|Sunday, January 23, 2000,
Group-7 bows to US demands
SBI holds NRIs meet
Tau flat TV launched
Allahabad Bank to mop up 82.3
Escorts net profit jumps
to Rs 57 crore
Corporate management practices
TOKYO, Jan 22 (AFP) The Group of Seven (G7) powers today bowed to increasing US alarm and issued a joint warning that the world needs more balanced growth, especially from sluggish Japan.We see improved prospects for non-inflationary growth in the major industrial economies and the world economy as a whole, said the statement issued by G7 Finance Ministers and Central Bank Governors.
But the challenge remains to secure a more balanced pattern of growth among our economies that is important to sustaining the expansion, said the declaration, made after a one-day meeting here.
US Treasury Secretary Lawrence Summers rammed home the point, demanding Japan open its markets to ensure faster growth critical to the world.
What is most important for Japan and what is most important for the global economy is that sustained domestic-demand led growth be achieved in Japan, Summers told reporters.
Japan won a G7 endorsement for its fears that a strong yen will eat away at the value of its exports, one of the few strong pillars of its fragile recovery.
But Finance Minister Kiichi Miyazawa warned that Japans future hinged on private demand.
In the past two years alone, Japan has forked out about 58 trillion yen ($ 552 billion) in extra state spending to stimulate demand. But private investment is still weak.
Summers said fiscal policy was only part of the answer, however, pointing to Japans failure to open its telecommunications market in line with Washington demands.
The G7 statement stressed the need to take advantage of the investment opportunities created by new technologies, echoing US frustration at Japans failure to push along the Internet bandwagon with lower telephone costs.
There are limits to the efficacy of fiscal policy and that is part of the reason why the communique and the Japanese authorities have placed increasing emphasis on the importance of structural policy, said Summers.
The Group issued an alert against corruption, warning that it could undermine the benefits of the global financial system.
CHANDIGARH, Jan 22 SBIs main branch here today organised a seminar in which 27 NRIs from the UK, the USA, Germany, Japan, Australia and the Middle East participated.
Mr V.K. Gupta, Deputy General Manager, apprised the participants of various schemes of the bank and tax benefits to the NRIs on various accounts. He said an NRI cell had been created so that they were trated like VIPs.
CHANDIGARH, Jan 22 The Matsushita groups two subsidiaries National Panasonic India Limited and Matsushita Television & Audio India Limited plan to launch digital products in India. The first in the series, Tau flat TV, was launched here today.
The manufacturing and marketing activities have been brought under one common Managing Director, Mr V. Ozasa.
The proposed product range includes the Tau series of colour television microwave ovens and futuristic AV digital products, all targeted at the middle and upper segments.
The Matsushita group has also inducted Mr Gurdeep Singh as Director Sales, Marketing and Service at National Panasonic India Limited. It is for the first time that an Indian is heading all the three functions, said Mr Ozasa.
The group has also
launched a campaign Digital World 2000, with
products like plasma TV pure flat TV (Tau), projection
TV, music systems with DVD player and the worlds
smallest digital movie camera all available in
Bank to mop up 82.3 crore
CHANDIGARH, Jan 22 Allahabad Bank, will enter the capital market with its initial public offering (IPO) of equity shares during March-end this year.
The bank has got the approval of RBI and the Ministry of Finance to issue 8.23 crore equity shares of Rs 10 each, aggregating to Rs 82.30 crore, a bank release said.
With the issue the Government holding in the bank will stand reduced to 75 per cent. With an annualised earning per share of Rs 6.50 and book value exceeding Rs 27 as per the financial results for the first half of the current fiscal, the investment in the share was expected to give attractive returns to the investor on listing, he said.
The bank will seek permission from SEBI to appoint four lead managers to the issue. The draft document was likely to be filed with SEBI during the first week of February.
The bank registered a net profit of Rs 80.25 crore in the first half of the current fiscal compared to Rs 135 crore recorded during the full financial year (1998-99).
The total deposits of
the bank increased to Rs 16761.91 crore on
Septemeber99 compared to Rs 15510.36 crore as on
31.03.1999. The gross advances increased to Rs 7704
crores compared to Rs 7321 crore for the same period.
NEW DELHI, Jan 22 (UNI) Escorts Limited today reported a net profit of Rs 57 crore for the quarter ended December 31, 1999 as against a net loss of Rs 22.1 crore for the same period last year.
The net profit includes the income from extra-ordinary items of Rs 69.5 crore for the quarter under consideration.
The companys net profit for the nine month period at Rs 111.4 crore has clearly surpassed the entire year net profit of Rs 84.1 crore.
The gross sales went up to Rs 301.5 crore compared to Rs 213 crore for the quarter under consideration. The PBT shot up to Rs 73 crore compared to Rs 22.1 crore.
management practices identified
THE personnel department in corporate is usually in a quandary and the personnel gurus invariable grapple with life in the real world while managing the HR practices calling themselves with diverse names personnel managers, HR managers, staff managers, employees relation managers etc. and try to identify their targeted role in respect of corporate staff, employees, workers, people and even partners.
It is said that if an HR manager has to add valve he needs to build and maintain his own credibility by being accurate, cosistent, meeting commitment, balancing work and family life and being at ease with his colleagues. True organisation is one which does not have an HR man ultimately.
Merely trying to encourage employees to pander to the whims of customer is not enough. The need of the hour is to break from the clutches of traditional corporate chains and help people to discover how they could become good human beings in totality. It is a well recognised fact that only a good human being can be a good worker. In order to ameliorate employees commitment towards organisation for enhanced productivity and profit following management practices have been identified:
Manage with the assumption of being always under fire since the customer is always right and is looking constantly for better consumerism and manager should periodically be on the road to understand him. Promoting customer satisfaction includes internal customers also.
Constatnly move for more creative, aggressive and talented marketing by keeping the product range unique and not just any product. Raising standards means regularly creating new products and new markets.
Accentuate the necessityof ones presence being felt with high volumes at discounted prices, good service in spite of high advertising costs.
Bank on quality, since customer is willing to pay through the nose for perceived quality standards and better appearances. Todays professionalism in consumerism demands the knowledge of even how people look and act.
One should not only achieve good cost controls but set newer, higher objectives and plateaus.
The response to targeted customer aspirations should be quick for which one has to be in touch and be able to build a relationship with and understand customer needs, their joys and despairs by physically working in the market place alongwith sales people.
Always believe that you are at the beginning and trying to make that first year of profitability.
Be meticulous even in hiring procedures including interviewing for a specific job profile. Recruiting the right people is job well begun.
Create a level of management security and stability by treating the managers as proprietors and giving them stock options. This would enhance retention rate, a problem peculiar to knowledge organisations.
Campaign family friendly policies by reducing status differentials with feet on the ground and being humble. Effort should be to make the personal life of workers more fulfilling in all its aspects.
Pay performance linked high wages integrated with team work and job design.
Invest heavily on training for competency building. Career-long learning continuously and implementing the same is a must for enhancing productivity, managing costs, customer service and staff satisfaction level.
Share information and make extensive use of self-managed teams and decentralisation. Collaboration can make knowledge sharing easier.
More strategic approach to people management will deliver bottom line results.
In the end it can be
said that managing people well increase profitability and
beating them up hurts the bottom line. As such
competitive pressures will compel low-performing
organsiations to make hard decisions.
by Praful R. Desai
Violation of fundamental right
Q : Whether the enactment of Rent Control Act by the state of A.P. lacks legislative competence or violates fundamental rights due to absence of analogous provision in similar Acts of other states?
Ans : The Andhra Pradesh HC was considering this point in the case of Champalal Bhandari v State of AP (1999 (2) R.C.J. 408) as under:
What it is to be seen is whether the enactment of the Rent Control Act by the State lacks legislative competence or violates fundamental rights. The petitioner could not demonstrate before the HC as to how the A.P. Legislature lacks legislative competence. In view of the HC there is a legislative competence for the A.P. Legislature.
Even assuming that the Rent Control Act is not traceable to Entry 18 of list II of Sch. 7 and even if it is assumed to be a concurrent list, as there is assent of the President and as there is no Act contra to the A.P. Rent Control Act enacted by the Parliament, the Rent Control Act is valid and inter-vires the Constitution.
The HC added that it is a settled law that legislation will always be general and will not be specific, as the legislature cannot comprehend the situations arising for adjudication and it is always left to the Court for interpreting the statutory provisions or the Rules framed thereunder. The legislature enacts a provision and the same is interpreted by the court having regard to the facts of the case and that is the essence of the Administration of Justice and as such, the contention that unfettered discreption is conferred on the courts is untenable.
The other contention regarding infraction of Art. 19 (1) (g) of Indian Constitution has got absolutely no relevance to challenge the instant provision of the Rent Control Act and the said contention is only stated to be rejected, as the legal proceedings available to the landlord for evicting the tenant can never be traced to the fundamental right to trade U/Article 19 (1) (g) of the Constitution of India.
In the result the
revision was allowed and the HC set aside the order of
the Appellate Authority and restored the order of the
Rent Controller. The tenant is given two months
time to vacate and hand over the vacant possession of the
petition premises to the petitioner.
by R.N. Lakhotia
Q: My total salary during the financial year 1999-2000 will be Rs 1,60,000. Please calculate the income-tax on this amount. Can I save tax more than Rs 14,000 (without availing house loan). If yes then how.
Umesh Mittal, Barnala
Ans: On your salary income of Rs 1,60,000 during the financial year 1999-2000 you will be eligible for standard deduction of Rs 20,000 thereby the net taxable income will be Rs 1,40,000. Income Tax on this amount together with surcharge for the assessment year 2000-2001 comes to Rs 18,700. If you make investment upto Rs 70,000 as per section 88 tax rebate comes to Rs 14,000. You can also make investment in terms of Section 80CC whereby you get a deduction from your income to the tune of Rs 10,000 by investing in LIC Pension Plan thereby saving further Income Tax to the tune of Rs 3,000.
Q: Our Trust seeks clarification on the following matter:-
Donations to Bhai Ghanaiya Charitable Trust are qualified for exemption u/s 80-G of Income Tax Act 1961 currently upto 31.3.2004 (Assessment Year 2004-2005). The Trust used to give an undertaking to its donors that 50 per cent of the amount donated to the Trust may be deducted out of the total income of the year for the purpose of assessment of the tax. Now at occasions it is noticed from different newspapers, that the rebate u/s 80-G is 100 per cent.
(i) Whether the rebate is 50 per cent or 100 per cent.
(ii) If 100 per cent from which date.
I shall be obliged if you could kindly sent the clarifications at an early date because donations for Kargil martyrs are pouring in.
Ujjal Singh, Hoshiarpur
Ans: On the facts stated by you, the donation made to your trust would result in tax deduction to your donor @ 50 per cent only. The deduction of 100 per cent on the donation paid is only for certain specific trusts which have received permission from the Government or which are suitably notified for this purpose.
Q: My son opened a PPF A/c in SBI at Delhi. He was depositing amount in PPF A/c and claiming rebate in Income Tax. Now he has got a job in USA and has gone to USA on H1B visa. He wants to continue depositing in PPF A/c. Please advise about the procedure he can adopt for depositing the amount in PPF A/c. Can he send the cheque in favour of his mother for further deposit in PPF A/c or he should send cheque direct to the bank authorities for deposit in PPF A/c. Please also advise if such deposit will attract any income tax liability.
Ans. Your son can make deposit in the PPF A/c by issuing the cheque from his NRE A/c in India. If you want to keep the PPF A/c of the son alive you may deposit Rs 100 per annum from your funds in the said PPF A/c of your son. This will be on account of gift to your son. Contribution in PPF will not attract any Income Tax liability. In case you want to deposit higher amount than Rs 100 per annum, even then the deposit will not attract any Income Tax liability because it will as a sort of gift by you to your son which is exempted from gift tax.
Q: I am a Central Government pensioner of 75 years of age. My only source of income is by way of pension, which is expected to amount to Rs 1,43,460 during the current financial year. After deducting the standard deduction upto Rs 25,000 and a contribution of Rs 1,101 to the Army Central Welfare Fund, my likely taxable income would be Rs 1,17,360, during this financial year.
Do I get a relief of Rs 10,000 u/s 88B, of IT Act as well as NIL tax liability on the first 50,000 rupees of the taxable income? If so, does it mean that a senior citizen is not liable to pay any IT if his annual income does not exceed Rs 1,75,000?
B.P. Joshi, Shimla
For a senior citizen after taking tax rebate u/s 88B,
there is no tax liability on a total income of Rs
1,00,450. This amount is inclusive of initial income tax
exemption available to every individual of Rs 50,000. If
the net taxable income for a senior citizen is Rs
1,75,000, then for the Financial Year 1999-2000 relevant
to the Assessment Year 2000-2001 the gross income tax
liability including surcharge would be Rs 29,150. From
this tax rebate u/s 88B will be deducted to the tune of
Rs 10,000 and balance Rs 19,150 will be payable by the
by A.K. Sachdeva
Q: We are engaged in the business of purchase and sale of machinery parts and accessories in the District of Sonepat being a dealer registered under the Haryana General Sales Tax Act, 1973 and the Central Sales Tax Act (CST), 1956. We buy inputs from within the State on payment of first stage sales tax as well as from the places situated outside Haryana. The tax paid at first stage on the raw-material and consumables as per the provisions of the Haryana General Sales Tax Act, 1973 is always adjusted while computing sales tax on the sales of finished products. However, the benefit of set-off is never allowed by the sales tax authorities against payment of CST on inputs which are purchased in the course of inter-State trade of commerce.
Clarify if we are not entitled to the adjustment of tax in respect of CST paid to the sellers while making purchases of inputs from the places situated outside the State of Haryana?
Mohan Industries Pvt Ltd,
Ans. Before any benefit of draw-back or set-off is claimed, it is essential that the relevant provisions of the Act provide for the same in express terms. It is true that whatever payment of tax at first point is made under the Haryana General Sales Tax Act, 1973 on inputs and consumables, the same becomes adjustable in terms of the provisions contained in section 15-A read with rule 24-A and rule 24-B of the Haryana General Sales Tax Rules, 1975 from the tax payable on the sales of manufactured goods either under the State Act or the Central Act. However, the provisions of the CST Act, 1956 or the corresponding rules made thereunder do not provide for similar adjustment of tax or set-off as far as payment of CST on raw-materials and consumables is concerned. The Sales Tax Authorities therefore are not authorised to allow such benefit of adjustment of tax in the absence of any specific provision in the CST Act, 1956. Nor any proposal has so far been made for such an adjustment of tax by the Central Government.
Q: We are given to understand that the Haryana Government has abolished all kinds of statutory forms such as ST-15, ST-14, STD-4 and ST-14A etc and a new system of filing authenticated lists of purchases and sales involving dealings with registered dealers has been introduced.
Surinder Narula, Hisar
Highly placed sources disclose that the State Government
has decided to effect drastic amendments in the existing
provisions of the Haryana General Sales Tax Rules, 1975
with a view to doing away with the requirement of
furnishing statutory forms in support of various
deductions which are usually claimed by the registered
dealers. The Council of Ministers has approved of this
change in law and the notification in this context will
become operative from Ist day of January, 2000 as the
sources confirmed. The registered dealers will not
henceforth be required to furnish statutory forms such as
ST-14, ST-15, STD-4, ST-14A etc in support of the
deductions claimed in the periodical returns and
production of authenticated copies of the lists that are
filed alongwith the returns will be treated as a
compliance for the purpose of statutory deductions.
retailers play with customers
IF you have the habit of keeping receipts or bills issued by retailers, I would suggest that you just look at them carefully to see the terms and conditions printed on them. You would be shocked at the extent to which some retailers go to escape responsibility for the quality of goods sold. Some textile retailers, for example, say that they do not guarantee the colour fastners of the fabrics sold. Now I am sure if a trader informs the consumer of this condition of purchase at the very beginning of the transaction, no consumer will want to buy from him. So the trader chooses to put such conditions on the back of the receipt, which is not likely to be seen by the consumer. It is only when a dispute arises on the quality of the goods sold that the retailer points to the condition and tries to escape liability.
This week I would like to write about one such case that came up before the consumer court, Mr V. Susairaj bought a silk saree for Rs 1,395. Within three months of purchase, it was noticed that the colour of the saree border was not stable and that it ran. He took it back to the shop and asked for a refund, which was refused. The consumer then filed a complaint before the District Consumer Disputes Redressal Forum, seeking a refund, a compensation of Rs 1000 and costs.
One of the first objections that the trader put forward was that the saree was to have been dry-cleaned, but the consumer had hand-washed it at home. The Forum, however, found that the saree had never been washed and even a drop of water on the saree border resulted in the bleeding of the colour. It then directed the shopkeeper to pay back the cost of the saree along with 12 per cent interest. In addition, it awarded Rs 1000 as compensation and Rs 200 as costs. Aggrieved, the retailer filed an appeal before the Pondicherry State Consumer Disputes Redressal Commission. And this is the most interesting part of the case, so for as consumers are concerned.
One of the main arguments put forward by the retailer before the State Commission was that the bill that he issued on purchase of the saree clearly said; No return, no exchange, no guarantee for colours. Having printed that condition on the receipt, he was not liable for any colour defect or bleeding of the colour, the shopkeeper argued. The State Commission, however, was not impressed with this argument.
The Commission pointed out that if the vendor wanted to escape liability on the basis of certain terms and conditions governing the sale, then he should have brought them to the notice of the customer before the contract of sale was concluded. He should have warned the consumer beforehand that he cannot give any guarantee for colour fastness of the material being purchased by the consumer. Then it was up to the consumer to decide whether or not to purchase from him. The mention on the bill that the trader cannot give any guarantee for colour fastness did not absolve him of his liability because the bill was given only at the time of delivery, after the consumer had purchased the saree. The retailer therefore could not take shelter under the terms and conditions printed on the bill, the State Commission held. It also pointed out that in the Tamil translation of the terms and conditions printed on the bill, there was no mention that the trader cannot give guarantee for colour fastness. In the end the Commission upheld the order of the District Forum and in addition awarded costs of Rs 500 to the consumer (Velan silks vs V. Susairaj).
But for the consumer courts set up under the Consumer Protection Act, retailers would probably get away with such unjust terms and condition printed on the back of the receipt or at the bottom of the receipt. Similarly, the MRTPC has come to the aid of consumers against unfair terms and conditions imposed by dry cleaners, and held that a dry cleaner cannot disown all responsibility on the basis of disclaimer clauses printed on the receipt and even suggested modified terms and conditions that are fair to both the parties.
Consumer groups and associations of trade and industry should now come together and draw up similar terms and conditions governing retail trade. Or the Law Commission should be entrusted with the task. The Law Commission had in fact undertaken such an exercise many years ago.
Meanwhile, whenever you come across retailers stipulating unfair terms and and conditions of purchase, just refuse to buy from such outlets. Also protest against such conditions in writing.
TATA Infotech has reported a slump in its net profit to Rs 1.87 crore for the quarter ending December 31 (as against Rs 11.54 crore during the same period last year) despite a 30.9 per cent rise in net sales and other income to Rs 116.77 crore (Rs 89.19 crore).
Computer diskette maker Moser Baer India Ltd (MBIL) reported a 78 per cent rise in net profit to Rs 10.68 crore in the third quarter (October-December) of current fiscal compared to Rs 6 crore in the corresponding period last year. Sales of the company were up by 37 per cent to Rs 40.45 crore during the period from Rs 29.5 crore.
Essar Shipping reported a drop of 65 per cent in its net profit to Rs 3.56 crore during the third quarter ending December 31, 1999 as against Rs 10.23 crore in the corresponding period last year.
Corporation Bank has posted a 12.6 per cent growth in its net profit at Rs 177.42 crore during the nine months ending December 31, 1999 as against Rs 157.59 crore in the corresponding period of the previous year.
Total income during this period stood at Rs 1368.12 crore against Rs 1128.29 crore in the first nine months of last fiscal, showing a rise of 21.3 per cent.
Marico Industries Limited on Saturday announced a modest 4.7 per cent growth in profits before tax at Rs 10.6 crore for the third quarter ending December 31, 1999 over the corresponding period last year.
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