 |
| Sunday, October 15, 2000, Chandigarh, India   
|
Godrej Soaps goes
for demerger NRIs in Japan to
invest in Haryana Govt firm on levying
ST on iron & steel Birla opens
Monthly Income Plan Partnership exchange
for IT industry |
|
|||||||||||||||||||||||||||||
|
Local area development tax hits industry Captive power to plunge SEBs into darkness
|
|
Godrej Soaps goes
for demerger NEW DELHI, Oct 14 — The Rs 800 crore Godrej Soaps Ltd., the flagship company of the Godrej Group, has tentatively zeroed in on “Godrej Consumer Products” (GCP) and “Godrej Industries Limited” (GIL) as the names of the two companies which will be formed after the demerger. Under the proposed restructuring programme, the entire consumer products of Godrej Soaps, including all the brands and its related activities, will be transferred to GCP, while other business, including industrial activities and investments, will be hived off into a separate company, GIL. According to Mr Adi Godrej, Chairman of Godrej Soaps, the proposed restructuring is aimed at making GCP a focused consumer product and a debt free company. As on March 2000, the company had a loan of Rs 320 crore that has already been reduced to Rs 280 crore, and by March next year, the target is to make it a zero debt company, he added. In that pursuit, Godrej Soaps is divesting 20.3 per cent stake in Godrej Sara Lee Ltd for around Rs 170 crore. The divestment will be done through an offer for sale. Out of its
total holding of 48 per cent, the group has decided to divest 24 per cent stake in GCP, the Chairman said. Another one per cent will be divested by GCP Managing Director, Mr A. Mahendran. The balance 51 per cent stake in the company is being controlled by the US-based Sara Lee Corporation through its subsidiary Sara Lee Mauritius Holding Pvt. Ltd. Following this divestment, the management control of GCP will be transferred to Sara Lee. In another major decision, the group has also decided to focus on the information technology sector. “We have major plans in the infotech sector. The group is looking at setting up facilities for ERP solutions, remote services and call centres”, Mr Godrej said. However, the group has no major investment plan in the consumer products, he added. |
|
NRIs in Japan to invest in Haryana TOKYO, Oct 14 (PTI) — Japan-based Non-Resident Indians (NRIS) said today they would invest in Haryana in a big way especially in the electronics and automobiles sectors. An assurance to this effect was given by the Indian Chamber of Commerce and Industry of Osaka and Kobe (ICCIOK) during an interaction of its members with Haryana Chief Minister Om Prakash Chautala, who is on a three-day visit here to explore the possibility of direct foreign investment in the state. Chautala told ICCIOK, established by Japan-based NRIs, that his government would give priority in clearing the projects of multinational companies, which intended to invest directly in the state. Chautala arrived here on Wednesday in the second-leg of his foreign investment exploration mission after visiting Singapore and would leave for Korea from here. The Chief Minister said all the projects would be cleared by a high-powered committee functioning directly under his control and a “nodal officer” would be appointed for each company, whose investment was more than Rs 30 crore to avoid any delay. Chautala told ICCIOK that he had proposed to Singapore Prime Minister Goh Chok Tong setting up of a “Singapore corridor” for investors in Haryana to facilitate quick clearance of the projects. Prominent among the
NRIs who attended the meeting were ICCIOK president and Jupiter International Corporation Chief N.S. Sethi, Thakral Brothers md, J.S. Thakral, India Society President J.S. Dayal, Kastal Japan Ltd Chief M.P. Keshwani and Proctol and Gamble Far East Director Anil Gupta.
|
|
Govt firm on levying
ST on iron & steel SLOW down in industrial growth is a cause of worry. Many sectors have registered negative growth. Industrial economy is yet to get another jolt due to slide of agricultural growth. Finance Minister of India is in dialogue with captains of industry to find a way out to riggle industry out of this down ward spiral of growth. The Punjab Government is unaware of what is happening to industrial economy and is continuing to put hurdle after hurdle in the path of the beleaguered Punjab’s industry. The Punjab Government is firm in levying sales tax on first stage on Iron and steel materials. Taxation department is not even ready to talk to industry and trade. It has got yes on the issue from some sections of industry in Mandi Gobindgarh. Large section of industry there is perturbed over this issue. Moreover, steel user industry is located in other main industrial towns. Ludhiana indeed is the largest consumer of steel user industry will be the most affected by this levy. Levy of Sales Tax on First stage on raw materials is against the basic tenets of economics. States which have done this have exempted manufacturing units. Taxation department takes the plea that off set shall be available at every stage and no body is loser. This seems to be a misplaced argument which is not glued to the ground realities. Exporters are exempted from the sales tax. Some industrial units are exempted from sales tax. So it is difficult to avail set off of the tax paid on the previous stage. Most of the products of Punjab’s industry go out of the state. Bicycle and its parts attract only 2 per cent CST. If the manufacturer has already paid around 5 per cent sales tax on raw materials how can he match the set off. Steel using units get steel from outside the state as well. Some steel producing units in other states enjoy sales tax concession. So steel from them will be without sale tax. Some times such steel producing units increase the price by adding element of Sales Tax without mentioning it separately. Apart from other ill effects of first stage levy working capital of smaller units in particular shall shrink as this tax is to be paid before the manufacturing stage against the present pattern of charging it from the consumer at the last stage. More over, set off against CST is normally not allowed as in the case of paints and packing material which attract First Stage levy. Apart from these hard facts it is not possible to settle cases of set off’s. Official interference will be ubiquitous. There shall be many disputes regarding the quantity of material used for a particular finished product and the pricing. It should be well-known by now that day to day official interference in business matters leads to mal-practices and saps the energy of the entrepreneur. So instead of boosting government revenue the move shall boost the revenue of some tax payers and tax collectors. Already Punjab has levied sales tax at first stage on yarns. This is not working well. Such a levy heightens the anomalies products become price uncompetitive. Tax collecting powers should facilitate economic development not impede it. Revenue generation should at the same ensure wealth generation. Levy on first stage may not be compared to VAT system. VAT system shall work on the basis of harmonised system of nomenclature. It is better that proposal to levy sales tax on first stage on raw materials and sources of energy like Furnance Oil etc. may be withdrawn in the interest of the economy of the state. Industrial economy of Punjab is vastly different from that existing in other states. |
|
Birla opens
Monthly Income Plan CHANDIGARH,
Oct 14— Birla Sunlife Asset Management company today announced the launch of Birla Monthly Income Plan (MIP), an open-ended income scheme with no assurance returns. The MIP is designed to make payments of regular dividends at monthly intervals and investors have the option to either accept these payouts or re-invest them into the fund .The dividends are also tax free . Under the plan, the units equivalent in value terms to the gross dividend declared would be redeemed based on the balance units as on record date. The tax will have to be paid in the on the capital gains and not on the total amount
received. After the first year, investors will also get the benefit of concessional long term capital gains tax and indexation of cost. The initial offer of the Birla MIP is scheduled to close on November 10.
|
|
Partnership exchange
for IT industry NEW DELHI, Oct 14 — The National Association of Small and Medium IT Companies of India and Electronics and Computer Software Export Promotion Council in collaboration with UNIDO has decided to set up a National subcontracting partnership exchange for electronics, telecom and IT industry. The exchange will be globally networked with 46 other such exchanges across the world. This will facilitate the migration of IT related services from high cost environment of the developed countries to the low cost environment countries which are otherwise strong in IT such as India, a release said. |
|
Local area development tax hits industry THE introduction of levy of tax on entry of goods into the local area under the provisions of the Haryana Local Area Development Tax Act, 2000 poses a serious threat to the survival of industry in the State of Haryana. As a matter of fact units engaged in the manufacture and sale of exercise note books in Haryana now-a-days are passing through a very critical situation exclusively because of 4 per cent levy of entry tax on inputs which are purchased from the places situated outside the State. Several units have been closed in the recent past in the wake of the introduction of entry tax on raw-materials and many others are leading towards sickness because of the failure of the State Government to take into consideration their legitimate interests. It is a well-known fact that paper which is one of the input for the manufacture of exercise note books is not available in Haryana and that the units have to depend upon Punjab, Chandigarh and Delhi for its supply. What happens is that the manufacturers have to pay 16 per cent Central Excise duty and 4 per cent Central Sales Tax in addition to 4 per cent Local area development tax while buying paper from the other States. Besides they are also required to pay freight on raw-material when the same is brought to Haryana. In other words the units in Haryana are obliged to pay 24 per cent of the cost price on account of taxes and central Excise duty. Now if the finished goods are produced in Delhi, Punjab or Chandigarh where the inputs are easily available the manufacturers are neither required to pay 4 per cent Central Sales Tax nor do they incur any liability to deposit 4 per cent local area development tax under the provisions of the Haryana Local Area Development Tax Act, 2000. Thus net saving on account of non-liability towards Central Sales Tax and Local Area Development Tax for the units based in Punjab, Chandigarh and Delhi comes to 8 per cent which makes the exercise note books cheaper as compared to those manufactured in Haryana. Under these circumstances it becomes very difficult for the units in Haryana to stand in the fiercely competitive market. Most of the educational institutions situated in Haryana earlier used to buy exercise note books from within the State but now they have started buying these goods from the manufacturers based in Punjab, Chandigarh and Delhi obviously because of lower rates. Imposition of 4 per cent Central Sales Tax apart from 4 per cent local area development tax plays an important role as far as cost price of the finished goods is concerned. What is disturbing is that the State Government is paying no attention to this important aspect of the matter. If the State Government continues to stick to its policy of levying local area Development tax on raw-material it will lead to closure of the units due to unreasonable and irrational taxes in the State. In the event of discontinuation of the production activities several employees will have to face unemployment. Another important point which deserves to be taken note of is that exercise note books do not attract sales tax under Schedule ‘B’ appended to the Haryana General Sales Tax Act, 1973 and only objective behind was to promote literacy in the State. Unfortunately this legislative intention has not been taken care of while introducing 4 per cent local area development tax on inputs which are used in the manufacture of exercise note books. The question therefore arises is when the benefit of tax exemption is already available on exercise note books under the Sales Tax Act why can’t the same benefit be extended to the Haryana Local Area Development Tax Act, 2000.
|
|
Captive power to plunge SEBs into darkness CAPTIVE power is the power generated by an agency to meet its needs in complementary or supplementary mode to the electricity obtained from the national grid. The fuel used for generation may be fossil fuel in the form of diesel or wastes obtained from industrial processes or agricultural or municipal sources. The statement that this mode has acquired “relevance” may not find acceptance with many of the readers because they may be aware of many a failure in the public sector of the generation of power through this “alternate route”. After much fanfare, the PSEB had set up a plant to generate electricity from agricultural waste (paddy straw) at Jal Kheri, near Patiala, on the banks of the Bhakra Main Line. Now the board is trying to find a “buyer” for the plant. During the seventies the then Akali government had set up seven 1 MW diesel sets at different locations in the state, but these were not found “viable” and were sold as “junk” soon after the departure of the Akalis from the scene. Elsewhere in the country the scenario is different. The captive power generation in India has in the past five years registered a fast growth and crossed the 20,000 MW level. The factors which have contributed to this phenomenal growth are many and an effort is made to examine the issue next. During the Eighth Plan, the Power Ministry had set a target of installed capacity of 40,000 MW which was later lowered to 30,500 MW. But the shortfall noticed at the end of the Eighth Plan period was as large as 14,500 MW i.e. the installed capacity not crossing the 16,000 MW level. However, the power scenario in the country did not reflect this “massive shortfall” in the form of long and frequent “power cuts” and the credit goes to the growth of the captive power generation, which met the requirements of the “high-load customers” in the industrial sector. The phenomenon also got reflected in the form of improved power plant load factors which touched 90 per cent level in many cases. Among the factors which led to a rapid growth of the captive power are (i) the unreasonably high industrial tariffs compared to those charged from the domestic and farm sector consumers and (ii) the quality of power made available to the industrial sector. Industrial tariff rates In Punjab the above ratio was 0.374 in 1970-71 and became 0.82 in 1985-86. Thereafter the reversal took place and the ratio of the industrial tariff to the domestic tariff rose to 1.48 in 1990-91 and was 1.41 in 1992-93 and 1.4 to 1994-95. In the subsequent years the above disparity has been increasing and the ratio between industrial tariff and domestic tariff became as high as 1.715. The tariff structure has now become heavily loaded against the industrial consumers so much so that the average industrial tariff for high HT consumers varies between Rs 3.50 and Rs 4.00 per unit. The rates so obtained are comparable with the production rates for the captive power plants, which are consequently no longer considered as an alternate power source but as a regular source of energy supply for certain types of industrial units. Captive power & SEBs The SEBs are at present dependent on cross-subsidy to maintain their losses at the present levels. In the process the industry is charged higher tariff than all other sectors. In Punjab during 1996-97 the industrial sector contributed nearly 66 per cent of the earnings of the board while it consumed hardly 40 per cent of the power sold by the board. In the case of Rajasthan, during 1997-98 the revenue earned by the SEB from the industry was to the tune of Rs 1924 crore compared to that of the Rs 216 crore, though the amount of power consumed by the two sectors was nearly equal. The farm sector in Rajasthan while consuming 35 per cent the power sold in the state hardly contributed 7 per cent to the SEB’s revenue. (The readers are left to figure out as to how much the farm sector now contribute to the PSEB’s revenue while consuming over 40 per cent of the total power). The studies have shown that greatly subsidised tariff (leading to “free power” to some sectors) means unaccounted supply and run-away tariff. In any case, the grant of “open-ended subsidies” make no sense in the highly capital intensive sector of power generation. Limitations removed In case of some industrial processes such as the food processing, pharmaceutical units, alloy plants etc the availability of assured supply of electricity is must. Now it has become difficult to get the projects relating to the above processes financed unless uninterrupted power can be assured. For that the SEBs will not install “dedicated lines” for new units as they don’t have the resources. The obvious choice is to depend upon “captive power” which may be based upon diesel generation. While the increase in captive capacity is in response to the grid failure, it is questionable whether the trend set is for “national good”. The SEBs may have cause for concern as their earnings may drop further due to the loss of HT consumers. Captive power can keep our industry going. But this would be at the cost of the SEBs which would see their revenues getting steadily eroded due to the short-sighted policy of the politicians to provide sops for garnering votes. This scenario will result in a spiral wherein the SEBs will be forced to squeeze the domestic and small industrial consumers more and more to make up for the revenue shortfalls. The net result is that the ordinary man ends up paying more for both electricity and the goods produced by industry while the income tax (and surcharge thereon) goes to pay for the sops handed out by the politicians whereas these ideally should be getting used for creating more power infrastructure. (Dr G.S. Dhillon is a former Chief Engineer Research-cum-Director, Irrigation & Power, Amritsar) |
rc
Ajanta Pharma Colgate-Palmolive Philips India Aptech |
ty
by Praful R. Desai Actual days Q: Has petitioner brought on record facts showing actual number of days for which the workman was entitled to benefit? A: The issue was discussed by the Allahabad H.C. in the case of State of U.P. v Labour Court, Agra (2000-II-LLJ-810) as under: The H.C. found that the impugned order was passed considering relevant facts. A contention was raised by the employers that the workman did not complete 240 days period of work, as required in law for relief. A perusal of the writ petition does not indicate that even at this stage the petitioner has successfully brought facts showing actual number of days for which the workman concerned is entitled to benefit viz the number of days for which the workman was on leave and had paid holidays. These facts have not been disclosed in the writ petition for the purpose of contradicting the finding of the Labour Court. Mere actual number of days of work will not justify this Court to conclude otherwise. No material has been shown on which a finding could have been reached by the Labour Court that the workman concerned did not complete the requisite period. Admittedly, the workman was in service from January 6, ’90 to May 11, 1992. Non-compliance of the requirement of S. 6-N of the U.P. Industrial Disputes Act is also admitted. Therefore, the H.C. held that there is no ground for interference with the impugned order. In view of the aforesaid findings, the H.C. dismissed the writ petition. |
co
by Pushpa Girimaji Patients have right to all medical records THE unfortunate and sudden demise of former Union Minister Mr
P.R. Kumaramangalam and the ensuing controversy over his health care has finally made the Union Health Ministry realise the need for a law to give patients and their families access to all medical records. In promising to issue and ordinance to this effect, the Health Ministry has at last recognised the consumer’s or the patient’s right to information, choice and grievance redress. Hopefully, the ordinance will not have any loopholes that will allow hospitals — either government or private — to get away with violations of the law. I say this because the health ministry has said it would make it mandatory for medical institutions to make available medical records to patients or their families, “on demand”. Given the lack of awareness among patients about their rights, most of them may not even demand it. It would therefore be much better to ensure through the ordinance that all records including reports of investigations are provided to patients or relatives without their asking for it. The relevance of medical records cannot be over emphasised. first and foremost, every patient has a right to information and medical records give him or her that information. The records also help the patient and his or her family exercise their right to choice. They would need the records to consult another doctor or specialist or even to change the doctor or hospital if they are dissatisfied or unhappy with the treatment. In addition, most investigations are expensive, besides carrying with them, certain amount of risk and may be even side effects. Why should a patient go through the tests every time he consults a different doctor? Also, at a later stage, if there are some complications and the patient is in another city or country and is forced to consult another doctor there, absence of all records pertaining to diagnosis and treatment would be a major handicap. These days there is so much of specialisation in the health care delivery system and even if you are consulting another specialist for a different problem, he or she might want to know about your previous medical history and may want to see the records. In short all records should be with the patient and form part of his or her file on medical history. Lastly, they are also required in case the consumer decides to exercise the right to redress against negligent service. But unfortunately, in recent years an increasing number of patients are complaining of doctors or hospitals holding back all relevant medical records. And the complaints are not just against private hospitals. In the case Prasanth S.Dhanaka vs Nizam’s Institute of Medical Sciences, the National Consumer Disputes Redressal Commission expressed displeasure over the fact that the Institute did not place the records even before the Commission despite being told to do so, thereby forcing it to issue an order for the production of records. Under the CP Act, a consumer can seek the help of the consumer court for the production of relevant records by the opposite party. The courts also have the power to order search and seizure if necessary. But that is possible only when a case is filed before a consumer court. The Consumer Protection Act gives the consumer the right to information, choice and grievance
redressal. On the basis of this, consumers have argued, but without success, that they have a right to all medical records and failure on the part of hospitals to give the records constitutes deficiency in service provided. While the lower consumer courts have agreed, the apex consumer court has not. In the case Poona Medical Foundation, Ruby Hall Clinic Vs Marutirao L.
Titkare, the Maharashtra State Commission held the hospital guilty of deficient service for not furnishing all the records to the patient and even awarded Rs 10,000 as compensation to the consumer. The National Commission, however, set aside this order and said there was no legal duty cast on the hospital to provide such documents to a patient. The patient’s case was that because of the hospital’s refusal to give all the records, he could not be treated effectively in some other hospitals where he had subsequently gone for treatment. Said the apex consumer court: “The appellant hospital had duly given to the complainant at the time of his discharge, the discharge card and slip and also a case sheet wherein the particulars of the diagnosis and the treatment administered to him had been mentioned. No material has been placed before us to show that either by law or by convention or by practice there was any obligation on the part of the hospital to furnish to the patient full particulars of the surgical operation performed on him”.
|
bb
PNB Net Across Ion Exchange Go4i.com SSI 3Com India |
 |
| Punjab | Haryana | Jammu & Kashmir | Himachal Pradesh | Regional Briefs | Nation | Editorial | | Business | Sport | World | Mailbag | In Spotlight | Chandigarh Tribune | Ludhiana Tribune 50 years of Independence | Tercentenary Celebrations | | 120 Years of Trust | Calendar | Weather | Archive | Subscribe | Suggestion | E-mail | |
