The Tribune, Chandigarh, India

	ONGC asks SGI: Who pays royalty if Vedanta buys Cairn stake? New Delhi, October 3 State-run Oil and Natural Gas Corporation (ONGC) has sought Solicitor General of India’s opinion on whether it will be liable to shoulder the entire royalty burden on crude output from the Rajasthan oilfields, even after Vedanta Resources buys Cairn Energy's stake. The prolific Rajasthan oilfield is economically unviable for ONGC, as it not only has to pay royalty on its 30 per cent share, but also on Cairn India's 70 per cent stake. ONGC wants to know if dispensation will legally continue when Cairn is exiting the project after making a huge profit, sources in-the-know of the development said. In the 1990s, the government had exempted companies investing in the then nascent oil and gas exploration business from payment of statutory levies like royalty and oil development cess. This liability was put on the licensee of the field, a state-owned firm. ONGC is the licensee for the Rajasthan block. Sources said ONGC, in its query to the SGI, wanted to know the legal position in the event that a company is entering a discovered and producing field and no exploration risk is involved, which was the premise on which the incentive was given in the 1990s. The exemption from statutory levies was to make up for the risk that a company was taking by investing in a nation that is not known to be rich in hydrocarbons. However, Vedanta, which is buying UK-based Cairn Energy's majority stake in Cairn India for up to $8.48 billion, is not taking any such risk, they said. ONGC wants Vedanta to pay royalty and cess on the 70 per cent crude oil from the Rajasthan block that will accrue to it. Cairn India operates the Mangala field, the largest of the 25 oil and gas discoveries in the Rajasthan block. The block currently produces 125,000 barrels per day and at peak output of 240,000 bpd, it will account for one-fifth of the nation's domestic oil production. A royalty of 20 per cent has to be paid to the government on the price that Rajasthan crude is sold at. At an oil price of $40 a barrel, the royalty in case of an average output of 6 million tonnes a year works out to $352 million (Rs 1,760 crore). ONGC has to bear 30 per cent of the $2.4 billion cost for developing the fields, as well as pay more than three times its share of $105 million royalty. Cairn wants ONGC to also pay its share of the Rs 2,500 per tonne cess levied on crude oil, which would amount to a burden of Rs 1,500 crore for ONGC annually. — PTI
	Maruti Suzuki exports cross 8 lakh units New Delhi, October 3 Twenty three years after it made its first overseas shipment of 500 vehicles, Maruti Suzuki India's (MSI) now exports more than 8 lakh units. A quarter the overseas sales is accounted for by flagship model, A-Star. MSI's exports business began on a humble note, with the shipment of just 500 units to Hungary initially. However, the list of countries has since been expanded and so has the number of units. The Netherlands tops the list, accounting for 84,727 units out of total exports, while Algeria and Italy have imported 75,060 units and 54,273 units, respectively. UK and Chile stood at 4th and 5th position in the list of top buying nations, accounting for 50,916 units and 49,299 units, respectively. "Amongst all the regions, in EU we exported 1,14,000 A-Stars, while we exported 13,500 to non-EU countries," he added. The A-Star was launched in European markets in February 2009, and the model is now being exported to about 100 countries. In the current fiscal, the company has shipped about 76,000 vehicles so far. Of this, about 54,000 units are A-Stars. "Of this, A-Star exports to Europe are 39,000 and around 15,000 are exported to non-Europe," the spokesperson said. Japanese car-maker Nissan sells the A-Star in Europe as Pixo under a contract manufacturing agreement with MSI's parent company, Suzuki. MSI also markets the A-Star as the Alto in Europe, while in other regions, it is sold as Celerio. — PTI
	Tax Advice Section 234B, 234C of I-T Act applicable for advance tax by SC Vasudeva Q. I want to know if interest under Section 234B, 234-C, is applicable on a salaried employee. If yes, then how we calculate the interest. While we calculate the 234-C interest then which amount being taken for calculation of interest 30%, 60%, 100%:- 1. Gross Tax Payable 2. Gross Tax Payable - TDS = Net Tax Payable — Mahesh A. The provisions of Section 234B and Section 234C of the Income-tax Act, 1961, (the Act) are applicable in case an assessee is liable to pay advance tax. For salaried employees, tax is deducted at source under Section 192 of the Act. If there is default in payment of such a tax, interest is chargeable under Section 201 of the Act from the liable to deduct tax at source. In case, tax at source is not being deducted in your case, then the normal provisions applicable to other income would apply. In such a case, advance tax payable @ 30%, 60% and 100% of total tax payable will be computed in respect of the total income, including salary income. Time limit for I-T demand Q. I have received a notice from Income Tax department asking me to deposit Rs 5,670.00, due against 2002-03. The return was filed timely and I was posted at a different station. During transfer of household luggage, some of my old files were damaged including that my I-T return copies. Is not there any time limit for I-T department on raising a query or asking for an income tax deposit for a previous year?Please clarify. — Dr DP Singh A. The demand of Rs 5,670 for the assessment year 2003-04 (financial year 2002-03) would have been raised by March 31, 2006. I am sure the tax department must have taken care to complete the assessment before the said date. You may not have received the papers concerning the tax assessment on account of frequent transfers. It would therefore be advisable to approach the tax department and get a copy of the assessment order which will indicate the reasons for raising the demand of Rs 5,670. In case you do not agree with the assessment as framed, you may take up the matter in an appeal with the Commissioner of Income-tax (Appeals). You will have to file a petition with the Commissioner of Income-tax (Appeals) for condoning the delay explaining the reasons of such delay in filing the appeal. This is because an appeal is required to be filed within thirty days of the receipt of the assessment order. If the reasonsare genuine, the Commissioner of Income-tax (Appeals) should be sympathetic and take up the hearing of the appeal by condoning the delay. Once the demand is raised within the prescribed time, the same can be recovered at any time. No such provision exists demand gets time-barred. Delay in filing Q. I am into export business in tie-up with a manufacturing company in Ludhiana. The manufacturing company deducts TDS at the time of releasing my commission for which they send Form 16A every year. But, this year they are breaching the terms and conditions of my business agreement with them due to slow market. The company has not sent my Form 16A for the TDS deducted during the period from April 1, 2009 to March 31, 2010 till date in spite of my repeated reminders due to which I was unable to file my return. Suggest what should I do and where should I complain. — Naresh Kumar A. You can file a complaint with the Commissioner of Income Tax with a copy to the Assessing Officer having jurisdiction over the manufacturing company that tax deduction certificate has not been issued to you though the amount of tax at source has been deducted by the manufacturing company. The company would be liable to pay penalty at Rs 100 for every day for such days. Medical treatment Q. I have undergone Kidney Transplant surgery. My monthly expenses on medicines are about Rs 15,000 a month. My government department reimburses the expenses which are allowed by CMO every month. Normally CMO clears the bill up to 80% of the total monthly expenses. I want to know whether any Tax benefit is available for such patients in general and/or on the balance of about 20% which is not allowed for reimbursement. I may add that all the drugs I am taking are life saving drugs and a certificate to this effect is provided by the government hospital from where I have undergone Transplant surgery. — Naveen A. You will be entitled to claim a deduction of an amount actually paid by you for the treatment in the nature of chronic renal failure or a sum of Rs 40,000 whichever is less, in respect of the previous year in which such sum is actually paid. If you are a senior citizen the limit for the deductible amount is Rs 60,000 instead of Rs 40,000. You will have to furnish a certificate from the prescribed authority alongwith the return of income for claiming such deduction.
	India to seek German support on outsourcing New Delhi, October 3 A high-level FICCI business delegation to Germany led by Commerce and Industry Minister Anand Sharma will seek support from a key member of the European Union over the campaign against outsourcing, particularly in the US. "We will explain to them, like we did it in the case of the US that outsourcing is good for their economy. It is a two-way street," FICCI President Rajan Bharti Mittal said here. The delegation comprising senior industry leaders would be in Germany from October 6 to October 8. Mittal, who will be part of the delegation to Dusseldorf, Dresden, Berlin and Frankfurt, said "thankfully" a bill against outsourcing has been defeated in the US Senate. Germany, being the largest member of the 27-member EU bloc, would be briefed about the advantages of the outsourcing for the west. Mittal cited the case of a multi-billion outsourcing contract given by the Bharti group telecom company to the multinational IBM . The Commerce and Industry Minister, who forcefully, conveyed India's concern over anti-outsourcing voices in the US to the Obama administration recently, is expected to raise the issue with German authorities as well. The other key issue India wants to discuss with the Western countries is about the $ 1 billion being lost by India by way of deductions from the income of professionals on short-term visits in the name of social security. On bilateral relations, Mittal said the effort would be to set in motion mechanisms that would help achieve the mutual trade target of Euro 20 billion by 2012 from the 2009 level of Euro 13 billion. "We will go the whole hog in seeking FDI from Germany," he said. He said Germany's strength in technology is well matched by India's attributes of a high growth market, favourable demographics, cost-efficient production and R&D base, access to wider South Asia market and availability of skilled labour. — PTI
	Microsoft sues Motorola New York, October 3 Microsoft Corporation has said that it has sued handset maker Motorola Inc for allegedly infringing on the software gaint's nine patents in its Android smartphones. "The patents at issue relate to a range of functionality embodied in Motorola's Android smartphone devices, including synchronizing email, calendars and contacts, scheduling meetings, and notifying applications of changes in signal strength and battery power," Microsoft Corporate Vice President Horacio Gutierrez said. The company has filed the action at the International Trade Commission and the US District Court in Washington, Microsoft said in a statement. Microsoft said it has a responsibility towards its customers, partners, and shareholders to safeguard the billions of dollars invested each year in bringing the innovative software products and services to market. The company also warned that Motorola needs to stop infringing on Microsoft's patented inventions in its Android smartphones. — PTI
	Tata Steel hikes prices New Delhi, October 3 Tata Steel on Sunday increased prices of its products by around 3 per cent on account of rising demand. "We have increased prices by around 3 per cent," a Tata Steel spokesperson said. Industry experts said the raise was likely to result in an actual hike of Rs 1,500 a tonne. On an average, steel prices are in the range of Rs 30,000-40,000 a tonne now. "The upswing in demand and rise in cost of raw material has pushed up steel prices," Jindal Steel and Power Director Sushil Maroo had said last week. Steel makers also said the automobile industry has seen unprecedented sales of vehicles in the past few months and the trend is most likely to continue in the Durga Puja, Dussehra and Diwali season, pushing up the demand for steel. Iron ore prices have gone up by up to about Rs 3,300 a tonne from Rs 1,900 a tonne earlier this year. Coking coal prices are also hovering in the range of $200 a tonne as against $125 a tonne last year. — PTI