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Monday,
December 2, 2002, Chandigarh, India  
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When you
lose your baggage during travel
Remain
covered till hundred |
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Tax
queries
Cummins
prospects satisfactory
Lawyers
can be sued for deficient service
Sustained
bull-rally buoys up the market FIIs net
buyers in equities
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When you lose your baggage during travel The recent spate of Rail accidents shows that there is no guarantee to the lives of the passenger. The railway department stepped out of control, and no one is having control as to how to prevent accidents. The railway authorities are also clueless as to various things like reasons for accident, as to the total number of passengers involved or to the number of unauthorised persons travelling, as the toll of accident victims never tally with official figures. Similarly, there is no guarantee to the luggage of the passengers. It’s common feature that most of the travellers are complaining about their missing luggage but no one can take their complaints seriously. Chain snatchers, bag lifters, pick pocket’s are also travelling like regular passengers, and complete their work without any hitch or check. Snatching of chains from ladies sitting near windows is common feature in tourist centers like Varanasi, Allahabad, Jhansi, Calcutta etc. as the chain snatchers are also aware that victims are tourists and have no interest in filing complaints and fighting out cases. Bag lifting or missing luggage is another common menace that affects all travellers. Long distance passengers generally tie their baggage with strong chains, and lock them. About the security provided to the passengers luggage the less said the better.
Rail fare The railways have also enhanced ticket fare to provide security to the passengers. The security personnel posted inside the moving trains, generally harass the genuine passengers instead of nabbing the thieves. Such type of incidents are common in certain junctions like Itarsi, Jhansi junction in northern India, where most of the South bound trains, reaches during night, and the security staff, forces the passengers, and collect some thing from them. It is also in news recently that a bogus ticket collector was caught at Howrah railway station, collecting fare from ticket-less passengers. He was also issuing printed receipts, and on inquiry he revealed that he was acting like a ticket collector for more than 15 years and can easily identity ticketless travellers. The above incident shows the wider lawlessness or confusion prevailing in Indian Railways. The issue regarding security to passengers luggage and whom they have to contact in case of theft, was elaborately discussed in a recent case before Karnataka State Commission. One Sabhashni L. Katkar, lost her baggage, near Sholapur in Kerla Express, while she was travelling from Mumbai to Bangalore. The incident took place around 3 a.m. near Sholapur on January 13, 1997. The value of the luggage lost was Rs 32,035. The passenger, immediately informed to the Railway Protection Force (RPF) personnel, who were also travelling in another couch in the same train. The RPF personnel, were sleeping during that hour, instead of discharging their duties. She woke them up, as lodged a complaint at 7 a.m. at Sholapur Police Station, as advised by RPF. She also made a complaint to the ticket inspector.
Complaint Ms Katkar also filed a complaint before District Consumer disputes redressal Commission, Bangalore claiming compensation. She alleged that there is deficiency in service, as RPF was negligent and its personnel were sleeping without even locking the vestibule doors at the night, which they are supposed to do as per instructions in vogue. She alleged that she is suffering because of their negligence and the loss of luggage also occurred because of deficiency in service. The learned district forum allowed the complainant and awarded a compensation of Rs 32,035. Aggrieved with the order the Railways filed an appeal, against the order. In the appeal two important questions were raised. The first one is relating to jurisdiction. i.e. where the cause of action has arisen. Generally the cause of action arose where the property was stolen. In the instant case it is difficult to identify the place at which the baggage was stolen. The other question is relating to the competent court, which is having jurisdiction to try and decide the complaints. The Railways contended that it is the Railway Claims Tribunal, established under the Railway claims Tribunal Act 1987, was the appropriate forum. But not the consumer court. The State Commission observed that under Sec 11 of the Consumer Protection Act a complaint can be filed in any of the district forums in whose territorial jurisdiction, any railway station lies on the particular route. Hence the railway’s argument that district forum has no jurisdiction to try case, as the goods were stolen at an unknown place during the complainant’s travel from Mumbai to Bangalore, was rejected outrightly by the State Commission. It also observed that under Sec 4 (2) (b) the complainant is entitled to file a complaint before any of the district forums, at Mumbai.
Claims Sholapur, Bangalore or any other place enroute, the Railway’s also contended that Sec 15 of the Railway Claims Tribunal Act prohibit any Court or authority entertaining claims arising out of matters covered under Sec 13 of the Act. The State Commission rejected the contention and observed that Sec 13 covers loss, destruction, damage deterioration or non delivery of goods or animals entrusted to the railway administration for carriage by railways. The State Commission observed that the goods lost in the case in hand were not entrusted to the railways, as described under Section 13, but hand luggage which was stolen while the train was moving. The State Commission rejected the contention of the railways and observed that the district commission was competent to entertain the complaint and Railway Claims Tribunal Act has not taken away jurisdiction of the consumer Forum to try and decide such claims. The judgment of the State Commission as brought a sigh of relief to all those who lost their baggage during travel in trains. The technical objections raised by the railways are rejected by the consumer state commission. The railways are liable to make good the loss to the passengers.
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Remain covered till hundred LUDHIANA:
The insurance sector has never given so much importance to the needs and requirements of a post retirement life as it is does today. As compared to plans that culminated almost coinciding with one’s retirement, longevity has altered the way insurance companies do business today. One can therefore live to 100 and still remain insured till then, with terminal amount going to the spouse or any other nominee. These “whole life plans” as these are termed continue to cover the policy holders life much beyond the normal 65 or 70 age limit of most hitherto existing life insurance policies. MetLife India has come out with whole life policies that provide a cover till a person completes a century.
MetLife MetLife offers Met 100 Gold, Met 100 Platinum, Met Gold (Endowment) and Met Junior (Endowment) coupled with four riders — the accidental death benefit rider, waiver of premium rider, critical illness rider and term rider. These riders are available to in various combinations for customisation of a policy. The company claims to offer over 300 potential options to a customers who wants to cover his / her life for as long as they live. Besides providing a long-term protection, whole life plans from MetLife promise that your savings grow by way of compounded annual bonuses. The Whole Life Plan also provides a guaranteed death benefit in addition to building up the cash surrender value. Both the Met 100 Gold and Met 100 Platinum are participating plans, while Met 100, is a non-participating plan. Met 100 Gold and Met 100 Platinum plans come with face amounts of Rs 50,000 to Rs 4,99,999 and Rs 5 lakh and above.
Beyond retirement The objective of a whole life plan is simple says company representatives citing an example that goes as this “suppose at 35 you were to buy a endowment plan for 25 years. When you turn 55, there will be money but no life insurance. Most likely at that age no insurance company would be willing to insure you either. This is where a whole life policy comes into play, by providing cover all through your life”. This argument has begun to make more sense to all those who hope to live longer than their ancestors and feel that they would like to leave some monetary benefits to the persons who have looked after them in their old age.
Premiums The Met 100 Gold and Met 100 Platinum are more affordable than the earlier Met 100 offered by MetLife as the premium rates of these two whole life plans are much more easy on the policy holder than the earlier plan.
Loan option Met 100 Gold and Met 100 Platinum can be surrendered after premium has been paid. The insured can take loan up to 90 per cent of the surrender value. Riders like accidental death benefit, term, waiver of premium and critical illness can be added to the basic plan at a very nominal cost. MetLife India Insurance Company Private Limited was incorporated in India on April 2001 as a joint venture between MetLife International Holdings Inc., The Jammu and Kashmir Bank, M. Pallonji and Co Private Limited and other private investors and is headquartered in
Bangalore.
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by R.N. Lakhotia Tax queries Q: The following are my queries: 1. My mother earns 95000 per year as post office and LIC agent. I want to know whether her income will be computed under salary or business head and is she eligible for standard deduction under income tax? 2. I want to further know that what are the account books she had to maintain for the income tax purpose and what are expenses and incomes that can be shown in the books and if there is any minimum or maximum level of these? 3. If the salaried person should maintain books for the income tax purpose if yes, what are these books. — Sanjiv Singla, Bathinda Ans: The income of your mother would be calculated under the head “Income from business or profession”. As this income is not salary income, no standard deduction would be permissible. She would be entitled to all legitimate expenses incurred to earn the commission income. There is no limit for maximum and minimum level of such expenditure. Under the law there is no requirement for the salaried employee to keep books of account. Tax liability Q: At present an income of interest on MIS, FDR, Saving A/C etc. upto Rs 9000 P.A. is exempted from income-tax under Section 80L of I.T. Act. Is the income beyond Rs 9000 under the section is taxable even if the main income of a person does not fall under the tax limit. Please clarify the matter from the following date. Suppose my pension income is Rs 80,000 P.A., income from MIS, FDR & bank deposits etc. is Rs 20,000 and I deposit Rs 25,000 in PPF. What would be my I-Tax liability in this case. — T.R. Goyal, Chandigarh Ans: Please note that at present the exemption u/s 80L is to the tune of Rs 12,000 P.A. and not Rs 9,000 P.A. In addition to this figure the sum of Rs 3,000 is exempted u/s 80L on account of income from Government securities. On the facts stated by you there would be no Income-tax liability on you because you are also going to invest in PPF to avail yourself of the tax rebate. Tax exemption Q: I am doing Doctor of Medicine i.e. M.D. at Government Medical College, Amritsar. I get Rs 12,500 p.m. as stipend. Regarding my Income Tax assessment, please clarify the following, expenses (how to be accounted). Please mention the rule or section of Income Tax Act applicable for exemptions:- (stipend — which I get is during the residency i.e. M.D.) for 3 yrs. 1. College fee for studies. 2. Hostel fee for boarding and lodging. 3. Thesis work expenses. 4. Expenses for books for studies. 5. Stationery expenses for studies. 6. Other expenses for example — computer charges, Internet charges, photostat expenses, photography expenses, data collection expenses and related travelling expenses (scooter expenses etc.) 7. Expenses for journals and other latest publication in field of my P.G. course. — Dr S. H. Gupta, Amritsar Ans: The stipend amount received by you would be taxable as income. You will not get any deduction for these expenses as your stipend (and not scholarship) is perhaps in the nature of salary income. Please read carefully the terms of granting stipend. |
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Cummins prospects satisfactory Q. Please comment on the prospects of Cummins. — Saranjeet Singh , Sangrur Cummins India Limited manufactures a variety of engines (60- 2700 HP) operating on diesel, natural gas and dual fuel, for the widest range of applications: power generation, construction and mining, compressors, locomotives, marine, oilfields, fire pumps and cranes, automotive and special applications. Starting in India at Pune in 1962 (as Kirloskar Cummins Limited), Cummins India Limited has pioneered diesel engine technology to meet the diverse power requirement of the country and region. Today, Cummins powers hundreds of installations and equipment in India, Nepal and Bhutan. The company is fully geared up to meet the bullish environment expected after the slump. Cummins may look forward to brighter days ahead since it has been selected as the hub for outsourcing components, such as camshafts and fuel pumps by the parent company, Cummins Inc, USA. However, it could take some time for results to show. For the fiscal ended March 2002 sales were Rs.745.2 crore, PBIDT was 17.2 per cent, net profit was Rs.77.5 crore and the EPS was Rs.3.9. For the quarter ended September 2002 sales were Rs.179.4 crore, PBIDT was 18.8 per cent and net profit was Rs.17.5 crore. Overall, the prospects of this company appear quite satisfactory.
Q. Should I hold or sell the shares of Essel Propack. — K. Bhalla, Kurukshetra Essel Propack (earlier known as Essel Packaging), a virtual monopoly player in the Indian lamitubes industry, became the world’s largest lamitubes producer in November 2000 following its takeover of Propack in a $50 million stock-cum-cash deal. The company’s Vision 2005 growth plan (80 per cent market share each in China and India and overall 50 per cent market share of the global lamitubes industry) though a challenge in itself can be achieved going by the management’s past track record of Vision 2000 plan formulated in 1995 to get globalised. The recent strategic alliance with US FMCG giant P&G should contribute to an 15-18 per cent increase in revenues and will increase Essel Propack’s world marketshare from 25 per cent to more than 30 per cent. Lamitubes is a high growth potential business and especially in the emerging markets where Essel Propack has already established strategic presence. User industries are largely FMCG and pharma OTC products that are generally recession proof. For the quarter ended September 2002 its sales were Rs.56.4 crore, PBIDT was 37.9 per cent and net profit was Rs.7.8 crore. To conclude, one could hold on to the shares of this company. |
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by Pushpa Girimaji Lawyers can be sued for deficient service Every time lawyers go on strike, cases are adjourned and litigants are adversely affected. Consumer courts too bore the brunt of such action by lawyers, till the National Consumer Disputes Redressal Commission put its foot down and said it would not condone non-appearance of lawyers on the ground that they were on strike. I do not know whether consumer courts at the state and district levels are aware of this, but that is the law as laid down by the National Commission last year and if it is not being followed by them, then consumers should remind them of it. In fact in this order on October 3, 2001, the apex consumer court came down heavily on strikes by lawyers and said consumer courts should not grant adjournment on the ground that lawyers are on strike. It’s relevant to quote here the Commission’s observations in this case: ( Ram Raksh Pal Gupta Vs Smt Ranjana, R.PNo 1051 of 2001) “…. strike (by lawyers) is a virus which should not be allowed to infect the Fora constituted under the Consumer Protection Act. It should never be a ground for adjournment in a forum under this Act that the lawyers are on strike. In the present case, we do not think the state commission took any serious note of the adjournment by the district forum on the ground of strike by lawyers” Said the Commission further: “It must not be forgotten that the Act is meant to provide speedy justice to the consumers.... We have to guard against this pernicious practice of strike by lawyers spreading to the Fora under the Act.... There is already public criticism that Fora under the Act are fast becoming civil courts where adjournments are granted as a matter of course. This should not be permitted, otherwise the purpose of the Act will be lost. State commissions should ensure that no adjournment is granted on the ground of strike by lawyers. If the lawyers do not appear before district forum or state commission, it can decide the matter on the basis of the record, if it so chooses. A request for adjournment on the ground of strike by lawyers is not justifiable ground for adjourning the matter” The apex consumer court also made it clear in this case that non appearance of a lawyer in a court or a tribunal or any authority, after being engaged and having charged his fee could constitute deficiency in service. In other words, in such a case, the consumer who has hired the lawyer can seek compensation under the Consumer Protection Act for any loss or suffering caused on account of such deficient service. In the case of Amritsar Haldi Sales Corporation vs the PSEB, decided on May 2, 2002, too the apex consumer court made it clear that it would not accept the argument that the client should not suffer for the fault of the lawyer. If there is such a fault, then the consumer has the option to file a case against the lawyer for deficiency in service and seek damages for any loss or suffering caused, the Commission said. Here, the complainant had pleaded for condonation of delay in filing an appeal on the ground that his lawyer had given him wrong advice. Rejecting such an argument, the National Commission said: “We cannot fall for the oft repeated argument that a client should not suffer for the fault of a lawyer. Why should he suffer? He can proceed against the lawyer for professional negligence on account of deficiency in service. We are a consumer forum where disputes are to be decided in a set time schedule”. Reminding the petitioner about the time limit within which cases are to be decided before consumer courts, the Commission said: “We do not want a consumer forum to become another civil court by accepting such specious arguments that there can be ‘no fault’ on the part of lawyer representing the client. We do not want to interfere with the order of the state commission holding that there was no sufficient cause for condoning the delay”. I must also quote here, the case of P.Krishna Rao and another vs Mandipalli Devaiah. Here, Mr Deviah had filed a complaint against lawyers before the District Forum alleging deficiency in the service provided by them. His case was that he had hired their service for a suit filed by him and the lawyers had taken an extremely inconsistent stand in the plaint drafted by them. Holding the lawyers guilty of deficient service, the District Forum had directed refund of the fees charged by the lawyers, besides payment of damages of Rs 1,000 and costs amounting to Rs 300 to the consumer. The state commission had upheld this order. The National Commission before which the lawyers had filed a revision petition, also held that there was deficiency in the service provided by the lawyers. |
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by J.C. Anand Sustained bull-rally buoys up the market Last fortnight, the stock market pushed up the Sensex from 3033.91 points to 3228.82 points, registering a gain of 194.91 points (6.42 per cent). This kind of bullish flavour has come to the market after a very long time. In fact, on almost all the working days, the market moved up. There was no profit-taking except in a minor way, when the Sensex was down by about 12 points. Last fortnight, it had been stated in this column that the market had bottomed out and it was the time to pick up good blue chips. But I had expected the market to bloom only in January, 2003. This fortnight, there may be some profit booking. But even after this profit-booking, the market is likely to keep its upward momentum. There was also some good news for the stock market. The Parliament converted a number of ordinances, issued earlier into law (subject only to President’s signature). This included the Securitisation and Reconstruction of final assets and enforcement of security interest bill, 2002, which will enable the banks to seize and sell the assets of defaulters, without getting involved in prolonged court cases. The Parliament also strengthened SEBI by empowering it with a greater power over the corporate sector. The UTI had already been bifurcated into two sectors by ordnance and now this ordinance too has been approved by the Parliament. The Securitisation and Reconstruction Bill (when the President’s signature is given to the Bill), will greatly strengthen the banks and their loans to the defaulting agencies will be easily recovered. Already the banks have taken over a Mardia Chemical unit under the NBA Ordinance. There are reports that Modi Rubber has also been asked to repay its loans. There are huge arrears to be recovered from tax defaulters as well as corporate defaulters, who are sitting over advances from banks and financial institutions. This legislation will no doubt improve the working and financial position of both the banks and the financial institutions. It is expected that the market would rerate the bank and financial institution scripts in terms of higher market price levels. Now that the bank deposit rates have been scaled down already by the State Bank of India and other banks. Long term investment in banks and financial institutions scripts should be both safe and rewarding. The State Bank of India has revised its interest rate on deposits from 7.11 per cent (for deposits for three years and above) to 6.5 per cent. Similarly interest on deposits (for one year or less than two years), has been cut down from 6.13 per cent to 6 per cent. There is bound to be greater flow of funds from the banks to the stock market and mutual funds. There is also a good news regarding hotel scripts. According to a report, luxury hotels in Goa, Kerala and Rajasthan have seen an improvement in their performance in the last two months. The occupancy level has been in the range of 80 per cent to 85 per cent. Hotel scripts should also attract investment in the coming weeks. Larson & Turbo has moved into some kind of legal jam over Grasim’s investment in Larson & Turbo shares. Demerger of cement sector from L&T appears to be a distinct possibility. There may not be immediate rise in the share price of L&T but those, who hold these shares, should not sell them. The company has a bright future in terms of its growing construction infrastructural, engineering and cement business. There is also a good news for Chandigarh. Infosys Technology has now finally decided to inject Rs 200 crore over next five years to set up a Software Development Centre in the up-coming Chandigarh Technology Park. Initially, it would invest Rs 30 crore in this venture. Another important news is that JCT is taking over the nylon yarn plant of Baroda Rayon. This would make JCT as a largest nylon textile yarn manufactures in the country. Hindustan Inks has also been in the news last week. The stock has gained 30 per cent and there has also been sharp rise in trading volumes in the last three days. One market rumour is that a multinational company is likely to take it over. Another rumour is that Hindustan Inks has bagged an order worth Rs 200 crore. It is not clear which of the two rumours is correct. But the fact remains that the market price of the script has moved up substantially. The multinational pharma shares like Glaxo, Pfizer, Aventis, Novartis are available in the market at reasonably low rates. When the patent law comes into operation in 2005, these scripts will simply sparkle with their market price doubling up. It is time to invest and retain them for another two and a half years. |
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FIIs net
buyers in equities Mumbai, December 1 Mutual Funds (MFs) were net sellers in
equities at Rs 339.35 crore and netted purchases in the debt market at
Rs 2,062.4 crore for the period under review, according to the
information available with Securities and Exchange Board of India. FIIs
registered net inflows in equities on 13 trading days in the month
while they remained away from the debt market on 17 days. On November
18, the foreign funds bought and sold equity instruments to the tune
of Rs 328.8 crore and Rs 144.9 crore respectively, thus netting
purchases of Rs 183.9 crore ($ 38 mn), the highest for the month.
They also recorded net inflows of Rs 114.3 crore ($ 23.6 mn) on
November 6 and Rs 89.5 crore ($ 18.5 mn) on November 1. PTI |
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Canara Bank Bangalore, December 1 |
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