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Sunday,
September 1, 2002, Chandigarh, India  
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Cellular
operators struggle to meet govt deadline LIC
Chandigarh Div sells 1,69,572 policies FICCI
welcomes decision on UTI Rehman as
brand ambassador Service
termination |
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Pick
Jindal Strips for long term
Q:
We carry on business of purchase and sale of medicines and
pharmaceutical preparations being a dealer registered under the
Haryana General Sales Tax Act, 1973 and the Central Sales Tax Act,
1956.
Guwahati-Bangkok
flight a liability
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Cellular operators struggle to meet govt deadline Chandigarh, August 31 Spice Telecom and Airtel subscribers were found standing in queues today to submit their details. In view of the security threat, the government had recently made it mandatory for all cellular operators to collect personal details from the pre-paid card subscribers. The customers were asked to fill up the enrolment forms and submit them along with a copy of identity card or proof of address. Since there were no guidelines in this regard earlier, the operators are resenting the move. They said they had to spend extra time and money to collect information from the old customers. Operators fear that in case the government did not extend the deadline, they would have to lose thousands of subscribers, as a segment of customers was still not ready to come forward to submit their details. The operators felt that the government should bear the cost of information collection. However, Mr Mukul Khanna, Senior Manager (Marketing), Spice Telecom, claimed, “We have witnessed a very good response from customers who have come in good numbers to provide information. There are about 1.75 lakh pre-paid card customers of total nearly four lakh subscribers. During the past couple of months, we have tried to create awareness among them through media campaign and SMS messages. Special counters have set up at various towns in Punjab to collect information.” Asked about the number of customers who had provided their details, he said since the data was being processed at various places, it was not possible to provide the exact number of persons who had so far come forward to submit the required documents. He maintained, “As per government instructions, the connections would be disconnected of all those customers who fail to provide information within the time limit. However, in case the government decides to extend the deadline, we would continue to operate our special counters.” Officials of the Airtel hoped that the deadline would be extended as a number of customers had yet to provide the required information.
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LIC Chandigarh Div sells 1,69,572 policies Chandigarh, August 31 In claims settlement during 2001-02, the division settled 88128 maturity claims and 2335 death claims paying Rs 133.76 crore and 18.82 crore, respectively. Pension and group insurance unit also achieved budgeted targets on all the counts. 249 new schemes covering 40,127 lives with premium income of Rs 11.14 crore were introduced during the year 2001-2002, registering a growth of 71 per cent over the last year. Under the Jan Shree Bima Yojna which is for the benefit of the weaker sections of the society, the division covered 20, 081 lives. The LIC has also started accepting premium on the Internet, besides installing kiosks at various centres to give information about the organisation and its various products. During the year ending March 31, 2002, the corporation sold 2.32 crore policies for a sum assured of 1,92,572.31 crore and collected first-premium income of Rs 14,843.32 crore, which is a record showing a growth of 16.25 per cent, 54.36 per cent and 137.11 per cent, respectively.
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FICCI welcomes decision on UTI
New Delhi, August 31 In a statement the chambers said the move would help UTI to reorient itself to actual market conditions and recreate its position of market leader. It said the decision would help restore faith in the minds of small investor and in turn would boost the market sentiment. It added that even corporates would stand to benefit as they were dependent on institutions like UTI for long term funding. FICCI hoped that the government would ensure gradual movement of the UTI from assured returns to NAV-based schemes even within the existing US-64 scheme.
PTI
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Rehman as brand ambassador
Mumbai, August 31 The music maestro will compose tunes for AirTel that can be downloaded as ring tones by over two million subscibers across the country. “These will be ready in a month’s time,” Bharti Director Hemant Sachdev said.
UNI
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Service termination Q:
Whether termination order always carries a stigma and thus enquiry and notice is compulsory? Ans: The S.C. in Shailja Shivajirao Patil v President, Hon. Khasdar UGS Sanstha [2002-II-LLJ-813] opined. Service of one probationer was terminated and the W.P. against that order of termination was dismissed by the Bombay H.C. against this order, the appellant is before the S.C. The appellant contended that the order, on the face of it, must be held to be stigmatic in nature and as such, the order could not have been passed without holding an enquiry and finding the appellant guilty of any charge. He further contended that in accordance with the rules one appellant was at least entitled to notice before termination, and no notice having been given, the order of termination is bad in law. The S.C. did not find any force in either of the contentions raised. The notice of appointment itself unequivocally indicated the tenure of appointment, and that the appointment could be terminated at any time without notice. The question whether an order of termination of a probationer or temporary employee could be held stigmatic came up for consideration before a Bench of this Court (JT 2001 (g) SC 420). In that case also, an enquiry had been held prior to the order of termination. On examining the entire gamut of case law right from Dhingra’s case, the Court come to the conclusion that a mere holding of an enquiry does not IPSO FACTO make the order of termination penal in nature, once the employer wishes not to continue the inquiry in exercise of his right in accordance with the terms of appointment. The Court held that the enquiry held prior to the order of termination cannot turn otherwise innocuous order into one of punishment. An employer is entitled to satisfy itself as to the competence of a probationer to be confirmed in service and for this purpose satisfy itself fairly as to the truth of any allegation that may have been made about the concerned employee. Bearing in mind the decision of this Court in the aforesaid case, and on examining the facts and circumstances together with the impugned order of termination, the S.C. held that there is no justification for interference with the impugned order, and in the view of the S.C. the impugned order cannot be held to be stigmatic in any way. The appeal accordingly was dismissed by the S.C.
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by Ashok Kumar Pick Jindal Strips for long term Q: Is Jindal Strips a good buy? — Himanshu Kapadia, Bilaspur Ans: Jindal Strips (JSTR) is India’s largest integrated stainless steel manufacturer, with a market share of 43 per cent. It will be among the 10 largest such producers globally, once ongoing expansion is completed. Since its listing in 1986, the company has made profits every year. Global steel prices have seen a continuous uptrend in the current year, bouncing off 12 year lows hit in late 2001. Stainless Steel has seen a similar surge, with prices moving up by almost 20 per cent since April 2002. For FY02, JSTR’s exports surged 154 per cent to Rs 417 crore. Buoyed by this success, it has stepped up its marketing efforts and expects exports of Rs 650 crore in FY03. However, the debt and interest burden will reduce correspondingly. For the fiscal ended March 2002 sales were Rs 1360 crore, PBIDT was 17.7 per cent, net profit was Rs 44.5 crore and the EPS was Rs 23.5. For the quarter ended June 2002 sales were Rs 428.10 crore, PBIDT was 74.37 crore and net profit was Rs 10.61 crore. Although the company is highly leveraged, its debt/equity ratio should come down as the business generates free cash flow going forward. JSTR is a value buy for long term investors.
Q: Should I hold or sell Tata Chemicals? — R. Naresh, Rohtak Ans: The company has made significant progress in transforming itself from being a leading domestic chemicals manufacturer to a globally competitive, service-oriented provider of products and services in the inorganic chemicals and fertiliser industries. In the first phase of this transformation, Tata Chemicals has successfully restructured and repositioned its operations to focus on its core business — soda ash, salt and urea. Today, Tata Chemicals is the domestic market leader in soda ash and produces about 42 per cent of India’s soda ash output. In its fertiliser business, it is one of the most efficient producers of urea in the world. Its inorganic chemicals business, which forms 55 per cent of the total business, covers soda ash, salt and sodium bicarbonate. An encouraging trend in the soda ash sector is that, despite an increase in domestic soda ash capacity with the entry of Nirma, prices have remained the same. Increasing exports have resulted in reducing the supply overhang contributing to stable prices. For the fiscal ended March 2002 sales were Rs 1311.1 crore, PBIDT was 36.8 per cent, net profit was Rs 139.9 crore and the EPS was Rs 7.7. For the quarter ended June 2002 sales were Rs 365.22 crore, PBIDT was 116.31 crore, and net profit was Rs 36.11 crore. Higher efficiencies through cumulative benefits that accrue from continuous cost reduction, transformation into a marketing-led operation across all activities and the tapping of regional exports markets will be the key drivers of operating growth and increased profitability in FY 2002-03. Considering the company’s inherent strengths, investment in the stock could fetch moderate returns.
Q: Should I hold Glenmark? — Gursewak Singh, New Delhi Ans: Glenmark Pharmaceuticals (GPL) has reported excellent results for the 1Q03 with 16.8 per cent growth in sales and 32 per cent jump in the net profit. CDC Capital Partners, UK has recently decided to invested Rs 50 crore in the equity capital of the company. GPL has gone into the manufacture of API as a backward integration strategy. The company’s two NCE molecules are progressing well in the clinical trials. GPL has introduced the antibiotic, Lizolid (Linezolid) for the first time in India. This belongs to a new class of antibiotics used against the resistant bacteria. GPL has successfully launched new products such as Esoz (s-Omeprazole) and Glevo (Levofloxacin) in the domestic market. These products have been well accepted by the medical profession. The most important thing would be the success of two lead molecules and commencement of returns from the Goa facility. For the fiscal ended March 2002 sales were Rs 240.2 crore, PBIDT was 20.9 per cent, net profit was Rs 22.8 crore and the EPS was Rs 22.4 . For the quarter ended June 2002 sales were Rs 41.6 crore, PBIDT was 22.2 per cent and net profit was Rs 3 crore. Existing shareholders could stay invested in this scrip.
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by A.K. Sachdeva Q: We carry on business of purchase and sale of medicines and pharmaceutical preparations being a dealer registered under the Haryana General Sales Tax Act, 1973 and the Central Sales Tax Act, 1956. A consignment of goods that came to be dispatched by us was in the recent past intercepted and detained by an Excise and Taxation Officer on the ground that the same needed verification. The documents such as sale invoice, goods receipt and transit challan in form ST-38 (outward) in support of the goods sold were duly prepared and issued to the driver in-charge of the vehicle. On being contacted, the Excise and Taxation Officer has asked us to deposit penalty under sub-section (6) of section 37 of the Haryana General Sales Tax Act, 1973. Our consistent requests for the release of the goods without penalty did not have any impact. Kindly advise us on this issue with reference to the provisions of law in this context. — Rakesh Gulati, Hansi Ans: Sub-section (5) of section 37 of the Haryana General Sales Tax Act, 1973 authorises detention of goods under transport only if either the goods are not found supported by proper and genuine documents or that the person carrying them is attempting to evade the payment of tax due under the Act. However, the point “the transaction needs verification” does not fall within the purview of the aforesaid provisions of law inasmuch as the goods were admittedly supported by statutorily prescribed documents. No valid ground, therefore, exists for imposition of penalty under sub-section (6) of section 37 of the Haryana General Sales Tax Act, 1973. It may not be out of place to clarify here that the officer taking recourse to seizure of the goods is enjoined with the duty to record in writing the relevant reasons so as to justify his action. This safeguard to the dealers is provided under the law to avoid arbitrariness on the part of the checking officers in the matter of detention of goods during checking of the goods. Further the only basis for imposition of penalty under sub-section (6) of section 37 of the Haryana General Sales Tax Act, 1973 is “attempt at evasion of tax” and onus lies on the officer initiating the proceedings to record a finding on the basis of the legally acceptable evidence to the effect that the party intended to evade the payment of tax in relation to the goods transported by him. This decision cannot be arrived on mere presumptions or whimsical notions. The legality of the action effecting detention of the goods and subsequent proceedings proposing imposition of penalty can well be objected to by way of filing a detailed reply to the show cause notice issued by the checking officer. In the event of penalty being levied, the queriest can also approach the appellate authority assailing the correctness and validity of the action taken by the checking officer.
Q: In relation to the assessment year 1998-99, the assessing authority had raised additional demand of tax under the Haryana General Sales Tax Act, 1973. Allowing the appeal, the appellate authority quashed the orders of assessment, so far as they related to levy of tax over and above the one we had admitted in the returns. Upon this, we filed an application before the assessing authority claiming refund of the amount of tax becoming admissible in consequent upon the setting aside of the orders passed by him. The application is still awaiting disposal despite several requests. Kindly advise on this issue. — Naresh Kumar, Bhiwani Ans: As per the provisions contained in sub-section (1) of section 43 of the Haryana General Sales Tax Act, 1973 read with clause (b) of sub-rule (1) of rule 35 of the Haryana General Sales Tax Rules, 1975, it is obligatory for the assessing authority to dispose of an application seeking refund within sixty days from the date of its submission. In the event of matter being delayed beyond stipulated period, the assessing authority is statutorily obliged to allow interest at the rate of 1 per cent in respect of first one month and at the rate of 1.5 per cent for the subsequent period during which the application for refund remains undisposed of. This legislative is quite clear from the wording of sub-section (2) of section 43 of the Haryana General Sales Tax Act, 1973 according to which “where an amount required to refunded by the assessing authority to any person by virtue of an order issued under this Act is not so refunded to him within the period as may be prescribed, the dealer shall be entitled to interest at such rates and on such terms and conditions as may be prescribed.”
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by K.R. Wadhwaney Guwahati-Bangkok flight a liability Strange are the ways of Air-India’s commercial unit. Without a proper evaluation and adequate assessment of market, it hastily initiated the Guwahati-Bangkok flights, only to realise within five months that it was a wasteful exercise. Any aviation person could see that the operation would be a huge liability on the national carrier, which is already passing through a critical phase. The inauguration of the Guwahati-Bangkok flight on April 4 was undertaken with a lot of fanfare. Many “freeloaders” were accommodated on the inaugural flight. In about five months (29 flights), Air-India has sustained a loss of about Rs 6 crore. Barring the inaugural flight, no flight has carried more than 35 per cent of passengers, resulting in a loss of more than Rs 18 lakh on every flight. To cut even, the national carrier needs at least 55 per cent seat occupancy. To secure such a large number of passengers from Guwahati is a futile exercise. Disturbed at the enormous losses, Air-India is contemplating to discontinue its operations. When Indian Airlines started operations from Lucknow to Sharjah (two flights a week on Wednesday and Sunday), it undertook a proper evaluation and flights are functioning satisfactorily. Minister for Civil Aviation Shahnawaz Hussain is thinking to transfer the operations to Indian Airlines.
Another
setback There are wheels within wheels in Indian aviation where nothing moves without political clearance. There are several hinderances which two national carriers, A-I and I-A, have to cross before they are able to induct new aircraft into their fleet. Then there is a virtual war of attrition going on between mega manufacturers, Airbus Industries and Boeing. Each wants to have bigger share in Indian skies. Prices are being varied. Different calculations and strategies are at work. While on school is selling the idea for large and medium-capacity aircraft, the other school of officials say that small version of aircraft would be viable for this country. Air-India’s share of market originating from India continues to decline as sales officers at Mumbai and Delhi are doing little to promote airline’s sales. Air-India is wholly dependent on general sales agents (GSAs) who are paid 3 per cent more commission in addition to over-riding commission in comparison to IATA-approved agents. About fleet expansion, a report says: “The inability to attract high-yield passengers is because of A-I’s marketing, service and image”. In view of this observation, the ministry has appointed a sub-committee to examine the report. In the existing aviation scenario, the committees and sub-committees merely increase red tape instead of making any positive impact on the travelling public. The seething over seating by Bihar Chief Minister Rabri Devi on an Indian Airlines flight to Patna has caused amusement and anguish in the aviation circles. Treating it as ‘insult and humiliation’, her protest on change of seats from the front row to the third has led to suspension of two staff members. |
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