Deferred Tax Asset and Deferred Tax Liability

Introduction AS 22 Accounting for Taxes on Income

Accounting Standard 22 has been prescribed by ICAI to be applied in accounting for taxes on income. This AS is applied to match the differences between accounting income and taxable income.

I. Accounting income is the net profit before tax for a period, as reported in profit and loss statement

II. Taxable income is the income on which income tax is payable, computed by applying provisions of the Income Tax Act, 1961 & Rules

Why will difference appear

There can be differences between accounting income and taxable income because of the following few reasons :

• Expenses debited in profit and loss statement but disallowed as per Income-Tax Act 1961 while computing taxable income
• Provision for Bad/doubtful debts allowed while computing accounting income but disallowed while computing taxable income
• Charging depreciation using different rates as per Companies Act 2013 and Income Tax Act 1961
• Any income recognized on accrual basis in profit and loss statement but recognized on receipt basis in subsequent period for computing taxable income

In order to mitigate these kinds of differences, AS 22 needs to be applied.

The differences can be of two types:

1. Timing difference: Timing differences are those differences between accounting income and taxable income which can be reversed in one or more subsequent periods. For example, Depreciation allowed as per WDV method for computing taxable income and as per SLM method for computing accounting income.

2. Permanent difference: Permanent differences are those differences between accounting income and taxable income which cannot be reversed any subsequent period. For example, Donation paid in cash is disallowed in computing taxable income whereas it is allowed as expenditure while computing accounting income.

When to apply AS 22 Accounting for Taxes on Income

AS 22 needs to be applied when there is the difference between taxable income and accounting income. If taxable income is greater than accounting income then it will result in deferred tax asset and if accounting income is greater than taxable income then it will result in deferred tax liability.

When the difference is resulting in deferred tax asset then it should be recognized only when there is a reasonable certainty of its realization. The recognition of deferred tax asset should be to the extent of the reasonable certainty of the expected realization. The reasonable certainty can be determined by making the realistic estimates of future profits based on the examination of profits and loss statement of earlier periods.

When an entity has unabsorbed depreciation or carry forward of losses then in such a case deferred tax asset should be recognized to the extent there is a virtual certainty supported by convincing evidence. Virtual certainty is a matter of judgment of convincing evidence, which should be available in a concrete form at a particular date.

How to apply AS 22 Accounting for Taxes on Income

The application of AS 22 can be explained with the help of examples:

Example of timing difference:

Particulars	Year 1	Year 2	Year 3
Profit before tax (A)	100,000	200,000	180,000
Depreciation as per Companies Act (B)	-25,000	-25,000	-25,000
Accounting income (A-B)	75,000	175,000	125,000
Depreciation as per Income tax Act (C)	-50,000	0	-10,000
Taxable income (A-C)	50,000	200,000	170,000
Current tax @ 30%	-15,000	-60,000	-51,000
Deferred tax	-7,500	7,500	4,500
Total tax expense	-22,500	-52,500	-46,500
Profit after tax	52,500	122,500	78,500

Deferred tax computation

Particulars	Year 1	Year 2	Year 3
Opening balance of timing difference	0	25,000	0
Addition	25,000	0	15,000
Deletion	0	25,000	0
Closing balance of timing difference	25,000	0	15,000
Deferred tax @ 30%	7,500	7,500	4,500
DTA/DTL	Creation of DTL	Reversal of DTL	Creation of    DTA
Journal Entry	P&L A/c            Dr. To DTL	DTL                   Dr. To P&L A/c	DTA      Dr. To P&L A/c

Comparison between AS 22 and IND AS 12

Basis	AS 22 Accounting for Taxes on Income	IND AS 12 (Income taxes)
Recognition	AS 22 recognized tax effect of differences between taxable income and accounting income.	IND AS 12 recognized tax effect of differences between assets and/or liabilities and their tax base.
Approach	AS 22 is based on profit or loss statement approach.	IND AS 12 is based on balance sheet approach.
Differences	The types of differences on which AS 22 is applied are timing differences and permanent differences.	The types of differences on which IND AS 12 is applied are taxable temporary differences and deductible temporary differences. Permanent differences are not dealt in by this standard.
Recognition of Deferred tax asset/deductible temporary differences	DTA is recognized only when and to the extent there is a reasonable certainty of its realization	Deductible temporary differences are recognized to the extent of the probability of taxable profits in future periods.
Disclosure	AS 22 deals with the disclosure of DTA/DTL in the balance sheet.	IND AS 12 deals with the recognition of current or deferred tax as income or expense in profit and loss statement. It also deals with the disclosure of out of profit and loss transaction in the balance sheet as current or non-current assets/liability.
Revaluation of assets	AS 22 does not cover the difference arising between taxable income and accounting income due to the revaluation of assets.	IND AS 12 deals with the difference between carrying the amount of revalued asset and its tax base.
Goodwill	AS 22 does not cover the difference arising due to goodwill arising a business combination.	As per IND AS 12, the difference between carrying the amount of goodwill and its tax base (which will be NIL) is the taxable temporary difference. It does not allow the recognition of such difference because goodwill is measured as a residual and its recognition would increase the carrying amount of goodwill.
The concept of virtual certainty	When an entity has unabsorbed depreciation or carry forward of losses then in such a case deferred tax asset should be to the extent there is a virtual certainty supported by convincing evidence.	There is no concept of virtual certainty in IND AS 12. Deductible temporary differences are recognized to the extent of the probability of taxable profits in future periods.
Tax holiday	AS 22 specifically provides guidance regarding recognition of deferred tax in the situations of Tax Holiday under Sections 80-IA, 80-IB, 10A and 10B of Income-tax Act.	IND AS 12 does not specifically deal with the situations of the tax holiday.
Capital Loss	AS 22 provides guidance regarding recognition of DTA in case of loss under the head of ‘capital gains’	IND AS 12 does not specifically provide for the same.

IFRIC 23

IFRIC 23 also provides for Uncertainty over Income Tax Treatments. It requires an entity to treat uncertain tax treatments depending on which method will be best suited for its resolution. The major difference between AS 22 and IFRIC 23 is that IFRIC 23 requires an entity, while determining the current and deferred income tax assets and liabilities, to make an assessment whether it is probable that taxation authority will accept an uncertain tax treatment. If it is not probable, then entity should reflect that uncertainty through either expected value approach or most likely approach.

IFRIC 23 will be applicable for annual reporting periods beginning on or after 01.01.2019.

Current Affairs on August 19th 2018

Today's Headlines from www:

*Economic Times*

📝 Alibaba eyes joint venture with big Indian companies; in talks with RIL, Tatas, Future Retail

📝 Banks have to be more proactive in identifying risk: RBI

📝 Agri households’ average earnings grew to over Rs 1 lakh in FY16

📝 Government ropes in PSUs to undertake skilling

📝 UIDAI announces phased rollout of face authentication with telcos from September 15

📝 Steps being taken to stop cotton contamination: CCI

📝 Financial distress in India's thermal power sector

*Business Standard*

📝 Rupee might stabilise at 68-69 a dollar: Economic Affairs Secretary Garg

📝 Prime Venture plans to invest in start-ups working in logistics, SaaS

📝 Quest Global may spend $200 mn in making large acquisition, plans expansion

📝 Public sector insurers lose market share to merger plan delay: Irdai data

📝 Demand for co-working space is set to see three-fold rise by 2020

📝 Gold import seen shrinking 15% in 2018, despite festive jewellery push

📝 Banks set to get data rich with UPI 2.0; likely to boost credit scoring

*Financial Express*

📝 IT ministry norms to check fake news soon

📝 NBCC, HUDCO: Government may sell 10% via OFS route

📝 Bankruptcy: Government hints at new law for registered valuers

📝 Elon Musk’s reveals grand plan: Tesla to produce electric cars priced just $25,000

📝 Massive affordable housing boost! Government plans to sanction 75 lakh houses before March 2019 under PMAY-U

*Mint*

📝 Walmart completes deal to buy Flipkart for $16 billion

📝 L&T to consider share buyback on August 23

📝 Amazon, Facebook, Microsoft, Amex, others plan to fight data localisation plans

📝 Infosys CFO Ranganath resigns, deputy may replace him

Volkswagen CEO knew about emissions software months before scandal.

RTI Quiz Programme ( Questions)

 RTI Quiz Programme ( Questions)
1 The Right to Information is associated with which fundamental right?
 2 When did the Right to Information Act come in to force?
3 Name the State where the RTI Act is not applicable?
4 Name three objectives of the RTI Act?
5 Which officer in the Public authority provides information?
6 Within what time should the information be provided in normal cases?
7 When an application is received through the A. P. I. O, what is the time limit for Providing information?
8 Within what time should the information be provided in case of a matter of life and Personal liberty?
 9 What can you do if information is denied or not provided?
 10 What can you do if the first appeal is not effective?
 11 What is the request fee for getting information?
12 Who are exempted from fees?
13 How request fees should be remitted?(mention any two method?
14 What is the fee(cost) when information is sought in A4 paper?
 15 What is the fee prescribed for the examination of documents?
16 What is the fees for getting C D or floppy?
17 What is the fee for filing appeal?
18 What is the punishment for non production of information?
19 Within what time the first appeal should be filed?
 20 Within what time the second appeal should be filed?
21 What is the procedure if the information sought is in the custody of another Public authority?
 22 Who constitutes the Central Chief Information Commission?
23 Who appoints the Central Chief Information Commissioner?
 24 Who appoints the State Information Commissioner?
25 Who is the Central Chief Information Commissioner?
26 How many members are there in the Information Commission of Kerala?
 27 Who is the Chief Information Commissioner of Kerala?
28 What are the names of other members?
 29 Place where the State Information Commission s office is located?
30 The Act which is reduced in power after the passing of the RTI Act?
State whether the following statements are true or false
31 You are required to provide the reasons for asking information.
32 Instead of written information, the applicant can request for personal examination of documents. 33 Oral request is sufficient to seek information
34 A portion of the information cannot be given.
35 Information relating to cabinet papers should be given to citizens on request.
36 The PIO can reject your request for disclosure of information involving an infringement of copyright subsisting in a person other than the State.
37 You can request for more than one information in a single application.
 38 The R TI Act is not applicable to the High Court and Supreme Court.
 39 A Govt. Employee cannot seek information from his own Department.
40 Only citizens of India can seek information.

Key
 1 Freedom of speech and expression.
2 12 th
 October 2005. 3 Jammu and Kashmir 4 Transparency, Accountability, openness, eliminate corruption (responsibility) 5 Public Information Officer (P. I. O ) 6 30 days from the date of application. 7 35 days. 8 48 hours 9 Appeal to the appellate authority / complain to the information commission 10 2
nd
 Appeal to the State Information Commission
 II ROUND
 11 Rs. 10 12 Those who are below poverty line. 13 (1) Court fees stamp, treasury chellan, receipt from P.I. O./A.P I. O, (2) D.D, Bankers cheque, pay order 14 Rs. 2. Per page. 15 For the first one hour no fees. Rs 10 for the next 30 minutes and its fraction. 16 Rs. 50 17 No fees 18 Rs. 250 to 25000 in addition to departmental inquiry and disciplinary proceedings 19 30 days from the decision of the PIO. Relaxed in exceptional cases 20 90 days
 III ROUND
21 The P. I. O. should send the application or relevant portion to that public authority within five days. He should also inform the applicant. 22 The Central Govt. 23 The President of India. 24 The Governor 25 Vajahat Habeebulla 26 4 including the Chief Information Commissioner. 27 Sri. Palat Mohan das 28 V. V. Giri, P. N. Vijayakumar, Dr. Rajagopal 29 Punnan road Tvpm. 30 The Official Secrets Act 1923
lV ROUND
32 False 32 True 33 False 34 False 35 False 36 True 37 True 38 False 39 False 40 True

Right To Information Act 2005 And Public Records Act 1993

The Right to Information Act, 2005 (RTI Act, 2005) has provided for certain obligations that every “Public Authority” is required to fulfill. All Government Departments, including NAI, are Public Authorities within the meaning of Section 2(h) of the RTI Act, 2005.

Section 2(h) of the RTI Act, 2005 provides that “Public Authority” means any authority or body or institution of self-government established or constituted- (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed or (ii) non-Government organisation substantially financed, directly or indirectly by funds provided by the appropriate Government.

This “Research Report” briefly outlines those responsibilities of NAI vis-à vis RTI Act, 2005.

Section 2 of the RTI Act, 2005 provides that unless the context otherwise requires-

(i) “Information” means any material in any form, including records, documents, memos, e-mails, opinions, advices, press releases, circulars, orders, logbooks, contracts, reports, papers, samples, models, data material held in any electronic form and information relating to any private body which can be accessed by a public authority under any other law for the time being in force.

NAI would be required to provide “Information” to the information seekers who have made an RTI Application.

(ii) “Record” includes-

(a) Any document, manuscript and file;

(b) Any microfilm, microfiche and facsimile copy of a document;

(c) Any reproduction of image or images embodied in such microfilm (whether enlarged or not); and

(d) Any other material produced by a computer or any other device.

The definition of “Public Records” U/S 2(e) of Public Records Act, 1993 (PRA 1993) is almost identical with the definition of Records under the RTI Act 2005. These Records can be sough under the RTI Act, 2005 as “Information” through RTI Application.

(iii) “Right to information” means the right to information accessible under this Act which is held by or under the control of any public authority and includes the right to-

(i) Inspection of work, documents, records;

(ii) Taking notes, extracts or certified copies of documents or records;

(iii) Taking certified samples of material;

(iv) Obtaining information in the form of diskettes, floppies, tapes, video cassettes or in any other electronic mode or through printouts where such information is stored in a computer or in any other device.

(iv) “Third party” means a person other than the citizen making a request for information and includes a public authority.

Section 3 of the RTI Act, 2005 provides that subject to the provisions of this Act, all citizens shall have the right to information.

Section 4(1) of the RTI Act, 2005 provides that every public authority shall-

(a) Maintain all its records duly catalogued and indexed in a manner and the form which facilitates the right to information under this Act and ensure that all records that are appropriate to be computerised are, within a reasonable time and subject to availability of resources, computerised and connected through a network all over the country on different systems so that access to such records is facilitated;

With laws like the proposed Electronic Services Delivery Bill, 2011 the requirements to computerise Records and Public Records of NAI would become almost mandatory. We at Perry4Law and Perry4Law Techno Legal Base (PTLB) strongly recommend initiation of Digitilisation and Digital Preservation Initiatives by NAI as soon as possible.

The provisions of Information Technology Act, 2000 would also apply to the initiatives of NAI. Further, provisions regarding Digitilisation and Digital Preservation must be incorporated in the proposed Amendments in the Public Records Act, 1993 itself.

(b) Publish within one hundred and twenty days from the enactment of this Act,-

(i) The particulars of its organisation, functions and duties;

(ii) The powers and duties of its officers and employees;

(iii) The procedure followed in the decision making process, including channels of supervision and accountability;

(iv) The norms set by it for the discharge of its functions;

(v) The rules, regulations, instructions, manuals and records, held by it or under its control or used by its employees for discharging its functions;

(vi) A statement of the categories of documents that are held by it or under its control;

(vii) The particulars of any arrangement that exists for consultation with, or representation by, the members of the public in relation to the formulation of its policy or implementation thereof;

(viii) A statement of the boards, councils, committees and other bodies consisting of two or more persons constituted as its part or for the purpose of its advice, and as to whether meetings of those boards, councils, committees and other bodies are open to the public, or the minutes of such meetings are accessible for public;

(ix) A directory of its officers and employees;

(x) The monthly remuneration received by each of its officers and employees, including the system of compensation as provided in its regulations;

(xi) The budget allocated to each of its agency, indicating the particulars of all plans, proposed expenditures and reports on disbursements made;

(xii) The manner of execution of subsidy programmes, including the amounts allocated and the details of beneficiaries of such programmes;

(xiii) Particulars of recipients of concessions, permits or authorisations granted by it;

(xiv) Details in respect of the information, available to or held by it, reduced in an electronic form;

(xv) The particulars of facilities available to citizens for obtaining information, including the working hours of a library or reading room, if maintained for public use;

(xvi) The names, designations and other particulars of the Public Information Officers;

(xvii) Such other information as may be prescribed; and thereafter update these publications every year.

These are very wide mandates especially the one created by clause (xiv) that requires NAI to provide details in respect of the information, available to or held by it, and reduced in an electronic form.

(c) Publish all relevant facts while formulating important policies or announcing the decisions which affect public;

(d) Provide reasons for its administrative or quasi-judicial decisions to affected persons. Section 4(2) of the RTI Act, 2005 provides that it shall be a constant endeavour of every public authority to take steps in accordance with the requirements of clause (b) of sub section (1) to provide as much information suo motu to the public at regular intervals through various means of communications, including internet, so that the public have minimum resort to the use of this Act to obtain information.

Again the desirability to adopt Digitilisation of Records and Public records by NAI is clear from Section 4(2) of RTI Act, 2005.

Section 4(3) of the RTI Act, 2005 provides that for the purposes of sub-section (1), every information shall be disseminated widely and in such form and manner which is easily accessible to the public.

Section 4(4) of the RTI Act, 2005 provides that all materials shall be disseminated taking into consideration the cost effectiveness, local language and the most effective method of communication in that local area and the information should be easily accessible, to the extent possible in electronic format with the Central Public Information Officer or State

Public Information Officer, as the case may be, available free or at such cost of the medium or the print cost price as may be prescribed.

The Explanation to Section 4 of RTI Act, 2005 provides that for the purposes of subsections (3) and (4), “disseminated” means making known or communicated the information to the public through notice boards, newspapers, public announcements, media broadcasts, the internet or any other means, including inspection of offices of any public authority.

Section 6 (1) of the RTI Act, 2005 provides that a person, who desires to obtain any information under this Act, shall make a request in writing or through electronic means in

English or Hindi or in the official language of the area in which the application is being made, accompanying such fee as may be prescribed, to the appropriate officer.

An RTI Application can also be made through E-Mail, Fax or any other Electronic means. Thus, NAI must keep in place a “System” and “Procedure” for dealing with Electronic Records and Electronic RTI Applications.

Section 8 (1) of the RTI Act, 2005 provides that notwithstanding anything contained in this Act, there shall be no obligation to give any citizen,-

(a) Information, disclosure of which would prejudicially affect the sovereignty and integrity of India, the security, strategic, scientific or economic interests of the State, relation with foreign State or lead to incitement of an offence;

(b) Information which has been expressly forbidden to be published by any court of law or tribunal or the disclosure of which may constitute contempt of court;

(c) Information, the disclosure of which would cause a breach of privilege of Parliament or the State Legislature;

(d) Information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information;

(e) Information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information;

(f) Information received in confidence from foreign Government;

(g) Information, the disclosure of which would endanger the life or physical safety of any person or identify the source of information or assistance given in confidence for law enforcement or security purposes;

(h) Information which would impede the process of investigation or apprehension or prosecution of offenders;

(i) Cabinet papers including records of deliberations of the Council of Ministers, Secretaries and other officers:

Provided that the decisions of Council of Ministers, the reasons thereof, and the material on the basis of which the decisions were taken shall be made public after the decision has been taken, and the matter is complete, or over:

Provided further that those matters which come under the exemptions specified in this section shall not be disclosed;

(j) Information which relates to personal information the disclosure of which has no relationship to any public activity or interest, or which would cause unwarranted invasion of the privacy of the individual unless the Central Public Information Officer or the State

Public Information Officer or the appellate authority, as the case may be, is satisfied that the larger public interest justifies the disclosure of such information:

Provided that the information which cannot be denied to the Parliament or a State Legislature shall not be denied to any person.

Section 8(1) of the RTI Act, 2005 outlines the “Grounds” on which NAI can “Refuse” to give Information about Records and Public Records to an RTI Applicant. By virtue of Section 22 of the RTI Act, 2005, these are the “Only Grounds” subject to which NAI can refuse information to RTI Applicants.

The grounds mentioned in the Public Records Act, 1993 would no more be relevant after the passing of the RTI Act, 2005. The proposed amendments in the Public Records Act, 1993 must add the “Grounds and Exemptions” that NAI wishes to add in addition to the one mentioned by RTI Act, 2005.

Section 8 (2) of the RTI Act, 2005 provides that notwithstanding anything in the Official Secrets Act, 1923 nor any of the exemptions permissible in accordance with sub-section (1), a public authority may allow access to information, if public interest in disclosure outweighs the harm to the protected interests.

Section 8 (3) of the RTI Act, 2005 provides that subject to the provisions of clauses (a), (c) and (i) of sub-section (1), any information relating to any occurrence, event or matter which has taken place, occurred or happened twenty years before the date on which any request is made under Section 6 shall be provided to any person making a request under that section:

Provided that where any question arises as to the date from which the said period of twenty years has to be computed, the decision of the Central Government shall be final, subject to the usual appeals provided for in this Act.

The 20 years period is in conformity with the proposed amendments suggested by the Consultation Committee of NAI formulated to suggest Amendments in the PRA 1993.

Section 9 of the RTI Act, 2005 provides that without prejudice to the provisions of section 8, a Central Public Information Officer or a State Public Information Officer, as the case may be, may reject a request for information where such a request for providing access would involve an infringement of Copyright subsisting in a person other than the State.

Section 10(1) of the RTI Act, 2005 provides that where a request for access to information is rejected on the ground that it is in relation to information which is exempt from disclosure, then, notwithstanding anything contained in this Act, access may be provided to that part of the record which does not contain any information which is exempt from disclosure under this Act and which can reasonably be severed from any part that contains exempt information.

NAI can provide “Partial Access” to its Records and Public Records.

Section 10 (2) of the RTI Act, 2005 provides that where access is granted to a part of the record under sub-section (1), the Central Public Information Officer or State Public Information Officer, as the case may be, shall give a notice to the applicant, informing-

(a) That only part of the record requested, after severance of the record containing information which is exempt from disclosure, is being provided;

(b) The reasons for the decision, including any findings on any material question of fact, referring to the material on which those findings were based;

(c) The name and designation of the person giving the decision;

(d) The details of the fees calculated by him or her and the amount of fee which the applicant is required to deposit; and

(e) His or her rights with respect to review of the decision regarding non-disclosure of part of the information, the amount of fee charged or the form of access provided, including the particulars of the senior officer specified under sub-section (1) of section 19 or the Central Information Commission or the State Information Commission, as the case may be, time limit, process and any other form of access.

Section 11(1) of the RTI Act, 2005 provides that where a Central Public Information Officer or a State Public Information Officer, as the case may be, intends to disclose any information or record, or part thereof on a request made under this Act, which relates to or has been supplied by a third party and has been treated as confidential by that third party, the Central Public Information Officer or State Public Information Officer, as the case may be, shall, within five days from the receipt of the request, give a written notice to such third party of the request and of the fact that the Central Public Information Officer or State Public Information Officer, as the case may be, intends to disclose the information or record, or part thereof, and invite the third party to make a submission in writing or orally, regarding whether the information should be disclosed, and such submission of the third party shall be kept in view while taking a decision about disclosure of information:

Provided that except in the case of trade or commercial secrets protected by law, disclosure may be allowed if the public interest in disclosure outweighs in importance any possible harm or injury to the interests of such third party.

NAI receives many Archives, Records, Books, etc by way of Gifts and otherwise by Third Parties. Such Records, etc must be given subject to the provisions of this Clause or to the Terms and Conditions subject to which they have been given to the NAI by such Third Parties. .

Section 11(2) of the RTI Act, 2005 provides that where a notice is served by the Central Public Information Officer or State Public Information Officer, as the case may be, under sub-section (1) to a third party in respect of any information or record or part thereof, the third party shall, within ten days from the date of receipt of such notice, be given the opportunity to make representation against the proposed disclosure.

Section 11(3) of the RTI Act, 2005 provides that notwithstanding anything contained in Section 7, the Central Public Information Officer or State Public Information Officer, as the case may be, shall, within forty days after receipt of the request under Section 6, if the third party has been given an opportunity to make representation under sub-section (2), make a decision as to whether or not to disclose the information or record or part thereof and give in writing the notice of his decision to the third party.

Section 11(4) of the RTI Act, 2005 provides that a notice given under sub-section (3) shall include a statement that the third party to whom the notice is given is entitled to prefer an appeal under section 19 against the decision.

Third Party Relationships of NAI must be suitably regulated. A sound and practical Procedure or Guidelines in this regard is desirable on the part of NAI.

Section 22 of the RTI Act, 2005 provides that the provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in the Official Secrets Act, 1923, and any other law for the time being in force or in any instrument having effect by virtue of any law other than this Act.

The RTI Act, 2005 would “Override” the provisions of Public Records Act, 1993 and its Rules by virtue of this section.

Section 24 (1) of the RTI Act, 2005 provides that nothing contained in this Act shall apply to the intelligence and security organisations specified in the Second Schedule, being organisations established by the Central Government or any information furnished by such organisations to that Government:

Provided that the information pertaining to the allegations of corruption and human rights violations shall not be excluded under this sub-section:

Provided further that in the case of information sought for is in respect of allegations of violation of human rights, the information shall only be provided after the approval of the Central Information Commission, and notwithstanding anything contained in section 7, such information shall be provided within forty-five days from the date of the receipt of request.

Section 24 (2) of the RTI Act, 2005 provides that the Central Government may, by notification in the Official Gazette, amend the Schedule by including therein any other intelligence or security organisation established by that Government or omitting therefrom any organisation already specified therein and on the publication of such notification, such organisation shall be deemed to be included in or, as the case may be, omitted from the Schedule

Bcsbi recollected on 18.08.2018

Recollected questions on memory based on CS&BCSBI ON 18Aug 2018

1. OVD not for Identy
A. Narega card
B. Rasan card
C. Pan
d. Passport
2. White Label ATM Operated by
Ans. NBFCs
3 BSBDA Small account maximum balance any time
And. 50k
4. BSBDA Small maximum withdrawal in month
10k*, 25k, 50k, 100k
5. What is not a checkpoint in Power of attorney

6 As On 2017 maximum amount awarded by Banking Ombudsman?
Ans. 20 lakhs
7. How many female members in district forum under COPTA?
Ans one
7. Right of appropriation deal under which?
Ans. Indian contract Act
8. A 15 year student minor customer doesn’t avail which facility?
Ans. Overdraft Loan
10. Deceased claim should be settled & payment within?
Ans. 15 days
11. What is the maximum period of FCNR A/C ?
Ans. 5 years
12. In core banking full form of CORE?
Ans. Centralised Online Real-time Exchange.
13. How different MSME code conduct from general banking code
A.Fair deal with customer B. Transparency
C. Letter of credit
D. Loan against gurntee

14.one customer default you call to customer, customer said you meet at restaurants near by his office for paid his dues what should collection agent do
1. Meet at restaurants
2. Ask to meet at their .home when he convenient
3. Ask to came at bank and deposit his dues
15. One customer not paid EMI collection agent call him then he Knowing her mother expired 8 day ago what collection agent to
1. Meet Thier home and condolence after ask her EMI
2. Ask for deposit her EMI
3. condolence only
 16. How many day before intimate to customer when change branch address or close Branch
Ans. 2 month ago
17.If interested rate cahnge what option to customer
Ans. Switch account without paying any revised charge within 60 days
18 Can cheque signed by pencil if all cheque written by pen
19. If Cheque amount in word rectified and initial done by issuer what should you do
1. Call to customer and verify after encash
2. Dishonored
3. Ask to presenter to take full signature on overwriting
4. Encash directly

20. Gurnishee order received 10k customer account balance 11k type of account minimum balance need 3 k how deal you
21. Income tax officer came want a customer statement how to deal you
1. Ask to take letter from appropriate authority
2. Not provided
3. Provided
22. A teacher have salary account want to know about risk category for the purpose of educate to students about risk category of customer how you deal .
23. What is benifts of good service for bank
24. What is not included in customer service rank model
1. Customer feedback
2. Complaints
3 survey
25. What impact of automation in banking due to less intra-personal relationship between Small customer or staff
1.Increse satisfaction or less complaints
Decreased satisfaction or increase complaints
26. What is means customer "delight"
27-28 Power of CFO of bcsbi 2 questions
29.Notice period for shifting branch
30.Notice period for changing interest
31 . Special crossing cheque 2 questions
32. Cheque endorsement 1 Questions
33. Maximum MSME loan without colletral
1. Retail banking covered
     1.Home loan 2. Personal loan. 3. Education loan. 4. Credit car
Ans. all 1 to 4

2. Which organisation give to allow bank’s entry in to insurance business?
Ans. RBI
3. White paper ATM CARD issued by?
Ans. NBFCs
4. What are benefits of Demat account?
   1. Easy &convenient 2. Smooth &immediate transfer 3. No stamp duty 4. Minimise paper work
Ans. All of them (1to 4)
5As On 2017 revised amount awarded by Banking Ombudsman?
Ans. 20 lakhs
6. How many female members in district forum under COPTA?
Ans one
7. If an applicant apply a Education laon of rs 3.5 lakhs margin will be?
Ans. Nil
8. Right of appropriation deal under which?
Ans. Indian contract Act
9. A minor customer doesn’t avail which facility?
Ans. Overdraft Loan
10. Deceased claim should be settled & payment within?
Ans. 15 days
11.which is not a valid OVDs for identity of customer?
Ans. Rasan card
14. What is the maximum period of FCNR A/C ?
Ans. 5 years
15. In core banking full form of CORE?
Ans. Centralised Online Real-time Exchange.

Recollected questions on memory based on BCSBI IIBF EXAM ON 18Aug 2018
16.what is universal banking?
Ans. A company offering a wide range of financial services
17.in manufacturing unit of MSEs what is minimum projected turnover for working capital?
Ans. 20%of projected annual turnover
18. CFO of BCSBI appointed by?
Ans. Governing council
19.A cross cheque has to be routed through an account with the cross named bank . Which type of crossing?
Ans. Special crossing
20.A SHG customer want to open a account. KYC document required by bank?
Ans. Kyc required only operating authority members of SHG.
21. What are the benefits of demat account?
      a.Easy &convenient way to hold securities
      b. Smooth &Immediate transfer
       c. No stamps duty
        d. Minimise your paper work
Ans. All of them (a to d)
22.facility of instant credit of out station cheque should be raised to ——-?
Ans. 5000
23. What is the instant cash payment by teller counter of the bank?
Ans. 10000
24. In Small account what is the limit of cash withdrawal during the month?
Ans. 10000
25. In small account what is minimum balance at any point of time?
Ans. Should not exceeding 50000
26.RBI set up CPPAPS. What is its evaluation?
Ans . Customer end
27.consumer forum is a ———?
Ans . Quasi judicial mechinery
28. Time schedule for disposal of complaint during——?
Ans. 21days
29. Governing council should not more than members?
   a. 3.  b. 4.  c. 5 d.6
Ans.  D 6
30. For rating the members bank which parameter is not used by BCSBI?
  a. Transparency.  b. Customer feedback
   c. Customer complaint. d. Information dissemination
Ans. c. Customer complaint

COMPANIES ACT 2013 sections

1 Short title, extent,commencement and application
2 Definitions
3 Formation of company
4 Memorandum
5 Articles
6 Act to override memorandum, articles, etc
7 Incorporation of company
8 Formation of companies with charitable objects, etc
9 Effect of registration
10 Effect of memorandum and articles
11 Commencement of business, etc
12 Registered office of company
13 Alteration of memorandum
14 Alteration of articles
15 Alteration of memorandum or articles to be noted in every copy
16 Rectification of name of company
17 Copies of memorandum, articles, etc., to be given to members
18 Conversion of companies already registered
19 Subsidiary company not to hold shares in its holding company
20 Service of documents
21 Authentication of documents, proceedings and contracts
22 Execution of bills of exchange, etc
23 Public offer and private placement
24 Power of Securities and Exchange Board to regulate issue and transfer of securities, etc
25 Document containing offer of securities for sale to be deemed prospectus
26 Matters to be stated in prospectus
27 Variation in terms of contract or objects in prospectus
28 Offer of sale of shares by certain members of company
29 Public offer of securities to be in dematerialised form
30 Advertisement of prospectus
31 Shelf prospectus
32 Red herring prospectus
33 Issue of application forms for securities
34 Criminal liability for misstatements in prospectus
35 Civil liability for misstatements in prospectus
36 Punishment for fraudulently inducing persons to invest money
37 Action by affected persons
38 Punishment for personation for acquisition, etc, of securities
39 Allotment of securities by company
40 Securities to be dealt with in stock exchanges

41 Global depository receipt
42 Offer or invitation for subscription of securities on private placement
43 Kinds of share capital
44 Nature of shares or debentures
45 Numbering of shares
46 Certificate of shares
47 Voting rights
48 Variation of shareholders' rights
49 Calls on shares of same class to be made on uniform basis
50 Company to accept unpaid share capital, although not called up
51 Payment of dividend in proportion to amount paidup
52 Application of premiums received on issue of shares
53 Prohibition on issue of shares at discount
54 Issue of sweat equity shares
55 Issue and redemption of preference shares
56 Transfer and transmission of securities
57 Punishment for personation of shareholder
58 Refusal of registration and appeal against refusal
59 Rectification of register of members
60 Publication of authorised, subscribed and paidup capital

41 Global depository receipt
42 Offer or invitation for subscription of securities on private placement
43 Kinds of share capital
44 Nature of shares or debentures
45 Numbering of shares
46 Certificate of shares
47 Voting rights
48 Variation of shareholders' rights
49 Calls on shares of same class to be made on uniform basis
50 Company to accept unpaid share capital, although not called up
51 Payment of dividend in proportion to amount paidup
52 Application of premiums received on issue of shares
53 Prohibition on issue of shares at discount
54 Issue of sweat equity shares
55 Issue and redemption of preference shares
56 Transfer and transmission of securities
57 Punishment for personation of shareholder
58 Refusal of registration and appeal against refusal
59 Rectification of register of members
60 Publication of authorised, subscribed and paidup capital

61 Power of limited company to alter its share capital
62 Further issue of share capital
63 Issue of bonus shares
64 Notice to be given to Registrar for alteration of share capital
65 Unlimited company to provide for reserve share capital on conversion into limited company
66 Reduction of share capital
67 Restrictions on purchase by company or giving of loans by it for purchase of its shares
68 Power of company to purchase its own securities
69 Transfer of certain sums to capital redemption reserve account
70 Prohibition for buyback in certain circumstances
71 Debentures
72 Power to nominate
73 Prohibition on acceptance of deposits from public
74 Repayment of deposits, etc, accepted before commencement of this Act
75 Damages for fraud
76 Acceptance of deposits from public by certain companies
77 Duty to register charges, etc
78 Application for registration of charge
79 Section 77 to apply in certain matters
80 Date of notice of charge

81 Register of charges to be kept by Registrar
82 Company to report satisfaction of charge
83 Power of Registrar to make entries of satisfaction and release in absence of intimation from company
84 Intimation of appointment of receiver or manager
85 Company's register of charges
86 Punishment for contravention
87 Rectification by Central Government in register of charges
88 Register of members, etc
89 Declaration in respect of beneficial interest in any share
90 Investigation of beneficial ownership of shares in certain cases
91 Power to close register of members or debenture holders or other security holders
92 Annual return
93 Return to be filed with Registrar in case promoters' stake changes
94 Place of keeping and inspection of registers, returns, etc
95 Registers, etc, to be evidence
96 Annual general meeting
97 Power of Tribunal to call annual general meeting
98 Power of Tribunal to call meetings of members, etc
99 Punishment for default in complying with provisions of sections 96 to 98
100 Calling of extraordinary general meeting

101 Notice of meeting
102 Statement to be annexed to notice
103 Quorum for meetings
104 Chairman of meetings
105 Proxies
106 Restriction on voting rights
107 Voting by show of hands
108 Voting through electronic means
109 Demand for poll
110 Postal ballot
111 Circulation of members' resolution
112 Representation of President and Governors in meetings
113 Representation of corporations at meeting of companies and of creditors
114 Ordinary and special resolutions
115 Resolutions requiring special notice
116 Resolutions passed at adjourned meeting
117 Resolutions and agreements to be filed
118 Minutes of proceedings of general meeting, meeting of Board of Directors and other meeting and resolutions passed by postal ballot
119 Inspection of minute books of general meeting
120 Maintenance and inspection of documents in electronic form

121 Report on annual general meeting
122 Applicability of this Chapter to One Person Company
123 Declaration of dividend
124 Unpaid Dividend Account
125 Investor Education and Protection Fund
126 Right to dividend, rights shares and bonus shares to be held in abeyance pending registration of transfer of shares
127 Punishment for failure to distribute dividends
128 Books of account, etc, to be kept by company
129 Financial statement
130 Reopening of accounts on court's or Tribunal's orders
131 Voluntary revision of financial statements or Board's report
132 Constitution of National Financial Reporting Authority
133 Central Government to prescribe accounting standards
134 Financial statement, Board's report, etc
135 Corporate Social Responsibility
136 Right of member to copies of audited financial statement
137 Copy of financial statement to be filed with Registrar
138 Internal audit
139 Appointment of auditors
140 Removal, resignation of auditor and giving of special notice

141 Eligibility, qualifications and disqualifications of auditors
142 Remuneration of auditors
143 Powers and duties of auditors and auditing standards
144 Auditor not to render certain services
145 Auditor to sign audit reports, etc
146 Auditors to attend general meeting
147 Punishment for contravention
148 Central Government to specify audit of items of cost in respect of certain companies
149 Company to have Board of Directors
150 Manner of selection of independent directors and maintenance of databank of independent directors
151 Appointment of director elected by small shareholders
152 Appointment of directors
153 Application for allotment of Director Identification Number
154 Allotment of Director Identification Number
155 Prohibition to obtain more than one Director Identification Number
156 Director to intimate Director Identification Number
157 Company to inform Director Identification Number to Registrar
158 Obligation to indicate Director Identification Number
159 Punishment for contravention
160 Right of persons other than retiring directors to stand for directorship
161 Appointment of additional director, alternate director and nominee director
162 Appointment of directors to be voted individually
163 Option to adopt principle of proportional representation for appointment of directors
164 Disqualifications for appointment of director
165 Number of directorships
166 Duties of directors
167 Vacation of office of director
168 Resignation of director
169 Removal of directors
170 Register of directors and key managerial personnel and their shareholding
171 Members' right to inspect
172 Punishment
173 Meetings of Board
174 Quorum for meetings of Board
175 Passing of resolution by circulation
176 Defects in appointment of directors not to invalidate actions taken
177 Audit Committee
178 Nomination and Remuneration Committee and Stakeholders Relationship Committee
179 Powers of Board
180 Restrictions on powers of Board

Section No. Section Name
181 Company to contribute to bona fide and charitable funds, etc
182 Prohibitions and restrictions regarding political contributions
183 Power of Board and other persons to make contributions to national defence fund, etc
184 Disclosure of interest by director
185 Loan to directors, etc
186 Loan and investment by company
187 Investments of company to be held in its own name
188 Related party transactions
189 Register of contracts or arrangements in which directors are interested
190 Restrictions on powers of BoardContract of employment with managing or wholetime directors
191 Payment to director for loss of office, etc, in connection with transfer of undertaking, property or shares

Sole , Multiple Banking Arrangement, Consortium Lending, Syndication

Sole Banking Arrangement: Sole banking arrangement is a lending by single bank to a large borrower, subject to the resources available with it and limited to the exposure limits imposed by the Reserve Bank of India. Many a times when you propose to approach to new bank for funding, they propose for sole banking that their complete banking should be transferred to their bank. This is done for two reasons one is to get complete business and second is very important is having complete monitoring of fund flow and cash flow of the firm.

 Multiple Banking Arrangement, Consortium Lending, Syndication: Multiple Banking: When the credit requirements of a borrower are beyond the capacity of a single bank or that the bank does not want to take more exposure on a particular borrower, he may then resort to multiple banking. It is an arrangement where a borrower borrows simultaneously from more than one bank independent of each other, under separate loan documents with each bank. Securities are charged to each bank separately. Remember, this is different from Consortium and Syndication

Consortium lending
Consortium lending also called joint financing or participation financing. It is a system of financial emerged due to consequential increase in demand for funds of substantial magnitude and inability of individual banks to take care of the entire fund requirement
of large borrowers. The system of consortium lending provides scope and opportunity to share risk amongst banks. The system is considered to be mutually beneficial to the banks as well as customers. Under multiple banking, there is no coordination among banks regarding appraisal, documentation, other terms and advances. In such a situation borrowers got the upper hand by playing one bank against the other. It was, therefore, necessary to formalize these credit arrangements to safeguard the interest of the banks. It is mainly catered in case of large corporate and certain mid-sized borrowers.

Syndication Lending
 Reserve Bank of India has permitted the banks to adopt syndication route to provide credit in lieu of consortium advance. A syndication credit differs from consortium advance. A syndicated credit differs from consortium advances in certain aspects.

The salient features of a syndicated credit are as follows:

 1. It is an agreement between two or more banks to provide a borrower a credit facility using common documents of the borrower.

2. The prospective borrower gives a mandate to a bank, commonly referred as a lead bank (lead manager), to arrange credit on his behalf. The mandate gives the commercial terms of the credit and the prerogatives of the mandated bank in resolving contentious issue in the course of the transaction of complete syndication.

3. The mandated bank prepares an information Memorandum about the borrower in consultation with the latter and distributes the same among st the prospective banks, inviting them to participate in the credit proposal.

What is a 'Syndicated Loan'
A syndicated loan, also known as a syndicated bank facility, is a loan offered by a group of lenders – referred to as a syndicate – who work together to provide funds for a single borrower. The borrower could be a corporation, a large project or a sovereignty, such as a government. The loan can involve a fixed amount of funds, a credit line or a combination of the two.

Dimensions of Credit Appraisals

Dimensions of Credit Appraisals
 Six ―C‖ s
1. Character
You are considered to have good credit character when you live up to your financial and credit agreements. Paying bills on time and meeting financial obligations are signs of good character. Your credit score and your credit history are good ways for a bank to learn about your character or credit reputation and how well you pay your credit obligations.

 2. Capacity Capacity reflects your ability to repay a loan or other financial agreement. Potential creditors want to see that you‘ll have enough cash left over after paying your fixed monthly expenses to repay a new credit or loan account.

 3. Capital A potential bank also will assess your capital. Wondering if you have any? Subtract all your debts from your assets, including any property that you may own, and this is your capital. Banks and creditors like to see that you have enough capital to handle another loan or credit account before approving you for new credit.

4. Conditions Banks look at conditions such as the stability of your employment, your other debts and financial obligations, and how often you‘ve moved in the past year when considering whether to approve you for a loan. The longer you‘ve been in a job and the less frequently you‘ve moved the more stable your life conditions appear to potential creditors and banks.

 5. Collateral Collateral is any property or possession that can be used as security for a payment of a debt. For example, a home or automobile serve as collateral against the loans you might take out to purchase them. Banks like collateral because it guarantees them against a total loss if you fail to repay your loan. If that happens, your collateral may be sold or repossessed to repay your financial obligation.

6. Cash Flow adequate cash flow to repay a new loan. Income in each monthAre you paid regularly, or does your income fluctuate based on seasonality or other factors? A Bank wants to make sure you have enough cash flowing your way on a regular basis so that you can pay for a new credit obligation