|Wednesday, April 5, 2000,
A black Tuesday for
Tax structure overhauled
New rail freight policy
held in USA for fraud
A black Tuesday for
NEW DELHI, April 4 It was a black Tuesday for the countrys stock bourses today with the markets reacting violently to reports that the Income Tax Department was targeting foreign institutional investors (FIIs), who had routed investments to India through Mauritius.
The woes of the stock markets were compounded with the Nasdaq recording its worst-ever fall of 349.96 points last night creating panic in the market.
The Finance Ministry in a bid to stem the rapid fall in the stock indices clarified that there was no move to revoke the avoidance of double taxation treaty with Mauritius.
Trading in the stock markets was marked by a major sell-off in information technology and traditional blue chips which led to the Benchmark 30-share BSE index crashing by a whopping 361 points.
Stock market operators said the market was jittery right from the morning following reports that the Income Tax authorities had issued notices to all FIIs, which have routed investments through Mauritius. Almost all IT scrips were stuck in the lower circuit filter.
The Delhi Stock Exchange also witnessed volatile trading with the Benchmark index plunging nearly 7.3 per cent following a steep fall in the stock prices. The DSE sensitive index nosedived by 73.74 points to close at 939.05.
The Finance Ministry in a clarification issued at a time when the bourses were having their mid-session said there is no move on the part of the Government to revoke or modify the agreement on avoidance of double taxation with Mauritius which will take away the benefits conferred on investors by this treaty.
The Ministry described as unfounded the market apprehension that henceforth all FII investments in India routed through Mauritius would become taxable.
The Ministry said the cases in which notices had been issued were going on for sometime and the views taken by the assessing offices pertain to specifics of each case and did not constitute any across the board denial of tax benefits or a policy shift.
The Central Board of Direct Taxes is examining this matter and inviting the representatives of FIIs operating in India to allay their doubts.
Investments through Mauritius comprise a majority of FII investments in India, which is estimated at around more than $11 million.
WASHINGTON, April 4 (Reuters, AFP) A federal judge has ruled that Microsoft violated US antitrust law by monopolising the market for PC operating system software and using its dominance against competitors.Microsoft Chairman Bill Gates said in Redmond that the company would appeal the verdict given by Judge Thomas Penfield Jackson.
The Judge, in a 43-page conclusion of law, said yesterday that Microsoft maintained its monopoly power by anti-competitive means and attempted to monopolise the web browser market.
He, therefore, found that the company had violated two sections of the Sherman Antitrust Act, as had been alleged by the US Justice Department and a coalition of 19 states.
But the Judge also held that the facts found do not support the conclusion that Microsofts marketing arrangements with other companies were violations of the law.
In his ruling, he said Microsoft failed to rebut the argument that Windows had monopolised the market for PC operating systems.
He said the government had provided ample evidence that was not refuted of Microsofts dominant, persistent market share protected by a substantial barrier to entry.
Reacting to the verdict, Mr Gates said As we look ahead to the appeals process, innovation will continue to be the number one priority at Microsoft.
The companys stock, down the entire day, improved slightly after verdict but was still off $ 15-3/8 at $ 90-7/8 in after-hours trading.
The Judges most serious conclusion was that Microsoft violated section 2 of the Sherman Antitrust Act by using its might against other companies, especially Netscape Communications, its rival in the 1990s for control of the Internet browser market.
Netscapes market share withered under Microsofts attack and it sold out to America Online during the early part of the trial.
Microsoft maintained its monopoly power by anti-competitive means and attempted to monopolise the web browser market, wrote the Judge.
While it is legal to gain a monopoly through skill or luck, it is illegal to use that power to perpetuate a monopoly by preventing competitors from springing up.
Representatives of the Justice Department and the 19 states that brought the case left open the possibility that they would seek the strongest remedy available for such a serious violation a break-up of the company. Alternatively they could seek changes in the companys business practices.
The Judge will determine the remedy during the next phase of the trial. The trial, which began in October 1998, is likely be completed in October of this year and appeals could last through 2002, if the case goes to the Supreme Court.
He ruled that Microsoft also violated two other lesser allegations and more than a dozen state charges, but the judge rejected a third federal allegation.
He found the company also conditioned the sale of its Windows operating system on the purchase of its Internet explorer web browser and attempted to monopolise the market for web browsers.
Microsoft became one of
the worlds wealthiest companies and made Chairman
Bill Gates the worlds richest man by manufacturing
Windows, the software that runs more than 80 per cent of
the worlds personal computers.
Tax structure overhauled
CHANDIGARH, April 4 Mr Sumeshwar, Chief Commissioner, Central Excise, Delhi Zone, said here today that the Union Budget proposals on indirect taxes had many path-breaking measures. The Finance Minister had overhauled the tax structure and liberalised procedures. Speaking at a meeting organised by the PHDCCI, he said many bold procedural changes have been announced reposing trust on industry. The valuation mechanism in Central excise is proposed to be changed to transaction value. The broad intention is to avoid litigation, eliminate uncertainty and disputes.
Mr S P Srivastava, Chief Commissioner of Customs, said the reforms process in indirect taxes has moved a long way since 1991 from a controlled mechanism which was called by the industry as Inspector Raj.
During discussions they agreed to consider permitting industry to pay Central excise duty at all nationalised banks which currently is restricted to Punjab National Bank. However they did not agree to the industrys request to allow full credit of capital goods straight away but limited it to 50 per cent in the first financial year.
Mr Ashok Khanna, IP President, PHDCCI, while welcoming the Chief Commissioner and other official, complimented the Government for the many positive measures on indirect taxes in the Budget.
NEW DELHI, April 4 (PTI) Railway Ministry today announced a new freight policy which would focus on strengthening of high density network for providing connectivity to ports, restructuring of the freight traffic and concentrating on picking up piece-meal goods traffic.
Stating this here, Railway Board Chairman V K Aggarwal said that an integrated transport policy was likely to be finalised very soon providing for inter-model complement, instead of competition, between rail and road traffic.
Earlier, Railway Minister Mamata Banerjee announced that the railways carried over 456 million tonnes of goods traffic during 1999-2000, showing highest-ever increase of 35 million tonnes in a year.
In 1998-1999, the goods traffic carried was 421 million tonnes, she said.
The minister praised the railwaymen for their record performance.
NEW YORK, April 4 The Indian chief salesman of a company here that defrauded investors to the tune of $ 3.2 million has been arrested and held at a bail bond of $ 200,000.Vikram Randhawa, an Indian citizen, was arrested this week and is being held on a bail bond of $ 200,000, Scott Brown, a spokesman at Attorney General Eliot Spitzers office, told ANS.
Randhawa (29) was among five brokers, including two Indian Americans, who have been indicted for allegedly defrauding some 90 victims in a $ 3.2 million stock scandal.
The indictment charged
that from October 1997 to June of last year, Allen
Andrescu, owner of Renaissance Capital Management Inc. of
Farmingdale, Long Island, and his brokers, Vikram
Randhawa and three cold callers Pammi Lamba,
Zuher Khalfan and Hamir Ramolia, promised investors a
two-and three-time return on their money within 90 days
for investing in a company, NNPD Textiles Inc., that was
about to go public. IANS
Punjab and Haryana
NEW DELHI, April 4 Punjab and Haryana need to re-look their economic policies if they want to cash in on of Indias integration into the global economy, a study said.
If the two states do not take measures to correct their dismal fiscal scenario, they would be in a precarious situation, the study warned.
In 1999-2000, Punjab had a revenue deficit of 3.7 per cent of GDP, while Haryana had 1.2 per cent.
If corrective measures are not taken, then by 2004-2005, Punjab would have a revenue deficit of 8 per cent of GDP, while Haryana would have 3.5 per cent of GDP, according to the study conducted by the National Council of Applied Economic Research.
The study said the implications of the fiscal stress would have an adverse impact on social and economic infrastructure. It would reduce credit worthiness and credit rating, make the states unfavourable for investment and hurt the future prosperity.
The states, with significant growth rates during the 1980s, could not take the advantage of the new economic policies of the 1990s.
The economies of Punjab and Haryana are agriculture dependent and the green revolution boosted their economic performance. The states have a large number of small scale units and the policy of reservation added impetus to their growth.
Another reason for the deficit is the subsidy in the power sector. Punjab has a revenue deficit of Rs 2,177 crore and power subsidy account for Rs 928 crore. Haryana has a revenue deficit of Rs 1,572 crore and power subsidy account for Rs 364 crore.
Despite these drawbacks, the report is optimistic as the two states could over turn the current fiscal stress and experience growth by taking several corrective measures.
The optimism rests on the market size of the states in terms of volume and purchasing power, good infrastructure in selected areas which needs to be augmented and properly maintained and abundant labour force.
Punjab and Haryana, the study said, should take measures for right-sizing the Government by rationalising its labour force, disinvestment of PSU, closing down of its loss-making units and stop fresh recruitment.
The two states should
promote the agriculture sector in a productive manner
like floriculture, horticulture, the SSI units should
modernise themselves, promote higher technical education
and promote low volume and high value industries.
NEW DELHI, April 4 (PTI) The government today opened up financial services sector further by allowing 100 per cent FDI in downstream Non-Banking Finance Companies (NBFCs), subject to a minimum capital of $ 50 million.The downstream companies would have to offload a minimum of 25 per cent stake in three years through a public offer, an official statement said here today.
Earlier, 100 per cent FDI was allowed only for holding companies with a minimum capitalisation of $ 50 million. NBFCs were allowed only 75 per cent foreign holding in downstream activities.
LUDHIANA, April 4 (FOC) Industrialists should collaborate with technical institutions to provide employment to the educated youth. These views were expressed by Jagdish Singh Garcha today at a function called Industry-institute meet 2000 at Government Polytechnic for Women.
Mr Anil Jain, Director,
Duke Fabrics and Mr B.K. Shukla, Principal Scientific
Officer, Department of Science and Technology, also
addressed among present on the occasion were Vinod
Thapar, Sanjiv Jain, Suraj Bhan Jain and J.S. Kolar.
Sri Adhikari ties up with US company
MUMBAI, April 4 (PTI) Sri Adhikari Brothers Television Network Ltd has entered into a joint venture with Silicon Valley-based IT solutions company, ETIAM Emedia Inc for developing animation software. The joint venture company ETIAM Emedia Ltd, in which SABTNL will hold 26 per cent equity, will set up a state-of-the-art studio in India to undertake development of animation graphics, animated cartoons and animated feature films, according to a SABTNL statement here today.
Sterlite net up 65 pc, to pay 110 pc
MUMBAI, April 4 (UNI) Sterlite Industries (India) has posted 65 per cent higher net profit of Rs 68.54 crore during the second quarter ended December 31, 2000. The turnover also improved by 43 per cent to Rs 761.84 crore during the quarter as compared to Rs 533.48 crore of the corresponding period of the previous year. Sterlite Industries (India) Ltd has declared an interim dividend of 110 per cent for the year ending June 2000, as against the total dividend of 100 per cent for the previous year.
Voltas Ltd on Tuesday declared an interim dividend of 12 per cent Rs 1.20 per share of face value of Rs 10 each for the financial year ended March 31, 2000. The record date is May 8, 2000.
ICICI Infotech, Sun Microsystems ink MoU
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