Daily Current Affairs- 1st April 2025

Daily Current Affairs 1st April 2025

Waqf Bill Set to Be Tabled: Concerns Over Retrospective Implementation

In the News: The Indian government is set to introduce the Waqf (Amendment) Bill, 2024, in the Lok Sabha on April 2, 2025. This bill proposes significant changes to the management and governance of Waqf properties. However, certain provisions, especially those concerning retrospective implementation, have raised concerns among political parties and community organizations.

Factual Details on the Issue

• Removal of 'Waqf by User' Concept: The bill seeks to eliminate the "Waqf by user" provision, which traditionally recognized properties as Waqf based on long-term religious or charitable use, even without formal documentation. Critics fear this could lead to disputes over longstanding Waqf properties lacking formal deeds.
• Ambiguity in Implementation: There is uncertainty about whether the bill's provisions will apply retrospectively or prospectively. Retrospective application could alter the status of existing Waqf properties recognized through customary use, potentially leading to legal disputes and reclassification.
• Political Party Positions:
  • Janata Dal (United) [JD(U)]: While supporting the bill's objectives, JD(U) has expressed concerns about its retrospective application. MP Sanjay Jha emphasized that the bill should not affect the current status of properties and should be applied prospectively.
  • Telugu Desam Party (TDP): TDP supports the bill, highlighting its potential to enhance transparency and efficiency in Waqf property management. TDP spokesperson Prem Kumar Jain stated that the party believes the bill will benefit the Muslim community by addressing longstanding issues in Waqf administration.
• Opposition and Community Concerns: Opposition parties and various Muslim organizations have raised alarms about the bill's provisions. They argue that removing "Waqf by user" and potential retrospective application could lead to disputes over properties historically used for religious purposes but lacking formal documentation. Concerns also extend to other proposed changes, such as including non-Muslim members in Waqf Boards and altering the dispute resolution process, which some view as undermining the autonomy of Waqf institutions. 

Centre to Own Nearly 49% of Vodafone Idea: Will It Help the Beleaguered Telco?

In the News: The Indian government is set to increase its stake in Vodafone Idea Limited (Vi) to approximately 48.99% by converting Rs.36,950 crore of the telecom company's outstanding spectrum auction dues into equity. This move aims to alleviate Vi's substantial debt burden and provide the necessary financial support for its operations.

Factual Details on the Issue

• Government's Equity Conversion: The Ministry of Communications has directed Vi to issue 3,695 crore equity shares at a face value of ₹10 each, leading to the government's stake increasing from 22.6% to 48.99%.
• Financial Implications for Vi: This equity conversion reduces Vi's net debt by approximately 18%, offering significant cash flow relief over the next three years. Despite this, the company continues to face substantial financial obligations, including annual Adjusted Gross Revenue (AGR) dues of ₹16,500 crore.
• Operational Control: Despite the government's increased stake, Vi's private promoters—Vodafone Group and Aditya Birla Group—will retain operational control of the company. Post-conversion, Vodafone Group's stake will decrease to around 16.1%, and Aditya Birla Group's holding will reduce to approximately 9.4%.
• Market Response: Following the announcement, Vi's share price surged by 10%, indicating positive investor sentiment towards the government's intervention.
• Brokerage Perspectives:
  • Citi Research: Maintains a 'Buy' rating with a target price of ₹12, citing the equity conversion as a positive step that eases Vi's cash flow pressures and enhances its ability to secure additional funding.
  • Macquarie: Holds a 'Neutral' stance with a target price of ₹7, expressing concerns about long-term structural challenges and potential equity dilution risks for minority shareholders. 

Ratan Tata's Will Includes No-Contest Clause; Beneficiary Seeks Clarification

In the News: The late industrialist Ratan Tata's will, dated February 23, 2022, has come under scrutiny due to its inclusion of a no-contest clause. This clause stipulates that any beneficiary who contests or challenges the will shall forfeit all rights and benefits bequeathed to them. Recently, Mohini Mohan Dutta, a longtime associate of Tata and one of the beneficiaries, has sought clarification regarding his share of the inheritance.

Key Details of Ratan Tata's Will

• No-Contest Clause: The will explicitly states that any beneficiary who contests or challenges its provisions will lose all entitlements. This measure aims to prevent litigation among beneficiaries and ensure a peaceful settlement.
• Estate Valuation and Distribution:
  • Total Estate: Estimated at approximately ₹3,900 crore.
  • Tata Sons Shares: Includes 3,368 shares valued at ₹1,684 crore, allocated to the Ratan Tata Endowment Foundation (70%) and the Ratan Tata Endowment Trust (30%). These shares cannot be sold or transferred except to existing Tata Sons shareholders.
  • Other Assets: Comprise investments in various companies, properties, luxury items, and bank deposits.
• Beneficiaries:
  • Mohini Mohan Dutta: Bequeathed one-third of the residual estate, excluding specific assets like company shares and properties. Dutta has sought clarification on the valuation of his share but has not contested the will's validity.
  • Shireen Jejeebhoy and Deanna Jejeebhoy: Tata's half-sisters, each receiving one-third of the residual estate.
  • Jimmy Naval Tata: Ratan Tata's brother, inheriting a share of the family property in Juhu, Mumbai, along with jewellery.
  • Mehli Mistry: A close friend, granted Tata's Alibaug property and three guns.
• Legal Proceedings: The executors of the will have filed a petition with the Bombay High Court for probate, a process to validate the will. Former Chief Justice of India, S.A. Bobde, has been appointed to arbitrate among the beneficiaries. 

Recap of New Income Tax Rules Effective April 1, 2025

In the News: As of April 1, 2025, India has implemented significant changes to its income tax structure, introducing new tax slabs, increased exemptions, and revised regulations aimed at simplifying the tax system and providing relief to taxpayers.

Key Changes in Income Tax Laws

1. Revised Income Tax Slabs Under the New Tax Regime:
   • Income up to ₹4,00,000: No tax (0%)
   • ₹4,00,001 to ₹8,00,000: 5%
   • ₹8,00,001 to ₹12,00,000: 10%
   • ₹12,00,001 to ₹16,00,000: 15%
   • ₹16,00,001 to ₹20,00,000: 20%
   • ₹20,00,001 to ₹24,00,000: 25%
   • Above ₹24,00,000: 30%

These revised slabs aim to reduce the tax burden on individuals across various income brackets.

2. Zero Tax Liability on Income up to ₹12 Lakh:
   • Individuals opting for the new tax regime with taxable income up to ₹12 lakh will have zero tax liability, thanks to a tax rebate under Section 87A of the Income Tax Act.
   • Salaried individuals benefit from a standard deduction of ₹75,000, effectively making income up to ₹12.75 lakh tax-free.
3. Increased TDS Exemption Limits:
   • Senior Citizens: The TDS exemption limit on interest income for senior citizens has been raised from ₹50,000 to ₹1 lakh, providing relief to retirees relying on interest earnings.
   • Rental Income: The annual threshold for TDS on rental income has been increased from ₹2.40 lakh to ₹6 lakh, benefiting landlords with moderate rental earnings.
4. Removal of Equalisation Levy: The equalisation levy, previously imposed on certain digital transactions, has been abolished to encourage digital business operations and reduce compliance burdens.
5. Extended Deadline for Filing Updated Income Tax Returns: Taxpayers now have up to four years to file updated income tax returns, an extension from the previous two-year limit, allowing more time to rectify omissions or errors.
6. Introduction of a New Income Tax Bill: The government plans to introduce a new Income Tax Bill aimed at simplifying the tax regime and reducing compliance burdens, expected to be presented shortly after the 2025 Budget.

USTR Report Highlights Trade Concerns Over India Ahead of Reciprocal Tariffs

In the News: The United States Trade Representative (USTR) has released its 2025 National Trade Estimate (NTE) Report, detailing various trade barriers posed by India's policies and practices. This report comes just before the U.S. plans to implement reciprocal tariffs on April 2, 2025.

Key Concerns Raised in the USTR Report

• High Import Duties: India imposes substantial tariffs on a range of American products, including:
  • Vegetable oils: up to 45%
  • Apples, corn, and motorcycles: 50%
  • Automobiles and flowers: 60%
  • Natural rubber: 70%
  • Coffee, raisins, and walnuts: 100%
  • Alcoholic beverages: 150%
• Non-Tariff Barriers:
  • Dairy Import Restrictions: India mandates that dairy products must originate from animals not fed with feed containing blood meal, a requirement viewed as overly stringent by U.S. exporters.
  • Import Licensing: Strict licensing procedures for remanufactured goods hinder the entry of U.S. products into the Indian market.
• Regulatory Challenges:
  • Internet Shutdowns: Frequent localized internet shutdowns in India disrupt commercial operations, affecting digital trade and communication.
  • Data Privacy Regulations: India's draft Digital Personal Data Protection Act includes provisions that may compel the disclosure of personal data to the government, restrict cross-border data transfers, and potentially enforce data localization, raising concerns among U.S. businesses.
• Intellectual Property Rights (IPR): The USTR has placed India on its 'Priority Watch List' due to inconsistent progress on IPR protection and enforcement, indicating significant concerns over India's patent regime and protection of trade secrets.