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Sunday,
June 3, 2001, Chandigarh, India  
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Move to sell Enron power to other states PTL exports Swaraj
tractors to USA Vardhman profit drops
57 per cent |
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| ‘Reduce
tax on yarn to 2 per cent’ Ludhiana, June 2 The knitwear industry of Ludhiana may lose its competitive edge to the industries of other state in the coming year because of the multi-stage taxation on yarn and knitwear material which has badly affected the cost of production of knitwear garments . Maruti sales rise
20.7 per cent
Calcium Maaza to be
launched Jobs for
professionals rise in Canada Privatise power
sector: says WB
Irrational
rate of stamp duty attracts evasion
Time to
change rule on lost ticket
Whether
contempt?
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Move to sell Enron power to other states
New Delhi, June 2 The option of sale of power from 2nd phase of the $ 3 billion project in Maharashtra was discussed in detail in a 90-minute meeting Prabhu had with Vajpayee yesterday to consider the fallout of Enron imbroglio, cited by international rating agency Fitch as one of the reasons for lowering India’s rating from stable to negative. Official sources said the meeting sought by Prabhu was fourth in the series after the Enron controversy erupted due to payments problems seven months ago. The meeting assumes importance in the wake of the Maharashtra State Electricity Board (MSEB) refusing to buy power and challenging the validity of the Power Purchase Agreement with DPC which in turn stopped commercial electricity generation. While Prabhu could not be contacted for comments, government sources said the sale of power to other states had emerged as the only option for the Centre to help the troubled project as purchase of power by central utilities was not possible. While Vajpayee wanted the project to continue, the success of central initiative would depend on the paying capacity and reforms pursued by the states which could be interested in buying power from the DPC if it lowered the tariff. Cabinet Secretary T.R. Prasad was also present during the meeting, sources said. The success of Central initiative would also hinge on the stance taken by the Maharashtra Government and the MSEB on the issue, the sources said. Prabhu had earlier met Finance Minister Yashwant Sinha in this connection, source said, pointing out that the states would have to reconcile to pay slightly more as even the electricity from National Thermal Power Corporation’s new projects would cost more than its existing tariff. Earlier, Delhi had expressed interest to buy DPC power.
PTI
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PTL exports Swaraj tractors to USA SAS Nagar, June 2 The Senior Vice-President (Marketing), Mr A.M. Sawhney, said here today that the consignment, sent yesterday, was going to Arkansas, the home state of former President Bill Clinton. Advance payment had already been received. The tractors had met the Environment Protection Agency norms, without which these could not be imported. The Swaraj 855 was developed after a thorough study of the requirements of US farmers. The 55 hp tractor, he said, had a power steering, wet brakes, roll-over protection frame, fibre glass canopy, a differential lock, four auxiliary hydraulic tappings and provision for fitment of a front-end loader. These were advanced features essential for entering the US market. Mr Sawhney said two more models would be developed for the US market, one of these being launched by early 2002 and the other in the latter half of that year. Earlier, the USA was importing 12,000 tractors annually from China which had now been totally stopped because these did not meet the EPA norms. In the US market there was a demand for 85,000 tractors with horsepower of less than 40. Even in the domestic market here PTL had introduced 16 different variants of the same model to cater to different needs.
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Vardhman profit drops 57 per cent Ludhiana, June 2 In a press release issued here today, the Board of Directors said, “The investment in fabric process house in 1999-2000 has substantially affected the profits. Moreover, the difference between the excise duty on the composite mills sector and independent process houses, and initial teething problems have affected the profits. Although, the difference in excise duty has been set right in the Budget 2001, the condition of fabric process house may take some more time to stabilise.’’ During 2000-2001, the company has expanded the capacity of its weaving unit at Baddi, by installing 48 more looms. The Board of Directors has recommended reduced dividend of 25 per cent of paid-up equity capital. However, Vardhman Polytex Limited has reported profit before interest, depreciation and tax worth at Rs 51.41 crore against Rs 42.47 crore in the previous year. The cash accruals were Rs 40.48 crore as compared to Rs 31.78 crore in the previous year. The company has recorded sales of Rs 288.29 crore against Rs 241. 33 crore in the previous year, an increase of 19.46 per cent. The Directors observed that the profitability during the year may be under pressure as the prices of yarn are expected to fall on account of the U.S. economy’s slow down and lower international prices of cotton .
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‘Reduce tax on yarn to 2 per cent’ Ludhiana, June 2 In a memorandum submitted to Mr Adesh Partap Singh Kairon, Minister for Excise and Taxation, Punjab, the Knitwear Club has urged the government to rationalise the tax structure on yarn by bringing it in line with the tax structure of other states. Mr Vinod Thapar, the President of the club, said,‘‘The tax on yarn should be reduced to 2 per cent from the present level of 4 per cent to bring it in consistency with other states. Due to the high rate of tax on yarn in Punjab, other states are enjoying undue advantage.’’ This would go a long way in making the knitwear trade competitive under a uniform taxation system. The yarn accounts for two-third value of the final product. The knitwear industry produces about 5,000 crores of knitted garments, and it might suffer badly if the taxation is not rationalised. Mr. Thapar said it would badly affect the interests of the state as the business and employment in the knitwear industry might shift to other states. He claimed that the hosiery industry was a victim of multi-state taxation. There is a 4 per cent sales tax on yarn as well as the end product. Moreover, there is a tax on recycled yarn, that is produced from knitwear waste. Mr. Thapar admitted that for taxable sales traded within the state, the traders got adequate compensation but in case of inter-state trade, no such provision existed.
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Maruti sales rise 20.7 per cent New Delhi, June 2 The company had sold 25,798 units in the same month last year. Including exports of 1,124 cars, Maruti’s May, 2001, sales stood at 32,264 cars, a company statement said today. The sales were higher by 18.5 per cent compared to 26,264 units sold in April this year. Sales of the entry model “M800”, “Omni” van, “Zen”, “WagonR” and “Alto” stood at 12,631 units, 5,318 units, 6,352 units, 2,296 units and 3,268, units respectively. Maruti sold 1,106 units of the mid-size car “Esteem” while sales of the premium mid-size sedan “Baleno” touched 169 units during the month under review. In addition, the company also sold 479 units of the multi-utility-vehicle ‘Gypsy”. Maruti’s cumulative sales (April-May 2001-02) increased by a marginal 3 per cent at 57,404 units over 55,709 units sold in the same period last fiscal. Bajaj Auto sales up Bajaj Auto has registered an impressive 42 per cent growth in the motor cycle sales in May 2001. The company sold 43,260 units in May 2001 as compared to 30,440 units sold in the corresponding period last year. In the geared scooter segment the company has been able to arrest the slide in scooter sales by registering a sale of 44,923 units in May 2001 as compared to the sale of 44,563 units in May 2000. The overall Bajaj two wheeler sales have risen by 7 per cent in May 2001 to 1,00,101 units as
compared to 93,590 units sold in May 2000.
PTI |
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Calcium Maaza to be launched New Delhi, June 2 A company spokesperson told PTI that the new drink is the result of a year-long research, conducted in Japan as well as Indian research facilities of Coke, and the company has already invested upwards of Rs 6 crore in giving “Maaza” a facelift, together with a new advertising campaign and logo. The soft drinks giant also claimed that Maaza leads in the Rs 250 crore fruit-based drinks market with 28 per cent market share, as per market research agency, Org-Marg. As per the study, Frooti is at 23 per cent besides the two Pepsi brands of Slice and Mangola at 11-12 per cent and 10 per cent respectively.
PTI
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Jobs for professionals rise in Canada Chandigarh, June 2 Speaking at the opening of its branch in Ludhiana today, Mr S. Grewal, Sr Vice-President of the company informed about the job market with particular reference to Canada and Australia. He said Canada has the unemployment rate of 8.8 per cent which is very low. He added that the number of jobs for the IT professionals, engineers, and professionals from the accounting field is on the rise. The reason for high rate of rejections, of well-qualified applicants, is mainly because of the lack of knowledge in filing of immigration applications and proving their suitability to settle in Canada. Canam is also specialising in L-1 Visas for the USA. Mr Anurag Singh Sandhu, Sr Vice-President, is already in the USA and Canada to build tie-ups with the global job placement agencies. The company has already processed a large number of applications with a high success rate and is in the process of launching its multiple offices in India and
abroad.
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Privatise power
sector: says WB Chandigarh, June 2 The bank has also conveyed its appreciation for the improvement in the collection of the Haryana power utilities after a four-member mission of the bank visited the state to review the Haryana Power Sector Restructuring Project early last month. The bank had given a loan of Rs 240 crore to the state under APL-I. The aide-memoire prepared by the mission, which has been forwarded to the state by the Country Director(India) of the bank a couple of days ago, commended Haryana for increasing the collection of the power utilities from 87 per cent in 1999-2000 to 94 per cent in 2000-2001. Last year while power availability increased by about 7 per cent, the billing registered an increase of 12 per cent. During the same period the cash collections went up by about 21 per cent. Reverting to the subject of privatisation, the bank said the state government should bear in mind the fact that the sustainability of these improvements would remain highly doubtful in the absence of privatisation of distribution. The mission also underlined the "grim" financial condition of the power sector in Haryana, which, it said, continued to depend on the government support. According to informed sources, the bank's threat to
withhold the APL-II has not unnerved the Haryana utilities, which have already tied up with certain Indian agencies for the financial support of about Rs 700 crore, almost equivalent to the amount to be provided by the World Bank under the APL-II. The sources said the work has already started on several projects which were to be undertaken under APL-II. Even after privatisation, the state will have to provide the subsidy. If the government provides timely subsidy to the power utilities, as it would be required to do after the privatisation of the power sector, the public sector's performance can be at par with the supposed good performance of the private sector. Interestingly, the sources said, while the World Bank insists on the introduction of the private companies in the Haryana power sector, it wants to provide loans to such companies only through the state government, which will be left high and dry, if the private party suddenly disappears from the scene. |
co
Recruitment blues A company of K10 infamy which was very much in vogue on the recruitment campuses earlier this year done a volte-face. Simply put, it has told those it chose in January that instead of joining in June, they co-check out whether they might still be needed at a later date. And what is that later date? November, at 1 for the time being. FIs sell, FIIs buy There is an interesting tussle on at the bourses. While the FIIs are buying, our home-grown DFIs are pressing sales. One of these DFIs it is believed fears massive redemption pressure shortly. Will it continue flooding the market with paper and how long with the FIIs absorb their sales. Mastek After bearing the brunt of a particularly rough run at the bourses and on the business front, there is news that this IT major is once again getting its act together. A plus for this company is its presence in the European market which gives it some insulation against the US economy driven slowdown worldwide. |
cr
Irrational rate of stamp
duty attracts evasion Country’s revenue policies and duties vis-a-vis the then fiscal policy of our country having income tax rates ranging as high as 93.5 per cent were likewise unjustified and impractical. Quantum and the rates of the government revenue and other taxes ought to be equivalent to the quantity of salt required in the food so as to enable the common man to comply these revenue laws happily and voluntarily as a law abiding citizen. Highly irrational and unjustified rates of taxation make the tax evasion more attractive. Rate of stamp duty, imposed by respective states under the Indian Stamp Act, is the glaring example of one of such laws. With changing times although the income tax slab being liberalised to the maximum limit of 30 per cent, the rate of stamp duty as since been rather raised to more exorbitant limits. District collectors or the other revenue authorities fix the minimum rates of the land and property for the registration purposes, to check this evasion. It astonishes that why not the authorities are not interested to hammer the nail right on its head? The economists and the persons at the helm of the affairs, as important as former Finance Minister of India Mr P. Chidambaram, from time to time have felt the need of revising the rate of stamp duty drastically down to 3-4 per cent of the value of the real estate in order to check the generation of black money and the revenue loss. On January 4, 1998, Mr P.Chindambaram, while addressing the state Finance Ministers’ conference, had emphasised that the high rate of stamp duty on the property transfer was the single largest cause of black money generation. He had then urged the state governments to reduce the stamp duty to the modest level of 3-4 per cent so that the evasion could cease to be attractive. In addition to the generation of a huge quantity of black money by way of under value and under hand sales it also amounts to large-scale tax evasion. Consultations between the Centre and the State Governments, to reduce the stamp duty, have been going on since the time of S. Manmohan Singh a former finance minister of India. By now it has been proved beyond doubt that if the tax rates are rational and moderate compliance would be better. Various state governments have neither the will nor the inclination to revise the rates of the stamp duty to rational level. For example stamp duty on registration of document such as Sale Deeds, Gifts Deeds, Conveyance Deeds etc was raised from 6 per cent to 8 per cent in the UT Chandigarh on Delhi pattern after the city was given the status of union territory on 1.11.1966 after the reorganisation of joint Punjab. Later on when the Punjab government raised the stamp duty from 6 per cent to 12.5 per cent, Chandigarh Administration also raised it from 8 per cent to 12.5 per cent on Punjab pattern. These orders when challenged in Punjab and Haryana High Court were held valid on the grounds that in accordance with the reorganisation act all the land and revenue acts of Punjab State are applicable to UT Chandigarh, hence the rates of stamp duty shall also be applicable on Punjab Pattern. Later on in year 1996, taking an initiative in the right direction, Punjab Govt reduced the rate of stamp duty from 12.5 per cent to 6 per cent but the rate of stamp duty in UT Chandigarh has not been till date reverted to the rate on the state of Punjab pattern as per previous ruling of the High Court. What to talk of rationalisation; the rate of stamp duty was recently raised from 12.5 per cent to 15.5 per cent after the notification of the municipal council in Panchkula, a district town of the state of Haryana. To have a better compliance and more revenue it requires a proper implementation of tax laws with stringent measures by rationalising the tax structure to the bare moderate level. |
by Pushpa Girimaji Time to change rule on lost ticket It is a big deal for domestic airlines to refund the cost of a lost ticket or issue another ticket in lieu of a lost ticket to a passenger? Well, the airlines certainly have you believe that if you look at their rules pertaining to lost tickets. Indian Airlines, for example, makes it clear that no refund will be paid in case of a lost ticket. In fact in a recent case brought before apex consumer court, it even quoted a regulation that put a statutory bar on such refunds! That’s not all. The “Citizens Charter” drawn up by Central government departments are supposed to talk of the citizens’ or the consumers’ entitlement or rights vis-a-vis the services, but the Indian Airlines “Citizens Charter” tells you how you cannot get a refund on a lost ticket. Says the Charter: “passengers are requested to keep their tickets in safe custody as no refund is permissible against lost tickets’. Sahara Airlines too repeats this message in bold letters on the back jacket of its ticket. When questioned about this, a Sahara official said only taxes would be refunded in case of a lost ticket, that too after a year. On a
Delhi-Bangalore-Delhi ticket costing a little over Rs 14,000 for example, a passenger can get a refund of only Rs 2,366. Jet Airways, on the other hand, said they would give a refund in genuine cases, but only after a year. However, the passenger who has lost the ticket has to file with the airlines a copy of the FIR lodged with the police, besides details of the ticket, including the ticket number. The passenger also has to sign an indemnity bond. Surely, in this age of electronic communication and computerised booking, it should not be difficult for an airline to issue another ticket immediately to a consumer who has lost his/her ticket and prevent the lost or stolen ticket from being encashed or used? Well, one can only say that where there is a will, there is a way and where there isn’t, then one can come up with any number of excuses to explain unreasonable attitudes and unfair terms governing the carriage of passengers. In fact in a recent case that came up before the National Consumer Disputes Redressal Commission, the apex consumer court too expressed its disapproval of the attitude of the Indian Airlines and said the airlines cannot get unjust enrichment at the cost of the passenger who has lost his ticket. In the case, Mr and Mrs Kini had purchased two return tickets from Mumbai to
Kolkata. Just before their return journey, they realised that their tickets were lost. They promptly filed a police complaint and also informed the airline, which however refused to issue them duplicate tickets. Eventually, they had to pay the full fare, even though the tickets were issued against their old PNR number. Upset, they filed a complaint before the District Forum, which directed the airlines to refund the cost of the tickets and also pay Rs 500 towards costs. The appeal filed by the airline was rejected by the Maharashtra State Commission, but the airline was not prepared to give up. And this time in its revision petition filed before the National Commission, it came up with a new revelation not made earlier before the lower consumer courts. It quoted the Indian Airlines Cancellation and Refund Regulations (1985) which said that no claim will be entertained against lost documents. Thus, there was a statutory bar on refund of lost tickets, the airline argued. Obviously this regulation was made at a time when airline ticketing was not
computerised. Yet, the airline had no hesitation whatsoever in using such an outdated rule to score a point and deny a just claim of the passengers. The commission, in its order, expressed its inability to uphold the views of the lower consumer courts on account of the statutory bar. This, however, did not stop the commission from expressing its displeasure over the attitude of the airline in denying refund to passengers who had the misfortune of losing the ticket. Observing that the regulations allowing refund only on production of original tickets was rather archaic in today’s situation where ticketing was
computerised, the commission said: “But for the statutory regulations we will certainly have struck down the condition that refund is not permissible on a lost ticket for all time. It will certainly appear to be unfair trade practice and the condition of no refund in case of loss, arbitrary”. Consumers should now demand a better deal from air transport operators vis-a-vis lost airline tickets and travel by only those airlines that respond positively to such a demand and offer the best deal. |
by Praful R. Desai Whether contempt? Q:
When express undertaking not given in writing before Court, whether an offence is committed by landlord qua party or qua court? Whether there is a wilful disobedience of undertaking by the landlord? Ans: This question was dealt with by the Rajasthan H.C. in Poonam Chand v Dhan Raj [2001 (1) R.C.J. 316]. There was an ejectment suit on the ground of reasonable and bona fide personal necessity. Decree in terms of compromise was passed. In that compromise, landlord had agreed to construct shops for tenants and give them to the tenants in this new building. Landlord failed to honour this undertaking. Is it a disobedience to the compromise decree? The H.C. expressed the view that in the instant case, there is no written undertaking given to the petitioner or any other tenant by the landlord to construct the shops. Since the landlord has not given any written undertaking it is difficult to hold that the landlord has wilfully disobeyed or committed breach of any written undertaking. The compromise decree arrived at between the parties, noted the H.C. does not include a written undertaking by the landlord. It is therefore not possible for the H.C., in the present case to hold that non-compliance of a compromise decree or consent order amounts to contempt of court. As a matter of fact, observed the H.C., where a contemner by making a false representation to the Court, obtains a benefit for himself and he fails to honour the undertaking, he plays a serious fraud on the court itself and thereby obstructs the course of justice and beings into dispute the judicial institution. However, the H.C. pointed out the same principle is not extendable to a consent order or a compromise decree where the fraud, if any, is practiced by the person concerned not on the court but on one of the parties. Thus, the H.C. held that the offence committed by the person concerned is qua the party not qua the Court and, therefore, the very foundation for proceeding for contempt of Court is completely absent in such cases where the disobedience of compromise decree is alleged unless there is an express undertaking given in writing before the court by the contemner or incorporated by the court in its order, there can be no question of wilful disobedience of such an undertaking. From the perusal of the revisional order dated 29-2-86, it is not deducible that the landlord has given only written undertaking, hence, the question of committing breach of such undertaking does not arise in the present case. As a result of the aforesaid discussion, the H.C. held the motion fails and consequently the same is
dismissed. |
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