The Tribune, Chandigarh, India

	IOC, RIL in Fortune 500 list US retailer Wal-Mart Stores tops the list New York, July 11 Eight Indian companies, including IndianOil Corporation and Mukesh Ambani-led Reliance Industries, have made the cut on the list of the world's 500 largest companies compiled by Fortune. The league of 500 elite companies for 2010 is topped by US retailer Wal-Mart Stores, followed by oil giant Royal Dutch Shell and another oil major, Exxon Mobil, in that order. Besides IOC and RIL, the other Indian companies on the list are Tata Steel, Tata Motors, Bharat Petroleum, Hindustan Petroleum and Oil & Natural Gas and SBI. Tata Motors has made an entry into the list for the first time this year, while seven other Indian entities, which were part of the list in the previous year as well, are also featured on this list. The list also features Citigroup, ArcelorMittal, Pepsico and Motorola, four companies led by people with Indian roots. IOC has the highest rank of 125 among the featured Indian companies, followed by RIL at the 175th spot, SBI (282), BPCL (307), HPCL (354), Tata Steel (410), ONGC (413) and Tata Motors (442). According to the magazine, IOC had revenues to the tune of $ 54.28 billion, RIL $ 41.08 billion, SBI $ 28.21 billion, BPCL $ 26.59 billion, HPCL $23.88 billion, Tata Steel $21.58 billion, ONGC $21.44 billion and Tata Motors $19.5 billion. Vikram Pandit-led Citigroup is at 33rd place, with revenues of $108.78 billion, while NRI billionaire L N Mittal's ArcelorMittal bagged the 99th position with revenues worth $65.11 billion. Pepsico, run by Indira Nooyi, was ranked at 171st place with revenues of $43.23 billion and Sanjay Jha's Motorola is at the 391st place, with $22.06 billion in revenues. Interestingly, American companies have cornered 139 seats on the list, followed by Japan with 71, and then China, with 46 seats. This year, there are 12 Fortune Global 500 companies run by women, compared to 13 last year. The magazine said Wal-Mart Stores had revenues to the tune of $408.21 billion, while Royal Dutch Shell and ExxonMobil raked in revenues worth $285.12 billion and $284.65 billion, respectively. Others on the list include BP at fourth place, followed by Toyota Motor (5th), Japan Post Holdings (6th), Sinopec (7th), State Grid (8th), AXA (9th) and China National Petroleum (10th.) — PTI
	Irda clears IPO guidelines New Delhi, July 11 The sectoral regulator Irda today said it had finalised the IPO guidelines for insurance companies and referred these to Sebi for final approval which is expected soon. "We are expecting the guidelines shortly. We have given our observations. The matter is currently with Sebi," Insurance Regulatory and Development Authority (Irda) chairman J Harinarayan told PTI. He further said the valuation norms for the companies had been finalised in consultation with the Institute of Actuaries. "Idra, in consultation with the Institute of Actuaries, has given its views on the IPO. Sebi has to clear it now," he added. Irda, which has been working on the initial public offer guidelines along with Sebi, is likely to come out with a draft for public comments before issuing the final norms. Several private sector insurers, including Reliance Life, have shown interest in tapping the capital market to augment their resource base. The government had proposed to ease the norms to allow insurers to list after five years of operation, instead the current 10-year practice. As per the Insurance Act, promoters having 26 per cent stake can offload equity after 10 years of operation. The legislation also empowers the government to reduce the mandatory period. Irda had already notified the disclosure norms, necessary for providing details about the operations and balancesheets on quarterly and yearly basis. The IPO guidelines will deal with minimum norms that a company must fulfil before hitting the capital markets. Norms for correct valuation, disclosure of operating results and profit and loss account and filing of the draft red herring prospectus are the three essentials that a company have to fulfil when going for public float. Besides the Life Insurance Corporation, 22 private companies are offering life insurance policies. The general insurance sector has 21 players which include four state-owned companies. — PTI
	Market Update Results to set tone for Sensex by Lalit Batra Surprisingly, last week turned out to be one of the best weeks for the markets in many months. Indian markets surge was even more surprising as the RBI had increased the repo and reverse repo rates the previous week. The surge in the world markets aided the sentiment back home. Globally, the sentiments turned positive after US retail sales grew at the fastest pace in four years (4 per cent growth year to date) and the IMF raised its forecast for global economic growth. Back home, the sentiment got a boost due to the revival in the monsoon which were 2 per cent above normal last week, allaying concerns on food inflation and the raising of the growth rate to 9.5 per cent for 2010 by the IMF. The rains have revived after weak monsoon last month. Rainfall deficit for the country as a whole narrowed down to 10 per cent till last Thursday. Crop planting suffered last month as rainfall was 16 per cent below normal. The weather office expects this year’s rains to be at 102 per cent of the long-period average. The rains would help raise farm output, boost rural incomes and lower food inflation. The market sentiment seems to have improved following positive global economic data. However, the coming week is crucial for the stock markets as corporates results will set the tone for the market. Good results will propel the markets in new highs on the other hand if the results are below expectations, market may go into tailspin. Provogue India PIL is a manufacturer and retailer of apparels for men and women, and operates through three platforms, namely Provogue Studios, national chains and multi-brand stores, and Pro Mart (off-price lifestyle department stores). It also has presence in the infrastructure space through its 75 per cent subsidiary, Prozone Enterprises Pvt. Ltd. (PEPL). With a meagre 4-5 per cent penetration of organised retail in the Indian market and favourable demographics (working age profile, rising disposable income, urbanisation, and female working population), the organised retail sector is expected to grow at a compounded annual growth rate (CAGR) of 28 per cent over 2009-2015 to reach a size of $ 71 billion. Thus, the long-term growth drivers for the industry remain intact. With the economic growth for economy, the organised retail industry has again started witnessing a strong upliftment with players reporting same-store sales growth in double digits. Going forward, we expect this momentum to continue and the growth is likely to be more pronounced in the coming quarters. The Provogue brand is positioned as a lifestyle brand targeting the premium segment. PIL has resumed its retail expansion plans (expansion was put on hold last year due to global slowdown), and aims to add around 50-60 stores in 2010-2011. Add to this the company intends to extend its range of offerings to include all lifestyle products such as perfumes and shaving creams. This move is likely to help the company increase its same-store sales as well as operating profit margin (OPM). The companys subsidiary, PEPL will add to the company’s valuations once the projects undertaken by it are completed. PEPL currently has six projects underway situated in Aurangabad, Coimbatore, Nagpur, Indore, Jaipur and Lucknow. In the backdrop of India’s strong economic growth in coming years, Provogue India’s business of retail and realty both have bright future. Investors may add the scrip to one folio on declines with a two years perspective.
	HCL signs mega deal with Saudi group New Delhi, July 11 HCL Technologies today said it had signed a "mega" outsourcing agreement with Saudi Arabia's Al Majdouie Group to provide end-to-end services for a period of seven years for an undisclosed sum. The scope of the deal includes developing infrastructure, implementing Oracle's e-business suite with over 70 modules and managing and running them and commissioning and managing a data centre and disaster recovery services, HCL said in a statement. HCL said its end-to-end IT services would enable the Al Majdouie Group, having interests in the transportation, steel, automobiles, real estate and travel businesses, to streamline business processes and integrate seamlessly across all group companies. The IT services firm said it would require to blend all its outsourcing strengths -- applications and infrastructure capabilities, industry knowledge and expertise -- to help Al Majdouie achieve fundamental transformation at the enterprise level. "We are confident of delivering significant cost-efficiencies and business benefits to Al Majdouie Group," HCL Technologies Infrastructure Services Division senior vice-president Kiran Bhagwanani said.— PTI
	3G services will not come cheap: Bharti Tribune News Service New Delhi, July 11 As was expected, the first round of warning that the services in the next generation 3G spectrum would not be cheap has come. Bharti Airtel has said since telecom operators had to pay dearly in the auction to acquire the 3G spectrum, the services thus rolled out will not be cheap. "Take the example of Delhi or Mumbai. The amount for spectrum that has been charged is close to Rs 3,500 crore each... Just to recover licence fees and input cost, it works out to be Rs 700-900 per month," Bharti group chairman Sunil Mittal has said, a news agency reported. Airtel was one of most successful bidders in the auction winning 13 circles, including Delhi and Mumbai, at a total cost of Rs 12,295.46 crore, the highest among service providers. The company could not achieve the objective of a pan-India 3G footprint as the prices rose beyond a reasonable level due to various factors like the auction format, a severe shortage of spectrum and also ensuing policy uncertainty, it had said. Incidentally, Bharti, Vodafone and Reliance Communications managed to win 3G spectrum in Delhi and Mumbai, which could lead to a tariff war in these two metros. Elaborating on the rationale for differential tariffs, Mittal said, "My view is that certain circles, it will be circle dependent, like C circle and all will not be very expensive, but in circles that have gone very high in the 3G auction, price will have to adjust for itself." "The pricing of subscriber tariffs have to be based on the input cost. Any industry relies on input cost and here, the input cost is spectrum and it has gone high," he said. Since Bharti did not get pan-India spectrum for 3G, the company has started a dialogue with operators in circles where it is not present for an arrangement to offer undisrupted 3G services to its subscribers.
	Tax Advice No tax on gift to grandchildren by SC Vasudeva Q. I have remitted a sum of Rs 1,00,000 by cheque from our joint bank A/c under single payment of LIC taken in favour of my married daughter. The premium under the policy exceed 20 per cent of the actual capital sum assured. Whether this amount would automatically become a gift given to my daughter or some other formality is required in this respect. Please note this payment is made not through her bank A/c but directly through out joint bank A/c. How the maturity proceeds of the policy will be treated for IT purpose in her hand. Please also advise if I gift Rs.1,00,000 to my son-in-law by cheque, or purchase a single premium policy of LIC on his life, will be treated as gift and it attract any IT in his hand? Whether a gift can also be made to the children of my daughter without attracting any tax implications? — Inder Pal Sharma A. You are entitled to the effect or keep in force insurance on the life of your married daughter in view of the provisions of Section 80C of the Act. However, you will be entitled to a deduction of so much of premium as is not in excess of 20 per cent of the actual capital sum assured. In calculating the amount of capital sum assured, value of premiums agreed to be returned and any benefit by way of bonus will not be included. The amount paid as premium by you towards the life insurance policy will be treated as a gift to your daughter. The gift so made is not taxable under the provisions of the Act. The amount received by your daughter on maturity of the policy will be taxable in her hands in view of the provisions of Section 10(10D)(c) read with explanation to sub section 3 of Section 80C of the Act. This is on account of the stated position in the query that the premium paid by you exceeds 20 per cent of the capital sum assured. The amount of premium paid towards the policy taken on the life of your son-in-law will not be allowable as a deduction under Section 80C of the Act. Though the amount will be treated as a gift to your son-in-law, yet no tax would be payable by your son-in-law on such a gift. However, in case the amount of premium exceeds 20 per cent of the actual capital sum assured, the amount received on the maturity of the policy will be taxable in the hands of your son-in-law. You can make a gift to your grandchildren (children of your daughter) without attracting any tax liability. Form 15H Q. My total income from pension, bank/post office interest has increased over Rs 2,40,000 for the financial year 2009-10. To avoid payment of income tax, I had in December 2009 deposited Rs 30,000 in tax saver scheme. Hence, no tax liability. However, in May 2009, I submitted Form 15H to my bank to avoid TDS in view of the fact that my tax liability would be NIL. — Ramlal Kharbanda A. You have correctly filed Form 15H as the same is permitted to be filed by senior citizen under Section 197A of the Income-tax Act 1961 (the Act). It may be added that you will have to file your tax return for the assessment year 2010-11 (financial year 2009-10). This is in view of the proviso to Section 139 of the Act which requires the filing of tax return by a tax payer, who has claimed or is intending to claim a deduction under Chapter VI-A of the Act, which Chapter includes section 80C of the Act. NSS amount Q. I have been the holder of NSS A/c since November 1988. I intend to withdraw the whole amount (appx. Rs 25,000) during the current financial year. Whether the entire amount so withdrawn will be treated as income for the IT purpose? What will be the impact if the amount is withdrawn after April 2011 when the Direct Tax Code is in force? Which option is beneficial to me? I had opened an account under Senior Citizen Saving Scheme during June 2006 which will mature in June 2011. Can it be extended? If so, for what period and whether benefit under section 80C will be available as I don’t intend to withdraw a part of the deposit and keep the entire deposit during the extended period. What are the formalities to be complied with for the purpose? — P.D.S. Sharma A. The amount withdrawn from NSS account shall be added to your other income and taxable on the basis of applicable rate to the total taxable income for the previous year in which the amount is withdrawn. The issue with regard to the taxability should remain same even after the introduction of Direct Taxes Code. The amount under Senior Citizen Savings Scheme can be extended for three years by making an application to the deposit office within a period of one year after the maturity period of five years. The extension will be deemed to have been made from the date of maturity irrespective of the date of application. The amount already deposited in an account under the scheme would not be covered for the purposes of allowing deduction under section 80C of the Act, provided a deduction has already been claimed in respect of the said amount. Reimbursement Q. I am a Punjab Govt. pensioner and my date of birth is February 20, 1946. My income from all sources during the current financial year will be Rs 2.80 lakh. I have spent Rs.2 lakh on the by-pass-heart surgery of my wife in Fortis Hospital (Mohali) during the financial year 2009-10 and received Rs.1.50 lakh as reimbursement charges from the Punjab Govt. in the current financial year. She is dependent upon me and has no sources of income of her own. Will I become senior citizen for income tax purposes during the current financial year and can claim the benefits of senior citizen for the assessment year 2011-12? Whether the amount of Rs.50,000 not reimbursed by P.G. will qualify for tax rebate under Section 80C of the Act? — Kuldeep Singh A. You will be entitled to claim the benefit of higher limit applicable to a senior citizen in the assessment year 2011-12 as you will attain the age of 65 years on February 20, 2011. The amount of Rs 50,000 spent by you for the bypass surgery of your wife is not deductible from your income. The amount of Rs.1,50,000 reimbursed by the Punjab Government towards the bypass heart surgery of your wife will be treated as a profit in lieu of salary and taxable in your hands.