Lucknow, May 19
As the strike by Air India pilots entered the 12th day, the government on Saturday promised to sort out problems of pilots within three months and appealed to them to join work.

Civil Aviation Minister Ajit Singh said whatever problems pilots have they should come forward and discuss. "But it’s not possible by creating loss or causing inconvenience to the passengers...The government will not adopt a victimization policy, whatever problems they have will be sorted out in three months," he told reporters after inaugurating a new terminal at Lucknow airport.

On the issue of reinstating sacked pilots, he said: "The pilots should come back to work...there’ll be no victimization by the government. Efforts are being made to resolve the situation. It's my appeal to the pilots that they should think about the passengers. If passengers get unhappy, it’ll create more problems in the days to come...If the airline doesn’t survive then there’s no meaning of other things like salaries, promotions or increments”.

As the Justice Dharmadhikari committee report is expected, there is no reason behind the strike and the pilots should come back to work, he said. "Dharmadhikari committee was constituted to look into the problems of the pilots...their problems would be considered," he said.

Singh noted the Delhi High Court had already declared the ongoing strike as illegal. "The court had said the strike is illegal and they (pilots) must abide by the law. The government has given a Rs 30,000 crore package for the revival of AI but money alone won’t make a difference. The airline has to be competitive and pay attention to the costs," he said.

The agitation has led the ailing national carrier to drastically curtail its international flight operations, particularly those to North America and Europe. The airline has already lost over Rs 190 crore due to the stir.

On the financial problems being faced by the aviation sector, Singh said the cost of ATF with taxes in India was 40% to 50%, whereas in foreign countries it was 30% to 35%. "If the cost is not reduced the problems will continue, but the manner is which passenger traffic and trade is increasing, future of the sector is bright," he added. — PTI

New York City, May 19
The historic initial public offering of Facebook Inc did not go as planned on Friday, as the social networking company's sky-high valuation combined with trading glitches left the stock languishing near its offering price at the market close.

Facebook shares began trading late Friday morning and opened 11% above the $38 offering price, but after peaking at about $45 slid rapidly at the end of the day to close at $38.23. The IPO was the third-largest in US history and valued eight-year-old Facebook at $104 billion.

The surprisingly weak debut of a stock that analysts had predicted would climb between 10% and 50% is not likely to dent the business prospects of Facebook, which boasts 900 million users and is upending business practices and social relationships around the world.

But the unexpected developments were a clear setback for Morgan Stanley, the lead underwriter on the deal, which sources said was forced to defend the $38 price level by buying shares on the open market. Many market participants said they expected the stock to remain under pressure next week.

The offering also proved an embarrassment for the NASDAQ: the opening was delayed as the exchange struggled with a huge volume of orders, and for much of the day there were long delays in order confirmation.

The US Securities and Exchange Commission said late Friday that it was reviewing the situation. — Reuters

Chandigarh, May 19
High NPAs (nonperforming assets) levels have forced banks in Punjab and Haryana to go slow in extending collateral-free education loans, as part of its priority sector advances. No wonder that there is a sharp decline in the education loans extended to students in the state.

According to Reserve Bank of India guidelines, banks are required to grant collateral free loans for an amount of up to Rs 400,000. However, with NPAs in these unsecured education loans rising to 4%, most banks have drastically reduced advances made under this category.

According to the latest data released by the state level bankers committee of Punjab ad Haryana, only 35% of education loans given by banks have been extended without seeking a collateral. Of the Rs 1,201.52 crore worth of education loans extended by banks in Punjab in 2011-12, unsecured loans were just Rs 419.39 crore. NPAs in these loans were Rs 18.11 crore, which is 4.31%. However, advances under education loans in Punjab rose by Rs 57.35 crore to Rs 1,201.52 crore in March 2012 from Rs 1,144.17 crore in March 2011.

In Haryana, of the total education loans of Rs 930.91 crore extended in FY2011-12, the collateral free loans were worth Rs 411.02 crore. The NPAs were Rs 17.41 crore, which comes to 4.2%. The total increase (year-on-year) in education loans between FY2010-11 and FY 2011-12 was Rs 24.33 crore (from Rs 906.58 crore in 2010-11 to RS 930.91 crore in 2011-12).

Sources in the banking sector told The Tribune many youngsters who had taken unsecured education loans were unable to return it. Lack of employment opportunities and a general slowdown in hiring were cited as main reasons by these loanees to repay their loans.

Also, most youngsters taking out loans in Punjab did so for seeking education abroad. The loan amount required by these students is over Rs 400,000 (the maximum limit for unsecured loans). This is another reason why the percentage of youngsters taking collateral-free loans is coming down. 

Q: Are there any restrictions in the Income Tax Act on possessing a residential house(s) in addition to the one that has been transferred for getting a concession on long-term capital gains tax and, if so, the restrctions come under which relevant section of the income tax regulations?
— Sanjeev Agrawal

A: If an asset sold is a residential house, then exemption from long-term capital gains tax is available upon reinvesting the capital gain amount within the prescribed time limit in another residential property.

This is according to Section 54 of the Income Tax Act, which imposes no condition on the taxpayer regarding possession of house properties other than the house sold. In other words, the taxpayer may own any number of additional immovable properties — it has no bearing on the available deduction under Section 54 of the Income Tax Act.

Q: If I sell a housing plot and decide to buy NHAI (National Highways Authority of India) or REC bonds, do I need to invest only the capital gains (after indexation) or does the net sale value have to be invested? Earlier, you have written that the net sale value must be invested (rather than the capital gains) in a residential property when land is sold. 
— Apparao Chettipalli

A: Please note that if the asset sold is a residential house, then only the capital gain amount needs to be invested in another residential house. If it is any asset other than a residential house, then the net sale proceeds have to be invested. In the former case Section 54 of the Income Tax Act is applicable whereas in the latter case it is Section 54F of the Act.