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BSNL to invest Rs 17,000 cr on expansion
Video-conferencing between Delhi, Mumbai soon
India cautions against high oil prices
Resume Doha talks: IMF
Essar Tele offers Rs 4,949 per share
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Hartron offers financial help to tech innovators
Market Scan
Tax Advice
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BSNL to invest Rs 17,000 cr on expansion
New Delhi, September 17 “A major investment of Rs 6,000 crore has been earmarked for GSM expansion. About Rs 3,000 crore will be spent for expanding broadband services and a similar investment will be made in CDMA-based services in various parts of the country,” BSNL Chairman and Managing Director A.K. Sinha said here. Mr Sinha said BSNL would also invest about Rs 1,000 crore on the call data record (CDR)- based billing system. This allows carriers to quickly process huge volumes of call detail records to help them retrieve vital, detailed information regarding billing, interconnection agreements, Quality of Service, Call Routing Pattern and more. This type of granular search capability will give providers enhanced visibility into their call traffic patterns and will ultimately help them make better business decision, say experts. Mr Sinha said: “The entire investments would be funded through internal accruals and there is no plan to borrow from the market at this juncture.” Meanwhile, taking a cue from private corporate houses, all Chief General Managers have been told to start procuring land and other infrastructure so that the rollout for the over 63 million GSM lines could begin as and when the equipment is received. “ We have asked our CGMs to start acquiring new sites and fix towers so that as the equipment comes and frequency is given, we should be able to start services,” Mr Sinha said elaborating on the PSU’s strategy to expand mobile operations and 3G services in rural and other parts of the country. To start with, BSNL would offer 3G services in 250 out of 600 district towns. — PTI |
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Video-conferencing between Delhi, Mumbai soon
New Delhi, September 17 “We are considering various additional services for our subscribers, there may be many more surprises for our landline users. Video-conferencing is just one of them,” MTNL CMD R.S.P. Sinha said. Asked about the charges and equipment (video camera) required for video-conferencing, Mr Sinha said the company would work out a package for providing such facilities “at an extremely affordable price.
— PTI |
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India cautions against high oil prices
Singapore, September 17 There were concerns about ‘protectionist pressures and persistence of high oil prices’, which exacerbate risks on the inflation front and consequent increase in interest rates, Finance Minister P. Chidambaram said at the annual meeting of the IMF-World Bank. The medium turn oil outlook did not give much comfort, particularly to net oil developing countries like India, he said, adding that continued geo-political tensions in West Asia and possible supply disruptions in other major oil producing regions were pointers to the lingering nature of the oil shock. Given the dependence of the global economy on oil, there was a need for policy intervention, both at the national and international levels, to improve the market micro structure and promote investment in oil production, he said. Higher interest rates in advanced economies had implications for financial markets, he said, adding that a tightening of financing conditions for emerging markets might exacerbate vulnerabilities. Mr Chidambaram said alongside oil prices, non-fuel commodity prices had also increased to record levels. “Though it has had a favourable impact on growth performance of a number of countries, major commodity exporters, however, remain vulnerable to cyclical changes in the commodity markets.”
— PTI |
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Resume Doha talks: IMF
Singapore, September 17 The efforts should be based on a commitment to a comprehensive package on agriculture, industrial products and services to which "we said all countries will need to contribute," the finance ministers said.
— PTI |
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Essar Tele offers Rs 4,949 per share
New Delhi, September 17 The company said in an announcement to its shareholders that it had offered Rs 4,949 per share to acquire 1.68 lakh shares representing 3.37 per cent of the total equity capital of the company, which would lead to a total outgo of Rs 83.14 crore. The offer price is a premium of 1377 per cent to the last traded price of Essar Teleholding of Rs 335 a share on October 29, 2004. The company said its shares had hardly been traded over the past 10 years and there was hardly any public interest in its equity structure. The company said the final exit price payable to shareholders would be announced on September 30. The final settlement date has been fixed at October 7 for shares in the demat form while for shares in the physical form, the date is October 28. Essar Teleholdings is the joint venture partner of Hutchison of Hong Kong in the mobile joint venture. The cellular telephony JV has about two crore subscribers.— PTI |
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Hartron offers financial help to tech innovators
Chandigarh, September 17 Stating this here today, a spokesman of the Hartron said any innovator in the country, including engineers, scientists, farmers, artisans, housewives, students, professionals or even a common man with innovative ideas could apply for seeking the financial support. However, software development and basic research are not supported under the Technopreneur Promotional Programme of the ministry. He said the innovation should be original, novel, based on scientific principles and be convertible into physical product for use. Those desirous of applying for the financial support, could get the application form free of cost from the Hartron centre in Ambala. —
UNI |
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Promoter’s stake up in Tata cos
by J.C. Anand After flirting with the 12,000 point Sensex gained it last week once more. Last time it was on May 12 that level, Sensex had also closed at the 12000-point level. How long will Sensex retain it is uncertain? Much more will depend on the second quarter results which will be available only after the first week of October. The market is likely to remain range-bound till here. The second-quarter results are, however, likely to be good. The Index of Industries Production (IIP) for July, 2006, stands at 12.4 per cent as against 4.5 per cent in July, 2005. According to various estimates GDP growth for the current financial year is likely to be around 8.5 per cent. The international crude prices have come down to $63 per barrel which is likely to benefit the Indian economy. There are reports that Reliance Industries, ACC, Century Textiles and many other companies have deposited higher larger advance corporate tax deposits this September than during the previous year. Tata companies were in the news both for spreading their wings abroad and for upping the promoters’ stake in their equity shareholders. Tata Tea has made a 30 per cent stake in US-based Energy Brand Inc. involving an investment of Rs. 890 crore through its subsidiary TTGB, along with direct investment by Tata Sons. Tata Tea will be approaching its shareholders for raising additional capital not exceeding 20 per cent of the existing capital by making a preferential issue of equity shares with attached warrants to Tata Sons. This will bring in about Rs. 420-460 crore and the balance amount will be raised by Tata Tea from the sale of its investments and its own resources. Incidentally, this is Tata Tea’s third investment venture in foreign countries. It had acquired UK’s Tetley and Good Earth Teas in US. The US-based 8’0 Clock Coffee was also acquired by Tata Coffee, the Tata Tea’s subsidiary. Tata Tea has at present an equity capital of Rs 56.22 crore with the promoter stake of 29 per cent. Its book value is Rs. 202.7. With further investments by Tata Sons in Tata at the current market value, the promoter’s stake will not only go up but it will also add to the “premium reserve” (of the company). The long-term investors, however, will have to wait for at least two years for the maiden bonus issue of the company. Tata Sons has also upped its stakes in Tata Steel (Risco) as well as in Tata Chemicals. This is to strengthen the hold of the Tata group in its companies and to ward off any hostile takeover attempt. Tata Chemicals also recently took over the Brunner Mond group, a UK-based soda ash company, with its subsidiary and become an equal partner in holding a Moroccan company with large phosphate deposits. Jai Bharat Maruti has announced its maiden bonus issue in the 1:1 ratio. At present the company has an equity capital of Rs. 5.41 crore with a book value of Rs. 41.30 Its Rs 5/- face-value equity share is quoting around Rs. 127-128 and a fresh investor will be entitled to bonus shares with ex-bonus equity quoting at Rs. 65. There is scope for some margin for appreciation. The company’s present dividend is 35 per cent and the company has an EPS of Rs. 8.80 for its Rs. 5/- face-value share. The company is likely to maintain its present dividend even after the bonus shares.
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Deduction in respect of GPF has a ceiling of Rs 1 lakh
by S.C. Vasudeva
Q. Please advise me
regarding the following queries for the Financial Year 2005-06
(Assessment Year 2006-07):-
1. You have mentioned in one of your
answers that there is no separate limit for GPF and amount subscribed so
is included in overall limit of Rs 1,00,000 provided for by the said
Section (80C). (i) Kindly clarify whether subscription in General
Provident Fund (GPF) for the Financial Year 2005-06 stands revised to Rs
1,00,000 from Rs 70,000 in Finance Act 2005 or it still stands at Rs
70,000. It is also intimated that an employee of H.P. Govt. covered
under GPF Rules. An amount of Rs 1 lakh contributed in GPF during
Financial Year 2005-06 is deductible under Section 80C or not. (ii)
What is basic difference between GPF and PPF? 2. Section 24 (B) of the
I.T. Act, 1961 provides for the deductions from the income chargeable
under income from house property. One of the deductions allowable is the
amount of interest. Above section of Act used the expression
"Interest payable" during previous financial year, therefore,
one can claim the deduction on interest on accrual basis. My question
is whether above expression is still relevant in current Financial Year
(2005-06). The certificate that the interest thereon is "Actually
paid" to the person/bank from whom the loan has been taken.
Please clarify that "Interest payable" is allowable under
section 24 (B) or not. — Baldev S. Thakur, Kangra A. The interest
under Section 24(1) of the Act can be claimed against income from
property on accrual basis provided the same is supported by the
necessary evidence. This position has not changed for assessment year
2005-06. Tax liability Q. I am a lecturer at DAV College of Engg.
& Technology Kanina. My gross income is Rs 1,59,653 p.a. Please tell
me the due income tax on my salary. I have taken LIC policies worth an
yearly premium for 2005-06 of Rs 28,266. Kindly advise me about the
other savings that I would have to make to avoid paying income tax. I
would highly appreciate if you could suggest the possible way for the
extra savings that I have to make. — Davender Singh, Mohindergarh A.
On the basis of figures given in the query, your taxable income
would work out at Rs 1.31,387 (1,59,653 - 28,266). The tax and education
tax thereon would work out at Rs 3,202. Apart from insurance premium,
you can deposit amount in Public Provident Fund Account, invest in
National Saving Certificates (VIII issue), invest in fixed deposits with
a scheduled bank for a fixed period of not less than 5 years under a
notified scheme so as to avail deduction of Rs 1,00,000 under Section
80C of the Act. There are other saving schemes covered under the said
section, but I have mentioned few of them due to space constraints. Rebate
on fee Q. My daughter is preparing for PMT Exam 2006. For this purpose,
I had paid Rs 5006 to Brilliant Tutorials, Chennai. The receipt of this
amount, reads as follow: Course fee Rs 4,543 Service Tax @ 10.2 pc Rs
436 Total: Rs 5,006 I have also paid other fee, one such receipt reads
as follows:- Competitive tests Rs 2,000 Service Tax @ 10 pc Rs
200 Education cess 2 pc Rs 4 Total Rs 2,204 Can I claim rebate
against those receipts? — Harjit Singh, Amritsar A. The
deduction in respect of tuition fee paid is allowable under Section 80C
of the Act in case the same is paid to any university, college, school
or other educational institution situated within India for the fulltime
education of any two children of an individual. In case you have paid
the tuition fee which fulfills the above test, you would be entitled to
such deduction. Tax on arrears Q. I have been a Chief
Sanitary Inspector since December 22, 1973 with the Municipal
Corporation of Chandigarh and was granted proficiency step-up increment
after 18 years of service on December 22, 1991. The increment was
withdrawn on August 2004 and deduction of Rs 2,000 per month started
from my salary to recover the entire amount of this increment. In income
tax assessment year 2005-06, Rs 24,000 will, thus, be recovered up to
February, 2006 from my annual income. (i) Should this amount of Rs
24,000 of recovery (which clearly is not my income) be included in my
income for calculating income tax? If not, under what section of the
Income Tax Act. 1961? (ii) Are the recoveries of any kind from salary
not counted in the income while calculating income tax? The
department has wrongly withdrawn my increment. I have contested the
withdrawal in a court of law. If the court decides the case in my favour
and grants the increment retrospectively and also grants arrears
thereof. (iii) Will the amount of arrears be included in my annual
income? (iv) Will the amount of arrears be taxed again for the third
time to calculate income tax? House building advance (HBA) was given
to me by employer in 1986, principal of which was recovered from my
salary @ Rs 315 per month up to July 2002. Recovery of interest
component stated @ Rs 315 per month from my pay w.e.f. August, 2002 and
Rs 3,780 is going to be recovered in the income tax in 2005-06. (v)
What will be the rebate on this amount of interest of Rs 3,780 in the
calculation of income tax? (vi) Will this amount of Rs 3,780 be
subtracted from the total income of year 2005-06 for the purpose of
calculation of income tax? — Jagjit Singh, Chandigarh A. (i)
The deduction of Rs 24,000 would be allowable against your salary income
in view of the decision of ITAT in the case of Rajat Lal v. DCIT (66 ITD
333) (Delhi Bench "E") (ii) The recoveries from salary which
has been wrongly paid can be allowed to be deducted as per the above
decision. (iii) & (iv) The arrears, if received would be taxable
and included in your annual income. You would, however, be entitled to
relief under Section 89 of the Act if the claim is made by you in this
regard. (v) The repayment towards house building advance would be
deductible from your total income under Section 80C of the Act. The
interest payable is deductible against income from property under
Section 24 of the Act.
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Indus Airways AGM concludes |
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