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Credit Information Act may be introduced
Lord Paul acquires five European steel cos
President A.P.J. Abdul Kalam speaks at the inauguration of the 24th India International Trade Fair (IITF) 2004 in New Delhi on Sunday. — PTI
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Biopark at Chennai in the offing
Dena Bank’s public issue soon
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Market scan
In-the-pipeline patent law makes pharma stocks jump
IT rules same for
all states
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Credit Information Act may be introduced
New Delhi, November 14 Among other things, the government is likely to introduce the Credit Information Companies (Regulation) Act, 2004, in the coming session of the Parliament. The Bill, once passed, would enable banks in making speedy appraisals and credit decisions while reducing financial frauds as banks may be allowed to share information on creditworthiness of borrowers. The government is also expected to bring about a Law, which will grant legal sanction for collection, sharing and regulated dissemination of credit information and setting up of credit information companies on the lines that exist in the USA, UK, Australia and Sri Lanka. In addition, a law on payment and settlement systems is also expected to be brought about. The Finance Ministry has said “preparing Indian banks for global competition will mean greater attention to regulation.” It will be necessary to enhance the regulatory capacity to ensure proper surveillance, enforce rules and develop the capacity to block banks and close them down before they become insolvent. The official line of thinking in this regard is that “from the task of protecting weak banks at the cost of public money, regulation will need to refocus on such issues.” At the same time, however, the government is keen on the phasing in the Indian banks to global competition, rather than opening up the floodgates for the global banking industry to swamp the domestic market. The premise, upon which the government is presently working, is that unlike the manufacturing sector, banks are ‘special’ and particularly vulnerable to systemic crises, as was seen during the East Asian currency crisis some years ago. “While providing a roadmap for opening up to global competition fully, we will have to fully simultaneously strengthen the national banks so that they are fully prepared to face competition. While the Indian banks aspire to become truly global players, they should also be prepared to face the full force of global competition on their homeground,” Finance Minister P Chidambaram said during the Bankers’ Conference here. Moreover, the government has made it amply clear while mergers and acquisition amongst banks will be market driven, “their footprints should cover the most interior rural areas and provide support to far flung sectors”. There are also a few tricky issues, especially on the credit front, which the government would be keen to plug at the earliest. While the Finance Minister has made it amply clear that the government was not “attempting to direct credit,” it remains to be seen how public sector banks would meet both the priority sector lending requirements as well as fulfilling the norms of the Basel II accord. The three pillars of Basel II, which offers a new set of standards for establishing minimum capital requirements for banking operations, are capital adequacy, supervisory review and market discipline. The second accord was prepared by the Basel Committee on Banking Supervision, a group of central banks and the bank supervisory authorities in the G-10 countries, which developed the first standard in 1988. This would involve adopting credit rating methods, a technique not certainly in vogue in India’s rural economy.
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Lord Paul acquires five European steel cos
London, November 14 The acquisitions, which will increase the group’s turnover by 25 per cent, include Britain’s leading manufacturer and distributor of precision steel tubing and assemblies, Tyco Tube, which employs over 800 persons and which has sales of approximately £ 83 million last year. It has eight factories in West Midland region. Another new addition to the steel empire founded by the Labour peer in 1968 is Tyco Strip, a leading international supplier of specialised cold-rolled steel strips, which are sold in more than 40 countries worldwide. The company had sales of approximately £ 36 million last year and employs 400 persons. Caparo did not disclose the cost of the acquisitions, as it is a privately held group controlled by the Paul family. The group’s steel manufacturing factories are located in the UK, USA, Canada, Spain and India, where it has set up several plants in the last two years. The other company whose takeover by the Caparo Plc, the principal operating division of Caparo group chaired by Lord Paul, was announced is Caparo’s competitor in industrial fasteners GKS-Centrepiece having sales of £ 5 million which, like Caparo, supplies products to automotive industry.
— PTI
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Aim to be MNCs, Kalam tells Indian industries
New Delhi, November 14 He also urged the Indian industries to think big with the whole world as our market, understand the strength of competitiveness and use ‘e-marketing’ concepts at grassroots level. “Indian industries should aim to become multinationals. Our youth love challenging jobs. We have to create challenging opportunities for them. We can win if we think we can win and act tenaciously with our clear goals in India to excel in a competitive new world and create India Brand,” Dr Kalam said inaugurating India International Trade Fair (IITF) 2004 at Pragati Maidan here. The President stressed the need for ‘creating brand institutions’ while noting that the IITF this year was on the twin theme of ‘Agriculture’ and ‘Information Technology’ which were both key drivers of India’s socio-economic development. China is the partner country while Brazil is the focus country this year in the IITF, which will continue till November 27. Referring to challenges facing the country, Dr Kalam said India would have to double its production to around 400 million tonnes of grains but this would have to be done under reduced availability of land from 170 million hectares to 100 million hectares with reduced water availability. There was also need to diversify to meet specific consumer preferences, export markets and in the interest of ecological balance through achievement access to all stakeholders without central controls or restriction of movement of agro products, he said. Dr Kalam said the challenge was to bring out innovative technologies available in farm equipment relevant to Indian conditions and work for development of seeds that would ensure good yield even under constraints of water with ecologically balanced farming. Dr Kalam also emphasised on the need to use e-marketing concepts at grassroots level to provide greater choices to farmers for selling and on using information technology to cover each every farm family through village panchayat knowledge centres, internet and community radio.
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Biopark at Chennai in the offing
Chennai, November 14 The Ticel (Tidco Centre for Life Sciences) Biopark, a facility with world-class design and standards for companies to nurture research and development has been set up here. According to Tamil Nadu Industries Secretary and chairman of the biopark, it would not only attract investments to the tune of Rs 1,000 crore in the knowledge industry but also generate employment for 1,200 persons. The facility has been set up in the Knowledge Corridor by the Tamil Nadu Industrial Development Corporation (Tidco) as a joint venture with Cornell University of New York, USA. There are 72 modules in the biopark each measuring 915 sq ft and among the first occupants would be a Swiss subsidiary SGS India Limited, the Hyderabad-based Vimta Labs and a company promoted by cardiac specialist, Dr. K.M. Cherian.
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Dena Bank’s public issue soon
New Delhi, November 14 With this second issue, the bank's capital base would increase to a minimum of Rs 287 crore. The move is in view of expansion plans and meeting the globally stringent Basel-II capital norms to be in place by December, 2006. "The prospectus will be ready by the end of this month for the second public issue of the bank for Rs 80 crore," bank Chairman A.K. Khandelwal said, adding that the total issue amount is at base value and premium will be decided once the prospectus is ready. The bank scrip closed at Rs 24.70 in the Bombay Stock Exchange and Rs 24.65 in the National Stock Exchange on Friday. "The government's holding will come down to 51 per cent from the present 70.9 per cent after the proposed issue," Mr Khandelwal said. Apart from Centre's holding of about 71 per cent, institutional investors hold about 6 per cent and the remaining 23 per cent is held by others, including about 20 per cent by the public.
— PTI
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by S.C. Vasudeva IT rules same for all states Q. I took VRS from the bank service in the financial year 2000-01. I was relieved from the service on March 31, 2001. I had taken VRS from New Delhi. My pending service was 49 months. My brother also took VRS from the bank service in the same financial year i.e. 2000-01. He was relieved from Saharanpur. The pending service of my elder brother was 40 months. In both the above cases our pending service was more than 36 months, i.e. 3 years. In our IT returns both of us mentioned the claim under Section 89(1) for reducing the tax liability. Our lawyer at Delhi was of the view that claim under Section 89(1) is applicable on us beyond the limit of Rs 5 lakh. You had also mentioned the same in favour of the VRS optees, in one of your write-ups. In Delhi, the IT Department has given the rebate under Section 89(1) to me and the refund has been received. In country more than 30,000/- employees have taken the VRS from the bank service and in Saharanpur more than 200 persons took the VRS At Saharanpur, the IT Department now has been issuing notices to the VRS optees for taking the refund under Section 89(1) of the Income Tax Act. They have also issued notices for the scrutiny of the previously filed IT returns after a lapse of three and a half years. In Delhi, on the contrary, there is no such issue. Please clarify whether the IT Law is different from state to state or is there is any other reason? Please clarify my point and oblige. After taking the retirement my brother is also living in Delhi but is filing his returns from Saharanpur. Can he request Income tax Department to transfer his file from Saharanpur to Delhi as he intends to file his future returns from Delhi. Please also clarify this point? In your daily publication you have mentioned that the Income tax Appellate Tribunal and the Madras High Court had given the decision in favour of the persons who have opted for the VRS and had taken the rebate under Section 8(1). As of now the IT Department has filed a case in the Supreme Court against the decisions of the Tribunal and the Madras High Court. We are unable to understand that if the case is pending in the Supreme Court for the past six months how could the Commissioner of Meerut region issue notices to the persons who have taken the VRS. What are the further options left for us? Litigation is costly and all pensioners are being harassed. — S.K. Arora A. The answer to your queries is given hereunder: 1. The Income Tax Act, 1961, is a Central Government law and is applicable all over India including the State of Jammu and Kashmir. It is not different from state to state. 2. In the case of your brother, the IT files can be transferred to Delhi if he has shifted permanently to Delhi. He should send a letter to the Commissioner of Income Tax concerned at Saharanpur pointing out that he has shifted permanently to Delhi and, therefore, his IT files may be transferred to Delhi under the charge of the Commissioner who is the designated officer for the range covering your residential area. A similar letter should be written to the Commissioner of the IT at Delhi requesting him to send a no objection for the transfer of your files to Delhi. A copy of the letter written to Commissioner of Saharanpur should be attached along with the letter to be written to Commissioner of Income Tax, Delhi, to enable the Commissioner at Delhi to know the Pan number. Ward/ Circle in which your brother is assessed at Saharanpur and the correspondence address at the said place. After filing such letters you may ask your brother to start filing the return at Delhi. The return should be accompanied by the copies of both the aforesaid letters. Your brother will have to pursue this matter at Saharanpur, otherwise it may take sometime before an action is taken by the officer concerned at Saharanpur. 3. I do appreciate that litigation is a costly process. However, there would be no alternative for your brother but to take up the matter in appeal at various levels and pursue the same so that necessary relief is granted to you under Section 89(1) of the Income Tax Act 1961 (The Act). The relief under the said section should be granted as the amount is in the nature of profit in lieu of salary, which is covered for the purposes of granting relief under Section 89 (1) of the Act. TDS refund Q. I would like to know some points about Income Tax. My queries are: 1. My father aged 75 years old is residing with my younger brother. My father has no individual source of income? 2. My father has fixed deposit in bank Rs. 80,000. 3. At the time of renewal of Fixed Deposit, the bank deducted approx. Rs. 1,500 as TDS for two years during 9/2004. 4. Whether TDS deducted by the bank can be refunded? 5. Whether Pan is mandatory to get the above refund? 6. During which time can the claim of refund be filed? A. The answer to your queries is given hereunder: a) The amount tax deducted at source by the bank is refundable in case the income of an assessee is below the taxable limit. b) It would be essential to have the Pan for filing the IT Return. c) The claim for refund of the IT should be filed before the last date for filing return under Section 139 (4) of the Act. For example, if the refund is to be claimed for assessment year 2004-05, the claim for refund should be filed before March 31, 2006. You must also file Form 30 along with the return of income seeking the claim for refund of tax.
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