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7 CCI plants to be sold
Rs 8,017-cr revival package for IISCO PSEB
decision shocks furnace units
Alcohol to
power computer ITC mulls
two 7-star hotels No to Taj
catering bid for ‘Palace on Wheels’ |
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Deduction
admissible to handicapped persons
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7 CCI plants to be sold
New Delhi, September 4 The proposal of the CCI and the Department of Heavy Industry to sell the seven plants to raise funds for restructuring the company has received the nod of Board for Reconstruction of Public Enterprises (BRPE). The seven plants, which are not operating, will fetch Rs 617.76 crore. “For the biggest plant of CCI at Nayagaon in Madhya Pradesh having a capacity of 1.4 million tonnes the A.V. Birla Group company, Grasim, has shown interest,” sources said. The Dalmias have shown interest in taking over the Adilabad plant in Andhra Pradesh which has the capacity of four lakh tonnes, sources added. The expression of interest has also come for the plants at Akaltara and Mandhar in Chattisgarh, Kurkunta (Karnataka), Charkhi Dadri (Haryana) and a grinding unit in Delhi. After the nod of the BRPE, the proposal will go to the Cabinet for approval. Of the 10 plants of the CCI, only three were working and all of them were making operating profit. The BRPE has also approved the closure of Bharat Opthalmic Glass. The board was deeply divided on the issue of sale of seven plants of the CCI and the closure of Bharat Opthalmic Glass. The cost of closure of Bharat Opthalmic Glass will come to Rs 350 crore. The proposal to close down Bharat Opthalmic Glass was debated at a meeting of BRPE with members clearly divided on the issue. The revival proposal for the company needed just Rs 68 crore, of which Rs 65 crore would have been required for renewing the plant and machinery. According to the operating agency appointed by the Board for Industrial and Financial Reconstruction (BIFR), if the fresh funds were infused the company would have started making profit from the first year. The board, however, decided to go with the administrative ministry’s proposal to close down the company. With the closure the government will have to forego around Rs 300 crore in loans and accumulated interest. The voluntary retirement scheme would require another Rs 8 crore. Payment of other dues would take the total cost of closure to Rs 350
crore. — PTI
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Rs 8,017-cr revival package for IISCO
Durgapur, September 4 Speaking to newspersons at the Burnpur Club, Mr Paswan said: “The entire project will be completed within seven years.” The minister said: “SAIL would invest Rs 5,017 crore for the modernisation of the IISCO plant, and Rs 2,000 crore for the upgradation of its collieries at Ramnagar, Jitpur and Chasnala. The remaining Rs 1,000 crore will be invested for the development of its iron ore mines at Gua, Chinia and Monoharpur.” “SAIL has already invested Rs 25,000 crore for the modernisation of its other plants. By 2012, we would invest Rs 1 lakh crore, by which the
production will be upgraded from 35 million tonnes of steel to 65 million tonnes. Within 2020, for the betterment of SAIL steel plants, SAIL out of its own resources would invest Rs 2.5 lakh crore and then the production capacity will be 110 million tonnes,’’ he informed.
— UNI
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PSEB decision shocks furnace units Ludhiana, September 4 The decision affects not only more than 150 arc and furnace units but also industry like cycle and cycle parts manufacturers, auto ancillary units and other engineering goods manufacturing units that get raw material from this industry. Failing to tackle the power crisis, the PSEB decided to shut down these (high power consuming) units till further orders. So much was the panic over the decision late last evening that the price of ingot jumped from Rs 21,500 per tonne to Rs 22,500 per tonne within an hour. “We are shocked. We had already been suffering due to the ongoing power crisis, but we did not have the slightest of idea that the electricity board could take such a decision,” said Mr K.K.Garg, president, Induction Furnace Association of North India. The direct impact of the decision would have to be borne by arc and furnace units in Punjab, which record a daily production of 1,50,00 tonnes. Ingot is used in manufacturing rods, coils and by other industries as raw material. Since the industry was already suffering on account of a power crisis, the PSEB had ordered these units to operate on alternate days and later imposed a compulsory 48-hour weekly off. These units do not even have a buffer even for a few days. “Arc and furnace units refused to supply us any material as soon as these learnt of the PSEB decision. We had absolutely no idea that the government could take such a drastic measure. The industry would close down,” rued Mr Rajinder Jindal, president, Engineering Exporters Association of India. In terms of employment, the industry employs lakhs of labourers a majority of whom migrants from UP and Bihar. With the closure of a majority of the units in the state, the problem of unemployment would aggravate. Industrial associations will hold a meeting tomorrow. “We plan to meet Chief Minister Amarinder Singh. The further course of action would be decided tomorrow,” Mr Garg said.
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Alcohol to power computer
San Francisco (USA), September 4 The cell, produced by UltraCell, delivers 45 watts of power. The cell and methyl alcohol (also known as methanol) fuel together are half the weight of the currently used lithiu batteries. And unlike batteries, the fuel cells can be “recharged” without being plugged into the wall. Companies such as Toshiba have come up with their own fuel cells for laptops. But most of these products run directly on methanol, giving them a relatively low power output for their weight. UltraCell focussed instead on turning methanol into hydrogen inside the device, which lets them pump out twice as much power. The hydrogen fuel cell in the device is similar to others that are already on the market, with the added advantages of a better catalyst. This helps to keep down production of carbon monoxide, a by-product that can clog fuel cells, according to company officials. With a price tag in the tens of thousands of dollars, the US Army may be the only customer willing to pay for portable power just now. The company hopes the price will fall to hundreds of dollars as the technology improves.
— PTI
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ITC mulls two 7-star hotels
New Delhi, September 4 “We are working towards opening two seven-star luxury hotels in Bangalore and Chennai. The company is assessing a few sites for the projects,” ITC Chairman Y.C. Deveshwar said. Parrying a question on investment plans for the upcoming projects, Mr Deveshwar said: “We are aiming at building world-class luxury hotels and will shell out whatever is required to build such comfort
zones.” — PTI
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No to Taj catering bid for ‘Palace on Wheels’
Jaipur, September 4 The RTDC Board of Directors, which met here last night, found the sole bidding as “non-profit making and against the interest of the corporation,” Managing Director Rakesh Saini said. The bidder quoted a higher rate of weekly expenses which the board did not accept, Mr Saini said, adding RTDC used to bear Rs. 11,016 per week per passenger while Taj group’s bid crossed Rs 35,000 per week per passenger. Mr Saini, however, said there was neither any pressure from the RTDC employees union, which had gone to court over the issue, nor due to High Court’s stay on outsourcing. “RTDC just completed the bidding work and found it financially non-viable in the interest of the state government and employees,” he said. Mr Saini also ruled out inviting fresh bids saying there was no reason now to revive outsourcing or invite fresh bids as the winter season was about to begin.
— PTI
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by S.C. Vasudeva Deduction admissible to handicapped persons Q. I am 60 per cent handicapped and my annual income is Rs 1,28,219 and my GPF amount is Rs 7,210 and my LIC is Rs 12,588. Please give me my complete tax information and also tell me that according to u/s 80U, can I get a rebate of Rs 50,000 as I am 60 per cent handicapped. — Sukhminder Barhmi A. Section 80U of the Income-tax Act, 1961, (The Act) provides for that in computing the total income of an individual, being a resident, who, at any time during the previous year, is certified by the medical authority to be a person with disability, there shall be allowed a deduction of a sum of Rs.50, 000. This section further provides that in case an individual is a person with severe disability the deduction allowable shall be Rs.75,000 instead of Rs.50,000. This section defines "disability" as per the meaning assign to it in Clause (i) of Section 2 of the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995, and includes autism, cerebral palsy, multiple disabilities referred to in Clauses (a), (c) and (h) of Section 2 of the National Trust for welfare of persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999 (44 of 1999). A person with disability means a person referred to in Clause (t) of Section 2 of the aforesaid Act as well as in Clause (j) of Section 2 of the National Trust for welfare of persons with Autism, Cerebral Palsy, Multiple Retardation and Multiple Disability Act, 1999. The disability includes blindness, low-vision, leprosy, hearing impairment etc. A person with severe disability means a person with 80 per cent or more or one or more disability, which have been mentioned in the relevant Act referred herein above. The facts indicated by you in the query do not provide sufficient details with regard to your disability and whether the same is covered within the prescribed list. In case you are so covered, a deduction to the extent as the case may be, would be allowable as a deduction against your total income in terms of the aforesaid section of the Act. EMI on loan Q: I have taken a loan from XYZ company – a personal loan at 8 per cent and am paying EMI of Rs1,500, where Rs 1,200 is principal part and Rs 300 is the interest part for the last few months. Now suddenly the company has asked me to pay EMI of Rs.1,530 as Rs.1,200 is principal amount and Rs.300 is the interest amount and Rs.30 is 10 per cent service tax on interest part. This will make my EMI Rs1,530. If I pay this then the total outcome will make my loan costly than 8 per cent. Kindly suggest, whether the XYZ Co. is justifiable on charging this amount on my loan at the end I am to pay extra for my loan. — Sumit Narang A. XYZ Company is required to pay service tax on financial services rendered to a client. It being a statutory levy, XYZ Company can pass on this statutory levy to the client. Tax on pension Q. I took premature retirement from Punjab Government service and I receive regular pension from Punjab Government, which is directly deposited in my bank account. At present, I am living outside India. The bank deducts whatever tax is due on my pension each year. Do I really need to file tax return each year and, if so, then please guide how should I do it? — Narinder A: According to the new provisions of the Act, which have been made applicable w.e.f. June 1, 1999, you are required to furnish the return of your income if your total income exceeds the maximum amount chargeable to tax in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed. Accordingly, even if the tax is being deducted at source and taxable income is more than the maximum amount provided for in the Finance Act 2005, you will have to file the return of income under the provisions of the Act. Tax liability Q. I am a bank employee having PAN No. and filing the return of tax for the past many years. Tax is being deducted by my employer from my salary. I was allotted one residential plot in one of the urban estates of HUDA in the year 1986. However, the possession of the same was not given to me and so many others as the land was under litigation. In the year 1996, an alternative plot was offered in one of the other sectors but at a higher price than the price on which original plot was allotted. I approached the court to direct HUDA to charge the same old rate. The hon’ble State Commission Haryana by an order in the year 2001 directed HUDA authorities to give possession of the said plot with the same old rate and also pay compensation on account of delay in giving the possession in the form and interest @12 per cent p.a. on the amount deposited after two years from the original date of allotment of 1986. By that time entire cost amounting to Rs 60,000 had already been paid to me. HUDA did not comply the orders of the court and contempt application was filed. It was only in November 2003 that HUDA offered the possession. Actual paper possession was given in December 2003 and interest Rs 34,000 as per the direction of the court was also given. At the same time, HUDA demanded Rs 40,000 as enhancement to be payable in half yearly instalments of Rs 8,000 plus interest @ 15%. I have already paid 4 instalments of Rs 8,000 each with interest. Last instalment along with the interest will fall due in November 2005. I, nor my spouse (since expired) and my dependant children have never owned any residential plot, flat or house in our name anywhere in India. Total price of plot, including enhancement of Rs 40,000 comes to Rs 1 lakh. The expected sale price is Rs 10 lakh. Now I want to settle in Chandigarh and accordingly want to purchase one residential plot, house or flat at Chandigarh; Mohali or Panchkula through sale of the HUDA plot and rest by raising loan from the bank. It will cost Rs 20 lakh. Please clarify the following:- i) Whether any tax liability will arise on the profit on sale of the plot (10 lakh - 1 lakh) i.e. Rs 9 lakh. I understand that the profit will not be taxable in case the entire sale proceeds are utilised towards the cost of new house to be acquired and in case of purchase of plot if it is built within 2 years, as the cost of the new house will be more than the capital gain. ii) Whether profit of Rs 9 lakh will be treated as long-term or short-term capital gain and what will be the treatment in both cases for the purpose of computation of tax, if any. iii) What treatment will be given to Rs 34,000 received in 2003-04 as interest compensation as per the court order. Can this amount be set off and deducted from the cost of the plot allotted by HUDA at the time of sale or otherwise. I understand that the amount of compensation allowed by the court on account of delay in giving the possession will not be taxable. Even, HUDA also insisted to adjust the compensation with the enhancement but I opted otherwise. iv) Which date will be reckoned as date of acquisition of the plot allotted by HUDA viz. date of original allotment i.e. February 1986, date of offer of alternative plot i.e. September 1996, date of the court order directing HUDA to give possession i.e. May 2001, date of offer of possession by HUDA i.e. November 2003 or date of actual paper possession i.e. December 2003 for the purpose of computation of capital gain. I have been told by a consultant that in such cases the date of the order of the court can be treated as date of possession/acquisition. — S.C. Jindal A. The answers to your queries are as under: (a) In my opinion, the date of possession of plot being December 2003, the profit of Rs 9 lakh likely to be earned on sale of plot would be taxable as a short-term capital gain. (b) The long-term capital gain is taxable at a concessional rate of 20 per cent. The short term capital gain is taxable at the normal slab rate applicable to an assessee. (c) The interest on compensation received as a consequence of court order would be taxable as income from other sources in the year of receipt. Readers are welcome to send questions
for tax advice. These should be brief, to the point and not exceed
100-150 words. The letters should be sent to Tax Advice C/o The
Tribune, Sector 29, Chandigarh-160020 or emailed to: |
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