Monday, 3 April 2017

Laws of injustice

Ban sale of liquor on all National, State Highways from 1 April: Supreme Court

I woke up to this news and not much affected I was busy with my usual work. Then visiting social media I realised how the order shall affect lacs of people and families who had liquor stores and paid good amounts for their excise license.

Going into further details I saw the figures in newspapers. Revenue for five star hotel chains like Oberoi,Taj ,Hyatt and Accor groups together with small and medium enterprises shall cause a loss of 65000 crores to hospitality industry. 

Leaving the revenue loss it shall render lacs of people jobless and out of work in a scenario where jobs are in scarcity and banks not willing to give loans. Further to this SC changes the distance to 500 metres from Highway. So basically new shops and restaurants will come up and existing ones will die.

Someone looking for Alcohol will have no issues driving another 500 metres or even stocking the same with him. Surprisingly in this case banks are prompt to take recover loans advanced to vendors on highway who are duly servicing them and paying taxes. Banks only go on silent mode when Rich and influential are involved. Else they are quick to send recovery agents if you miss EMI for your car.

It is not the first time that rules have been mended to favour others. I remember few years back I was about to invest in a residential house to be rented to a bank as that the entire colony road was being used for commercial purposes in Malviya Nagar and Saket. However the deal go delayed and I missed out. 

Few days later all commercial activities were banned and my regret also went away. In fact I complimented congress government for acting strictly on illegal occupants. However to my surprise few months later all bans lifted and now commercial activities on highest scale all over the place. You can guess the motive?

Yes, six to seven malls were coming up in Saket and the entire mafia wanted the shopkeepers to shift to malls as they were not selling. As soon as Malls got their tenants the commercial activity again opened up as that is daily wage for MLA and other authorities of the area


My friend had a chemist shop on Vasant Kunj road which was threatened as illegal as it leads to airport and they wanted to broaden the road. Rightly so. He in hurry sold the shop to someone else. This is 10 years back. Has the road changed? No. No one shall dare to demolish illegal construction on that road leading to world best Airport,IGI. Reason coz majority is occupied by the peace loving religion.


The same is happening again. Shifting shops 500 to 200 metres is not going to solve any issue but shall create more jobless people and help others (who knows who) have already invested in property in area not covered within the distance. Is this fair? Business from one hand to other without any change in sales?


Saturday, 1 April 2017

Irrigation/Agriculture Masala Bonds

As my normal routine I hit the gym in the morning. After the workout sitting on the coffee table with others normal conversation started. 

" So what does your son plan to do when he passes out of school after couple of years" asked someone. Before I answered others said " Admission in good university in India is a dream" Then it went on to reservation and other flaws in education system.

Then started the gossips." You know that family is sending their son after 10th to London for further studies" said a lady

" But how is it possible? They are sitting on bank defaults on more than 200 crores" replied the other

"Really! But her son drives Porsche to school everyday" said the first one. How will they justify the fees to London school?"

"Oh don't worry. They have accounts outside. They even planning to buy house there" replied the first one.

Then the discussion went on to cars. Which car has better status symbol. Should one invest in Bitcoin. Which is latest bike being launched.......Seemed these were biggest tensions in their life.

As I reached home I saw my maid as usual was cleaning the house smiling. I asked her what time you wake up. " 3.30AM in the morning" She replied. The water only for one hour and she needs to wake up to fill the same. 

Entire day theses thoughts crossed my mind. Here are few having accounts outside and sitting on Bank NPA but enjoying all in life yet living in fear. And We have the others trying to make their ends meet. Then I came across how farmers in South India are distressed. Why is India still so much dependent on monsoons after 6 decades of independence?


Agriculture sector in India contributes to 18% of  GDP. With almost 50% of the population depending on it. 
 Except the Ganga plains and the narrow Brahmaputra plains of Assam which  comprise 40% of total area of India all the other areas are drained by seasonal rivers. i.e almost 60% of area is rainfed. And monsoons are the only source of rainfall for India . South west monsoon (90% of total rainfall) and North East ( remaining 10%).  So 60% of agriculture is dependent on monsoons
Big mistake, the economic survey of India predicts  1% rise or fall in agriculture sector will make .5% rise or fall in manufacturing sector viz. 

So, when we are eyeing for 9% growth when our agriculture sector falls it drags our manufacturing sector with it. Hence our economy is indeed the gamble of monsoons.
The current distress also underlines the disturbing reality that nearly 53% of crop area in India is unirrigated and that rain gods continue to decide the fate of nearly three quarters of the Indian population.





One may think its just 18% of total activity how does it alter economy much. 





Recognizing this structural gap, the Union budget presented  put in more funds for irrigation schemes  towards the flagship Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) and more funds towards a long-term irrigation fund.
But whether India will be able to drought-proof agriculture in the coming years will depend as much on how states prioritize irrigation.
And then suddenly this thought struck me like lightening. Money slashed abroad and people buying properties, Using grey markets and various routes to escape future disclosures. Swiss and other authorities on other hand changing their stance every few days on sharing of information.
On the other hand irrigation and agriculture infrastructure in India needs a major shakeup. How much government can allocate is also a tricky situation. It cannot afford to cross fiscal deficit figures so spending is limited. 



Is there a way out. "yes said my heart" I might sound stupid but suddenly this idea started to cross my mind. " WHAT IF GOVERNMENT ISSUES IRRIGATION OR AGRICULTURE BONDS FOR MONEY ABROD"  There might be argument why these black money hoarders be left like this?
But look at the brighter side. No interest payment on issuance of these bonds. Money paid back after maturity in India after 30% tax deducted post tenure of bonds. 
Now comes the other argument. Indian INR already appreciating and broke levels of 65 against dollar on Friday. Such huge inflow of dollar if this scheme implemented shall further strengthen INR and big setback for exports. So now where is the solution.
Why can't government issue Masala agriculture bonds outside India in dollar? Now this can be game changer. The money collected through theses bonds shall have zero coupon bonds and paid back to accounts of those who came out with disclosure after tenure of bonds. And without doubt with 20% or 30% taxation.
Now government can pay the dollars collected to pay world leaders in irrigation projects outside India to lay out projects in our villages. Netafim a world leader in drip irrigation,Doron and many more. 



The idea might sound very sketchy and may be novice but do give it a thought. Rather than money in accounts outside being of no economic value and most of account holders in panic state unable to figure out what is way forward, and banks also not helping much. It might make some sense to collect this money in dollars and use the same for our poor farmers.
This shall take them faster ahead, when they no longer will worry of drought and contribute immensely to our GDP. High time we give this peace of mind to those who grow our food when we are sitting in five stars enjoying our meals.
I hope our respected PM Mr Narendra Modi and FM Mr Arun Jaitley might give it a thought.
This idea may have flaws as I am an ordinary person. But I am sure the team of economists with Ministry of Finance can refine it. I apologise if there is some fundamental flaw in my idea which I could not think of.
And who knows with world class irrigation and other infrastructure our farmer friends are sitting across gym table worrying weather to buy Range Rover or Mercedes   




Monday, 27 March 2017

The woman in me

A woman is a blessing of God. She is blessed with natural feelings of warmth, compassion & care. She will go every extra mile to create best for her family 

She as a Mother or daughter or wife shall always keep family first before her. Hands folded in front of almighty shall always ask for health & wealth of family before her own desires. 

And so the creator gave her this right to create. She gives birth to a soul feeling the same months before anyone sees the body. She feeds the soul with a part of her & forgoes her ambitions. Family dreams & fortunes are now her dreams. 

While all this is is so true recently I have seen & experienced other side of this. I might be wrong but these are only my feelings & nothing to hurt others. 

For this my small background. When I joined CA I was one of rare females. Travelling in crowded blue line buses to third class trains. Using toilet meant for Man as most offices did not have separate to taking on eve teasers on road coming back late at night after audits. 

The blog will go very long so just bullets as food for thought for other perspective on my own gender 

  • Surprised these days a woman complaints of office harassment months & years after incidents. Raises serious doubts on credibility. Why not immediate??

  • Use laws in her favour & section 49 A to manipulate in laws & partner & extract maximum benefits 

  • Eve teasing has been made a big issue. But I ask the woman brigade don't they admire guys & sometimes message them to be friends with them?? 

  • A woman would dress up to be complimented by everyone including men ( most important). But if her husband compliments another lady then he is a casanova 

  • She shall want all space in her life & if the partner ask her questions he is termed as outdated. But if she does that then that's her right 

  • She will sacrifice her carrier & pleasures for her kids. But equally burden them later with emotional black mail & guilt. Poor child. When did he ask you to do all this for him?

  • If a woman flirts with a man she is modern & liberated but if a man does the same he is shame on society. 

  • They will fast on their own will for long life & happiness of their husbands. But equally burden the poor guy for inconvenience she is feeling. Then why fast? Did he force you?

  • She will claim equality but shall be quick to grab ladies seat in Metro or quota in jobs. 

  • Getting into live in relationships knowing consequences very well but then take up to law if the relationship fails. Was she forced at gunpoint for live in?

  • Marital rape if woman not ready for the Act. What if it is other way round? If man doesn't want to? Does he have guts to say no. Or he will be dragged to court as impotent. 

Wake up such liberated women. Liberation is in mind not on media. When you are doing things for your family they are for your happiness not their 

Didn't you feel happy holding your new born. To be around him. Seeing him grow up. His smiles experiencing his heart beat. 

But then try to claim ownership on their better half & children is uncalled for. Let this relationship be unconditional. Stop burdening your children with guilt if they decide to fly away from your nest. 

Please stop emotional & mental torture of your partners in name of possessiveness & love. Trust them. Let not your insecurities make them run away from you. 

Is there any point that your partner is physically with you but emotionally with someone else. How beautiful it will be if it is other way round 

Stop looking for short term fame by going to media on small issues. Fight for yourself. If you consider yourself equal then prove it 

Consider your kids as souls you got into this world. Let them decide their journey. Just be their guide & mentor. Someone they can look up to. No conditions imposed. 

These are my thoughts & nothing to demean anyone. 

I love myself to be born as woman. 

Saturday, 18 March 2017

NPS a different perspective


The contributory pension system was notified by the Government of India on 22 December 2003, now named the National Pension System (NPS) with effect from 1 January 2004. The NPS was subsequently extended to all citizens of the country with effect from 1 May 2009, including self-employed professionals and others in the unorganised sector on a voluntary basis.



  • Tier I :The primary account, which is a pension account which has restrictions on withdrawals and utilisation of accumulated corpus. All the tax breaks that NPS offers are applicable only to Tier I accounts.
  • Tier II: In order to introduce some liquidity to the scheme, the PFRDA allows for a Tier II account where subscribers with pre-existing Tier I accounts can deposit and withdrawn monies as and when they want. NPS Tier II is an investment account, similar to a mutual fund in characteristics.


  • The subscribers can choose between 8 Fund Managers namely-
    1. ICICI Prudential Pension Fund Management Co. Ltd.
    2. HDFC Pension Management Co. Ltd.
    3. Kotak Mahindra Pension Fund Ltd.
    4. LIC Pension Fund Ltd.
    5. Reliance Capital Pension Fund Ltd.
    6. SBI Pension Funds Pvt. Ltd
    7. UTI Retirement Solutions Ltd
    8. Pension Fund (PF) to be incorporated by Birla Sunlife Insurance Co. Ltd One Fund Manager must compulsorily be selected.
  • A subscriber must choose between active choice and auto choice for distribution of his contribution. If active choice is selected, the subscriber must indicate the percentage distribution between corporate, gilt and equity. The maximum investment allowed in equity is 50%.
To make the NPS more attractive for subscribers, PFRDA has introduced several new features, including an Aggressive Life Cycle Fund (LC-75) which allows subscribers equity exposure of up to 75% till 35 years of age. It will be brought down by 4% per annum till 45 years, 3% from 45 to 50, and by 1% from 50 to 55 years. A major complaint against the NPS is the fact that while you get tax benefits during accumulation, the final corpus is taxed. In response, the government made 40% of the accumulate .. 

The existing provision of section 10(12A)of the Income Tax Act, 1961 provides that payment from National Pension System (NPS) to a subscriber on closure of his account or opting out shall be exempt up to 40% of total corpus at the time of withdrawal. The amount utilised for purchase of annuity is also tax exempt. However annuity received as pension is taxed.At the time of normal exit, 40% of the total corpus is mandatorily required to be purchased for annuity. The subscriber has the option to use higher amount for purchase of annuity.


Above are salient features of NPS in brief. Now the main question that I am confronted with as a financial advisor. Should i go for NPS.


I shall present few facts and leave on your wisdom to decide if to go for same.

Now since I shall only discuss on TIER 1 which has tax exemption I shall give you real time example.

Table 1 considers that investment made in NPS of 50,000 and saved Rs 15000 every year for next twenty years


Table 2 considers that tax payer opted out of NPS and paid Rs 15000 tax left with Rs 35000 for next 20 years

Table 1 gives you return of NPS for past five years
Table 2 gives you return of mutual funds for same period




* returns of NPS taken as highest as per value research by UTI for past five years as average
* returns of mutual funds taken on lower side as few have given higher returns as well
* Age at time of opting for NPS is taken as 40 years

Now below Table gives you clear taxation and withdrawal post maturity at age of sixty







* For the purpose age of investor has been taken as 40 years and period of investment 20 years
* The same does not consider any other IT relief the person shall enjoy under 80C for simplicity

Check the corpus accumulated in both the options.

Clearly if someone opts for scheme I which has equity and compare same to equity mutual funds the difference is large. Also Equity mutual fund shall be completely tax free and liquid. 

Even if someone opts for Government securities and corporate bonds the fund may be lower as per MF returns but the entire corpus shall be taxed as long term capital gain hence tax free after indexation

NPS is a beautiful scheme where the cost of management is very low and is discipline approach to investments. However the same has failed to pick up as it should have. Honestly I who knows about finance has never thought of this scheme.

My rationale for not opting for same:




  • Just to save Rs 15,000 every year why should I block my money till I am 60 years old?

  • When I have similar option in Equity mutual funds where I can register SIP till time I am 60 years why this?

  • At maturity I might want to spend my entire corpus on buying a Property, Holiday and may not like to get struck with 6% p.a annuity on 60% of my fund

  • On annuity received I again pay taxes and hence left with further lower returns

  • Why not I start a systematic withdrawal plan of my corpus in equity which shall be completely tax free


Few of my investors wanted to know if they should transfer their current PPF to NPS. My analysis says PPF currently has lock in of 15 years with guaranteed return of 8% tax free. If you check NPS returns of non equity funds it is close to 10% which is part taxable. 8% tax free is almost similar to 11% taxable. Then why block your funds till age of 60

How can NPS lure more investors


  • Give option of 100% equity fund which shall attract younger investors and a choice to get good returns by staying in Equity for long
  • Make entire corpus at the end of NPS maturity completely tax free
  • The tax payer be given option to buy annuity or withdraw complete amount as he feels fine
  • Although the new finance Act has given staggered withdrawal option of 20% over few years the same is also taxable
  • Money back option at regular intervals be made optional post few years which should be tax free.
  •  Cheap or interest free loans be granted against NPS as NPS is safest collateral government can ever have


Respected Arun Jaitley Sir I have no intention to put NPS in bad light but as my duty as financial advisor it is my duty to present facts to citizens.

I hope you shall consider above recommendation to bring benefits of NPS to larger section of society as it is a great scheme but with few drawbacks. A scheme just to save tax but not flexible at end of tenure may not go well with country from majority of population working is young














Sunday, 5 March 2017

Mother 's appeal to our PM

Respected Prime Minister Narendra Modi

Toady I am not writing as a professional or Citizen  This is the voice of an emotional mother in Delhi 

2015 Delhi elections I did may best to convince people to vote for you. But I guess false promises, money and bottle of liquor has more weightage in this country than true work. The result which I was fearing. Aam Aadmi Party, the worst party ever in history of this country won with huge majority.

Being born and brought up in Delhi I have a huge emotional connect to the city. My education and professional upsurge is all for this city. I still remember those peaceful and happy moments in Delhi University outside Shri Ram College of Commerce. I used to come late at nights  after my audits travelling DTC busses with no scare. 

That jogging through the streets and going for picnics in open air. Sitting outside at tea stall and having tea not worried about pollution and health

I am a mother now. Delhi is no more proud capital. Every kid is suffering from allergies and pollution. Our kids are already smoking 8 cigarettes without even touching tobacco. There are traffic jams and pollution all around. Hawker and three wheelers have all rights to occupy roads. The inner circle of connaught place is filled with hawkers and trash all around

My doctor says the children need to have more physical workout and yoga. But where? Even he has no answers. Just check around how many people have resorted to exercise inside closed doors than to expose themselves to this killing air.  While we have options to install air purifiers at home what about schools?

Every three months there is a threat of swine flu, Dengue, or chickenguinea.

Our Chief Minister Arvind Kejriwal is busy in getting himself heal at Bangalore. But can all of us afford this much time and money?

He is busy campaigning for elections in other states and questioning Army on surgical strikes. He is busy on twitter abusing you and BJP. My house maid has to wake up at 4 at her home as water supply is only from 4AM to 5 AM. 

And we are grasping for breath in traffic jams all we hear on radio is lies by this party for what all they have done.

I do not understand politics but one am sure of one thing. My only option now shall be shift out of this city or may be country. I know it shall be only my loss but am left with no other options. We cannot let our kids breathe this air and do permanent damage to their lungs and immunity system .

India will do very well in economic terms and I am sure will be a world leader. But what will I do with high growth numbers when most of my time is wasted in visiting doctors or fighting the system. I am writing this cause I have lost all hope. I have no expectation from this current AAM Aadmi Part government. 

They are here for their own agenda. And I can tell you if elections in Delhi are held again they will win again. They are slowly converting Delhi to slum capital and their vote bank shall remain intact. It will be too late when people will realise what blunder they committed.

With tears in my eyes i request you with folded hands please look at us in Delhi. Most of families have already moved out and many thinking on same lines. Health is most important to everyone. 

I hope you shall understand my pain and pain of most other mothers whose kids now no more go out to play grounds. Their childhood is lost and youth at risk

PLEASE HELP. Only you can help else I shall have to part with my childhood and find memories of this city

RENUKA JAIN