Ease of Doing Business in the world is one of the most important report viewed by investors and corporations before deciding to open a venture in a new country. The report ranks companies and considers various parameters like starting a business, dealing with construction permits, registering a property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts, labor market regulations and last but not the least is resolving insolvency.

What do we mean by Resolving Insolvency?

Resolving insolvency involves understanding Time, cost, outcome and recovery rate for a commercial insolvency and the strength of the legal framework for insolvency. In-order to improve India’s rank in the Ease of Doing business in the world and move closer to be in the top 50 countries in the world to do business. For the first time, India jumped a record 30 places from 132 in 2008 to 100 in the Ease of Doing Business report for 2018, which is an influential 190-country barometer of competitiveness that many businesses likely consider for investment decisions.

The Insolvency and Bankruptcy Code of India (IBC) was put into effect in May, 2016 and the authorities began to invoke the act after six months, in December that year. The IBC was introduced to aid lenders in timely and effective recovery or restructuring of the defaulted assets and to mitigate the stress on the Indian credit system. The Code is a welcome overhaul of the existing framework dealing with insolvency of corporates, individuals, partnerships and other entities. It paves the way for much needed reforms while focusing on creditor driven insolvency resolution. It provides a time-bound process for resolving insolvency in companies and among individuals. The code help India rank improve from 136 to 103 in the parameter of resolving insolvency. Strength of insolvency framework index increased from 6 to 8.5.

  What is Insolvency?

Insolvency is when an individual or organization is unable to meet its outstanding financial debt towards its lender as it become due. Insolvency is a short-term inability to meet liabilities during the normal course of business, Insolvency can be resolved by way of changing the repayment plan of the loans or writing off a part thereof. If it cannot be resolved, then a legal action may lie against the insolvent and its assets will be sold to pay off the outstanding debts. Generally, an official assignee/liquidator appointed by the Government of India, realizes the assets and allocates it among the creditors of the insolvent.

What is Bankruptcy?

Bankruptcy is a concept slightly different from insolvency, which is rather amicable. A bankruptcy is when a person voluntary declares himself as an insolvent and goes to the court. On declaring him as ‘bankrupt’, the court is responsible to liquidate the personal property of the insolvent and hand it out to its creditors. It provides a fresh lease of life to the insolvent.

The Insolvency and Bankruptcy Code (Amendment) Ordinance, 2017 was promulgated on November 23, 2017.  It amends the Insolvency and Bankruptcy Code, 2016.

The ordinance has been initiated as a response to the mounting pressure of Non Performing Assets (NPAs) that is building on the banking sector. The Reserve Bank of India has identified 12 such accounts that form 25% of the NPAs in the Banking Sector.

The ordinance suggests certain changes in the IBC primarily in relation to the eligibility of the promoters in the resolution process of the insolvent company. A promoter is disqualified from participating in the resolution process if:

i)he is an undischarged insolvent (individual unable to repay his debt),

(ii) he is a wilful defaulter identified by the Reserve Bank of India,

(iii) his account has been identified as a non-performing asset for more than a year, (iv) he has been convicted of an offence punishable with two or more years of imprisonment,

(v) he has been disqualified as a director under the Companies Act, 2013,

(vi) he has been prohibited from trading in securities,

(vii) he has indulged in undervalued or fraudulent transactions,

(viii) he has executed an enforceable guarantee in favour of a person who is a creditor to a defaulter undergoing a resolution process,

(ix) he is connected to any such person mentioned above (including promoters or people in control of the defaulting firm during the implementation of the resolution plan), or

(x) he has indulged in any of these activities outside India.

The reason for laying down specific eligibility criteria for promoters is that India doesn’t have a well-developed distress asset investment market. Because of this, the lenders are constrained to give the company back to the inefficient promoters at huge discounts, adding to the burden on the Indian credit system. At the same time, the IBC doesn’t want to discourage genuine promoters who haven’t defaulted voluntarily and thus must be given a second chance.

The Code unambiguously states that the trigger for an insolvency petition is a single default (more than INR1 lakh) which, if approved, will result in the lenders taking over the management of the defaulter through an Insolvency Professional.

The Code proposes two independent stages:

Insolvency Resolution Process, during which financial creditors assess whether the debtor’s business is viable to continue and the options for its rescue and revival; and

Liquidation, if the insolvency resolution process fails or financial creditors decide to wind down and distribute the assets of the debtor.

The code lays down detailed process for filing for insolvency & bankruptcy. The IBC has been well received by the banking sector but with a sense of caution. They are of the view that exclusion of the promoters may make the bidding process less competitive and they would have to suffer hair cuts.

As the chief of State Bank of India puts it, “We don’t mind haircut but we don’t want to be bald.” The full implications of the amended IBC would be realized once the ordinance is approved and enacted.

All you need to know about Bitcoin’s & why should you care !!!

All you need to Know about Bitcoin’s & why should you care !!!

  • Dr. Navin Punjabi, Assistant Professor & Director Placements H. R.  College  of Commerce & Economics, Mentor – Board of Industry Academia Partnerships  (BIAP). The author can be reached at
  • The author would like to thank his Research Assistant Krish Jain a student of Third Year Financial Markets at H R College of Commerce & Economics.

Bitcoin is in the news from the last four to five years & is becoming a dinner table & networking conversation for people. I realised its popularity when I was travelling to Ajmer just 2 weeks ago to attend my sister-in-law’s wedding and at the platform I met one of my ex-student Naved who was planning to visit the ‘Darga Sharif’ at Ajmer to seek the blessings of almighty. He was delighted to bump in to me at Bandra Terminus and we had conversations regarding college, careers, jobs, his batch-mates and lot of other interesting topics. Since the journey was long the topic slowly moved to stock markets and the budget and then moved to the talk of the town ‘Bitcoins’ I didn’t participate much and shared my opinion on Bitcoins not being recognized as legal tender. We continued our journey and me and my family attended the wedding, it was interesting for me to learn the extent of curiosity my relatives had regarding bitcoins my aunt from Jodhpur showed very keen interest in this topic as her son had requested her to invest 3 lakhs in Bitcoin & she wanted my opinion if she should invest in Bitcoins at $25000 dollars. She is an investor in stocks & mutual funds and understands markets. What was interesting is my aunt was trying to find a fair value of a bitcoin & how to buy one or should her son get in to mining a bitcoin.

So that’s what motivated me to write the article since investor have made bitcoin a topic of discussion at dinner table, networking meets and academic gathering & this bitcoin wave is catching attention of many with limited understanding of the underline concept of cryptocurrency and bitcoins, in my humble opinion it’s more of a herd mentality. The objective of this article is to move the conversation from fair value of bitcoins to discussions like Is Bitcoin legal or illegal? Will it be accepted universally or not? Is it a medium of exchange? Are there other cryptocurrencies? I strongly believe life is all about asking the right questions so wanted to motivate the readers to ask these questions as reflection of their thoughts on the subjects or ask these question to their peers at cocktails meets and dinner table to get a better understanding from the ones propagating buying Bitcoins.


An Introduction

A form of digital money, Bitcoins existence traces back to January 2008. Then inventor of Bitcoin is ‘Satoshi Nakamoto’, this name is used by the unknown creator of the protocol used in the bitcoin cryptocurrency. Satoshi Nakamoto is closely-associated with Bitcoin and the Bitcoin blockchain technology.

There is lot of speculations with the inventor some believe its an individual some believe it’s a group of men under the name of ‘Satashi Nakamoto’ who invented it. Satoshi Nakamoto means “Central Intelligence” in Japanese. In a web search, you’ll find out that Satoshi is usually a name given for baby boys which means “clear thinking, quick witted, wise,” while Nakamoto is a Japanese surname which means ‘central origin’ or ‘(one who lives) in the middle’ as people with this surname are found mostly in the Ryukyu islands which is strongly associated with the Ryūkyū Kingdom, a highly centralized kingdom that originated from the Okinawa Islands. So combining Nakamoto and Satoshi can be loosely interpreted as “Central Intelligence”. The principle motive of this invention was to have a medium of exchange that was beyond the reach of rules and regulations of any government or institution. A deregulated currency, bitcoins may be used for illegal transactions on the dark web as all transactions are irreversible.

Bitcoins can be stored in e-wallets that are specially designed programs. The smallest amount one can buy is a Satoshi which is 0.00000001 bitcoin or one hundred millionth of a bitcoin. Nakamoto was the first person to mine 50 bitcoins back in 2008. The first transaction involving bitcoin was reported on May 22, 2010, when Laszlo Hanyecz, a programmer paid 10,000 bitcoins for pizza.

Pricing of Bitcoins

Bitcoin’s price is determined by the market forces of demand and supply. The supply of bitcoins is limited to 21 million. At present, 16.7 million bitcoins are in use. The increasing demand, combined with the limited supply of bitcoins has forced the prices to go up. For example. A bitcoin was worth hundreds of USD in 2015, but today it is trading at $18,000 levels (as on January 2018).


Every bitcoin has a unique address. Creating a bitcoin address is nothing more than picking a random valid private key and computing the corresponding bitcoin address. One can keep a track of the bitcoin transactions as every transaction is seen by the entire network in a matter of seconds and is recorded in the worldwide ledger i.e. blockchain. A blockchain cannot be manipulated since a number of users maintain it leading to a multiple check.


How to Get Hands on A Bitcoin

There are number of ways how one can get his/her hands on a bitcoin.

One can accept bitcoins in exchange for goods and services provided.

  • Bitcoins can be bought directly from certain websites, called ‘Exchanges’ in exchange of regular currency. CoinBase (based in San Francisco) is one such website.
  • One can obtain bitcoins through the process of mining.


Bitcoin Mining

Mining is the process wherein the miners dedicate their computers to verify transactions on the peer-to-peer network. Every 10 minutes a new block of 12.5 bitcoins is added, which is then verified by these miners. In return for donating their processing power, the miners are given a proportionate number of bitcoins as a reward. In recent times, one would need a specialised hardware to maximize the efficiency of computers or a super computer.

Miners keep the block consistent and complete by verifying and collecting newly broadcasted transactions into a new group of transactions called a block. Each block is connected to the previous block through a cryptographic hashtag using the hashing algorithms, thus giving it the name of a blockchain. Every time a new block is solved, one receives the reward of 12.5 bitcoins.


Initially, a bitcoin miner was rewarded with 50 bitcoins in 2008. Every 4 years, this reward is slashed into half. The reward post 2020 will be 6.25 bitcoins.

Year 2008 – 2012 2012 – 2016 2016 – 2020
Reward 50 bitcoins 25 bitcoins 12.5 bitcoins

Should a Retail Investor Invest in Bitcoins? Read more

How to Protect Yourself from the Mis-Selling of Financial Products

  • Navin Punjabi, Assistant Professor & Director Placements H R College of Commerce & Economics, Mentor Board of Industry-Academia Partnerships
  • The author would like to thank Kanika Jain a student of Third Year Financial Markets at H R College of Commerce & Economics.


mis-selling, financial planning, agent, advisor, investor education


Unless they are a certified professional or expert, only a few understand the legalese of financial contracts or the technical details of various investment products. Most rely on the advice of a financial advisor or planner, who may ignore the needs of their clients in favour of hefty commissions paid by the companies whose products they recommend. This commission culture has made the practice of mis-selling rampant in the industry. As a consumer and investor, financial literacy and awareness is critical to protecting yourself. Here is what you should look out for –

Understand the difference between a financial advisor and an agent

An agent is an employee of the insurance agency, bank or mutual fund hired to sell their products. Since agents are paid commissions based on the number of sales they make, they may not keep their client’s interests in mind and will sell the policy which will earn them the maximum commission. A financial advisor, on the other hand, is an independent consultant who counsels clients on a range of financial products to meet investment goals in exchange for a fee. However, the lines between the two professions have blurred over time, and there are several financial advisors who receive commissions from companies to push their products in addition to the fees they charge customers. As a result, investors must safeguard their interests by taking further precautions. The regulator is taking many steps to ensure there is clear distinction between distributors and advisors. However, the investor must take care and understand what he really needs a distributor or an advisor. Many agents are also excellent advisors who many a times walk out of a deal saying it’s not in the best interest of the client even though they might receive a commission for recommending that financial product.

Check the name of the financial product you purchase

Companies often have a number of different financial products with similar names. Agents and advisors often avoid using the full name of the product and may sell you an investment plan with ‘added insurance benefits’ when what you are buying is in reality a complex unit-linked insurance plan. Similar ruses include selling a term insurance for a house or a car with ‘returns’ or a ‘short term’ life insurance plan. Remember, life insurance is meant to be a long term product that protects your family and assets from unforeseen events in the future.

 Ask for the company’s projected returns

When the agent or advisor sits down to demonstrate the returns of the financial product, make sure the calculation you are being shown is the company’s official illustration on their website or similar software, and not the agent’s handwritten calculation. In the latter case, agents often exaggerate the numbers to double digit returns in order to make a compelling case for the sale. If the agent does not have a standard illustration available, contact the company directly. However, do keep in mind that even company projections are often inflated and do not reflect hidden costs.

Read all documents and fill in the form yourself

Despite being warned by the disclaimers in advertisements, most investors do not read the accompanying documentation and leave it to their advisors to explain the scheme to them and fill the form. Reading all related documents informs investors of specifications that may have been overlooked in the sales pitch such as additional charges and lock-in periods, as well as ensures that investors understand the product they are buying. By filling in forms themselves, investors can minimise errors and see to it that agents are not bundling additional products with the scheme.

Look out for hidden costs

These include entry and exit loads for mutual funds, as well as brokerage fees, management fees, redemption fees and commission. The lack of cost transparency at most financial companies means that investors often end up paying for misallocation of funds by managers and lose a significant percentage of their hypothetical earnings, Hence, projected returns for financial products should not be taken at face value.

Remember, there is no compulsion to buy a product

Bank employees often aggressively pitch certain products alongside others, for example, insurance along with a loan or a bank locker, only if you invested in their fixed deposit. In such cases, there is a high probability that the employee is engaging in mis-selling. It is up to investors to know their financial requirements and stay informed. Certain products can be returned for instance, there is a 15 days free look period for an insurance policy for an investor if he feels the insurance policy is not what he expected. Thereafter he can return the policy within 15days from the date of issue during the free look period.

 Know your rights

As of 23rd June 2017, the RBI broadened the mandate of the Banking Ombudsman Scheme 2006 to include the resolution of grievances arising from the mis-selling of mutual funds, insurance, and other third-party investment products by banks. This makes banks liable for the mis-selling of any third party products by their employees. Additionally, the banking ombudsman can pass awards of up to Rs 20 lakh (an increase from the previous figure of Rs 10 lakh), along with granting a compensation of Rs 1 lakh for the loss suffered by the victim in terms of time and money.

According to the amendment made by the RBI, the banking ombudsman can now oversee cases related to –

  • Improper and unsuitable sale of third-party financial products
  • Not enough transparency when the product was sold
  • Nondisclosure of grievance redressal mechanism
  • Delay or refusal to facilitate after-sales service by the bank

In case of mis-selling, customers must first register a complaint with the bank and wait for a period of thirty days. If the bank does not offer a remedy, the complainant can file a charge with the banking ombudsman. It is mandatory for each bank branch to display the address of the banking ombudsman under which it falls. The customer may register a complaint via an online or offline channel. This process is free and does not require the services of an advocate. The customer may represent their case themselves or through a representative. The ombudsman can refuse a case that is time-barred or already heard in another court.

Although the new RBI regulations act as a safety net, it is imperative for investors to educate themselves about the financial products they are buying and be aware of possible ploys by banks, agents, and other financial companies. The best way is to prevent yourself being mis-sold a financial product by asking the right questions. Some of the questions you may want to ask the sales person/ agent / advisor are as follows: –

1) What are the risk factors in the financial product?

2) How much commission will you get?

3) How has the scheme performed in the past 5years/10years?

4) What is the return one can expect? Is there any minimum guarantee?

5) Can I request for the detailed break up of costs in the product?

6) Can you compare the cost with some competitors?

7) Why should your product be bought over your competitor?

8) Can you show me an illustration of the returns expected in this product?

9) Is the illustration shown as per the regulatory norms?

The whole idea of writing this article was to make investors aware of the questions one may ask to protect or prevent any mis selling of financial products to them. The next article will deal with how to make a complaint for any deficiency in service or any mis-selling, whom to approach, how to approach.

Disclaimer – The view & opinions expressed in this article are personal and do not reflect the views of the authors employer or any other institution that the author is affiliated to. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should make such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the companies referred to in this document (including the merits and risks involved), and should consult their own advisors to determine the merits and risks of such an investment.

Investing for your child v/s Investing in your child’s name

Investing for your child v/s Investing in your child’s name

  • Navin Punjabi, Assistant Professor & Director Placements H R College of Commerce & Economics, Mentor Board of Industry-Academia Partnerships

Disclaimer – The view & opinions expressed in this article are personal and do not reflect the views of the authors employer or any other institution that the author is affiliated to. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should make such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the companies referred to in this document (including the merits and risks involved), and should consult their own advisors to determine the merits and risks of such an investment. Mutual Fund investments are subject to market risk. Please read all offer related documents carefully before investing.

The earliest & fondest memory of money is when our grandparents would give us a 100 rupee note & we would put it in a piggy bank. However, when we asked for the money to be removed from our piggy bank we would be explained the concept of savings and be told that you will get the money back once the piggy bank is full. The concept of piggy bank was introduced to inculcate the habits of savings in children. However, none of us were introduced to the concept of investing at an early age.

With changing times, one needs to inculcate the concept of savings and investment at an early age and explain the difference between both, savings and investments. One could teach the concept of investment by asking the child to use 50% of the piggy bank money to buy a gift of their choice game, colors etc a fun thing of their choice and 50% of the money be invested in a financial instrument. The child can be taken as a visit to a bank and taught the principles of banking & finance like fun activity. Schools may also include this as part of their field trip at an early age so that they develop interest in finance and don’t consider it boring at a later stage in their life.

One of the biggest financial goal for any family is fulfilling aspirations of their children. Whether it is buying a new house so the child has a separate room, or  buying a car or planning the child’s education in India or abroad, when it a matter of the child’s future, parents strive for the best.

The two broad approaches for minor investments for children are:

  1. Investing for your child
  2. investing in your child’s name:

Investing for your child means the investments are made in the parent’s name in regular financial instruments namely fixed deposits, mutual funds, shares, property etc. However, the goals for which the investments are made are for the children.

Investing in child’s name is where the holdings are invested in the child’s name and the parents act as guardians. The documents needed for registering the minor, are documents such as Birth Certificate, Passport copy and other documents which help evidence a relationship between the minor and guardian. In all investments, the investments must be held solely in the name of the minor child and no joint holders are allowed. One must also note in such case nominations are not permitted as per rules. The guardian must be a parent or legally appointed guardian. However, once minor children become major, the management of the investment passes into their hands and the parents have little control on how the funds will be used.

The bank account through which the payments for the investment will be made, and the credits received, can either be in the name of the guardian or in the name of the minor under guardianship. If the payment is routed through the minor investor’s bank account under guardianship, then a declaration from the bank manager may be required to certify the details of ownership of the bank account. Irrespective of the source of payment, the ownership of the investments will lie with the minor investor.

When minor is attaining major one should keep in mind the following procedure:

  1. Minor attaining Major: Once a minor attains majority status i.e. becomes 18 years of age, the investor has to apply for a change of status in the investment. All the investment formalities such as PAN and KYC will now have to be complied with by the till-now minor investor. Her signature, attested by the bank manager, will replace that of the guardian in the investment records, and the new bank account details have to be provided for all future credits and debits related to the investment. Typically, an investment made in the name of a minor cannot be operated by the guardian once the minor becomes a major. Facilities such as standing instructions in bank accounts, systematic investment and redemption plans and others will be registered only till the date when the minor investor attains majority.
  2. Taxation: Even if the investment is held in a minor child’s name, clubbing provisions will mean that any income will be liable to payment of tax by the parent. In addition, there’s another tax advantage. If the parents invest in a taxable investment in the name of the child, they can claim an annual exemption of Rs 1,500 per child under Section 10 (32) of the Income Tax Act, 1961. Say, the interest income in a year is Rs 6,500, the parents can claim exemption up to Rs 1,500 and add the balance of Rs 5,000 to their income.
  3. Should minors invest in Mutual Funds? The minor and guardian must understand the reason for investment. Their risk appetite, desired return, and long term or short-term strategy, along with helping the money grow and become useful for the minor when he attains major status; all these factors must be taken into account. Once all these factors are weighed out, the ideal fund should be identified and then if the aims align with the fund, yes, the parents should invest in mutual funds for the minor, so as to avail tax benefits, extra income and boost long term financial stability.

Mutual Funds are beneficial to an economy and to the people investing in them, if they are run with integrity and efficiency, and with the current state of India’s economy, everything seems to be on the rise. Mutual Funds Investments are here, and they are here to stay, and you must educate yourself on their benefits, minor or otherwise.

To conclude, one has to make a decision whether to invest in one’s own name or investment in the child’s name to create a corpus for the minor child. One needs to keep in mind the control, paper work, tax point of view, any income that gets generated will anyway get clubbed with that of the parents. And then accordingly the tax has to be paid. Therefore, evaluate the need to invest and then decide, keeping emotions aside. Emotions usually takes precedence in case of minor child and one needs to understand the practicality and the objective of investments.

Create a Blue Book of Wealth for your Spouse and dependent it’s the best gift you can give them

Dr. Navin Punjabi, Assistant Professor & Director Placements H R College of Commerce & Economics, Mentor Board of Industry-Academia Partnerships (BIAP)

The view & opinions expressed in this article are personal and do not reflect the views of the authors employer or any other institution that the author is affiliated to.

February being the month of love and romance couples take a lot of vows to love, care & share. At the dinner table most couples love to discuss movies and the next holiday, personal finance is the most neglected of all. Every spouse thinks about the future of their family & dependents and make investments in Fixed Deposits, Mutual Funds, Equity, Life Insurance and Mediclaim. The biggest challenge is such decision are usually made in isolation from one’s spouse or are done at different points in time during the life cycle, which one may forget or may not have informed the spouse. For instance, one may forget that he or she has a life insurance cover for free linked to a subscription of a premium credit card. Or during a job switch one forgot to withdraw or transfer the provident fund money!!!

The idea is to make personal finance a family time just like in the old days where kids and parents used to play Monopoly, Snakes & ladders or Ludo. Investment should also be played like an educative game and parents discuss the do’s and don’ts of the game. Moreover, couples should share among themselves the investment made by them in different asset classes. The idea is to make personal finance collaborative and co-creation activity.

Families should take effort to make a ‘Blue Book of Wealth’ where they list all their accounts let say a dedicated page for writing all the Bank Accounts with bank account numbers, the holding pattern and the mode of operation say Single, Joint, Either or Survivor etc. One should also check and write if nomination is registered for their bank account by doing this the spouse or the family member is made aware of the banking details and in an eventuality the family member knows who can operate the account etc. Similar pages should be created for Mutual Fund Investment listing all folio no’s, holding patterns and mode of operation and also checking the nomination in the same.

A dedicated page on Mediclaim & life Insurance, health insurance with the telephone no of Third Party Administrator, Policy No and Cashless Procedure listed for the family members to refer incase a medical emergency arises.

One page on stock market investment like the Demat account no, trading client id, Nomination’s.

One may go ahead and write mobile number & contact details of Charted Accountant, Lawyer who made the will, Family Doctor, Stock Broker, Wealth Manager or Financial Planner, Insurance agent to facilitate ease of operation as one cannot ignore the personal touch in the financial services sector.

Usually many of us opt for a premium debit card or credit card which comes with a life cover option one may be want to list the details of such insurance covers.

The most difficult of all in small cash transaction which may occur for instance if you gave a small cash loan of INR 20,000 to a friend one should record it. Cash Transactions were a major concern for businessmen who were in business which had a lot of cash transactions, keeping track was always a concern and moreover in case of any eventuality the spouse of a business person is clueless what is the cash one owns or owes.

One may contemplate as to why do we call this “Blue Book on Wealth” well it’s the authors favorite color you can call it any color book or your book. The idea of this article was to sensitize the investor on the drawback of not sharing about finances with spouse or your loved ones. Moreover, the idea is to co-create and plan finances together which makes the spouse more responsible in taking financial decisions and creates more financial understanding between family members. The next article will tell you how to make investments for minors.

Please fee free to comment and share your views.The author can be reached at you can follow the author at

Swach Bharat Cess v/s Swach Bahrat mind-set – Can the Youth Play a Role

The views expressed by the author are personal and not of the institute where Dr. Navin Punjabi is employed or affiliated. I would like to acknowledge my students Mr. Ashish Sharma, Ms. Fatima and thier class to bring this interesting debate to class. You can email your thoughts at

It was around 6.30 pm and I had just finished a case of ‘Role of a manager’ and on my way down just outside the gate I saw my student at the Panwalla lighting his cigarette!!! Looking at me out of respect he disposed his cigarette and approached me to discuss about the complicated role of a manager and the discussion just got hotter with politics at workplace and the role of manager. I offered him a ride and asked him if I could drop him somewhere on my way home and he agreed.

The discussion moved from role of a manager to the the most recent topic ‘Swatch Bharat Abhiyan’ The topic of ‘SWACH BHARAT ABHIYAN’ has been going around for quite some time now. It started when our honourable Prime Minister Modiji picked up a broom to clean up the streets of our country on 02nd October, 2014 with the objective of intimidating the people to do the   same! Our prime minister cleaned the streets himself and after he did so, he nominated 09 famous celebrities to join the challenge and then asked them to further nominate 9 other people to clean up the streets with a view of covering the whole of India slowly and gradually.
So basically this was our prime minister’s attempt to create an Indian version of the ‘ALS ice bucket challenge’ which time will tell if it can achieve the same success as the American awareness raising campaign! Funny isn’t it? How we enjoyed putting ice over our heads for a disease that hasn’t even reached India but we’re ashamed of cleaning up the garbage of our neighbourhood which is actually the cause of most of the diseases that we suffer from today!! Oh, forget cleaning, many are littering it and the worst part is that they don’t even care.
F.Y.I- you are liable to pay a fine Of Rs.250 for every piece of paper/wrapper/etc. you throw anywhere except a garbage bin! But the question here is who’s going to make you pay? Because appointing man force to monitor in every street of our country, trying to catch the offenders from our 122 billion people littering around…..doesn’t quite seem possible, does it?

So to overcome this limitation our government came up with something new…Yes!! A brand new cess! It’s called ‘The swach bharat cess’ This new cess is a cess levied on all the services which are taxable under chapter VI the Indian finance act 2015 at (50 basis points ) 0.5 percent of the value of services provided. The proceeds collected via this new tax will be used for cleaning, maintaining hygiene and promoting and creating awareness about health care. But, will this work? This tax was imposed on 15th November 2015 This cess is levied as an indirect tax i.e it does not differentiate between people of high or low income levels and also is difficult to evade. Therefore for people of medium to low income affects the consumption and saving Patterns. Apart from that the swach bharat cess also reflects a poor image of our country’s public finance, where to provide cleanliness and basic sanitation to its citizens the government has to impose an additional cess!
India is one of the country which has the highest taxes and the country with one of the highest tax system imposing a cess to keep the country clean may not be perceived well by many.
As a academician I thought let me take the opinion of the youth so I organized a small debate in class to test if the newly imposed cess will create a positive mind-set and encourage citizens to keep their neighbourhood clean !!!. The students came out with shocking statements like many people would perceive this cess as a service fee which they are paying to the government to keep this country clean so why should I take the pain.

This almost got me thinking that ‘do we need this new cess?’
Is this a vicious cycle where government cleans the country and the citizens litter again and the cycle goes on!!!

So maybe we don’t need a ‘swach bharat cess’ instead we need a ‘swach bharat mind-set’! You don’t like to clean things up? Fine. At least try not to make it dirtier. Use garbage bins. Many might say, ‘Ya ya don’t get started’, we have learnt this in our morals class, many might whine about how there are no garbage bins on the streets. You can easily find a dust bin in the city. There are government bins installed at places, you might find a bin outside a restaurant, even every panwalla keeps a bin now a days. These bins just go unnoticed or one is hesitant to use the bin as ne has not made any purchase from that panwalla. I personally feel the panwalla is an amazing channel to ensure cleanliness. After product, price, place and promotion he is the fifth P in the world of marketing. More than one Panwalla is present in every lane and if every panwalla has a dustbin and the government sensitise the masses the problem of cleanliness can be resolved to a great extent.

The debate in class had amazing outcomes few of the students recommended a “Swatch Baharat Amabssador program” (A youth volunteer Program to sensitise the citizens on swatchata). The youth is really excited to help and faculty members have to encourage and channelize the youth in the right direction. An Ashoka emblem certificate signed by the Honourable Prime minister of the country itself will be a great motivator for the youth to come forward and take the cause of cleanliness. I am aware the NSS and NCC wings of various colleges are propagating the cause of swach bahart, however an ambassador program encourages the youth to aspire to this new cause and not one of the cause. Well next time maybe when you’re walking down the street and you finish your packet of chips. Try holding on to the wrapper, keep it in your hands, your eagerness to free your hands will find you a dustbin within 10 minutes. I can assure you that!! So let’s get things right people!

Let’s maintain our surroundings, let’s make our ‘Bharat’, ‘Swach Bharat’ and Who knows, if the government might just get done away with this new cess if it feels it’s not needed anymore.

If you have any reflections or opinion please feel free to comment below.

Dr. Navin Punjabi is an Assistant Professor at H R College of Commerce & Economics and visiting faculty at leading institutes like BSE Training Institute, NITIE and other leading B-Schools. He can be reached at and you can follow him on


I am Navin Punjabi, faculty at H R College of Commerce & Economics, Mumbai, India. Welcome to my blog. I use this blog to keep in touch with my current and former students, Teachers and Students at other institutes and friends the industry.