COST INFLATION INDEX (CII)- Cost Inflation Index (CII) is used to measure the inflation when computing long-term capital gain on sale of Fixed Income and Fixed Assets. It is used only in fixed income, property and Gold Funds. But, it not used in equity-based products because in equity long term gains are tax-free. Capital gains are either short term or long term. Short term Capital Gains are earned if fixed assets are sold before 3 years. Long Term Capital gain is earned if it is sold after 3 years. Thus, in the case of short-term gain all gains will be added to your taxable income and taxed as per your current income tax slab.   But, for those who earn long-term capital gain can enjoy the indexation benefit where your purchase value will be increased according to the cost inflation index. So, in simple terms, the assets purchased before three years will not cost same as compared to present time. Thus, the government gives you the benefit of inflation while computing Long term Capital Gain. The benefit of inflation is provided by the following method:   The cost of the asset purchased three years ago will be less if you will consider the inflation rate over the past three years. Thus, when the government calculates Long term Capital gain they will not consider the purchase price of the asset on which you bought the asset. But, will instead inflate the purchase value using the cost inflation index (CII) and that value will be considered as the purchase price for computing Long term Capital Gain.   To simplify your inflation calculation CBDT release cost inflation index every year on the budget announcement. This index helps you to calculate the long-term gains and here is the formula to calculate it:   Indexed cost of acquisition = Actual cost of acquisition * CII of Year of Sale / CII of year of purchase


Indexed cost of acquisition = Actual cost of Acquisition * CII of Year of Sale / CII of year of purchase   The cost of Inflation Index is available from 1981 and asset purchased before that period will be considered to be 1981 value. Cost Inflation Index (CII) Chart is as follows:

Financial Year

Cost of Inflation Index (CII)

2016 – 17


2015 – 16


2014 – 15


2013 – 14


2013 – 14


2012 – 13


2011 – 12


2010 – 11


2009 – 10


2008 – 09


2007 – 08


2006 – 07


2005 – 06


2004 – 05


2003 – 04


2002 – 03


2001 – 02


2000 – 01


1999 – 00


1998 – 99


1997 – 98


1996 – 97


1995 – 96


1994 – 95


1993 – 94


1992 – 93


1991 – 92


1990 – 91


1989 – 90


1988 – 89


1987 – 88


1986 – 87


1985 – 86


1984 – 85


1983 – 84


1982 – 83


1981 – 82


Tag: Cost Inflation Index 2016-17, Cost Inflation Index 2015-16, CII,Cost Inflation Index In the case of debt funds there are two ways for long term Capital gains: (a) If you don’t want to choose indexation then you can simply pay 10% of gain as tax (b) Otherwise, you can choose indexation which is recommended and beneficial also   To get clarity on computation please refer below example:  
Investment In Debt fund
Invested amount in FY 2011-12 1 Lakh
Term 5 year
Rate of Return @ 9% p.a.
Maturity Amount  before tax INR 153862.40
Indexation on Invested Amount INR 137703.68 (Invested amount X Cost of Inflation Index of 2015-16 / Cost of Inflation Index of 2011-12)
Gain Earned before tax INR 16155.4 (Indexed gain)
Applicable Tax rate 20% irrespective of slab on indexed gain
Tax Charged INR 3231.08
Total Maturity after Tax INR 150631.32
  Although being a client of Investmentlocker  you don’t have to worry about calculating this. As we provide this on our portfolio portal for any year which automated. But those who are not associated with Investmentlocker, then you can calculate it though the help of formula. If you have different purchase rates then you have to calculate every purchase entry differently. In that case, you have to follow FIFO method where the indexed year will be used as per the purchased year.    ]]>


NON-RESIDENT INDIAN (NRI) NRI is any person holding Indian Passport but has immigrated to some other country for the duration of 6 months or more for residence, employment purpose, and vacation circumstances that indicate intention to stay out of India for an indefinite period. Following people are also considered NRI:

  • If a person’s stay in India is less than 182 days during the preceding financial year, then also the person will be considered NRI.
  • Citizens of India who are working abroad with foreign government agencies like United Nations Organisation (UNO), affiliates, International Monetary Fund (IMF), World Bank etc. on assignment.
  • Officials of Central and State Government and Public Sector undertaking deputed abroad on temporary assignments or posted to their offices, including Indian diplomat missions, abroad.
Non-resident foreign citizens of Indian Origin are treated on par with non-resident Indian citizens.


For availing benefit of opening and maintaining bank account and investments in securities/shares in India: Any foreign citizen (other than a citizen of Pakistan or Bangladesh) is considered of Indian Origin, if:
  • Indian passport is held by him anytime throughout life
  • Himself or either of his parents or grand-parents was Indian citizen according to Citizenship Act as per Indian Constitution
  • A spouse( should not be a citizen of Bangladesh or Pakistan) of an Indian citizen /Indian origin if Bank account is opened or investment is made in share/securities in India provided the Bank accounts are opened or investment is made in shares or securities jointly with their spouse
For the purpose of Investment in immovable properties: Any foreign citizen (other than a citizen of Pakistan, Sri Lanka, Afghanistan, Nepal or Bangladesh) is considered of being Indian Origin, if,
  • Indian passport is held by him anytime throughout life
  • Person himself or either of his parents or grand-parents was Indian citizen according to Citizenship Act as per Indian Constitution
If any person does not fall in category of a resident or not ordinarily resident, he / she will be non-resident.


For an NRI to make any type of investment in India needs to have Bank account from below mentioned options:
  • Non-Resident Ordinary Rupee Account (NRO) –
  • NRO account is mainly used to manage the Indian income of NRIs which can be received in India in any form of dividend, rent or pension
  • This kind of account is not useful if Indian earnings need to be transferred abroad as the limit for this account is 1 million USD.
  • Also, it needs to be certified by CA to provide tax paid certificate before repatriation.
  • Foreign funds can also be deposited in this account.
  • The interest earned from this account is taxable in India.
  • Depositing and managing the earnings in India should be the prime use of this account
  • Non-Resident External Rupee Account (NRE) –
  • In this kind of account in which foreign currency funds are converted into Indian currency
  • In this type of account, foreign currency funds are converted into Indian currency at the current rate at the time of conversion.
  • Funds in the NRE account, as well as the principal amount and interest, are completely repatriable
  • NRE account can be opened as NRE fixed deposit account, recurring or savings account.
  • In India Interest earned and the principal amount is not taxable
  • NRE account is most suitable for NRIs who wish to transfer their foreign income to Indian accounts
  • Foreign Currency Non-Resident Bank Deposits (FCNR) –
  • FCNR is a kind of fixed or term deposit account where money can be deposited in foreign currency.
  • Thus, the fluctuation can be avoided in the exchange rate. Also, you can open the account jointly with the resident of India.
  • Minimum and maximum maturity period for deposits is 1 and 5 years respectively. The principal amount is taxable whereas the interest earned is tax free


  • Bank Fixed Deposits-
One of the most common investment options for NRIs is opening Fixed Deposit in Indian Bank who deals in foreign exchange. NRIs are provided high-interest rate by Banks on fixed deposits. They can open any out of the mentioned term deposit accounts in India i.e. NRE account, NRO account or FCNR account (As explained in above section).
  • Mutual funds
NRIs can also invest in Mutual funds. For investment in mutual funds, NRI should have the any out of the above mentioned 3 Bank accounts i.e. NRE, NRO or FCNR. NRI also need to provide a rupee Demand draft or cheque from NRO/NRE Account. Also, investment amount should be in Indian currency and direct debit/credit can be done from NRE/NRO account.Although, according to some countries laws NRIs cannot invest in Mutual funds in India.
  • Stock Market-
Another option available to NRI for investment in India is in Stock market under RBI’s Portfolio Investment Scheme(PINS).But, for investment in PINS, the NRI needs to take permission under PINS scheme for sale/purchase of shares in India.There is a limit on the maximum investment. It cannot be more than 10% of paid-up capital of the Indian company.Demat account and brokerage account needs to be opened with SEBI registered brokerage firm by NRIs.Stock market transactions can be done via stock broker only. Therefore below mentioned are the pre-requisites for an NRI to invest in equity market:
  • NRE or NRO Bank Account
  • Trading account with SEBI authorised broker
  • Demat account for holding shares
  • PIS approval for stock market trading
  • Allowed number of account per individual is one
  • But, trading in all Indian stocks is not allowed. As NRIs, eligible list of stock is published by RBI
Apart from it below mentioned is the things that are not allowed to NRIs:
  • Intraday Trading
  • Short selling in India.
  • Real Estate Sector-
Investing in property/real estate is one of the most common and lucrative investment options for NRIs. They are eligible to invest in both commercial and residential property that too as much as they want, as there is no restriction on the number of properties owned. But below mentioned are the restrictions that NRI face while investing in real estate:
  • They cannot buy agriculture land
  • They cannot buy farm house or plantations
  • Although inheritance/gift of agriculture land is acceptable
One needs to make a note that property selling has some restrictions by FEMA (Foreign Exchange Management Act),especially for repatriation transactions.It is advisable for NRI to hire professional who can guide you with legal documentation procedure during purchase/sale.
  • Investment in Bonds/Government Securities :
NRIs can also invest in Bonds and government securities. Fixed return is earned by NRIs on these bonds/government securities. In case the purchasing of these bonds/government securities is done via NRE/FCNR accounts then the proceeds are easily repatriable to their country of residence.
  • Certificate of Deposits-
NRIs are given an option for investment on the repatriable basis on Certificate of Deposits. Certificate of Deposits is either issued as a Promissory note or in demat form. This is non-negotiable money instrument. Interest earned from these is higher than fixed deposits. Also, the maturity period is 7 days to 1 year.CDs are most suitable for NRIs having short-term financial goals.
  • National Pension scheme(NPS)
NPS is another good option of investment for NRIsbetween 18 to 60 years of age. For investment in NPS holding Indian citizenship is mandatory, in case the NRI gives up the citizenship of India the NPS account will get closed.


  • NRIs are liable to pay taxes on earned income from India.
  • Capital gains from property sale, shares and securities or salary earned in India is Taxable income
  • USA/Canada based NRI’s cannot invest in some of the mutual fund houses. Therefore this needs to be checked before investing
  • Double taxation can be avoided by NRIs but DTAA or Double Taxation Avoidance Agreement needs to be checked between the countries.
  • Certain investment options like PPF, senior Citizen scheme, NSC etc.. are not available to NRIs

What is AADHAAR?

AADHAAR Aadhaar is a free service launched to provide 12 digits unique identification to Indian residents based on their biometrics i.e. thumb impression and retina scan. Objective of Aadhaar is to keep the biometric and demographic data of residents in a centralised location Other features about Aadhaar are as follows:

  • The unique number is provided without any bias of caste, creed & religion.
  • It serves as official Identity and address proof for Government and non-government official requirements
  • MNREGA workers can receive their wages directly in bank accounts
  • It can even facilitate the passport procedure
  • AAdhaar has a provision that it can be easily linked with Voter ID, Bank account and Cooking gas connection, Pension account, pension account
  • Aadhaar details can be updated online and offline


    • Aadhaar can be applied online
    • One can have more than one Aadhaar
    • UIDAI information is accessible to others
  • It is mandatory to have Aadhaar
  • Aadhaar can replace other identity proofs
  • It is costly to get Aadhar


  • You need to identify the Aadhaarcenter near you (To identify the nearest center you can check online
  • Visit the centre along with photograph, identity and address proof
  • Application form can be taken from the centre or it can be downloaded online
  • Application needs to be filled and submitted
  • The person responsible will enter the details and take your thumb impression and retina scan
  • After data entry you will be asked to cross check the details entered in the system
  • If the information entered is correct the person will submit the same and will hand over the enrolment slip. This slip contains complete information and the same can be used to track the status of your application that whether it has been dispatched or not
  • The information provided will be verified before the aadhaar is generated and dispatched
  • Till the time aadhaar is not mailed to your contact address you can check the status of your application online


  1. Visit
  2. Enter all the details required like enrolment number as mentioned on Acknowledgement slip, full name, Pin code etc.
  3. After filling all the boxes Click on “Get One Time Password”
  4. OTP will be received on registered mobile Number
  5. OTP needs to be entered in the box and click on “Validate and Download”
  6. Open it using the password and then take the print of the aadhaar card


In case of change in any of the following “Name, Date of Birth, Address and Mobile Number”; individual has an option to update the same online and through post using below mentioned step: Updating information Online:
  • Visit or
  • Enter the details asked and click on “Get OTP”
  • Enter the text in the image and enter OTP
  • New webpage will open
  • Enter the details that need to be updated
  • Depending on the nature of change upload the supporting documents as accepted
  • You need to select the BPO Service Provide and submit yourrequest. Also, download /Print Update Request copy.
Note: You should have access to previously registered mobile number as OTP will be sent to that number. In case you have lost that number then you need to visit the nearest centre for the same. Updating information through Post: Note: It is mandatory to write Mobile Number
  • Depending on the nature of change you need to attach self-attested supporting documents
  • In case of a child whose age is less than 5 years, parent/guardian can sign document copies
  • You need to make sure that AADHAAR number is clearly mentioned on all the copies of documents attached
  • Put the complete form along with supporting documents in an envelope and mention “Aadhaar Update/Correction” on top of it
  • Post the envelope to mailing address- UIDAI Regional Office, KhanijaBhavan, No. 49, 3rd Floor, South Wing, Race Course Road, Bangalore–01
  • Once the data is successfully validated by UIDAI the communication will be done to you and you will receive updated Aadhaar card


As we are aware in order to get the Aadhaar you need to submit proof of identity and proof of address. Thus, there is a list defined for document that serves as “Proof of Identity” and “Proof of address”. It is mandatory for each individual  to carry one “Proof of Identity” and one “Proof of address” at the Aadhaar centre. However, in case of minor all you need to submit is parent’s “Proof of Identity and address” along with it proof of relation. Below mentioned is the list of “Proof of Identity” accepted:
  • Passport
  • Voter ID Card
  • Arms License
  • Ration/ PDS Photo Card
  • NREGS Job Card
  • Photo ID issued by Recognized Educational Institution
  • Address Card having Name and Photo issued by Department of Posts
  • Driving License
  • Government Photo ID Cards/ service photo identity card issued by PSU
  • Photo Bank ATM Card
  • Pensioner Photo Card
  • CGHS / ECHS Photo Card
  • PAN Card
  • Photo Credit Card
  • Kissan Photo Passbook
  • Freedom Fighter Photo Card
  • Certificate of Identity having photo issued by Gazetted Officer or Tehsildar on letterhead 18. Disability ID Card/handicapped medical certificate issued by the respective State/UT Governments/Administrations.
Below mentioned is the list of “Proof of Address” accepted:
  • Passport
  • Voter ID Card
  • Ration Card
  • Electricity Bill (not older than 3 months)
  • Water bill (not older than 3 months)
  • Property Tax Receipt (not older than 3 months)
  • Telephone Landline Bill (not older than 3 months)
  • Government Photo ID cards/ service photo identity card issued by PSU
  • Insurance Policy
  • Passport of Spouse
  • Signed Letter having Photo issued by Recognized Educational Instruction on letterhead 17. NREGS Job Card
  • Arms License
  • Pensioner Card
  • Credit Card Statement (not older than 3 months)
  • Signed Letter having Photo issued by registered Company on letterhead
  • Fighter Card
  • CGHS / ECHS Card
  • Income Tax Assessment Order
  • Signed Letter having Photo from Bank on letterhead
  • Certificate of Address having photo issued by MP or MLA or Gazetted Officer or Tehsildar on letterhead
  • Certificate of Address issued by Village Panchayat head or its equivalent authority (for rural areas)
  • Address Card having Photo issued by Department of Posts
  • Vehicle Registration Certificate
  • Caste and Domicile Certificate having Photo issued by State Govt.
  • Registered Sale / Lease / Rent Agreement
  • Kissan Passbook
  • Gas Connection Bill (not older than 3 months)
  • Passport of Parents (in case of Minor)
  • Disability ID Card/handicapped medical certificate issued by the respective State/UT Governments/Administrations
  • Driving License
  • Bank Statement/ Passbook
  • Post Office Account Statement/Passbook
Below mentioned is the list of supported Proof Of Relationship (POR)
  • PDS Card
  • MNREGA Job Card
  • CGHS/State Government/ECHS/ESIC Medical card
  • Pension Card
  • Valid Passport
  • Army Canteen Card
  • Birth Certificate issued by Registrar of Birth, Municipal Corporation and other notified local government bodies like Taluk, Tehsil etc.
  • Any other Central/State government issued family entitlement document
Below mentioned is the list of Proof of Date of Birth (DoB):
  • Passport
  • Birth Certificate
  • Certificate of Date of Birth issued by Group A Gazetted Officer on letterhead
  • SSLC Book/Certificate


Aadhaar can be linked with following: Bank Account
  • Aadhaarcan be linked through Net banking. However, it is not mandatory that all the banks provide this service
  • Aadhaar can be linked using SMS service. For this you need to send the aadhaar number to a number. Format and number is decided by bank and you need to ask bank for the same
  • Aadhaar can be linked offline. For this you need to visit the branch and ask them for the form to update the aadhaar number with your bank account
Voter ID
  • You need to visit
  • Search by using Name & other details or by using EPIC Number mentioned on Voter ID
  • After pressing View Details button you can check whether details entered are correct or not
  • After detail confirmation click on “Feed Aadhaar Number” Button
  • Now desired information needs to be filled and submit is to be pressed
  • Success message will be received and your Aahaar will be linked to your Voter ID
LPG Connection Aadhaar can be linked using LPG Subsidy form
  • You need to complete the LPG Subsidy form and deposit it to the distributor
  • Aadhaarnumber and Bank account details need to be filled
  • Distributor will link the Aadhaar number with your LPG connection
Aadhaar can be linked using by sending SMS SMS needs to be sent on the number provided by the LPG Company Distributor can help you with the number Aadhaar can be linked through Phone Call You can dial Toll free number 1800 2 333 555 to get the Aadhaar linked with LPG connection Aadhaar can be linked Online
  • Visit
  • Fill the complete details on “Resident Self Service” using drop down
  • Information to be provided is State, District. Benefit type, Scheme Name, Distributor Name, Consumer Number (This is mentioned on the LPG booklet), Mobile number and e-mail address
  • Press Submit button
Aadhaar can be linked using Company’s website You can also directly visit the company website to get Aadhaar linked: HP Gas (HPCL)]]>


CIBIL stands for Credit Information Bureau Limited. It is the first company established in India for providing Credit Information for individuals & non-individuals. Basically, they collect information about credit cards and loans from banks periodically (on monthly basis) and thus determine the Credit Information Report and Credit Score.They maintain those records and then on the request by any bank or lending agencies they provides that information to them.  


Credit Information Report (CIR) is a detailed report generated by the company. The report basically contains the CIBIL Score, Personal information, Contact Information, Employment Information, Account Information, and Enquiry Information along with Consumer Dispute Remarks.  


CIBIL Score is a three-digit number assigned to the individual or non-individual based on the credit information example loans taken and repayment of those loans, Payment of timely credit card dues, how well the person is maintaining mix of secured and unsecured loans Generally, this information is useful to lending agencies and bank to analyse and ascertain whether to approve the loan or not of that individual or non-individual.  


    • All the past repayments of loan are done or not
    • Repayments are done within due date or not
    • Previous loans writing offs
  • Maintaining mix of secured loans (Auto & Home loan) and unsecured loan (Personal loan &Credit Card)
  • How many loans have been taken in past


  • It serves as the first thing that is considered by the banks when a person applies for the loan. In other words, if your Score is high then you are likely to get you are likely to get your loan application approved as compared to people with low Score
  • Not only good Score helps in getting the loan approved. It can also help you in getting better interest rates as well.


  • All the past repayments of loan are done
  • Repayments are done within due date
  • There should be no writing off of the loans
  • Maintaining mix of secured loans (such as Auto, Home loan) and unsecured loan (such as Personal loan, Credit Card)
  • Fewer Loans have been taken in the past


  • CIBIL scores is only factor considered for getting loan application approved/rejected
One of the most common myths we come across is this. But we need to understand that CIR & CIBIL Score is the primary thing taken to consideration by banks. Apart from that, there are several factors that are considered example the income of the borrower, other underwriting policies etc. Thus, there can be instances that even after maintain good Score the loan application might get rejected because of some other factor.
  • Ideal Scenario is having Zero credit history
Some believe that if the person has not taken any loan/credit card in the past it will be considered ideal. But, this is not true as ideal credit history is one in which person has taken loan or credit card and has made timely payments.
  • Unable to get loans or credit card throughout life because of Low CIBIL score
This thinking is wrong as there different banks have different credit policies. Also, CIBIL Score & CIR is the primary criteria, not the only criteria. Thus, if your application got rejected in one bank it might get approved in another bank. But the interest rates could be high for low CIBIL Score individuals.
  • Low CIBIL scores ruin one’s credit reputation forever
Low CIBIL Score does not mean your credit reputation is ruined for life as CIBIL score improves if your credit history is improving. Also, the banks ask for fresh CIR & CIBIL report for fresh loan applications. Thus they get the updated information.
  • Record maintenance of defaulters by CIBIL
CIBIL does not maintain records of the defaulters rather it collates the credit history of the individuals. It provides this information to the Banks or financial institutions and they evaluate the CIR & CIBIL Score accordingly.
  • Supporting banks and financial institutions is sole purpose of CIBIL
CIR & CIBIL score not only helps banks or financial institution in analysing and approving loan applications but it also serves as the information providers to individuals about their finances. By having a look at CIR & CIBIL score they come to know about their Credit worthiness and thus can also improve it if required.
  • Making correction in credit reports is allowed to CIBIL
Making any kind of change in the CIR is not at all authorised CIBIL unless the change has been approved by the bank or financial institution.


  • Guarantor of a defaulter
If the person has given guarantee for friend/family for any loan, and the person defaults the loan then this will have an impact on the guarantor’s CIR & CIBIL Score. Thus, it is important to sign the loan guarantee only if you feel the person will not end up being a loan defaulter.
  • CIBIL Report comments
Most of us only read the Score and ignore the comments mentioned in CIR. Those comments hold great significance while approving the loan. As bank read the comments/remarks mentioned by the previous lenders. At times when a person defaults loan then the banks ask them to pay less amount. Once the amount has been paid the account gets closed but this incident is reported in the remarks section as “SETTLED”. This remark gives negative impact to the current loan application.
  • Tax History
People paying regular tax are more trusted by banks.
  • Identity mistook with a defaulter
In most of the cases if the house owned by you was previously of a defaulter then there are chances that your personal information might get mistaken of a defaulter. This might result in getting the loan application rejected, even when you possess a good Score. In such a scenario, you need to inform the same to the bank and reapply.
  • Limited History
If the person has not taken any loan/credit card in the past then there are chances of loan application getting rejected. As the banks will not be able to analyse that person will be able to repay the loan or not.
  • High Credit Utilisation
At times CIR reveals that the person is in habit of taking loans though the person is repaying the loans on time. Then also the banks check the credit utilisation ratio. The more close a person is of utilising maximum credit limit less will be the CIBIL Score.


NA or NH (No History) If the person has no credit history in the past 24 months or is new to credit system
1-2 If the credit history about a person is less than 6 months
350 – 550 Payment defaulting
550-650 Being fairly regular with payments
650-750 Better credit history then individual with score of 550-650
750-900 Extremely regular with credit payments and having an excellent credit history