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| Sunday, August 6, 2000, Chandigarh, India   
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Rating norms
harsh for SSI Paper mills yet
to procure hyacinth |
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IT team for USA
Seminars on immigration CHANDIGARH, Aug 5 — Punjland Canwest Alliance with the Greater Punjab Trust for Education, Training and Employment will spread awareness about immigration and career opportunities in Canada and New Zealand through seminars in Amritsar and Ludhiana. Bajaj Auto sales zoom
CALCUTTA, Aug 5 — ITC Hotels Limited, has undertaken a re-branding exercise to enable consumers identify the various products offered by the
company. To further focus the positioning strategy, hotels in the ITC-Welcomgroup chain at the upper end of the market would be branded into four categories. Company sources said, “Super deluxe hotels of the group will henceforth carry the ITC prefix while the five-star category will carry the brand name WelcomHotel. These will be supported by the two existing categories called WelcomHeritage, consisting of palaces, forts and ‘havelis’ (heritage hotels) and Fortune, which caters to the mid-market segment.” The exercise is part of the company’s strategy to gain dominance in the upmarket business traveller segment while establishing presence in the mid-market as well as leisure segments through the Fortune and WelcomHeritage brands, the sources added. A substantial financial outlay is envisaged with the support of holding company, ITC Limited, which has identified the hotel sector as one of its core businesses. ITC Limited Chairman Yogesh Chandra Deveshwar, who is also chairman of ITC Hotels, told reporters last week, “After entering the hotels business 25 years ago, the company lost direction and ventured into financial services and edible oil businesses. As a result, we failed to make our presence felt in a number of regions of the country, including in several metros.” “We will now take up projects in metros and also in the southern part of the country. ITC Grand Maratha, our new hotel at Sahar in Mumbai, will open in the last quarter of 2000,” he said. Work has started on two other projects — the ITC Sonar Bangla at Calcutta and ITC Grand Towers at Upper Worli, Mumbai, Deveshwar said. The Calcutta hotel would cost Rs 2.65 billion. The land for the project has already been acquired. About Maharaja Heritage Resorts Limited, a joint venture with Marudhar Hotels, a company official said it was making steady progress with 16 properties operating under the WelcomHeritage banner. Sources said ITC would try to preserve historic buildings. “Given the increasing popularity of the heritage experience, this branded hotel product has a bright future,” sources said. They claimed that the company, with its balanced portfolio, was well placed to take advantage of the anticipated growth in travel and tourism.
— IANS
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Package for HMT
Srinagar on anvil SRINAGAR, Aug 5 (PTI) — Union Ministry of Industry is finalising a package for HMT Srinagar within a fortnight at the intervention of Prime Minister A. B. Vajpayee. This was disclosed by the Union Defence Minister George Fernandes, who along with Chief Minister Farooq Abdullah, visited the unit at Shelteng, near here, last evening. The Defence Minister had been to the HMT unit on his earlier visits to the state at the request of the Chief Minister, who had apprised him of the need for finding more work for the unit instead of closing it down as was being considered by the Union Government. Fernandes said yesterday that he had discussed the matter with Prime Minister and the latter intervened when the proposal to close down the unit came before the Union Cabinet recently. The Prime Minister has since decided that the unit will not be closed down, but instead the Union Ministry of Industry will work out a package to get more work for the Srinagar unit and generate more employment, Fernandes said. Farooq Abdullah thanked Prime Minister and Defence Minister for the decision. |
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Rating norms
harsh for SSI TO stamp out the volatility the RBI has used interest rate. This is reversal of the RBI’s and the Finance Ministry’s stand on interest rates. The April’s credit policy and Budget saw lower interest rates. The RBI’s reaction to falling rupee is this edgy rather than composed. The RBI’s logic is that the widening difference between US and Indian interest rates was leading to a shift in asset preference from rupees to dollars. The RBI has to do some explanation for this. When US Federal Reserve raised interest rates last year to cool the overheated economy the RBI worked towards lower rates as Indian economy has to emerge from slowdown. Why did RBI lower the rate when rates were rising in USA. Now when USA has put the rates hike on hold we have raised them. Rupees fall is attributed to high US interest rates, steep crude oil prices, stiff defence pay-outs on equipment and FII’s shifting out $ 218 millions in June. Rupee today is less than 5 per cent lower than the last year’s level. Over this period Euro is down by 8 per cent pound by 4.4 per cent and yen by 11.8 per cent. Hike in interest rates and CRR will hit the industry at the lower end very badly. So far the government’s own borrowings have been slow due to higher revenue: In the coming months the government’s huge borrowing will hit the industry hard. Credit-deposit ratio is hovering around 50 per cent and has inched to 52 per cent recently. Credit squeeze may be the order. The small scale industry is already getting harsher treatment from banks. Very high rates of interest are being charged over PLR. This is justified on the basis of ratings of smaller units. Reality is that rating norms for the SSI borrowers are very harsh and the same as for large borrowers. Rating norms require profitability ratio tax at 2.5 per cent. This means over 5 per cent before tax. This is simply not possible. While computing risk rating in case of partnership firms interest and salary paid/payable to the partners is not taken as part of profits; even if it is not withdrawn. This leads to worsening of ratings. Some cases this results in denial of credit. This clearly goes against the spirit of the RBI instructions. With RBI further going tough on borrowers to check the fall of rupee the SSI sector is in for still bigger financial trouble. |
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Paper mills yet
to procure hyacinth FEROZEPORE, Aug 5 — The paper mills have not yet picked up the water hyancinth, flushed out of the Harike wetland lake near here by the Army for industrial use. Although Punjab Government had earlier approached several paper industries to procure water hyacinth for use as a raw material, about 1,000 tonnes of hyacinth flushed out so far remains unutilised. Among the groups known to be approached by the Punjab Council for Science and Technology were Shrayans Paper Industry of Sangrur and Narinder Mills in Amritsar. It is learnt that the Punjab Government had also directed its Pollution Control Board to contact some other paper mills to make the economical use of hyacinth. So much so, the government had assured to provide free of cost hyacinth to the
industry to ensure that the lake is frequently cleared off the weed. Although authorities have not yet assigned any reason for the delay, the Principal Secretary of the Council, Mr Rajan Kashyap assured that the hyacinth shall be dried up before it could be brought into use. The experts are of the view that the frequent use of water hyacinth can save the lake from pollution in future. Apart from manufacturing the paper and cardboard, the water hyacinth can also be used for making of pillow covers. |
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IT team for USA NEW DELHI, Aug 5 — The Electronics and Computer Software Export Promotion Council (ESC), an organisation of the Ministry of Information Technology, is mounting a 36-member high-powered business delegation from 26 companies to the USA to promote export of IT-enabled services, especially call centres. The ESC delegation will also participate in the 12th ICCM Call centre Management Conference and Exposition at Chicago which would be India’s debut at this important international event. Mr Rakesh Gupta, Chairman, IT Committee, will lead the delegation. The ESC delegation will comprise of senior executives of some of the leading companies including Air Infotech, RDM India, Inde-Dutch Systems, Golden Datamation, Lee & Nee Software, ETOS Consulting, Cincom Systems India, Datamatics Direct Marketing, Innosoft, Websity Infosys, Cybiz Technologies, Nucleus Software, Majestic Software and Mangalam Information Technologies. |
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Essar Cell scheme CHANDIGARH, Aug 5 — Essar Cellphone has launched happy hours plan in Haryana. During the happy hours — from 9 p.m. every night to 8 am. the next day — customer benefits directly as airtime on all outgoing calls made by subscriber from his mobile will not be charged. The plan can be availed by any subscriber in this circle by paying Rs 199 as the monthly rental. During these hours all incoming calls will be billed as per the plan chosen by the subscriber (also in a few tariff plans offered in Haryana, Essar gives its customers free minutes in incoming and outgoing calls.) It has also started three value added services called the Maruti online, food online and courier online. Under Maurti online, the subscriber can ask for assistance from the car service station by dialing 700. Courier-online offers the subscriber the facility of a courier pickup from anywhere within the city by dialing 701. Under food-online, the subscriber can dial 702 and get connected to the local restaurant that will deliver the desire food. These services can be availed for no additional subscription cost. |
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SBI ATMs for Shimla CHANDIGARH, Aug 5 — The SBI, Chandigarh circle, will install two ATMs in Shimla and Sanjauli centres. This was disclosed by Mr D. P. Singhal, DGM, SBI, Zonal Office, Shimla at a function. In the function the bank’s personal segment deposit and loan schemes were made at three institutions — the Central Potato Research Institute (CPRI) Shimla the Nathpa Jhakri Power Corporation, Shimla, and the Indira Gandhi Medical College (IGMC) Shimla, as a part of a deposit mobilisation campaign in co-ordination with its staff training centre, Panchkula. Mr G. S. Sekhawat, Director (CPRI) was the chief guest in the first presentation, Mr S. K. Biswas, Manager (Personnel) was the chief guest in the presentation at
NJPC. |
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Seminars on immigration CHANDIGARH, Aug 5 — Punjland Canwest Alliance with the Greater Punjab Trust for Education, Training and Employment will spread awareness about immigration and career opportunities in Canada and New Zealand through seminars in Amritsar and Ludhiana. We want the public to know all aspects of the government policies of Canada and New Zealand on immigration, settlement and employment, said Mr Navreet S. Hundal, Managing Director, Punjland Overseas Services. Due to the lack of proper information on immigration and overseas settlement matters, some persons use illegal ways to migrate to foreign countries. Mr Anoo Lal, President and CEO, Alliance Canada Inc, and Ms Uma Venkatraman, former Canadian Immigration Program-Coordinator, Canadian High Commission, new Delhi, addressed the audience at these seminars. |
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Bajaj Auto sales zoom MUMBAI, Aug 5 (PTI) — Bajaj Auto Ltd’s (BAL) sales zoomed up 118 per cent at 32,696 units in its motorcycle segment in July, 2000 compared to 14,998 units in the corresponding period last year. Sales of Kawasaki Bajaj range has boosted BAL’s market share to 22 per cent in the motorcycle segment in India, Vice President (business and product development) R. L. Ravichandran claimed in a release here today. An overall growth of 3 per cent was achieved by BAL in two and three wheeler sales in July 2000. |
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by Praful R. Desai Closure proper Q: On an application for closure by the company, did the Government considered all aspects before ordering closure? Ans: The SC considered this point in Dayakar Reddy v MD Allwyn Auto Ltd (2000-1-LLJ-1439) and expressed the view thus: In a case where the company is State Government, it has to take an administrative decision first and then a quasi-judicial decision U/s 25.0 of the ID Act. The SC noted that while exercising its power U/s 25.0, it did follow the proper procedure and considered all the relevant aspects. It is not possible to find any fault with the decision of the State Government. The facts of this case are very eloquent. Moreover, by the time the government took the decision, out of 1800 workers, 1200 workers had shown their willingness to accept the Voluntary Retirement Scheme. The G.O. dt 16.6.97 clearly discloses the reasons why the company had become unviable and why it was not able to carry on its activity any further. The reasons appear to be genuine and adequate and therefore the government was justified in granting permission for closure of the company, in the opinion of the SC. This Special Leave Petition was consequently dismissed. However, in order to see that the workmen who had not opted for any of the two schemes — Voluntary Retirement Scheme and Special Rehabilitation Scheme — are not deprived on the benefit of the scheme applicable to them, the SC extended the date for making an application for the purpose till 1.3.2000. The SC directed the company to extend the benefit of the applicable scheme to all the workmen who want to avail of it. The company was also directed to make payments within one month from the date of making an application to those workmen who have not applied so far and within 15 days to all those who have given their options earlier. |
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From Ashok Kumar in Mumbai Aftek Infosys future fair Q: Please comment on the investment prospects of Aftek
Infosys.Aftek Infosys concentrates on the segments of embedded software, system, web designing and programming and its product profile comprises Personal Data Assistants (PDAs), bar code readers and multi-lingual terminals. The company has a tie-up with MobiNetix, USA that manufacturers and markets the complete range of Pen Ware brand products, known to be the most technologically advanced. It also has access to the designing facility of MobiNetix, which will hold it in good stead in the long run. In addition, Aftek has also tied up with Mediamatics for support and development of the Digital Versatile Disc drive (DVD) and user interface. The patent for DVD technology rests with Mediamatics. The third segment where Aftek is active, is in the arena of web designing and programming, wherein it has executed assignments for Pidilite, Blue Dart and Hinduja hospital. It has also created a second facility at Solapur and transferred its hardware operations to a subsidiary. On the financial front, the company’s performance has been satisfactory. During the quarter that ended in March 2000, the company posted an income of Rs 5.5 crore and was operating at an OPM per cent of 50.1. For the aforementioned period it recorded a net profit of Rs 2.5 crore. Overall, the medium to long term prospects of Aftek Infosys appear fair and considering the same, investors with a medium to long-term perspective could include this scrip in their portfolios. Q:
Do you recommend a hold in Rallis India? Are fresh investments in the same advisable? Delayed disbursement of subsidies by the government has put pressure on Rallis India. For the year that ended in March 2000, the company posted sales worth Rs 1432.5 crore and an OPM per cent of 6.4 Net profit for the year stood at Rs 24.6 crore and the EPS worked out to Rs 20.5. In order to try and bring about a reduction in costs, Rallis has introduced a Voluntary Retirement Scheme (VRS). Its ongoing upgradation programme is likely to improve its efficiencies and margins in the future. In view of the abovementioned factors, while existing shareholders could stay invested in this scrip, fresh investments in the same is not recommended. Q: Do you advise a long-term investment in Ashok Leyland? Ashok Leyland (ALL), in which the Hindujas hold a stake of 35.7 per cent and Fiat, Italy, holds 15.7 per cent is the second-largest commercial vehicle manufacturer in India. Joint venture with the TVS Group for bus-body building, in addition to the creation of new unit for pressed metal components. With substantially higher sales in this fiscal and lower financial charges, the company appears poised to record a higher profitability in view of which its medium to long term prospects appear fair and hence investment therein could be considered.
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by A.K. Sachdeva Q: We are engaged in the business of karyana goods being a dealer registered under the provisions of the Haryana General Sales Tax Act, 1973 and the Central Sales Tax Act, 1956. Kindly let up know the grounds on the basis of which an assessing authority can proceed to seize the books of account of a registered dealer. What are the duties of the assessing authority while taking recourse to seizure? — Arun Kumar Sharma, Sonepat Ans:
Sub-section (3) of section 36 of the Haryana General Sales Tax Act, 1973 lays down that if the Commissioner or any person appointed to assist him under sub-section (1) of section 3 not below the rank of an Assistant Excise and Taxation Officer has reasonable grounds for believing that any dealer is trying to evade liability for tax or other dues under this Act and that anything necessary for the purpose of an investigation into his liability may be found in any book, account, register or document, he may seize such book, account, register or document as may be necessary. As for as duties of the inspecting officer are concerned, he is required to issue a receipt for seizure of the books. The officer seizing the book or any other document shall also return to the dealer the books and other documents within a period of ten days from the date of seizure in the case of book, account, register or document which was being used at the time of seizing. In any other case, the seized documents shall be returned to the dealer within a period of 60 days from the date of seizure. Q:
Our firm carries on business of machinery, its parts and accessories being a registered dealer under the Punjab General Sales Tax Act, 1948 and the Central Sales Tax Act, 1956. During the assessment year 1997-98 we had sold goods in the course of inter-state trade or commerce and realised 4% Central Sales Tax on undertaking given by the buyer that form ‘C’ would be supplied in due course. However, subsequently the buyer has declined to issue the form ‘C’ against the aforesaid transaction. In the assessment proceedings, the assessing authority opines that unless form ‘C’ is furnished the claim of concessional rate of tax cannot be allowed. Kindly advise. — M.K. Engineering Works, Batala Ans: The claim of concessional rate of tax under the Central Sales Tax Act, 1956 can be availed of only if the selling dealer effecting inter-State sales furnishes form ‘C’ in terms of section 8(4)(a) read with rule 12 of the Central Sales Tax (Registration and Turnover) Rules, 1957 after obtaining the same from the buyer. This is a mandatory requirement of law as has been held by the Supreme Court of India in the case of Kedarnath Jute Manufacturing Co. Ltd v. Commercial Tax Officer (1965) 16 Sales Tax Cases 607 (SC). It was also ruled that the dealer claiming the benefit of concessional rate of tax has to strictly comply with the provisions of law, requiring him to furnish the declaration in the prescribed forms and that he cannot be allowed to produce other evidence to prove that the sales were made to a registered dealer. |
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by Pushpa Girimaji Why consumer cases tend to drag on IN order to ensure that cases do not drag on indefinitely and consumer complaints get redressed at the earliest, the Consumer Protection Act provides for consumer courts to hear cases ex parte. That is, once a consumer files a case, a copy of it is sent to the opposite party, directing him to give his version within 30 days. The court can extend this period by another fortnight. However, if the opposite party fails to respond, then the court can go ahead with the adjudication of the dispute on the basis of the evidence brought before it by the consumer. Seems quite simple, but not so in practice. In many cases, the opposite party does not respond to the notice and if the case is decided in favour of the consumer, then files an appeal against it before the higher consumer tribunal. Or sometimes, the opposite party appears while the adjudication process is almost complete and seeks an opportunity to present his version. There are also cases where the opposite party says that no notice has been received from the court. If one were to go through the orders of the National Consumer Disputes Redressal Commission, which is the apex consumer court, one gets a fair idea of how the courts have dealt with such cases. Of course where the opposite party proves that he never got the notice, then consumer courts will have to provide him additional time to submit his written version and also present his case before the court. But what about cases where the opposite party does not appear despite being served a notice? Take the case of Pramod Kumar Bothra vs Ishwar Chand Sharma. Mr Bothra did not reply to the copy of the complaint sent to him. Nor did he respond to the notice of hearing of the case. The court would have been perfectly justified in hearing the case exparte. In fact it should have, considering the fact that the courts are discouraged from giving adjournments and the cases are expected to be decided within 90 days. However, the State Commission adjourned the case not once, but thrice, to give Mr Bothra a chance to appear. He failed to make use of the opportunity, but once the case was heard and the order was passed, filed an appeal before the National Commission. His contention was that the State Commission had erred in proceeding ex parte and therefore the order should be set aside and the case remanded for fresh trial or in the alternative, he be permitted to lead evidence in the appeal before the National Commission. While dismissing the appeal, the apex consumer court said the State Commission was fully justified in basing its findings on the evidence brought to its notice by the complaint. It also said that if no reply had been filed before the State Commission, then at the appellate stage, the appellant cannot be allowed to refer to his version and say that the findings of the State Commission are incorrect. In the case of South Delhi University Teachers Cooperative Group Housing Society Ltd vs Dr Madhu Rathore, the National Commission pointed out that since the opposite party had not filed its written objections within the period allowed by the statute, it was well within the power of the State Commission to hear and dispose of the case without granting further time to the opposite party to file its objections. But even in such an event, the opposite party had every right to be heard by making its oral submissions before the State Commission on questions of fact as well as law. And in the interest of justice, an opportunity may be given to the opposite party to file written objections on payment of costs of Rs 2500 to the consumer. Similarly, in the case of south Indian Welding Works vs Jagadambika Rice Mill, the National Commission set aside the exparte order of the State Commission and directed it to give the appellant a chance to present his version on payment of Rs 10,000 as costs to the complainant. In the case of I.S. Bhatia vs Anil Kumar Mehta and others, the National Commission remarked that the principles of natural justice required that a party should be heard in defence of the action instituted against him. If the opposite party appeared at the later stage of hearing, he should be allowed to put forward his contention, subject to the limitation that he cannot be allowed to reopen earlier proceedings and can put forward only his oral submissions in the nature of arguments in the case. Certainly, natural justice demands that the opposite party be given a chance to defend his actions. However, manufacturers and service providers should not be allowed to play truant with the consumer courts, as that would defeat the very purpose of the act — to provide speedy redress of consumer complaints. |
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SBP branch Dabur Bausch & Lomb ISO 14001 BOI CERA Railway projects |
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