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5th June Current Affairs

Model Tenancy Act

In News:

The Union Cabinet has approved the Model Tenancy Act (MTA).


States and Union territories can now adopt the Model Tenancy Act by enacting fresh legislation or they can amend their existing rental laws suitably.

Highlights of the Model Law:

Applicable prospectively and will not affect the existing tenancies.

Written agreement is a must for all new tenancies. The agreement will have to be submitted to the concerned district ‘Rent Authority’.

The law also speaks about roles and responsibilities of landlord and tenants.

No landlord or property manager can withhold any essential supply to the premises occupied by the tenant.

If tenancy has not been renewed, the tenancy shall be deemed to be renewed on a month-to-month basis on the same terms and conditions as were in the expired tenancy agreement, for a maximum period of six months.

Compensation in case of non-vacancy: On the expiry of extended period of six months of agreed tenancy period or the termination of tenancy by order or notice, the tenant shall be a tenant in default and liable to pay compensation of double of the monthly rent for two months and four times of the monthly rent thereafter.

A landowner or property manager may enter a premise in accordance with written notice or notice through electronic medium served to the tenant at least twenty-four hours before the time of entry.


It is an important piece of legislation that promises to ease the burden on civil courts, unlock rental properties stuck in legal disputes, and prevent future tangles by balancing the interests of tenants and landlords.

Need for a law in this regard:

Young, educated job seekers migrating to large metropolises often complain of onerous tenancy conditions and obscene sums of money as security deposits that they are asked to fork out to lease accommodation. In some cities, tenants are asked to pay security deposits amounting to 11 months of rent.

Also, some house owners routinely breach tenants’ right to privacy by visiting the premises unannounced for sundry repair works.

Whimsical rent raises are another problem for tenants, many of whom complain of being squeezed as “captive customers“.

Besides, Tenants are often accused of “squatting” on the rented premises, or trying to grab the property.

Digital tax in India

In News:

The United States recently announced 25% tariffs on over $2 billion worth of imports from six nations over their digital services taxes, but immediately suspended the duties to allow time for international tax negotiations to continue.


The US. Trade Representative’s office had approved the threatened tariffs on goods from Britain, Italy, Spain, Turkey, India and Austria after a “Section 301” investigation concluded that their digital taxes discriminated against U.S. companies.

The potential tariffs aim to equal the amount of digital taxes that would be collected from U.S. firms.

About the Digital Tax:

India was the one of the first countries to introduce a 6 per cent equalisation levy in 2016, but the levy was restricted to online advertisement services.

However, India introduced the digital tax in April 2020 for foreign companies selling goods and services online to customers in India and showing annual revenues more than INR 20 million.


India has expanded the scope of the equalisation levy over the last few years, to tax non-resident digital entities.

While the levy applied only to digital advertising services till 2019-20 at the rate of 6 percent, the government in April last year widened the scope to impose a 2 per cent tax on non-resident e-commerce players with a turnover of Rs 2 crore.

The scope was further widened in the Finance Act 2021-22 to cover e-commerce supply or service when any activity takes place online.

Since May 2021, this also includes any entity that systematically and continuously does business with more than 3 lakh users in India.

When will the tax not apply?

Offshore e-commerce firms that sell through an Indian arm will not have to pay.

This means if the goods and services sold on a foreign e-commerce platform are owned or provided by an Indian resident or Indian permanent establishment, they will not be subject to the two percent equalization levy.

Why was it imposed?

The equalisation levy was imposed “to give level playing field between Indian businesses who pay tax in India and foreign e-commerce companies who do business in India but do not pay any income tax here.

Which other countries impose such a levy on digital sellers?

France imposes a three percent digital services tax.

In the ASEAN region, Singapore, Indonesia, and Malaysia impose a digital service tax with Thailand announcing forthcoming plans to tax its foreign digital service providers.

Negotiations are underway at the Organisation for Economic Cooperation and Development (OECD) involving 140 countries to overhaul international tax rules given the fast growth of internet economies.

Why the United States Trade Representative (USTR) says that this tax is discriminatory?

First, it states that the DST discriminates against US digital businesses because it specifically excludes from its ambit domestic (Indian) digital businesses.

USTR also says the DST is discriminatory because it does not extend to identical services provided by non-digital service providers.

Why India says Digital services tax is not discriminatory? And why is it needed?

Business models employed by non-resident digital service providers obviate the need for a physical presence in India and profits earned here could easily escape the Indian income tax net. Hence, this kind of taxation is necessary.

Changing International Economic Order: Countries such as India which provide large markets for digital corporations seek a greater right to tax incomes.

Associated Concerns:

Eventually the tax may become a burden for Digital Consumers.

It could invite retaliatory tariffs (such as the latest one), as similar tariffs were imposed by the US on France.

It would also result in double taxation.

UNGA head

In News:

India has decided to vote in support of Maldives’ Foreign Minister Abdulla Shahid in the election of the President of the United Nations General Assembly.


This time the UNGA head will be chosen from the Asia-Pacific grouping.

Asia- Pacific group of the UN:

Consists of 53 Member States and is the second largest regional group by number of member states after the African Group.

Its territory is composed of much of the continents of Asia and Oceania with the exception of a few countries.

About UNGA:

The General Assembly is the main deliberative, policymaking and representative organ of the UN.

All 193 Member States of the UN are represented in the General Assembly, making it the only UN body with universal representation.

The President of the General Assembly is elected each year by assembly to serve a one-year term of office.

The presidency rotates annually between the five geographic groups: African, Asia-Pacific, Eastern European, Latin American and Caribbean, and Western European and other States.

How are the decisions taken?

Decisions on important questions, such as those on peace and security, admission of new members and budgetary matters, require a two-thirds majority of the General Assembly.

Decisions on other questions are by simple majority.

The Assembly has no binding votes or veto powers like the UN Security Council.

According to the Charter of the United Nations, the General Assembly may:

Consider and approve the United Nations budget and establish the financial assessments of Member States.

Elect the non-permanent members of the Security Council and the members of other United Nations councils and organs and, on the recommendation of the Security Council, appoint the Secretary-General.

Consider and make recommendations on the general principles of cooperation for maintaining international peace and security, including disarmament.

Discuss any question relating to international peace and security and, except where a dispute or situation is currently being discussed by the Security Council, make recommendations on it.