New Delhi, November 14
The Supreme Court on Monday directed Vodafone to deposit $550 million ( Rs 2,500 crore) within three weeks in relation to a $2.5-billion tax dispute, even as the company looks for an out-of-court settlement.

Vodafone has also been directed to make a bank guarantee worth Rs 8,500 crore ($1.9 billion) within eight weeks, a Vodafone spokesman said on Monday.

Vodafone, fighting a tax bill in India over its 2007 purchase of Hutchison Whampoa Ltd’s mobile business in the country, had appealed to the Supreme Court challenging a lower court order that Indian tax authorities had jurisdiction over tax bills in cross-border deals. The tax office had asked Vodafone to pay Rs 11,218 crore within 30 days, but the British firm had said it ‘strongly disagrees’ with the calculation.

“Vodafone is confident that there is no tax liability resulting from this transaction, and all the tax and legal advice it has received remains consistent with this view,” the company said in a statement on Monday. The court said the Indian authorities could withdraw the deposit money on the condition that they would return it with interest if Vodafone won the case.

The Supreme Court will hold the next hearing for the case on Feb. 24.

Vodafone is separately trying to settle the dispute out of court. Earlier, reports suggested that the Dutch government had approached India on behalf of Vodafone’s Netherlands unit to settle the three-year-old dispute.

“We can confirm that the Dutch government has been in discussion with Vodafone and we believe it has initiated a formal process under the tax treaty between both the Dutch and Indian governments,” a spokesman said.

“The Dutch government’s intervention is a standard mechanism which can be invoked between countries to review tax matters.” — Reuters

New Delhi, November 15
India’s annual headline inflation eased slightly in October to its lowest in 10 months, possibly allowing the Reserve Bank to keep rates steady in coming months even though price rises remain above its comfort level.

Wholesale prices rose 8.58 per cent in October from a year earlier compared with 8.62 per cent in September, data on Monday showed. The figure compared with a Reuters poll forecast for an 8.44 per cent rise.

Food inflation slowed to 14.1 per cent in October compared with 15.7 per cent a month earlier as supplies improved after healthy monsoon rains, helping bring down overall inflation.

The data, coming on the heels of the slowest annual growth in industrial output in 16 months, lends support to those who advocate a pause in the Reserve Bank of India's (RBI) tightening, although others say further rate increases are needed.

“With this number against the weak IIP (industrial output) last week, our view that the RBI will not hike further in the current fiscal year becomes even stronger,” said Anubhuti Sahay, economist, Standard Chartered Bank in Mumbai.

Finance Minister Pranab Mukherjee said on Monday that the full impact of the central bank's past rate hikes on inflation had yet to be seen and that he expected headline inflation to fall to 6 per cent by March. — PTI

New Delhi, November 15
Tight liquidity conditions combined with loan growth could push interest rates skyward in the coming days, State Bank of India Chairman O P Bhatt said here today. "Interest rates have a slightly upward bias... (due to) liquidity combined with some more credit offtake, which is going to take place. So these two together may push up interest rates," Bhatt said on the sidelines of the India Economic Summit organised by the World Economic Forum.

Asked about current liquidity conditions, he said the situation is comfortable. Liquidity has come under pressure owing to the huge public issue of Coal India Ltd a few weeks ago, besides a surge in spending during the festival season. On the upcoming euro bond issue by the bank, Bhatt said, "We are planning for euro bond. We would like to go for roadshows sometime next week."

The nature of the issue is such that details on the quantum of bonds cannot be divulged, he said. Asked if the size would be 500 million euros, he said, "It could be."

Chandigarh, November 15
Worried about Chinese bicycle parts, bearing some of the oldest and prominent Indian marques, tarnishing their brand equity, the Ludhiana cycle industry has sought a ban on their import.

India imports bicycle parts for Rs 500 crore a year

Ludhiana's bicycle industry is the country's largest and manufacturers are apprehensive about erosion of their brand identity because of import of inferior quality of bicycle parts by some unscrupulous domestic importers.

"We want a complete ban on the import of Chinese bicycle parts, which has marked a severe dent on bicycle manufacturing in Ludhiana," DS Chawla, President of United Cycle & Parts Manufacturers Association (UCPMA), Asia's largest cycle manufacturers body, said.

Chawla added India annually imports bicycle parts for around Rs 500 crore and the trend is growing at the cost of local bicycle parts manufacturing.

Industry representatives says, Chinese bicycle parts bearing over 15 Indian bicycle parts brands like Dass, KW and Bhogal, to name a few are eating into the local bicycle market.

Duplicate Indian brand marking has been observed on the select bicycle parts including spoke, chain wheel, chain, free wheel, steel balls, pedals, pump, they said.

Phuman Singh, owner of a 54-years-old bicycle parts brand KW rued, "When I inquired about complaints I found that Chinese bicycle components, including pedals and chain wheel, which are our core products, bear KW brand being imported through seaport at Kolkata ." After pursuing the matter with vigor, Singh successfully managed to lead the seizure of a container carrying 20,000 pieces of Chinese pedals bearing KW brand at Kolkata. — PTI

New Delhi, November 15
Sun TV Chief Kalanithi Maran took over as the chairman of low-cost air carrier SpiceJet today and wasted no time to induct four of his nominees in the company's board of directors.

“Kalanithi Maran has been inducted into the board as the Promoter Director and has been appointed as the Chairman of the board and company,” SpiceJet said in a filing to the BSE.

Following the completion of his acquisition of a majority stake in the company, Maran has inducted four of his nominees - S Sridharan, J Ravindran, Nicholas Martin Paul and M K Harinarayanan -- as directors on the company board, it said. Furthermore, Kavery Kalanithi, the wife of the Chennai-based industrialist, has been appointed as a non-independent director on the board, the filing added.

To make space for the new board members, all four existing directors on the airline's board -- B S Kansagra, Kishore Gupta, Mukkaram Jan and Vijay Kumar -- have resigned from the no-frills carrier.

Maran had clinched a deal in June to acquire a 37.7 per cent stake in the airline for about Rs 750 crore from American investor Wilbur Ross, his investment companies and the Kansagara family-promoted Royal Holding Services Ltd.

He, however, holds a 38.66 per cent stake in the airline.

“Kalanithi Maran jointly with KAL Airways Pvt Ltd has acquired 38.66 per cent stake in the company. Their acquisition included the entire equity stake of the erstwhile promoter -- Royal Holdings Services Ltd (RHSL) - and FCCB converted equity stake held by W L Ross entities and shares offered by general public in the open offer made pursuant to SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 1997,” the SpiceJet filing said.

Before the latest management shuffle, Maran had already appointed Neil Mills as CEO of the airline , while several top officials, including the then-CEO Sanjay Aggarwal and founder director Ajay Singh, put in their papers.

The SpiceJet filing further said that S Natrajhen has been appointed as the Chief Operating Officer of the airline.— PTI

BRIEFLY

TCS’ plans
Chandigarh: The country's largest IT services provider, Tata Consultancy Services, plans to recruit about 50,000 employees in 2011, the same figure as this year's, a top company official said today. "This year we will add 50,000 people and next year we will add the same (number)," Tata Consultancy Services Managing Director and CEO N Chandrasekaran said. — PTI

PSB GM
Chandigarh: Ravinder Gosain Zonal Manager of Punjab and Sind Bank has been promoted as General Manager of the bank. He has been instrumental in increasing the busines volume of the bank in the region by 60 per cent from Rs 3,602 crore to Rs 5,575 crore. — TNS