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High duty on power gadgets affects
government target
Women who made it Aviation
Notes A jumbo fallacy is persisting in Indian corridors that aviation skies have been widely opened. The fact is that skies remain partially open since liberalisation in the 90s. But what has significantly opened is Boeing spreading its wings in a jumbo-style in Indian skies. Investor
guidance Q: I am an NRI, who is earning interest from my NRO account. Section 194A of the Income Tax Act exempts interest paid up to Rs 5000. Moreover as per my understanding, interest paid on savings account are not subjected to TDS. However, the bank has deducted TDS @ 30.6 per cent. Why is this and what is my remedy? UTI Bank targets women with Smart Privilege New Delhi, April 23 UTI Bank today launched a savings bank account designed specially for women, offering personal accident insurance cover and investment options besides a host of value-added services.
Anil’s resignation was accepted, says
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High duty on power gadgets affects government target New Delhi, April 23 Consequently, the state electricity boards have failed to bring down the transmission and distribution (T&D), varying up to 50 per cent in some states, and caused losses worth thousands of crores to them and further delaying the power reforms in the country. In fact, the state electricity boards have lamented that high import duty, along with countervailing duty (CVD) is as high as 39.2 per cent on switch gears, cables, transformers, and 33.4 per cent on meters and meter reading instruments and capacitors and 27.6 per cent on modems. All these instruments are required to ensure 100 per cent metering in the towns and rural areas. Due to shortage of meters and required funds, the state boards have still to install meters in the agriculture sector. According to Power Ministry estimates, since sub-transmission and distribution network at present accounts for over 50 per cent of the losses in the sector, the government’s thrust has shifted to reform the sector. The government has already committed funds worth Rs 40,000 crore under the Accelerated Power Development and Reform Programme. Criticising the government for keeping high duties, a parliamentary committee associated with the Power Ministry has pointed that basic customs duty for plant and machinery and equipment in transmission, sub-transmission and distribution has already been brought down to 10 per cent. The parliamentary committee has asked the ministry to take up the matter at the highest level.
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Chandigarh Rose Princess of 1971 is a top banker today Tripti Nath Tribune News Service New Delhi, April 23 Chandigarh-born Manisha, who joined the UBS in 1998, says that the role of women in client servicing is very good. “In client servicing, nobody brings the sincerity, aggression and dedication that a woman brings. At present, we have 100 employees in India, including back office staff. Of these, 30 per cent are women. In our expansion plans, we would like to add to the number of women employees. In the ICICI, top management is an all-women force. Besides, foreign banks like the HSBC, Morgan Stanley and J.P. Morgan employ a lot of women.” The widely-travelled MD, who had her initial schooling in Carmel Convent in Chandigarh and Loretto Convent, Shimla, misses City Beautiful, particularly, Nek Chand’s Rock Garden and Sukhna Lake. She goes blushing when her mother, Promila, recalls that she was adjudged the Rose Princess during the Rose Festival in 1971 and The Tribune carried her picture. Promila Girotra, who used to teach Mathematics in Government Senior Model School, Sector 16, takes pride in the fact that her daughter has always been a topper. A gold medallist from the Delhi School of Economics and a topper in Economics (Honours) from St. Stephen’s, 35-year of Manisha holds a postgraduate degree in Economics and has had a short stint in London Business School. Having worked with Grindlays from ’92 to ’94 and Barklays from ’94 to ’98, Manisha knows the tricks of banking. She comes from a family of bankers. Her father, Satish Girotra, was the head of the western India and later northern India operations for the UCO Bank in the ’80s. Her brother works with ABN Amro in Singapore. While introducing her husband, Sanjay Agarwal, who is heading investment banking operations in India for Deutsche, Manisha says: “He is my biggest competitor and rival. We are competing for business.” Based in Mumbai, India’s commercial capital, Manisha has a hectic schedule. Her work includes travelling for banking road shows that are stressful and need 13 to 14 sittings a day to showcase the potential of a company. The most recent banking road show that UBS did was for Jet Airways. “The $ 460-million deal was oversubscribed 20 times,” she says. “Before this, our banking road show for the ICICI was very successful. It yielded the largest ADR out of India to date ever. The $ 450 million deal was oversubscribed four to five times,” says Manisha. Manisha is optimistic about the future of retail banking in India. “There has been a stupendous growth in retail banking in India both in the quality and size of business. The single most reason for this is competition. HDFC and ICICI give customers the quality of a multi-national bank at the cost of a public sector bank. State-owned banks are doing a fantastic job.” On the domestic front, Manisha tries to give her two-year old daughter quality time in between her meetings and overseas travels. “Motherhood is not easy but in India, one has a great support system of parents and in-laws. So it is manageable. Between my daughter and my job, I can only catch up with newspaper and magazine reading when I am travelling.” Does she find any time to cook in her fast-paced daily grind? She says: “I would like to cook, but I don’t cook at all. I can survive on pasta, noodles, tea and custard.”
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Boeing to gain from Indo-US pact by K.R. Wadhwaney A jumbo fallacy is persisting in Indian corridors that aviation skies have been widely opened. The fact is that skies remain partially open since liberalisation in the 90s. But what has significantly opened is Boeing spreading its wings in a jumbo-style in Indian skies. The airline trade is essentially a commercial venture. It should be conducted as it has been since World War II to promote tourism and aviation. But, of late, powerful governments have begun polluting the skies with their uncalled for influence and interference. The India-US Civil Agreement further opens the door for frequencies between the two countries. On the face of it, it looks a bold step being pursued by the Indian Government. But the subtle agenda shows that the 50-year-old treaty has been changed not with a view to promote aviation and tourism in the country but to provide jumbo presence to Boeing in the Indian skies. The US Transportation Secretary Y. Mineta said: “India has told us that due consideration would be given to the offer of the American aircraft major, Boeing, to Air-India and Indian Airlines for their fleet acquisition plans.” This vital announcement came after President George Bush had spoken to Prime Minister Manmohan Singh. The airline bigwigs, connected with aviation for decades, are of the firm view that this kind of political influence will, in the long run, be counter-productive. According to reports, Air-India is expected to buy all 50 aircraft of different sizes and capacities from Boeing. The Indian Airlines, again according to reports, was inclined to buy bulk of aircraft from Airbus. But needless delay in executing this order has given rise to suspicion to officials of Indian Airlines. They apprehend, may be, there will be another twist to the already murky situation existing in the Indian civil aviation sector. The fact is that both national carriers and also private operators need additional fleet to spread their wings and compete with foreign carriers. But unlimited frequencies to the US and back will not be commercially viable because traffic between these two countries will not increase to the extent some over- zealous officials are announcing.
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Investor guidance Q: I am an NRI, who is earning interest from my NRO account. Section 194A of the Income Tax Act exempts interest paid up to Rs 5000. Moreover as per my understanding, interest paid on savings account are not subjected to TDS. However, the bank has deducted TDS @ 30.6 per cent. Why is this and what is my remedy? — Jog A: While it is true that Section 194A provides for an exemption of Rs 5,000, the same is applicable only to a resident Indian. The TDS provisions for NRIs are governed by Section 195, which does not envisage the said exemption. However, if your final tax liability is lower than the TDS amount, you may file a return and claim a refund of the TDS.
Tax on gift
Q: If a
housewife or a school/college going kids receives an amount to the
saving account for the purpose of either gift or education for self or
for kids, then is that amount taxable to that individual? — Neeraj
Pandya A: Where any sum of money exceeding Rs 25, 000 is received
without consideration by an individual from any person on or after
September 1, 2004, the whole of such sum is taxable as income, unless
this receipt is from a relative. The purpose of the gift is
inconsequential and immaterial. The term relative means: i) Spouse of
the individual; ii) Brother or sister of the individual; iii) Brother
or sister of spouse of the individual; iv) Brother or sister of either
parents of the individual; v) Any lineal ascendant or descendant of the
individual; vi) Any lineal ascendant or descendant of the spouse of the
individual; vii) Spouse of the persons referred in clauses (ii) to
(vi). Section 80C
Q: In Budget 2004, according to my understanding,
it was provided that tax on short-term capital gain would be 10 per cent
but no relief is available under Section VI. I want your able guidance
for the changes made in Budget 2005. It is proposed that under Section
80C, an individual or HUF can save up to Rs 1 lakh and this saving is
reduced from the total income. Can amount saved from short-term capital
gain be reduced from the total income? — R. K. Bedi A: Section 111A
(1) dealing with short-term capital gains requires short-term gains to
be taken as a separate block and deductions under Chapter VI A are not
allowed. Where the gross total income of an assesse includes any
short-term capital the deduction under Chapter VI-A shall be allowed
from the gross total income as reduced by such capital gains. For a
resident individual or an HUF, where the total income as reduced by the
STCG, which is charged to tax @10 per cent falls below the tax threshold
of Rs 1 lakh, the gains would be reduced by the amount by which the
total income so reduced falls short of Rs 1 lakh and the balance of the
gains would be taxed @10 per cent. In short, where the tax liability
arises only because of inclusion of such short term capital gains in the
total income, tax is levied at the flat rate of 10 per cent on the
excess over the minimum taxable limit.
Service tax on MF
Q: I
receive brokerage from the MF directly and am not sharing with any sub
brokers. Do I have to pay service tax on it? — Namit Bathena A:
Mutual fund distributors have to pay service tax. This issue has been
mired in controversy over the last year. However, Budget ’05 has
clarified that MF agents have to pay service tax and such service tax
would be reduced by the MF concerned from the commission payable to the
agent. In other words, the agent would receive the net commission after
reducing service tax. The MF in turn would pay the tax on the agent’s
behalf to the exchequer. However, I do not know whether this practice
has been put into place as yet. Hence you are advised to ascertain
whether you have received net brokerage after the reduction of service
tax or the gross amount. If it is the latter, the onus is upon you to
pay the service tax. Salary of an NRI
Q: I was deputed to the UK by
my India employer in June 2004. They continued to pay my salary in India
during the deputation period, on which they deduct tax at source, and on
which I shall file my tax returns in India. In the UK, I have an
employer-employee relationship with the UK company. The UK company pays
me a living allowance from which I have some savings. I am returning to
India in April 2005 can I bring my pound sterling savings back with me
and hold them as foreign currency in an Indian bank account. Will there
be any tax issues with the money I bring back. (I do not have any
problems with the interest being taxed). Can I continue to hold the
money in a UK bank account? Would there be any benefits from this. —
Bhooshan A: A deputy does not leave India in any year for the purpose
of employment since he is already employed in India. Therefore, he gets
the status of an NRI if his stay in India during the financial year is
less than 60 days. Moreover, if the source of his salary is an Indian
company, the income is taxable in India, even if he is an NRI and even
if the salary is received abroad. On the other hand, if the income is
paid by an independent body separately incorporated abroad distinct from
the Indian company and the Indian company does not reimburse the foreign
entity for the emoluments paid, then such income is foreign income and
not taxable in the hands of an NRI. Also, 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. Any saving effected out of this allowance obtains
the colour and character of salary the taxability of which would have to
be determined as per the reasoning laid out in the previous para. Such
savings are taxable in India whether these are remitted to India or not.
Since you left India in June 2004, your status for the financial year
2004-05 is resident Indian and your taxability would be as per
above. If a person is taxed in India as well as his host country, there
is no need to worry. The Double Taxation Avoidance Agreement between the
two countries will protect him. Such agreements between India and other
countries are available on www.incometaxindia.gov.in The author may be
contacted at wonderlandconsultants@yahoo.com
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UTI Bank targets women with Smart Privilege Tribune News Service New
Delhi, April 23 Called Smart Privilege, the account would provide customers with a specially designed international debit card, which can be used at the bank’s 1606 ATMs across the country. The bank has endorsed Mona Singh, the lead character of the serial, Jassi Jaisi Koi Nahin, to promote the new saving product targeted especially at women. “Smart Privilege Account is especially designed keeping in mind the diverse needs of today’s woman,” UTI Bank Senior Vice-President (Retail Banking) Manju Srivatsa said at the launch here. Women can opt for free minor account and a zero balance account, which comes at no extra cost to the customer.
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Anil’s resignation was accepted, says IPCL Mumbai, April 23 In reply to BSE’s letter of yesterday seeking
clarification of media reports on Anil Ambani’s name missing from the
list of IPCL Board of Directors showed on the company’s website, the
company Deputy Company Secretary, Shashikala Rao, said, “the resignation
tendered by Mr Anil D. Ambani having been considered by the board, he
ceases to be on the board of the company.” — UNI
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New Delhi, April 23
