy of “Minimum Government –Maximum Governance

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Amenities for women passengers in Railways

Section 58 of the Railways Act, 1989 provides for earmarking of accommodation for female passengers in trains. Accordingly, in trains carrying passengers, Indian Railways have earmarked following accommodation for female passengers:

i. A reservation quota of six berths in sleeper class in long distance Mail/Express trains.

ii. A combined quota of four lower berths per coach in Sleeper class and two lower berths per coach in Air Conditioned 3 tier (3AC) and Air Conditioned 2 tier (2AC) classes for Senior citizens, Female passengers 45 years of age and above, and pregnant women.

iii. Second class accommodation for women in the second Class-cum-Luggage-cum Guard’s Coach (SLR) in most of the long distance trains.

iv. Unreserved coaches/compartments for female passengers in EMU (Electrical Multiple Unit)/DMU (Diesel Multiple Unit)/MMTS(Multi Modal Transport System) trains & local passenger trains depending upon demand pattern as well as availability of accommodation.

v. Running of ladies special EMU/MEMU/MMTS services on the suburban sections of Mumbai, Kolkata, Secunderabad and Chennai as well as on the Delhi-National Capital Region (NCR) sections.

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Clarifications on EPF withdrawal

PIB release dated 1st March, 2016

Clarification about Changes made in the Tax Treatment for Recognised Provident Fund & National Pension System (NPS)

There seems to be some amount of lack of understanding about the changes made in the General Budget 2016-17 in the tax treatment for recognised Provident Fund & NPS.

The following clarifications are given in this matter:-

(i) The purpose of this reform of making the change in tax regime is to encourage more number of private sector employees to go for pension security after retirement instead of withdrawing the entire money from the Provident Fund Account.

(ii) Towards this objective, the Government has announced that Forty Percent(40%) of the total corpus withdrawn at the time of retirement will be tax exempt both under recognised Provident Fund and NPS.

(iii) It is expected that the employees of private companies will place the remaining 60% of the Corpus in Annuity, out of which they can get regular pension. When this 60% of the remaining Corpus is invested in Annuity, no tax is chargeable. So what it means is that the entire corpus will be tax free, if invested in annuity.

(iv) The Government in this Budget has also made another change which says that when the person investing in Annuity dies and when the original Corpus goes in the hands of his heirs, then again there will be no tax.

(v) The idea behind this mechanism is to encourage people to invest in pension products rather than withdraw and use the entire Corpus after retirement.

(vi) The main category of people for whom EPF scheme was created are the members of EPFO who are within the statutory wage limit of Rs.15,000 per month. Out of around 3.7 crores contributing members of EPFO as on today, around 3 crore subscribers are in this category. For this category of people, there is not going to be any change in the new dispensation.

(vii) However, in EPFO, there are about 60 lakh contributing members who have accepted EPF voluntarily and they are highly – paid employees of private sector companies. For this category of people, amount at present can be withdrawn without any tax liability. We are changing this. What we are saying is that such employee can withdraw without tax liability provided he contributes 60% in annuity product so that pension security can be created for him according to his earning level. However, if he chooses not to put any amount in Annuity product the tax would not be charged on 40%.

(viii) There is no change in the existing tax treatment of Public Provident Fund (PPF).

(ix) Currently there is no monetary ceilings on the employer contribution under EPF with only ceiling being that it would be 12% of the salary of the employee member. Similarly, there is no monetary ceiling on the employer contribution under NPS, except that it would be 10% of salary.

(x) Now the Finance Bill 2016 provides that there would be monetary ceiling of Rs1.5 lakh on employer contribution considered with the ceiling of the 12% rate of employer contribution, whichever is less.

(xi) We have received representations today from various sections suggesting that if the amount of 60% of corpus is not invested in the annuity products, the tax should be levied only on accumulated returns on the corpus and not on the contributed amount. We have also received representations asking for not having any monetary limit on the employer contribution under EPF, because such a limit is not there in NPS. The Finance Minister would be considering all these suggestions and taking a view on it in due course.

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Service tax – exemptions

The Service Tax department has vide its notification no. 9/2016 dated 1st March, 2016 extended further exemptions from the service tax as following. What they have done is amended a mega notification no. 25/2012 dated 20th June, 2012 and all amendments in the nature of exemption notifications are made to this notification. Defeats me why they keep on amending the notifications instead of having a separate chapter itself for exemptions in the Service Tax Act. Some bureacracies fail common sense.

Anyways, the following services are exempt from service tax (it is a detailed list, which I have copied from the portal directly)

1. In the said notification,-

(a) in the first paragraph,- (i) in entry 6, for clause (b) and clause (c), the following clauses shall be substituted, namely,-

“(b) a partnership firm of advocates or an individual as an advocate other than a senior advocate, by way of legal services to- (i) an advocate or partnership firm of advocates providing legal services; (ii) any person other than a business entity; or (iii) a business entity with a turnover up to rupees ten lakh in the preceding financial year; or

(c) a senior advocate by way of legal services to a person other than a person ordinarily carrying out any activity relating to industry, commerce or any other business or profession;”;

(ii) after entry 9A, the following entry shall be inserted with effect from 1st March, 2016, namely,-

“9B. Services provided by the Indian Institutes of Management, as per the guidelines of the Central Government, to their students, by way of the following educational programmes, except Executive Development Programme, –

(a) two year full time residential Post Graduate Programmes in Management for the Post Graduate Diploma in Management, to which admissions are made on the basis of Common Admission Test (CAT), conducted by Indian Institute of Management;

(b) fellow programme in Management;

(c) five year integrated programme in Management.”;

(iii) after entry 9B as so inserted, the following entries shall be inserted, namely:-

“9C. services of assessing bodies empanelled centrally by Directorate General of Training, Ministry of Skill Development and Entrepreneurship by way of assessments under Skill Development Initiative (SDI) Scheme;

9D. services provided by training providers (Project implementation agencies) under Deen Dayal Upadhyaya Grameen Kaushalya Yojana under the Ministry of Rural Development by way of offering skill or vocational training courses certified by National Council For Vocational Training.”;

(iv) after entry 12, with effect from the 1st March, 2016, the following entry shall be inserted, namely-

“12A. Services provided to the Government, a local authority or a governmental authority by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of – (a) a civil structure or any other original works meant predominantly for use other than for commerce, industry, or any other business or profession; (b) a structure meant predominantly for use as (i) an educational, (ii) a clinical, or(iii) an art or cultural establishment; or (c) a residential complex predominantly meant for self-use or the use of their employees or other persons specified in the Explanation 1 to clause (44) of section 65 B of the said Act; under a contract which had been entered into prior to the 1st March, 2015 and on which appropriate stamp duty, where applicable, had been paid prior to such date: provided that nothing contained in this entry shall apply on or after the 1st April, 2020;”;

(v) in entry 13, after item (b), the following items shall be inserted with effect from 1st March, 2016, namely – “(ba) a civil structure or any other original works pertaining to the „In-situ rehabilitation of existing slum dwellers using land as a resource through private participation‟under the Housing for All (Urban) Mission/Pradhan Mantri Awas Yojana, only for existing slum dwellers. (bb) a civil structure or any other original works pertaining to the „Beneficiaryled individual house construction / enhancement under the Housing for All (Urban) Mission/Pradhan Mantri Awas Yojana;”;

(vi) in entry 14, with effect from 1st March, 2016, A. for item (a), the following shall be substituted, namely:-

“(a) railways, excluding monorail and metro; Explanation.-The services by way of construction, erection, commissioning or installation of original works pertaining to monorail or metro, where contracts were entered into before 1st March, 2016, on which appropriate stamp duty, was paid, shall remain exempt.”. B.

after item (c), the following item shall be inserted, namely –

“(ca) low cost houses up to a carpet area of 60 square metres per house in a housing project approved by the competent authority under: (i) the “Affordable Housing in Partnership” component of the Housing for All (Urban) Mission/Pradhan Mantri Awas Yojana; (ii) any housing scheme of a State Government.”.

(vii) after entry 14, with effect from the 1st March, 2016, the following entry shall be inserted, namely-

“14A. Services by way of construction, erection, commissioning, or installation of original works pertaining to an airport or port provided under a contract which had been entered into prior to 1 st March, 2015 and on which appropriate stamp duty, where applicable, had been paid prior to such date: provided that Ministry of Civil Aviation or the Ministry of Shipping in the Government of India, as the case may be, certifies that the contract had been entered into before the 1st March, 2015: provided further that nothing contained in this entry shall apply on or after the 1st April, 2020;”;

(viii) in entry 16, for the words “one lakh rupees”, the words “one lakh and fifty thousand rupees” shall be substituted;

(ix) in entry 23,- (A) after clause (b), the following clause shall be inserted with effect from 1 st June 2016, namely,- “(bb) stage carriage other than air-conditioned stage carriage;”; (B) clause (c) shall be omitted;

(x) in entry 26, after clause (p), the following clause shall be inserted, namely,- “(q) Niramaya‟ Health Insurance Scheme implemented by Trust constituted under the provisions of the National Trust for the Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999 (44 of 1999).”;

(xi) after entry 26B, the following entry shall be inserted, namely,-

“26C. Services of life insurance business provided by way of annuity under the National Pension System regulated by Pension Fund Regulatory and Development Authority of India (PFRDA) under the Pension Fund Regulatory And Development Authority Act, 2013 (23 of 2013);”;

(xii) after entry 48, the following entries shall be inserted, namely,-

“49. Services provided by Employees‟ Provident Fund Organisation (EPFO) to persons governed under the Employees‟ Provident Funds and Miscellaneous Provisions Act, 1952 (19 of 1952);

50. Services provided by Insurance Regulatory and Development Authority of India (IRDA) to insurers under the Insurance Regulatory and Development Authority of India Act, 1999 (41 of 1999);

51. Services provided by Securities and Exchange Board of India (SEBI) set up under the Securities and Exchange Board of India Act, 1992 (15 of 1992) by way of protecting the interests of investors in securities and to promote the development of, and to regulate, the securities market;

52. Services provided by National Centre for Cold Chain Development under Ministry of Agriculture, Cooperation and Farmer‟s Welfare by way of cold chain knowledge dissemination;”;

(xiii) after entry 52 as so inserted, the following entries shall be inserted with effect from 1 st June 2016, namely:-

“53. Services by way of transportation of goods by an aircraft from a place outside India upto the customs station of clearance in India.”;

(b) in paragraph 2, – (i) after clause (b), the following clause shall be inserted with effect from such date on which the Finance Bill, 2016 receives assent of the President of India, namely: – „

(ba) “approved vocational education course” means, – (i) a course run by an industrial training institute or an industrial training centre affiliated to the National Council for Vocational Training or State Council for Vocational Training offering courses in designated trades notified under the Apprentices Act, 1961 (52 of 1961); or (ii) a Modular Employable Skill Course, approved by the National Council of Vocational Training, run by a person registered with the Directorate General of Training, Ministry of Skill Development and Entrepreneurship;‟;

(ii) for clause (oa), the following shall be substituted with effect from such date on which the Finance Bill, 2016, receives assent of the President of India, namely : – „

(oa) “educational institution” means an institution providing services by way of: (i) pre-school education and education up to higher secondary school or equivalent; (ii) education as a part of a curriculum for obtaining a qualification recognised by any law for the time being in force; (iii) education as a part of an approved vocational education course;”;

(iii) after clause (zd), the following clause shall be inserted, namely:- „(zdd) “senior advocate‟ has the meaning assigned to it in section 16 of the Advocates Act, 1961 (25 of 1961);‟

Save as otherwise provided in this notification, this notification shall come into force on the 1st of April, 2016.

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