Regarding Detailed head for consolidated pay or remuneration paid to a contracted person.

Government of West Bengal
Finance Department
Budget Branch

No. 1 – F.B.


The 3rd January, 2011


Sub:- Regarding Detailed head for consolidated pay or remuneration paid to a contracted person.

   It is observed that for making payment of consolidated pay or remuneration to the contracted persons, some departments are treating such payment differently. In some cases it is incurred under detailed / sub-detailed heads “01-01” whereas in some cases it is incurred under detailed head ‘02’ and in the rest cases it is incurred under detailed / sub-detailed head ’31-01’. Such bookings may lead to improper accounting as well as confusion.

   In view of the above circumstances, the undersigned is directed by order of the Governor to say that for general contractual payment, the charge will be debitable to the detailed head “02-Wages”, whereas for payment towards professional and Special Services, the charge will be debitable under '28-Payment of Professional and Special Services-02-Other Charges’ subordinate to concerned major / sub-major / minor / sub-head to avoid further irregularities, with immediate effect.

A. Ahmed
Deputy Secretary.


ECHS Facilities to Ex-Servicemen.

   The Government has sanctioned 426 Polyclinics for Ex- Servicemen Contributory Health Scheme (ECHS). 227 Polyclinics were sanctioned in the year 2002, all of which are functional. Due to increasing ESM population an additional 199 Polyclinics including 17 Mobile Clinics were sanctioned in October 2010, out of which 43 Polyclinics are operational, thus at present 270 Polyclinics are functioning. In addition the Government has sanctioned 15 new Regional Centers to strengthen the ECHS Services, out of which 6 Regional Centers are already functional. As on 1st March, 2012, there are 39,46,898 beneficiaries which include 12,34,069 ex-servicemen and 27,12,829 dependents.

   The ECHS beneficiaries can avail treatment at state Government hospitals/Clinics. The cost of treatment at Government hospitals is reimbursed at the approved rates and 80% advance of the estimated cost of the treatment at Government hospitals/Clinics is admissible to the ECHS beneficiaries.

   At present 1383 Private hospitals/Dental Clinics/Diagnostics Centers and Eye clinics throughout the country are empanelled with ECHS, where the ECHS beneficiaries can avail cashless treatment. In emergency cases, reimbursement is made at approved rates, even for treatment in non-empanelled hospitals.

   This information was given by Minister of State for Defence Dr MM Pallam Raju in written reply to Shri Virender Kashyap and Shri Kuldeep Bishnoi in Lok Sabha today.


Revision of Interest rates for small savings schemes.

No. 6-1/2011-NS.II (Pt.)
Ministry of Finance
Department of Economic Affairs
(Budget Division)

New Delhi, the 26th March, 2012.


Sub:- Revision of Interest rates for small savings schemes.

   The undersigned is directed to refer to Ministry of Finance’s O.M. of even number  dated 11th  November, 2011, vide which the various decisions taken by the Government on the recommendations of the Shyamala Gopinath Committee for Comprehensive Review of National Small Savings Fund (NSSF), were communicated to all concerned.

   2. One of the decisions of the Government based on the recommendations of the Committee relates to revision of interest rates every financial year, to be notified before 1st  April of that year. Accordingly, the rates of interest on various small savings schemes for the financial year 2012-13 effective from 1.4.2012, on the basis of the interest compounding/payment built-in in the schemes, shall be as under:


Rate of interest w.e.f.1.12.2011

Rate of interest w.e.f.1.4.2012

Saving deposit



1 year time deposit



2 year time deposit



3 year time deposit



5 year time deposit



5year recurring deposit



5year SCSS



5year MIS



5year NSC



10 year NSC






3. Necessary notifications, including those requiring amendments to rules of small savings schemes will be notified separately.

4. This has the approval of Finance Minister.

(Shaktikanta Das)
Addi. Secretary to the Govt. of India


Railway Service (Revised Pay) Rules, 2008 – Date of next Increment in the revised pay structure under Rule 10 of the RS(RP) Rules, 2008.


S.No. PC-VI/2801

RBF No.40/2012
New Delhi, dated 23.03.2012

The GMs/CAOs(R),
All Indian Railway & Production Units
(As per mailing list)

Sub:- Railway Service (Revised Pay) Rules, 2008 – Date of next Increment in the revised pay structure under Rule 10 of the RS(RP) Rules, 2008.

   In accordance with the provisions contained in Rule 10 of the RS(RP) Rules, 2008, there will be a uniform date of annual increment, viz, 1st July of every year. Employees completing 6 months and above in the revised pay structure as on 1st of July will be eligible to be granted the increment. The first increment after fixation of pay on 1.1.2006 in the revised pay structure will be granted on 1.7.2006 for those employees for whom the date of next increment was between 1st July, 2006 to 1st January, 2007.

   2. The Staff Side has represented on this issue and has requested that those employees who were due to get their annual increment between February to June during 2006 may be granted one increment on 01.01.2006 in the pre-revised scale.

   3. On further consideration and in exercise of the powers available under RS(RP) Rules, 2008, the President is pleased to decide that in relaxation of stipulation under Rule 10 of these Rules, those Railway employees who were due to get their annual increment between February to June during 2006 may be granted one increment on 1.1.2006 in the pre-revised pay structure on 1.7.2006 as per Rule 10 of RS(RP) Rules, 2008. The pay of the eligible employees may be re-fixed accordingly.

   4. This issues with the concurrence of Finance Directorate of the Ministry of Railways.

   5. Hindi version will follow.

(Hari Kishan)
Director Pay Commission-II
Railway Board

All you wanted to know about Mutual fund ELSS

   There are so many tax saving investment options; how Mutual fund ELSS Schemes stand out from all other options?

   A Mutual Fund ELSS is similar to diversified equity funds. That means the fund manager can invest in shares of various companies across various industries. The difference is ELSS has got the added tax benefit, something a diversified equity fund does not offer.

   ELSS is part of the Section 80C instruments which are cumulatively eligible for a deduction from income up to Rs.1 Lakh. This gives the tax payers benefits from 10 per cent to 30 per cent (excluding the educational cess) based on their current tax slab.

   The other tax saving investments like NSC, PPF will give only 8% return p.a whereas the Mutual Fund ELSS has got the potential to deliver more than 12% return p.a. Also the lock-in period in Mutual Fund ELSS is 3 years and with NSC it is 6 yrs lock-in and with PPF it is 15 years. Among the various tax saving investment option, Mutual fund ELSS has got the least lock-in period.

   Ulips are also one of the tax saving investment options. But now everyone has realized that Ulips has got heavy front loaded charges. Moreover smart investors want to separate their insurance from their investments. They no longer see insurance as an investment; they see insurance as a protection plan. So the smart investors go only for pure term insurance and reject ulips.

This is how Mutual Fund ELSS stands out of the crowd.

   Before deciding to go for Mutual fund ELSS, here are some points to ponder over. First check your overall portfolio. Does it need more equity exposure? If yes then you can go for ELSS; if no then you can go for PPF or NSC.

   Second thing is to keep in mind, the equity investments are for long term, say 5 years or more. Though the lock-in period in ELSS is 3 years it is better to invest with a time horizon of 5 yrs or more.

   Also investors need to keep in mind, SIP is the best form of investing in mutual funds and ELSS is not an exception. So doing an SIP in ELSS is a good strategy to be followed.

   The poor performing ELSS has given around 10% annualized return in the last 5 years whereas the best performing ELSS has delivered around 25% annualized return in the last 5 years. So investors need to be careful in choosing the right ELSS scheme. Past performance, risk adjusted return, consistency are a few parameters to be evaluated in selecting a best performing ELSS scheme. Investors also can approach financial advisors for selecting the right scheme.

   There are two groups of ELSS investors. Majority of investors belong to the first group. They will wake up late to these tax saving investments. For salaried individuals, it is typical that they will be informed by their accounts department somewhere around end of January to provide proof of tax saving investment immediately or else extra tax will be deducted from their February salary. At the neck of the moment, the choice ends up being guided by convenience alone. They tend to think about tax first and investments later. As long as something saves tax, its real benefits and features as an investment are paid less attention to. That means the investments will be chosen more for convenience than for suitability.

   There is another group of investors. Though this group is a very small group, it is a very smart group. They will not rush for tax saving scheme at the last minute. They will plan in advance. That means they will have more time to choose the right product. They will save tax as well as choose a good investment option. They will also check whether this particular tax saving scheme will suit their overall portfolio or not; will this tax saving investment is going to fit into their comprehensive financial plan. That means they will consciously choose an investment which saves tax as well as helps them in achieving their financial goals like children’s higher education, buying a house, retirement plans.

   So…now just check up which group you are in.

The author is Ramalingam K, an MBA (Finance) and Certified Financial Planner. He is the Founder and Director of Holistic Investment Planners ( a firm that offers Financial Planning and Wealth Management. He can be reached at

A step by step guide to first financial plan.

   Prabu was a college student till yesterday. Today he has got a job. He has changed his costume from T-shirt and jeans to a formal wear with a tie. When he got his first pay cheque, his father advised him to save, his girl friend asked him to take her out on a date, and his friends wanted a party. Prabu was totally confused what to do with his first salary. What are all his actual priorities? Let us help him by laying out a step by step initial financial plan for him.

Get a PAN Card:

   PAN Card is an ID card issued by income tax department. This card is useful in filing your Income Tax returns. Apart from this, the PAN card is very much useful in opening a bank a\c, demat a\c, investing in mutual funds and the like. The required documents for getting a PAN card is a passport size photo, address proof and an identification proof. You need to apply with either UTI or NSDL. They are the two approved agencies by income tax department for issuing PAN card.

Personal Accident and Disability Insurance:

   Almost every day you can find a news column about road accident. It may be your colleague, your distant relative, your neighbor, your friend, your classmate. The stories of such incidents give us a reminder that the accidents can happen to anyone. The impact of these accidents on ones working life could be huge. Some accidents could reduce our employability temporarily or permanently. Personal accident and disability insurance policies will cover the financial losses arising out of accident and disability.

   You need to decide the coverage amount of this policy based on the estimated loss you may suffer because of accident. That is how much loss you may incur from employment temporarily or permanently because of the accident. This will cost you approximately Rs.1500 p.a for a coverage of Rs.10 lakhs.

Health Insurance:

   Most people don’t think about health insurance very often. But it comes to mind first when a loved one is sick. Under health insurance, the insurance company pays the medical bills if the insured person becomes sick and hospitalized. Health insurance can protect a family from financial damage in case of severe and serious illness.

   If you have a health insurance from your employer, that may not be sufficient. Employer may cover the employee and not his family members. And moreover these policies are not portable and cannot be individualized if you leave the job. Employer provided policies cannot be transferred to another employer in case you switch your job. Also employer provided policies will give you coverage as long as you are employed. Once you retire you may not be having coverage. It is really unfortunate that only after your retirement you need health insurance at the most. If you plan to take a fresh policy after retirement, insurance company will not cover the pre-existing diseases at that point in time. Though your employer provides a health insurance policy it is better for you to take a separate health insurance policy at least with a small amount of coverage.

   The coverage amount of the health insurance policy need to be decided based on your health consciousness, your family health history, and the class of hospital you choose for treatments.

Term Insurance:

   Generally as a beginner, there will not be any requirement for any life insurance. But if your parents are financially depending on you, then you need to cover yourself with life insurance. As a breadwinner, today you are there for your family to provide a lifestyle. In case of any mishappening to you, your family members should not compromise on their lifestyle. That is why it is advisable to cover yourself with life insurance if you have dependents.

   But don’t fall prey for ulips. Go for a pure term insurance policy. These policies give you a high coverage with low premium. The premium for a sum assured of Rs.10 lakhs will cost a 25 year old only Rs.2500 p.a. approximately.

Emergency Reserve:

   Once you have completed the above obligations, you need to build an emergency reserve or contingency fund. One aspect of financial planning involves planning for situations where there could be a temporary break in one’s professional income. This could happen, amongst other reasons, due to ill health or could even be self opted. Such planning requires creation of contingency fund. The size of a contingency fund is linked to one’s estimate of what could be the maximum duration of such a break. For instance some people plan for the possibility of a 3 months break, others for 6 months.

   This emergency fund gives a psychological security to you. In case you need to quit you r present job and need to search a new one, you can do that comfortably and confidently as you have an emergency fund for the intermediate period. You need not panic. If you have created a contingency fund, in the event of any emergency you need not pre-close your other investments and hence you avoid paying penalty or booking losses.

Tax Planning:

   You can save under section 80 C up to Rs.120000. Out of this Rs.20000 need to be invested in the infrastructure bonds and the balance Rs.100000 can be invested in NSC, PPF, insurance premium, and ELSS mutual funds., You can give maximum allocation to ELSS mutual funds, as you are so young and in the beginning of your career.

Other goals:

   You may have other goals like buying a laptop, higher studies, and vacation. You need to plan for all these goals. You need to keep in mind two things before deciding an investment. They are your risk tolerance and time horizon. How much risk you are afford to take and psychologically comfortable in taking? When do you need this money back? Based on the answers to these questions you need to choose the right kind of investment plan.

   Plan out your work and work out your plan. Normally we don’t plan to fail, but we fail to plan.If you work on your financial plan, when your friends are partying and taking their girlfriends out, you will be definitely going to be retired richer than your friends.

The author is Ramalingam K, an MBA (Finance)and Certified Financial Planner. He is the Founder Director of Holistic Investment Planners ( ) a firm that offers Financial Planning and Wealth Management. He can be reached at