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Patel hits
out at Airbus Air Deccan
moots flights to Jammu, Dharamsala |
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Bangalore, May 8 Canara Bank has earned a net profit of Rs 1,109.51 crore in 2004-05, down from Rs 1,338.01 crore reported in the previous fiscal. The net profit dipped by 17 per cent. The bank said the total income earned during the year had increased from Rs 9,079.83 crore to Rs 9,115.80 crore.
Gratuity
up to Rs 3.5 lakh not taxable
All eyes
on monsoon
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Patel hits out at Airbus Mumbai, May 8 Addressing the gathering at a function to launch Vijay Mallya’s Kingfisher Airlines, Patel warned aircraft manufacturers against advice on running India’s airlines. “I caution manufacturers against offering advice on how to run an airline. I hope people present here are listening,” Patel said. Among those present on the occasion were Nigel Howard, Vice-President, Airbus Industrie. Howard and other senior Airbus officials have been demanding an inquiry into Air- India’s decision to purchase 50 aircraft from Boeing. Patel warned that the boards of Air-India and Indian Airlines could decide on what aircraft they require without assistance from manufacturers. Howard, who was present to induct the Airbus A320 into Kingfisher Airlines’ fleet, refused to comment on the matter. Uni adds:
kingfisher Airlines, a 1.8 billion dollar project of the UB Group, was formally launched here last night at an impressive function to mark the 18th birthday of company group Chairman Vijay Mallya’s son, Siddarth. The airlines will formally launch its services tomorrow between Mumbai and Bangalore. The services between Bangalore and Delhi would start next month. The launch function, held at Air-India hangar at the Chhatrapati Shivaji International airport, was attended by several leading personalities and politicians including Maharashtra Governor S.M. Krishna, Chief Minister Vilasrao Deshmukh, Union Ministers Sharad Pawar (Agriculture), Praful Patel (Civil Aviation) and Subodh Kant Sahay (Food Processing) and Sunil Dutt (Sports). Former Jammu and Kashmir Chief Minister Farooq Abdullah and several MPs also attended the colourful function. The airlines’ fleet which would have 33 Airbus aircraft including 10 A320s and three A319s, will offer inflight entertainment like personal videoscreen for every seat and five channels of video. The airlines, which has only one class, promises to provide services of the executive class offered by the national carriers to its passengers. Mr Mallya said the aviation sector was projected to have double digit growth and his airlines would have the youngest fleet of aircraft in the world in the next five years. He said that the ground operations of the airlines would be handled by Indian Airlines. Mr Pawar, who cut the ribbon to mark the formal launch of the airlines, said competition would lead to better services. Mr Deshmukh hoped that Kingfisher Airlines would offer low-cost services. He recalled that Deccan Aviation wanted to offer services at such costs, which would make air travel affordable to farmers in rural areas.
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Air Deccan moots flights to Jammu, Dharamsala Chandigarh, May 8 “After networking the South and the West on short-haul routes, we are ready to expand and connect cities in north India. Flights will also be started to Gwalior and Jabalpur from Delhi. Another 30 ATRs would join the fleet in the next five years. Air Deccan will operate a 48-seater ATR-42-500 on the Delhi-Chandigarh route daily. The bookings for the much-awaited flight by the Budget airline between Chandigarh and New Delhi, tomorrow are below expectations. Head (Corporate Communications) Vijaya Menon told TNS from Bangalore, that 30 bookings had been received on Internet for the Delhi-Chandigarh flight and 60 for the Chandigarh-Delhi flight at the inaugural fare offer of Rs 1,499 from May 9 to May 23. Of these, 20 bookings are for the Rs 500 ticket. The airline would charge Rs 2,021 with effect from May 24. “The response is less as of now for people are still apprehensive of the launch of the inaugural flight but the same will pick up once the airline finally takes off this Monday. The Delhi-Chandigarh flight will take off at 5.55 am and reach the city at 6.55 am. The departure from Chandigarh for New Delhi will be 7.15 am. The flight will reach there at 8.15 am. Food items will not be included in the fare and passengers will have to shell out anything between Rs 20 to Rs 40 for buying a samosa or juice. Mr Gopinath said the airline had styled itself along the lines of the Irish zero-frill carrier Easyjet and offered fares 30 to 40 per cent below those of the Indian carriers operating in these sectors.
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Canara Bank profit dips
Bangalore, May 8 The bank has posted a net profit of Rs 102.30 crore for the quarter ended March 31, 2005 as compared to Rs 384.12 crore for the quarter ended March 31, 2004. Total income has increased from Rs 2,292.96 crore during the fourth quarter of 2003-04 to Rs 2,493.25 crore for the quarter ended March 31, 2005. The board has declared a final dividend of 30 per cent in addition to interim dividend of 25 per cent for the year taking the total dividend to 55 pc.
— UNI
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by S.C. Vasudeva Gratuity up to Rs 3.5 lakh not taxable Q.1 I am very
grateful to your goodself for responding to my query published on
March 21. As per bank gratuity sheet dated 29.01.97 my details are as under: Bank has not responded to my request regarding letter sent on March 23 and even my reminder till date. Kindly advise. — H. S. Gujral A.1. I invite your kind attention to the reply published on March 21 in the columns of this paper in response to your query. It was explained in the said reply that in case of employees other than government employees, the amount of gratuity is exempt to the extent it does not exceed one half month's salary for each year of completed service calculated on the basis of average salary for 10 months immediately preceding the month in which the retirement took place or Rs 3.50 lakh whichever is less. Salary for the above purpose includes dearness allowance if the terms of appointment so provide but excludes all other allowances. The particulars now given by you in the query do not indicate the number of year's service and the average salary for 10 months immediately preceding the month in which the retirement took place. It seems the amount of exempted gratuity in your case has been computed according to the number of years service put in by you. You should ask for the computation sheet from the bank and verify the computation on the above basis. Tax on capital gains Q.2 I have sold residential plot on March 15 for capital gains of about Rs10 lakh and deposited this amount in my savings bank account. My query is as under:- — I do not want to invest capital gains amount in certain bonds, but I intend to purchase a house for an amount equivalent to capital gains of Rs 10 lakh within 2 years from the date of transfer of plot i.e. before March 15, 2007. However if for any exigencies or financial constraints, I could not purchase house before March 15, 2007, what is the option available with me? Can I deposit tax on capital gains immediately before the completion of 2 years without any interest or penalty as the capital gains amount remained in my saving bank account for 2 years. — A.S. Chauhan A.2. Section 54 F of the Income Tax Act 1961 dealing with the exemption of capital gain in case such gain is invested in the purchase or construction of a residential house provides that the amount of net consideration which is not appropriated by the assessee towards the purchase of residential house within one year before the date on which the transfer of original asset took place or which is not utilised by him for purchase or construction of a residential house before the furnishing of the return of income under Section 139 of the Act shall be deposited by him before the due date of furnishing the return of income, in an account with such bank or institution as may be specified under a scheme notified by the government. According to the scheme, the amount of net consideration is required to be deposited with a bank in Capital Gains Scheme Account. Any investment towards the purchase or construction of a residential house will have to be made by withdrawing the amount from such account. The Section further provides that in case the amount so deposited is not utilised wholly or partly for the purchase or construction of a new residential house within the specified period, then the capital gain shall be charged as income of the previous year in which the period of three years from the date of transfer of the original asset expires. In view of the above requirements specified in Section 54 F of the Act, you will have to deposit the net consideration with a bank under the Capital Gains Scheme. This will have to be done before the due date of filing the return of income. In case you are not able to utilise the amount so deposited, the capital gain will be taxed in the previous year in which the period of three years expires from the date of transfer of the residential plot. Rebate on tuition fee Q.4 I want the following clarifications: The rebate under Section -88 on tuition fees of children was Rs 24,000 (Rs 12,000 per child) during the financial year 2004-05. Please clarify whether this amount of rebate on tuition fees of children is enhanced to Rs 1 lakh under Section 80C during the financial year 2005-06 or its limit remains the same? — Harjinder Singh A.4 The memorandum explaining the provisions of the Finance Bill 2005 clarifies that there are no sectoral caps in Section 80C which is proposed to be introduced by the Finance Bill 2005. Accordingly, the limit of Rs 24,000 as contained in Section 88 of the Act would not be applicable under the new provision as contained in the Finance Bill 2005. Interest on KVP Q.5 I retired from government service last year and purchased KVP for Rs 1 lakh in April 04. I have to submit income tax return for financial year 2004-05. So I went to local post office to know the rate of interest that accrued in one year on KVP for Rs 1 lakh. The postmaster informed me that I will get interest of Rs 17,044 after two and half years from the date of investment. Should I wait for the financial year 2006-07 to mention interest of Rs 17,044 in the income tax return for 2006-07 or to workout interest @ 6.8 pc for financial year 2004-05 on the basis or which the post office calculated interest Rs 17,044 to be given after two and half years? — V.R. Sharma A.5 The interest on investment of Rs 1 lakh made by you on KVP in April 2004 should be accounted for on due basis as the interest is payable on maturity. If it is accounted for on receipt basis, the amount of interest received at the time of maturity would be taxable in entirety thereby bringing you in a higher slab. If it is to be accounted on due basis, the interest on KVPs will be computed on the bass of the maturity value of certificates. The maturity period of KVPs is 8 years and 7 months. KVPs can be encashed after a period of 2 years and 6 months only.
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by Lalit Batra
All eyes on monsoon
Markets bounced back last week after the previous week’s losses. The continued flow of good corporate results during the week revived investor sentiment. Both Sensex and Nifty managed to post gains on all trading days last week and gained close to 4 per cent apiece. Sensex ended the week at 6388 and Nifty closed at 1977. Two factors seemed to have changed the market sentiment. First was the positive vibes from the US Federal Reserve while raising the federal funds rate by another 25 basis points to 3 per cent and maintaining a ‘measured’ outlook on inflation. Second was the removal of cap on voting rights in private sector banks, linking them to the shareholding, which was a long-standing demand by foreign investors. This move is likely to empower the RBI to supercede bank boards and order special audit of the accounts of co-operative banks. Besides, banks will be permitted to issue preference shares, an alternative mode of raising equity, without tinkering with the shareholding. Diluting of some of the tax proposals seems to have also aided the market sentiment. The focus of the market will now be on the onset of the monsoon. A timely onset of the monsoon will propel the market whereas the delay may hurt the sentiment. The market is expected to move cautiously this week and selling may emerge after last week’s gains Investors can consider taking exposure on declines in some of the fundamentally strong companies with a long-term perspective.
Glaxo Smithkline Consumer
(GSK)
GSK Consumer is the largest player in the health foods market, with a 75 per cent share. Its white beverage brand ‘Horlicks’ has contributes around 80 per cent to the company’s revenues. The company’s other brands include ‘Boost’, ‘Viva’ and ‘Maltova’. After a couple of dismal years, the health food industry revived last year with 7 per cent growth in volumes. The lag effect of the monsoon and a better price-value equation will sustain 6 to 7 per cent volume growth in the category for the next two years. GSK will be the biggest beneficiary of this growth. The company also stands to gain from the implementation of VAT as the company was paying sales tax to the tune of 15 per cent. Thus, it has the most to gain from a VAT rate of 12.5 per cent. GSK is also no longer a one-product company with 20 per cent of sales coming from Boost and biscuits. This has reduced the risk profile of the company and the company should command a higher discounting going forward. Investors with a two-year perspective can buy the stock at the current price of Rs 340. The risk to the recommendation is the failure of the monsoon in the next couple of year.
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Tourism plan ONGC-HMT pact BPCL expansion |
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