The Tribune, Chandigarh, India

India wants Germany to relax export control laws
Trade target set at € 20 billion by 2012

Tapping potential

Germany is India's largest trading partner in the 27-nation European Union

There is good military-to-military cooperation between the two nations

Berlin, December 12
Prime Minister Manmohan Singh wants Germany to relax its stringent export control laws to help open 'new horizons' for high-technology trade with India, as the two countries vowed to increase the bilateral trade volume nearly 40 per cent to €20 billion by 2012.

“There is vast untapped potential for high technology trade between India and Germany and I conveyed to Chancellor Merkel that relaxation of German export control laws will open new horizons for such trade. This will be to our mutual benefit," Singh told reporters after talks with German Chancellor Angela Merkel last night, On Germany's part, Merkel said there was no "trust deficit" between the two countries on the issue of high technology transfer.

Merkel's response came when a reporter asked why Germany puts restrictions on the transfer of high-technology to India and whether there was a trust deficit in easing them.

"Our partnership with India is of a strategic nature. Our goals are ambitious and there is no trust deficit, on the contrary we are cooperating very well in this area," said Merkel, adding "We are taking our strategic cooperation seriously." The Chancellor said both sides were working on modalities to ease such restrictions.

"On the transfer of high technology for peaceful purposes, the Prime Minister mentioned the potential for high technology trade between India and Germany. We are cooperating closely on this, and will work towards a smoother cooperation," she added.

Merkel also said there is a good military-to-military cooperation which should be seen as a positive development in bilateral ties.

At their joint news conference, both Singh and Merkel said the two countries have decided to step up efforts to increase bilateral trade to € 20 billion by 2012 from the existing level of around 15 billion euros.

Singh said despite the economic downturn the two sides were hopeful that the target set will be ‘achieved’. Germany is India's largest trading partner in the 27-nation European Union. — PTI

Trade fair concludes
Trade centres announced for Amritsar, Mohalli
Neeraj Bagga
Tribune News Service

Amritsar, December 12
The Punjab government would set up permanent trade exhibition centers at Amritsar and Mohali for felicitating trade, said Deputy Chief Minister, Sukhbir Singh Badal while addressing the concluding ceremony of the 5-day Punjab International Trade Expo (PITEX) 2010, organised by the PHD Chamber, here today.

He said these centres will be conceptualised on the lines of New Delhi’s Pragati Maidan to promote indigenous handicrafts, technological and other items.

He added that work on local trade exhibition center would kick off next year and would take two years to complete. He hoped that once the center was established, trade exhibitions would become a routine affair.

Chairman, Punjab Committee, PHD Chamber, Rajiv Bali, informed that trade inquiries worth more than Rs 250 crore were recorded and over 2 lakh visitors visited the fair during the past five days.

He claimed that PITEX 2010 recorded participation of more than 30 per cent exhibitors from foreign countries and remaining 70 per cent from leading trade and industries from across the country.

Senior vice-president, Rawalpindi Chamber of Commerce and Industry, Mian Ateeq said his Chamber would hold a similar trade expo by the same name as PITEX next year and invited participation from India.

Over 100 overseas deals under lens

New Delhi, December 12
The finance ministry has begun its maiden investigation into over 100 offshore ‘financial structuring deals’ undertaken by Indian business entities in foreign tax havens to allegedly evade the taxman’s net.

The multi-pronged probe has been undertaken by the international taxation wing of the Income Tax department and the foreign taxation unit in the Central Board of Direct Taxes (CBDT).

A number of investments and deals to the tune of billions of rupees have been already executed in tax havens like the Mauritius, Isle of Mann, Cyprus, British Virgin Islands and Bermuda, amongst others. These deals will be scrutinised by the investigators, who are also travelling to some of these countries to collect additional information. — PTI

I-T handled Vodafone case well: FM

Mumbai, December 12
Finance Minister Pranab Mukherjee praised the efforts and professional competence of the Income Tax department in handling the Vodafone tax dispute efficiently in all the forums. The department expects Rs 2,500 crore in tax collection for the Vodafone case.

At a review meeting held here yesterday involving Chief Commissioner of Income Tax, Director-General of Income Tax (Inv), Commissioners of Income Tax at Mumbai, and CBDT Chairman S S N Moorthy, Mukherjee exhorted the tax officers to put their best foot forward to achieve the budget collection target fixed for the Mumbai region.

Advance tax in the Mumbai region has been growing at 18 per cent and with the TDS collection now catching up and the Rs 2,500 crore that the department expects to collect in the Vodafone case, the budget collection target would be met from the Mumbai region, IT Chief Commissioner (Mumbai) PP Srivastava said. — PTI

Market Update
Advance tax numbers may provide cues
by Lalit Batra

Last week, the market witnessed a steep slide, with small-cap and mid-cap stocks taking a beating on concerns over regulatory crackdown on companies indulging in price rigging and an ongoing investigation into telecom corruption scandal.

The Bombay Stock Exchange Sensex lost over 2 per cent to close the week at 19,508. Foreign funds have also resorted to net selling on the bourses last week.

In the coming days, the market may not see much pull-back due to concerns on spike in commodity prices including crude oil.

Investors will closely monitor the date on advance tax by top Indian firms for the third advance tax instalment due on the 15th of this month.

The figures will provide a cue on third quarter corporate earnings. The Reserve Bank of India (RBI) undertakes a mid-quarter policy review this Thursday and the governor has expressed discomfort with the current levels of inflation.

PSB issue

The Punjab & Sind Bank (PSB) is coming up with an initial public offering (IPO) of 4 crore equity shares of a face value of Rs 10 each. The issue is priced at Rs 113-120 a share. The bank’s business is principally divided into retail banking, corporate/wholesale banking, priority sector banking, treasury operations and other banking services. The bank’s advances over the past five years have grown at a compounded annual growth rate (CAGR) of 36 per cent and its deposits have increased at a CAGR of 28 per cent.

On September 30, the gross NPA ratio of the bank stood at 0.92 per cent, which is one of the lowest among the public sector banks. In addition to the low GNPAs, the bank also has a high provision coverage ratio of 87 per cent. The bank also has a comfortable capital adequacy ratio at 13.07 per cent. The downsides to the issue are that the bank has a low CASA ratio at 25.1 per cent, which is one of the lowest in the public sector banking space.

Bank stocks have corrected sharply in the last one month, the PSB IPO may not offer substantial listing gains, but may offer reasonable returns in the long run. Investors may apply at cut off.

Tax Advice
Rebate for severe disability raised to Rs 1 lakh
by SC Vasudeva

Q. This is my second letter about Section 80(4). The first was dated 12.10.2010 (not published so far).

In reply to the letter of Mr KK Sanoon (The Tribune dt 27.9.10) you had informed that limit of 50,000 had been raised to Rs. 75,000/- w.e.f. Assessment Year 2010-11.

The same thing has been repeated now in reply to a query of Mr Manjit Singh in The Tribune dt 1st November 2011.

In my first letter I had requested for the necessary reference in support of this change. I repeated the same request now again.

The particulars of the circular, amendment of rule etc. may kindly be published because here our friends in this line say that there is no such change.

— R.S. Bhatia

A. The available deduction under Section 80U of the Income-tax Act 1961 (The Act) for the Assessment Year 2010-11 remains Rs. 50,000/- in case of a person suffering from a disability. However, the deduction for a person suffering from severe disability has been raised from Rs. 75,000/- to Rs. one lakh for the Assessment Year 2010-11. This aspect has already been clarified in reply to a query published on 22.11.2010.

Advance tax

Q. I have a query regarding tax. “Sometimes, employer deducts TDS more than it is actually required to be deducted, and further other sources of income are not exactly known before end of April, and at the same, it is difficult to get refund in time, so with that end in view, the query, as below, has been raised before your goodself. Would you please advise.

i) If TDS is effected from salary/ pension, whether balance tax on other sources of income (interest etc.), (which is usually below Rs. 10,000/-) if becoming due, could be deposited by an assessee, on actual basis, at his own level after 31st March after getting in hand Form 16 from employer and details of income on a/c of interest. If so, please specify up to which date?

ii) Will it attract penal interest, if yes, under which section and at what rate?

— S.L. Mittal

A. Your queries are replied hereunder:

(i) In case the additional amount of tax payable is below Rs. 10,000/-, the same can be deposited at the time of filing tax return without interest and/or penalty.

(ii) In case amount of tax payable is Rs 10,000 or more, it is advisable to make the payment of tax in three instalments as advance tax which fall due on 15th September, 15th December and 15th March of the financial year in respect of which the tax is being paid.

The amount of advance tax is computed with reference to the estimated total income for the financial year at the rates in force applicable for the relevant assessment year. The income-tax so computed is reduced by income-tax deductible at source during the financial year.

In case the amount deposited as advance tax is 90% of the amount of assessed tax no interest would be leviable.

Pan card

Q. Please tell me exact address & phone No. of office for applying for PAN at Ferozpur. Also clarify if photostat copy of SBI Bank Account can be considered proof of entity & address of applicant. I am widow of a Kendriya Vidyalaya Sangath an employee and now the P.O. demands PAN for opening account.

— Jagir K. Aulucle

A. An application for allotment of Permanent Account Number is to be made with NSDL in form no. 49A. Such an application should be filed with the center based at Nehru Place, New Delhi.

The form is required to be filed along with proof of identity of the assessee, proof in respect of permanent address and a copy of passport size photograph.