The Tribune, Chandigarh, India

	IT industry seeks extension of sops New Delhi, February 6 The Indian IT industry has sought extension of tax benefits under the Software Technology Parks of India (SPTI) scheme. It has also sought simplification of the tax structure to encourage investments, as part of its Budget wish-list. “We have requested that the STPI scheme be extended till the DTC comes in with the right incentives because we need sops to encourage people to come in and invest, especially in small and medium companies,” Nasscom President Som Mittal said. STPI, which offers tax exemption to export oriented units on profits under Section 10A and Section 10B of the Income Tax Act, was extended by one year till March 2011 in the Budget last year. “These things start impacting in the long run. When they said they won’t extend STPI, it was when DTC was supposed to come in 2011. For many larger companies, STPI benefits have got over and they have moved into SEZs. Not all companies can get into SEZs,” Mittal said. The government had introduced the SEZ policy, under which it offers 100 per cent tax exemption for the first five years and 50 per cent tax exemption for subsequent five years. If the scheme is not extended, tax rates for Indian IT companies could go up to 25-30 per cent from about 20 per cent currently. Other demands include reduction of MAT (minimum alternate tax), introducing new incentive schemes based on employment and location, simplification of service tax refunds and clearer interpretation of tax laws. Agrees AMD MD and Corporate VP (Sales and Marketing) Ravi Swaminathan. “Instead of tweaking one per cent here and there every year, the government needs to adopt a long-term view and adopt a zero-tax regime. This will bring in PC penetration and promote manufacturing,” he said. MAIT, a body representing hardware manufacturers said, the tax structure needs to focus on reducing the dependence on imports to feed domestic manufacturing. “Less than 20 per cent components required for local equipment manufacturing are available from domestic sources. The tax regime needs to ensure that companies look at local equipment rather than importing them at cheaper rates from the neighbouring countries,” Manufacturers' Association for Information Technology (MAIT) Executive Director Ashwini Aggarwal said. He added that the 4 per cent SAD (special additional duty) should be abolished on all IT products and components. — PTI
	RCom, Bharti seek early exit from rural telephony scheme New Delhi, February 6 Two leading telecom operators, Reliance Communications and Bharti Airtel, have approached the government seeking to prematurely exit from the rural telephony scheme under the Universal Service Obligation (USO) subsidy without fulfilling the commitment they had made by winning bids in 2007 to provide telecom services in villages. The government has an over Rs 14,000-crore corpus under the USO Fund. All service providers contribute to this fund and it is used to provide subsidy to operators and infrastructure providers to set up operations and offer telecom services in rural areas. The Telecom Ministry is contemplating a ban on non-performing service providers on participating in the next round of bidding, to be launched soon. The administrator handling the fund is also planning to change the criteria in a way that operators and infrastructure providers were not allowed to exit without fulfilling their commitments and are offered subsidy accordingly. The government had invited bids in 2007 to create telecom infrastructure and provide services in villages and had offered subsidy as well, but the operators opted to go there without seeking subsidy or even offered negative subsidy (instead they offered to pay to the government) either to block other service providers from going there or because they over-estimated the potential in rural villages. When contacted, officials in the USO Fund administration under the Telecom Ministry confirmed that Reliance Communications has less than 500 base stations active out of about 8,000 committed by them. Similarly, Bharti has also approached the USOF to exit from the scheme, officials said. “However, the requests of Reliance Communications and Reliance Telecom (both belong to Anil Ambani-led group) and Bharti have been turned down... There is no provision for service providers to unilaterally exit from the agreement on their own,” officials added. — PTI
	India presses for free South Asian trade in ‘letter & spirit’ Thimphu, February 6 Advocating deepening of intra-SAARC (South Asian Association for Regional Cooperation) trade ties, India today pressed for implementation of South Asia Free Trade Agreement (SAFTA) in its letter and spirit, in an apparent reference to Pakistan which has refused to implement the commerce opening pact in the context of India. “SAFTA can be an important instrument to deepen intra-regional trade if it is complied with by all member states and implemented in letter and spirit," Foreign Secretary Nirupama Rao told a meeting of SAARC Foreign Secretaries. She did not name any country, but was clearly referring to Pakistan which has refused to implement SAFTA in the context of India and insists on doing trade with it only on the basis of 'positive list'. Pakistan, while signing the SAFTA that came into force on July 1,2006, had agreed to implement it without reservation, but backed out later. India has been complaining, even to the SAARC Secretariat, that the issue of restricted import of goods from India by Pakistan under the SAFTA was against the letter and spirit of SAFTA. Currently, direct annual trade between Pakistan and India is around $2 billion and has a potential to grow to $10 billion. The indirect trade between the two countries is manifold. Rao also pressed for early ratification of the SAARC Agreement on Trade in Services signed at the 16th SAARC Summit in Bhutan last April, saying it will help realise the full potential of trade in services in the region. “India has already submitted its sector-specific request list of services to various members and we hope that the 'request-offer process' can soon gather pace at the meeting of the Expert Group scheduled for the end of March 2011,” Rao said. — PTI
	Tata Motors unveils new version of Manza sedan New Delhi, February 6 Tata Motors on Sunday announced the launch of a new version of sedan Manza priced between Rs 5.14-5.91 lakh (ex-showroom Delhi).“With a new look of premium dual tone interiors and an exterior make-over, the new Tata Manza delivers a driving experience, which is a class apart in the sedan market,” the company said. The new range would be available across all Tata Motors dealerships from February 7. The top-end variant of the new Tata Manza series, Tata Manza Elan, is equipped with a host of features like dual tone alloy wheels, burgundy and beige interiors, chrome garnished bottom weather strip, fog lamps and a new colour, it said. The new Tata Manza series has been priced at Rs 5.14 lakh for the Safire petrol range and Rs 5.91 lakh for the Quadrajet diesel range (ex-showroom, Delhi). — PTI
	Egypt crisis to impact policy: RBI Goa, February 6 Events in Egypt will have an impact on Indian monetary policy, the Reserve Bank of India (RBI) deputy governor told reporters on Sunday.“After making the policy announcement on January 25, a whole set of events unfolded in the West Asia, which are starting to have an impact on oil prices, obviously, which we did not anticipate at the time we made the announcement,” Subir Gokarn, deputy governor at the central bank, said. The crisis in Egypt has raised concerns of a disruption to supply of West Asian oil shipped through Egypt and of unrest spreading across West Asia and North Africa, which combined produce more than a third of the world’s oil. “So, a completely new environment has emerged in a very short time after the announcement. It is going to have an impact on our thinking, our action going forward,” Gokarn added. India’s central bank raised interest rates on January 25 by a quarter of a percentage point to clamp down on resurgent inflation and warned of persistently higher food prices unless steps are taken to boost supplies. — Reuters
	Unitech promoters repay Rs 250 cr loan New Delhi, February 6 The promoters of Unitech have repaid the entire Rs 250 crore they borrowed from a clutch of investors by pledging their shares a year ago.The investors from whom the funds were raised had issued a notice on January 28 giving virtually no time to Unitech's promoters to return the money, failing which they threatened to sell the pledged shares in the market on January 31. This forced Unitech's promoters to move the Delhi High Court on January 31 to obtain a stay on sale of the shares by the creditors. Morgan Stanley was the banker of the debenture issue, sources said. The total outstanding amount in lieu of the pledged shares on January 28 was Rs 178 crore, which the promoters were required to pay by May this year, sources said, adding that the promoters have repaid the entire amount in three tranches. “The repayment was done in three stages - 30 per cent of Rs 178 crore on January 31, 20 per cent on February 4 and the balance was paid yesterday,” a source said. The repayment was done 17 days ahead of the deadline given by the Delhi High Court. — PTI
	Google receives 75k job applications in a week London, February 6 Internet search giant Google received a staggering 75,000 job applications within just a week of kicking off its massive recruitment drive, says a media report.According to the Daily Mail, "Google received a staggering 75,000 job applications in just one week as it launch(ed) a huge recruitment spree." The US-based company holds the record for the highest number of job applications received when it advertised openings in May, 2007, the report noted. However, the latest barrage of applications tops that figure by 15 per cent, with the company planning to add more than 6,000 new jobs. Competition for roles at the company is likely to be fierce, with 12 hopeful candidates vying for a single position an average. Google had just 3,000 staff when it got listed on the New York Stock Exchange in 2004. — PTI
	Tax Advice DTC limits scope of deductions under 80C by SC Vasudeva Q: What is the maximum amount of investment u/s 80C in Direct Tax Code. — RP Enterprises, Batala A: The Direct Tax Code provides separate limits for deduction in respect of contribution to an approved fund, payment of life insurance premium, payment in respect of health insurance premium and tuition fee. The deduction in respect of contribution to an approved fund is limited to Rs 1 lakh. The deduction for life insurance premium, health insurance premium and tuition fee is allowable to the extent of Rs 50,000. It may be added that the deduction allowable for life insurance premium is restricted to 5 per cent of the capital sum assured. It may be noted that apart from the above, other deductions covered in Section 80C of Income Tax Act, 1961 (The Act), are not considered as allowable deductions in the Direct Taxes Code. Tax on professionals Q. With reference to your tax advice appearing in these columns (December 27) regarding keeping of books of accounts by businesses having income up to Rs 60 lakh, I have the following queries: (a) Whether the term "Business" includes "Profession" other than notified provisions. (b) If the answer to query (a) is yes, my second query is as follows. In a hypothetical situation involving a professional with gross receipts less than Rs 60 lakh there is no need for him to keep books of accounts. He, therefore, declares his income as 8 per cent of his gross receipts. Can the ITO call for his bank statement ass book for scrutiny and assess the professional's income at a higher level than declared by him because the total debits in the latter's bank account representing his expenses justify a higher margin of income than 8 per cent? — Balaji A. The term "Business" does not include Profession as evident from the provisions of Section 28 which brings to charge "Profits and Gains of Business or Profession". The professionals are, therefore, not covered within the provisions of presumptive taxation and you would not be able to take the benefit of such provisions. Tax on TA/DA Q. I am an employee of a college/university. (a) I have been deputed for purchase of some educational material (books etc) from other city on the spot from market. I have been permitted by the department to travel by department vehicle / taxi / own car. I preferred to travel by own car along with purchase committee. In lieu of expenditure occurred on journey, I was reimbursed Rs 1,200 as TA and Rs 120 as DA (totalling Rs 1,320). (b) I have been asked by the department to visit a conference at Mumbai. I travelled by 3rd AC and attended the conference. In lieu of expenditure occurred on journey, I was reimbursed Rs 1,500 as TA and Rs 480 as DA (totalling Rs 1,980). Kindly clarify: should I add the reimbursed amounts of Rs 1,320 + 1,980 to the total annual income for calculating the income tax for the said financial year. — Pramila Gupta A. Normally, reimbursement of expenditure is not treated as an income which is liable to be taxed as per the Act. However, in case the amount paid is in excess of the actual amount spent, the excess amount would be treated as an income liable to be taxed. Accordingly, in case the amounts received by you on your official trips by car/train represent the actual amount spent, such amount would not form part of your total taxable income.