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RBI gives banking licence to IDFC, Bandhan Financial
Corporate India’s credit quality on course of recovery: Crisil
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No provision for CSR spend in backward areas in DTC
draft
SpiceJet surges 19% even as DGCA halts
Re 1 fare offer
Airtel’s mobile data user base to reach 129m in 3 years, says report
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RBI gives banking licence to IDFC, Bandhan Financial
New Delhi, April 2 With regard to the application of the Department of Posts, the RBI accepted the recommendation of the high-level screening committee to take further action in consultation with the government. The RBI originally received 27 applications in July 2013, after which Tata Sons and Videocon Group withdrew, leaving 25 contenders in the fray. Besides India Post, the other applicants included state-run IFCI and private sector Anil Ambani group and Aditya Birla group, Bajaj Finance, Muthoot Finance, Religare Enterprises and Shriram Capital. "It will pave way for more entities to come forward and spread financial inclusion. It augurs well for the economy and banking sector," Financial Services Secretary GS Sandhu said. At present, there are 27 public sector banks and 22 private sector banks in the country. The RBI has issued bank licences after a gap of a decade. It last awarded licences to Kotak Mahindra Bank and Yes Bank in 2003-04. While permitting the two applicants, the RBI said it "believes that some of those entities who did not qualify in this round for a full-fledged banking licence could well apply in future rounds or could apply for differentiated licences under the proposed framework." The central bank said it intends to use the learning from this licensing exercise to "revise the guidelines appropriately" and move to give licences more regularly, that is, virtually "on tap." It will also frame categories of differentiated bank licences and allowing a wider pool of entrants into banking. The RBI said IDFC and Bandhan were recommended as suitable for grant of "in-principle" approval by the High-Level Advisory Committee (HLAC) headed by former Governor Bimal Jalan. The in-principle approval granted will be valid for 18 months, during which the applicants have to comply with the requirements under the guidelines and fulfil other conditions as may be stipulated by the RBI. Once the RBI is satisfied the applicants have complied with the requisite conditions, they would be considered for grant of a licence to start banking business under relevant sections of the Banking Regulation Act.
— PTI In-principle approval
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Corporate India’s credit quality on course of recovery: Crisil
New Delhi, April 2 The credit ratio, at 0.79 times in 2013-14, has remained weak for two years now as downgrades outnumbered upgrades on slowing demand, tight liquidity and high interest rates. However, moderation in downgrade intensity has helped the credit ratio recover marginally from the previous fiscal. These rating actions had a large base of over 13,000 ratings. Crisil downgraded ratings of 1,165 firms and upgraded those of 921 in the last fiscal. Around 90% of the downgrades was on account of slowing demand, tight liquidity, and stretched working capital cycles. Companies in investment-linked sectors such as power, construction, engineering and capital goods, and transport had more downgrades than firms in other sectors. More than a third of the upgrades was on account of company-specific factors such as sustained track record of timely debt servicing and stronger-than-expected capital structure. Another third of upgrades was driven by improved business conditions for firms in sectors - such as packaged foods, textiles and agricultural products - that have linkages with exports, agriculture, and non-discretionary consumer segments. ICRA in a study of the rating actions for over 7,000 companies revealed that while both the number and severity of rating downgrades moderated during the year, pressures on credit quality persisted against the backdrop of sluggish economic activity and the strains on cash flows and profitability brought about by weak demand. Positive signals
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No provision for CSR spend in backward areas in DTC
draft
New Delhi, April 2 According to an analysis of the DTC 2013 by tax consultancy KPMG, the Companies Act, 2013, provides that every company on fulfilment of certain conditions is required to incur expenditure on Corporate Social Responsibility (CSR). There is no specific provision to allow such expenditure either under the Act or DTC introduced in 2010. Further, the Parliamentary Standing Committee on Finance had recommended that the CSR expenditure cannot be allowed as a business deduction as it is an application of income. Allowing deduction for CSR expenditure would imply that the government would be contributing one-third of this expenditure as revenue foregone. In line with the same, no provision has been proposed in DTC 2013 to allow CSR expenditure. Girish Vanvari, co-head, Tax, KPMG India, says, “It would be interesting to see what finally happens to the DTC, especially in the backdrop of political uncertainty and what the thought process of the new government would be. Whether they would like to build upon this draft or look at something completely different.” The DTC also proposes a fourth income tax slab for the super rich. A slab of 35% tax rate for individuals having income exceeding Rs 10 crore has been proposed. The DTC has proposed to increase the threshold limit of levying wealth tax to Rs 50 crore from Rs 1 crore and Rs 30 lakh provided in DTC 2010 and the Wealth Tax Act, 1957 respectively. As per proposed provisions, the wealth tax is proposed to be levied at 0.25% on the net-wealth exceeding Rs 50 crore million as compared to 1% provided in DTC 2010 Wealth Tax Act. The current DTC proposes to cover all assets — physical or financial — as against only unproductive assets provided in DTC Bill, 2010. Further, the outstanding liability of wealth tax is specifically excluded from the scope of debts incurred in relation to specified assets. The latest version has accepted most of the recommendations of the Standing Committee, except progressive rate of taxation. It has also proposed an additional tax at the rate of 10% on recipient of dividend (liable to Dividend Distribution Tax) exceeding Rs 1 crore. |
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SpiceJet surges 19% even as DGCA halts
Re 1 fare offer
Shares of SpiceJet today rose by over 19 per cent even as aviation regulator asked the no-frills carrier to immediately stop its offer of one-rupee fares across its domestic network.
The stock surged 19.19 per cent to settle at Rs 17.27 on the BSE, after rallying to Rs 17.38, its upper circuit limit, during the day. SpiceJet's market value climbed Rs 149 crore to Rs 924 crore.
About 113 lakh shares of the company changed hands on the BSE. SpiceJet, which lowered fares by up to 75 per cent in the previous quarter, yesterday offered limited period bookings for as low as Re 1 across its domestic network. SpiceJet has been virtually leading a fare war in the aviation sector since January, forcing other airlines to make similar offers. Hours after the SpiceJet offer, the Directorate General of Civil Aviation (DGCA) shot off a directive to the airline, asking it to halt the offer "immediately". The regulator termed SpiceJet's one-rupee fares "predatory" and a "malpractice".
— PTI |
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Airtel’s mobile data user base to reach 129m in 3 years, says report
New Delhi, April 2 A report brought out by global brokerage firm CLSA said while the company had a data user base at 54 million at the end of December 2013, there would be a big jump on the same over the next three years. "Airtel is taking the lead in data ramp-up and, with the largest network and highest spectrum, we expect its mobile-data subscribers to jump to 129 million by FY17," the report said. |
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SC directs Samsung chief to appear in court SC withdraws Spigelman as arbitrator in RIL case BMW to recall over 2 lakh cars from China SBI extends special home loan scheme for women Suzlon Group acquires Big Sky Wind Park in US |
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