On behalf of Urban Cooperative Banks and Credit Societies- Nafcub President Jyotindra Mehta has written a letter to Union Finance Minister Nirmala Sitharaman apprising her of the expectations of the co-op sector from the budget.
In his letter, Mehta has touched on almost all the issues plaguing different sectors including UCBs, Credit Co-op, Income Tax and many others. The Nafcub President demanded an exclusive section for UCBs in the Ministry of Finance.
He has raised many issues including Restoration of Deduction u/s 80P(2) to UCBs that was withdrawn in 2006-07 by introduction of Sec80(P)(4) and Sec.80(c)(xxi) of the Income Tax Act 1961 – Inclusion of deposits with non- scheduled cooperative banks for eligibility.
In the interest of cooperative credit societies, Mehta Demanded applicability of Section 269SS & Section 269T to Cooperative Credit Societies, He has also sought applicability of Section 269ST to Cooperative Credit Societies and applicability of provisions of GST Act to Co-op. Credit Societies.
The issues related to Urban Cooperative Banking include “Creation of a post of Deputy Governor in RBI for Co-operative Banking Sector, amendment to DICGC Act to help revive/ rehabilitation/ merger of stressed UCBs that will mitigate sufferings of non–insured deposit account holders’ ‘, he informed.
“Inclusion of UCBs in Pradhan Mantri Awas Yojana and in Pradhan Mantri MUDRA Yojana (PMMY). Constitution of Appellate Authority by RBI for hearing cases of imposition of penalties. Introduction of differential regulations for UCBs of different sizes by RBI”, his letter has suggested.
The Nafcub President has asked for the review of the restrictive policy of issuance of licenses to UCBs for opening branches, and aligning with the policy for commercial banks by the RBI. UCBs are permitted to finance primary cooperatives engaged in different sectors of economy, he added.
He has demanded that UCBs also be permitted to sell their stressed assets to ARCs. UCBs should also be permitted to classify wilful defaulters as per the RBI definition.
Besides, he has also touched on provisions of the Amendment in Banking Regulation Act 1949 which include, Directions of RBI on appointment of Managing Director (MD)/ Whole Time Director (WTD) in Primary Urban Cooperative Banks. Terms of Directors of Primary Urban Co-operative Banks.