some terms Explained

1. THE ENVIRONMENT (PROTECTION) ACT, 1986
 The main objective of this Act is to provide the protection and improvement of
environment (which includes water, air, land, human being, other living creatures, plants,
micro-organism and properties) and for matters connected therewith. There is a
constitutional provision also for the environment protection. Article 48A, specify that the
State shall endeavor to protect and improve the environment and to safeguard the forests
and wildlife of the country and every citizen shall protect the environment (51 A). The
Environment (Protection) Act is applicable to whole of India including Jammu & Kashmir.
 Environment: It includes water, air, and land and the inter-relationship which exists
among and between water, air and land and human beings, other living creatures, plants,
micro-organism and property.
 Environmental Pollution: It means any solid, liquid or gaseous substances present in such
concentration as may be or tend to be injurious to environment and human being are
known as pollutant and presence of any pollutant in the environment in such proportion
and concentration that has bearing on health and environment is termed as
"Environmental Pollution".
 Handling: In relation to any substance, it means the manufacturing, processing, treatment,
packaging, storage, transportation, use, collection, destruction, conversion, offering for
sale, etc.
 Occupier: It means a person who has control over the affairs of the factory or the premises,
and includes, in relation to any substance, the person in possession of the substance.
 The Act provide power to make rules to regulate environmental pollution, to notify
standards and maximum limits of pollutants of air, water, and soil for various areas and
purposes, prohibition and restriction on the handling of hazardous substances and
location of industries (Sections 3-6).
 The Central Government is empowered to constitute authority or authorities for the
purpose of exercising of performing such of the powers and functions (Sec 3), appoint a
person for inspection (Sec 4), for analysis or samples and for selection or notification of
environmental laboratories. Such person or agency has power to inspect or can enter in
the premises or can take samples for analysis (Secs 10, 11).
 According to the section 5, the Central Government may issue directions in writing to any
person or officers or any authority to comply. There could be closure, prohibition of the
supply of electricity or operation or process; or stoppage or regulation of the supply of
electricity or water or any other service.
Section 6 empowers the government to make rules to achieve the object of the Act.
 Persons carrying on industry, operation etc. not to allow emission or discharge of
environmental pollutants in excess of the standards (Sec 7). Persons handling hazardous

2. substances must comply with procedural safeguards (Sec 8) and occupiers must furnish
the information to authority.
5 essential objectives of economic planning in India
Planning without an objective is like driving without any destination. There are generally
two sets of objectives for planning, namely the short-term objectives and the long-term
objectives. While the short-term objectives vary from plan to plan, depending on the
immediate problems faced by the economy, the process of planning is inspired by certain
long term objectives. In case of our Five Year plans, the long-term objectives are:
(i) High Rate of Growth
All the Indian Five Year Plans have given primary importance to higher growth of real
national income. During the British rule, Indian economy was stagnant and the people were
living in a state of abject poverty. The Britishers exploited the economy both through
foreign trade and colonial administration. While the European industries flourished, the
Indian economy was caught in a vicious circle of poverty. The pervasive poverty and misery
were the most important problem that has to be tackled through Five Year Plan.
(ii) Economic Self Reliance
Self reliance means to stand on one’s own legs. In the Indian context, it implies that
dependence on foreign aid should be as minimum as possible. At the beginning of planning,
we had to import food grains from USA to meet our domestic demand. Similarly, for
accelerating the process of industrialization, we had to import, capital goods in the form of
heavy machinery and technical know-how. For improving infrastructure facilities like
roads, railways, power, we had to depend on foreign aid to raise the rate of our investment.
(iii) Social Justice:
Social justice means to equitably distribute the wealth and income of the country among
different sections of the society. In India, we find that a large number of people are poor;
while few lead a luxurious life. Therefore, another objective of development is to ensure
social justice and to take care of the poor and weaker sections of the society. The Five-Year
Plans have highlighted four aspects of social justice. They are:
(i) Application of democratic principles in the political structure of the country;
(ii) Establishment of social and economic equity and removal of regional disparity;

3. (iii) Putting an end to the process of centralization of economic power; and
(iv) Efforts to raise the condition of backward and depressed classes.
Thus the Five Year Plans have targeted to uplift the economic condition of socio-
economically weaker sections like scheduled caste and tribes through a number of target
oriented programmes. In order to reduce the inequality in the distribution of landed assets,
land reforms have been adopted. Further, to reduce regional inequality specific
programmes have been adopted for the backward areas of the country.
(iv) Modernization of the Economy:
Before independence, our economy was backward and feudal in character. After
attainment of independence, the planners and policy makers tried to modernize the
economy by changing the structural and institutional set up of the country. Modernization
aims at improving the standard of living of the people by adopting a better scientific
technique of production, by replacing the traditional backward ideas by logical reasoning's
and bringing about changes in the rural structure and institutions.
(v) Economic Stability:
Economic stability means to control inflation and unemployment. After the Second Plan,
the price level started increasing for a long period of time. Therefore, the planners have
tried to stabilize the economy by properly controlling the rising trend of the price level.
However, the progress in this direction has been far from satisfactory.
Thus the broad objective of Indian plans has been a non-inflationary self-reliant growth
with social justice.
Quality Circle
A quality circle is a volunteer group composed of workers (or even students), usually
under the leadership of their supervisor (but they can elect a team leader), who are
trained to identify, analyse and solve work-related problems and present their
solutions to management in order to improve the performance of the organization,
and motivate and enrich the work of employees. When matured, true quality circles
become self-managing, having gained the confidence of management.
Quality circles are an alternative to the de humanizing concept of the division of labour,
where workers or individuals are treated like robots. They bring back the concept of
craftsmanship, which when operated on an individual basis is uneconomic, but when used
in group form (as is the case with quality circles), it can be devastatingly powerful and
enables the enrichment of the lives of the workers or students and creates harmony and
high performance in the workplace. Typical topics are improving occupational safety and

4. health, improving product design, and improvement in the workplace and manufacturing
processes.
Student quality circles work on the original philosophy of Total Quality Managed Student
quality circles work on the original philosophy of Total Quality Management. The idea of
SQCs was presented by City Montessori School (CMS) Lucknow India at a conference in
Hong Kong in October 1994. It was developed and mentored by duo engineers of Indian
Railways PC Bihari and Swami Das in association with Principal Dr. Kamran of CMS
Lucknow India. The World Council for Total Quality & Excellence in Education was
established in 1999 with its Corporate Office in Lucknow and head office at Singapore. It
monitors and facilitates student quality circle activities to its member countries which are
more than a dozen. SQCs are considered to be a co-curricular activity.
Journal
An accounting record where all business transactions are originally entered. A journal
details which transactions occurred and what accounts were affected. Journal entries are

5. usually recorded in chronological order, and using the double-entry method
of bookkeeping.
1. Is the book of prime entry.
2. As soon as transaction originates it is recorded in journal
3. Transactions are recorded in order of occurrence i.e. strictly in order of dates.
4. Narration (brief description) is written for each entry.
5. Ledger folio is written
6. Relevant information cannot be ascertained readily e.g. cash in hand can't be found out
easily.
7. Final accounts can't be prepared directly from journal.
8. Accuracy of the books can't be tested.
9. Debit and credit amounts of a transaction are recorded in adjacent columns.
10. Journal has two columns one for debit amount another for credit amount.
11. Journal is not balanced.
12. With the computerization of accounting journal may not be used for routine
transactions like receipts, purchases, sales etc
Ledger
An accounting book of final entry where transactions are listed in separate accounts.
1. Is the book of final entry.
2. Transactions are posted in the ledger after the same have been recorded in the journal.
3. Transactions are classified according to the nature and are grouped in the concerned
accounts.
4. Narration is not required.

6. 5. Folio of the journal or sub-journal is written.
6. Since transactions of particular nature are grouped at one place therefore relevant
information can be ascertained.
7. Ledger is the basis of preparing final accounts.
8. Accuracy of the books is tested by means of list of balances.
9. Debit and credit amounts of a transaction are recorded in two different sides of two
different accounts.
10. Ledger has two sides: left side is debit side right side is credit side.
11. Every account in the ledger is balanced at appropriate time.
12. Ledger cannot be avoided. However it may be loose leaf ledger or a computerized
ledger. But ledger is a must.
Perpetuity
A perpetuity is an annuity in which the periodic payments begin on a fixed date and
continue indefinitely. It is sometimes referred to as a perpetual annuity. Fixed coupon
payments on permanently invested (irredeemable) sums of money are prime examples of
perpetuities. Scholarships paid perpetually from an endowment fit the definition of
perpetuity.
The value of the perpetuity is finite because receipts that are anticipated far in the future
have extremely low present value (present value of the future cash flows). Unlike a typical
bond, because the principal is never repaid, there is no present value for the principal.
Assuming that payments begin at the end of the current period, the price of a perpetuity is
simply the coupon amount over the appropriate discount rate or yield, that is
Where PV = Present Value of the Perpetuity, A = the Amount of the periodic payment, and r
= yield , discount rate or interest rate.
To give a numerical example, a 3% UK government War Loan will trade at 50 pence per
pound in a yield environment of 6%, while at 3% yield it is trading at par. That is, if the face

7. value of the Loan is £100 and the annual payment £3, the value of the Loan is £50 when
market interest rates are 6%, and £100 when they are 3%.
The term annuity is used in finance theory to refer to any terminating stream of fixed
payments over a specified period of time.
An ordinary annuity (also referred as annuity-immediate) is an annuity whose
payments are made at the end of each period (e.g. a month, a year). The values of an
ordinary annuity can be calculated through the following:
Let:
r = the yearly nominal interest rate.
t = the number of years.
m = the number of periods per year.
i = the interest rate per period.
n = the number of periods.
Note:
Also let:
P = the principal (or present value).
S = the future value of an annuity.
R = the periodic payment in an annuity (the amortized payment).