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India Inc set to revive: Survey
RCom launches GSM service in Delhi
Tatas eye home loan market
Areva gears up for India’s nuke sector
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Hindalco aluminium gallery at Panchkula
Forbes survey: No Indian in young women billionaire club
Inflation impacts budgets for
Tax Advice
Appointed
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India Inc set to revive: Survey
New Delhi, August 3 The slowdown in the manufacturing growth rate is due to some emergent issues and constraints, including rising cost of raw materials, oil price hikes, appreciation of rupee, hardening of interest rates and considerable time lags and inordinate delays and bottlenecks in implementing projects. FICCI has made a comprehensive survey of the latest growth trends in the manufacturing industry sectors for the period April-March 2007-08. According to the findings of the survey, there are some issues and constraints hurting manufacturing growth in recent months and some pro-active reform measures pending action by the government. According to the survey, overall manufacturing growth rate to be around 9.5 per cent in 2008-09. The industry association believes that while the present situation may continue for next two-three months, the manufacturing industry would be able to revive and achieve higher growth during the terminal period of the financial year 2008-09 provided the government takes some pro-active reform measures to redress the genuine grievances of the manufacturing industry. The survey covers about 100 manufacturing sectors belonging to basic goods, intermediate goods, capital goods, consumer goods - both durables and non-durables, including FMCG, food and beverage sectors. The sectors surveyed cover about 70 per cent and more of the specific industry sector. Recently announced first quarter results of many leading companies across many segments in the manufacturing sector reveal higher growth in sales and net profit. Many companies have resorted to higher price hikes of 2-20 per cent and 10 per cent on an average to cope up with the rising prices and are making strategies, including cost cutting, product development and sales promotion measures, for future higher growth, says the survey. Besides, a sizable segment in the manufacturing sector, including cement, steel, chemicals, automotive industries and consumer goods industries, have undertaken projects for expanding capacities with substantial impact on manufacturing growth. FICCI believes that farm loan waiver scheme and the proposed salary hikes of government employees will help to generate more demand for manufactured items. In addition to this, there is a need for stimulating consumption and demand, reducing interest rates and no further cuts in custom duty on manufactured goods. On the other side, there is the need for ensuring relief package for exporters, increasing rate of depreciation, reducing corporate tax rate and correcting anomalies due to inverted duty structure existing in the tax structure and arising out of free trade agreements and regional trade agreements. The survey also states that there is need for adopting appropriate raw material policies, improving regulatory environment, helping capacity building of small medium enterprises, skill development and improving infrastructure for helping the industry to achieve lower cost, improved quality and better performance and for higher manufacturing growth. |
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RCom launches GSM service in Delhi
New Delhi, August 3 RCom has been offering CDMA-based mobile service throughout the country and has recently been allowed by the government to start GSM service simultaneously. The company has chosen the national capital to start its services under the dual technology licence. To begin with, the company has offered over 1,000 connections to its employees as part of soft launch and after review RCom would soon offer services on commercial basis, sources said. Asked whether services would be offered in other parts of the country, too, simultaneously, sources stated that the company has been rolling out networks in all circles on war footing and as soon as the network is ready the services would start but no deadline has been fixed. In fact the company would hire passive infrastructure from another group company Reliance Infratel, which owns the tower business of the CDMA company. RCom has said the rollout of GSM services would help it target the fast-growing subscriber additions of seven million subscribers every month and address the telecom requirements of the existing 172 million GSM customers with the launch of nationwide GSM network, in addition to its CDMA network. The company has targeted to cover 23,000 towns and six lakh villages under its GSM service by the end of the year. It has received a loan of $750 million (Rs 3,000 crore) for a 10-year period from China Development Bank to fund its nationwide GSM launch. The loan would essentially finance the company’s GSM equipment order placed with Chinese network major Huawei. The order is spread over a three-year period and is likely to be finalised soon. The order will have both 2G and 3G components. — PTI |
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Tatas eye home loan market
New Delhi, August 3 The group’s newly incorporated financial services arm Tata Capital is soon expected to file its application with the National Housing Board to start the housing finance business. “We expect to start our home loan business by March 2009 after getting all the necessary approvals,” Tata Capital’s managing director and CEO Praveen P Kadle said here while announcing ambitious plans to expand into businesses like housing loan, commodity and debt broking, private equity and wealth management. Admitting being a late-entrant in these high growth businesses, including lending operations, Kadle said the company would look to make up for that with quality product offerings for its customers. Besides better rates, Tata Capital would also focus on offering a better product in terms of services as well as process and IT systems support, he noted. Tata Capital is a wholly owned subsidiary of Tata Sons, the apex holding company of Ratan Tata-led Tata Group, and its portfolio includes personal loans, car loans, distribution and broking, wealth management, SME finance, infrastructure finance, capital markets and private equity. Besides Tatas, another leading corporate house Anil Ambani Group is also gearing up to soon start a full-fledged housing loan business. — PTI |
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Areva gears up for India’s nuke sector
Mumbai, August 3 France-based Areva has two separate companies-one for nuclear power generation, Areva NP, and another for transmission and distribution, Areva T&D. Areva NP is a joint venture between Areva and Siemens and holds 66 per cent stake in the venture. “We are world’s largest player in the nuclear power sector and to remain as number one firm, we cannot afford to neglect India,” Areva T&D’s global chief financial officer Karim Vissandjee said here. “We are very active behind the scene. Areva will play a significant role in Indian nuclear power sector,” Vissandjee said. “If we enter into the nuclear power sector, it will be done through a separate subsidiary. We are waiting for the final guidelines from the government,” he said. Areva NP provides nuclear products and services to power generation players. The company designs and builds power plants, research reactors and related components. It also supplies nuclear fuel and its services include engineering, maintenance and repair services. — PTI |
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Hindalco aluminium gallery at Panchkula
Panchkula, August 3 This is the eighth such galleries in the country to be opened on a commercial basis, A. Jayagopal, general manager (market development), Hindalco Industries, said. He said environmental friendly utility of aluminium was a major factor that was driving advanced nations like Japan and Europe to embrace aluminium products. While per capita use of aluminium in India is 1.3 kg, the same in a country like Japan is over 25 kg, which speaks volumes of the compatibility of aluminium, asserted Jayagopal. The objective behind the gallery is to stock products made by Hindalco and thereby enable the end-user to see, touch and feel quality aluminium products like windows, doors, ladders, shutters, roofing sheets, false ceiling and furniture before taking an informed purchasing decision, he said. |
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Forbes survey: No Indian in young women billionaire club
New York, August 3 The 20-strong list of youngest women billionaires aged between 24 to 49 years, published by the online edition of the US business magazine Forbes, include celebrity writer J K Rowling and Barack Obama’s presidential campaign finance chief Penny Pritzker. “The question likely on many a men’s minds: How many of these ladies are single? Only two are - with certainty - single: Turkey’s Serra Sabanci (35) and Filiz Sahenk (41). Nothing is known about the marital status of Chu Lam Yiu,” Forbes said in a report on its website. Regardless of being single or married, self-made or inherited, these women have “limitless earning potential and decades ahead to see their investments and business ventures flourish,” it said. Emerging from some of the world’s biggest economies, taking on corporate roles their grandmothers and even mothers never would have dreamt possible,” the report added. According to the report, the number of young billionaire women under the age of 40 jumped to seven in 2007 from just two a year earlier. While the under 50 club grew to 20, from 17 in 2006. Pointing that just two per cent of the world’s billionaires are women under the age of 50, the report said the list was diverse and impressive. It “includes the world’s richest author, Barack Obama’s finance chief, four Turkish sisters, two former factory workers who created their own billion-dollar fortunes, and two heiresses still in their 20s.” The youngest female billionaire in the list is Hind Hariri, the youngest child of slain Lebanese Prime Minister Rafik Hariri who inherited a stake in the family’s construction, banking and media holdings. She also happens to be the overall second youngest billionaire in the world, according to the Forbes list of richest people published earlier this year. Apart from Penny Pritzker (49) and J K Rowling (42), others in the list include 26-year-old Chinese Yang Huiyan, four people from Turkey - Begumhan Dogan Faralyali (31), Hanzade Dogan Boyner (36) and Vuslat Dogan Sabanci (37). Other names are China’s Chu Lam Yiu (38), Zhang Xin (43), Dinara Kulibaeva (40) from Kazakhstan, America’s Margaret Magerko (42), Abigail Johnson (46), Jean Pritzker (46), Nancy Lerner (48) and Winnie Johnson-Marquart (49); Turkey’s Arzuhan Dogan Yalcindag (43), Russia’s Elena Baturina (45) and Germany’s Susanne Klatten (46). There are about five 30-something female billionaires and six of the seven women in their 20s and 30s and nine of the dozen in their 40s inherited their money from their fathers. “The youngest self-made female billionaire in the world is Hong Kong citizen Chu Lam Yiu, the 38-year-old head of Huabao International, a company which makes fragrances and flavorings for cigarettes, detergents, beverages, dairy products and cosmetics,” the report noted. —
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Inflation impacts budgets for leisure shopping New Delhi, August 3 The study, based on responses of 3,000 middle and high income groups in cities, spread over 25 days in July recommended further measures like using car pools, public transport and restricting spending to essential items. It found that increase in inflation, based on the Wholesale Price Index (WPI), from 7 per cent to above 11 per cent has forced middle class families to cut their average budget for entertainment, eating-out and fancy shopping from Rs 5,000-6,000 per month to less than Rs 2,800 per month. However, inflation could not dent the spirit of the higher income group. An average high-heeled family continues to spend Rs 20,000 per month on leisure that includes movies and music. Meanwhile, middle income males who generally spend anywhere between Rs 400 and Rs 1,000 per month on tobacco products like cigarettes, pan masala, gutka have not really cut on this expense. Also, problems in the family budget did not impact the women folks who continue to give business to beauty saloons and cosmetic products, the study said.
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Tax Advice
Q. A cinema hall in central zone, Delhi (in operation since 1976 as a single screen theatre) was ordered closed by the Delhi High Court in 2005 (as it was incurring recurrent losses) and no further business was allowed to be transacted. MCD was duly informed of the court decision immediately. What is the property tax liability of this closed cinema? Is there a concession for a closed cinema theatre? Is there any court judgement in this regard in Delhi or else where? If not, is there a case pending in any court? The information is needed as under the unit area method of calculation of property tax the multiplying factor for a cinema theatre is three which puts a lot of economic strain as there is no income from the closed theatre, which awaits public auction as per the same court decision.
— P. Singh, New Delhi A. I understand that the house tax is normally not charged in respect of a property which has remained unoccupied on account of the reasons beyond the control of the owner provided the information thereof is given in advance to the municipal corporation. However, I would suggest that you should consult a lawyer who is dealing with the subject as the issue raised by you is not related to Income-tax. Income tax
Q. I need your guidance for F.Y. 2007-08. For the said year, suppose income of a person is as follows:- Gross pay = Rs 2,20,510, including HRA = Rs 7,083 Income writing scientific articles for newspapers/ magazines etc (after subtracting expenditure incurred on writing) = Rs 5000 income from NSC interest = Rs 18,180. Person lives in a rented house in a village. He has claimed deduction under Section 80QQB in respect of income from writing articles. He has computed total income as under: Salary Rs 2,20,510 Interest NSC Rs 18,180 Articles fee Rs 5,000 Rs 2,43,690 Less exemption Rs 1,12,083 Rs 1,31,607 Tax to be paid at the rate of 10 per cent + education cess at the rate of 3 per cent (i) Is the calculation of tax right? (ii) What should be the minimum annual rent paid by the said govt. Employee residing on rent in village so that the entire HRA received by him during the year Rs 7,083 is exempted from tax? — Surinder Kumar
Jindal, Patiala A. The answer to your queries is as under: (i) The amount which is not to be included in the total income of an assessee in respect of the house rent allowance shall be the least of the following: a) the actual amount of such allowance received by the assessee in respect of the relevant period; or b) the amount by which the expenditure actually incurred by the assessee in payment of rent in respect of residential accommodation occupied by him exceeds one-tenth of the amount of salary due to the assessee in respect of the relevant period; or c) an amount equal to- (i) where such accommodation is situate at Mumbai, Kolkata, Delhi or Chennai, one-half of the amount of salary due to the assessee in respect of the relevant period; and (ii) where such accommodation is situate at any other place, two-fifths of the amount of salary due to the assessee in respect of the relevant period, You will have to pay an yearly rent of Rs 28,427 so as to get the exemption of the amount of Rs 7,083. The above amount exceeds 1/10th of your salary i.e. Rs 21,343 (without taking into account HRA of Rs7,083) by Rs 7,084. The least of the two being Rs 7,083, the same would be exempt from tax. (ii) Deduction under Section 80QQB of the IT Act, 1961, (the Act) is allowable in respect of a Royalty income from books of scientific nature. The section does not provide for a deduction in respect of articles of scientific nature. Presuming that you have spent Rs 28,427 towards the house rent and are, thus, entitled to the exemption of Rs 7,083 under section 10 (13A) of the Act, your total income would work out at Rs 1,36,607 after allowing deduction under section 80C of the Act. The tax thereon for assessment year 2008-09 would work out at Rs 2,740, including the education cess. Immovable property
Q. Thanks for awaring the general public about law points through your writings on May 31. You have written as per foreign exchange management regulation-2000, NRI can not purchase farm land pl intimate its publication in which law journal with month it is published/its notification no. and from where it is available. — Amrik Singh, Ludhiana A. The Foreign Exchange Management (Acquisition and Transfer of Immovable Property in India) Regulations 2000 provides vide clause (4) that a person of Indian origin resident outside India may acquire immovable property in India other than an agricultural property, plantation or a farm house. These regulations should be available on the website of the Reserve Bank of India. The regulations are also contained in foreign exchange management manual published by all the big publishers like Taxman, Bharat etc. |
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Appointed
Chandigarh, August 3 The post of CMD was lying vacant following demission of office by A. C. Mahajan on June 30, 2008. Before joining Allahabad Bank, Kamath was the executive director of Bank of India for a period over two years.
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Chandigarh, August 3
