The Tribune, Chandigarh, India

	5 of top 10 Cos lose Rs 24k cr Mumbai, November 22 As many as five companies among the elite club of top-10 Sensex firms have witnessed an erosion of over Rs 24,000 crore from their market capitalisation previous week, while RIL maintained the top position with a valuation of Rs 3.49 lakh crore. In the week ended November 20, the five firms - ONGC, MMTC, NMDC, BHEL and Bharti Airtel - together lost a sum of Rs 24,665.37 crore from their market valuation. However, the other five firms — RIL, NTPC, SBI, Infosys Technologies and TCS - added Rs 12,365.47 crore to their market capitalisation (m-cap). Country's most-valued firm RIL added Rs 1,388 crore to its market cap, taking its total valuation to Rs 3,49,188 crore previous week, while mining giant NMDC was the biggest loser as it shed Rs 8,445 crore from its valuation. The numero-uno RIL had a market cap of Rs 3,47,799 crore in the week ended November 13. State-run oil firm ONGC was at the second position, even though it saw a decline of Rs 3,069 crore from its market cap, with its total valuation at Rs 2,50,066 crore. Power producer NTPC inched up to third slot from fourth after adding Rs 124 crore, while trading behemoth MMTC slipped to fourth place after losing Rs 7,883 crore from its m-cap. The total market valuation of NTPC surged to Rs 1,77,360 crore, while the m-cap of MMTC declined to Rs 1,72,259 crore. NMDC stood at the fifth place followed by SBI and Infosys Technologies. The market capitalisation of NMDC stood at Rs 1,64,356.64 crore. The market valuation of public sector lender SBI stood at Rs 1,48,292 crore, while Infosys Technologies' market cap surged to Rs 1,39,173 crore. IT firm TCS added Rs 4,521 crore, with its m-cap at Rs 1,35,692.68 crore. Power equipment maker BHEL climbed to ninth position from 10th even after losing Rs 465 crore from its m-cap. Telecom services provider Bharti Airtel lost Rs 4,803 crore, with its market valuation at Rs 1,09,633.76 crore. — PTI
	Porsche Takeover Volkswagen set to be world’s largest carmaker Berlin, November 22 Europe's auto major Volkswagen is set to become the world's number one, pushing Japan's Toyota to the second place, by taking over sports car manufacturer Porsche. The boards of directors of Volkswagen and Porsche endorsed the acquisition on Friday last week, ending years of takeover struggle between the two German automobile giants, partly owned by two estranged family clans. Porsche, which made an unsuccessful bid to take over Volkswagen earlier this year, would now become the 10th brand of the VW family. Until recently, Porsche was controlled by Porsche Holding AG, a listed company owned by the family of VW chairman Ferdinand Piech, a grandson of the Porsche founder Ferdinand Porsche, and by the Porsche family. Porsche's attempt to take over the much bigger Volkswagen backfired and its CEO Wendeln Wiedekind had to leave in July. It suffered heavy losses largely due to its unsuccessful bid. Porsche racked up huge debts to get 51 per cent stake in Volkswagen, but fell short of the 75 per cent stake needed to take over the company when it could not raise the money needed due to the global financial crisis and drop in car sales. In August, the two families buried their differences and agreed to a fusion in order to protect their stakes in the company. — PTI
	‘Spectrum is tax riddle’ New Delhi, November 22 The government should clarify taxation rules regarding payments made for acquiring spectrum while working to resolve the issue of 3G spectrum allocation, according to financial consultancy firm PwC. “There is no specific provision in Indian tax laws governing the deductibility of the payments made for acquiring spectrum,” a PwC report on the telecom sector said. With the allocation of spectrum, especially 3G being an issue of concern, rules governing the same in the taxation laws also assume significance. “Since, substantial amounts are to be involved for acquiring spectrum, determining its deductibility becomes critical,” the firm said. An issue which follows the dearth of tax laws in case of spectrum is whether such payment is in the nature of capital expenditure or revenue expenditure, the firm pointed out. — PTI
	ICICI top in nurturing talent New Delhi, November 22 As many as five Indian firms, including ICICI Bank and Infosys Technologies, have made it to the list of top 12 companies in the Asia Pacific region for being instrumental in building leadership capability within their organisation. According to the list compiled by HR consulting firm Hewitt in partnership with RBL Group and US magazine Fortune, ICICI Bank emerged at the top, followed by China Mobile Communications Corp and TCL Corp, a China-based electronics goods maker. Meanwhile, the Indian arm of global FMCG major Unilever, Hindustan Unilever, was ranked at the fourth spot, Aditya Birla Group was at the sixth spot, Infosys Tech was ranked eighth and another IT major Wipro cornered the 10th slot. — PTI
	RIL ready to acquire chemical giant New Delhi, November 22 Reliance Industries is all set to make the country's biggest global acquisition if it emerges as the successful bidder for bankrupt LyondellBasell - one of the world's largest polymers, petrochemicals and fuels company. Reliance and LyondellBasell have issued statements confirming a “preliminary non-binding offer” to acquire “a controlling interest” in the world's third largest independent chemical maker. Though RIL did not disclose the offer size, industry sources said bid for LyondellBasell would be over $12 billion, making it the largest ever acquisition by an Indian firm. The biggest-ever deal involving an Indian company is Tata Steel's takeover of European Corus for $12 billion, followed by British telecom giant Vodafone's purchase of a controlling stake in Indian mobile services provider Hutch Essar for about $10 billion. Other big-ticket Indian merger and acquisitions include Aditya Birla group company Hindalco's Novellis acquisition ($6 billion), Ranbaxy's sale to Japan's Daiichi ($4.5 billion), ONGC-Imperial Energy ($2.8 billion), NTT DoCoMo-Tata Tele ($2.7 billion), HDFC Bank-Centurion Bank of Punjab ($2.4 billion), Tata Motors-Jaguar Land Rover ($2.3 billion) and Suzlon-RePower ($1.7 billion). The said deal would act as a catalyst to drive India Inc's shopping spree and would also give a fillip to the slugging M&A activity of the country. LyondellBasell would put RIL into the top echelons of chemical producers in the world. LyondellBasell last year had $50.7 billion in revenues and employed 15,000 people across 19 countries. LyondellBasell's US operations and one of its European holding firms filed for bankruptcy protections this year, weighed down by a massive debt and declining demand. The RIL-LyondellBasell deal may take a few months to conclude. The successful bidder for LyondellBasell, would be decided by the US bankruptcy court. — PTI
	Tax Advice Property purchase: Incentives for NRIs by S.C. Vasudeva Q I am an NRI and considering purchasing a house in Chandigarh. I am aware that there are tax breaks available for Indian residents, but is there any similar scheme available for NRIs (I hold an Indian passport)? I will finance part of my purchase through home loan from an Indian bank. What do I need to do in order to qualify for tax breaks, if available? — KK Mehra A The following major tax incentives are available in respect of a house property purchased/constructed in India: a) In computing the total income of an individual for an assessment year, a deduction of a sum not exceeding Rs 1 lakh is allowable in respect of the repayment of amount borrowed by the assessee from a bank or other specified entities for the purposes of construction/acquisition of a house. b) The interest paid on amount borrowed for the construction or acquisition of a house property is allowed as a deduction against income from house property. Such deduction is limited to Rs 30,000 in case of a self-occupied house. However, a higher deduction of Rs 1, 50,000 in case of a self occupied house is allowed if the amount is borrowed after April 1, 1999, and such acquisition or construction is completed within three years from the end of the financial year in which the amount was borrowed. c) The house tax paid in respect to the property is allowed as a deduction from the annual letting value. d) In case the property is let out, a statutory deduction of 30% of the annual letting value arrived at after deduction of house tax paid would be allowed to cover expenses in respect of the maintenance of the house and collection charges etc. Sale of shares Q I want to apply new issue shares in name of my major son/daughter from my bank account. Kindly let me know income arising from sale of new issue / loss from sale of new issue allotment belongs to son/daughter or me. — Ashok Kumar A It seems you intend carrying on the activity of purchase of sale and new issue of equity shares, which are purchased in the name of your major son/daughter. If you are using your own funds for acquiring such shares in the name of your son or daughter, the profit/loss arising on such sale can be treated as your income/loss as the investment has been made with funds belonging to you. The capital gain arising on the sale of such shares would be exempt from tax in case shares are held for more than a year. In case the shares are held for a period of less than one year the short-term capital gain would be taxable at the rate of 15% plus education cess. The net loss, if any, will be carried forward for eight assessment years for adjustment against short-term capital gain, if any, arising in such eight years. It may be added that the above provisions regarding exemption from tax as well as charge of tax at the rate of 15% are applicable in case sale of shares is effected through stock exchange and the sale has been subjected to securities transaction tax. IT return Q I am a senior citizen and my income is less than Rs 1,85,000. I am told that I am not required to file return of my income, but since I have PAN, the ITO must be having a separate file for me. I must tell him the reason for not filing my return otherwise he could raise objections. Is there any form prescribed for the purpose? — RD Khemka A You have been advised correctly that you are not required to file return in accordance with the provisions of the Act. The assessing officer has all the powers to issue a notice under Section 142(1) of the IT Act requiring you to file the return. In case he chooses to do so, you can file the return at that point of time in response to his notice. The income shown in the return in any case would be below the taxable limit. There is no prescribed form for informing the assessing officer. Care taking allowance Q I am a government employee. I have drawn an arrear of Rs 28,587 during current financial year as care taking allowance at the rate of Rs 200 per month from July 2003 to August 2008 and at the rate 10% of basic and grade pay w.e.f. September 2008. I am still drawing this allowance at the rate 10% of my basic +grade pay. Is this arrear and current care taking allowance taxable? If yes, how do I calculate the same? I have been assigned the duties of caretaker in addition to the duties of my original post i.e. of a translator. — Surinder Singh A The amount received by you as care taking allowance in addition to the duties of a translator would be taxable. However, the amount received being in the nature of arrears for taking the additional responsibility, the relief under Section 89 of the Act would be available to you in case your total income would be assessable at a rate higher than that, it would have otherwise been assessed. Section 80CCD Q I have opened an NPS account in the name of my 29-year-old son having no income of his own. The contribution is to be deposited by me (father) in his account during my lifetime and after that my daughter (his sister) will do so. Please advice whether we (father/sister) are eligible for deductions of the contribution under Section 80CCD or not. — Gyan Chand Gupta A According to Section 80CCD, if an assessee being an individual employed by the Central government or any other employer or any other assessee being an individual, deposits any amount in his account under a pension scheme notified by the Central government, he would be allowed a deduction in the computation of his total income, whole of the amount so deposited by him as does not exceed (a) in case of an employee 10% of the salary in the previous year, and (b) in any other case 10% of his gross total income in the previous year. The deposit of amount in the account of your son would enable him to claim a deduction to the extent specified herein above. In my opinion, you would not be entitled to claim a deduction in respect of the deposit so made.
	Market Update Bullish undertone may continue by Lalit Batra Markets may remain volatile over the next few days as traders rollover positions in the derivative segment from November to December 2009 series ahead of the expiry of the near-month November series this Thursday. The undertone as gauged from the futures & option suggest bullishness with a fresh, long build-up in the December series. Last week, the market after struggling for most part of the week made a strong comeback in the second part of the Friday that helped the indices close the week with one per cent gain. This sudden strong buying activity was supposedly on the back of deputy chief of the Planning Commission Montek Singh Ahluwalia indicating that the government had no intentions of imposing a tax to curb the inflow of foreign funds. Markets may continue to remain buoyant on the back of strong global and domestic liquidity. A global glut of liquidity has pushed stock markets across the globe sharply higher since March this year. Government and Central banks around the world have injected trillions of dollars in the past one year or so to pull the world out of recession. Investors will keenly watch the debate in Parliament on three key reform bills — the State Bank of India Amendment Bill, the Pension Fund Regulatory and Development Authority, and the Insurance Bill. Smooth passage of these bills may add to the sentiment. Sugar industry In the backdrop of protests from the farmers and Opposition parties over the fair and remunerative price (FRP) mechanism for fixing the price of cane, the Centre has repealed Clause 3B of the FRP ordinance. This had made it obligatory for a state government declaring a state advised price (SAP) higher than the FRP to pay the difference between the two prices to the farmers and, thus, literally discouraged the state governments to announce an SAP higher than the FRP. This clause being detrimental to the interest of the farmers (especially in a year of bumper cane production when cane prices are low due to a higher supply) had led to severe protests from the cane farmers and political parties especially because of the very low FRP (Rs 129.8 per quintal for sugar year 2010). Clause 3B would mean that a state government will not have to pay the excess of SAP over the FRP from its coffers and that the mills would have to pay the same instead. This development would take the entire cane pricing system back to the old regime where state governments were free to declare SAPs higher than the minimum price announced by the Centre (now the FRP against the earlier statutory minimum price or SMP). This may be a long-term negative for the sugar mills in Uttar Pradesh (and the other states where SAP has been the system for fixing the minimum cane price), as it would mean a higher minimum price in a sugar downcycle. However, in the immediate term it is likely to bring the cane pricing issue to an end, thereby ensuring resumption of supply of cane to mills by the farmers. The controversy over the FRP has led to a delay in the start of crushing for the current season (October 2009-September 2010), which may affect the recovery rate of sugar from sugar-cane.