New Delhi, August 21
The government today announced to sell all its holding in Maruti Udyog Limited to raise more than Rs 2,500 crore.

“We have written to the Finance Ministry to sell the 10.24 per cent stake that the government has in Maruti. Now it is up to them to take the call,” Heavy Industries Minister Santosh Mohan Dev said here today.

The government stake in the company is held by Ministry of Heavy Industry.

The minister said the Finance Ministry was likely to set up an inter-ministerial-group after the end of ongoing parliamentary session to decide the route of selling a stake in Maruti, which could be through financial institutions, public offer through a strategic partner.

Based on the current market price of the scrip on the stock exchanges, the government is likely to raise over Rs 2,500 crore. As all disinvestment in public sector companies is off for now, the sale of shares in erstwhile PSU Maruti will offer much-needed resources to the government.

Last year the government had sold 8 per cent shares in Maruti for more than Rs 1,567 crore to public sector financial institutions.

“I am no more on the Board of Maruti and the government will sell its remaining stake in the company to which the Left parties also have no objection,” said the minister.

Mr Dev also said the Prime Minister had agreed in principle to release Rs 138 crore for liquidating the salaries and other statutory dues of PSUs under the Ministry of Heavy Industries. This Rs 138 crore was part of the Rs-350 crore package for the same purpose for all PSUs.

Mr Dev said the government would pump in additional capital in tractor unit of HMT, which has started making profits. “We have already sold its surplus land in Bangalore for Rs 200 crore, and hope to raise additional resources by selling surplus land with other companies.”

For the revival of Bharat Heavy Plates and Vessels (BHPV) and Bharat Pumps and Compressors Limited (BPCL,) other PSUs had been roped in.

The minister said the ONGC had completed the due diligence for taking over lubricant company Tide Water Oil, which is an Andrew Yule Subsidiary.

For supporting small and medium auto component units, the government was setting up an Institute of Forging. The government would give Rs 22 crore for the institute that would be ready in next 12 months.

New Delhi, August 21
Despite strong opposition from the legal community, the government is mooting to open the legal profession to foreign players, especially to tap the $265 billion global legal outsourcing market.

“I know that the Bar Council is not ready for the opening of the legal profession to foreign legal firms. But young lawyers are looking for an opportunity through the opening of the profession to foreign legal firms,” said Union Law Minister H.R.Bhardwaj here today.

The government was working towards opening the sector in a phased manner by preparing the domestic legal fraternity, keeping in view the changing global scenario.

Talking to the reporters on the sidelines of a conference “Partnership between Business and Law” the minister lamented that Indian legal fraternity was not keeping pace with the global requirements.

“I have received over 200 delegates of foreign companies during the past two years, and surprisingly, all accompanied by foreign solicitors. Indian law firms should get the message,” he said.

Earlier, addressing the conference Reliance Group Chairman Mukesh Ambani said, “Indian legal professionals could earn up to $20 billion in the next few years from the expanding global legal outsourcing market. Presently, out of the estimated $ 265 billion global market, 65 per cent could be outsourced,” he said.

The industry and law firms should work together, he said, to tap this market, besides working jointly in new areas of patent protection, cyber crimes and risk management.

Chandigarh, August 21
Fixed deposits in banks will now qualify for deductions under Section 80C of the Income Tax Act. The Central Board of Direct Taxes (CBDT) has issued a notification in this regard, which will be effective from the assessment year 2007-08.

The scheme is aimed to benefit senior citizens at large and was announced in this year's Budget. However, a notification by the CBDT has been issued only recently. Under this, the overall quantum of investment in the term deposit available for deduction, cannot exceed Rs 1 lakh (for a lock-in period of five years, though it can be encashed before maturity). Also, Rs 1 lakh is the overall deduction available for all items under Section 80C.

The fixed deposits can be placed as a single or joint account, though in case of a joint account, the deduction under Section 80C will be given only to the first holder of the deposit. The fixed deposits so placed in the scheme cannot be pledged with any other agency or offered as a security for any purpose.

The scheme provides for nomination replacement of lost deposit receipt. "The nomination facility can be affected at the time of deposit, or at any time before maturity through an application on a prescribed format. The interest from the fixed deposits is taxable in the hands of the depositors," informed a senior official in the Income Tax Department.

The State Bank of India and its associate banks, besides scheduled banks qualify to offer this benefit. A number of cooperative banks, even if they offer higher rates of interest, do not qualify to offer this benefit. 

Mumbai, August 21
UTV has announced an international co-production with leading Hollywood studios for a total investment of $37 million, touted as one of the largest commitment by any South Asian media major.

Close on the heels of its tie-up with Walt Disney, UTV’s new initiatives are billed as the largest co-production deal outside South Asia.

UTV will partner with Fox Searchlight on Chris Rock’s movie “I think I love My Wife”. It will also join hands with Hollywood actor Will Smith’s Overbrook and Sony Pictures Entertainment on two movie deals, including one live action English feature and a CG (computer graphics) animation film, a UTV release issued here today said.

UTV and Fox Searchlight co-production’s “I think I love My Wife”, starring Chris Rock, was announced by UTV’s CEO Ronnie Screwvala and Fox Searchlight CEO Peter Rice in Los Angeles on August 18.

The principal photography of the film has been completed in New York and Fox Searchlight plans to release it in the US on February 9, next year. The $14-million production is UTV’s second venture with Fox after “The Namesake”, directed by Mira Nair, which will be released in March, next year.

The second deal UTV announced is a $30-million co-production agreement with actor-producer Will Smith and his production company Overbrook Entertainment and Sony Pictures Entertainment (SPE), for films to be created and distributed worldwide. This was announced in New York on August 19 by Mr Screwvala and Smith.

“India is one of the most remarkable places on earth and its motion picture industry has always fascinated me,” Smith said.

As a result of the co-production agreement, UTV and Overbrook will develop films that will have a global reach and appeal. The first two projects will be a live-action film valued at $10 million and a CG animated motion picture at $20 million.

According to the terms of the agreement, while UTV and Overbrook will co-produce the movies, SPE will distribute the movies worldwide, excluding India. — UNI

New Delhi, August 21
In a major relief to operators and subscribers, the TRAI today decided to maintain the status quo position on the interconnection usage charges (IUC) for short message service (SMS) on mobile phones.

At the same time, it said the charges of premium SMS were on higher side and bore no relationship with the cost and nature of services rendered and said: “It is hoped that the telecom operators would voluntarily reduce the charges of premium SMS service and the TRAI henceforth would closely monitor the trends”.

The TRAI has maintained forbearance on IUC for SMS, the regulator said releasing its analysis and decision on the IUC for SMS.

As per the prevailing IUC regulation, termination and carriage charges for SMS has not been specified by the TRAI and are forborne.

To address some of the representations from service providers, the TRAI had issued a consultation paper on the issue of IUC charges for SMS.

The main issues raised were IUC for SMS and premium rate SMS. — PTI

New Delhi, August 21
The ONGC plans to invest over Rs 130,000 crore during XIth Plan Period (2007-12) in domestic oil and gas hunt, overseas acquisition and expansion of Mangalore refinery.

ONGC’s domestic oil and gas exploration and production spending will rise by 56 per cent to more than Rs 80,000 crore in 2007-12 as against Rs 51,299 crore expenditure in the Xth Plan Period (2002-07), Chairman and Managing Director R.S. Sharma said.

On overseas oil and gas properties acquisition, about Rs 50,000 crore has been earmarked for the XIth Plan as opposed to Rs 13,500 crore in the current plan period.

Besides, the company would also invest Rs 8,000 crore in expanding Mangalore Refinery and Petrochemical Ltd capacity to 15 million tonnes per annum.

Mr Sharma said deepwater and frontier basins were thrust areas for ONGC’s domestic E&P. The focus areas would also include technology solutions for improving recovery factor, expeditious development of new as well as marginal fields, refurbishment of surface facilities and technology induction.

The improved oil recovery/enhanced oil recovery (IOR/EOR) projects in 15 major fields had arrested the 7 per cent decline in production from the matured fields and reversed the trend.

Eight IOR/EOR projects worth Rs 1,703 crore have been completed and another 10 projects (Rs 12,138 crore) were under implementation, Mr Sharma said, adding that envisaged oil gain through the IOR/EOR projects was 110 million tonnes by 2020. — PTI

New Delhi, August 21
The government said today the tax revenue of VAT- implementing states had shown an increase of 27.1 per cent during the first quarter of this fiscal year-on-year.

This is quite remarkable and indicates that the VAT system has started stabilising and yielding the desired results, Adviser to the Union Finance Minister Parthasarathi Shome said.

The tax revenue of the VAT- implementing states showed around a 13.8 per cent increase in 2005-06 over tax revenue of 2004-05, which was higher than the compound annual growth rate of sales tax revenues of these states for the past five years, he said in statement here.

Pointing out that the Centre had a role of facilitator in the VAT scheme of things, Mr Shome said the Empowered Committee of state Finance Ministers was in the process of persuading the remaining states and union territories to introduce VAT.

Only UP, Tamil Nadu and Pondicherry had not implemented VAT so far. However, Tamil Nadu had said it would implement VAT from January 1, 2007.

The Empowered Committee is slated to meet on August 24 in New Delhi.

Mr Shome also said the issue of compensating states for revenue loss on account of proposed cut in the Central Sales tax was presently being deliberated upon.

As a compensation package, the Empowered Committee had asked the Centre to authorise the states to impose VAT on imports, increase their share in devolution of the service tax from 30.5 per cent to 50 per cent, bring in 68 services under the state tax net and allow them to impose VAT on sugar, textiles and tobacco. — PTI 

New Delhi, August 21
India Post has kicked off a new Speed Post tariff under ‘One India, One Rate’ scheme, official sources said here today. There would be a new weight slab of up to 50 grams under this scheme. ‘’Speed Post tariff under this scheme will be Rs 25 for the first weight slab of ‘up to 50 grams’, irrespective of the distance. However, in respect of ‘local’, the current Speed Post rate structure will continue,’’ the sources said. The new tariff of Rs 25 for the weight slab of upto 50 grams (other than local articles) will be inclusive of service tax and educational cess, irrespective of the distance involved.—UNI