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FM, Aiyar meet PM
Exempt IT services from tax: industry
India offers to host G-20 meeting
Canindex mutual fund within a month
IT noose around Big Bull Ketan Parekh |
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Corporate news
Telecom snippets
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FM, Aiyar meet PM
New Delhi, June 14 Mr Aiyar indicated that few more rounds of consultations might be required before arriving at a final decision on the issue. “The Finance Minister and I met the Prime Minister, but further work on the figures submitted is required,” Mr Aiyar told newspersons. The government is believed to be considering a fresh pricing policy in the wake of high volatility in crude oil prices in the international market. Sources said the new policy was likely to involve a reduction in customs duty on crude oil to enable oil-marketing and retailing companies to cushion the impact of high crude oil prices. Moreover, the government was expected to come out with an oil price stabilisation fund and fix price band between which the oil companies would be given the autonomy to fix prices in conformity with world prices of crude oil, they said. Officials of the Finance and Petroleum Ministry are working out the resultant impact of customs duty reduction and subsidy enhancement in respect of LPG and kerosene. “We will then go back to the Prime Minister for further consultations and will let you know of the decision as soon as we arrive at one”, Mr Aiyar said. Some of the measures being discussed in the new pricing policy may eventually be announced in the Budget, which is expected in the first week of July. Meanwhile, the major supporting parties of the Congress-led UPA government are learnt to have given nod for a moderate hike in petrol and diesel prices. Prices of petrol and diesel have not been revised since December 31, 2003. India’s oil demand grew by 10 per cent in May this year to reach a level of 8.326 million tonnes primarily driven by rise on diesel consumption. Diesel demand surged 13.6 per cent to 3.531 million tonnes as opposed to 3.109 million tonnes in the corresponding month of the previous year.
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Exempt IT services from tax: industry Chandigarh, June 14 “The government can pitch in a few areas. First, it should continue with a liberal tax regime and subsidy on all software and services exports, as this is necessary for the industry to grow rapidly and have a major advantage in the global market. Second, it needs to further simplify and lower barriers to imports of capital equipment and tools required to deliver high-end software services,” says Dr Santanu Paul, General Manager (Operations) from Bangalore-based Virtusa India Pvt Ltd. The company is a subsidiary of
Masschusetts-based Virtusa and has plans to invest $ 12 million in Chennai. Dr Paul adds, the government, most importantly, should invest heavily in creating and supporting high-quality national educational institutes that can create large numbers of well-trained software professionals that have both hard and soft skills. “This is particularly critical given that we are headed for a shortfall of professionals in the next few years,” he thinks. Mr R.
Natarajan, vice-president, Finance, Tavat Technologies, says STPI regulations should be made easier and the government should move towards currency-full convertibility. Service tax should be clarified on the services and IT services should be exempt very explicitly. “The government should clarify on the applicability of 10A provisions so that each IT assessing officer doesn’t take his or her own presumption and pass orders. Similarly, infrastructure development should be the priority to attract the investment in IT industry,” he adds. Commenting on the recent upheaval in the stock market vis-à-vis IT stocks, Mr Natarajan asserts FDI regulations should not change for a period of three years so that the FIIs gain full confidence on government policies and boost foreign investments. “Dividend tax and interest on small savings should be addressed straight away,” he adds.
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India offers to host G-20 meeting New Delhi, June 14 Commerce and Industry Minister Kamal Nath made the offer during a bilateral meeting with Brazilian Foreign Minister Celso Amorim in Sao Paulo. An official release said that both the Ministers underlined the need for consolidation of G-20 on major trade issues, particularly agriculture. G-20 was formed ahead of the WTO Ministerial meeting in Cancun last year and includes countries such as China, South Africa, Argentina, Egypt, Malaysia and Indonesia among others. Mr Amorim said G-20 grouping was a strategic alliance and never had the developing countries participating as actively or were perceived as such as active players in impacting the agricultural negotiations in the WTO as also the public opinion.
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Canindex mutual fund within a month Chandigarh, June 14 This was disclosed by Mr A.R Ramanujam, Managing Director of Canbank Investment, while addressing a press conference here today. With a view to focusing on strong retail base, the company had decided to strengthen its investor relation centres at 15 places in the country in terms of logistics, man power, etc, he said. Mr Ramanujam said Canbank mutual fund, which has an investor base of 2.25 lakh, had 14 open-ended schemes and one close-ended scheme. Mr Ramanujam, who was in the city to address the investors during an awareness programme, said investors had turned to mutual funds due to fall in the interest rates of banks. Canara Bank has taken up the distribution of these mutual funds
in Amritsar, Ludhiana and Chandigarh.
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IT noose around Big Bull Ketan Parekh
New Delhi, June 14 The Central Board of Direct Taxes (CBDT) estimates the total demand raised in Ketan Parekh group cases at Rs 1,365.37 crore and the interest on it amounted to another Rs 41 crore, according to the second action taken report submitted by the Finance Ministry in Parliament. “The gross demand comes to Rs 1,406.37 crore. Out of this, there has been collection and reduction in appeal to the tune of Rs 21 crore. Hence, the total outstanding demand in the Ketan Parekh group cases is Rs 1,385 crore as on May 28, 2004,” says the report drawn up pursuant to recommendations of the Joint Parliamentary Committee that probed the share scam. The slapping of the notice comes after the IT Department’s searches conducted on Ketan entities soon after the scam surfaced in March, 2001, and completed investigation by October, 2003. The CBDT assessed undisclosed income of Ketan entities at Rs 1,993.26 crore raising tax demand of Rs 1,365.37 crore.
— PTI
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EU squeezes Indian Basmati
New Delhi, June 14 The world’s largest trading bloc also wants the samples of imported Basmati drawn from Indian consignments to be tested here itself free of cost. “From April 15 we are certifying cargoes as traditional Basmati, for them to be able to avail the benefit of 250 euros a tonne duty concession. EU now wants even the specific variety of Basmati be identified in the carton itself,” Chairman,
Agricultural and Food Products Export Development Authority Chairman K S Money said. He said customers were more interested in traditional basmati and to identify one of the six varieties to which a cargo belonged was not required.
— PTI
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Corporate news
Mumbai, June 14 Infosys Board also approved the issue of bonus shares on the company’s equity shares in the ratio of 3:1 i.e.. three additional equity shares for every existing equity share held by the members on a date to be fixed by the Board, by capitalising a part of the general reserve account. The members also approved a stock dividend on the company’s American Depositary Shares (ADSs) in the ratio of 2 for 1, ie one additional ADS for every one existing ADS held by the holders of the ADSs as on a date to be fixed by the Board. Also the ratio of converting ADS into equity shares is fixed at one equity share for one ADS. Informing this to BSE, the company officials said that the record date for issue of bonus shares is July 2, 2004. HSS open offer
Flextronics International has priced its open offer for 20 per cent of the paid-up equity capital of Hughes Software Systems at Rs 548 a share. The offer price to the public shareholders is a rupee higher than what Flextronics paid for a share of face value of Rs 5 for acquiring 54.95 per cent stake of promoters of HSS, Hughes Network Systems (HNS). Flextronics paid a total of Rs 1021.1 crore for acquiring HSS from HNS, which is a fully-owned subsidiary of Rupert Murdoch-controlled DirectTV. As per guidelines of Securities and Exchange Board of India (SEBI), after the takeover of HSS, Flextronics had to come out with an offer to the public for acquiring 20 per cent stake amounting to 67,93,810 shares.
— Agencies
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Telecom snippets Seeks Rs 145 cr refund
New Delhi, June 14 In a letter to Department of Telecom (DoT), the Sunil Mittal-promoted company said: “We are surrendering fixed licences in four circles of Delhi, Haryana, Karnataka and Tamil Nadu.” The move comes in the wake of a change in the policy, which ushered in the Unified Access Service Licence regime. Bharti has unified licence in all the above-mentioned four circles, which allows it to offer fixed as well as cellular services. According to officials, Bharti had paid Rs 145 crore as entry fee for acquiring these licences. BSNL’s plea
Being the only universal service provider in uneconomic areas, state-owned BSNL has sought exemption from contributing to the dedicated fund saying it should be reimbursed directly on the basis of cost incurred. BSNL has many times written to Department of Telecom that the current USO policy which seeks to reimburse BSNL after inviting tenders on competitive bidding basis for its rural network roll-out, needs to be amended so that BSNL could avail the reimbursement directly on the basis of the costs quoted in its open tenders, sources said. BSNL has written to the Telecom regulator TRAI also on the issue, they said.
MTNL
MTNL today reported a net profit of Rs 1,150 crore in 2003-04, up 31.16 per cent over Rs 877 crore booked in the previous year. The profit was made on a total income of Rs 6,684 crore, representing a 10.84 per cent increase over 2002-03, the company, which provides telecom services in Delhi and Mumbai, said in a statement on the audited results. Adopting the accounts, the Board of Directors today recommended a dividend of 45 per cent amounting to Rs 283.5 crore.
Hutch
Hutchison Max Telecom (HMTL) has filed with the Foreign Investment Promotion Board (FIPB) an application for the Hutchison Essar Telecom group of companies to consolidate its various telecom interests in India under a single entity.
— Agencies
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Chandigarh, June 14
