|B U S I N E S S||
Sunday, September 6, 1998
TV-18, Discovery get FDI
tourism facilities sought
Zip industry hit by excise
lays cement plants foundation
upset over drug export ban
pipe makers hail rate contract
to LIC policy holders
TV-18, Discovery get FDI approval
NEW DELHI, Sept 5 (UNI) The Foreign Investment Promotion Board (FIPB) today approved 35 foreign direct investment proposals amounting to Rs 2,400 crore which includes applications by media giants TV-18 and Discovery as well as petroleum major Tractebel Energi South Asia Private Limited.
However, the board deferred for four weeks decision on the proposal by Rothmans of Pall Mall to set up a cigarette manufacturing unit in the country seeking further clarifications on the project, FIPB Chairman and Industry Secretary T.R. Prasad told newspersons here today.
Commerce Secretary P.P. Prabhu would be meeting the company representatives shortly to seek details on the guaranteed quantity of tobacco which Rothmans proposes to buy in India and its export commitment with regard to raw tobacco, processed tobacco and cigarettes, Mr Prasad said.
Meanwhile, FIPB sources stated that the largest proposal approved today was from Tractebel Energi South Asia Private Limited of Australia for bringing in Rs 1,850 crore worth of FDI to develop LNG storage infrastructure and terminal facilities.
The foreign partners BHP Petroleum of Australia and Tractebel of Belgium would together hold 74 per cent stake in the company being set up in Kakinada, Andhra Pradesh in a joint venture with an Indian company.
The TV-18 proposal seeking to up the foreign partners holding from 20 per cent to 41.3 per cent was also given the nod. The two US companies AIA Capital Investments and Communications Equity Associates have been allowed to bring in Rs 1.30 crore for hiking its stake in the media venture with a paid up capital of Rs 3 crore, besides the two US companies, a Non-Resident Indian holds 19.5 per cent stake in the company.
Meanwhile, Discovery Communications has been allowed additional activity in India.The applications of two other media giants South Asia Software Exports Limited (SASEL) and Millitoon Animation Private Limited (MAPL) were given the nod at the meeting today.
While SASEL intends to bring in Rs 54 crore as FDI, MAPL would be investing Rs 4 lakh in the country for its operations.The media proposals were cleared pursuant to Information and Broadcasting Minister Sushma Swaraj having okayed a policy regarding foreign direct investment in all media except print.
The policy allows foreign equity to the extent of 74 per cent in TV software companies. However, it forbids them from entering into broadcasting activities where the foreign equity is likely to be capped at 20 per cent when the Broadcast Bill is enacted into a law by the end of the Winter session.
In the drug sector, two major proposals were cleared, which included an application by Fresenius Mafatlal Medicals seeking to bring in additional equity of over Rs 43 crore into the existing venture.
Prestrop of Netherlands has been allowed to invest Rs 40 crore for manufacturing and dealing in chemicals.Four software proposals were also given the go-ahead by the board, which included an application by international rectifier to invest Rs 6.5 crore for setting up a base to globally source its software requirements from India.
The company is operating in power and electronic sectors, the sources said.In the automotive sector, Concentric Pumps Limited was allowed to invest Rs 4.5 crore for manufacturing components and pumps which are presently being imported.
The company would produce
specialised components and pumps in the country.In the
food processing sector, Shiv Kumar Jithiya was allowed to
manufacture and distribute flavours and intermediate by
infusing Rs 8 crore FDI into the country.
Zip industry hit by excise
NEW DELHI, Sept 5 The decision of the government to allow international giant YKK Corporation to manufacture zip fasteners in the country and the decision to impose 8 per cent excise duty on small scale manufacturers of zip fasteners and components could kill the local industry, domestic manufacturers say.
The Zipper Association of India, representing body of over 50 small and medium scale manufacturers and thousands of units in the tiny sector which employ over 45,000 workmen, is apprehensive about their survival in the face of competition from the giant multinational, which is more than 1000 times the size of the largest local producer.
Their woes have been compounded by the Finance Ministrys decision to impose 8 per cent excise duty on the local industry, the President of the Association, Mr Anil Tandon, said here today.
The levy which has been imposed at a time when the zip industry is facing recession due to poor garment export performance will cripple the local units, he said.According to Mr Tandon, thousands of units in the tiny sectors fear harassment by the Excise Department.
He said this was avoidable as the government would realise little revenue as the major inputs in the industry bear excise duty at higher rates on which Modvat is available.
Better tourism facilities sought
CHANDIGARH, Sept 5 Over 17 million tourists visit India annually and the Tourism industry has an annual growth rate of 4 to 5 per cent for the past 10 years which is considered to be largest as compared to the other industries.
Mr Sushil Gupta, president of the Federation of Hotel and Restaurant Association, said this yesterday while delivering a lecture on Tourism 2000: an integrate quest.
The tourism industry contributes about 12 per cent of the GDP to the nation and employs about 9.1 million people, he said.Mr Gupta criticised the mushrooming of catering institutes which do not provide right kind of training to students.
He stressed the need for improvement in tourism infrastructure.He said it would be for the first time that various bodies would present a joint memorandum on the ensuing Budget to the government. Among other demands it will include setting up budget hotels and provision of more flexibility in such laws.
Officials of Chandigarh and Punjab Tourism, representatives of India Tourism Development Corporation, Indian Airlines, Tourism Finance Corporation, Institute of Hotel Management and Food Craft Institute were also present.Mr D.S. Grover, DRM, Northern Railway (Ambala Division), said new trains on the Kalka-Shimla and Kalka-Bombay routes would be introduced.
Badal lays cement plants
BATHINDA, Sept 5 Mr Parkash Singh Badal, Chief Minister, Punjab, today laid the foundation stone of Rs 300-crore Ambuja cement grinding unit here.
Mr Suresh Neotia, Chairman, Ambuja Cement, said the plant which was being set up in 95 acre of land would start production in about two years.Apart from boosting other business activities in the town, the plant would provide direct and indirect employment to about 1000 persons.
would use fly ash of local thermal plant free of cost for
initial 25 years.The company had offered the cement to
the Punjab Government at cheaper rates for bricklining
the canal system of the state, he added.
Industry upset over drug export ban
CHANDIGARH, Sept 5 (PTI) Pharmaceutical industry has decried the efforts of Drug Controller General of India (DCGI) to scuttle export of newer drugs, depriving the country of precious foreign exchange due to Viagra scare that has left the bureaucrats feeble enough to take a pragmatic decision.
Mr N.R. Munjal, a local drug manufacturer said that the DCGI in a blanket order had stopped issuing no objection certificate (NOC) for all drugs meant for exports, including Sildenafil Citrate, the basic drug used in making Viagra.The export of Sildenafil Citrate has been banned on the premise that certain merchant exporters may smuggle in Viagra whose misuse in India may pose a problem, Mr Munjal said.
The centre has also banned the export of a newer life saving antibiotic clarithromycin putting in jeopardy its annual export worth $ 27lakh, Mr Munjal said, adding that this antibiotic has Rs 26 crore market in India alone.
Indian companies manufacturing clarithromycin like Ind-Swift Laboratories, Ranbaxy, Alembic, Fine Chemicals and Microlytes feel upset over the indecision by the government over the issue, Mr Munjal said.It is now more than 50 days that DCGI has not issued any NOC for export of any drug on the plea that if NOC is given for any drug, then NOC will have to be given for Viagras basic drug also as the file dealing with NOCs for all the drugs is the same, Mr Munjal said.
Industry and trade organisations like chemical basic chemicals, pharmaceuticals and cosmetics export promotion council, Haryana Pharmaceutical Manufacturers Association(HPMA), Chandigarh Small Scale Drugs Manufacturers Association (CSSDMA) and Federation of Indian Export Organisations (FIEO) have taken up the matter with Ministry of Health, Ministry of Commerce and Ministry of Chemicals and Fertilizers, but with no solution in sight, Mr Munjal said.
The Indian companies which had confirm export orders for Clarithromycin have already starting getting cancellation of orders because they could not meet the export commitments and have suffered huge losses in terms of raw-material-holding-costs as they were not given NOCs.
They have to bear
penalties for not honouring export commitment to the
foreign buyers.Interestingly, Ministry of Chemicals and
Fertilizers has asked these companies to approach State
Drug Controllers for getting NOCs as DCGI has refused to
issue them, he said , adding that drugs and
pharmaceuticals being on concurrent list. State Drug
Controllers are under the functional control of DCGI and
cannot bypass the Central authorities.
PVC pipe makers hail rate contract
CHANDIGARH, Sept 5 (PTI) The All-India PVC Pipe Manufacturers Association today hailed the finalisation of much-awaited rate contract of PVC pipes by the Director General of Supplies and Disposals (DGS & D) New Delhi after a lapse of thirteen years.
The comprehensive rate contract, which carries a price variation clause, totally eliminates the need of floating individual tenders by various state governments and organisations as they can buy PVC products at DGS & D rate contract with any approval, the association said in a press release.
The associations President, Mr S.S. Gupta, said during on-going severe recession and paucity of funds, the Central and state governments could save crores of rupees if they switched over to PVC pipes in place of conventional iron pipes which were health hazards due to rusting, incrustation and corrosion and had been banned by the developed countries.
"A.C. pressure pipes have been branded to cause disease like cancer, Mr Gupta said, adding that statistics showed that government suffered a huge financial loss of Rs 400 crore every year due to corrosion alone, while PVC pipes were safe hygienically, with a longer life span of over 50 years, light in weight and easy in handling, laying and jointing.
To ensure quality of PVC pipes of global standards, the association has launched, vigorous awareness campaign and will soon set up an independent PVC pipes testing laboratory in collaboration with Reliance Industries in order to weed out defaulting manufacturers, Mr Gupta said.
The association has also approached the Ministry of Chemicals and Fertilizers for recommending PVC pipes to all the indenting authorities, particularly for the schemes or development works of potable water supply, he said.
For effecting reforms in
the PVC industry, the association has planned to hold a
national conference on PVC pipes in collaboration with
Reliance Industries Ltd the next month in New Delhi, Mr
Assurance to LIC policy holders
CHANDIGARH, Sept 5 The LIC today organised a customer education meet here. Mr R.C Agarwal, Senior Divisional Manager, LIC, Chandigarh Division, presided.Mr Jaipal Singh, Chairman, Consumer Forum, asked the LIC to amend its rules which were obsolete now.
Policy holders and Consumer Forum members apprised the corporation of their grievances. They wanted efficiency, transparency and accountability in LIC.Mr Agarwal assured the policy holders of a good performance.
Q: When the claim of bonafide need was already raised on earlier occasion and it was decided between the parties, is it necessary for the landlord to establish changed circumstances since then?
Ans: Kerala H.C. in the case of Jayaram V Achuthan Thampi (1998 (1) R.C.J. 130) was dealing with the question.The H.C. at the outset observed that when the claim of bonafide need was already raised on the earlier occasion and the same was decided between the same parties, the burden is entirely on the landlord to establish that the subsequent petition is maintainable due to changed circumstances.
In other words, the burden is on the landlord to establish that the rent control petition is not liable to be rejected summarily since the issue which was raised and finally decided between the parties is not substantially the same.
Petitioner has not established or pleaded that the present petition is maintainable due to changed circumstances when the same was sought to be resisted by the tenant.It is an admitted fact that when the earlier rent control petition was filed, petitioner was retired employee of KSRTC. Petitioner was also working as Assistant Accountant in a private enterprise by name Chellam Enterprises.
When the petitioner was examined as a witness in this proceedings he admitted in cross-examination that the circumstances which were in existence when the earlier petition was filed continued.His own admission, pointed out the HC, would indicate that there is no change in the circumstances.
It is under the above-mentioned circumstances both the courts below came to the conclusion that the present petition is hit by S. 15 of the Rent Control Act.
The HC agreed with this
finding and held that both the courts below have
correctly come to the conclusion that the present
petition is hit by S.15 of the Act.Accordingly, the HC
held that the present revision petition lacks merit and
consequently dismissed the same.
CASHING in on the Indians fascination for light skin, a plethora of fairness creams have invaded the market. But few know that even pop star Michael Jackson wants to regain his old colour. Gone are the days when one had a limited choice of desi products, as all leading cosmetic companies are flaunting their products with a majority of them promising a new skin tone in a few weeks.
But doctors and consumer bodies debunk their claim saying people are being taken for a ride. Experts accuse the manufacturers catering to the fairness cream users, who constitute 25 per cent of the cosmetic market, of keeping the consumer in the dark about all the ingredients of the product and its safety.
Most whitening creams use hydroquinen or depigmenters which help in making the colour brighter but in the process destroy the natural pigment of the skin and causing skin cancer and chemically induced luecodarma, says Dr A.H. Rizvi, senior consultant dermatologist at the Moolchand Hospital in Delhi. (PTI)
Land of beer
Germany, where beer has been made since before Christ was born, still has way more breweries than the rest of Europe combined 1,269 in 1997.But the title of the worlds biggest beer drinkers already has been lost to the Czechs as sales dry up. The federal statistics office this month reported another decline, 0.7 per cent, for the first half of 1998.In the old days, especially in Bavaria, after church guys would go and drink a few beers.
Now theyre more likely to spend time with the family and go hiking or mountain-biking.Not to say Germans have totally abandoned their liquid stuff of life. (AP)
These days, its a rare national catastrophe that makes no one a millionaire.The history of other American scandals suggests that the real money will lie in facts and artifacts. For Lewinsky, her true earning power is surely through memorabilia.
Given that unremarkable dresses once worn by Jackie Kennedy Onassis reached millions of dollars at auction, Monica is sitting on perhaps literally, in the case of one notorious prop of the scandal items of extraordinary value.Imagine the bidding war that would ensure over that stained dress and, still more, over that unusually humidified cigar. Who knows what other memorabilia there may be?
The scandal, after all, escalated because of the intern tendency to keep mementos. (The Guardian)
Pots & pans
A contingent of 93 exhibitors from India participated at the Tendence 98 of Frankfurt, touted as one of the worlds largest consumer goods shows, displaying products ranging from handicrafts, crockery, aluminium and stainless steel pots to jewellery.
The problem with Indians is that they see Europe as a dumping ground. They lack innovation and designs, Gunther Koenig, a German businessman, told IANS. I have been seeing the same pots and pans here from Moradabad for over a decade.
Also, just look at
the Indians unprofessional appearance and way of
talking to business people coming to their stands,
he added, pointing to a pan-chewing Moradabad businessman
loudly praising his merchandise in English heavily
peppered with Urdu words. (IANS)
father is working with Food Corporation of India as
Assistant Manager. He is physically handicapped and
getting deduction under Section 80U. He is also receiving
disability allowance from corporation whether it is
taxable or not?
Sunil Kapoor, Chandigarh
Ans: The disability allowance received by your father from Food Corporation will be taxable as income. He can avail the benefit of Section 89 (1) in respect of the arrear salary received by him.
there any provision of rebate for a Punjab state
government employees on P.P.F. contribution?
Lakhbir Singh, Kapurthala
Ans: Like any other employee, the employee of Punjab state government can take the benefit of tax rebate on contribution to the Public Provident Fund. Similarly, in respect of payment of instalment under Self-Financing Scheme of the Housing Board, tax rebate can be availed as per Section 88.
Q: I have
General Power of Attorney (GPA) of the house where I am
residing. I am paying Rs 1378 p.m. (Rs 16536 p.a.) to
Chandigarh Housing Board as the monthly instalment
against the above said house. I am a government employee.
Sat Paul, Chandigarh
Ans: As per Section 88 tax rebate is available in respect of payment for purchase or construction of residential house and this payment also includes the payment of instalment under Self-Financing or other Scheme of development authority. Hence, the payment made by you to Chandigarh Housing Board will be eligible for tax rebate as per Section 88 of the Income-tax Act, 1961. The maximum amount on which you can get tax rebate is Rs 10,000. The rate of tax rebate is 20 per cent.
Q: Kindly guide me that if three brothers are residing in their parental house (single storeyed) of 225 yrds. (125 covered & 100 open) without any formal division, how the floor area occupied by each of them should be calculated according to section 139 (i), when the parents have expired.
S.D. Gupta, Ludhiana
Ans: On the facts stated by you, the 1/3rd undemarcated portion of the total area occupied by each of the co-owners is less than the criteria fixed by the Government, namely 800 sq. ft. for Ludhiana.
Hence, on the facts stated by you, if you are not fulfilling other economic criteria then merely for occupying a small house as per the facts mentioned by you there is no liability to file Income-tax return.
Q: My date of birth is 18-10-33 and I am a pensioner. Please guide me if I will be entitled for benefits to senior citizens in the assessment year 1998-99 (income year 97-98) Income-tax return.
S. Lal Bhudhiraja, Chandigarh.
the facts stated by you for the Assessment Year 1998-99
you will not be eligible for tax rebate for a senior
citizen because you have not completed 65 years of age as
on 31st March 1998. You will be eligible for the benefit
of senior citizens tax rebate only on and from the
Assessment Year 1999-2000.
Q: We are registered as a dealer under the provisions of the Punjab General Sales Tax Act, 1948 as also under the Central Sales Tax Act, 1956 and carry on business of manufacture and sale of washing soap and detergents in the District of Amritsar (Punjab).
Our unit was issued with exemption certificate for a period of 120 months in terms of State Government notification No 11/15/43/96-5/IB/4176 of June 1, 1996 from the date of commencement of commercial production which was December 16, 1997. As the exemption certificate granting the benefit of exemption of sales tax was received at a later point of time, we have had deposited sales tax along with the sales tax returns for the periods from December 16, 1997 to December 31, 1997 and January 1, 1998 to March 31, 1998.
Now we want to apply for the refund of sales tax which was deposited along with the sales tax returns furnished to the assessing authority. Kindly advise if we are entitled to the same under the provisions of law?
Mohan Soaps, Amritsar
Ans: Having regard to the fact that exemption certificate has been granted by the appropriate authority granting the benefit of tax exemption in terms of Section 30-A of the Punjab General Sales Tax Act, 1948 read with rule 2(xi) of the Punjab General Sales Tax (Deferment and Exemption) Rules, 1991 from the date of unit going into commercial production, it is clear the sales of finished products do not attract any tax liability under the statutory provisions.
So long as the exemption certificate issued by the appropriate authority remains operative, the sales tax authority cannot bring the turnover relating to the sales of finished goods into the net of taxation. Therefore, the amount of sales tax deposited along with the sales tax returns during the pendency of the application for the grant of exemption certificate becomes liable to be refunded to the party paying the same.
The assessing authority is bound to give full effect to the exemption certificate as far as benefit of tax exemption from the date of commencement of commercial production is concerned.
Even if the exemption certificate was issued later, it will wholly govern the exemption for the full period as specified in it. The unit therefore is clearly entitled to the refund of the amount of tax paid during the intervening period.
Q: We were registered as a dealer under the provisions of the Haryana General Sales Tax Act, 1973 and the Central Sales Tax Act, 1956 for the purpose of carrying on business of manufacture and sale of rice.
However owing to recurring losses rice sheller had to be closed. Now we have leased out the rice sheller as such to another registered dealer of Haryana for a period of five year for which a valid lease deed has been executed determining, inter alia, lease amount at Rs 2,00,00.00 per annum.
The assessing authority during the course of assessment proceedings has pointed out that the lease money being received by us is liable to sales tax. Kindly advise if the assessing authority is entitled to levy sales tax on the lease money treating the transaction to be a sale of goods?
Ans: Receipt of lease money as such does not any tax liability under the existing provisions of the Haryana General Sales Tax Act, 1973. It is only the transfer of right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration that is treated to be a sale of goods for the purpose of levy of sales tax.
Rice-sheller does not
constitute a moveable property and thus it does not fall
within the purview of the term goods as
defined in Clause (f) of Section 2 of the Haryana General
Sales Tax Act, 1973. Since the rice sheller as such was
rented out to another registered dealer, it cannot be
said having regard to the statutory provisions that
transfer of right to use the goods has taken
place. Under these circumstances the view of the
assessing authority that lease money attracts tax
liability under the provisions of the Haryana General
Sales Tax Act, 1973 does not have the backing of the
UTI Bank to mop up Rs 73.5 crore
MUMBAI, Sept 5 (PTI) UTI Bank is to raise Rs 73.5 crore through a public offer of 3.5 crore equity shares consisting of an issue of 1.5 crore equity shares and an offer for sale of two crore equity shares by Unit Trust of India at a premium of Rs 11 per share. UTI, the promoter, holds 87 per cent stake in the bank which would be reduced to 61.5 per cent by this public offer, UTI officiating Chairman and Executive Trustee P.J. Nayak told newsmen here today. The LIC and GIC hold the rest. The public issue opening on September 21 is being made to meet the conditions laid down by the RBI, UTI Bank Chairman and Managing Director Supriya Gupta said. He said the bank has 29 branches in 11 states and would add seven more branches this year and hopes to add 12 branches per annum for the next two years.
Tata-Yodogawa to pay 30 pc
JAMSHEDPUR, Sept 5 (PTI) Tata-Yodogawa Ltd, enthused by the profit of Rs 7.09 crore during 1997-98, the highest ever, has declared a 30 per cent dividend on the paid up capital of Rs 5.47 crore. The announcement was made by the companys board of directors which met here at the companys 30th annual general meeting here yesterday. Companys production at 9109 tonnes of steel rolls during the year was also the highest ever. The companys profit in the previous year stood at Rs 5.37 crore and production at 9059 tonnes.
IIMB signs MoU with WIPL
BANGALORE, Sept 5 (PTI)
Indian Institute of Management Bangalore (IIMB)
and Web Infotech (P) Ltd (WIPL), a subsidiary of Web
Interfaces Inc., USA, signed a memorandum of
understanding today for joint research activities in the
area of supply chain management and related issues
through annual funding for a mutually agreed period. WIPL
would provide access to their facilities for pursuing the
joint research activities and would fund Rs 4 lakh
annually for an initial period of three years, an IIMB
press release said. The MoU was signed by Dr M. Rammoham
Rao, Director, on behalf of IIMB and by S. Nagarjun,
Managing Director, on behalf of WIPL, Chennai.
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