Among the frontliners, TCS, Wipro, Satyam, Infosys, HDFC Bank and HCL Tech have gained 6-9.5%. However, BHEL, Grasim, DLF, ACC, M&M and Unitech tumbled over 5.5-8%.

BSE FMCG Index was up by 38.59 points or 2.08% to 1,897.58. United Spirits was up by 13%. ITC, Marico and Godrej Consumer went up 2-4%.

Pharma stocks like Dr Reddys Labs, Sun Pharma, Dishman Pharma, Lupin and Aventis Pharma were up by 4-9%. Healthcare Index jumped by 1.6% or 51.47 points, to settle at 3,260.49.

Metal Index rose by 85.65 points or 1.48% to 5,887.36. SAIL, JSW Steel and Guj NRE Coke gained 4-7%. Hindalco and Tata Steel were up by 1.75-1.95%.

Oil & Gas Index gained 42.94 points or 0.66%, to close at 6,522.50. Cairn India, Aban Offshore, HPCL, Reliance Industries, Essar Oil and ONGC were gainers.

However, Realty Index tumbled 94.28 points or 3.73% to 2,430.61. Parsvnath, DLF, Omaxe, Unitech, Ansal Properties and Phoenix Mills lost 5-8%.

Power Index fell 34.05 points or 1.99% to 1,678.22. CESC, Torrent Power, Tata Power, GMR Infra, Reliance Infra and Suzlon Energy were losers.

Capital Goods index was down by 70.86 points or 0.98% to 7,170.50. BHEL fell over 8%. Kirloskar Oil, Elecon Engg, Alstom Projects, Praj Industries, Crompton Greaves, Thermax, Bharat Electronics and BEML were other losers.

Auto stocks Auto Index lost 0.87%, to close at 3,072.52. Cummins, Exide Industries, M&M, Apollo Tyres and Bharat Forge fell 3-6%. MRF and Hero Honda were other losers.

The BSE Midcap index lost 38.49 points or 1.09%, to end at 3,506.35 and the Small Cap Index fell 55.04 points or 1.32% to 4,112.82.

Among the midcap stocks, United Breweries, Core Projects, Balrampur Chini, Balaji Telefilm and Piramal Health fell 11-20%.

In the small cap space, Dynamatic Tech, Subex, Marathon Nextgen and MSK Projects lost 14-16%.

Telecom stocks like Tata Communication, MTNL and Bharti Airtel gained 4.5-6.5%. However, Idea Cellular and Reliance Communication were losers.

Sugar stocks like Renuka Sugar fell 7.5%. Balrampur Chini lost 12.4% and Bajaj Hindustan fell 9.4%, as the UP government has hiked State Advised Price (SAP) by Rs 15 to Rs 140. The UP government continued to announce SAP as against SC rule casing.

Daiichi Sankyo has acquired a 52.5% stake in India’s largest pharmaceutical company Ranbaxy Labs, after the Ranbaxy board approved preference allotment of shares and warrants to Daiichi. Daiichi Sankyo has acquired 8.19 crore shares from Ranbaxy promoters. Ranbaxy now becomes a subsidiary of Daiichi Sankyo. The stock closed at Rs 261.70, up Rs 5.50, or 2.15%.

Market breadth was weak throughout the day; about 1100 shares have advanced while 1891 shares have declined. Nearly 197 shares remained unchanged.

Total traded turnover stood at Rs 65,024.86 crore. This includes Rs 10,065.52 crore from NSE Cash segment, Rs 51,272.30 crore from NSE F&O segment and Rs 3,687.04 crore from BSE Cash segment.

Positive Asian and European markets were supportive for our markets as well. Among the Asian markets, Hang Seng went up 5.28% and Nikkei surged 3.59%. Shanghai, Straits Times, Jakarta, Kospi and Taiwan rose 2-3%.

European markets were trading higher. FTSE was up by 2.13% followed by CAC and DAX, which rose 1.72% and 1.41%, respectively.

The Dow Jones Futures was up by 191 points and the Nasdaq up by 37 points, at 4:30 pm.

Market Snapshot

RBI cuts Repo Rate by 100 bps to 8% (First Repo Rate Cut Since August 2003)

Sensex up 247 points to end at 10223, Nifty up 48 points to end at 3122

Gains led by IT stocks and Banking stocks

CNX Midcap Index down 0.36%, BSE Small-cap Index down 1.32%

BSE IT up 8%, Wipro up 9.4%, Hcl Tech up 9%, Satyam up 8.6%, TCS up 8.2%, Infosys up 7.6%

BSE Bankex up 2.6%, Hdfc Bank up 5.2%, Icici Bank up 5.1%, Canara Bank up 5.1%, BOB up 2.7%

BSE Realty down 3.7%, Dlf down 6.5%, Unitech down 5.8%, Parsvnath down 8%

Index Gainers: Sail up 6.6%, HDFC up 5.6%, Cairn up 5.3%, Bharti up 4.5%

Index Losers: Bhel down 7.8%, Acc down 5.7%, Ambuja Cement down 5.6%, M&M down 5.3%

Mid Cap Gainers: United Spirits up 13.5%, Rolta up 9.9%, Pantaloon up 8.6%, Ivrcl Infra up 7.3%

Mid Cap Losers : Core Proj down 16.3%, Balaji Tele down 11.9%, Strides Arcolab down 12%

Sugar Losers : Renuka down 7.5%, Balrampur Chini down 12.4%, Bajaj Hind down 9.4% (UP Govt continues to announce SAP as against SC rule casing))

Adv - Dec Ratio at 1:1.75

Total market turnover at Rs 65024.86 crore versus Rs 72822.47 crore

Nse F&O Turnover at Rs 51272.30 crore versus Rs 55892.72 crore

F&O Snapshot

Fresh Long build up seen in Nifty Fut, ends at a premium of 38.2 points

IT Stocks sees fresh long build up

Fresh short build up in large cap real estate stocks

Metal stock sees long build up, but CoC still negative

Options Activity:

Nifty 3100 call adds 5.3 lakh shares

Nifty 3300 call adds 3.7 lakh shares

Nifty 3200 call adds 3.1 lakh shares

Fresh Long :

IT : Infosys , Wipro , Satyam ,

Metals : Tata Steel , Sterlite Ind , Sail

Misc : Indian Bank , Chambal Fert , Can Bank , Ivrcl

Fresh Short: DLF , Unitech , Renuka

The market has ended sharply higher. Strong upmove was seen on account of repo rate cut, positive European and Asian markets and huge surge in technology stocks. Buying was also seen in banking, FMCG, pharma, metal and few oil stocks. However, realty, power, few auto and capital goods stocks were under pressure. Selling was also seen in midcap and small cap stocks.

The Sensex closed with a gain of 247.74 points or 2.48% at 10,223.09, after hitting an intraday high of 10,538.05. The NSE Nifty Fifty Index surged by 48.45 points or 1.58%, to settle at 3122.80. It has hit a high of 3238.40.

Technology stocks took a big pie in today's gain of benchmark indices. IT Index went up 204.19 points or 8.05%, to close at 2,741.46. HCL Tech, Rolta, TCS, Wipro, Satyam, Infosys, Tech Mahindra and Mphasis were up 7-10%. The Indian rupee was trading at around 48.7-49 to a dollar.

RBI's move of 100 bps repo rate cut with immediate effect has also played a key role in today's trade. The current repo rate (the rate at which banks borrow from RBI) stood at 8% from earlier 9%. This was the first repo rate cut by RBI since August 2003. RBI had already cut cash reserve ratio (CRR) by 250 bps in the last two weeks. All these moves are to increase liquidity in the banking system.

source:moneycontrol

The Reserve Bank of India, or RBI has cut the repo rate by 100 bps to 8% with immediate effect. This is the first repo cut since 2003.

The Finance Minister, P Chidambaram said that the repo rate cut will help in moderating inflation. This is a positive move which will enthuse both borrowers and investors, the FM added. The RBI’s move is consistent with the government's aim of maintaining high growth, he added.

According to officials at the Indian Overseas Bank, there is need to see the impact of this move on cost of deposits before passing it on to the consumers. There is a clear signal from the RBI to boost the economy, they said. Meanwhile, Officials at Oriental Bank have said that the repo rate cut is aimed at bringing down loan rates.

Ambareesh Baliga of Karvy Stock Broking felt the move would not have an immediate impact on stock prices. “Whatever you do for the banking system will not be enough for the markets because the markets have their own problem and that is lack of confidence,” Baliga said. “Confidence will not come just because of a CRR cut or a repo rate cut,” he added.

source: moneycontrol

Efforts to resolve the “anomalies” in the new pay scales for armed forces gained momentum with External Affairs Minister Mr.Pranab Mukherjee on Tuesday discussing the matter with Finance Minister Mr.P. Chidambaram.

Mukherjee, who is heading a three-member ministerial committee looking into the issue, held discussions with Chidambaram after holding consultations with Prime Minister Mr.Manmohan Singh.

Mr.Mukherjee and Mr.Chidambaram were together for about an hour during which they are understood to have explored ways to address the issue to the satisfaction of the forces.

The Defence Services, led by their Chiefs, are up in arms over the 6th Pay Commission recommendations, alleging that it compromised their status and honour.

Emerging from the meeting at the External Affairs Minister’s South Block office, Mr.Chidambaram refused to comment on the deliberations, saying it was his first meeting with Mr.Mukherjee on the issue.

Mr.Mukherjee yesterday said he had discussed the matter with the Prime Minister and that he hoped the issue would be settled shortly.

The committee, which also includes Mr.Antony and Mr.Chidambaram, was set up by the Prime Minister on September 25 in the wake of deep resentment in the armed forces, who complained that there were “anomalies” in the Sixth Pay Commission recommendations and that it had lowered the status of their officers.

Source: The Hindu (14-10-08)

The model code of conduct for elections may affect education minister Mr.Arjun Singh’s plans to announce a raise for university and college teachers by Diwali.

Top officials in the ministry went into a huddle today to discuss the likely delay amid fears that it could hurt the UPA in the elections.

Sources said, on October 8, Mr.Singh had asked his department to finalise the pay hikes proposed for over five lakh college and university teachers in time for Diwali.

But any announcement of a raise now may be described as a measure against the model code of conduct which is in force, officials said.

The model code came into effect when elections to five states — Delhi, Mizoram, Rajasthan, Madhya Pradesh and Chhattisgarh — were announced. It will remain in force till December 4, the last day of polling.

Mr.Singh was hauled up by the Election Commission in 2006 for promising OBC quotas in central higher education institutions just ahead of state polls that year. He is unlikely to risk a repeat, sources said.

A University Grants Commission pay panel headed by G.K. Chadha had earlier this month recommended pay hikes ranging from 75 per cent to over 100 per cent for teachers. The recommendations have been accepted by the UGC and the ministry is finalising them, the sources said.

“But now, even if we finalise the salary hikes, we will in all probability be unable to implement the raise till December 4,” a senior official said.

These concerns were debated at a late afternoon meeting of ministry officials under higher education secretary Mr.R.P. Agrawal, the sources said.

The promised raise will be valid not just for central university teachers but also for state-run colleges or universities recognised by the UGC.

Source : The Telegraph (15-10-2008)

There have been some news items on television as well as in the newspapers that most of the pay arrears will go towards payment of income tax once the employees receive the arrears. However, the government recently, has clarified its stand on the taxation of the pay arrears for the current financial year.Income tax on Pay arrears Sixth Commission
Government representative said that they would tax only 40 per cent of salary arrears to be paid to central government employees in the current fiscal on implementation of Sixth Pay Commission recommendations.The Khabrein info. writes-

Usually, the income earned in a year is taxed in that particular year, hence whatever the employees receive in this financial year woul be taxed this year. A lot of media sources reported that the entire amount of arrears would attract tax this fiscal.

As per the notification issued by the government last month, central government employees will get 40 per cent of arrears during the current financial year and the remaining amount in the next financial year.

Government instructions issued on August 30, 2008, regarding fixation of pay and payment arrears consequent to implementation of the Sixth Central Pay Commission recommendations clearly states that in authorising the arrears income tax as due may also be deducted and credited to the government

Orders issued by Governement for revision of pay scale and allowances, Pension Benefits, LTC, and other financial benefits granted to Central Government Officers consequent upon implementation of Sixth Pay Commission report can be downloaded from here

New Pay and Bonus

Revised Pay Rules - Notification (html format) Revised Pay Rules - Notification (PDF format)



New Pay and Arrears - Resolution (html format) New Pay and Arrears - Resolution (pdf format)


New Pay- Office Memorandum

Railways Revised Pay Rule - Notification

Clarification

CSIR 6CPC Report

Revised PLB and Adhoc-bonus

Allowances

Revised DA,HRA,TA

Deputation Allowance

Travelling Allowance

Family Planning Allowance

Leave

Maternity Leave

LTC

Revised LTC

As the committee headed by External Affairs Minister Pranab Mukherjee is looking into the armed forces’ grievances over their new pay scales, the army on Wednesday said any decision by the government on the issue will be for the good of the country and the Services.

“The pay anomalies issues is currently with the Cabinet and I am sure it will take care of it. Whatever it decides, it will be for the good of the country and the armed forces,” Vice-Chief of the Army, Lieutenant-General M L Naidu, said on the sidelines of an Army Postal Service Awards ceremony ihn New Delhi.

“They (the committee members) are our national leaders and they will keep all issues in mind before taking a decision. It (pay issues) is not a matter of our expectations,” Naidu said, replying to a query on the course of action the armed forces would take if all their expectations are not met by the Mukherjee committee.

Prime Minister Manmohan Singh had late last month set up the Mukherjee committee with Defence Minister A K Antony and Finance Minister P Chidambaram as members to consider the four “core issues” raised by the armed forces on what they called a “discriminatory” 6th Central Pay Commission (CPC) report.

In fact, the issues had snowballed into a controversy over the armed forces’ reluctance to implement the Cabinet decision on the CPC taken last month.

Consequently, the 1.5 million armed forces personnel took home their old pay scales in October, while their 3.5 million civilian counterparts got their revised pay scales under the CPC.

To another query, Naidu said pointing out some discrepancies in the CPC was not “defiance”, but professional duty (of the armed forces).

The armed forces are demanding that the government place Lieutenant-Colonels and their equivalents in Pay Band-4, ensure parity in Grade Pay of officers from Captains to Brigadiers with their civilian counterparts, accord the Higher Administrative Grade Plus status in pay scales to Lieutenant Generals and restore 70 per cent pensionary benefits to jawans.

To another question over the misuse of army’s combat fatigues by paramilitary and police forces, Naidu said the army had already informed the Centre and the state governments about it.

“Now, the state governments have taken very strict action, because they have realized that by not insisting on this, it is causing some confusing. Now they have done it (enforce laws against misuse of army uniforms). And hopefully it will be sorted out,” Naidu said.

Asked about the uniforms and camouflages being freely available in the open market, the army vice-chief said as far as clothes, low-quality products are concerned, they were available (but not the Army’s).

“A solution is being worked out and the Home Ministry is doing what is necessary to curb such sales. By law, sale of military uniform in the open market is banned. It should not be available. If it is, there is a separate enforcement agency working on curbing the sale of military uniform. In J&K, they are very actively curbing the sale,” he added.

There is some latest updates which came regarding the sixth pay commission about the clarifications on the Increment and Promotions of Government Employees after Jan 1st,2006. This office memorandum was released on 13th Sept,2008 on the Govt OF India website. It basically deals with some issues where the employees needed a clarification like the date of next increment. Now there will be one uniform datej1st of every year.

As per it, all the employees who got their last increment between 02.01.2005 and 01.01.2006 would be getting their increment on 01.017.2006. There are some clarifications on the method of fixation of pay on promotion after January 1st 2006. Two more issues that it deals with are fixation of pay of the govt employees who were on deputation and who got promoted in the cadre subsequently while still on deputation.The last issue deals with a procedure of placing employees in the new upgraded pay scale in case of merger of scales which were recommended by the 6th pay commission.

A complete detailed report can be found out over here: You can read the complete analysis of 6th pay commission, pay calculator and much more.

The University Grants Commission appoints a Committee to Review the Scales of Pay of the Teachers in the Universities and Colleges. The Commission in consultation with the Ministry of Human Resource Development has finalized the terms of reference of the Committee,ugc, ugc pay commission report, ugc pay commission, chadha committee report, ugc net

AIFUCTO would urge Prof. Chadha Committee to bear in mind the following broad principles while formulating its proposals for the 6th UGC pay scales for university and college teachers:

As per chadha committee report NEW UGC PACKAGE

QUALIFICATIONS

The minimum qualification required for the appointment of lecturers should remain as good academic record with 55% marks at the PG level or “B Grade” in the seven point scale where grading system is followed. The candidates should also have cleared the NET conducted by the UGC/CSIR or similar tests accredited by the UGC.

Read complete proposal UGC pay commission report
so that you can make review and make proper feedback.

UGC Pay Review Committee
Public Opinion is Invited on issues relating to UGC Pay Review Committee

Interested persons/stakeholders are invited to give their views/comments on UGC Pay Review Committee in a concise manner by fax / e-mail / correspondence to

Dr.K.C.Pathak
Joint Secretary,Pay Review Committee
University Grants Commission,
send online

Report of the UGC Committee to Review the 6th Pay Scales and Service Conditions of University and College Teachers, 2008

• Status of Various XI Plan Visiting Committees to Universities

• XI Plan Visiting Committee to Universities-Sensitization about Preventation of Ragging.

• Nomination of UGC officers for various XI Plan Visiting Committees

• UGC XI Plan Expert Visiting Committees to Universities to assess their Eleventh Plan requirement & Tenth Plan Review Performance.

Public Opinion is Invited on issues relating to UGC Pay Review Committee

Interested persons/stakeholders are invited to give their views/comments on UGC Pay Review Committee in a concise manner by fax / e-mail / correspondence to

Dr.K.C.Pathak
Joint Secretary,Pay Review Committee
University Grants Commission,
35-Ferozeshah Road
New Delhi-110001
Fax:011-23386128
Tel:011-23386128
E-mail:kcpathak@ugc.ac.in

However,the address for the correspondence of the Chairman,Pay Review Committee,Prof G.K.Chadha , may be read as follows:

Prof G.K.Chadha
Member
Economic Advisory Council to the Prime Minister & Chairman,Pay Review Committee
Room No.111 UGC Building
Bahadur Shah Zafar Marg
New Delhi-110002

Career Advancement Scheme(CAS) for Assistant Librarian/College Librarians/Assistant Director of Physical Education/College Director of Physical Education

The UGC, however, was formally established only in November 1956 as a statutory body of the Government of India through an Act of Parliament for the coordination, determination and maintenance of standards of university education in India. In order to ensure effective region-wise coverage throughout the country, the UGC has decentralised its operations by setting up six regional centres at Pune, Hyderabad, Kolkata, Bhopal, Guwahati and Bangalore. The head office of the UGC is located at Bahadur Shah Zafar Marg in New Delhi, with two additional bureaus operating from 35, Feroze Shah Road and the South Campus of University of Delhi as well.
Model Guidelines for Re-employment of superannuated Teachers.[click here]

»	Family Planning Allowance
»	Caretaking Allowance
»	Travelling Allowance Rules click here to read more on 6th pay updates on allownaces

6th pay commission IPS(Pay) Amendment Rules, 2008 New

6th pay commission IFS(Pay) second Amendment Rules, 2008 New

Decision of the Government on Sixth Central Pay Commission Recommendations:

The pay scales for the government employees of autonomous bodies ahve been revised for a detailed news on this article click here

University teachers and other staff were disappointed when the Chadhacommittee did not submit its report last month prompting teachers union toorganize large scale protests against the delay of sixth pay commission forprofessors, lecturers and other university and college employees.

UGC constituted pay panel headed by Professor Chaddha to look into the grievances of teachers serving in universities and colleges in the India and suggest new pay package since 6 pay commission has already submitted its report to Govt. of India and the report has already been accepted and implemented by the Govt.

click here to know how to file income tax returns online

You can now pay your income tax online. Here are few steps to follow for making online tax payments.

Q. What is the procedure for paying taxes online?
A. Follow these steps to pay tax online:-

Step 1
a) Click here to open online tax payment page of NSDL
b) Click on Please Click Here link located towards bottom of the page (you need to have an account with any of the listed Banks on this page, to avail online tax payment facility)
c) Select the required challan (For payment of income tax, select challan no. ITNS 280)

Step 2
After selecting the required challan, you will be directed to the screen for entering the following data:-
a)Select box "0021 Income-tax" if you are an individual or box "0020 Corporation-tax" if you are paying taxes for a company
b) PAN of the taxpayer
c) Name and address of the taxpayer
d) Assessment Year
e) Type of payment (e.g. "100 for advance tax payments" , "300 for self assessment tax payments")
f) Select the bank name from the drop down provided

Please ensure that you enter PAN correctly, as this is extremely important for further processing. The system will check the validity of PAN. In case PAN is not available in the database of the Income Tax Department then you cannot proceed with the payment of tax.

Step 3
After entering all the above detail, click on PROCEED button. The system will display the contents you have entered along with the “Name” appearing in the Income Tax Department database with respect to the PAN entered by you.

Step 4
You can now verify the details entered by you. In case you wish to modify any details, click on EDIT. To move further, click on SUBMIT button. You will be directed to the net-banking site provided by your bank.

Q. What is the procedure after being directed to the net banking site of the bank?
A. You will have to log on to the net banking site of your bank using your login ID and password/PIN provided by the bank. The details entered by you while filling up the challan will be displayed again.

You will now be required to enter the amount of tax you intend to pay and also select your bank account number from where you intend to pay the tax. After verifying the correctness, you can proceed with confirming the payment.

Q. What will happen after I confirm the payment of tax at my bank’s site?
A.Your bank will process the transaction online by debiting the bank account indicated by you and generate a printable acknowledgment indicating the Challan Identification Number (CIN). You can verify the status of the challan in the Challan Status Inquiry using CIN after a week of making payment.

Q. What is Challan Identification Number (CIN) and what is its relevance?
A. Challan Identification Number (CIN) has three parts
a) Seven digit BSR code of the bank branch where tax is deposited
b) Date of Deposit (DD/MM/YY) of tax
c) Serial Number of Challan

CIN is used to uniquely identify the tax payment. CIN has to be quoted in the return of income as a proof of payment. CIN is also to be quoted in any further enquiry.

PAY YOUR INCOME TAX ONLINE NOW

You can now apply for a PAN (Permanent Account Number) card online in India. We have tried to answer few queries about the PAN card here:

Q. What is a PAN?
A. PAN (Permanent Account Number) is a ten digit alphanumeric number issued by Income Tax Department. This is issued in form of a laminated card (called PAN card).

Q. Who must have a PAN?
A. All tax payers who are required to furnish Income Tax Return should have a PAN.
All persons intending to enter into financial transactions, where quoting of PAN is mandatory must also obtain PAN.

Q. Can I have more than 1 PAN?
A. No. Having multiple PAN for same person or company is against the law

Q. How do I apply for PAN?
A. You need to fill up Form 49A and apply for PAN. You can apply for PAN online or offline. Click here to apply for PAN online. Alternatively, you can submit the completed Form 49A at IT PAN Service Centre or TIN Facilitation Centre.

Q. What documents are required with PAN application?
A. 1. For Individual applicants need to affix one recent, coloured photograph (Stamp Size: 3.5 cms x 2.5 cms) on Form 49A
2. Proof of Identity: Copy of school leaving certificate or matriculation certificate or degree of a recognized educational institution or depository account or credit card or bank account or water bill or ration card or property tax assessment order or passport or voter identity card or driving license or certificate of identity signed by a MP or an MLA or a Municipal Councilor or a Gazetted Officer
3. Proof of Address: Copy of electricity bill or telephone bill or depository account or credit card or bank account or ration card or employer certificate or passport or voter identity card or property tax assessment order or driving license or rent receipt or certificate of address signed by a MP/ MLA/Municipal Councilor / a Gazetted Officer

To know more about PAN, please click here.

APPLY FOR YOUR PAN CARD NOW

National Savings Certificates (NSC)

National Saving Schemes (NSC) is one of the popular Income Tax Saving schemes which is available throughout the year. It can be operated singly, jointly, or by a minor with his/her parent or guardian. There is a return on this scheme at interest rate of 8%. The minimum investment limitation of the scheme is Rs.100/- and with no upper limit. Other investments can be done in multiple of Rs. 100/-. This scheme has a maturity period of 6 years. It is transferable and also there is a provision of loan on the basis of this scheme. Under section 88 of the Income Tax Act, 1961 any person can take benefit in income tax on amount invested in this scheme and under section 80L of Income Tax Act, 1961 there is a provision of benefit on interests coming from scheme.

Public Provident Fund (PPF)

Under this scheme, there is a return at the interest rate of 8% p.a. The minimum investment limit is Rs. 500/- and maximum limitation is Rs. 70,000/-. It can be opened any time throughout the year. It can be operated either singly or jointly. In case of minor, with parent/guardian. There is also a facility of nomination in this scheme. This scheme has a maturity period of 15 years. The first loan can be taken in the third financial year from the date of opening of the account, or upto 25% of the amount at credit at the end of the first financial year. Loan amount can be returned in maximum of 36 installments. A person can withdraw an amount (not more than 50% of the balance) every year. Under Section 88 of Income Tax Act, 1961 there is a provision of tax benefit by investing in this scheme. Interest on this scheme is tax free.

Kisan Vikas Patra (KVP)

Money invested in this scheme doubles in 8 years. There is a minimum investment limitation of Rs.100/- with no upper limit. This scheme is available throughout the year. It can be operated either singly or jointly. In case of minor, with parent/ guardian. Facility for nomination is also available under this scheme. Currently there is no tax benefit on investment under this scheme.

Post Office Scheme (POS)

It is one of the best Income Tax Saving Scheme. It can be operated by either singly or jointly. In case of minor, with parent/ guardian. It is available throughout the year. There are several types of post office schemes depending upon the type of investment and maturity period. Post office schemes can be divided into following catagories:

• Monthly Deposit
• Saving Deposit
• Time Deposit
• Recurring Deposit

Special Schemes For Retiring Person

Government Employees : There is a return at the rate of 8% per annum. The minimum investment is Rs.1000/- and maximum amount equal to the total retirement benefit. Maturity period of this scheme is 3 years. According to Income Tax Act, 1961 interest on this scheme is tax free.

Public Sector Employees: Under this scheme there is a return of 9.5% payable half-yearly on 30th June and 31st December respectively. There is a minimum investment limitation of Rs.1000/- and the maximum limitation is the amount equal to total retirement benefit. It can be operated by retired PSU employees in his/her own name or with the spouse, jointly. In this scheme, there is a facility of premature encashment. Entire balance or part thereof can be withdrawn after the expiry of three years from the date of deposit. Maturity period of this scheme is 3 years. According to Income Tax Act, 1961 interest on this scheme is tax free.

Postal Life Insurance For

This scheme is in operation for the last 117 years. This scheme started in 1884 as a welfare measure for the employees of Postoffices & Telegraphs Department under Government of India to the Secretary of State (having dispatch No. 299 dated 18-10-1882). But after few years, various departments of Central and State Governments were extended its benefits. Now it is open for employees of all departments of Central as well as State Government, Nationalized Banks, Public Sector Undertakings, Financial Institutions, Local Bodies like Municipalities and Zila Parisads, Educational Institutions aided by the Government. According to Income Tax Act there is also a provision of special relaxation in income tax on the basis of investment done in urban or rural areas.

Dividend

According to Income Tax Act,1961 there is a provision benefit in Income Tax if assessee has an income as a dividend on investment in any of the following:

• Shares
• Mutual Funds
• Unit of UTI

This dividend can be given by any company or coperative society.