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AV Birla Group bags Canadian firm for Rs 562 cr
Malaysian auto ancillary arrives at Baddi
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Now ADAG questions Mukesh’s airport project
Pressure on RIL to move ethanol plant outside Maharashtra
AVIATION NOTES
INVESTOR GUIDANCE
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AV Birla Group bags Canadian firm for Rs 562 cr
Mumbai, June 24 Initially, the Group's BPO company Trans Works Information Services Ltd would acquire 46.4 per cent promoters' stake and make an open offer to public shareholder with an intention to acquire 100 per cent stake. "This should close by August this year," Group Chairman Kumaramanglam Birla said. Minacs, with $265 million in revenue and 6,000 employees, has key abilities in automobile, telecom and financial services and centres across Canada, UK and the US. TransWorks Information Services Ltd is offering $5 in cash for all outstanding common shares of Minacs. Toronto-based private investment firm Reichmann Hauer Capital Partners tied-up with Aditya Birla Group in its evaluation of the transaction and intends to invest in the combined entity. Mr Birla said about 10 per cent stake could be offered to Reichmann Hauer. "As per our policy, we want to be a dominant player in every sector that we are present. So by this acquisition TransWorks will be among the top three in terms of size and revenue in India," he said. The combined business will have an approximate revenue of $300 million, he said, adding that the acquisition will mark the entry of TransWorks into the automobile sector. TransWorks is awaiting regulatory clearances for making the open offer, which is expected to happen by July 10. Minacs decided to exit the business after its proprietor expired, Mr Birla said. He said Minacs has presence in two-three domains — automobiles, telecom and financial services, which would give the Group's BPO company TransWorks size and dominance. — PTI
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Malaysian auto ancillary arrives at Baddi
Chandigarh, June 24 Disclosing this here today, Mr K.S Juneja, Managing Director, Crosslink Wheels Electronics, said the Indian company will have 51 per cent holding in the company, while out of the 49 per cent with the foreign partners, 30 per cent will be held by Malaysian company and 19 per cent by its Singapore-based company. Initially, he said, the company would import and assemble semi- knocked down (SKD) kits, but by the end of the year, most components would be manufactured locally. Mr Albert Tan, Managing Director, Wheels Electronics, said this would be company's second plant outside Malaysia, the first being in China. Wheels Electronics has an annual turnover of over $25 million and its products were sold in 22 countries globally. The manufactured devices include remote car security and convenience systems like power windows, power curtains and reverse sensors for car manufacturers like Toyota, Honda, Lexus, Mazda, Peugeot. Mr Tan added that at Baddi plant they would produce hi-tech gadgets like geo-positioning tracking system (GPS) and radio frequency identification device (RFID) which will make car security impregnable. Equipment manufactured here will be sold both in domestic and foreign markets.
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Now ADAG questions Mukesh’s airport project
New Delhi, June 24 "As per agreement executed on June 18, 2005, airports are reserved for ADA group," Reliance Energy sources said while questioning the 'non-compete agreement' signed between RIL and four companies carved out from it before transferring the new entities to Mr Anil Ambani. Targeting the proposed airport project by RIL group company in the upcoming Rs 25,000-crore Special Economic Zone in Haryana, Reliance Energy said their argument for building a cargo airport was 'untenable' as no such exception was provided in the family agreement. "The demerger scheme approved by the Bombay High Court on December 19, 2005, provided that suitable non-compete agreements would be entered into to give effect to the family agreement, which stipulated that airports will be with the Anil Ambani group only," REL sources said. RIL officials could not be contacted for comments on the latest development. RIL had, however, said yesterday that "Reliance has fulfilled all its commitments and obligations. It will follow the same principles as well." This was in response to REL's letter to RIL questioning the power projects in the SEZ.
— PTI |
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Pressure on RIL to move ethanol plant outside Maharashtra
Mumbai, June 24 Yesterday, Mr Sharad Pawar told officials of major sugar co-operatives at Pandharpur in western Maharashtra that he would persuade Mr Mukesh Ambani to shift the plants elsewhere in the country. According to plan, RIL was to buy sugarcane directly from farmers at the rate of Rs 1,700 per tonne as against Rs 1,200 per tonne paid by the co-operatives. This proposal would have severely dented the power base of top NCP politicians, including Mr Pawar himself, who control the sugar co-operatives in western Maharashtra. Reliance proposes to manufacture ethanol, a petroleum additive from sugarcane. The Indian government permits between 5 and 10 per cent of ethanol to be added to petrol. RIL had earlier also promised to make spot payments on purchase of sugarcane as against co-operatives who delay payments for months. Mr Pawar had only last month advised co-operatives to get into the ethanol business themselves. However, following pressure from the sugarcane lobby, Mr Pawar reversed his stand at Pandharpur. Though Maharashtra’s 202 sugar cooperatives produce 99 per cent of the sugar in the state, poor management and political interference has brought many of them to their knees. Only 165 of these sugar co-operatives are functional though they run up huge losses. Ten have lost their licences, while 10 others are being liquidated and 17 others are being restructured. |
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Jet-Sahara deal demise not
unexpected
by K.R. Wadhwaney The aviation analysts maintain that the Jet-Sahara ‘deal demise’ is not unexpected. They argue that the Rs 2,300-crore mammoth deal was doomed to death the day it was inked five months ago in January 2006. The reason: Both super-star players are ‘master craftsmen’ in figure-manipulation with no intense enthusiasm or genuine desire to upstage topsy-turvy airline industry. The background of both super stars does not portray ‘clean image’ since their entry in airline trade. One is accused of foreign exchange violations; the other has a questionable finger in every pie with none knowing which is the fountain that provides him ‘money-muscle’. Both have enjoyed political patronage. A powerful politician in saddle has been working overtime to render one airline baron steal ‘complete monopoly’ in the Indian skies. This has pricked the ego of other main players who have plotted the gameplan collapsing. The situation is hazy. It is embroiled with no holds barred litigation. Who will gain financial muscle is difficult to predict at this juncture. Whoever is winner or vanquished, the Indian aviation is a loser. As the much-talked deal has collapsed, many analysts are of the firm view that the merger of Indian and Air-India will also fall through because motivators are the same personalities involved in the Jet-Sahara deal. Two days after the collapse of the deal, the Home Ministry has given ‘security clearance’ to Jet’s boss Naresh Goyal. When asked, the ministry official is reported to have gone on record as saying: “The government is not concerned by deadlines fixed by private parties”. Whatever the Home Ministry official may say, the fact of the matter is that strange are the doings of different ministries. One day the official is accused of having ‘links with people having criminal background’. The next day, he is given clearance saying that ‘earlier allegations were wrong’. The indepth study shows that ministries are not sorting out problems but are adding more twists and turns to controversies existing in the Indian skies. Amidst vex situation, officials of Air Sahara claim that they have secured operations. This is far from convincing. Jet Airways officials play truant. The airport and other users make a counter-question saying that it is not possible for Sahara to resume operations without any tacit permission from the Airports Authority of India (AAI). The whole situation is messy and it can promote accidents and incidents. With the split between airline barons, the advantage of the ‘open skies’ will receive a setback. Indeed, several new players are waiting in queue, but the scenario will be ‘huddled in darkness’. Whatever optimistic persons may say, the over-all aviation take-off has taken a beating. The truth of the matter in the fall-out of the Jet-Sahara deal is that Indian civil aviation will never wear a ‘healthy look’ as long as politicians and shoddy industrialists are ruling the roost.
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No indexation available for short-term capital gain
by A.N. Shanbhag
Q: I am looking to sell a house, which I bought around three years back. I have few queries regarding capital gain tax. — Bhupesh A: The point by point reply to your queries is as follows: Tax on perks
Q: The company provides me free accommodation. Will the notional cost of the perk be included for income tax computation? — Gajanan A: Perk value for employees of Central and state governments shall be the licence fee as per the rules framed for its officers. For others, where the accommodation is owned by the employer it shall be 20 per cent of the salary for cities having population over 4 lakh as per 2001 census and 15 per cent of the salary for other cities. However, where the accommodation is taken on lease or rent by the employer, the value of the perk will be actual cost to the employer or 20 per cent of the salary, whichever is lower. If the accommodation is furnished, 10 per cent of the original cost of the furniture and if the furniture is hired, actual hire charges shall be added every year to the perk of unfurnished accommodation. Furniture includes televisions, radios, refrigerators, other household appliances and air conditioning plant or equipment. Gift and tax
Q: I was under the impression that any amount received from any person who is not a relative is taxable over and above Rs 25,000. However, my CA told me that this amount had been increased to Rs 50,000. I referred the Income Tax Act and the section still mentions the limit as Rs 25,000. Can you throw some light on the issue? — Vidyadhar Sawant A: Your CA is correct. The erstwhile Rs 25,000 limit has been increased to Rs 50,000 by the Taxation Laws (Amendment) Act, 2005 dated 17.5.2006. Now the revised Section 56 reads as under: Where any sum of money exceeding Rs 50,000 is received without consideration by an individual or an HUF from any person on or after 1st day of September 2004, the whole of such sum will be charged to income tax of the recipient under the head income from other sources. “Provided that this clause shall not apply to any sum of money received Explanation:
For the purposes of this clause, “relative” means- PPF account
Q: I have the following queries: — Narshinh Nayak A: 1. Notification GSR 908(E) dated 6.12.00 requires the ceiling on the aggregate contributions to be Rs 70,000 to the accounts of self and all minor children of whom he is a guardian (and also HUF and AOP of which he is a member). If one exceeds this and the irregularity comes to the notice of the account office, it will return the excess contribution without any interest to the account holder. 2. RBI Notification GSR291 (E) dated 13.5.05 has discontinued opening of the accounts on behalf of HUF, AOP and BOI with immediate effect. Such accounts opened by mistake shall be treated as void ab initio. As and when the error comes to light, the account shall be closed and the amount refunded to the depositor without any interest. 3. When an HUF is reduced to a single male unmarried coparcener, major or minor (even if it is an unborn child and found to be a male after birth), the income of such a person will be assessed as income of the individual. When he gets married, the income arising out of the ancestral property can be assessed as HUF. The only situation where an HUF should have at least two male members is where an individual had thrown his self-acquired property into the hotchpotch but his family consisted of only himself, his wife and an unmarried daughter. Income
there from must be assessed as that of the individual and not that of his HUF until he begets a son (Kalyanji Vithaldas v CIT 5ITR90). Yes, there was a time when HUF was useful as a tax-saving device. Now that it is possible to save tax on investible funds irrespective of its size, thanks to equity-based MF schemes, the utility of HUF has got considerably diluted. The authors may be contacted at
wonderlandconsultants@yahoo.com |
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