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IT Department blocks duplicate PAN cards Sonalika to set foot on US soil Market Update SEBI mulls exchange for SMEs Tax Advice
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IT Department blocks duplicate PAN cards New Delhi, December 31 "We have already issued letters to duplicate cardholders, giving them 15 days either to surrender their duplicate cards or inform us which one will they use," a senior official in Income Tax department said. The department had given a deadline of December 31 to more than 13 lakh duplicate PAN cardholders across the country to surrender such cards. After the detection of large-scale misuse of duplicate PAN cards in buying shares towards the close of 2005, Finance Minister P.Chidambaram had directed the Income Tax Department to identify the duplicate cardholders and take stringent measures to check their misuse. Consequently, the IT Department found more than 13 lakh persons having two or more PAN cards. The official, who is handling deactivation of duplicate PAN cards, said that by November this year, the department had written more than eight lakh letters and asked field officers to issue such letters to all duplicate card users. In a majority of the cases, duplicate PAN cards had been deactivated from the IT departmen’ts network, he said. The official said the IT Department had clubbed all duplicate cards against the names of users in the computer network to monitor if the cardholders were misusing them for tax evasion or stock market manipulation. The IT Department has also admitted that it was mainly its fault that duplicate cards were issued in the first place. In majority of the cases, the cardholders were not even aware about the illegal possession of cards, Central Board of Direct Taxes spokesman A.K.Sinha said. "In the mid-1990s when PAN cards were launched, the department used to send them through ordinary post, many of which never reached their destination," he said. However, such cards existed in the department's system as assessees applied for second cards, he said. Since the department outsourced the work of issuing PAN cards to UTI and NSDL in 2003 and 2004, respectively, there have been no duplication of PAN cards, he added. — PTI
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Sonalika to set foot on US soil Chandigarh, December 31 Talking to TNS here today after the launch of a new model of their SUV-Rhino, Mr L.D. Mittal, Chairman of Sonalika Group of Companies said they were in the final stages of developing a 35-40 HP compact tractor (also called the orchard tractor). “The USA is a big market for these tractors. Each year almost 1.5 lakh compact tractors are sold in USA and we aim to capture a major portion of this market, once we start commercial production,” he said. Mr Mittal also said that the tractor engines have already got the approval of the US Environment Protection Agency. “We are in the process of completing all formalities with our US partner, so that the production can begin by mid 2007. The assembly line for the tractors will be here and sensitive parts like axles would be exported from our plant at Hoshiarpur, to help cut costs. The estimated cost of setting up the US operations is Rs 100 crore,” he said. The Chairman of Sonalika Group of Companies added that though the compact tractor was being developed specifically for the US farmers, it would also be sold in the domestic market. “This tractor would cost Rs 4 lakh in India,” he said, while adding that they were planning to invest Rs 300 crore for upgradation of their tractor business here. Sonalika Tractors are also exported to various African countries like Mali, Ivory Coast, Senegal, Kenya and Zimbabwe. “Ten per cent of the total production is exported to these countries, and we propose to increase our exports in the next fiscal. As against 32,000 tractors manufactured last year, our production has gone up to 40,000. Other than exports, our domestic sales, especially in Southern Indian states has risen sharply,” said Mr Mittal. Mr Mittal also added that the group was planning to increase the capacity of the Rhino (a SUV) plant and will be developing new models. “By mid 2007, we plan to increase our installed capacity to 500 per month initially to 2000 per month. This would require an investment of Rs 1,000 crore,” he said.
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Market Update Bulls continued to dominate 2006 as well. This is the fourth year in a row that equities have given investors excellent returns. Last year, Sensex was up by 47 per cent while Nifty gained close to 40 per cent. Banking, telecom, IT and cement shares hogged the limelight in 2006. After a sharp setback witnessed in May, June, 2006, due to fears of a rise in the US interest rates, the market staged a solid rebound and key indices struck lifetime highs in December, 2006. Strong corporate earnings growth remained the key driver of the uptrend in share prices. FIIs continued to mop up Indian stocks betting that earnings growth of India Inc. will remain strong in a booming Indian economy. The net FII inflow in 2006 totalled $ 8.2 billion compared to a record inflow of $ 10.7 billion in 2005. FIIs mopped up Indian equities notwithstanding concerns about stretched valuations of Indian equities. What to expect in 2007
I believe this year mid-Caps should outperform large caps. It may be recalled that mid-cap stocks have not recovered since the May-June crash last year. The sectors that should do well are retailing, banking, infrastructure, telecom, automobile. I also remain positive on the pharma as more patents expire in the coming years providing generics producers to capture the markets. The Broader markets may not gain as much as it did last year but I continue to remain bullish on the Indian markets over the medium term and believe that Indian equities is the place to remain invested in for the next three years at least. Three stocks — Suzlon, Blue Bird, Wockhardt — have declined since the date of recommendation. I stay positive on all of them. |
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Kolkata, December 31 "We are planning to form a separate trading platform for the SMEs. We have already formed a small in-house committee to study and prepare roadmap for the same," SEBI Chairman M. Damodaran said during his recent visit here. The new trading platform for small and medium companies will help SMEs shop in the overseas markets like Luxembourg and London's AIM market to raise their resources. Merchant banking circle believe that SEBI will offer some relaxations in terms and disclosures to SMEs planning to hit the market in comparison to stringent regulations for stocks listed on the NSE and the BSE. — PTI
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Tax Advice Q. I am working as lecturer in a private institute drawing salary of Rs 4,000 per month. I have no appointment letter and get no salary slip but do mark my attendance in the register on working days. I have got my own PAN and want to file IT return of my own, but in absence of Form 16 from the employer, can’t file it. (can’t ask for the fear of losing the job). I have two queries: (1) If I do not file my own return, does my income get clubbed with that of my husband’s (who is already a taxpayer)? If yes, then I am loser in two ways vide getting meagre salary and tax being deducted on that too thereby reducing my earnings further. Women in service, who get Form 16, get paid more and on that too tax is exempted up to 1,35,000. (2) If I do not file my return and do not club my income with my husband’s will my earnings be treated as black money generated in absence of any proof. Kindly suggest how can a person file return in absence of Form 16? Your answer will benefit lakhs like me employed in the private sector. — Jyoti Sharma, Mamta, Chandigarh A. You can file your return of income without Form 16 because no tax would have been deducted in your case and, therefore, the employer has no obligation to give you Form 16. A certificate from the employer certifying your salary will be a sufficient proof for the purpose of filing the tax return. Since you are working as a lecturer in a private institute your income would not be clubbed with the income of your husband. Women employees
Q. The details of income in respect of my wife (38 years) for 2005-06 are as follows: (a) Income from (b) Short-term (c) Interest from Total: Rs 84,050 Please tell me the income tax liability for 2005-06 if any. — Rajiv Kumar, A. In view of the fact that the income of your wife is below Rs 1,35,000, the maximum amount up to which tax is not chargeable in case of women assessee who are below 65 years of age, no tax liability would arise in the case of your wife. Form 15H
Q. If a total sum of interest payable by a bank to its customers exceeds Rs 50,000 per annum, is the bank concerned under obligation to deduct income tax at source, even if the customer submits Form 15H or 15G and his total income is not taxable. — B.R. Mehta, Solan A. The bank is obliged to deduct tax at source (@10 per cent plus education cess) in case the interest credited or paid or likely to be credited or paid during the financial year does not exceed Rs 5,000. Form No. 15H can be filed only by a senior citizen if such individual furnishes to the person responsible for paying any interest, a declaration in writing in the said form in duplicate to the effect that the tax on his estimated total income of the previous year in which such interest income is to be included in computing his total income will be nil. Form 15G can be filed by a person (not being a company or firm) if such a person furnishes to the person responsible for paying any income of the nature referred to in (Section 193 or Section 194A) or Section 194K, as the case may be, a declaration in writing in duplicate in the prescribed form and verified in the prescribed manner to the effect that the tax on his estimated total income of the previous year in which such income is to be included in computing his total income will be nil. However, the use of Form 15G became restrictive on account of the introduction of sub-section (1B) to the Section 197A of the Act, w.e.f. June 1, 2002. The said sub-section provided that the provisions of the Section 197A will not apply where the amount of any income from interest etc. or the aggregate of such income credited or paid or likely to be credited or paid during the previous year in which such income is to be included exceeds the maximum amount not chargeable to tax. The provisions to allow relief to senior citizens as stated hereinabove were brought in by the Finance Act, 2003, w.e.f. June 1, 2003. Sec 80C amended
Q. You are requested to give the information/advice on the following issue. What are the salient features of five years F.D. exempted under the Section 80C announced in this year’s Budget. What is position with regard to TDS on such FDs. Whether these are issued by the post office or banks or both. Nowadays banks deduct TDS as and when the same matures for payment. Since the introduction of core banking, computers deduct the amount whatever it is required by computer. In case of more than one STDR, all are clubbed together, will consolidated TDS change. As such please, what is the best option for investment, whether of I.T. exemption or otherwise. Please advise the investments which are not subject to the TDS. Please note, I am 61 years old, not a senior citizen for I.T. purpose but suffered from hearing loss, eligible for exemption under the Section 80U. —
Sudarshan Kumar Jain, Ludhiana A. Section 80C of the Act has been amended by the Finance Act, 2006, so as to include within the permissible limit of Rs.1 lakh, the making of a term deposit for a fixed period of not less than five years with a scheduled bank in accordance with the scheme framed and notified with the Central Government for this purpose. To my knowledge, the scheme does not provide for any exemption in respect of tax to be deducted at source. The tax is required to deducted by each branch in case the interest exceeds Rs 5,000. It may, therefore, not be possible to avoid the payment of tax at source in case the amount of interest exceeds Rs.5,000. It will be better to utilise the maximum limit of Rs1 lakh provided by the Section 80C of the Act so that the permissible deduction is claimed against total income. The investment in Public Provident Fund Account is always much better. PO schemes
Q. I have opened two accounts under Post Office Monthly Income Scheme, each Rs 3,00,000, one on October 15, 2005, and the second on January 5, 2006, joint with my wife. I am first in both accounts. Consequently amount(s) have been drawn from joint account with my wife. We both are tax payee. Sir, my query is whether my wife can claim half of interest earned as her income for the purpose of income tax calculations or will the total interest earned remain my income. — Dharam Pal Kalia, Hoshiarpur A. The taxability of the interest income would depend upon the source and ownership of the funds in the Post Office Monthly Income Scheme Account. The interest earned in a joint account would thus be taxed on the basis of the deposit made by each one of you on the aforesaid basis. In case, the deposit is made by you out of your source in the joint name of yourself and your wife, interest earned on such deposit would be taxable in your hands. Therefore, it will be necessary for you to prove that the amount of deposit made by your wife is out of her own sources so as to claim the taxability of interest earned on such deposit in the hands of your wife. |
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