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Monday,
October 7, 2002, Chandigarh, India  
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Mohali
emerges out of Chandigarh's shadow
Personal
pension plan from HDFC |
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Consumer
protection in e-commerce
The
slidedown continues
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Mohali emerges out of Chandigarh's shadow Mohali has reached an age where it is no more considered as the last option for deciding to a take a residential property. The improvement in infrastructure, development of lush green parks and satisfactory law and order condition over the past few years have helped it emerge as an independent town. Further, lack of space in Chandigarh, despite sky-rocketing prices, have compelled the middle class to look for houses in this area. The real estate experts say that Mohali is emerging as the second best option, after Chandigarh, for the employees, landlords of Punjab and even NRIs, to invest in property. It has left Panchkula far behind due to various reasons, including due to deteriorating law and order condition and higher stamp duty. They say the Mohali is also preferred as compared to Panchkula because of more accessible points. The city is almost an extended part of the Chandigarh.
Shift in real estate market The decline in industry over the past two-three years, has failed to have any drastic impact on the real estate market. The insiders in the market say that it is not the industrialists but the employees, traders, landlords and NRIs, who are investing here. Moreover, a section of Chandigarh residents, is also shifting towards this area, by selling their highly-priced properties in the UT. Mr Amarjit Singh Sethi, a leading real estate consultant here says, ‘‘We are witnessing a new class of buyers, who are coming here by selling their houses in
Chandigarh. It is due to the fact that one could sell a house of one Kanal in any Northern sector of Chandigarh for about Rs 75 lakh to Rs 80 lakh and buy the same size of house here for Rs 35-40 lakh.’’ He admits that the market in Mohali has strengthened over the past few months. Though the increase in prizes is marginal, by 5-10 per cent over the past six months, but it is still attracting true buyers and not the speculators. The easy availability of finance from the banks and other financial institutions has also encouraged the customers to invest in the housing sector. Mr Bhushan Bhardwaj, a senior manager in a sanitary products' manufacturing company, admits that over the past six months the real estate market has witnessed rise in prizes. He says, ‘‘A plot of 8 marla, which was available for Rs 11-12 lakh in sector 68 or 69 about six months ago, is now fetching a price of Rs 13 lakh to Rs 13.5
lakh. Similarly, the price of a 10 marla plot has increased from Rs 12-13 lakh to Rs 15 lakh to Rs 16 lakh. However, there are few takers for industrial plots in the industrial area, due to slump in the industry.’’
Role of banking sector Like other parts of the country, the cut in interest rates and easy finance has helped the growth of housing sector here as well. Mr Vishal Handa, Manager at ICICI Housing Finance, says,‘‘ Our bank also provides service of a consultancy on property — to help buyers and sellers to reach an agreement, besides providing loan to purchase, build or renovate a house. We have a data base of over 1,000 properties in this town, and have helped hundreds of customers to buy houses, by charging a commission of 1 to 2 per cent of the value of property from both the parties.’’ He admits that the real rate of property are significantly higher than the rates quoted for the registration of deed. However, the banks would provide loans for documented price only. Unlike other property dealers, he is of the view that the market has not witnessed any significant rise in price in some pockets. One could still find a good house of 10 marlas in Phase 3B2 for Rs 18-20 lakh. The market has also remained stagnant, he feels, due to slump in the market, and the availability of plots in new sectors and the surrounding colonies in abundance, which were being developed by PUDA licensed promoters.
Registration of property The enquiries made with the office of Sub-Registrar here reveals that on an average about 100 sale deeds are signed every month. It includes the sale of commercial property as well. A senior official claims that as per the latest changes in the Punjab Stamp Act, the government has imposed 6 per cent stamp duty on the registration of property in addition to 1 per cent registration fee with a maximum limit of Rs 10,000. He admits that as per the Supreme Court guidelines, the Tehisldars are no more the competent authority to fix any minimum price for the registration of property. However, as per verbal instructions, he says, they are registering property for at least Rs 4,000 per square yard. The average market rate is about Rs 200 plus or minus in the town depending upon the location of property. He admits that a number of cases have been referred to the Deputy Commissioner, where the price is quoted lower than that of actual value. Regarding the genuineness of sale deeds, he says, some of the banks and good property dealers have their own specialised legal advisors, who would verify the authentication of property documents.
Commercial property The Punjab Urban Development Authority (PUDA), which is the nodal agency to develop this town, has kept adequate space for small and large markets here on the pattern of Chandigarh. Recently, the PUDA had auctioned the showrooms measuring 16 x 66 feet for Rs 60-65 lakh and the large show rooms in phase II measuring 34 x 75 feet were sold for above one crore. Mr Sethi points out that one can purchase a small showroom for Rs 35 lakh to Rs 40 lakh. The difference between the market price and the auctioned price is due to the fact, that PUDA would charge money in six instalments. The rate of commercial property has also increased with the increase in population and emergence of service sector companies. Number of manufacturing and trading companies have either purchased showrooms or taken them on rent, thus affecting the sale price. Mr Sethi feels that despite marginal increase in property price, it is the right time to purchase any residential or commercial property. Though the industry has suffered to a great extent, but the city is bound to see a tremendous growth in the coming years, second only to Chandigarh. The Punjab government has already made its intentions clear to develop it as an Excellence Centre for IT and enabled services. The property rate would increase, once some MNCs decide to invest here. The impact of Bharti Telecom, HFCL, Spice, Quark, PCA stadium is already visible.
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Personal pension plan from HDFC Retirement can be converted into one of the best periods of ones life as one is almost over with most obligations. Duties and responsibilities towards the loved continue, but during a retired life one has the opportunity to life quality life as per one’s liking. But all this is only possible if there is adequate financial buffer that permits hosts of activities that one desires. Retirement certainly does not mean ‘old age’, though it is a step in that direction. Retirement can be converted into a golden period with some careful planning. Personal pension plan One of the several options available for a safe post retirement plan is the Personal Pension Plan from HDFC Standard Life Insurance Company. The Personal Pension Plan is basically a policy that HDFC offers that lets you save during your financially productive years and in return it promises an income for life from retirement, with an option that allows you to chose between taking a lump sum or to go for an annuity.
How do you pay? Under the Personal Pension Plan, you as a policy holder agree to pay either a single premium or level premiums with instalments due every quarter, half-year or year throughout the deferment period of the policy, after which you will start receiving your pension.
Risk if you breach the contract Like all insurance policies, the Personal Pension Plan from HDFC considers it a breach of contract if you cease to pay premiums at the agreed upon intervals. Under such circumstances, the HDFC may pay a surrender value which is determined at the discretion of the HDFC Standard Life Insurance. Again if the HDFC discovers that the facts or information provided at the time of initiating the contract was incorrect, the company holds the rights to treat your policy as void. Also, in the event of an unfortunate death, if the policy holder has ceased to make the payments, the company will not entertain any claims.
In case of an early death On earlier death after the first year, for regular premium policies all premiums paid to date will be returned with interest at 8 per cent per annum, subject to a maximum of the sum assured plus bonuses declared to date. For single premiums, it is sum assured plus bonuses declared to date. Normally, a reversionary bonus will be declared once a year. Once added, it cannot be reduced. Reversionary bonus will take the form of a simple addition to your policy benefits. On death, an interim bonus, reflecting the period since the last addition of reversionary bonus, might also be payable.
Cost of the plan The cost of the plan depends on your age, the amount of benefit you have chosen, the premium paying frequency and the term of the policy. A policy that insures you for Rs 1,00,000, the annual premiums would be as follows: Age 30, policy period 30 years, annual premium Rs 4,309, age 35 policy period 15 years, annual premium Rs 6,098, 30 years Rs 4,327, age 40, policy period 10 years, annual premium Rs 9,577, 15 years Rs 6,117 and 30 years 4,357. For Single premium policies, the premium payable with respect to the basic benefit is equal to the basic sum assured as required by the policyholder.
Who is eligible? The plan is open to all between ages 18 and 60. The minimum entry age for regular premium is 18 and for single premium 35. The policy offers a minimum term of 5 and 10 years depending upon age and a maximum term of 40 years for regular premium and 15 years for a single premium. The maximum age of entry is 60 and the minimum age of retirement 50, while the maximum age of retirement is 70.
The plan does not offer any loans HDFC Personal Pension Plan does not offer any facility for loans. However, you may surrender the policy at any time subject to the prevailing legislation and regulations at that time. However, if premiums have been paid continuously for at least 3 years, the surrender value will be subject to a guaranteed minimum. Before retirement, the guaranteed surrender value, including the value of any attaching bonuses, for Regular premium policies is: Zero in respect of premiums paid in the first year; and 50 per cent of premiums paid subsequent to the first year in respect of the basic benefit, excluding all additional premiums. However, it Tax entitles you for tax benefits described in Section 80 CCC of the Income Tax Act are applicable (up to Rs 10,000). |
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by Pushpa Girimaji Consumer protection in e-commerce E-commerce has promoted a global marketplace, facilitating cross-border business to consumer (B2C) transactions. Be it books, music, jewellery, clothing, electronic goods, rail or air tickets, if you have a credit card and access to an internet connection, you can buy from cybershops anywhere around the world, without actually having to visit those countries. However, what keeps most consumers wary of cross-border electronic transactions is the fear of having a raw deal and the fact that they may not have access to a dispute resolution mechanism in such a case. Suppose you buy goods or services on the internet from a business located within India and a dispute arises over the product or the service, you can seek justice through consumer courts constituted under the Consumer Protection Act. But if you are purchasing from a business located outside India and you have a grievance, consumer courts cannot help you. And in the absence of international agreements on competent jurisdictions and complete harmonisation of applicable rules and laws, recourse to courts in such disputes can be complicated, expensive and time-consuming. Businesses around the world are only too aware of this. They know that unless consumers are confident that their interests are sufficiently protected in case of a dispute, trans-border e-commerce will not thrive. So they are increasingly promoting extra-judicial dispute resolution mechanisms as an alternative to cumbersome, costly and lengthy court procedures. In fact, if you search on the net, you will be surprised at the number of online alternative dispute resolution (ADR) services that are available. But how useful and effective are they? About two years ago, Consumers International (CI), a federation of consumer organisations around the world, commissioned a study of existing online dispute resolution options for consumers in cross-border transactions. You may find this difficult to believe, but it found as many as 30 online dispute redressal (ODR) service providers offering 36 distinct services . The study assessed them on the basis of various parameters such as their independence or impartiality, transparency, availability, affordability, effectiveness, visibility, speed, competence of officers, accessibility, security and enforceability. Its conclusion was that none of the services reviewed fully satisfied the criteria for effective online dispute resolution between business and consumers in the global marketplace. CI found that a large number of these services charged fees that exceeded the disputed amount in many consumer transactions. The only services that were entirely free to consumers were those operated by consumer groups such as Internet Ombudsman and Web Trader, those specifically designed for consumer disputes such as BBB Online’s Complaint service, Online Ombuds Office, The Virtual Magistrate, I-Courthouse, iLevel, and those supported by business subscriptions such as Novaforum, SquareTrade’s complaints assistance service, OnlineDisputes and those limited to and paid for by certain kinds of businesses such as AllSettle.com. Some of the service providers offered complaints assistance, while others offered mediation. Some others facilitated negotiations, yet others, arbitration. According to the CI, there was a great variety of ODR services, but very few met the requirements of consumers in business to consumer disputes. Common weaknesses of most of these systems listed by the CI included limited availability, high cost, failure to include adequate consumer representation on the governing board, lack of transparency and limited incentives for compliance with their verdict. The CI observed that most of the online mediation and arbitration services available to consumers were designed primarily for large value disputes and for typical retail transactions the services were disproportionately expensive. Business and consumer groups have now been working in this direction so that consumers have access to a more effective and satisfactory online cross-border dispute resolution. Several government and non-government organisations at the global level have also been addressing issues of consumer protection in e-commerce. Meanwhile, consumers will do well to exercise caution with regard to cross-border transactions online. It is always better to deal with reputed companies but check their ‘returns and refunds’ policies. Find out if there are any restrictions on cancellations or returns. And if you are buying from another country, make sure that you don’t have to pay postage for returning the goods or else it could become prohibitively expensive to do so. Also, find out if they have an effective internal complaints handling system. |
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by J.C. Anand The slidedown continues The stock market continues to slide down. During the last fortnight, Sensex was down by 93.84 points (3.10 per cent). The worst sufferers were HPCL, BPCL, Reliance, Hindustan Lever and the multinational pharma shares. The textile’s scrips were able to hold their own. ABB and Nestle also did well. While ABB moved within a narrow range, Nestle improved its market price as there was a bulk buying in Nestle. Perhaps it was done by its parents company which has its head office in Switzerland. The Sensex has touched a new low in recent months. According to one estimate, the aggregate market capitalisation on the BSE declined by 10.76 per cent from April 1, to September 30. Even the Information Technology shares were hit. SMG’s scrips and shares of Refineries and Telecommunication companies also lost considerably during these six months. Apart from S&P’s lower rating for India’s local currency, there were a number of other agencies which cut down the expected growth rate of India’s GDP. The International Monetary Fund (IMF), which had projected 5.5 per cent growth for India earlier, has now scaled it down to 5 per cent for the current financial year. The National Council of Applied Economy Research (NCAER) has also revised its estimated GDP growth this year at 4.8 per cent against the earlier estimate of 5.5 per cent. Some of the foreign funds are cutting down their stakes in debt fund schemes. Against this dismal background caused by deficient monsoon rains and the slowing down of the Indian economy, there is surprisingly a good news regarding the performance of the Indian economy during April-June quarter 2002. According to Central Statistical Organisation (CSO), GDP has gone up by 6 per cent during first quarter but this does not (and can not) perceive the impact of erratic and deficient monsoon rains that covered the period of July 1, September 30. A recent survey by Organisation of Economy Cooperation and Development (OECD), a Paris-based monitoring agency of the world economy has projected poor economic prospectus indicating that the world economy is losing steam. Germany’s largest bank, Deutsche Bank has also cut down its forecast for German growth this year to just 0.1 per cent from 0.5 per cent. The bank is of the opinion that there is a “mini-recession” in the economy. The Indian stock market is looking for announcement of corporate results for July-September quarter. So far the three companies that have declared results, have not encouraged the market. Pfizer has reported 4.49 per cent rise in its net profit for the quarter ended August 31. While Parke-Davis has reported 27 per cent fall in its net profit for the 3 quarter. Reliance Industry has also declared its results for the year ended March 31, 2002. These results include those of Reliance Petroleum Industry which has been merged in Reliance Industry. For this reason, this result is not comparable with that of the previous year. While the company has declared 47.5 per cent dividend, its results have not impressed the market. Last week, the news that the company has lowered the market price of its products also contributed to its sharp decline in the scrip’s market price. The market might react favourably if technological sector reports good results for the 2nd quarter. A headline news in the Economic Times dated October 5, 2002, indicating that the Prime Minister has made George Fernandes agree to the strategic sale of HPCL and BPCL, may also stabilise the market if it is confirmed by subsequent follow-up action. According to the compromise formula, as the news stated, the ONGC and GAIL may also participate in the biding as junior partners to private players, Indian or foreign. The Indian stock market needs some positive steps to bring back the investors to the stock exchanges. One possible steps can be to restore the tax-free dividend income in the hands of the receivers. CII has made a plea for this kind of action. “Hindu Business line” has also editorially called for such step to stabilise the dwindling stock market. Considering that Vidhan Sabha elections in Gujarat are around the corner during the current year and the Lok Sabha elections are due in 2004. It may not be a surprise that the Budget proposal for the next financial year may incorporate this concession for the investors. At present the market is so low that any investment in blue-chip scrips will be rewarding, provided the investment is made or a period of not less than two to three years. ABB and Larsen & Toubro have received good orders recently. The huge road-building programme of the Central Government is also likely to be implemented soon. |
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Inflation falls ICICI MF plan Hero Motors Honoured |
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