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Sebi Betting on Artificial Intelligence to Keep a Tab on Social Media Posts

The Securities and Exchange Board of India is acquiring capabilities to keep a tab on social media posts to track market manipulations, its chief Ajay Tyagi said on Thursday. The regulator plans to create a ‘data lake’ project to augment analytical capability that would involve the use of artificial intelligence, deep learning, big data analytics, pattern recognition, and structured and natural language processing tools to spot manipulations.

“Social media platforms are increasingly being used by manipulators for market manipulation. Regulators worldwide are increasingly acknowledging that there is much more surveillance input that can be gained from such social media platforms,” Tyagi said at a research conference organised by Sebi and National Institute of Securities Markets (NISM).

“We want to acquire technology and unstructure data analysis because structured data analysis is not helping much, manipulators use all sort of things. So, analysis of what is coming in social media, which largely is unstructured data, and language processing, that is a must to see in addition to pricing volume changes. We intend to acquire that technology.” A tender has been floated for acquiring the technology. In recent times, Sebi has been doing social media screening related to corporate announcements and price volume issues in insider-trading cases. “We are anyway doing data analysis and seeing unstructured data in our surveillance department and trying to correlate with pricing volume data to come to better analysis,” Tyagi said.

Last year, in a case of frontrunning of several funds of the Fidelity Group, the regulator checked the profile of a trader at a matrimonial site in order to establish his link with the family members. In another insider-trading case related to Deep Industries, Sebi checked the Facebook profiles of suspected persons to ascertain whether they were connected to each other. The regulator found that the entities involved were friends on the social networking platform and had ‘liked’ each other’s pictures posted on the site.

Source :- The Economic Times, 24th January 2020

India faces first fall in direct taxes in at least two decades: Report

India's corporate and income tax collection for the current year is likely to fall for the first time in at least two decades, over half a dozen senior tax officials told Reuters, amid a sharp fall in economic growth and cut in corporate tax rates.

Prime Minister Narendra Modi's government was targetting direct tax collection of 13.5 trillion rupees ($189 billion) for the year ending March 31 - a 17% increase over the prior fiscal year.

However, a sharp decline in demand has stung businesses, forcing companies to cut investment and jobs, denting tax collections and prompting the government to forecast 5% growth for this fiscal year - the slowest in 11 years.

The tax department had managed to collect only 7.3 trillion rupees as of Jan. 23, more than 5.5% below the amount collected by the same point last year, said a senior tax official.

After collecting taxes from companies in advance for the first three quarters, officials typically garner about 30-35% of annual direct taxes in the final three months, data from the past three years shows.

But eight senior tax officials interviewed by Reuters said despite their best efforts direct tax collections this financial year were likely to fall below the 11.5 trillion collected in 2018-19.

"Forget the target. This will be the first time that we'll see a fall in direct tax collection ever," said a tax official in New Delhi. He estimates that direct tax collections for this year could end up roughly 10% below fiscal 2019.
Direct taxes typically account for about 80% of the government's projections for annual revenue, and the shortfall may leave the government needing to boost borrowing to meet expenditure commitments.

The tax officials also say that a surprise cut in headline corporate tax rate last year aimed at wooing manufacturers and boosting investment in Asia's third-biggest economy is another key reason behind the sluggish tax collections.

"We'll be very happy if we can even breakeven with what we collected last year," said another senior tax official in the financial capital Mumbai, the biggest tax generator, accounting for about a third of revenues from direct taxes. "But given the state of the economy, I'm not too hopeful."

Read more at:
https://economictimes.indiatimes.com/news/economy/finance/india-faces-first-fall-in-direct-taxes-in-at-least-two-decades-sources/articleshow/73582140.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

India faces first fall in direct taxes in at least two decades: Report The govt had set a target of Rs 13.5 trillion as direct tax collection for the current year.

Pratik Pujara and Associates updated their business hours.

Six ways in which the Budget can turn the economy around

Read more at:
https://economictimes.indiatimes.com/news/et-explains/et-explains-six-ways-in-which-the-budget-could-turn-the-economy-around/articleshow/73579468.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

With an aim to unearth financial irregularities and other fraudulent transactions at listed companies, capital market regulator Sebi is planning to set up a new whistle-blower Mechanism for auditors and other 'gate-keepers' to report such cases.

The proposed move assumes significance in the wake of several auditors in the recent past
decided to exit from their audit mandate after certain listed companies failed to take remedial
actions despite financial wrongdoings having been flagged in their auditors' observations.
Officials said most of these auditor exits have taken place at a much later stage, but a 'confidentiality mechanism' can help in cases of financial frauds being reported at an early stage by auditors, independent directors and others considered to be 'gate-keepers' or
'conscience keepers'.

Regulators and enforcement agencies have often stressed that auditors, independent directors, investment bankers, valuers and other such entities have a greater responsibility to ensure compliance to regulations and safeguard the interest by minority shareholders.

While Securities and Exchange Board of India (Sebi) has announced a new mechanism to reward informants with up to Rs 1 crore cash for any credible inside information for providing information on insider trading at listed companies, this is not applicable to corporate entities and professionals such as auditors and lawyers.

While there were suggestions from some quarters that auditors, lawyers and consultants on behalf of their firms should also be allowed to avail the 'informant mechanism', Sebi was of the view that corporate entities were as such under a duty to report. Besides, lawyers are bound of confidentiality and it would considered unethical for them to complain against their clients.

"However, as far as gate-keepers such as auditors are considered, a separate confidentiality mechanism is being proposed," a top official said.

The proposal is in early stages as of now and a final decision would be taken only after a detailed consultation process with all the concerned Stakeholders, the official added.

The proposed mechanism may cover all kinds of financial irregularities and fraudulent activities, unlike the 'informant mechanism' which is Limited to the cases of insider trading.

During the earlier consultation process for the 'informant mechanism', it was also proposed that disgruntled employees and those facing complaints from the concerned entities should not be allowed to become an informant.

However, SEBI rejected the suggestion while observing that such people could be actually best possible sources for providing an evidence which was otherwise difficult to obtain.

However, Sebi has put in place sufficient safeguard to w**d out unwanted tip-offs and frivolous information. Officials said it is imperative for Sebi to employ all legitimate means to detect any wrongdoing and initiate action at the earliest to instill confidence among investors and ensure integrity of the market.

But, Sebi faces several challenges in establishing links and procuring proof while probing cases like insider trading and other fraudulent activities, due to which investigation into such cases takes much longer time than in other cases of market manipulation.

Source - https://economictimes.indiatimes.com/markets/stocks/news/sebi-mulls-new-whistle-blower-mechanism-for-auditors-other-gate-keepers/articleshow/71135999.cms

Sebi mulls new whistle-blower mechanism for auditors, other 'gate-keepers' The proposed move assumes significance in the wake of several auditor exits.

The GST Council approved a sharp reduction in the levy on homes under construction and raised the threshold for affordable housing that will make more purchases eligible for concessional tax, offering substantial relief to buyers ahead of the elections. Starting April 1, homes under construction will be levied 5% GST, against 12%. For affordable homes, GST will drop to 1% from 8%.

Homes up to Rs 45 lakh and with a carpet area of up to 60 sq metres in metros and 90 sq metres in non-metro cities will be counted in the affordable segment, according to the new twin definition cleared by the council, which is expected to give a big boost to lower-income housing. The earlier limit was a uniform carpet area of up to 60 sq metres for a house in an approved affordable housing scheme. There will be no input tax credit for GST paid on materials such as cement and steel for the sector at these lower GST rates.

“In its 33rd meeting, the GST Council has accorded big relief to real estate sector,” FM Arun Jaitley tweeted. “This (rate cut) will give boost to housing for all & fulfill aspirations of neo/middle classes.” The government said in a statement that “the buyer of house gets a fair price and affordable housing gets very attractive with GST @ 1%”.
The GST Council deferred a decision on lotteries, Jaitley said, adding the group of ministers (GoM) will meet again to discuss the proposal.

“A reduced effective rate of GST of 5%/1% is good news for the real estate industry as the 12%/8% rate was a bit of a deterrent for buyers of underconstruction properties,” said EY tax partner Abhishek Jain.
Intermediate tax on transfer of development rights (TDR), joint development agreement (JDA), lease (premium), floor space index (FSI) will be exempt from GST for such residential property on which GST is payable.

‘Simpler Tax Compliance for Builders’

The government said this will address the cash flow problems faced by the industry.

“There are reports of slowdown in the sector and low offtake of under-construction houses which needs to be addressed,” the statement said.
It would also result in the cost of houses coming down, the government said.

“Unutilised ITC (input tax credit), which used to become cost at the end of the project, gets removed and should lead to better pricing. Tax structure and tax compliance becomes simpler for builders,” it said in the statement.

“Developers will need to increase the base price to recover the loss of input credit but would need to be cautious given the surge in anti-profiteering investigations for restaurants, in similar circumstances,” said Pratik Jain, partner and leader, indirect tax, PwC.

The decision was based on recommendations of a ministerial panel headed by Gujarat deputy chief minister Nitin Patel.

Those designated as metro cities are Mumbai, Bengaluru, Chennai, Hyderabad and Kolkata apart from the National Capital Region — Delhi, Noida, Greater Noida, Ghaziabad, Gurgaon and Faridabad. Separately, the Reserve Bank of India had imposed a monetary limit of Rs 30 lakh for non-metros and Rs 45 lakh for metros for affordable housing loans. Builders had been seeking a lower GST rate

Source - https://economictimes.indiatimes.com/news/economy/policy/gst-council-cuts-rates-sharply-to-make-room-for-housing-growth/articleshow/68145245.cms

GST Council cuts rates sharply to make room for housing growth Starting April 1, homes under construction will be levied 5% GST, against 12%. For affordable homes, GST will drop to 1% from 8%.

Focus on farmers, poor & middle-class: President unveils govt's agenda for 'New India' in Budget session

Kick starting the Budget Session with an address to joint session of Parliament, President Ram Nath Kovind today said India was going through "uncertain times" ahead of the 2014 Lok Sabha elections and the Narendra Modi government after assuming power has taken several initiatives to build a 'New India'.

President said that the government's main aim is to better the living condition of the people. The government has been working to fulfil hopes and aspirations of all sections of people, he said.

Highlighting the government's achievements and various welfare schemes, President said the government is working hard to build a New India which is giving new hope to the people.

Here is what he said:
* National security is our top priority. Compromising with security needs is not in interest of present & future of country. Surgical strikes gave India a new dignity.

* After decades of delays, Indian Air Force will induct a new generation ultra modern fighter jet Rafale next month.

* Government feels that Eastern Uttar Pradesh, Bihar, West Bengal and Odisha and entire East India have potential to become the new growth engine of India. It is working strengthen the infrastructure in these areas with building of new highways, rail lines, waterways and airways.

* GST is a long-term policy and is a boon for the business sector. The taxpayers in the country trust this government.

* More than Rs 3 lakh crore has been recovered under the Bankruptcy and Insolvency Code.

*Over Rs 6.5 lakh crore have been transferred to beneficiaries under different Direct Benefit Transfer Schemes. This has resulted in savings of nearly Rs 1.10 lakh crore. Government has removed nearly 8 crore ghost beneficiaries who were only present on papers.

* More than Rs 50,000 crore worth of assets have been siezed under the Benami and Prevention of Money Laundering Act.

* In 2014, 3.8 crore taxpayers filed returns in 2014, which has now increased to 6.8 crore

* Nearly 34 crore bank accounts have been opened under Jan Dhan Yojana. Every family is now connected to the banking channels. Rs 88,000 crore deposited in these accounts is a proof that saving habits are changing in India.

* According to an international agency, 55 per cent of the total bank accounts opened between 2014-2017 were opened in India itself.

* In 2014, the cost of 1GB data was Rs 250, it has now fallen down to Rs 10-12. Today India is the biggest nation with mobile phones.

*Before 2014, Ony 59 village panchayats had the digital connectivity. Today 16,000 village gram panchayats have optical fibre connectivity and nearly 40,000 panchayats have Wi-Fi hotspots.

* Government is making all efforts to double the farm income. It has taken historic decision to increase the MSP of 22 crops to nearly one and half times of the production cost.

* More than 15 crore entrepreneurs have taken benefits of Pradhan Mantri Mudra Yojana. Women have been a big beneficiary of this scheme, more than 73 percent beneficiaries are women.

* Government has reduced taxes and have kept inflation under control. This has increased prospects of more savings for the middle-class. Government is making effort so that hard-working middle class gets higher income and get more avenues for better investments.

* My government is working to bring light to everybody's life. Today every village has an electricity connection. In 2014, there were 18,000 villages that were not connected to electric grid.

* Affordable houses were difficult because of black money. My government has worked to bring more transparency in the realty sector with introduction of RERA law.

*Healthcare is my government’s topmost priority. I am happy to inform you that the benefits of government’s schemes are reaching poorest of the poor.

* My govt understood this & started Ayushman Bharat Yojana. In last 4 months more than 10 Lakh poor people availed health benefits in hospitals under this scheme.

* As many as 4,900 Jan Aushadhi Centres have been opened in over 600 districts in past few years. More than 700 medicines are available at cheap rates in these centres

* This year is important because country is celebrating the 150th birth anniversary of Mahatma Gandhi. Country is also celebrating the 70 anniversary of Constitution

* My government has build 9 crore toilets under Swacch Bharat Abhiyaan. The coverage is now over 98 percent. It was less than 40 percent in 2014.

* There were only 14 crore gas connection in 2014. My government has given 13 crore gas connections in the last four and half years.

*Citizenship Amendment Bill will make it easier to provide Indian citizenship to those who had to take refuge in India after facing oppression somewhere else. They were not at fault, they were victims of situations like that.

Source :-
https://economictimes.indiatimes.com/news/politics-and-nation/india-was-going-through-uncertainty-before-2014-govt-is-forming-a-new-india-president-ram-nath-kovind/articleshow/67768169.cms

Focus on farmers, poor & middle-class: President unveils govt's agenda for 'New India' in Budget session Kick starting the Budget session, President Ram Nath Kovind said that the government's main aim to better the living condition of the people.

Govt to pay half of extended maternity leave benefit

The government is likely to clear before the interim budget a proposal to fund half of the paid leave amount that employers give in the extended maternity leave benefit
scheme, as part of schemes planned for women voters ahead of the general election.

“The scheme is pending approval from finance ministry. Labour ministry is hopeful it will be cleared soon,” a senior labour ministry official, who did not wish to be named, told ET, adding that an announcement to this effect could be made in the interim budget.

As per the proposal, the government will pay the salary for seven weeks of extended leave under maternity benefits offered by companies. This amount will be reimbursed to employers who have engaged women workers with a wage ceiling up to Rs 15,000 and provide 26 weeks’ paid maternity leave.

The finance ministry had wanted to know the labour ministry’s intent behind the scheme and had sought clarifications on the proposal twice. It is estimated that the scheme will cost the government about Rs 400 crore every year. It will reduce the cost pressure on companies and could also encourage hiring of women. An amendment to the Maternity Benefits Act, passed in March 2017, raised paid maternity
leave for women from 12 weeks to 26 weeks, benefitting 1.8 million women workers in the organised sector. The law applies to all establishments employing 10 or more people, and the
entitlement applies only up to the first two children.

Govt to pay half of extended maternity leave benefit The finance ministry had wanted to know the labour ministrys intent behind the scheme and had sought clarifications on the proposal twice.