 |
|
ADVERTISEMENT
|
New IT form 2F here to stay
RIL pact with Haryana for SEZ today
More charges filed against Hyundai chief
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Ashok Leyland eyes Malaysian market
Mumbai, June 11 Ashok Leyland is exploring the possibilities of entering the Malaysian market in a big way. “The Malaysian market is highly lucrative and we are already supplying components to Tractor Malaysia, a leading local major,” Mr S Nagarajan, Executive Director-Projects, Ashok Leyland, said here.
Dabur looks for buyouts abroad
Jetstar fare
News Analysis
Market scan
Tax Advice
|
|
New IT form 2F here to stay
New Delhi, June 11 “The new tax form is here to stay. Though the form is notified only for this year, it would be re-notified for next year (2007-08) maybe with some modifications based on review and feedback,” Revenue Secretary K.M Chandrashekhar said. The new four-page form, which would replace the existing one-page ‘Naya Saral’ form ‘2E’, sparked criticism from various quarters including the Congress, which wanted the form to be ‘Saral’ (simple) and any new form to be further simplified. This year, the filing of returns on the new form is optional until July 31, the last date for filing
income tax returns. The assessees have the choice of filing returns either in the new one or the old Naya Saral form. Beyond July 31, the assessees can file returns only in the new form 2F or Saral form 2D, which is still in use. The controversy over the new form centred around a new schedule ‘5’, in which the assessees have to provide a cash flow statement for the financial year that would include their income, expenditure and investment. But filling this schedule, which has widely been criticised, was however optional for this year. Form 2F, which is to replace the existing Form 2E (Naya Saral) is in the eye of a storm for being more cumbersome and for introducing a ‘cash flow’ statement. The official, however, said the statement was only optional and claimed that it was friendly to the salaried class. Asked whether the raging controversy over ‘Form 2F’ had made the department any wiser, Mr Chandrasekhar quipped: ‘’Nothing much has changed.’’ In fact, he expressed confidence that as time went by more and more salaried persons would shift over to the new form.’’They need to understand more clearly the logic of the changes that have been introduced,’’ he said. Individual assessees still have several forms to choose from, Mr Chandrasekhar added. Close on the heels of introducing the hotly debated Form 2F for individual tax-payers, the government is planning to bring in new forms for corporate tax-payers and business tax- payers.’’ A revised form is being considered for corporate and business tax- payers,’’ Mr Chandrasekhar said. Mr Chandrasekhar said the new forms were necessitated, among other reasons, by provisions of the fringe benefit tax (FBT).
— Agencies |
|
RIL pact with Haryana for SEZ today
Chandigarh, June 11 Mr Ambani would fly here tomorrow for signing the joint venture agreement with the Haryana State Industrial Development Corporation for the multi-product SEZ to be spread over 25,000 acres. RIL, country’s largest corporate entity, would pump in Rs 25,000 crore in the venture and expects another Rs 100,000 crore investments by units located in the zone. The SEZ envisages a fully integrated city having an airport, rail linkages, including from Delhi Metro, an international container depot and adequate supply of power, water and communication facilities, informed sources said. The SEZ would be used for industrial, commercial, institutional and residential purposes. It was expected to generate employment for more than two lakh persons and would house up to four lakh residents. RIL plans to rope in low polluting industries with thrust on knowledge-based sectors such as pharma, electronics and telecom, besides trading and services. The industrial units would be allocated up to 25 per cent of the total land. The commercial segment would be given an area of about 20 per cent while the residential area would comprise approximately 15 per cent of the total land area.
— PTI |
|
More charges filed against Hyundai chief
Seoul, June 11 Prosecutors indicted Chung on two more counts of breach of trust, said prosecution spokesman Kang Chan-woo. Chung, jailed in late April, was charged last month with allegedly embezzling company money to create a $108.4 million fund that prosecutors suspect was used to pay lobbyists to seek government favours. Chung was also charged at that time with breach of trust for allegedly causing damage to his company by illegally supporting financially weak affiliates with money from other group members. Mr Kang said that prosecutors had decided to not file charges against Chung’s son, Kia Motors Corp. President Chung Eui-sun, in the case “as the main responsibility lies with his father.” Prosecutors said in April at the time of the elder Chung’s arrest that they would continue to investigate the Kia chief. Kia, South Korea’s second-largest automaker, is a Hyundai Motor affiliate.
— AP |
|
Ashok Leyland eyes Malaysian market
Mumbai, June 11 The company’s Auto Components Group (ACG) has recently scaled up operations in Malaysia by supplying components to several ancillary companies there as well. “We now want to enter the Malaysian market in a big way, given the huge scope of the auto components business in that country. We are exploring joint venture possibilities there,” Mr Nagarajan said. The Auto Components Group, set up last year, was totally export-oriented and exported to markets in West Asia, South-East Asia, the USA and Europe.
— PTI |
|
Dabur looks for buyouts abroad
New Delhi, June 11 The company has overseas manufacturing bases in West Asia and Africa. “The organisational revamp for overseas business, which operates under Dabur International Ltd, will see the company split international business into two portfolios. “Portfolio one would comprise Asian markets, including Bangladesh, Malaysia, Nepal, Pakistan, Sri Lanka and developed markets, including the USA and the UK. Portfolio two would focus on markets in the Gulf Cooperation Council (GCC) countries, African markets, including Egypt, Morocco, Nigeria, Sudan and other Wast Asian countries like Iran and Iraq.
— PTI |
|
Jetstar fare
Bangalore, June 11 |
|
|
News Analysis
New Delhi, June 11 In fact, the family budget has been totally upset by the rising expenses on housing, transport, food items and increased tax burden. Although UPA government is led by stalwart economists like Prime Minister Manmohan Singh, Finance Minister P. Chidambaram, and Deputy Chairman of the Planning Commission, Montek Singh Ahluwalia, the salaried class is agitated that they have to pay through nose for maintaining a decent living standard. For instance, a salaried class family with an average monthly income of say Rs 30,000, which was spending about Rs 4000 a month on petrol in April 2004, (Rs 33.70 a litre) on two family bikes or a car, before the UPA came to power, is today spending about Rs 6000 a month (at Rs 47.70 a litre) to run family the vehicles. Although the Prime Minister blames rising international crude prices for rising fuel costs, the middle class families who had voted in favour of the Congress in the name of Sonia Gandhi, are not ready to listen to lectures in international economics. “We had voted for Sonia Gandhi, and she is silent on rising prices of essential commodities and our increased tax burden,” said Romila Sehgal, a school teacher in Noida. The salaried class is also disturbed over the fact the housing costs are sky-rocketing. Mr Ashok Sharma, a chartered accountant said, “In 2004, we were getting a two-bed room flat for Rs 25 lakh, whose costs is now touching Rs 40 lakh. At that time, banks were chasing us for taking housing loan at 7 per cent, today they are asking interest of up to 10 per cent. “If the EMI for a Rs 15-lakh loan for 20 years at 7 per cent interest rate was around Rs 11,630 a month, now for a Rs 25 lakh at 9.5 per cent, I will have to pay about Rs 23,000 a month.” It implies that a simple flat is now out of range for the family with an income of Rs 30,000 a month. Moreover, Finance Minister P. Chidambaram’s two budgets presented in the name of “aam aadmi” have also increased the tax burden of the urban class. An average urban family is now paying Rs 100-200 a month additionally as taxes on insurance, courier, hotel bills, children’s coaching classes, and telephone service for they have to pay 10 per cent tax along with 2 per cent educational cess on them. Indeed, the pressure of the Left and the Congress Party have discouraged the UPA government from hiking LPG cylinder price, but the kitchen budget of the family has been shattered due to increase in price of items like vegetables, fruits, pulses, milk, refined oil, rice and flour as well. The average price of urad, moong and other lintels, which was around Rs 30 a kg in 2004 is now touching Rs 60 a kg, and vegetables and fruits are costlier by Rs 5-10 a kg. The monthly bill on edible oil, foodgrain and fuel has also gone up by over Rs 100- Rs 200 a month. |
|
|
Market scan
Last week Sensex was up by 514.65 points after a long fall during the past two weeks. Even at this rate Sensex has lost about 23 per cent from its highest level reached in May. Even after last Friday’s upsurge in the market Sensex is still 6 per cent below its closing value a week ago. Is the market correction closing up? It is not easy to answer this question. This week’s performance of the market would provide an answer to it.
There are many negative factors still haunting the Indian and global stock markets. The first negative factor is the high international crude prices at $ 71 per barrel. There is likelihood of a further rise. The second negative factor is the raise in the global and US interest rates and many analysts expect a further rise in interest rates in the USA. Also, Morgan Stanley and other international investment agencies state that there is global liquidity sluggishness and definite squeeze over availability of funds. There is also a great deal of nervousness among investing. FIIs and hedge funds which are withdrawing from the emerging markets after redeeming their investments. An interesting aspect of last week’s performance of the stock market is that while some FIIs have been making fresh investments as the domestic mutual funds have been heavy sellers. The domestic mutual funds have been facing redemptions, which, according to one estimate, range between 1 and 3 per cent. The mutual funds are also selling in the market to maintain sufficient funds to face more redemptions. Some other negative factors for the domestic market are: (a) hike in the petroleum and diesel prices; (b) current account deficit which may even balloon up 3.5 per cent of the GDP by the end of the current fiscal year from the present level of 2 per cent; (c) The ICICI Bank has raised the lending interest rates by 0.5 per cent and other banks are likely to follow (d) Banks have put 60 per cent margin on loan against equity shares. Some of these factors are likely to eat into the profit margins of the corporate sector. Both mutual funds and traders and the retail investor have lost very heavily due to a consistent fall in the share prices. Their investments in equity shares are becoming scarce on account of both scarcity of funds and nervousness. At least till the corporate results for the quarter ending June 30 are announced, there is no trigger which may push up the market. At best the market may move within a narrow range; at worst the market may suffer a further loss. Long-term investors should hold on to the bluechip equity scrips which have good managements and future prospects, though it may take a couple of months before the market revives in the real sense but don’t expect the market to touch the past high levels in the indices. |
|
|
Tax Advice
Q. The investments in the PPF in a single financial year, are exempted from tax u/s 10 and u/s 80C of the IT Act. Does this mean that a single investor can invest Rs 70,000 in the PPF account and claim full exemption u/s 10 and then can invest 1 lakh in ELSS and claim full exemption u/s 80C within the same financial year?
Vineet Aggarwal, Gurgaon A. The deduction under Section 80C of the Income-tax Act 1961 (the Act) is allowable to an assessee against his total income to the extent of Rs 1 lakh. The amount of Rs 1 lakh so deductible includes the contributions made to the Public Provident Fund. The maximum amount permitted to be contributed under the Public Provident Fund Scheme is limited to Rs 70,000. The accumulated amount in such Public Provident Fund is not taxable in the hands of the assessee under Section 10 of the Act as and when amount from the said account is withdrawn by him. Tax liability
Q. I am employed in a nationalised bank. Kindly advise my tax liability. Also I am not clear about the tax liability of the perks I am getting. 1. My gross salary — 2,30,700/- Arrears — 37,000/- (due to salary revision) Interest income — 15,000/- (NSC + FD + S/B) 2,82,700 2. Perks which I am getting are: (a) Reimbursement of petrol bills for scooter owned by me for official duty 1,600 p.m. (approx.) (b) Reimbursement of newspaper bill at home Rs 150 p.m. (approx.) (c) Reimbursement of bills of snacks during official duty for purpose of maintaining public relations 285 p.m. (approx.) (d) Reimbursement of bill of cleansing material used for furniture at home 400 p.m. (e) Furniture provided Rs 36,000 (cost) 3.
Investment under Section 80C PF - 18,000 (Arrear) PF - 12,000 House Loan - 48,000 NSC instalment - 10,000 interest (approx.) PPF - 12,000 100000 4. Donation of Rs 51,000/- to Divya Yog Trust Hardwar of Ram Devji on receipt of donation it is mentioned “All Donations are exempt from income tax under Section 80G of the Income-tax Act”. Anupama Sethi A. From assessment year 2006-07 onwards, the perquisites listed at (a) to (d) would be taxable as Fringe Benefits in the hands of the employer. The reimbursements at (a) would get covered in the conveyance at (b) and (d) in employee welfare and (c) in hospitality of every kind. All the expenses under the above heads are taxable in the hands of the employer as stated above and would not be taxable in the hands of the employee. However, in case these reimbursements are of fixed sums, there is a danger of these being included as part of your salary. If they are so included, these would not be covered for the purposes of Fringe Benefits Tax. The perquisite for the furniture provided to you would be taxable in your hands and 10 per cent of the cost of furniture would be added to your taxable salary. The donation of Rs 51,000 paid by you to Divya Yog Trust, Hardwar, will be considered for the purpose of deduction from your total income to the extent of 50 per cent of the amount paid. However, the deduction made under Section 80G of the Act is limited to 10 per cent of the total income as reduced by any portion on which tax is not payable under any provisions of the Act and by any amount in respect of which the assessee is entitled to a deduction from any other provisions of chapter VI-A of the Act. Since your total income after the deduction allowable under Section 80C of the Act would be only Rs.1,86,300 (including Rs 3,600 being perquisite value of free furniture provided to you), you will be entitled to a deduction of Rs 9,315/- being 50 per cent of Rs 18,630. The total tax on the basis of figures given by you would work out at Rs 10,606, including education cess. I may add that I have not taken into account relief under Section 89 of the Act on the arrears of salary. In case that claim is made by you, figures of tax etc., would change accordingly. Rebate on GPF
Q. Please clarify whether the income-tax rebate is admissible on GPF contribution in respect of the employee who retires during the Financial Year 2005-06 i.e. on 31.08.2005 or in any month before 31.03.2006 and receives the full and final payment of G.P.F. amount immediately after retirement. Balbir Singh Mian, Chandigarh A. The amount received against your GPF on retirement is not taxable as the same is exempt under Section 10 of the Act. An assessee would be entitled to deduction for contribution made to GPF up to 31.08.2005 against the salary income earned for the period 01.04.2005 to 31.08.2005. |
| HOME PAGE | |
Punjab | Haryana | Jammu & Kashmir |
Himachal Pradesh | Regional Briefs |
Nation | Opinions | | Business | Sports | World | Mailbag | Chandigarh | Ludhiana | Delhi | | Calendar | Weather | Archive | Subscribe | Suggestion | E-mail | |
