Investor guidance

Strange rule governs senior citizen’s joint account
Q: Has the following eventuality been covered by the framers of the rules for the Senior Citizens’ Savings Scheme? Each senior citizen is permitted to invest up to a maximum of 15 lakh in this scheme, jointly with the spouse at choice. Hence a man may hold a deposit jointly with his wife, and the same lady may hold another deposit jointly with the same man.

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Insurance cover helps the poor in western village.  (28k, 56k)

New Delhi, January 22
The government has come out with stringent guidelines, which would govern Indian carriers wanting to fly abroad, and ensure that non-serious airlines do not make an attempt to try their hands at flying on international routes without experience and in the process tarnish the image of the country.

In the guidelines finalised by the Directorate General of Civil Aviation (DGCA), it has now been decided to ban the airlines from flying on a particular route for two years if they fail to fully utilise the rights granted for that route.

The guidelines, which were finalised yesterday, also have the provision of reviewing the entitlements on foreign routes in case any of the airlines, permitted to fly internationally, reduce their domestic operations.

The Union Cabinet while clearing the way for the private domestic airlines to fly abroad last month had, however, put forward a condition that the airlines which would be allowed to fly abroad must not only have at least five years of experience of flying within the country but also must have a minimum mileage coverage. It had said that such airlines must at least have 20 aircraft in its fleet.

Following the drafting of the new guidelines the top officials of the Civil Aviation Ministry also had meeting with the senior representatives of Air India, Indian Airlines, Jet Airways and Air Sahara. The representatives were briefed about the new guidelines and further information was sought from them on the new issues within a week.

The above four airlines, which qualify to operate on global routes, have already submitted their operational plans for the ensuing summer season and the winter schedule.

Sources here said that the Ministry however, now wants them to provide more details about their plans within a week to enable it give a final nod to their international operations.

These include, as per the Union Cabinet instructions, details of the number and size of aircrafts, details on the pilots who will operate on foreign routes, arrangements of these operations, availability of slots and maintenance facilities at foreign destinations.

Under the new guidelines, the allocation of traffic rights to scheduled airlines would depend on the availability of traffic rights to particular countries.

If the total entitlements fall short of the requirements projected by the eligible airlines, the allocation of entitlements would be made on the basis of the average seat per kilometres (ASKMs) deployed by the airlines on domestic routes over last five years, the sources said.

The ASKMs in the domestic sector would be determined twice a year on January 1 and July 1.

According to sources traffic rights allotted to a particular airline in a year would have to be utilised in the same period. The airline’s failure to utilise traffic rights once granted would lead to a ban of two years on that route.

Entitlements to a scheduled carrier may be reviewed if any of them reduced the domestic operations after obtaining the traffic rights on international routes.

Notwithstanding these guidelines, the government would have the discretion to permit or deny allocation of rights in view of the preparedness of the airlines, viability of their operations and overall interests of the civil aviation sector in the country, sources said.

Bangalore, January 22
Chile President Ricardo Lagos Escobar today visited Hindustan Aeronautics Limited (HAL) where he witnessed demonstration flights of the Light Combat Aircraft (LCA) Tejas, the Advanced Light Helicopter (ALH) Dhruv, and the Intermediate Jet Trainer (IJT). Karnataka Governor T.N. Chaturvedi was also present.

Mr Escobar was accompanied by his wife and a large delegation. He departed immediately afterwards in an Indian Airlines plane. “I am happy to have made this visit, and I hope to come here again,” he said. He however declined to accept aircraft models of the ALH and the IJT offered to him as mementoes.

Chile has evinced interest in the ALH-Dhruv helicopter. HAL Chairman Ashok K Baweja did not confirm recent reports from New Delhi that Chile had agreed to ink a deal for four helicopters.

As a part of an aggressive export thrust from HAL, a demonstration by four Dhruv helicopters, equipped with electronic warfare suite and surveillance pod, was conducted in Chile a few months ago. The helicopters flew in conditions ranging from high altitudes to desert-like terrain, and carried out ship-deck landings, search and rescue, and long distance ferry flights up & down of over 1800 km each way.

Mumbai, January 22
Anil Ambani, who is locked in a bitter battle with his brother Mukesh over the control of Reliance Industries Ltd, has been quoted as saying that no request has been made to him to withdraw his resignation from the board of the IPCL. According to the report, no such request was made to Anil Ambani by the board of the IPCL. Earlier reports from the Mukesh Ambani camp said Anil had refused to reconsider his resignation.

Anil Ambani had resigned from the post of Vice-Chairman and director of the IPCL earlier this month saying he could not sit on the same board as Anand Jain, an associate of Mukesh Ambani. Anil went on to accuse Jain of trying to divide the two brothers. “I have not heard anything from the company but directionally there are substantial, major issues on governance, on disclosures about related party transactions and pecuniary issues,“ Anil Ambani has been quoted as saying.

Agency reports say that Anil Ambani demanded a “fair and equitable solution” for all members of the Ambani family.

Responding to reports of his elder brother Mukesh Ambani seeking a meeting with him, a spokesperson for the younger Ambani said in a statement that “Anil wants a fair and equitable solution for all members of the Ambani family and millions of Reliance shareholders.”

Anil’s statement came a day after it was revealed that elder brother Mukesh had been seeking a meeting with him since November 30 to resolve the differences.

The younger brother, however, responded by saying a meeting could be productive only if a “fair and equitable” solution was proposed and he was willing to talk to his brother immediately thereafter in the presence of mother Kokilaben and other family members.

“For several weeks, and for their own selfish motives which are apparent to everyone, the three Cs — chamchas, chelas and cronies — through a sustained campaign of disinformation, denied the existence of any family process to derail the process of finding an internal solution,” the statement said.

In a frontal attack on Mukesh’s advisors, Anil’s spokesman said: “Not surprisingly, the 3Cs have now done a volte face, and finally confirmed — based on an avoidable publication by them of the family’s private and confidential communications to each other — that there is a process underway, for resolving matters concerning the Reliance Group and the Ambani family.”

The response from Anil came within a day of disclosure of Mukesh’s letter urging the younger brother “beta let us meet; all issues are accumulating.”

New Delhi, January 22
Taking cue from the ‘super saver’ schemes of its competitors for attracting frequent fliers, low-cost carrier Air Deccan today announced two separate schemes for its trunk and regional operations.

Under the Super Flier scheme for regional sectors operated by the airline’s nine ATR aircraft fleet, a passenger can buy 30 tickets at Rs 50,000 which translates into Rs 1,666 per ticket, an Air Deccan release said.

The Super Flier Plus scheme, to be operated by its three Airbus A-320 fleet, provides 36 tickets at Rs 1 lakh, which works out to Rs 2,777 per flight. These tickets could also be used on the ATR routes, it said.

This would mean that a Bangalore-Delhi ticket in this scheme would cost Rs 2,777 only compared with second AC rail ticket worth Rs 3,070, the release said. — PTI

Investor guidance

Strange rule governs senior citizen’s joint account
by A.N. Shanbhag

A: When one of the joint account holder dies, the surviving spouse can continue the account, only if the spouse does not have another account, even if the total deposits in both accounts are well within the limit of Rs. 15 lakh. Strange!

House rent

Q: I am posted in a city other than my residence and paying house rent.

I have taken a bank loan for purchasing a flat near my residence and the construction is to be completed by February 2005 and already I have started paying EMI.

Please let me know if I am eligible for reduction of interest part as per the present IT rules and also can show the rent paid from salary as deductions.

— Nalin

A: It is presumed that you have taken the loan during the current financial year. In that case, you are eligible for all tax concessions on the housing finance, including the deduction of interest, with associated ceilings and the tax rebate u/s 88 on repayment of loan up to a ceiling of Rs. 20,000.

Both tax concessions, rebate and deduction of interest are allowed only when the income from house property becomes chargeable to tax. In other words, the construction should be complete, the flat should be ready for occupation and the municipal annual value is known.

The interest for the years prior to the year in which the property was completed, shall be deducted in equal instalments for the year during which it was completed and each of the four immediately succeeding years. Unfortunately, there is no corresponding provision for the tax rebate.

If the construction or acquisition is completed anytime in a FY, the interest paid during the entire FY is deemed to be the normal interest though a part of the FY is pre-construction period.

VRS

Q: I have taken voluntary retirement in December 2002. I, however, attained the age of 55 years in April 2004. Can I invest my savings in the Senior Citizen’s Saving Scheme announced in the July 2004 budget?

A: You could have but within one month from October 28, 2004, when the notification regarding those who have already retired was issued. Hopefully, in the forthcoming budget they may give some additional time relief.