Signing and Ratification of agreement on exchange of Tax information - Vidya Lakshmi Educational Loans and APY

Signing and Ratification of agreement between India and Seychelles for the exchange of information with respect to taxes 


The Union Cabinet, chaired by the Prime Minister Shri Narendra Modi, has approved the signing and ratification of the agreement between India and Seychelles for exchange of information with respect to taxes. 

The Agreement will stimulate the flow of exchange of information between India and Seychelles for tax purposes, which will help curb tax evasion and tax avoidance. 

The salient features of the agreement are as follows: 

i. It will enable the Competent Authorities of India and Seychelles to provide assistance through exchange of information that is foreseeably relevant to the administration and enforcement of the domestic laws of two countries concerning taxes covered by this agreement. 

ii. Information received under the agreement shall be treated as confidential and may be disclosed only to persons or authorities (including courts or administrative bodies) concerned with assessment, collection, enforcement, prosecution or determination of appeals, in relation to taxes covered under the agreement. Information may be disclosed to any other person or entity or authority or jurisdiction with the prior written consent of the country sending the information. 

iii. The agreement also provides for a Mutual Agreement Procedure for resolving any difference or for agreeing on procedures under the agreement. 

iv. The agreement will enter into force on the date of notification of completion of procedures required by the respective laws of the two countries, for entry into force of the agreement. 

As such, the agreement does not have any financial implications. Only in the event of extraordinary costs exceeding US Dollar 500, the Government of India will bear the same, as per Article 9 of the agreement. India has similar provisions in other such tax information exchange agreements. 

Background: 

The Central Government is authorized under section 90 of the Income Tax Act, 1961 to enter into an agreement with a foreign country or specified territory for exchange of information for the prevention of evasion or avoidance of income-tax chargeable under the Income-tax Act, 1961. Negotiations for entering into an agreement for the exchange of information with respect to taxes were conducted at Seychelles from 8th to 9th June, 2015. Pursuant to this, India Seychelles have agreed on the text of the agreement. 

India has signed similar bilateral agreements for Exchange of Tax Information with Argentina, Bahamas, Bahrain, Belize, Bermuda, British Virgin Islands, Cayman Islands, Gibraltar, Guernsey, Isle of Man, Jersey, Liberia, Liechtenstein, Macao, Monaco and San Marino. 

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A Web-Based Portal VIZ. Vidya Lakshmi (www.vidyalakshmi.co.in) Launched for Students Seeking Educational Loans; First Portal of Its Kind Providing Single Window for Students to Access Information and Make Application for Educational Loans Provided by Banks as well as for Government Scholarships 


A web-based portal viz. Vidya Lakshmi (www.vidyalakshmi.co.in) was  launched on the occasion of Independence Day i.e. 15th August, 2015 for the benefit of  students seeking Educational Loans. The Portal has been developed and maintained by NSDL e-Governance Infrastructure Limited (NSDL e-Gov) under the guidance of Department of Financial Services, Ministry of Finance, Department of Higher Education, Ministry of Human Resource Development and Indian Banks’ Association (IBA).

Earlier the Union Finance Minister Shri Arun Jaitley in the Union Budget for 2015-16 inter-alia had proposed to set-up a fully IT based Student Financial Aid Authority to administer and monitor Scholarship as well as Educational Loan Schemes, through the Pradhan Mantri Vidya Lakshmi Karyakram (PMVLK) to ensure that no student misses out on higher education for lack of funds. The launch of the aforesaid Portal is a first step towards achieving this objective,

Vidya Lakshmi Portal is a first of its kind portal providing single window for Students to access information and make application for Educational Loans provided by Banks as also Government Scholarships. The Portal has the following features:

·         Information about Educational Loan Schemes of Banks;
·         Common Educational Loan Application Form for Students;
·         Facility to apply to multiple Banks for Educational Loans;
·         Facility for Banks to download Students’ Loan Applications;
·         Facility for Banks to upload loan processing status;
·         Facility for Students to email grievances/queries relating to Educational  
·         Loans to Banks;
·         Dashboard facility for Students to view status of their loan application and   
·         Linkage to National Scholarship Portal for information and application for
·         Government Scholarships.

So far, 13 Banks have registered 22 Educational Loan Schemes on the Vidya Lakshmi Portal and 5 Banks viz; SBI, IDBI Bank, Bank of India, Canara Bank & Union Bank of India have integrated their system with the Portal for providing loan processing status to students. This initiative aims to bring on board all Banks providing Educational Loans. It is expected that students throughout the country will be benefited by this initiative of the Government by making available a single window for access to various Educational Loan Schemes of all Banks.

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Atal Pension Yojana (APY) Modified to Increase the Acceptability of the Scheme Amongst Informal Sector Workers and Make the Scheme More Viable; Subscribers Would Now Have an Option to Make the Contribution on a Monthly, Quarterly, Half Yearly Basis Instead of on a Monthly Basis Earlier; Discontinuation of Payment of Contribution Provision Substantially Modified in Favour of the Subscriber; Penalty on Delayed Payment has Been Simplified 


The Atal Pension Yojana (APY) was launched by the Prime Minister Shri Narendra Modi at Kolkata on 9th May, 2015.  APY provides a minimum guaranteed pension of Rs.1000 per month or Rs. 2000 per month or Rs. 3000 per month or Rs. 4000 per month or Rs. 5000 per month, at the age group of 18-40 years.

            Certain suggestions have been received, including from the State Governments, regarding providing certain relaxations for informal sector workers, having intermittent incomes, from the provision of mandatory monthly contributions under the scheme of APY and also removing the penal provisions for non-contribution under APY to make the Scheme more viable.  The matter has been examined and the necessary revisions have been made in APY to increase the acceptability of the scheme amongst informal sector workers.

            The modified provisions carried out in the scheme are as under:

·         The individual subscribers shall have an option to make the contribution on a monthly, quarterly, half yearly basis instead  of on a monthly basis earlier
·         Discontinuation of payment of contribution provision has been substantially modified in favour of the subscriber.  The account will not be deactivated and closed till the account balance with self-contributions minus the Government co-contributions becomes zero due to deduction of account maintenance charges and fees
·         Also the penalty on delayed payment has been simplified to Rs. One (1) per month for contribution of Rs. 100, or part thereof, for each delayed monthly payment instead of different slabs given earlier
·         Similarly, premature exit from the scheme before sixty years of age was not permitted earlier except in exceptional circumstances, i.e., in the event of the death of the beneficiary or terminal disease.  Now the modified provision permits the subscriber to voluntarily exit with the condition that –
·         he shall only be refunded the contributions made by him to APY, along with the net actual interest earned on his contributions (after deducting the account maintenance charges) and ;
·         the Government co-contribution, and the interest earned on the Government co-contribution, shall not be returned to such subscribers

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