The Tribune, Chandigarh, India

	Advance tax collection rises 20 per cent New Delhi, December 21 The advance tax collection from India Inc rose 20 per cent during the first nine months of the current fiscal compared to the same period last year, with automobiles, consumer goods and metals leading the pack. Advance tax payments by industries increased to Rs 1.13 lakh crore from Rs 0.94 lakh crore during the corresponding period last fiscal, Finance Ministry sources said. In the third quarter (October-December), the collections rose by 22.72 per cent to Rs 54,000 crore on substantial increase in advance payments from automobiles, consumer goods and metal firms. After better advance tax collections compared to last year the government expects the direct tax collections for the current fiscal to well exceed the budget target of Rs 3.7 lakh crore. Among the major companies, SBI till December during this fiscal paid an advance tax of Rs 4,695 crore, ONGC Rs 3,713 crore, SAIL Rs 2,263 crore, Maruti Udyog Rs 757 crore and Bajaj Auto Rs 540 crore. The economy during the second quarter of the current fiscal (July-September) expanded by 7.9 per cent beating estimates. As the good news continues to trickle, the recent Mid-Year Review of the economy tabled by Finance Minister Pranab Mukherjee said the growth during 2009-10 could exceed the optimistic projection of 7.75 per cent. In the personal income tax segment, the advance tax collections grew only by 4 per cent to Rs 14,200 crore till December 19 this fiscal from Rs 13,600 crore during the corresponding period last fiscal. The government in the Budget for 2009-10 has set a target of Rs 3.7 lakh crore as direct tax collection, which was later revised to Rs 4 lakh crore. Leading state-owned banker SBI paid Rs 1,795 crore as advance tax in the December quarter this fiscal, up 5.59 per cent against Rs 1,700 crore during the same period last fiscal. However, advance tax collections in the December quarter dipped for private banks like ICICI (down 51.8 per cent at Rs 301 crore), Standard Chartered (down 7.26 per cent at Rs 400 crore) and HSBC Bank (down 56.25 per cent at Rs 175 crore). Among power companies, state-owned NTPC in the third quarter has paid Rs 1,078 crore, about 68 per cent more than last year in the same quarter while Jindal Power has paid an advance tax of Rs 150 crore, up 114.29 per cent against last year. In the consumer goods segment which has also improved, Hindustan Lever has paid Rs 200 crore, up 29 per cent compared to last year in the December quarter. — PTI
	Rice Export Scam Ghana seeks India’s help in probe Ruchika M. Khanna Tribune News Service Chandigarh, December 21 The Republic of Ghana has sought the intervention of the Government of India (GoI) into the multi-million dollar rice export scam. It has asked the government to investigate the role of some Central ministries in this scam. The letter, written by State Attorney, Republic of Ghana, in August this year and made available to The Tribune through RTI, has sought the help of GoI to investigate the role of Ministry of Commerce, Ministry of External Affairs, Office of Director-General Foreign Trade, State Trading Corporation and a Delhi-based private rice export firm, into the procedural lapses and irregularities in the export of 3,00,000 bags of rice, worth over $10 million. In June, The Tribune had reported how these government-to-government exports, touted as a diplomatic goodwill gesture, were commercial transactions. The scam had come to light in June this year, after then foreign minister of Ghana Akwasi Osei Agyei was caught in the dock for allegedly using state machinery to import rice worth $10 million from India and then sharing it with private traders. The Bureau of National Investigation and Criminal Investigation Department, Ghana, are investigating his role in the rice export scam. It may be noted that there has been a general ban on export of non-basmati rice in India since October 15, 2007. However, the Ministry of Commerce issued a notification for conditional lifting of this ban by allowing export of 10 lakh tonnes of non-basmati rice to 21 countries in Africa, as a diplomatic goodwill gesture. This notification clearly specifies that the exports were to be carried out through designated public sector undertakings (PSUs) like State Trading Corporation (STC), Minerals and Metals Trading Corporation (MMTC) and PEC. However, documents available with The Tribune reveal that these exports were being referred to a third party, which is a private trading company. In the case of exports to Ghana, though the exporter is STC, exports were done through a Delhi-based private trading firm. Interestingly, when this consignment reached the Terna port in Ghana in February 2009, customs and excise officials there found that instead of the 3,00,000 bags mentioned in the manifest that accompanied the consignment, only 2,97,003 bags were actually sent. Of these bags that were sent, 807 were found empty and 594 were found caked and had to be destroyed. “None of the bags had a manufacturing or expiry date… The consignment of 3,00,000 bags of rice arrived in the country in varying states of wholesomeness and at a cost of $10,260,000, which is likely to lead to a huge loss to the importers (Ministry of Foreign Affairs and National Investment Bank),” stated the letter by State Attorney of Ghana.
	Tax on perks from April ’09 New Delhi, December 21 The government has notified the new rules for valuing perks like accommodation, conveyance and others given to the salaried class for calculation of their tax liability. Effective from April 1, 2009, the new rule may burn a hole in the pockets of salaried people and replaces the already abolished Fringe Benefit Tax (FBT). Perquisites given by the employer such as residential accommodation, conveyance facility and other benefits to the family of the employee would be added to their salary for income tax purposes. Earlier, the tax on these perks were paid by the employer in the form of the FBT that was done away with in the Budget 2009-10 by Finance Minister Pranab Mukherjee. The perquisites to be included in the taxable salary include residential accommodation given by the employer, expenses on motor car for official or personal use, salaries of the driver, gardener and even sweeper if paid by the employer and concessional education provided to the employee’s children. The valuation norms include all of these benefits, as per the notification on the official website of Central Board of Direct Taxes (CBDT). In addition to the perks like residential accommodation and conveyance, others such as travelling, free food and non-alcoholic beverages provided by the employer, any gift or vouchers received by the employee on ceremonial occasions, reimbursements for membership of a club and tour allowances would also come under the purview of this new income tax valuation system. Earlier, the perquisites were added to the salary for tax purposes, but if specified as FBT, they were to be paid by the employer and not the employee. In regard to government employees, the new valuation rules may be the same for all except for those on deputation, who will have to cough up a higher amount as tax. — PTI
	Industry – Looking Ahead 2010 Many new projects line up in Haryana Ruchika M. Khanna Tribune News Service Chandigarh, December 21 The year 2010 will see a number of infrastructure and industrial projects taking off in the region. After years of being caught up in red tapism and/or legal tangles, SEZ projects, power plants, besides some big manufacturing units will finally be commissioned in the coming year. In spite of a new industrial policy and the Punjab government’s new-found “woo industry” attitude, no major industry is likely to be commissioned in the state in the coming year. Though the state government is making all out efforts to promote itself as the new IT and agro industry hub, no major project is ready for commissioning in the coming year. Amongst the hundreds of integrated townships and housing projects that the state has sanctioned over the years, under its mega project policy, some of these projects will be ready in 2010. But what remains to be seen is whether these projects find enough takers and are successful. The much-hyped and delayed Guru Gobind Singh Bathinda refinery project, too, is expected to be commissioned only in June 2011. The refinery is a joint venture between the Hindustan Petroleum Corporation Ltd (HPCL) and Mittal Energy Ltd (MEL), and will have a carriage capacity of 18,000 million metric tonnes per annum. The downstream petro-chemical hub to be developed alongside this refinery, will also take off only after the project is commissioned. On the other hand, Haryana is expected to make up by adding several new projects in its kitty in the coming year. The industrial activity in the state will finally see the focus shifting from the National Capital Region to new places like Rohtak. The town, which is also the constituency of Chief Minister Bhupinder Singh Hooda, will now house the largest paint factory in Asia, by Asian Paints, as well as a state-of-the-art R&D centre by Suzuki. Interestingly, this is the first R&D centre being set up by the company outside Japan. However, as Haryana sees some activity in the manufacturing sector, it may not be as successful with its much-hyped SEZ projects. Though the state has an impressive list of over 96 SEZ projects, work has begun on only a select few, including the much-touted Haryana Reliance SEZ at Gurgaon and the Reliance SEZ at Jhajjar. But even these two projects have been caught up in problems, mainly because of slow process of land acquisition. While Reliance is now looking to offload its stake in the Haryana Reliance SEZ by roping in a strategic partner, the company is also looking at scaling down the size of its SEZ project at Jhajjar. Reliance has now made a request that they be allowed to develop the SEZ at Jhajjar on just 2,500 acres, rather than on 12,000 acres as was envisaged earlier.
	Auto Expo Honda to unveil small concept car Tribune News Service New Delhi, December 21 Japanese automaker Honda today said it would hold the world premiere of its concept model of a new small car at the Auto Expo here next month. “Honda New Small Concept is a concept model of a new small-sized vehicle, which Honda is currently developing, especially for India and other emerging nations,” the company’s Indian subsidiary, Honda Siel Cars India (HSCI) said. The 10th Auto Expo, 2010, begins from January 5. In addition to the New Small Concept, the company will exhibit the CR-Z Concept 2009, a concept model for a new hybrid model, which was unveiled for the first time at the Tokyo Motor Show in October this year. “At Honda, we believe in constant innovation to offer advanced technology that only makes our cars fun to drive but also addresses the ever increasing concern about the environment,” HSCI director Tatsuya Natsume said.
	Deora seeks Rs 20,870-cr oil bonds New Delhi, December 21 With Finance Ministry's defiance pushing fuel retailers into red, Oil Minister Murli Deora today requested Prime Minister Manmohan Singh to immediately issue over Rs 20,870 crore worth of bonds to state-run firms to make up for losses they incurred on fuel sales. "I met Prime Minister with a request that oil bonds worth Rs 20,872 crore be issued immediately," Deora said. Though the government had earlier this year explicitly decided to compensate IOC, HPCL and Bharat Petroleum for the losses they incur on selling domestic LPG and kerosene through PDS by way of oil bonds, the finance ministry has not issued any bonds for the three quarters. — PTI
	Industrialists concerned over steel price hike Shivani Bhakoo Tribune News Service Ludhiana, December 21 The steel-consuming industry in Punjab is in big trouble as the prices of steel has increased more than 15 per cent in the past one month. The industrialists feel that this increase will badly affect the bicycle, fastener, sewing machine, handtools, auto parts, oil expeller & machine tool industry in this part of region, especially in Ludhiana. Expressing concern over the steep price hike, the chairman of Federation of Associations of Small Industries of India (FASII), Badish K Jindal, said the government should intervene at the earliest and order the public sector steel companies not to enhance their prices to maintain the pressure on private and secondary steel producers not to hike the prices. He further added that the prices of ingot in Mandi Gobindgarh were Rs 23,900 on November 15, 2009, and today the prices of ingot were Rs 26,400. There was an increase of about 15 per cent in the past one month. The two major reasons for this increase were the announcement of price increase by SAIL chairman recently and secondly, the prices of international scrap were increased manifold. In the last month, the price of scrap in international market was between $280 and $290, which had increased to $340-$350 recently. The present rate of scrap was giving a signal of further increase in steel prices.The main steel producers were also taking the benefit of this increase and they had increased the prices by Rs 1,000-2,000 per ton. Jindal said SAIL took the bookings of steel consumers with the advance deposit but as the prices increased, they cancelled all bookings and ordered the consumers to book material on new prices. The other major public sector steel-producing companies had also informed its customers to increase the prices from December 21. Those dealing with the steel industry feel that the main steel producers produced the steel from iron ore and they had no relation with the scrap prices, but they had increased the prices just to earn huge margins. "The steel consuming industry is in trouble, as it has to fulfil its domestic and export commitments. The small steel-consuming industry works on very little margin of 2-3 per cent. And this increase will prove to be a net loss of more than 10 per cent to them", said SK Jain, another industrialist from Mandi Gobindgarh. With the current steel prices, it would be difficult for the Indian exporters to compete with China in the international market, says the business community. "As Ludhiana is a house of steel- consuming industry, this increase will hit the industry hard", said Jindal.
	3G Spectrum Auction to be as per schedule: Raja New Delhi, December 21 The government today said auction for 3G mobile spectrum would commence as per schedule from January 14 next year and allotment would be made to four private players simultaneously by August. “The Empowered Group of Ministers (eGoM) has decided to auction 3G spectrum for four slots as per original schedule,” Telecom Minister A Raja told reporters after an hour-long meeting of the eGoM headed by Finance Minister Pranab Mukherjee. Asked whether the Defence Ministry would vacate the required spectrum, the minister said, “There is a consensus in the eGoM on vacation of spectrum and it would be alloted simultaneously to all four winners by August 2010.” The government is estimating to generate Rs 25,000 crore from sale of 3G spectrum, allowing five operators, including state-run BSNL/MTNL which have already been given airwaves. Earlier, the Department of Telecom (DoT) had expressed concern over delay in vacation of spectrum by the Defence Ministry and had suggested, in its note for eGoM meeting, that only three slots should be auctioned. The government has fixed a reserve price of Rs 3,500 crore for 3G spectrum and Rs 1,750 crore for the Wimax services. Raja said it had been decided to allot spectrum simultaneously in August 2010 to all the winners in order to maintain a level-playing field. Asked how much spectrum was currently available with the DoT, the Minister declined to give details but said the decision had been taken to sell four slots. The DoT is also building an alternate optic fibre network for the defence forces at a cost of over Rs 9,500 crore enabling the defence to vacate the spectrum for commercial use. — PTI