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Gas Row
Skoda to launch small car in 2011
Gail signs pact for buying gas from RIL's KG-D6
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Panel for disposal of
VAT refunds
Boeing’s 787 Dreamliner by Dec
Market Update
Tax Advice
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Gas Row
New Delhi, August 30 Rubbishing Anil Ambani Group's charges of "hoarding" gas and creating "artificial scarcity", RIL executive director and head of oil and gas business PMS Prasad said customers for about one-fourth of the initial 40 mmscmd of gas from KG-D6 fields are yet to draw due to failure at their ends. Anil Ambani Group, which is fighting a legal battle with Reliance Industries for obtaining gas at a price of $2.34 pet mmBtu had alleged that RIL was deliberately under producing to create artificial scarcity. The Supreme Court is to hear the case from October 20. In a letter to Petroleum Secretary RS Pandey, Prasad said of the customers identified by the government to receive the initial 40 million standard cubic meters per day of gas, NTPC, Dabhol, Essar and GAIL are yet to draw a single unit. NTPC, which was allocated 2.7 mmscmd, is yet to sign a contract, while Ratnagiri Gas and Power — the owner of Dabhol — has signed a contract for 2.7 mmscmd but has not begun drawing yet. Essar and GAIL between them are expected to start taking 4 mmscmd of gas by next month. "Of the allocated quantity of 40 mmscmd, allocation to the extent of 9.4 mmscmd remains un-operational till date," he wrote. "No customer who has been allocated gas by government, has been denied gas for reasons attributable to RIL." RIL said several firms had sought KG-D6 gas at government-approved price of $4.2 per mmBtu and demanded "existing customers" in various sector be identified immediately so that production can be ramped up to 80 mmscmd. "We request that the government allocate gas to the existing customers in various sectors so that the production from KG-D6 can reach 80 mmscmd in line with the approved development plan (for the fields)," Prasad wrote on August 28. RIL, he said, was supplying 37 mmscmd of gas to customers identified by the Government. Without naming the Anil Ambani Group firm RNRL which had issued statements and released advertisements in newspapers charging RIL of "hoarding" gas and creating "artificial scarcity", he said "the ridiculous allegations" reflected "utter ignorance" of gas business and "incomprehension" of economics of complex large scale deepwater project. "Since the government has already approved a price formula for 5 years, it is impossible to understand how any contractor can now benefit by not producing gas especially when there is so much demand as to immediately consume all 80 mmscmd gas at price approved by the Government." "RIL in fact has been flooded by requests for supplies which it has been taking up with the Government for allocation to these consumers as it continues to ramp up production," he wrote. — PTI
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Skoda to launch small car in 2011
Chandigarh, August 30 Talking to TNS here last night, Thomas Kuehl, board member, Skoda Auto India, said Yeti would be showcased in India in January 2010 and will be launched commercially later next year. The small car will be in the Hyundai i-10 price bracket. “This car has crossed the feasibility study stage, and is in the final stages of design. Cars below Rs 5 lakh constitute nearly 80 per cent of the total Indian market. India is predominantly a small car market and we have a clear strategy to grow in the Indian market,,” said Kuehl, who is heading the company’s India operations. The small car will also be a completely knocked-down unit. All Skoda India models, including the Superb, Octavia and the Laura are CKD units and are assembled at the company's plants in India, at Aurangabad and Chakkan near Pune. Yeti, on the other hand will be in the same price bracket as Laura. Skoda India registered a 38 pc volume growth in 2008 over the previous year selling around 16,250 cars across models. However, it enjoys only a six per cent market share currently in the B+ segment, while it is currently the market leader in the premium segment (cars priced between Rs 13-26 lakh) with a 55 per cent market share. Kuehl said the company was also planning to increase its dealer network from the present 60 to around 90 by 2011. "We plan to add 10 dealerships a year," Kuehl said. He added that the company would now focus on penetration in the tier-II and tier-III cities that are the main markets for sub-Rs 5 lakh cars. |
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Gail signs pact for buying gas from RIL's KG-D6
New Delhi, August 30 GAIL signed a Gas Sales and Purchase Agreement (GSPA) on August 28 for buying 2.6 million standard cubic meter per day of gas from RIL's KG-D6 fields at Government approved price of $4.2 per million British thermal unit. "We have signed the GSPA and gas supplies are likely to begin from September 3," a GAIL official said. The state-run firm will use the gas sourced from KG-D6 at six LPG production plants. The government had placed LPG plants at priority number three after fertiliser and power plants, for receipt of KG-D6 gas. Other sectors identified included city gas and steel. RIL has so far contracted gas supplies to 15 fertiliser firms, 19 power plants and three steel makers. —
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Panel for disposal of
VAT refunds
Chandigarh, August 30 A decision to this effect was taken at a meeting chaired by Chief Minister at the Chamber of Industrial and Commercial Undertakings (CICU) here today. Badal asked the Excise and Taxation Department to carry out the entire exercise within 15 days, especially in Ludhiana, Jalandhar and Amritsar, in the first phase. He asked the FCT to simplify the procedure of the payment of VAT refunds and said unwarranted formalities involved in the process should be done away with. The CICU explained to the Chief Minister that the scenario of industry, especially in Ludhiana, was dismal due to frequent power cuts and non-payment of refunds and sought his personal intervention to save the industry. The Chief Minister directed the PSEB to immediately allow the industry to install generators of the desired capacity to cope up with the prevailing situation. |
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Boeing’s 787 Dreamliner by Dec
Chicago, August 30 “This new schedule provides us the time needed to complete the remaining work necessary to put the 787’s game changing capability in the hands of our customers. “The design details and implementation plan are nearly complete and the team is preparing airplanes for modification and testing,” Boeing chairman, president and chief executive officer Jim McNerney said. — PTI |
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Market Update
The Nifty closed at 2009 peak ignoring any possible fallout from drought and inflation. The market rose in all five trading sessions in the last week.
Meanwhile, global markets rallied to 10-month highs buoyed by renewed hopes that the global economic recovery is gathering pace. Investor optimism about the global economy soared to its highest level in nearly six years, with portfolio managers putting their cash back into equity markets, says a global fund manager survey. In the coming weeks, the market may consolidate as some money is pulled out of the market by investors for applying in the IPO of Oil India which is stated to open on 7 September. the government has fixed a price bond of Rs 950-1050 per share. Besides, movements in global markets, foreign funds activity and progress of India’s monsoon may continue to influence sentiment on the domestic bourses. Meanwhile, the debut of state-run hydropower firm NHPC would be closely watched by investors as it would set the tone for other companies looking to mop up funds through the primary market. IDBI Bank
Investors looking to invest in the PSU banking space may invest a part of it in the scrip of IDBI Bank Ltd which has numerous re-rating triggers waiting to explode. These triggers may play out in the next 12 to 18 months and therefore investors should have a medium term perspective on this bank. IDBI Bank is one of leading public sector banks of India. It was set up as the private banking arm of erstwhile Industrial Development Bank of India (IDBI) in 1994. In 2005, IDBI transformed itself into a full-service commercial bank after merging its commercial banking arm, IDBI Bank, into itself. More recently, the amalgamation of United Western Bank (UWB) with IDBI Bank gave the latter the muchneeded branch network to enhance its retail presence. Key triggers
IDBI Bank, which had been operating on a wafer thin net interest margin (NIM) of around 1 per cent in the past, is expected to see some improvement on the margin front, as its deposits are likely to get re-priced at lower rates in the current fiscal. The bank is also substituting its high-cost borrowings with deposits in order to contain its cost of funds. The government’s proposal to infuse capital into it will give it the much-needed capital to boost its balance sheet. A capital infusion will be a major catalyst for the bank as it would facilitate the bank’s efforts to achieve higher growth and profitability, and thus lead to the re-rating of the stock. The bank has a huge portfolio of quoted and unquoted investments which could be another major source of funds when needed. The bank could unlock value from these investments and boost its profitability. Some of the companies in which IDBI Bank holds a significant stake include NSE, LIC, IDFC, IFCI, NSDL, CARE, ARCIL AND SIDDBI. The risk to our recommendation is the increase in NPAs due to economic slowdown and failed monsoon. |
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Tax Advice
Q. I have a PPF account with State Bank of India, Rohtak, opened about 20 years ago. It carries only my sole name with nomination in the name of wife. I wish to make it a joint account, so as to facilitate withdrawal as the bank does not carry the signature of the nominee. According to bank officials, the rules do not permit this facility.
Kindly advise whether I can avail the facility. If allowed, please cite the rules. — MM Lal A. A perusal of the Provident Fund Scheme 1968 indicates that there is no provision for the opening of a joint account. The scheme, however, provides for a subscriber to nominate a person who will be entitled to receive the amount standing to his credit in the event of subscriber’s death before the amount has become payable, or having become payable, has not been paid. Home loan rebate
Q. Please clarify whether those living in a government accommodation and also paying home loan instalment (construction) can get rebate from income tax (principal and interest). — Pomila A.
The deduction for the repayment of amount borrowed for the construction of a residential house is allowable under Section 80C of the Income-tax Act 1961 (the Act). The deduction is, however, subject to a maximum amount of Rs 1 lakh. It may be added that above monetary limit specified under Section 80C of the Act also covers the deduction in respect of deposits in the Public Provident Fund, payments towards the premium amount paid for the purchase of National Saving Certificates etc. The interest paid on amount borrowed for construction of a residential house is allowable against income from house property. The above deductions are admissible even if you are living in a government accommodation. Interest on PO MIS taxable
Q. Apropos to your reply regarding exemption of interest earned on deposits beyond five years. Please clarify if interest on Post Office MIS is exempt from tax. I shall then shift to six years MIS in place of 9 per cent Senior Citizen Savings Scheme for which I pay tax. — RS Bhatnagar A. The interest earned on deposits under Post Office Monthly Income Scheme is not exempt from tax. It may be added that the deduction is available in respect of term deposit made for a period of not less than five years in accordance with a scheme framed and notified by the government under Section 80C of the Act. The interest earned on such fixed deposits is, however, taxable and not exempt from tax. Form No. 16
Q. I retired from a bank job under VRS Scheme on May 31, 2001. No Form No. 16 was issued to me by the bank for period 01.04.2001 to 31.03.2002. My advocate detected that the income tax was over deducted to the tune of about Rs 45,000. He wrote various letters to the Income-Tax Department and bank for the issue of Form No. 16 so that tax rebate can be claimed. Till now we have no communication either from the bank or from the IT department. My question is what is way out left for me to claim the rebate? — Naresh Chander Rabra A. You can approach the Bank Ombudsman with a complaint regarding the non- issuance of Form 16 in respect of the tax deduction at source from your income. However, the refund of Income-tax for the assessment year 2002-03 may be very difficult to obtain unless you approach the Central Board of Direct Taxes and the Board considers your request on compassionate grounds.
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Skoda Auto India, a part of the Volkswagen Group, will launch its SUV, Yeti and a small car (in the 1-1.2 litre category) in the next two years. While the company is planning to launch Yeti in 2010, the small car will hit the roads in 2011 and will be priced below its entry-level car, Fabia.
