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Sunday,
May 6, 2001, Chandigarh, India  
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SEBI defers decision on carryforward
'Biotechnology can boost fruit exports'
Meeting held on anti-dumping Punjab Agro signs MoU with US firm Jaquar orientation centre in city |
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Punjab records 69 pc fall in cotton yield Siemens to buy back shares UTI Bank net up 68.66 pc Q: My daughter had been to England on office assignment for about 5 months. While leaving she carried with her foreign exchange of £ 3500 with entry in her passport. During her stay abroad she received maintenance allowance on daily basis remitted by her company from India in installments. Partner as employee Bill to give more powers to consumer courts
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SEBI defers decision on carryforward
Mumbai, May 5 The Finance Ministry representative Rakesh Mohan, who is an advisor to the Finance Minister Yashwant Sinha, and Aditya Birla group Chairman Kumarmangalam Birla, did not attend the meeting leading to deferment of the crucial decisions, SEBI Chairman D.R. Mehta said. “Such important decisions cannot be taken without a full quorum and will now be discussed at the next board meeting scheduled on May 14 here”, Mehta told reporters. The SEBI-constituted group, headed by full member J.R. Varma, had last week recommended that deferral products approved by the regulator would cease to be available from July 2, leading to a sharp drop in the sensex as brokers expressed disappointment over the suggestion. The rolling settlement is to be introduced on stock exchanges on July 2. The group recommended that automated lending & borrowing mechanism (ALBM), borrowing & lending of securities scheme (BLESS), modified carryforward system and continuous net settlement (CNS) would cease to function from that date. Yesterday, Mehta had held a meeting with Sinha to discuss the recommendations of Verma Committee in Delhi.
Code of conduct
In bid to prevent insider trading and provide investors with fair and equitable access to information, SEBI has drafted a “Proposed procedures and code of conduct”. SEBI Executive Director L.K. Singhvi said the SEBI group on insider trading in its deliberations felt that there was a need for prescribing suitable procedures and code of conduct for corporates and other entities in the capital markets to prevent insider trading. The drafts of suggested procedures and code of conduct have been prepared and circulated to a cross section of corporates, market intermediaries like merchant bankers, brokers and mutual funds, industry associations, financial institutions and professional firms for their comments, he added. Stock markets rallied earlier this week on hopes the practice would be gradually phased out.
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'Biotechnology can boost fruit exports' Chandigarh, May 5 Talking to the Tribune about the opportunities in biotechnology with special reference to India, Prof. Coloe said although India was second largest producer of fruits and vegetables in the world, but it accounts for only 1 per cent of exports because of deficiency in post-harvest technology and the absence of effective bacterial and fungal spoilage control. "Only the application of new biotechnology technique will rapidly resolve some of these deficiencies and could make India become one of the world largest fruit and vegetable exporters" he added. Mr Coloe who is working as Biotechnology Professor and Head of RMIT Biotechnology and Environmental Biology in Australia predicted that the biotechnology would soon be the thrust area in view of its vast application in all sphere and the current growth. He disclosed that biotech business is increasing exponentially with major thrust into human health, agriculture, veterinary medicine and environmental biotechnology. There was an urgent need for new biotech-based vaccines for cancer, diarrhoeal disease influenza virus, TB, Malaria and pneumonia and a need for improved and cheap disease diagnostic. He said situation was similar in many countries that proves the opportunities had arrived but the new thrust would be biotechnology and he has coined a new slogan from IT to BT that is information technology to biotechnology. Prof Coloe said the biotechnology had direct impact on several activities such as health care, agriculture, food processing and horticulture.
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Meeting held on anti-dumping Chandigarh, May 5 Mr Bansal said under the existing WTO arrangements and in terms of the provisions under the Customs Tariff Act. Anti-dumping and allied measure constitute the legal framework within which the domestic industry can seek necessary relief and protection against dumping of goods and articles. The Ministry of Commerce and Industry has organised countrywide seminar on anti-dumping so that the trade and industry may be suitably informed on these issues. Mr M.K Anand, Director General of anti-dumping in New
Delhi, while elaborating on anti-dumping matters, said it was necessary to bear in mind that the anti-dumping action can never be an action based on presumption and vague complaints and only on rare occasion suo-motu proceeding can be initiated. Others who attended the meeting were Mr N. P. S. Monga, Joint DG (Ludhiana), Mr R. P. Goel, Joint DG (Ludhiana), Mr M. S. Dhillon, Joint DG(Panipat) and Mr Yashpal Bhagat, Regional Director — Planning Commission.
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Punjab Agro signs MoU with US firm Chandigarh, May 5 According to Mr Chahal the company will help Indian farmers adopt new high-yield crops to compete international market. In the beginning, Globe will float a Rs 20 crore project for promotion of improved seeds and other necessities for farmers in Punjab. The company will have a stake of 90 per cent and Punjab Agro 10 per cent. Globe will introduce kenaf, a jute like plant with Rs 30,000 per acre yield. Strawberries from Irvine farm of California which will fetch Rs 1,00,000 per acre, vegetables used for salad, such as small tomatos, small carrots, small onions and mushrooms will also be introduced to Indian farmers for export purposes. Mr Chahal said Punjab is most suitable for cultivation of kenaf and also plans to set-up a kenaf processing plant in Punjab where this plant’s product will be mixed with plastic to produce wood-like material at 200°C. It will be used for housing and automobiles industry. The cost of a log of kenaf wood is 50 cent in the USA. It will cost only 2 cent in India. The product will replace wood and help save lakhs of trees the world over. The product will be exported to the USA, Mr Chahal added.
Jaquar orientation centre in city Chandigarh, May 5 Mr Salil Chopra, CE of the Jaquar said that company with plant at Delhi has just crossed the turnover of Rs 100 crore and achieved the sale target of Rs 300 crore. It has market share of 60 per cent in premium segment and exports its products to the UK, South Africa, Sri Lanka, Dubai and Switzerland. Jaquar with objective to compete in the world market and bring the world class quality products enter into collaboration with Hansgrohe (Germany), Aquis (Switzerland) and Swaroski (Austria). Jaquar also manufactures thermostat controlled taps that control the temperature as per the need. For the first time in India, one can see the live demonstration of Pharo Hansgrohe showers at the orientation centre.
Punjab records 69 pc fall in cotton yield New Delhi, May 5 According to a study carried out by (Assocham), cotton production in Punjab fell from 1925 (000 bales of 170kg) in 1996-97 to 595 in 1998-99. Production in Andhra Pradesh fell from 1878.4 (000 bales of 170 kg) to 1486.6, Haryana 1507 to 873, Karnataka 932 to 855, Maharashtra 3143.3 to 2618.9 and Rajasthan 1363.3 to 872. Cotton production recorded a smart rise from 2657.7 to 39350 bales in Gujarat and from 329.9 to 429.5 in Tamil Nadu. Madhya Pradesh saw a marginal increase from 424.2 to 426.3.
Siemens to buy back shares Mumbai, May 5 The buyback will be from the open market through the stock exchange, the company said in a release here today. The Board, which met today, proposed the buyback in view of its favourable liquidity position and to enhance shareholder value. The proposal will be taken up for consideration at an extraordinary general meeting of shareholders to be held next month, it said. Siemens Managing Director J Schubert said the prime objective was to utilise the financial resources in the best interest of the shareholders. The scrip on the Bombay Stock Exchange rose sharply from Rs 183.85 (on May 2 when it informed the bourses of a Board meeting to consider a buyback proposal) to Rs 207.25 a day later and yesterday closed at Rs 206. Similarily, at the National Stock Exchange the scrip gained and went up from Rs 185.05 (on May 2) to Rs 206.60 and ended yesterday a notch higher at Rs 207.15.
PTI
UTI Bank net up 68.66 pc Mumbai, May 5 The board has recommended a dividend of 15 per cent in the reporting year as against 12 per cent in the 1999-2000, UTI Bank said.
PTI
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Q: My daughter had been to England on office assignment for about 5 months. While leaving she carried with her foreign exchange of £ 3500 with entry in her passport. During her stay abroad she received maintenance allowance on daily basis remitted by her company from India in installments. While returning from England she arranged with her company official for electronic transfer (in his individual capacity) of £ 3600 saved by her to her savings account in Mumbai bank. The bank credited the rupee proceeds to her savings account of the remittance received from UK. The amount brought back has been adjusted by the company internally against her tour expenses. As such no transfer has been made from her savings account. I feel that since the exchange she has taken, has been brought back through banking channel, only pound 100 excess received is taxable. —- B.S. Shenoy, shenoybs@hotmail.com A: Allowances granted to cover expenses incurred wholly, necessarily and exclusively in performance of office duties are not taxable. It would be illogical to impose any tax on such allowances and logical to tax any savings effected out of this allowance. Such savings obtain the colour and character of salary income. Nevertheless, in a far-reaching judgement, the Delhi High Court in the case of R. Dalmis V CIT (1982) 133itr 149 has held that savings made by the wife out of household expense money given by her husband would be separate property of the wife. Any income arising therefrom cannot be aggregated with the income of the husband. If I am allowed to extrapolate this principle to your case, the amount saved by you out of the allowances is not taxable, as long as such savings are small and reasonable. However, what is reasonable or otherwise, is a matter of opinion and the ITO has the full powers to use his discretion. Q: I am a bank employee due to retire in 2004. With the sole intention of doing some business my wife had booked a shop in residential cum commercial complex, costing Rs 5 lakh. She approached several financial institutions to raise a housing loan of Rs 5 lakhs for purchasing the said shop. Unfortunately she did not succeed since no financial institution grants loan for a shop. I had acquired a residential flat with the help of housing loan from my employer and the outstanding balance is negligible. I intend to repay the entire outstanding housing loan balance and mortagage the flat to raise a loan of Rs 5 lakhs that my wife requires. Is there any scope of income tax rebate for the monthly instalments and interest payable by me? —-Naresh manas@nagpur.dot.net.in A: It is you who would be taking the loan and the shop would be in the name of your wife. You will not be eligible for rebate u/s 88 on repayment of loan and the deduction u/s 24 on interest paid. 1. You may buy the shop in your own name and pay salary to your wife for wholly managing the business. The risk is that the ITO will claim that you are conducting the business in the name of the wife and include the business income in your hands. Nevertheless, he will have to allow the entire interest paid to the finance institute as a deduction from the business income. 2. You may take the loan in your name and give a separate loan to your wife on the same terms and conditions to enable her buy the shop. The interest your receive from the wife will be identical with the one you pay the finance company. You will not get any benefit but she will be able to claim the interest paid to you against her business income. The risk is that the ITO will tax you on the interest received from the wife and may not allow deduction of the interest paid by you. 3. Take a loan and gift the amount to your wife. The business income of your wife will be clubbed in your hands and you can set off the interest paid by you to the institute. This strategy also carries the same risk. 4.The best course of action is for your wife to take a loan in her name against a third party guarantee offered by you by mortgaging your flat. You should be able to get such a loan from any bank.  |
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Partner as employee Q: Are partners receiving salary to be employees of the firm? Ans: Calcutta H.C. was dealing with this point in S.G. Tin Printers (P) Ltd. v R.P.F. Commissioner (2001-I-LLJ-628) as under: The only question for consideration in this appeal was, as to whether such partners who were getting salaries would be employees within the meaning of S.2(9) of the E.P.F. Act.S. 13(a) of the Partnership Act inter-alia provides that subject to contract between the partners, a partner is not entitled to receive remuneration for taking part in the conduct of the business. Salary is the result of the inter-se agreement between the partners. The H.C. opined that for the purpose of the provisions of the E.P.F. Act, or otherwise, a partner cannot be said to be an employee of the partnership firm having regard to the Indian Partnership Act, in as much as it is a well settled principle of service jurisprudence that a person cannot both be employer and employee at the same time. In Regional Director Employees’ State Insurance
Corporation v Ramanuja Match Industries (1985 (I) SCC 218) the S.C. held that the position of a partner qua the firm is thus not of a master and a servant or employer and employee which concept involves an element of sub-ordination but that of equality. The partnership business belongs to the partners, each one of them is an owner thereof. In common parlance the status of a partner qua the firm is that different from employees working under the firm, it may be that a partner is being paid some remuneration for any special attention which he devotes but that would not involve any change of status and bring him within the definition of employee. The H.C. held that the order of the trial court cannot be sustained. It is set aside accordingly. Keeping in view the admitted fact that a private limited company has come into being w.e.f. 23.8.95, the liability of the Co. vis-a-vis the question as to whether the Directors of the Co. have become employees thereof or not, must be decided by the Regional P.F. Commissioner
himself. Consequently, the H.C. directed that the proceedings be re-opened and a decision afresh be taken upon giving an opportunity of hearing to the parties in the light of this judgement. In that way, appeal was disposed
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Bill to give more powers to consumer courts Finally, after a long wait of seven years, a Bill to amend the Consumer Protection Act (CPA) has been introduced in the Rajya Sabha. Of course it’s anybody’s guess as to how long it would take for the amendment to sail through both Houses of Parliament. Hopefully, the MPs would keep the interests of consumers in mind and ensure quick passage of the Bill. Thanks to the keen interest shown by the Union Minister for Consumer Affairs, Mr Shanta Kumar, the Bill incorporates most of the suggestions made by the consumer groups, the Central Consumer Protection Council and the Naren De Committee constituted for the purpose. Once notified, they will help in overcoming many of the deficiencies in the law encountered during the course of its implementation and ensure better protection of consumers, which is the primary intent of the law. There is one exception though and that is the amendment incorporated at the behest of the Union Cabinet. Section 3 of the Consumer Protection Act says that the provisions of the act shall be in addition to and not in derogation of the provisions of any other law. Now the Amendment Bill proposes to replace this with a new Section, which says that the provisions of this Act shall apply to all claims except claims in respect of which corresponding remedies of judicial nature are available under any special law. On the face of it, this may seem like a good idea as it reduces the load on consumer courts, but in reality, it is not in the interest of consumers because (a) it takes away one of the fundamental rights of the consumer — the right to choose and (b) it unnecessarily narrows down the scope of the consumer courts. Take the Insurance Ombudsman, for example. Today, consumers have in the Ombudsman an alternate dispute redressal mechanism that is simple, quick and cost-effective. Notified under Section 114 of the Insurance Act, the Redressal of Public Grievances Rules, 1998, gives the Ombudsman the power to deal with any individual grievance against an insurer. As of now, consumers can either go to the Ombudsman or the consumer court for redress of their grievance. The redress available before the Ombudsman today is much quicker than the consumer courts and the procedure, far simpler.... However, they are located only in 12 cities while the consumer courts are in every district in the country. While before the consumer courts, there is limitation of two years of filing the complaint, before the Ombudsman, it is one year. So a consumer can weight these factors while choosing the forum. However, once Section 3 is introduced, a consumer may not have that choice and all insurance cases may well go outside the preview of consumer courts. Similarly, as and when service providers set up an alternate system of grievance redress, those services may get excluded from the ambit of the CPA, if the remedies provided by them are similar to the consumer courts. Consumers should therefore lobby with their MPs for the removal of Section 3 from the bill. Otherwise, the Amendment Bill contemplates major changes in the law to speed up the process of adjudication, give the courts more power to deal with a wider range of complaints and also ensure better compliance of the orders of the courts. When the opposite party, for example, fails to pay the amount ordered by the court to the complainant, it can be recovered in the same manner as arrears of land revenue. Earlier, the consumer courts could only sentence those who failed to comply with their order to undergo imprisonment. The Bill also enables consumer courts to issue interim orders and also attach the property of those who fail to comply with the interim order and if necessary even sell it to pay for any damages awarded to the complainant. And major lacuna in the CPA is the lack of provisions to deal with spurious, unsafe and hazardous goods. The Bill seeks to correct this. It also restricts considerably, the role of advocates in the process of adjudication. It also proposes to considerably enhance the pecuniary jurisdiction of the consumer courts. While the District Forum will entertain complaints where the value of the goods or the services and the compensation claimed is up to Rs 20 lakh, the State Commission will have the jurisdiction to hear complaints where the value is over Rs 20 lakh, but less than Rs 1 crore. The National Commission can entertain complaints of over Rs 1 crore. Since services hired for commercial purposes is proposed to be taken out of the jurisdiction of these courts, the change in the pecuniary jurisdiction will mean that the National Commission and the State Commissions will handle mostly appeals. Almost all the original petitions will go to the District Forum. While the idea is to take consumer justice to the doorstep of the consumer, one has to carefully consider the possible impact of the increased load on the Forums. |
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Writers, producers sign pact Two company directors held Ad market seen alive But the downgrades do not spell doom and gloom, industry experts say. As advertising spending was stronger than expected last year, growth this year will be harder to come by, but a quick return to healthy growth is expected as soon as next year. “Historically, advertising has always shown a positive rate of growth in the USA, and we are in a phase of readjustment,’’ Sebastien Danet, Chairman of media space buyer Zenith Media France, said in a recent interview.
Reuters
Exports zones pays rich dividends |
bb
Canara bank MoU on tourism KNA Intl |
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