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Industry rolls
out red carpet for Manmohan Singh FIIs continue to
pull out from markets India’s forex
reserves up at $ 118.62 bn
Expanding for
incentives’ sake Punjab units
expect sops from govt |
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Thomas Cook posts
43 pc growth
IGIA needs new
terminal building
Incentive for
upgrading qualification taxable
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Industry rolls out red carpet for Manmohan Singh
New Delhi, May 22 “Under Manmohan Singh’s leadership, the process of economic reforms would be sustained and the country would be able to grow at an annual rate of 7-8 per cent,” CII President Anand Mahindra said. He expressed confidence that India would be able to attain 10 per cent growth with sustained reforms. FICCI President Y K Modi said “Industry is happy and confident that Dr Singh and his council of ministers will deepen and broaden the reform agenda and
forces on governance and implementation of issues drawing from their wealth of experience.” Welcoming the draft Common Minimum Programme, Assocham President M K Sanghi said “The new government’s emphasis on urban rural connectivity by extending support to agri sector will create conducive environment to enhance purchasing power in the rural sector, create agri-entrepreneurship class and give impetus to the industrial growth.” Speaking on same lines, PHDCCI said “if the economy has to sustain high growth, capital expenditure by government for agriculture has to increase on a sustained basis.” Congratulating the Union ministers, Mahindra said “the new coalition government led by the Congress will work strongly in the areas of infrastructure development, manufacturing growth, rural economy, healthcare, education and water management. Supporting the new government’s decision of not privatising profit-making PSUs, Sanghi said “Assocham extends full support in this direction but wants the government to give them autonomous power to make them globally competitive.” He stressed on early implementation of Value-Added Tax to remove artificial barriers and corruption in the development of a common market. Assocham also hoped that Mr Singh will take serious measures to curtail unproductive expenditures and reduce the size of the government, wherever possible, by merging some of the ministries or departments. The CII offered full support and partnership to the new government in its tasks of development and growth. PHDCCI said the new
government should step up investments in irrigation facilities, cold storages, post and pre-harvest processing facilities and rural roads.“Necessary steps shall have to be taken up by the state governments in particular, to enhance government spending on agri infrastructure and improve production,” it said. The PHDCCI also proposed higher spending on R&D in non-traditional and cash crops like pulses, oilseeds, cotton, sugarcane, horticulture and animal husbandry.
— PTI
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FIIs continue to pull out from markets
Mumbai, May 22 The fluid political scenario and fears of a slowdown in economic reforms and disinvestment programmes prompted the foreign funds to reduce their exposure in the Indian markets after continuously pumping funds in for nearly 60 weeks, brokers said here today. The FIIs have pulled out Rs 3,197.10 crore from the equity/debt markets till May 21 as against their net investment of Rs 6,719.50 crore in April. With the net selling in the last 13 straight sessions for a total Rs 3,288.8 crore since May 5, the FIIs investments since January, 2004, have dropped from Rs 19,706.7 crore on April 30 to Rs 16,509.6 crore as on May 21. According to data available with SEBI, the FIIs have sold equities worth Rs 6,147.6 crore during the week as against their total purchase for Rs 5,186.2 crore showing a net sales for Rs 961.4 crore. The FIIs also unwound debts worth Rs 57.2 crore during the week. Foreign funds were net sellers in equities all five trading sessions. During the week, the stock markets also witnessed historic intra-day volatility due to political and reform worries, forcing the stock exchanges to halt tradings twice on Monday after indices hit the circuit filters. The Sensex which tanked a staggering 565 points, its biggest one-day fall in a decade, bounced back by 500.94 points in the next two trading sessions. For the week the BSE barometer ended 108.30 points or 2.1per cent lower at 4,961.57 while the S&P CNX Nifty shed 22.20 points or 1.4per cent at 1,560.20.
— UNI
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India’s forex reserves up at $ 118.62 bn
Mumbai, May 22 The country’s foreign currency assets increased by $ 70 million to $ 113.16 billion during the period under review, according to Reserve Bank of India’s weekly statistical supplement issued here today. Gold reserves and special drawing rights remained static at $ 4,191 million and $ 2 million respectively. India’s Reserve Tranche Position
(RTP) with the International Monetary Fund (IMF) declined by $ 21 million to $ 1,270 million, the central bank added. Loans and advances to Central government showed a nil balance while that to state governments were up by Rs 569 crore to Rs 4,005 crore, RBI added.
— PTI
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Mukesh Ambani honoured
Mumbai, May 22 Asia Society Chairman Leo Daly presented the award to Ambani yesterday at a function held in Washington, RIL said in a release here today. The award was bestowed in recognition of his exemplary contributions to the development of modern Indian economy, a crucial factor in the closer ties between India and the United States.
— PTI
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Expanding for incentives’ sake Solan, May 22 While industrial houses are keen to avail the incentives in the form of outright excise and income tax holidays, there is a little scope for the generation of employment. The officials say a 10 per cent jobs will be created by the expansion. Inquiries revealed the industrial houses preferred to appoint either a few workers or manage with their old staff who were trained in new technology. Officials of the Income Tax Department said some industrial houses were now opting for starting phase two units which would help them avail the benefits. While no benefits were being granted on purchase of old machinery a novel way of setting up ancillary units was catching up in the region, particularly in the Baddi-Barotiwala-Nalagarh area. It was an uphill task for the officials of the Industries Department to ensure that genuine industries came up and they did not wind up after the incentive period ended.
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Punjab units expect sops from govt Ludhiana, May 22 Enquiries made by this correspondent reveal that more than 100 hosiery units have come up at Baddi and Parwanoo. Mr Vinod Thapar, president of Knitwear Club, said Dr Manmohan Singh, during his visit to Ludhiana in connection with the election campaign, assured them that the Congress would extend similar benefits to the hosiery industry if returned to power. Now since the Congress government was being formed under Dr Manmohan Singh, the industry was hoping that the assurances would be implemented. Mr Thapar expressed his dissatisfaction with the performance of the Punjab government on the industrial front. Besides, hosiery and readymade garments units, a number of steel plants (induction furnaces) and steel re-rolling mills have moved to Baddi, Parwanoo and Paonta Sahib. Mr R.P. Bhatia, Vice-Chairman, All-India Steel Rerolling Mills, says power supply is also cheap in Himachal and Uttaranchal compared with the power tariff in Punjab. Some steel units have also been set up in Orissa. “We have been demanding benefits for expansion of our units but the Central Government did not pay any heed,” laments Mr Bhatia. Mr Tulsidas Jaitwani, President, Punjab Beopar Mandal, said the Punjab government promised to abolish the octroi but did not do anything when the neighbouring states had abolished it. The result was that Delhi had become the biggest trade centre of the country and scene had shifted from Amritsar. The traders and the industrialists are hoping that the Central Government led by Dr Manmohan Singh will take care of the industry.
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Thomas Cook posts 43 pc growth
Mumbai, May 22 The leading travel and related services provider and a publicly listed company follows the financial year from November to October in alignment with its international parent firm, Thomas Cook AG. It claims to have closed its books of accounts for its second quarter, ended April 30, 2004, on a highly profitable note. “This season has been good for us. All our businesses have shown a strong performance and we have achieved beyond desired targets,’’ Ashwini Kakkar, CEO and Managing Director, Thomas Cook (India) Ltd told media analysts here last evening. Mr Kakkar feels that this quarter has been exciting for Thomas Cook and the travel industry in India. “The sensational rise of the Sensex during this period, the general
feel good factor of the market, the lucrative tax incentives given to the travel industry
in the pre-budget, all helped boost the travel industry, he stated. — UNI
ICICI Bank net profit at Rs 522 cr under US GAAP Mumbai, May 22 As per the US GAAP norms, the profits before provisions against loans, investments, taxation and effects of accounting charges, stood at 2,451 crore ($ 545 million) for FY-04 as against Rs 1,122 crore ($ 249 million), ICICI Bank said in a release here today.
— PTI |
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by K.R. Wadhwaney IGIA needs new terminal building As the new government is about to take over, there will be wide-range changes in the functioning, culture and set-up of aviation. Air-India and Indian Airlines have already started breathing free as new minister will not be as ‘beholden and patronising’ to private establishment as the two previous ministers, Shahnawaz Hussain and Rajiv Pratap Rudy, were. The skies will remain open. Maybe, they will open more. But the play-field will be
a level and A-I and IA will not be accorded step-motherly treatment. Both airlines are bound to get clearance for buying new aircraft, long-haul and medium capacity, to fly to new destinations and routes. Once fleet is augmented, A-I and IA will not be as much under pressure from private operators as has been the case at present. Private operators may continue to fly to neighbouring countries, as “clearance” has been accorded and operations have already begun, but they are unlikely to get an additional quantum of facilities. What is the need of the hour is to render international airports friendly so that tourist traffic grows. As of now, there is only talk and little progress. The airports in Delhi and Mumbai are extremely congested and “cosmetic” alterations will not help matters. New terminal building with ultra-modern facilities and enlarged runways have got to be constructed at war-footing. The Airports Authority of India (AAI) has enormous funds lying unutilised. It has to utilise funds on meaningful projects, instead of on meaningless schemes to curry favours of some politicians. When the Indira Gandhi International Airport was commissioned in 1980s, it was announced that another module would come up before 1990. Delhi is already behind by about 15 years and any further delay in opting for new terminal building will be counter-productive to the growth of the aviation and tourism.
Lufthansa While most of India’s plans continue to be on drawing board, Lufthansa has already identified India as one of the most lucrative markets in Asia. The airline, one of the most professional outfits, has announced its three-year strategy. Lufthansa has plans to expand its air catering arm LSG Sky Chefs in India, open a fifth point in South India and increase capacity by introducing super jumbo Airbus A-380. |
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by A.N. Shanbhag Incentive for upgrading qualification taxable
Q: I read in your column that incentive given by the employer to employee for upgrading his qualification is not taxable under IT Act. I am employee of PSU. I acquired higher qualification during my job through correspondence course. My employer give me Rs 7000 as per policy on completion of MBA but also deducted tax on this amount. I am in 30 per cent tax bracket. Tell me whether I can get refund of this amount from IT dept. or not .and how. with regards. — Dinesh Rana, Panipat
Ans: Repayment of loan as well as interest thereon by an individual taken from a bank, a notified financial institution or any approved charitable institution for higher education is deductible up to a ceiling of Rs 40,000 per year for eight successive years starting from the FY in which the assessee starts repaying the loan or interest thereon. Loans given by employers are not eligible unless the employer happens to be one of those indicated above. Higher education means full-time (not part-time) studies for any graduate or postgraduate course in engineering, medicine or management or a postgraduate course in applied or pure sciences, including mathematics and statistics. Obviously, you are not eligible to this benefit because you have neither taken a loan nor was it a full-time course.
Q: My Gross Taxable Income Exclusive of Capital Gains is Rs 4,50,000. During the year I sold some shares and my long term capital Gains is Rs:3,50,000.
My Queries are: 1. Can I claim rebate under Sec:88 and chapter VIA on Rs:4,50,000 if I pay capital gains Tax @10per cent on Rs 3,50,000/-. 2. If not then, to avail the benefit of rebates U/s 88 and chapter VIA do I have to invest entire capital gain of Rs 3,50,000 in specified bonds such as Nabard, REC, so as to keep my gross Taxable Income below Rs: 5,00,000/-. — Mrs Devi Sanghvi.
Ans: Yes, you are right. Ans Gross total income includes capital gains. You can claim exemption u/s 54EC (or 54ED) by buying infrastructure-related Bonds of NHB, Nabard, etc., and bring your gross income down. Q: I have outstanding long term capital loss in the previous eight years and have shown it in my IT return. During the current FY, I have made some long term capital gains as well as some long Term capital loss with the result that the net position is Net capital Loss. Is it permissible to set off long term capital gain of this year (without adjusting the long term capital loss of this year) against the long term capital loss incurred in the preceding eight years and carry forward the long term capital loss of this year for next eight years. To illustrate with an example. Long Term Capital Loss (AY - 96-97) - 35,000 Long Term Capital Loss (AY- 97-98) - 20,000 For AY (04-05) Long Term Capital Gain - 60,000 Long Term Capital Loss - 1,00,000. Can I set off the Long term capital gain of Rs. 60,000 against my previous years losses in AY 96-97 and AY - 97-98 and carry forward the Long term capital loss of this year of Rs. 1,00,000 for the next eight years. — Vineet
Ans: Sec. 70 allows set off of loss from any source falling under any head of income against income from any other source under the same head. Sec. 71 allows balance losses under one head of income to be setoff against income under any other head with three exceptions related to - i) Capital gains ii) Speculative business and iii) Business of owning and maintaining of horses for races. In these cases, the net loss can be carried forward for setoff against the profits and gains only from the same source. The excess loss, if any, can be carried forward to the subsequent year. Such a carry forward is allowed for only 8 years (4 years for horse races) immediately succeeding the year for which the loss was first incurred. The loss suffered during the year can be setoff against income under any other head but strangely, the carried forward loss can be setoff only against income under the same head. The main Act is silent on whether it is mandatory to setoff this loss against the income when it exists. The Punjab & Haryana high court, in the case of B.C.S. Kartar Chit Fund & Finance Company Pvt. Ltd. v CIT [1989] 179ITR137 has observed that where losses sustained are not setoff against the profit of the immediately succeeding year or years, they cannot be setoff at a later date. Going by that ratio, you could set-off loss of earlier years first and carry forward the loss of the current year. |
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