New Delhi, July 15
In a move that may cripple the nation's oil and gas production, the shipping ministry has issued new norms for operation of vessels in the Indian waters that will force leading operators like ONGC and Reliance Industries to shut offshore operations.

DG Shipping had on May 15 barred operations of all categories of vessels that are more than 25 years old. The move that probably was aimed safety of operations of cargo vessels has, unintendedly, hit oil industry hard.

"Our offshore oil and gas operations will collapse if these norms are implemented," ONGC chairman and managing director R.S. Sharma said.

ONGC has over 100 such vessels supporting oil and gas production from fields like Mumbai High and aiding exploration in new prospects. Similarly, Reliance has 40-plus vessels that are helping it bring to production its largest gas field in Krishna Godavari basin.— PTI

Chandigarh, July 15
As the US government turns the heat on pharma major, Ranbaxy for allegedly forging documents and selling sub-standard products, the latter has maintained that the company is clean.

“Mistakes do happen, even in the best of companies. We are not claiming that we are the best company where nothing can go wrong. When we realised the mistake, like a responsible corporate we voluntarily recalled 73 million tablets of the epilepsy drug gabapentin,” said Shivinder M. Singh, director of Ranbaxy, in an interview to The Tribune here today.

Though he was reluctant to talk about the controversial case filed by the US Food and Drug Administration (USFDA) against Ranbaxy, he said the company had apologised for the mistake. “We are a clean company, with nothing to hide. By voluntarily recalling the drug, we had suffered losses worth millions of dollars,” he added.

It may be noted that the USFDA has sought legal action against Ranbaxy on charges that the company used active pharmaceutical ingredients (API) from unapproved sources. The company has also been accused of blending the unapproved API with the approved API, and used less than approved API in drugs manufactured at its Paonta Sahib facility. This led to sale of sub potent, super potent and adulterated medicines in the USA.

Talking about the recent deal with Japanese pharma major Daichii Sonakayo, he said while Malvinder M Singh would remain as CEO, they had not yet taken a call as to who would be taken on the board of directors. The original promoters of the company have been allowed to have four members on the board of directors.

Shivinder, who is the CEO and managing director of Fortis, said the group was in an expansion mode. “We already have 14 hospitals and eight satellite centers, and are looking towards a growth of 40 hospitals in the next two years. Three hospitals at Delhi, Gurgaon and Mumbai are being rolled out this year itself. The hospital at Gurgaon will have 1,000 beds and will be a multi-super speciality hospital, which will be one of the best healthcare institutions in the world,” he added. 

New Delhi, July 15
Deteriorating fiscal position of the Union Government on account of increasing oil and fertiliser subsidy bill has prompted global credit rating agency Fitch to downgrade India's credit outlook from stable to negative today.

Although the Fitch revised the outlook on Long-term Local Currency Issuer Default Rating (IDR) from stable to negative, it has retained the investment grade rating at BBB-, which indicates low credit risk.

"The revision to the local currency outlook is based on the considerable deterioration in the Central government's fiscal position in 2008-09, combined with noticeable increase in government debt issuance to finance subsidies not captured in the Budget," said James McCormack, Asia Head of Sovereign Rating, Fitch.

The downgrade by Fitch is one of the main reasons for all-round selling in the stock markets. The benchmark equity index Sensex was down over 547 points and was ruling at around 12,782 points.

Another global rating agency Standard and Poor's last week had said it might downgrade India's sovereign ratings, if the country's rising inflation, widening fiscal deficit and political instability continues in the longer term.

Fitch further pointed out that inflation has continued to accelerate despite steps taken by the RBI to tighten monetary policy.

It further said with inflation rate nearing 12 per cent, there could be further tightening of monetary policy in the days ahead.

Fitch has also forecast that India's economic growth rate will moderate to 7.7 per cent in 2008-09 from nine per cent last fiscal. — PTI

New Delhi, July 15
Soaring inflation and market volatility notwithstanding, Indian investors have emerged most optimistic in Asia and many of them believe the economy has improved in the second quarter of 2008, says a survey.

According to a survey conducted by Dutch financial services major ING, 76 per cent of Indian investors believe the economy would improve in the third quarter while 71 per cent felt that economy had improved in the second quarter.

"Despite market volatilities, rising oil prices and inflation, the ING Investor Dashboard Sentiment Index for India continues to reflect highest level of investor optimism across Asia. ...a lot more investors claim that the economy has improved in the last quarter," the survey conducted in association with research and analysis provider TNS said.

India's investor sentiment slipped three per cent to 163 for the second quarter from the first quarter of 2008.

In Asia Pacific region, India is followed by Hong Kong (123) and China (117) at the 2nd and 3rd places, respectively.

About 72 per cent investors expect return on investment to increase in Q3 compared to 63 per cent who think the return had increased in Q2. Nearly 68 per cent respondents in India expect their personal financial situation to improve in Q3.

"Overall investor sentiment in Asia falls 13 per cent for Q2 from Q1 in 2008 as global economic slowdown continues and regional political developments weigh on investors," it said.

"...the one thing going for India is that absolute growth rate of 7-8 per cent is still a great number, compared to the global average of about 4 per cent,...we may be slowing down slightly, economy is still expected to remain healthy," ING Investment Management India MD and CEO Vineet K Vohra said. — PTI 

New Delhi, July 15
Kingfisher Airlines has lost the race to acquire low-cost carrier SpiceJet.

Promoters of Spicejet, UK-based Kansagra family and Gulf-based investor Istithmar on Tuesday said US-based investor Wilbur Ross' offer to invest $80 million (about Rs 345 crore) had been accepted.

"SpiceJet has accepted an offer in principle that will make available approximately Rs 345 crore to SpiceJet. The offer was approved by the board of directors of SpiceJet today. The transaction is subject to definitive documentation and approvals, if any," a joint statement by SpiceJet and WL Ross & Co said.

Kingfisher CEO Vijay Mallya had reportedly been talking to Istithmar and Kansagra family who together hold roughly 25 per cent stake in SpiceJet.

Analysts say fresh capital infusion will help the carrier to gain an edge in terms of operational efficiency. The airlines, reeling under onslaught of rising ATF prices, needs funds for working capital. However, they add that it would be a short-term breather for the airlines.

Regarding the merger, SpiceJet board member Bhulo Kansagra said, “We are delighted to have WL Ross as an investor in SpiceJet. With this investment, we have no doubt that SpiceJet will fulfil its promise of emerging as India's leading airline". “We believe in the long-term validity of the low-cost airline model in India and that fuel prices eventually will stabilise,” said WL Ross & Co chairman and CEO Wilbur L Ross. Despite an abysmally low market, the announcement saw a spur in shares of SpiceJet on the Bombay Stock Exchange.

The funds provided by Ross comprise more than half of SpiceJet's equity base of around Rs 600 crore. Spicejet board member Ajay Singh said investment details would be made public only after final documentation is completed by the next fortnight. Terming it a “significant investment for SpiceJet to retain its low-cost model,” Singh said it would help strengthen SpiceJet and help it in expansion plans.

According to reports, WL Ross is expected to acquire foreign currency convertible bonds held by Goldman Sachs and Istithmar. The bonds will turn convertible in 2010 when WL Ross becomes stakeholder.

Ross and managing director & CEO of WL Ross India Ranjeet Nabha are expected to join the board of SpiceJet. 

Mumbai, July 15
With less than a fortnight remaining till the last date for filing income tax returns, tax payers and chartered accountants alike are confused as to the procedures that need to be adopted. Should attachments like TDS (tax deduction at source) certificates be attached? Should one opt for the services of a chartered accountant or will the services of a tax preparer be sufficient? Is e-filing of income tax returns safe?

As of now, chartered accountants and income tax officials are clueless even though this is the second year that the ITR forms unveiled by the department will be in force. These forms, officials say, were introduced with the objective of reducing cumbersome paperwork while allowing for every financial detail of the assessee to be captured without external attachments being included. However, this scheme did not work last year and assessees whose taxes deducted at source were in excess are still waiting for refunds.

"Since assessees did not submit TDS certificates it has become difficult to collate actual refunds due to them," admitted a senior income tax official here. Often assessing officers are confused by minor discrepancies in information provided in the income tax returns and data submitted by the deductor.

This year, officials say, the Income Tax Department has asked assessees to submit attachments like TDS certificates in order to obtain refunds.

However, a circular issued by the CBDT which states that taxpayers assessed as employees need not submit TDS certificates if the TDS claim by the employer is less than Rs 5 lakh or if the refund is less than Rs 25,000 has caused some confusion. "Tax payers who go by this circular will have problems getting refunds this year as well," says Mohit Pandya, a city-based chartered accountant.

CAs are now advising tax payers to attach TDS certificates even if the amount deducted runs into a few thousand rupees so as to avoid hasslles in future.

The much vaunted tax-preparers scheme unveiled by the Income Tax Department has flopped as well with many taxpayers complaining that their returns were incorrectly filled. According to sources here, taxpayers whose returns were rejected by the Income Tax officials last year had to file fresh return via chartered accountants thereby incurring extra expenditure.

Consequently, e-filing or paperless income tax returns has also failed. Taxpayers will have to spend money on obtaining digital signatures to file e-returns after which they would have to submit duplicate copies of their returns to the Income Tax Department. Since most people opt for the services of a CA in order to avoid the rush at the IT offices, e-filing has not caught on with individual taxpayers.

Even as income taxpayers rush to CAs to complete the last-minute formalities before the deadline, officials expect the IT Department to extend the last date for filing returns this year as well.

New Delhi, July 15
The panel constituted by the Department of Telecom (DoT) to recommend methodology, including a suitable auction mechanism for the 2G spectrum, may seek at least Rs 1,600 crore each, as one-time payment for having spectrum beyond the stipulated 6.2 Mhz in the spectrum from mobile operators.

The panel headed by DoT's additional secretary Subodh Kumar, held its first meeting with industry representatives to work out the modalities whereby operators may be asked to pay on Mhz basis for spectrum held beyond what was promised in the licence agreement.

2G Spectrum pricing and allocation has seen considerable controversy between DoT and the TRAI, besides the finance ministry and operators and finally the Central Vigilance Commission (CVC) also seeking answers on the methodology being adopted for the allocation.

The CVC had questioned DoT for allocating spectrum beyond 6.2 MHz to GSM players. Besides, Member of Parliament Amar Singh had also written to the Prime Minister seeking a fee on all operators who had spectrum beyond what was mentioned in the licence.

Incidentally, the main task of the panel is to work out a practical, revenue-generating and amicable solution on these two issues.

According to reports, while the GSM licence does not mention spectrum beyond 6.2 Mhz, some of the operators, including Bharti Airtel, have been given up to 12 Mhz based on their subscriber numbers, hence raising of the eyebrows in various sections.

The new formula being suggested by DoT will do away with the process of allocating spectrum without any upfront fee. This means that an existing operator, such as Bharti, will have to pay for the additional 5.8 Mhz that it already holds in some circles.

DoT is of the opinion that for a pan-India operator, the circle fee fixed at Rs 357 crore per MHz should be inflated by a multiple of 3.5 times reflecting the growth in revenue per MHz between 2003 and 2008.

The other options being discussed are to ask the operators to pay a flat fee of Rs 1,600 crore based on the price arrived at in 2001 during the fourth cellular bidding process or to ask the operators for Rs 375 crore/Mhz, in which case they will pay according to the quantum of spectrum they hold in each circle.

New Delhi, July 15
Stock broker Ketan Parekh, involved in the Rs 888-crore Madhavpura Mercantile Co-operative Bank scam, is likely to be arrested with the Supreme Court today refusing to give him more time to deposit a Rs 26-crore instalment, a pre-condition set by the court for him to continue on bail.

A Bench headed by Justice Ashok Bhan today dismissed his application seeking extension of time to pay the instalment, which was due on May 1.

Madhavpura Mercantile Co-operative Bank counsel Mahesh Agarwal said the effect of today's order is that the bail granted to Parekh stands automatically cancelled and the CBI can arrest him. The bank's plea seeking cancellation of Parekh's bail is scheduled to be taken up on August 27.

Apart from defaulting on the payment of May 1 instalment, the broker had failed to meet the deadlines for paying the dues to the Bank earlier as well.

The apex court on May 17, 2007 had granted bail to Parekh on the condition that he would pay Rs 396 crore to the bank in instalments of Rs 26 crore each.

It had further ordered that in case of any default in payment of instalments by Parekh, his bail would be deemed to have been cancelled and he would have to surrender. — PTI 

BRIEFLY

Rupee tumbles by 31 paise
Mumbai: The Indian rupee lost 31 paise and closed above the crucial 43-level against the greenback amidst downgrading of the local currency by global rating agency Fitch and a collapse in stock markets even as the dollar softened in overseas markets. At the Interbank Foreign Exchange (Forex) market, the Indian rupee closed at 43.23/24 against a dollar, down by 31 paise. The local currency opened weak at 43.02/04 against yesterday's close of 42.92/93 and dropped further sharply to a low of 43.3050. — PTI

Lafarge to invest $1 b in India
Mumbai: French cement-maker, Lafarge plans to invest $1 billion over five years to expand its cement capacity in India to around 20 million tonnes. Lafarge, which bought top engineering and construction firm Larsen & Toubro's concrete unit for $ 350 million in May, plans to build three plants with a capacity of 2.5 million tonnes each, the report said. — UNI

Walden International plan
MUMBAI: Global venture capital firm Walden International, plans to infuse $ 100-150 million into the country over the next one-and-half years, a top company official said: "We will be investing over $ 100-150-million in India to enhance our investment portfolio over the next 12-18 months," Walden International’s newly-appointed Managing Director, Rajesh Subramaniam, told reporters here. — PTI

Gold glitters at Rs 13,650
New Delhi: Gold prices shot up by Rs 180 on Tuesday to set an all-time record high of Rs 13,650 per 10 gram in the national capital on firming global trend amid bearish stock market. The previous record of the metal was at Rs 13,560 per 10 gram on March 17. — PTI

Sun extends open offer
NEW DELHI: Five days after the Israel-based Taro Pharmaceutical termed the open offer launched by Sun Pharmaceuticals as 'sham', the Mumbai-based firm on Tuesday extended the expiry date of the open offer to September 2. Sun Pharma said its subsidiary, Alkalodia Chemical Exclusive Group has extended the expiry date of the Tender Offer for purchase of all outstanding ordinary shares of Taro Pharmaceuticals. The offer was previously scheduled to expire on Monday, July 28, 2008. — PTI

Hyundai 'i20' by year-end
Chennai: Country's second largest car maker Hyundai on Tuesday said it would launch a new small car 'i20' by the end of this year, which will complete the company's product portfolio in the compact car segment. Besides, the company today launched a new 'i10', powered by a 1.2 litre Kappa engine, priced between Rs 3.99-5.43 lakh. — PTI