 |
|
|
Coal India eyes power
generation
Gigantic LOSS
SAIL out of steel alliance |
|
BSNL ‘disconnects’ Tata
Indicom, RCom
MRTPC initiates probe against FMCG firms
Trident Group eyes Rs 300 cr from retail venture
Tax Advice
Market Update
|
|
Coal India eyes power
generation
New Delhi, May 4 CIL and its subsidiaries are entering into power generation through MoUs and joint ventures (JVs). While CIL has already signed an MoU with the National Thermal Power Corporation (NTPC) to develop coal blocks and power projects, its subsidiary Central Coalfields is considering a JV with Neyveli Lignite Corporation (NLC) to establish a 1,000-MW power plant in North Karanpura Coalfields. Another of CIL’s subsidiaries - Northern Coalfields (NCL) has agreed to set up a thermal power station with 1,000 MW capacity through a JV with Uttar Pradesh Rajya Vidyut Utpadan Nigam. Northern Coalfields is also considering a JV with NLC for integrated coalmine-cum-thermal power plant in Madhya Pradesh, while Southeastern Coalfields is all set to have a joint venture with Chattisgarh State Electricity Board. While this happens, coal stock situation in thermal stations across the country continues to suffer, with CIL being able to meet domestic requirement. Sources in the industry term the situation as “anomalous”, considering CIL, the largest coal producer and supplier in the country, is diversifying into power generation when domestic requirements are not being met. According to data on coal availability, several stations in the North are already facing a low coal stock position. Lehra Mohabbat thermal station in Punjab, Yamunanagar station in Haryana, Kota and Suratgarh stations in Rajasthan have critical coal stocks for just seven days. Central Electricity Authority norms, on the other hand, say thermal stations should hold coal stocks of between 15 and 30 days depending on their location. While pithead stations should hold stocks of 15 days or more, stations located away from the mine should hold coal stocks for 21 to 30 days. But norms are being defeated with low supplies of coal by CIL. Resultantly, pressure to import coal is mounting. In Punjab also, thermal stations at Bathinda, Lehra Mohabbat and Ropar will enter peak June and July seasons with a dangerously low coal stock position. Padamjit Singh, former chief engineer with Punjab State Electricity Board, today told The Tribune: “We will be unable to build stocks ahead of the peak season. And as always, power generation during the monsoon season will suffer.” He adds: “When CIL can’t meet local requirements, its diversification into power generation sounds odd.” |
|
Gigantic LOSS
New Delhi/New York, May 4 In its financial results for the period ended March 31, Berkshire Hathaway disclosed a notional loss to the tune of $1.6 billion in different kinds of derivatives. The company posted an unexpected 64 per cent plunge in net profit at $940 million for the Q1-08, from $2.59 billion in the year-ago period. In 2002, Buffett had written in his letter to Berkshire shareholders that “derivatives are financial weapons of mass destruction, carrying dangers that, while now latent, are potential lethal”. Buffett was named world’s wealthiest in March with a net worth of $52 billion by the Forbes magazine in its annual ranking of the richest billionaires. The losses incurred by the companies across the world in derivatives have emerged as one of the biggest factors behind the ongoing crisis in the global financial markets. While the impact has been seen in India as well, the magnitude is nothing when compared with the US and Europe. In an interview with PTI, K V Kamath, head of India’s largest bank ICICI Bank and newly-appointed president of apex industry chamber CII, said last week the total derivatives-related exposure of the country’s all banks put together might be just a quarter per cent of their $500 billion balance sheet. — PTI
|
|
SAIL out of steel alliance
New Delhi, May 4 The ISA is an umbrella body of leading steel-makers, including JSW, Essar and Ispat, offering them a common platform for policy decisions. Recently, the leading steel makers have been blamed by the government of forming cartels to jack up prices taking advantage of the rising demand. “We felt that the ISA needed to do more on promoting steel use and sharing of data between the utilities, a function which is being now performed efficiently by INSDAG,” a SAIL spokesman said. However, ISA president Moosa Raza could not be contacted for his comments on the issue. Tata Steel had also withdrawn from the alliance some time back. The ISA has been spearheading the campaign against the government’s move to set up a regulator in the steel sector to monitor prices and imposing export duty on steel. The ISA had been instrumental in launching a sustained campaign against the move to disincentivise steel exports as well as demanding export levy on iron ore. Its campaign on export duty received a set back recently with the finance minister proposing up to 15 per cent export duty on steel in a bid to curb the metal prices which have risen by 49 per cent in the last one year. — PTI
|
|
BSNL ‘disconnects’ Tata
Indicom, RCom
Bathinda, May 4 Confirming the fact, general manager, BSNL (Bathinda zone), Vinod Parkash, said: “It is true that the PoI has been scrapped as both Tata and RCom were not paying their dues to the BSNL. Though I can not tell how long the matter was lingering, it would have exceeded over two years.” When contacted, a Tata customer care executive said: “We are aware of the problem but the BSNL has disconnected the link to STD calls, as BSNL is the service provider. But we have been trying our level best to sort it out soon.” Expressing his inability to restore the network, Vinod Parkash said: “The decision has been taken up at the national level and after receiving the orders, I just complied with it. The situation is same throughout the country, wherever the network was provided by the BSNL. These private companies just try to put the blame on us rather than disclose the actual facts for which they are guilty.” However, senior officers of Tata and RCom could not be contacted. Lashing out at the companies, customers from various cities rued: “The networks are being run by big houses. They must ensure uninterrupted service which they claim in their advertisements.”
|
|
|
MRTPC initiates probe against FMCG firms
New Delhi, May 4 Taking cognizance of recent reports, the MRTPC has directed its investigative arm DGIR to look into FMCG manufacturers' reducing the grammage of their products without a corresponding cut in prices. According to sources, the commission has also observed that the manufacturers did not even bothered to inform the public about decrease in the volume. “No steps were taken to inform the consumers about the reduction in the weight. The producers are passing the smaller quantities for the same price .... which is not exactly achieved by the consumers,” said sources in the commission. The commission is suspecting that it is prima facie appearing to be a deceptive practice by manufacturers. Whenever there is a slight reduction in the price, the companies announces it with much fanfare in electronic and print media, but in this case they even did not bother to put a notice. This is an “unfair trade practise” under Section 36 A of the MRTP Act, 1969. — PTI
|
|
Trident Group eyes Rs 300 cr from retail venture
Ludhiana, May 4 The group, that opened its second home lifestyle products retail store under the brand name ‘Homescapes’ in the city today would invest Rs 20 crore towards opening more such stores in the current fiscal. “We plan to have 30 more stores this year and over 300 in the next three years across the country. This is likely to bring in a revenue of over Rs 300 crore,” P.K. Markanday, president, terry towel division, Trident Group, said. The company, which is the fifth largest towel manufacturer in the world, has interests in home textiles, yarn, paper, chemicals, energy and IT. It intends to use its international experience towards product selection in retail outlets. “This segment, by far, is untapped and by opening our stores and offering products under our brand name through these stores, we intend to give an international shopping experience to our customers,” said Markanday. He added that a vast range of existing customers had refined tastes and were looking for world-class products. “But the range is not diverse. Through these stores, we intend to bridge that gap. We would cater to income segments from the middle to niche groups.” |
|
Commuted amount of pension not taxable
by S.C. Vasudeva Q. I had retired as AGM from Punjab State Co-op. Bank Ltd., Chandigarh, on May 31, 2007. Employees’ provident fund commissioner has sanctioned me pension under the Pension Scheme 1995, which I have got commuted and have received Rs.51,000 as commuted pension and the rest of pension is paid to me at the rate of Rs 829 per month. The bank has also framed the employees’ pension scheme, which is contributory and contribution at the rate of 5% of the pay was deducted from the salary. I had opted the scheme from November 1, 1995 and the bank has sanctioned me pension at the rate of Rs 4,644 per month. My questions are:- 1. Whether the commuted pension received from the Employees’ provident fund commissioner is taxable or not. 2. Whether the contributory pension received from the Punjab State Co-op. Bank Ltd. is taxable or not. — Pawan Kumar Singla, Sunam A. Your queries are replied hereunder: (a) The commuted portion of the pension is not taxable. (b) The status of the taxability of the amount of contributed pension received would depend whether the same has been approved under the provisions of the Income-tax Act 1961, (the Act). If the same has been approved, the commuted portion of such pension would be exempt from tax under Section 10(13) of the Act. However, the monthly payments, if any would be taxable. Medical reimbursement Q. I get reimbursement of domiciliary medical expenses incurred by me and my wife on production of doctor's prescriptions consultation fee and cash memos from chemists. As and when me or my wife are hospitalised, the company reimburses to me the medical expenses. I wish to know if I have to pay any Income-tax on reimbursements, thus received. — K.C. Nanda A. The reimbursement of medical expenses to an employee by the employer to the extent of Rs.15,000 in a year are exempt from tax. In respect of expenditure on hospitalisation, the amount paid by the employer in respect of an expenditure incurred by an employee would be exempt from tax, if the medical treatment is in a hospital maintained or approved by the government. In case the treatment is in respect of prescribed diseases or ailments, the expenditure incurred would be exempt, if the same has been incurred in any hospital approved by the chief commissioner having regard to the prescribed guidelines. IT return Q. I am lodged in distt. jail, Rohtak, for the last about one year. I am facing income tax problem. The facts are stated hereunder in brief: 1. That I am executive director of a private ltd. company dealing with real estate. 2. That the company furnished its return for the A.Y. 2005-06 showing details of purchase of agricultural land and asset had been shown in the balance sheet and source of investment was also mentioned in the audited balance sheet/documents. 3. Thereafter, a case was taken up by the department under scrutiny and the company was served with notice from time to time Under Section 143(2)/142(1) duly served; but the same could not meet out the requirements of the department. Even the another Director of the company informed the DCIT in writing that the director of the company who has actually been dealing with the real estate business, is under judicial custody. Hence, the relevant papers relating to A.Y. 2005-6 can not be produced. 4. But the DCIT proceeded further Under Section 143(3) of the I.T. Act, 1961 and on December 18, 2007 passed order ex-parte and treated the unexplained entries in the return as income of the company amounting to Rs.66,87,960 and ordered to pay a sum of Rs.32,50,230/- within 30 days. Also order Under Section 271(1) passed for furnishing inaccurate particulars of income. 5. Subsequently, following the orders, the DCIT seized the company's accounts in the Bank leaving zero balance, and proceeding further also. The company also issued advance cheques to ICICI Bank for some loan, the same are likely to be bounced due to the passing of ex-parte orders by the I.T. Department. 6. Stay application was filed but the same rejected. — Suresh Kumar Bhatia A. The matter should be taken up for an appeal before the commissioner of income-tax. He should be requested that permission be allowed to seek the help of the concerned director in connection with the compilation of various requirements of the department. The learned CIT(A) has all the powers for giving such an opportunity to the company for the purposes of complying with requirements of the Tax Department. |
|
Fourth straight week of gains
by Lalit Batra Last week, the market clocked gains for a fourth straight week on the back of strong global cues of easing of credit woes. Both benchmark indices — BSE Sensex and Nifty settled above key levels of 17,600 and 5,200. The markets globally took umbrage on the fact that the Federal Reserve on Wednesday cut its key interest rate by a quarter of a percentage point to 2 per cent. It was the seventh reduction in the federal funds rate since the central bank began fighting a credit crisis in the second half of last year. Back home, the RBI surprised the markets by hiking CRR by another 25 basis points taking it to a total 8.25 per cent with effect from May 24. Both repo rate and reverse repo rate were left unchanged. The Sensex has risen 19 per cent from its low of 14,809 touched on March 17, 2008. However, inflation remains the biggest concern for the Indian stock market. The measures taken by the government to control inflation have also added to uncertainty on corporate profit. Also, given that parliamentary elections are scheduled next year (in May 2009), the government may leave no stone unturned in its attempt to rein in inflation, in the process creating uncertainty on corporate profits. Nevertheless, the structural growth drivers of the Indian economy remain intact — India’s economy is expected to witness a decent-to-strong growth for a long period of time due to favourable demographics. Acceleration in infrastructure creation will be another driver of strong growth in India’s economy. Surya Pharma Surya Pharma, engaged in manufacturing, developing, and marketing of various bulk drugs/active pharma ingredients from the last 16 years has come out fairly robust in fourth quarter results. Net profit rose by 56 per cent to Rs 12.79 crore in the quarter ended March 2008 as against Rs 8.17 crore during the previous quarter ended March 2007. Sales rose by 90 per cent to Rs 156.48 crore in the quarter ended March 2008 as against Rs 82.12 crore during the previous quarter ended March 2007. Menthol & Mint is now a major activity at Surya. Mint manufactured by it is in great demand around the world for flavouring confectionery, chewing gum, cigarettes and toothpastes. The promoters of the company have recently hiked its stake from 25 to 35 per cent in two tranches. Going forward, this year we expect Surya to report a turnover of close to Rs 600 crore and a profit after tax of Rs 65 crore resulting into an earnings of over Rs 40. The company’s stock is trading at Rs 122 which discounts its earnings by just over three times, which we believe is cheap by any standards and re-rating of the stock, may be soon on cards. |
|
| HOME PAGE | |
Punjab | Haryana | Jammu & Kashmir |
Himachal Pradesh | Regional Briefs |
Nation | Opinions | | Business | Sports | World | Letters | Chandigarh | Ludhiana | Delhi | | Calendar | Weather | Archive | Subscribe | Suggestion | E-mail | |
