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Sunday,
October 27, 2002, Chandigarh, India  
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Invest in
rural projects: Shanta VAT: some
important aspects NRIs to
set up airport near Ludhiana Regularise
agro units: entrepreneurs Finolex
Cables net at 8.39 crore
Corpn Bank net up UTI Bank
net rises |
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Adjudication
of industrial dispute
Fleet
expansion of A-I on paper
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Invest in rural projects: Shanta Chandigarh,
October 26 It has suggested to work out projects that can be implemented in collaboration with the private sector like water management, tree plantation, building and maintenance of roads under the Prime Minister Rural Roads Yozana (PMRRY), said Mr Shanta Kumar, Minister of Rural Development, here today. He was speaking at the Rural Enterprise Summit, organised by the CII, Northern Region. Addressing industrialists, he called upon the private sector to invest in the rural infrastructure sector that would generate additional employment and benefit the private sector as well. Illustrating his point, said Mr Shanta Kumar: “Under the PMRRY, the government was investing about Rs 60,000 crore on village roads and about Rs 40,000 crore annually as assistance for the rural projects. The working group has cleared the proposal that the private sector should be allowed to plant trees on both sides of the roads, besides developing them for commercial purposes. The department was ready to provide land on lease along with these roads to the private sector and additional assistance to make projects viable.’’ The ministry was also considering the proposal of the cement industry to use cement for building village roads. The industry had claimed to build roads for about 20 years tenure with just 15 per cent extra costs. As an initial step, he said, the ministry had asked the
interested parties to built at least three roads in each state on experimental basis. Regarding the private partnership in the water management sector, he said, if 25 per cent of the total rain water could be commercially harnessed for fishery, irrigation and drinking purposes, it would create millions of jobs and income worth billions of rupees. Responding to the call of the minister, Mr R.M.
Khanna, Chairman, Economic Affairs, Sub-Committee, CII, Northern Region, assured him that a delegation of the CII would soon meet him to work out the details of projects and encourage its members to study the viability of the projects. Later, Mr Shanta Kumar inaugurated the exhibition on rural enterprises that would continue till October 30.
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VAT: some important aspects HOW far the proposed value added tax system aimed at substituting the existing mechanism of levy of sales tax can be said to be fair and rational unless the facility of input tax credit is provided to the trade and industry also on the transactions involving purchase in the course of inter-State trade or commerce? Is it not obligatory for the states to make appropriate provisions in the proposed VAT laws ensuring minimum cascading effect? These precisely have come to be widely known as the major two grievances of the trade and industry during the course of discussions held on several occasions in the State of Punjab in the context of the introduction of this new system. The Centre does not seem inclined to immediately abolish the five-decade old enactment, called, the Central Sales Tax Act, 1956, governing levy tax on inter-State transactions as it has decided to do away this system in a phased manner. Under the proposed legislations brought out by many states, it is provided that the facility of input tax credit shall be admissible to the VAT dealers only against the purchases on payment of tax made from within the state and that the facility of set-off will not come into play in relation to inter-State purchase of inputs made on payment of Central Sales Tax. This situation is bound to put the manufacturers of certain states to a disadvantageous position in which raw material required for consumption is not available. This can be exemplified in the following manners: “A” is a manufacturer in State “X” buys material from within the state on payment of tax on inputs. The tax paid by him in the form of state tax on the inputs becomes eligible for set-off as per the proposed provision. The tax liability falls on him in respect of the sale of manufactured goods after allowing benefit of set-off would be 10 per cent considering that the rate of tax applicable on the goods so sold is 10 per cent. If, on the other hand, goods are purchased in the course of inter-State trade or commerce on payment of 4 per cent CST and thereupon these are used in the production of finished items eventually sold in the State, total tax liability falling in that event would come to 4 per cent on inputs plus 10 per cent Value Added Tax applicable in that State as no benefit of set-off or input tax credit is allowed against CST. Interestingly, if raw material is purchased by, say suppose, “X” in state “A” on payment of CST from some other State he pays 4 per cent tax. While selling the finished goods in the course of inter-State trade or commerce to “Y” in state “B”, he as per the existing provisions of the Central Sales Tax Act, 156 again incurs 4 per cent tax liability. “Y” buying the goods virtually on payment of 4 per cent CST on inputs paid by the first seller plus 4 per cent by the manufacturer again is required to pay 10 per cent Valued Added Tax at the time of eventual disposal of the goods in his State regardless of 8 per cent tax paid directly or indirectly by him. Total liability in that situation will come to 18 per cent. How in such a situation, the dealers eventually selling goods in the State would be able to compete with a person selling the same goods directly from his state where he gets the facility of set-off against payment of VAT? This anomaly has necessarily to be avoided in the interest of trade and industry while introducing the new system of VAT in the states. One of the suggestions given in this context comes from Punjab that the benefit of set-off can be allowed to the VAT dealers on production of some declaration may be called C-I that should require to be issued by the person making inter-State sales. This procedure will also ensure proper verification of the transactions taking place in the course of inter-State trade or commerce thereby having a check on the evasion of tax. Instead of reducing the rate of tax on inter-State sales to zero per cent, the same can initially be reduced to 2% where the goods attract 5 per cent tax locally against form ‘C’ and in other cases the same can be determined @ 12.5 per cent. Another suggestion that comes from some of the states is that the Centre should impose VAT on the high-seas transactions to plug revenue leakage in respect of sales that are exempt from tax under subsection (2) of Section 5 of the Central Sales Tax Act, 1956. However, this too will create avoidable problems for the trade and industry. The solution to the problem of evasion of tax in the guise of high-seas sales can be tackled by introducing a declaration that all registered dealers buying goods in the course of import should legally be required to furnish at the time of purchase that he is a registered dealer under the Central Sales Tax Act, 1956. However, the levy of tax can be levied when the purchase comes to be made by a person having no registration or if the goods purchased by a registered dealer are sold to an un-registered dealer by way of transfer of documents of title to the goods. |
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NRIs to set up airport near Ludhiana SAS Nagar, October 26 This was stated by representatives of the Punjab NRI Entrepreneurs (PNRIE) while talking to mediapersons after an interaction with the Mohali Industries Association (Baidwan group) here today. They said that to start with $ 100 million would be spent on the airport project. After six months they proposed to bring $ 1 billion for further investment in Punjab. The Chairman of PNRIE, Mr Lukhbir Singh Gill, said the NRI group had come to India on the invitation of Capt Amarinder Singh, Chief Minister, Punjab, under the banner of “Punjab NRI Entrepreneur”. The main purpose of the visit was to explore possibilities of NRI investment in Punjab. The areas identified for investment were agro-processing, information technology, education, infrastructure, tourism, real estate etc. Shortly an office would be opened in Chandigarh. This office would accelerate the process of NRI investment by providing all necessary help and information to the prospective entrepreneurs, including tie-ups with local entrepreneurs. |
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Regularise agro units: entrepreneurs Yamuna Nagar, Oct 26 In a representation to the Chief Minister representative of the association said on October 24 some sheds and buildings were demolished by he Town and Country Planning Department causing heavy losses to
entrepreneurs. The department was raising objections in registering new units on the pretext that
NoC/LCU from the department was required. The representatives said even certain units had received notices from the department to fulfil the norms. Their units are registered with various government departments i.e. the Factories Department, the Labour Department, the District Industries Centre, the Sales Tax Department etc.
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Finolex Cables net at 8.39 crore FINOLEX Cables has reported a net profit of Rs 8.39 crore for the quarter ended September 30, 2002, compared with Rs 7.22 crore for the corresponding period last year. The total income for the quarter is at Rs 118.63 crore. United Phosphorus United Phosphorus has reported a 32.39 per cent increase in the net profit at Rs 16.39 crore for the second quarter ended September 30 as compared to Rs 12.38 crore in the same period previous year. The company’s net sales in the reporting quarter have increased to Rs 221.5 crore as against Rs 209.86 crore in the Q2 of 2001, United Phosphorus said here today. Gail net rises Gas company GAIL (India) Ltd today reported a 32 per cent rise in its net profit to Rs 717 crore in the first half of current fiscal from Rs 544 crore.
Agencies
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Corpn Bank net up
Mumbai, October 26 The Bank, which suffered at the interest spread income in the previous quarter, recovered to 3.4 per cent during the quarter as the exposure under sub-PLR lending contained to 10 per cent from 17 per cent of the total credit portfolio of the bank. The Bank also earned a higher income from its treasury operation at Rs 74.35 crore during the quarter under review as against Rs 34.82 crore in the same quarter previous year.
UNI
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UTI Bank net rises Chandigarh, October 26 For the half year ended September 30, 2002, the bank has achieved
substantial growth in balance sheet size as well as profits. The operating income of the bank has grown to Rs 309.52 crore in the six months ended September ’02 from Rs 260.27 crore in the six months ended September ’01.
TNS |
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IOB net jumps New Delhi: Indian Overseas Bank said today that its net profit had jumped by 42.7 per cent to Rs 87.97 crore for the quarter ended September 30, 2002, from Rs 61.61 crore in the same period last year. For the first half this fiscal, the net profit went up by 32.2 per cent to Rs 160.93 crore from Rs 121.66 crore a year earlier.
PTI |
by Praful R. Desai Adjudication of industrial dispute Q: Is the purpose of reference of an industrial dispute simply for the purpose of adjudicating that dispute only? Whether second reference of the same dispute possible. Ans: This matter was decided by the S.C. in Virendra Bhandari v R.S.R.T.C. (2002-II-LLJ 256) for adjudication. In spite of the notice, appellant — workman remained ex parte. Consequently, the same reference was disposed of, stating that as the appellant had not evinced any interest in the dispute. Restoration was also refused on the ground of delay. Hence, government made a second reference of the same dispute. On this occasion, the Tribunal adjudicated the matter and gave the award which was challenged before the H.C. The H.C. held that second reference was incompetent since the dispute had already been adjudicated in the earlier reference. Matter was thus carried to S.C. The S.C. observed that a perusal of the award will clearly indicate that there is no adjudication of the dispute at all. All that was stated was that the concerned parties had not appeared before the Tribunal and in such an event, the Tribunal should have noted its inability to record the finding on the issue referred to it, not that the dispute does not exist. When there is no adjudication of the matter on merits, it cannot be said that the industrial dispute does not exist. If the industrial dispute still exists, as is opined by the government, such a matter can be referred U/S 10 of the I.D. Act. What is to be borne in mind in proceedings of this nature is that the industrial disputes are referred to the Labour Court or the Industrial Tribunal for maintenance of industrial peace and not merely for adjudication of the dispute between two private parties. That aspect seemed to have been lost sight of by the Tribunal on the first occasion and by the H.C. in the order under appeal. In this background, it was certainly permissible for the government to have made the second reference on which occasion after inquiring into the matter, the Tribunal adjudicated the matter finally. Therefore, the S.C. set aside the order made by the Division Bench of H.C. affirming that of the learned Single Judge and remit the matter to the H.C. restoring the Writ Petition for fresh consideration on merits. The S.C. further directed that the Writ Petition for fresh consideration on merits. The S.C. further directed that the Writ Petition be heard and disposed of by the Division Bench of the H.C. In
that way, the present were allowed by the S.C.
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by K. R. Wadhwaney Fleet expansion of A-I on paper FROM a modest start in early 1930s, Air-India rose to become a “Maharaja” under the dynamism of JRD Tata. Air-India’s blues began with the unceremonious exist of JRD. The interference of bureaucracy and politicians has increased. At 70 plus, it is leading a chequered existence but the powers that-be continue to make lofty claims that Air-India has set Rs 100-crore profit target for the year. Air-India’s history since its birth is being shown on a big screen at Nariman Point. Minister for Civil Aviation Shahnawaz Husain said: “We have already achieved about Rs 40 crore profit in the first six months of this fiscal”. The fact of the matter is that there is no culture in Air-India at present. Discipline is at a discount. Employees are no longer proud of saying that they belong to Air-India. Hostesses project a very poor image of the airline, while “Maharaja” lounger are more used for politicians and bureaucrats than for genuine regular flyers. In 2001, a managing director of the airline was suspended on flimsy grounds and was reinstated 2-3 days before his retirement. The suspension and reinstatement made a mockery of the whole episode. The fleet expansion is merely on papers as one unit approves it and another body rejects it. Meetings are held and expenditure is incurred without achieving any tangible result. New routes are chartered and huge expenditures incurred on lavish get-togethers but Air-India continues to stay in turbulent weather. While experienced staff in New York is being done away with, thrice weekly services on India-Paris-New York (New Jersey sector) will commence from December this year. It will be seen whether these flights become popular, or the airline will incur further losses because of haphazard planning and programme. Aviation experts opine that Air-India’s happy days will emerge only when the airline is run commercially without injecting personal likes and dislikes. In an age of public relations, the officials concerned in Delhi, for example, will have to be more realistic than narrow minded. Immense potential The two-day international convention, organised at Chandigarh by the Forum of Educators and Scholars of Tourism and Aviation, has provided a lot of focus on aviation and tourism, which, if handled judiciously, can help the country march onwards. If Thailand, Malaysia, Singapore and Hong Kong can thrive on these two units, why not India, which has more resources than all these countries put together. |
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