atmanirbhar bharat abhiyan package simplified · to make the norms of classification growth...
TRANSCRIPT
PART 1
ATMANIRBHAR
BHARAT ABHIYAN
PACKAGE SIMPLIFIED
As pledged by our Hon’ble Prime Minister to spend a total of 20 lakh crore to scale up the
economy and to balance the fallout in economy due corona virus pandemic, various packages
have been announced under Part 1 of Atmanirbhar Bharat Abhiyan (Self-Reliant India
Movement) to cater various sections including cottage industry, MSMEs, labourers, middle
class, industries, among others.
Union Finance Minister Nirmala Sitharaman on 13th May, 2020 in the First Phase has
announced various packages/ benefits to benefit various economic sectors.
The package broadly covers relief and benefits to MSMEs, Employee Provident fund Relief,
cut in TDS rate, extension of various statutory deadlines, ITR filling deadline extension and
many more benefits.
MSME stands for Micro, Small and Medium Enterprises. MSME sector has not only emerged
as a highly vibrant and dynamic sector but also played a very important role in the socio-
economic development of the Country and have contributed significantly in terms of Gross
Domestic Product (GDP), Exports and Employment generation.
In last 5 years Government of India has taken various initiates and measure to for the growth
of MSME Sector in the Country. Following are the initiatives under Atmanirbhar Bharat
Abhiyan for MSMEs.
To make the norms of classification growth oriented and align them to the new tax regime
revolving around GST (Goods & Services Tax), Government under Atmanirbhar Bharat
Abhiyan has decided to revise the definition of micro, small and medium enterprises by
introducing an additional criteria or turnover. Also, in the new definition a distinction
between manufacturing and service sector will be eliminated.
OLD CLASSIFICATION
CLASSIFICATION MANUFACTURING ENTERPRISE SERVICE ENTERPRISE
MICRO upto ₹25 lakh upto ₹10 lakh
SMALL above ₹25 lakh upto ₹5 crore above ₹10 lakh upto ₹2 crore
MEDIUM Above ₹5 crore upto ₹10 crore above ₹2 crore upto ₹5 crore
INTRODUCTION
MSME ANNOUNCEMENTS
REVISED CLASSIFICATION OF MSME
NEW CLASSIFICATION
CLASSIFICATION MANUFACTURING & SERVICE ENTERPRISE
MICRO Investment upto 1 crore and
Turnover upto 5 crore
SMALL Investment upto 10 crore and
Turnover upto 50 crore
MEDIUM Investment upto 20 crore and
Turnover upto 100 crore
Government under Atmanirbhar Bharat Abhiyan, has decided to provide Rs. 3 lakh crores
Collateral-free Automatic Loans for Businesses, including MSMEs (emergency credit line) with
a cap on interest. Also, loan will have 100% credit guarantee, which means that in the event
when MSME unit, which availed collateral- free credit loan, fails to discharge its liabilities to
the lender, the Government will provide 100% credit guarantee cover to Banks and NBFCs on
principal and interest.
WHO IS ELIGIBLE?
India’s micro, small and medium enterprises (MSMEs) having outstanding loan upto Rs 25
crore or those with a turnover less than Rs 100 crore.
TENURE OF LOAN
Loan will have a tenure of 4 years with Moratorium of 12months (payment to lender will start
after 12 months) on Principal repayment.
The loan can be availed upto 31st October, 2020 from eligible banks and NBFCs.
Under Atmanirbhar Bharat Abhiyan Indian Government has announced Rs 20,000 crores
subordinate debt for stressed Ministry of Micro, Small and Medium Enterprises (MSMEs) for
enabling stressed MSMEs to equity issues.
Subordinate debt refers to a debt which has have subordinate status in relationship to the
normal debt. It has a lower priority over other debts in case of liquidation during bankruptcy.
WHO IS ELIGIBLE?
Functioning MSMEs which are either Non-Performing Assets (NPA) or are stressed will be
eligible for equity support
COLLATERAL-FREE AUTOMATIC LOANS FOR BUSINESSES, INCLUDING MSMES
SUBORDINATE DEBT FOR STRESSED MSMES
FINANCIAL ASSISTANCE
1. Provision of Rs.20,000 crore as subordinate debt
2. Support of Rs.4,000 Crore to Credit Guarantee Fund Trust for Micro and Small Enterprises
(CGTMSE) which will in turn provide partial credit guarantee support to banks. Banks will
use this fund to promoters of MSMEs which will be used by promoters to infuse equity in
MSME units.
Under this a fund named “fund of Funds” will be established with a corpus of Rs 10,000 crore
and will provide equity funding for MSMEs. It will help MSMES to expand their size and
capacity and also enclosure them to get listed on main board of Stock Exchanges
WHO IS ELIGIBLE?
MSMEs having growth potential and viability
FINANCIAL ASSISTANCE
Fund structure will help leverage Rs. 50,000 crores of funds at daughter funds level
OEPRATIONS
The fund will be operated through various Mother Fund and few daughter funds.
Due to lack of information, scarcity of resources and unorganized ways of selling / marketing,
MSME sector often faces problems in exploring new markets and retaining existing ones. In
order to promote self-reliant India and support Make in India, Government has disallowed
global tenders upto Rs 200 crores in government procurements.
Necessary amendment in the General Financial Rules will be effected.
1. e-market linkage for MSMEs to be promoted which will in time replace trade fairs and
exhibitions
2. Fintech will be used to enhance transaction-based lending using the
3. MSME receivables from Government and CPSEs to be released in 45 days
EQUITY INFUSION FOR MSMES THROUGH FUND OF FUNDS
GLOBAL TENDERS TO BE DISALLOWED
OTHER INITIATIVES
Out of Total 15 packages/ benefits announced by Finance Minister Nirmala Sitharaman, 3
benefits/ packages are under Direct Tax and 2 benefits/ packages are for taxpayers and
employers. Below are the benefits/ packages under Direct Tax.
➢ Due date of all Income Tax Returns for AY 20-21 extended to 30 Nov, 2020
➢ Tax audit in all cases due date extended to 31 Oct, 2020
EARLIER NOW
TAX AUDIT REPORT 30th September 31st October
ITR 31st October 30th November
➢ Date of Assessment for those getting time barred on 30 Sep, 2020 extended to 31 Dec,
2020
➢ Date of Assessment for those getting time barred on 31 March, 2021 will be extended to
30 Sep, 2021
➢ Payment under “Vivad se Vishwas Scheme” can now be paid till 31 Dec, 2020 without
any additional amount
Rates of Tax Deduction at Source and Tax Collected at Source reduced by 25% for all non -
salaried payments to residents. i.e (Payment for Contract, Professional Fees, Interest,
dividend, commission, brokerage etc) for the period 14.05.2020 to 31.03.2021 (FY 2020-21)
Tentative Rates of TDS are given below for reference:
DIRECT TAX ANNOUNCEMENTS
EXTENSION IN DUE DATES
REDUCTION IN TDS/ TCS RATES
SECTION NATURE OF INCOME RATE OF TDS APPLICABLE FOR THE PERIOD
01-04-2020 TO 13-05-2020
14-05-2020 TO 31-03-2021
193 Interest on securities 10% 7.5%
194 Dividend 10% 7.5%
194A Interest other than interest on securities
10% 7.5%
194C Payment to contractors
- 1% :If deductee is an individual or HUF -2%:In any other case
- .75% :If deductee is an individual or HUF -1.5%:In any other case
194D Insurance commission
-10% :If deductee is domestic company -5%:In any other case
-7.5% :If deductee is domestic company -3.75%:In any other case
194G Commission and other payments on
sale of lottery tickets
5% 3.75%
194H Commission and Brokerage
5% 3.75%
194-I Rent -10%:If Rent pertains to hiring of Building and furniture or fitting -2% :If rent pertains to hiring of plant and machinery
-7.5%:If Rent pertains to hiring of Building and furniture or fitting -1.5% :If rent pertains to hiring of plant and machinery
194J Royalty and fees for Professional or
Technical Services
-2%:If recipient is engaged in business of operation of call centre -2%: If sum payable towards fees for technical services (other than professional services) 10%: In all cases
-1.5%:If recipient is engaged in business of operation of call centre -1.5%: If sum payable towards fees for technical services (other than professional services) 7.5%: In all cases
194M Payment to contractor,
commission agent, professional by
certain Individuals or HUF
5% 3.75%
194N Cash Withdrawal -2%:If Cash withdrawn exceed Rs. 1Crore
1.5%:If Cash withdrawn exceed Rs. 1Crore
All pending refunds to charitable trust non- corporate business & professions including
proprietorship, partnership, LLP and Co- operatives shall be issued immediately
The prevailing circumstances have posed challenges for the Global Economy, the Indian
Economy being one of the worst-hit. There is a huge financial stress in India accordingly,
Individuals, Businesses, Corporates etc. are facing huge difficulties while raising funds from
Banks, PFIs, NBFCs, MFIs etc. which are necessary for their business. Further, the situation is
expected to worsen in the coming days due to the non-availability of antidote for the COVID-
19 pandemic.
A Special Liquidity Scheme (Scheme) of Rs. 30,000 Crore has been announced for
NBFCs/HFCs/MFIs.
As NBFCs/HFCs/MFIs are finding it difficult to raise money in debt markets, they can avail this
scheme, thereby will ensure liquidity in the economy.
Under this scheme investment will be made in both primary and secondary market
transactions in investment grade debt paper of NBFCs/HFCs/MFIs whereby the securities will
be fully guaranteed by GoI.
Meaning of Partial Credit Guarantee Scheme: This scheme was offered by Government of
India (GoI) to Public Sector Banks (PSBs) for purchasing high-rated pooled assets from
financially sound Non-Banking Financial Companies (NBFCs) / Housing Finance Companies
(HFCs).
The GoI taking cognizance of the need of liquidity with NBFCs/ HFCs/ MFIs having low credit
rating have introduced Partial Credit Guarantee Scheme 2.0 (PCGS 2.0) with a view to ensure
liquidity & fund availability for MSMEs & Individuals. Accordingly, the existing PCGS
scheme will be extended to cover borrowings such as primary issuance of Bonds/ Commercial
OTHERS
ANNOUNCEMENTS FOR NBFCs/ HFCs/ MFIs
SPECIAL LIQUIDITY SCHEME
PARTIAL CREDIT GUARANTEE SCHEME
Papers (CPs) of such entities. Further, under the scheme the first 20% of loss will be borne by
the GoI.
Once the scheme is properly implemented, it will ensure liquidity of Rs. 45,000 Crore.
To provide relief to law abiding companies in the wake of COVID 19, various relaxations have
been provided under Companies, Act, 2013. Below are the relaxations provided under
Atmanirbhar Bharat Abhiyan.
➢ Mandatory Board Meetings extended by 60 days till 30 September
Provisions of Companies Act, 2013 Relaxation Remark
According to section 173 of the Companies Act, 2013, every Company shall hold minimum four Board Meetings of its Board of Directors every year in a such a manner that not more than 120 days shall intervene between two consecutive meetings of the Board
Mandatory Board Meetings extended by 60 days till 30 September
Gap between two consecutive Board Meeting may extend to 180 days till 30th September, 2020
➢ Allowing Extra Ordinary General Meetings through Video Conference with e-
voting/simplified voting facility
Provisions of Companies Act, 2013
Relaxation Remark
Provision of Companies Act, 2013 provides that Extra Ordinary General Meeting should be held at registered office of India or any other place in India, and shareholders /proxies are required to attend the meeting physically.
Allowing Extra Ordinary General Meetings through Video Conference with e-voting/simplified voting facility
Relaxation is provided for holding Extra Ordinary General Meeting through video Conferencing mode for passing ordinary and special resolution
RELAXATIONS UNDER COMPANIES ACT, 2013
EXTENSION OF TIME LIMIT FOR HOLDING BOARD MEETING
EXTRA ORDINARY GENERAL MEETINGS THROUGH VIDEO CONFERENCING MODE
Now while opening and getting back to work Businesses continue to face financial stress, to
combat this situation the government has announced various Reliefs Relating to EPF
contributions by employer and employees
Reliefs provided under Atmanirbhar Bharat Abhiyan are:
➢ Government to bear PF payment of 24% for 3 more months for units with upto 100 workers
& with 90% having salary less than 15000 p.m.
This was provided earlier for salary months of March, April and May 2020 now it will be
extended by another 3 months June, July and August 2020.
CONTRIBUTION
➢ Statutory PF contribution of both employer and employee will be reduced to 10% each
from existing 12% each for all establishments covered by EPFO for next 3 months. (except
CPSEs and PSUs).
This scheme will be applicable for workers who are not eligible for 24% EPF support under
PM Garib Kalyan Package and its extension.
EPF ANNOUNCEMENTS
NOW
Government will pay aggregate of
both i.e.
24%
8.33%
12%
Earlier
Employer 12%
------------
NOW
Employee0%
Earlier
Employee 12%
------------
NOW
Employee0%
PF CONTRIBUTION BY GOVERNMENT
REDUCED RATE OF EPF CONTRIBUTION
Many Infrastructure projects are facing uncertainties w.r.t Timely Completion of Projects,
Project financing. As a result of which Government Introduce various economic packages for
real estate projects under RERA
The Ministry of Housing and urban affairs will advise states and union territories and their
regulatory authorities to
➢ Treat COVID 19 as “Force Majeure” under RERA
(Force Majeure means an event or effect that can be neither anticipated nor controlled.
It is Contractual Provision which essentially free both the parties from liability or
obligations)
➢ Extend the registration and completion date Suo- moto by 6 months for all registered
projects expiring on or after 25thMarch,2020 without individual applications.
➢ Regulatory Authorities may extend registration and completion date for further period
of 3 months, if needed
➢ Authorities can issue fresh “Project Registration Certificate” automatically with revised
guidelines
➢ Authorities can extend timelines of various compliances under RERA Concurrently
These measures will de-stress real estate developers and ensure completion of projects so
that homebuyers are able to get delivery of their booked houses with new timelines."
OTHERS
ECONOMIC PACKAGES FOR REAL ESTATE PROJECTS UNDER RERA
EXTENDING FILING GST RETURNS TO END OF JUNE 2020
Rs. 90,000 CR LIQUIDITY INJECTION FOR DISCOMS
RS. 1.70 LAKH CRORE RELIEF PACKAGE UNDER PRADHAN MANTRI GARIB
KALYAN YOJANA FOR THE POOR