The Tribune, Chandigarh, India

	Industry priority, says Badal Shivani Bhakoo Tribune News Service Ludhiana, February 13 Chief Minister Parkash Singh Badal has assured the industry that its problems will be sorted out soon as the industry remains on top on the priority list of the state government. He said he would make it sure that the industry got its due benefits from the PSEB and the Punjab Pollution Control Board (PPCB) in the mixed land areas declared in the recent master plans by the state government. Badal said some important issues of the industry in the state need to be addressed immediately and action would be initiated without delay. Members of the United Cycle and Parts Manufacturers' Association (UCPMA) today apprised him that streamlining of VAT refund was the major issue, which the industry was facing in the state. D.S. Chawla, president, UCPMA, said the department was asking to submit Form C and H on the quarterly basis for applying the refund, which had stalled the process as these forms were to be given by dealers outside Punjab. "We are not able to get the forms on time because of various reasons. The entire industry depends on the dealers for getting refund. Huge amount has been held up with the department due to this problem. The total amount held-up is more than the total working capital of the units which is resulting in financial crunch and the production is also suffering in units", said Chawla. Manjit Singh Khalsa, chairman, UCPMA, said,"The CM has given an assurance that on this particular issue, he will convene a meeting of officers and industrialists. We are hopeful to get a proper solution to this practical problem of VAT refund", said Khalsa. Badal has also asked Cabinet Minister for Jails and Tourism Hira Singh Gabria to arrange a special meeting of industrial representatives with him at Chandigarh so that all genuine issues raised by the industry were immediately redressed.
	CM stresses jobs for women in textile units Anshu Seth Tribune News Service Ludhiana February 13 Punjab Chief Minister Parkash Singh Badal, presiding over a joint meeting of senior officers of the Industries department and representatives of the textile industry from Punjab here today, constituted a high-powered committee to prepare a comprehensive plan for empowerment of the rural youth through skill development programmes. Emphasising the recruitment of rural women in the textile industry, the Chief Minister said industries and the government would chalk out a plan of action to "motivate" rural women and their families to come forward for employment in the textile industry in Punjab. He asked Principal Secretary Industries S.S. Channy to finalise the programme within two weeks for providing employment to the unemployed youth. Channy said employment to village women would help them uplift their economic status. Responding to the demand of industrial community for creating hostel facilities and good security environment for girls and boys to be employed in their establishments, Badal said the state government would create necessary infrastructure and fool-proof security arrangements for this purpose as suggested by the high-powered committee. He emphasised the need for constituting joint teams of senior officers of the industries and industrialists to inculcate among the youth a sense of confidence to join this drive for their welfare and also growth and the development of the state. Badal called upon the industrialists present at the meeting to start short-term training programmes to train boys and girls to meet their demand of technical and skilled people. He said they should be given excellent remuneration according to their performance. Later, Badal, in an interactive session with scientists of Punjab Agriculture University, called for giving a new push to the agriculture economy through extensive research and extension programmes to increase productivity and generating more income for the farming community. He said the Punjab government had already released Rs 20 crore to PAU and announced that Rs 75 crore would be given every year for meeting the financial needs of the university.
	FADA for fitness certification of vehicles Ruchika M. Khanna Tribune News Service Chandigarh, February 13 The only way to control the rise in road accidents is to ensure the road worthiness of all vehicles, including cars. This single step will go a long way in making road driving in India safe. As a result, the Federation of Automobile Dealers Association (FADA) is now asking the government to introduce legislation that will make periodic inspection and certification of passenger cars mandatory, which will help prevent rising road accidents in the country. Talking to TNS here on the sidelines of the Auto Mall exhibition, S P Shah, president of FADA, proposed that the inspections should be done at regular interval of three years by authorised car dealers. “This can be done on the lines of inspection and certification system in the UK and other developed countries. In the UK alone, there are over 19,600 garages that are authorised to carry out inspection and certification of cars," he said. Shah said the Motor Vehicles Act provides for an annual testing of commercial vehicles for emission, road safety and worthiness by the Regional Transport Officers (RTO). "But this system has failed to deliver the desired results," he said, adding that FADA was already in dialogue with other stakeholders for introduction of fitness regime for all categories of vehicles without waiting for change in law. “We are also talking to different insurance companies to offer incentives on renewal premium in case the car owners go in for a road worthiness certificate. One insurance company has agreed to offer financial incentive in insurance premium,” he said. Shah said since most car dealers were facing a shortage of trained manpower, “We are keen to start a education programme for youngsters (10+ 2 passouts) wherein they will be trained as car salesmen, insurance agents and spare part salesmen. We are in talks with car dealers in Chandigarh and plan to set up this academy here,” he added.
	Germany logs zero GDP growth Berlin/New Delhi, February 13 The German economy, the largest in Europe, registered zero growth in the December quarter, indicating a weak recovery in the region. However, the French economy expanded at 0.6 per cent in the fourth quarter of last year. Snapping two straight quarters of economic growth, German GDP witnessed zero expansion in the 2009 December quarter. According to Germany’s Federal Statistical Office (Destatis), the recovery of the country’s economy “lost momentum” at the end of 2009. “... the GDP in the fourth quarter of 2009 stagnated at previous quarter’s level (zero per cent) upon price, seasonal and calendar adjustment,” Destatis said. In the second and third quarters of 2009, Germany’s economy expanded 0.4 per cent and 0.7 per cent, respectively. France's National Institute of Statistics and Economic Studies said GDP grew 0.6 per cent in December quarter. “French GDP increased by 0.6 per cent in fourth quarter of 2009, after 0.2 per cent (growth) in the previous quarter. On the whole year, GDP fell by 2.2 per cent, the largest drop since World War II,” it said in a separate statement today. Both Germany and France had exited recession last year. — PTI
	Investor Guidance Bonus share income taxable before one year by A.N. Shanbhag Q: Recently, I got bonus shares from Reliance in the ratio of 1:1. As a result, the stock exchange quote for these shares were reduced to one half on the transaction day i.e. from Rs. 2,250, it came down to Rs. 1,125. This means that there is no actual benefit to the bonus allotment. Now if I sell these shares, including the bonus shares, need I pay any capital gains tax? My understanding is that I need not pay any tax: a. I held the original shares for more than 10 years; b. Even if bonus shares are held for just 2 months by now and I have not paid any cost directly, I need not pay tax because these shares have been allotted at an indirect cost by reducing half of the share price on the transaction day when these were actually allotted to me. 2. Bonus shares if are really allotted free of cost then after one year if these are sold, no tax is leviable even after deducting their zero cost of acquisition from the sale proceeds. Please confirm. — J K Kanojia A : You will have to compute the long-term gain on the original shares by subtracting their indexed cost from the current market price at which you have sold these shares. You have also earned short-term capital gains on the sale of bonus shares. Since the cost of acquisition of the bonus shares is nil, the entire sale proceeds of the bonus shares will be construed to be your short-term gains. Yes, this is very unkind to the investors but this is how the law is. It is slated to be more unkind because the lawmakers are contemplating to introduce some dissuading measures for bonus stripping on the same lines as the existing measures in place for dividend stripping. NSC income Q: I have taken National Saving Certificates (NSC) worth Rs. 20,000 in 2005-2006. I never claimed the NSC accruals so far. Can I claim the interest on the Rs. 20,000 in this financial year? If I do not claim any interest till the point of maturity, then all accumulated interest may become taxable. Is this correct? At maturity, suppose I get Rs. 38,000 (Rs. 20,000+Rs. 18,000 interest). Can I show this Rs. 18,000 interest as income & deduct it from section 80C? — Ravi Kurtadikar A. The portion of Section 80C related with the NSC states, “Any sum paid or deposited in the previous year by the assessee as subscription to any such savings certificate…”. The interest accrued on NSC for a financial year, for the first 5 years out of its term of 6 years, is deemed to be deposited in the NSC during that financial year. Consequently, if you have not claimed the benefit of Sec. 80C during the year of its accrual, it is not possible for you to claim the same for any subsequent years. The tax is also required to be paid on accrued interest. If you have failed to pay it, you may pay the same during any subsequent years, along with the interest for late payment of tax. Dividend income Q: I want to know whether dividend income, which is exempt in the hands of the recipient on which dividend distribution tax is paid, will be treated as dividend income in case of a trust. — Amit N. Shingi A : The definition of income of a trust has an entirely different connotation from what is normally understood as income. In the case of dividends, whether DDT has been paid or not, dividends paid by some specified companies is not considered as income whereas it is treated as income when received from other companies. If the trust is for charitable purposes the definition of income to be excluded is different from the definition of income to be excluded as applicable to trusts for private religious purposes or for a class of beneficiaries. Remittances to NRIs Q : This has reference to remittances that residents of India can make to NRIs. Income tax liability of the person who remits $1,00,000 per financial year for maintenance of close relatives abroad. Income tax liability of the donor who gifts $2,00,000 per financial year to any person abroad and income tax liability of recipient of fund (donee). Definition/ meaning of close relative mention for remittance of funds. — Loknath Aggarwal A : Basically an Indian resident can send up to $100,000 per financial year (Apr-Mar) to close relatives abroad. Another $100,000 per financial year can be gifted (not necessarily to close relatives). There is no income tax liability per se that is attracted on the donor. Obviously the donor needs to have acquired such funds that are being transferred by legitimate means. As far as income tax liability on the recipient of the money is concerned, the same would depend upon the income tax laws of the country and tax domicile that the recipient belongs to. Close relatives means as defined under section 6 of the Indian Companies Act. The section specifies an extensive list of relations which space constraints prevent us from reproducing, suffice it to say that close family is covered. The authors may be contacted at wonderlandconsultants@yahoo.com
	Aviation Notes Copter crashes on the rise, authorities sleep by K.R. Wadhwaney The recent Director-General of Civil Aviation (DGCA) probe has pinpointed several causes - pilot-made, technical snags, bad weather, poor visibility and inadequate maintenance -- for the crash of Bell 430 helicopter. In the tragic mishap in September, 2009, not only Chief Minister Y.S.Rajeshekhar Reddy has perished but his death has also left a political storm in Andhra Pradesh. Amid many commissions and omissions, the attention of pilots was distracted for more than five minutes as they searched in vain for options in the Flight Manuals. According to investigation, the pilot had not gone through the mandatory recurrent simulator training. As there was the acute shortage of manpower, the helicopter had not been subjected to mandatory tests. In fact, there were so many series of lapses that the tragedy was waiting to happen. Since 1990, there have been 54 helicopter crashes. This means, about three a year. This is the worst record in the world of helicopter flying. The powers that-be are fully aware of it, but the authorities have stayed in slumber resulting in loss of precious lives. As this important probe has been made public, it will be of great significance if investigations on other mishaps, including alleged molestation of a hostess in the cock-pit, are made known. The DGCA should exercise its powers and it is not only an apex body in the administration but also a parent body for discipline and adherence to rules and regulations. If it works firmly, the incidents of “drunk flying” and unruly passengers undertaking flights and misbehaving with cabin crews will reduce. Nothing is known about 2-3 footballers misbehaving with a set of crew on board the private airline. While some foreign countries, like the USA, have announced that VIPs will not be exempted from 'security checks, Indian passengers are being harassed when they undertake flights on domestic sectors. Recently, actress Koena Mitra was humiliated while being frisked at Bangalore airport. It is shameful that such unruly incidents should occur on Indian airports with actresses and other VIPs. The pity is that neither Bangalore's private developer nor security have reacted in the matter. According to International Air Transport Association, airlines worldwide will continue to face hardships for another three years. If the situation obtains, as it is at present, some no-frill airlines may declare bankruptcy. The scenario is very murky even for well-known carriers.
	Rolls-Royce, HAL to set up joint venture Shubhadeep Choudhury Tribune News Service Bangalore, February 13 British and Indian aerospace giants, Rolls-Royce Group and Hindustan Aeronautics Ltd (HAL) will set up a joint venture firm in India to manufacture civil aero-engine components and sub-systems for export, Ashok Nayak, chairman of HAL, told TNS here. “The JV would take off soon,” he said. Asked about the size of the investments being made by the two partners for the JV, Nayak replied that the venture would be a small one initially. Rolls-Royce, it is understood, will use the JV for sourcing of components and systems for many of the engines it makes. Rolls has been sourcing ring forgings for their civil aircrafts engines from HAL since 2003. The company’s engines power passenger planes like Airbus and Boeing, as well as a wide variety of military aircraft and marine vessels. For HAL this is an opportunity to expand revenues from its non-defence business, which last year brought in less than 5 per cent of its total revenue of Rs 10,373 crore. India is an old customer of Rolls-Royce’s military engines with its fleet of Jaguar fighters, and currently the Hawk advanced jet trainer, powered by Rolls engine.
	Panel to ease investment norms Tribune News Service Jammu, February 13 Chief Minister Omar Abdullah has directed for constitution of a committee, headed by principal secretary, Industries and Commerce, Anil Goswami, to work for easing the procedure for obtaining various no objection certificates by the investors for launching their ventures in the state. Responding to the demand to this effect, put forth by J&K State Council of the Confederation of Indian Industry (CII), in its meeting with the CM here, Omar said the government would look into all aspects of making the procedures more easy and soft to encourage investors. He said he would take up the matter of granting concessions to the investors on Central taxes with the Union Finance Minister. He said the state government was keen to develop industrial sector and enhance the job opportunities for youth along with economic growth and development.