 |
Monday,
March 24, 2003, Chandigarh, India  
|
More cuts in AC, PC prices expected
Consumer courts now get teeth
Q: I am a Punjab Government pensioner while calculating the rebate (u/s 88), which ground (Gross or taxable income) to be considered. Let me know the rate of surcharge (either 2 per cent like previously or more) for the coming assessment year (2003-04). r |
|
|||||||||||||||||||||||||||
|
Hold on to HDFC Bank shares
Nahar Spinning, L&T good pick
|
|
More cuts in AC, PC prices expected In the post-Budget scenario, the dealers are facing queries of consumers to buy airconditioners, branded computers and other consumer durables. While some manufacturers have already announced a price cut to boost their sales, others are, perhaps, waiting for the impact of the Iraq war on their costs. While the edible oil industry was prompt to pass on the yet to be implemented 8 per cent excise duty on branded and packed edible oils, but some airconditioner manufacturers and assembled computer manufacturers are still showing their reluctance to bring down the prices. Fall in AC prices
The cut in excise duty on airconditioners from 32 per cent to 24 per cent had raised hopes in the market that it would encourage the manufactures to slash prices by Rs 1,500 to Rs 2,000 per model. But some firms claimed that since they were already working in the zero excise duty zones, like Jammu, Aurangabad, Noida and Guwahati, it was not possible for them to respond positively. But due to market pressure and in order to meet their annual sales targets, say dealers, they have slashed the prices. Says a dealer here,‘‘ We are offering discount of Rs 1,000 to Rs 2,500 on the purchase of a Samsung or LG airconditioner. A Samsung airconditioner (1.5 tonne), which was available at Rs 19,990 last season, can be purchased now at Rs 18,500. Besides a zero per cent interest rate scheme is also available. Similarly, the LG ( LW-N 1860 BCI model) airconditioner, that was sold at Rs 21,200 previously, is now available at Rs 18,490.’’ Another Samsung dealer in Sector 22 feels that companies have so far not slashed the prices to the desired extent. At present they were concentrating on the sale of CTV during the World Cup. But in the summer, they will have to slash price of airconditioners and refrigerators as well even by cutting down cost of production or profit margins. He says Samsung had come up with the ‘‘Samsung Rang De Kismat Offer’’ campaign. It will enable customers to win lucky gifts worth Rs 4 crore, on the purchase of any Samsung frost-free refrigerator till May 31. The scheme on airconditioners is expected to be announced any time. The Videocon is also expected to announce a bonanza for its customer on April 2, he added. Due to a cut in peak import duty rates from 30 to 25 per cent, the prices of branded refrigerators may come down further. The prices of 250-litre Samsung refrigerator is already down from Rs 16,000 to Rs 15,000, besides lucky draw schemes and zero finance offer. Companies will have to further reduce their prices if they want to gain volumes in the market. Right time to buy used car
Most of the car manufacturers, including MUL and Hyundai, responded immediately and slashed prices by Rs 20,000 to Rs 2 lakh on different models due to a cut in excise duty. Consequently, the second-hand car market was forced to cut down prices. A dealer disclosed that with Rs 1lakh, one can buy a Maruti 800 ( 1997 model), Fiat Uno( 1996), Tata Safari (1995) and Maruti Gypsy(1994). He said,‘‘ The price are down by Rs 15,000 to Rs 25,000 per model on an average, depending upon the need of the seller and the condition of the vehicle.’’ Want to buy a computer?
The Finance Minister's decision to reduce the peak custom duty rate was also expected to result in a fall of prices of branded PCs and other IT products. While the Zenith has announced a cut of about Rs 2,000 on Intel Pentium 4 processor 1.6 GHz and other models, the other manufacturers have still to respond. Says a dealer,‘‘
Though the companies are making huge profits but they have yet to pass on the Budget benefits. Even companies, which are claiming a cut in prices, have introduced installation charges up to Rs 2,000 to deceive the customers. However, with the Iraq war and other factors, they may be forced to revised their rates sooner than later,’’ he added |
|
Consumer courts now get teeth
Consumers now have another reason to celebrate March 15, besides the World Consumer Rights Day. The comprehensive amendments to the Consumer Protection Act, which herald sweeping changes in the functioning of the disputes redressal agencies constituted under it, have finally come into force from March 15 this year. For consumers who are demanding a stronger and a more effective law to tackle violations of their rights, it has certainly been a long wait. The law, first enacted in 1986, was amended in 1991 and 1993, but subsequently during the course of implementation of the law, several lacunae came to light. However, even though a committee constituted to suggest further amendments submitted its report way back in 1995, the amendments were introduced in Parliament only in 2001 and passed by both Houses in 2002.After receiving the President's assent on December 17, it was finally notified on March 10, bringing all provisions of the Act into force from March 15. The amendments essentially deal with two main aspects: First, the need to simplify, streamline and expedite the process of dispute resolution and second, the need to give the consumer courts more power to deal effectively with a wider range of violations of consumer rights. Accordingly, the amendments stipulate a specific time frame of 21 days within which the court has to decide the admissibility of a complaint. Similarly, it calls for cases to be decided within three months and where the complaint involves testing of a product, an additional two months are provided. The Amended Act prohibits adjournments during the course of hearing of the case. Where it is given in rarest of rare cases, the consumer court has to do so by a speaking order giving reasons for it. It will also have to award costs to the complainant for the inconvenience caused on account of such adjournment. The law also now stipulates that any party wishing to appeal against the order of the forum has to deposit 50 per cent of the amount that it has been directed to pay to the consumer. In order to tackle the increasing number of cases or appeals before state and the National Commission, the amendments provide for additional benches of the state and National Commission to be constituted. Keeping in view the fact that the work in many of the forums come to a grinding halt in the absence of the President or the judicial member, the amended law now allows the senior most member of the forum to act as the President in his absence. The courts can also now issue interim orders. Suppose a case is filed against a power supply undertaking for illegal disconnection of supply, the court can direct the service provider to restore supply pending final adjudication of the case. Or if a case is filed against a misleading advertisement, the court can issue an interim order directing discontinuation of the advertisement till the case is decided. Under the new law, the court can also award punitive damages. The new law also keeps out services hired for commercial purposes from the purview of the consumer courts. This is meant to prevent large companies from using the forums, meant for individual consumers, for settling their commercial disputes with service providers such as insurance companies, banks and power supply undertakings, thereby clogging the wheels of justice. Earlier, the law disallowed complaints pertaining to goods purchased for commercial purposes from being adjudicated before these courts. Now, such prohibition has been extended to services hired for commercial purposes too. The changes in the law also make way for stringent enforcement of the orders of the consumer courts. Where the opposite party fails to comply with an interim order, the consumer court can order attachment of his property. If a person fails to pay the compensation, the court can order its recovery in the same manner as arrears of land revenue. The amendments give the consumer court, the powers of a Judicial Magistrate for trial of offences under the Act. The amendments also give the consumer courts the power to deal effectively with unsafe and spurious goods. The pecuniary jurisdiction of the redressal agencies have also been
revised. While earlier, complaints where the value of goods or services and compensation up to a limit of Rs 5 lakh came under the jurisdiction of the District Forum, under the amended law, the District Forums have the power to deal with cases where such value is up to a limit of Rs 20 lakh. Similarly, the State Commission can deal with cases whose value is above Rs 20 lakh, but up to Rs 1 crore. The National Commission will deal with cases whose value is over Rs 1 crore. This change is aimed at taking justice to the doorstep of the consumer. In other words, since most cases come within the value of Rs 20 lakh, consumers need not have to travel to the state capital or to Delhi to file their petitions. |
ty
by R.N. Lakhotia Q: I am a Punjab Government pensioner while calculating the rebate (u/s 88), which ground (Gross or taxable income) to be considered. Let me know the rate of surcharge (either 2 per cent like previously or more) for the coming assessment year (2003-04). — Jagmohan Singh, Patiala Ans:
Tax rebate under Section 88 will be available @ 20 per cent or 15 per cent depending on the gross taxable income without considering the deductions permissible under Chapter VI-A of the Income-Tax Act, 1961. The rate of surcharge for the financial year 2002-03 relevant to assessment year 2003-04 is at 5 per cent. Q:
I am working in the PSEB. The electricity concession at 155 units per month is admissible to me as per my basic pay. The total billing amount of these units as per tariff of the board comes to Rs 362 per month. But by my D.D.O. have added Rs 502 per months as perquisites in my salary while computing my income on the plea that the manufacturing rate of electricity is 3.25 per unit. In the real life I am getting benefit of Rs 362 per month as concession whereas for this benefit perquisites has been added by my D.D.O. as Rs 502 p.m. Please advise whether computation of my salary by adding Rs 502 per month on a/c of electricity concession by D.D.O. is in order. A sum of Rs 5000 was invested by me in N.S.C during 8/96. Now N.S.C. of Rs 10,000/- is due for maturity. Please advise whether amount received by me on the maturity of N.S.C is taxable or not. Narinder Dewan , Patiala Ans: As per the new rules for valuation of perquisites from 1-10-2001 the value of the perquisite will be taxed in respect of electricity at the rate of cost of production of the Electricity to your employer. Hence, the amount added by your employer is correct. However, in case you are making payment of Rs 362 then this amount will be deducted before arriving at the perquisite value. In respect of repayment of NSC amount no amount will be added to your income. However, the income accrued in respect of the NSC will have to be taxed in different years. In case you have not declared the accrued interest in all these different years, then you may show the said interest in one year itself, namely the year in which the NSC got matured. Q: I am a Senior Citizen. My yearly income is about Rs 70,000 from all sources (Rs 62,000) from pension and Rs 8000 from interest from small savings). Kindly advise if I am supposed to file Income Tax Return? I have sold a piece of Agriculture land (ancestral property) measuring 20 kanals in December last year for Rs 6 lakhs. The land falls in my native Gobindpur village. Is this amount is taxable? —S.S. Gobindpuri,
Jalandhar Ans: In case you do not fulfil the any of the economic indicators (excluding house property), then you are not required to file your income-tax return because your net taxable income is below the exemption limit. In respect of sale of
agricultural land, you will be required to make payment of Income-Tax in respect of long-term capital gain after taking advantage of cost Inflation Index. If you buy agricultural land then you can save tax on this income. |
cr
Hold on to HDFC Bank shares Q. I hold shares of HDFC Bank. Should I hold or sell the same? Manjit Sotta, Patiala HDFC Bank’s excellent performance has long been discounted by the stock market. The driver of growth in bank stocks has been the new foreclosure law, and HDFC Bank, with net non-performing assets at a mere 0.7 per cent of customer assets, is not going to be a major beneficiary of the new rules. HDFC Bank’s retail loans now form 27.1 per cent of gross advances, compared to 23 per cent at the end of the first half. But profits from retail banking were only 16.9 per cent of total profit before tax, compared to 24.7 per cent during the first half of the year. For the fiscal ended March, 2002, sales were Rs 2037.1 crore, PBIDT was 67.3%, net profit was Rs 297.6 crore and the EPS was Rs 10.6. For the quarter ended December 2002 sales were Rs 646.3 crore, PBIDT was 70% and net profit was Rs crore. One could thus hold on to the shares of this company for now.  |
|||||
Nahar Spinning, L&T good pick During the last week the stock market turned around from a period of short decline to an unexpected spurt in share prices. The sensex gained 4 per cent in three days. NSE Nifty also appreciated in the same way. The stock markets in India were not alone in its turnabout from a bearish to bullish move. Many other asian markets also did the same. Even on Saturday when stock markets opened for 2-hour session, both Sensex and Nifty were up. The main reason was that the operators expect US-Iraq war to end soon as there was little resistance from the Iraqi forces. The settlement consideration was another reason for the Indian stock market to bounce back as operators could gain from higher share prices in their settlement deals. From April 1, the stock market will adopt T+2 system of settlement norm in place of the present T+3 settlement rule. This may create some operational problems for brokers and traders for a short period. The brokers will be able to adjust themselves to this change in a few weeks’ time. In the long run it will be a gain for investors. In a bullish phase during the last week the gainers were the PSU banks, IT and steel sectors. Losers were HFCL, EHI, Dabur, Gujarat Gas, Novartis and ITC. In case the US-Iraq war ends soon, the stock market will maintain its buoyancy but the impact of even a short war on the global economy will be bad. The US economy will have to pay for its war expenditure as well as for the anti-US sentiments this war has generated in many countries of Europe and Asia. The Indian economy will suffer in its exports business as well as due to the impact of slow-down in the US economy. For those who are allergic to investing in the stock market, the best option will be to invest in 6.5 per cent tax-free bonds, which will be open for investment. PPF, even with a lower interest rate, is good for investment. Those who prefer to invest in the stock market have an ample choice to invest in scrips which will give them 7 per cent plus net return which will be tax-free in terms of the Budget provision for the next financial year. Mastershare, quoting around Rs 10.50 provides 9 per cent plus return to those who invest in it now. The dividend of 10 per cent is likely to be paid in October. Some other shares in the textile sector are also good for investment with 7 per cent plus-return. Nahar spinning (around Rs 65 per share and a dividend of 50 per cent or so) and Mahavir Spinning (around Rs 60 and a dividend of 42 per cent last year) give a return of 7 per cent-plus. In spite of the fact that cotton crop is lower and will affect the profitability of the textile this year, these two companies, however, are expected to maintain their last year’s dividends, and are safe investments. Tata Chemical at Rs 62 per scrip and a dividend of Rs 50 declared last year (and likely to be repeated this year) is also a good investment. Larsen & Toubro is another company which is expected to maintain its profitability and its share is bound to appreciate from its present market price of Rs 190 per scrip. It has also received a number of fresh orders amounting to thousands of crores. As SEBI has cleared Birla group (Grasim’s) buy-back offer for Larsen & Toubro shares, it is expected that the Birla group will make fresh offer at a higher price now in its buy-back offer for Larsen & Toubro shares. In case the financial institutions (as is likely) agree with the Birla group plan to demerge the cement sector from Larsen & Toubro, even then the market price of Larsen & Toubro is bound to escalate. Larsen & Toubro is a risk-free and good investment. Its present management, however, is not very friendly to the investors. Another share which is expected to appreciate because of the expected buy-back offer is Novartis India. Its Rs 5 face value share is now quoting around Rs 226. It is a very sound share with a high dividend rate and a well-placed promoter which is an international pharmaceutical company. |
bb
Inflation zooms to 5.13 pc FII net buyers in equities Maruti cargo for Rs 2.22 lakh Meeting on EPF rate on March 28 |
 |
| Punjab | Haryana | Jammu & Kashmir | Himachal Pradesh | Regional Briefs | Nation | Editorial | | Business | Sport | World | Mailbag | In Spotlight | Chandigarh Tribune | Ludhiana Tribune 50 years of Independence | Tercentenary Celebrations | | 123 Years of Trust | Calendar | Weather | Archive | Subscribe | Suggestion | E-mail | |
Chandigarh, March 23