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Sunday,
March 23, 2003, Chandigarh, India  
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Punjab not to implement VAT
25 cr fine for insiders’ trading
IIM students offered Rs 5.64 lakh salary
Yellow metal loses sheen
In the wonderland of investment |
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Rationalisation
of air routes deferred
Compassionate
ground
Forex reserves near $ 74 b
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Punjab not to implement VAT Ludhiana, March 22 Clearly stating for the first time that VAT will not be implemented in Punjab from April 1, Chief Minister Captain Amarinder Singh said Punjab would impose VAT only after doing proper homework on the issue. "The finance department is working out various modalities and it would take some time before the new taxation structure is put into operation". The Chief Minister was answering questions shortly after inaugurating the Kisan Mela at the PAU here today. "The decision to impose VAT throughout the country has been taken at the national level, so no state can wriggle out of it. But unlike neighbouring states that impose VAT on April 1, we will not rush to impose it. VAT will be imposed in Punjab only after dispelling all apprehensions of the people", he said. The state government will conduct various seminars on VAT all over the state, consult business and industrial associations and seek their views about the proper implementation of VAT which is accepted as a superior form of taxation the world over, he added. However, refusing to elaborate on the time frame before VAT will be introduced , he said "the Finance Department is already appraised of the matter and VAT will be implemented as soon as the department gives a go ahead". The state government was taking all such measures that were essential to put back the state's economy on road. As a consequence, he added that no concession like free power to farmers could be restored at this juncture. “Before seeking funding from agencies outside the country it is mandatory for a state to stop all subsidies, therefore the question of restoring free power to the farm sector does not arise. However, once the states economy is back on rail the issue can be reconsidered”, he added. Captain Amarinder Singh accused the Union government of showing bias towards non BJP-ruled states saying that the Centre was doing nothing to help the agriculture sector in Punjab which was passing through difficult times due to lowering of MSP of wheat and rice while the cost of inputs like diesel fertiliser, etc was rising. He said since Punjab did not expect much from the Centre in terms of help, contract farming was Punjab's only hope. By 2005, 25 per cent of Punjab's cultivable area would be put under contract farming, the Chief Minister disclosed. After the Mahindras, the Tatas too have entered into an agreement with the state government in the field of contract farming, he said, adding that Tropicana of USA, too, had entered into contract farming with regard to kinnow plantation and experiments were being conducted to make crop diversification in the state a success. |
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25 cr fine for insiders’ trading Chandigarh, March 22 It will impose up to Rs 25 crore penalty or thrice the profits of the company, which ever is higher, for indulging in insider trading and up to Rs 1lakh per day penalty for not providing required documents to SEBI and investors, said Mr G.N. Bajpai, SEBI Chairman here today. Addressing investors, Mr Bajpai said SEBI had now evolved a mechanism of transparent trading at stock exchanges where investors could not be cheated by "fly by night" companies. SEBI has already taken hundreds of "dishonest" companies to the courts over the past year that has created a fear among the mischievous companies. Interestingly, a number of vanished companies have again surfaced after strict action against some of them. He agreed that at present there was no mechanism where the cheated investors could get their money from the vanished companies. However, if these were not suspended from the stock exchanges, they would further deceive other investors. Talking to the mediapersons later Mr Bajpai claimed that with the beginning of D-mat trading, about 40 lakh investors, 99 per cent of total investors, have shifted to electronic trading. It was more safe and transparent, than the previous physical trading of stocks. After the fall of interest rates, he said the regulator was trying to offer various products to the investors. These included futures, options, single stocks, trading in government securities and corporate bonds. As part of its efforts to improve corporate governance, Mr Bajpai said,‘‘We have put up a discussion paper on proposed code of conduct, developed by Mr N. R. Narayana Murthy Committee, on our website. The SEBI Board would take a decision within three months.” About regional stock exchanges, he said, “after the networking of BSE and NSE with hundreds of brokers in the country, they had limited options. Either they could merge with the BSE or NSE or could emerge as a third exchange through common trading.’’ Mr C.B.Bhave, Managing Director, National Securities Depository Limited, Mr Tejvir Singh from Bank of Punjab and Mr Sanjay Tandon, MD, Competent group, were also present |
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IIM students offered Rs 5.64 lakh salary Indore, March 22 With eight offers, Infosys led the corporate beeline that included Asian Paints, Pepsico India, Marico, Madura Coats, Airtel, Larsen and Toubro, Telco and Eicher Motors. HCL Technologies came a close second with seven offers, followed by Pepsi with five offers. The banking and financial services sector was led by ICICI with three offers. The highest salary dished out was Rs 12 lakh per annum and the average annual salary of Rs 5.64 lakh was much above the last year’s figure of Rs 4.97 lakh, the IIM (I) placement cell said. Altogether, 41 companies registered for the process and 64 jobs were offered to the students. In tune with the market trend, 38 per cent (22 students) got jobs in the field of marketing while 18 students were absorbed in the systems section. Another 15 students secured jobs in finance and only two got jobs in the human resources section.
UNI
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Yellow metal loses sheen
New Delhi, March 22 The yellow metal in international markets plunged last evening to a lowest level since early December as hopes for a quick end to the fighting in Iraq. Trading sentiment in gold depressed as most of the funds were diverted toward equity markets which gained fresh ground to hover around this year’s high levels, pushing gold to be traded around $ 325.10 an ounce. Activity in silver was
equally weak and it surrendered notable ground in the past few trading sessions. Standard gold and ornaments fell further by Rs 90 each at Rs 5250 and Rs 5100 per 10 gram respectively. Sovereign also declined by Rs 25 at Rs 4,375 per piece of eight gram.
PTI |
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In the wonderland of investment Q: In nineties you used to advise contribution to PPF of as much as possible, subject to the ceiling. Now, you are saying that tax-saving bonds of ICICI are better than PPF. The interest received on PPF is tax-free while on TSBS it is taxable (specially when it crosses 80L limit). Also TDS is applicable on TSBs & it is difficult to get refund from ITO. In view of this. I would like to know why you still prefer TSBs.
Bipin I. Shah A: This query has surfaced at my table many times. My observation was addressed to all those who find that they cannot afford to contribute to Sec. 88 to the hilt since they need the money for their day to day expenses. The advantage of the rebate is so very heavy that one should contribute up to Rs 1 lakh (or so much as brings their tax to nil level). Such persons should beg, borrow or steal and contribute to TSBs only for 3 years, if such contribution attracts the tax rebate. Thereafter, it becomes a self-sustaining scheme. If you can afford to contribute the full amount without affecting your life style, you may go in for PPF. I am afraid, you are not keeping in touch with my articles. When interest rate was reduced from 12 % to 11%, I advised my readers to withdraw from PPF as much as possible, as soon as possible and go to pure-growth, open-ended, debt-based (PODs) mutual fund schemes. The current rate of PPF is 9 % and the MF’s is over 12% tax-free (= after-tax). However, I foresee that in the near future, the POD returns would nosedive and therefore, I have started advising not to withdraw from PPF any more, unless the amount if required for catering for some need. I am afraid, the coming Budget will reduce the PPF rates further. In that case, I will once again reverse my stand. I move with time and this is the best benefit I can pass on to my readers. Persons like you who have read a piece of mine in 1990 and have been following my advice for all the time until now may have hurt themselves badly. Q: I had sold a flat and booked a long-term capital gain of Rs 15 lakh in 1999. I had invested the amount of gain in 97,500 units of UTI US-64 with a lock-in period of 7 years for saving tax thereon. A couple of days back I read that the government will offer tax-free bonds to the holders of US-64. What will be the tax implication if they convert the units to tax-free bonds. My purchase price was Rs 14.50 per unit. The government will convert the units at Rs 10 per unit. What about this long-term capital loss that I may incur. Sunil Kapoor A: In May, 03, the US-64 certificates or statement of accounts will be submitted the UTI. Each certificate will automatically be construed as the tax-free bond of 5-year tenure. Bonus bonds at 1:5 will be issued to all up to a holding of 5,000 units. The deemed conversion of units into bonds will not be construed as a transfer for the purpose of capital gains. Those who need liquidity, can sell the bonds in the market before the term. Capital gain/loss will accrue only on the sale of the bonds or at their redemption. This structure allows you to hold on to your investment for the mandatory period of 7 years required u/s 54EB. The interest rate on the bond will be declared in May 03. Q: I am a US citizen and live in the USA, but I like to invest in FCNR in GBP. Is the interest taxed in India? And at what limit is it tax-free in India? I know it is reported in the USA. Also if you get rental income in India, is it taxed and what amount? Jayshree A: Are you a person of Indian origin? If you are, you may open an FCNR/NRE account in India in any foreign currency of your choice. ICICI Bank does not have to report it to any US authority. The interest from both is tax-free in India. There is no ceiling on the investment amount. If you have rental income it’s taxable in India as normal income. There are certain deductions allowed against income from house property. This income is repatriable after tax is paid or provided for thereon. |
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by K.R. Wadhwaney Rationalisation of air routes deferred RATIONALISATION
of routes on the international sectors has once again been put on the hold because two national carriers are on different wavelengths. This is because politicians and bureaucrats have different ideas. As a result, the rationalisation route plan, if at all, will be taken up only when new aircraft are bought. This will not happen at least until 2005. In other words, the same situation will obtain in the two national carriers. Until new aircraft join the ageing fleet, Air India will be dependent upon the dry leasing of aircraft since wet leasing is beyond the scope of affordability of the airline. The picture in buying new aircraft soon is not very rosy because two world’s leading manufacturers, Boeing and Airbus Industrie, are involved in their internal, intense competition. To promote their respective aircraft, politicians from France and the USA have been endeavouring to influence the Indian politicians. As a result, the exercise of buying aircraft becomes more political than a commercial function. Cosmetic changes The duty-free shop at the IGIA has been upgraded and renovated. This is great. But this is a cosmetic change until the ITDC takes concrete measures to improve its image
worldwide. There have been complaints of corruption against the duty-free shop, besides spurious stuff being provided to the passengers. |
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by Praful R. Desai Compassionate ground Q: When ceiling of vacancies fixed in scheme for compassionate appointment is exhausted, can Court compel the department to relax the said ceiling? A: This point was considered by the Supreme Court in Union of India v Joginder Sharma as under. On respondent’s father’s death, she claimed compassionate appointment in Noida Export Processing Zone. This request could not be complied with the percentage reserved therefore having been already exhausted. The Tribunal as well as the high court in the opinion of the Supreme Court seem to have fallen into great and same error. The reasons assigned by the court to reject the challenge made by the appellant seem to be no reason in the eye of law, apart from they being totally oblivious to the very stipulations in the scheme and the very object underlying the scheme of making appointments on compassionate grounds. Where the question of relaxation is in the discretion of an authority in the government and not even in the realm of any statute or statutory rules but purely administrative and the authority as a matter of policy decline to accord relaxation. The two factual instances, sought to be relied upon, on the behalf of the respondent, have been properly explained by the appellant to be not really and in substance a deviation from the general policy not to relax so far as to alter the ceiling and create more than the stipulated number of vacancies, to appoint persons on compassionate grounds. For all reasons stated above, the
Supreme Court held that the order of the Tribunal as confirmed by the court cannot be sustained. The appeal that way was allowed and the orders of the court affirming the directions issued by the Tribunal were set aside. |
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Wrong number The buzz is that the final countdown for MTNL has commenced with Reliance Infocomm now training its sights firmly on capturing its captive client-base in the major metro. Any takers?
Last hurrah The grapevine is abuzz with rumors that the ongoing quarter might turn out to be the last hurrah for the IT market favourite, as its nemesis, a larger IT giant is slowly but steadily eating into its business.
True or false Another IT pivotal, a Cyberabad special, is on a losing streak at the bourses since many trading sessions and it is understood that many investors, including institutional ones, are offloading their shares. The buzz is that there will soon be a spate of negative news shortly.
PSU option A veteran fund manager opines that at the current level of around Rs 280 this stock could be a prospective value buy as the government might have no option but to offset its losses on the oil pool front in the post-war scenario by way of disinvestments. |
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Traders meet PNB stake Sell-off proceeds VAT protest Hero group KLM flight |
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