Tamil Nadu to usher in VAT from Jan 1
BoI may enter Tanzania
BoI may enter Tanzania
Chennai, July 22
Presenting the budget in the state assembly, state Finance Minister K. Anbazhagan said: “The government has decided to introduce VAT in the state with effect from January 1, 2007”.
This decision came in the wake of numerous pleas made by organisations and industries to reduce the rate of tax. According to Mr Anbazhagan, the request would be fulfilled to a great extent with the introduction of VAT. The budget has not introduced any new tax.
The budget also shows a fiscal deficit of Rs 231 crore, which is expected to be covered by thriftiness in expenditure and effective tax administration, he said.
Tamil Nadu will seek full compensation for the losses it incurs due to the implementation of VAT from next year, Finance Secretary to the Tamil Nadu government K. Gnanadesikan said today.
The implementation will cost the state Rs 2,400 crore per annum, he told a post-budget press meet.
Under the Centre’s three-year compensation scheme for states introducing VAT, Tamil Nadu is entitled to a compensation of 75 per cent of its losses, as it is introducing VAT during the second year, he observed. “However, the state will press for 100 per cent compensation,” he said.
Justifying the government’s decision, Mr Gnanadesikan said VAT would prevent flight of trade and industry from the state and attract new investors. — ANI, PTI
Mumbai, July 22
Talking at the sidelines of a function here this evening, the executive director of the bank, KR Kamath said: “We plan to open representative offices in Doha and Tanzania and upgrade our already existing representative offices in Senzen of China to a branch office.”
The bank has recently launched one mobile ATM at Shivganga in Tamil Nadu on an experimental basis and has plans to go for more such ATMs in future keeping in view their viability.
Elaborating it, Mr Kamath said: “We are interested in having ATMs in rural areas in big numbers. However, the viability of the ATMs is an important issue before us while doing so.”
As per the norms, there should be at least 200 hits at an ATM centre to make it commercially viable. — UNI
by K.R. Wadhwaney
In a futile bid to defend the indefensible ‘la affaire scotch smuggling’, the Air-India management’s ‘cover-up exercise’ has complicated the matter further.
Retired commanders of the status of Director operations are of firm view that the A-I management should have punished the officials for bringing-disrepute to the national carrier instead of providing them a clean chit.
On July 10, when the smuggling from the VVIP flight broke, it was stated that 14 officials and crew members had 19 whisky bottles. Of these, five each were in possession of Capt Naresh Kumar Beri, resident director in Delhi and liaison officer on the VVIP flight, and air hostess Lima Thapa.
When vigilance interrogated Capt Beri, he went on record as saying that he had bought these bottles. He, however, did not substantiate his claim with ‘appropriate receipts or vouchers.
Visibly upset at the goings-on in A-I, Civil Aviation Secretary Ajay Prasad, in a scathing letter on June 26, concluded by saying: “.... It seems the pursers, etc, all have been completely cavalier and irresponsible in their behaviour”.
A day later on July 11, the A-I Chairman and Managing Director V. Thulasidas, in his press briefing in Mumbai, said: “Stolen bottles were six...... The bar cart was opened somewhere in Hannover with one of the keys. There are a select number of people who possess these keys. ... We kept a discreet vigil on the baggage of all 30 members of the cabin crew at the Berlin airport.” Mr Thulasidas went on to say: “Many of them were carrying excess liquor and all necessary evidence has been collected through the investigation report”.
The CMD’s ‘cover-up endeavour’ merely succeeds in ‘bringing the cat out of the bag’. If ‘many were carrying excess liquor, how can stolen bottles be merely six’?
In a bizzare development, all the scars on the crews and other ‘favourite officials’ are said to have been white-washed. Capt Bedi has gone on record as saying that ‘the liquor that he was carrying was for personal consumption and it was merely a quarter bottle of rum and a half bottle of wine whereas what was missing from the bar cart was six bottles of whisky’.
One ‘Service Engineer’, who does not seem to have ‘a godfather’ in the national carrier, is being made a scapegoat in this ‘smuggling scandal’. It is said: “The SE had uninterrupted and free access to the entire upper deck of the aircraft”.
The bar cart is a part of the equipment. The investigations reveal that keys of bar cart are given to several officials as different SEs are on duty. He indeed, may have opened the concerned bar cart with the key in his possession. But did he steal bottles of whisky?
Whatever may be pressures on the CMD, Mr Thulasidas should come clean so that Air India should regain its image and reputation of the years gone by.
Mumbai, July 22
The profits were mainly driven by a handsome increase in both net interest income and fee-based income at Rs 1,475 crore, up 52 per cent, and Rs 985 crore, up 50 per cent, respectively, ICICI Bank Joint Managing Director Kalpana Morparia said.
Net interest margin (NIM) stood at 2.5 per cent as against 2.6 per cent in the same period last fiscal.
Deposits of the bank increased by 61 per cent at Rs 1,83,006 crore. The bank's NPAs declined from 2 per cent to 0.8 per cent of customer assets as on June 30.
Finolex Industries Ltd has posted over three-fold increase in net profit at Rs 9.55 crore for the quarter ended June 30, 2006, as compared to Rs 2.69 crore for the same quarter in 2005-06 on the back of buoyant demand conditions. The total income (net of excise) increased 23.63 per cent to Rs 236.67 crore for the first quarter ended June 30 from Rs 191.43 crore in the corresponding quarter a year ago, the company said.
Finolex Industries Ltd has posted over three-fold increase in net profit at Rs 9.55 crore for the quarter ended June 30, 2006, as compared to Rs 2.69 crore for the same quarter in 2005-06 on the back of buoyant demand conditions.
The total income (net of excise) increased 23.63 per cent to Rs 236.67 crore for the first quarter ended June 30 from Rs 191.43 crore in the corresponding quarter a year ago, the company said.
Gillette net down
Gillette India Ltd has reported a 66.30 per cent decline in net profit at Rs 5.92 crore for the quarter ended June 30, as compared to Rs 17.57 crore for the corresponding quarter in 2005-06. Total income (net of excise) increased to Rs 147.56 crore for the second quarter in 2006-07, up 26.47 per cent from Rs 116.67 crore in Q2 FY 05-06, the company said.
Gillette India Ltd has reported a 66.30 per cent decline in net profit at Rs 5.92 crore for the quarter ended June 30, as compared to Rs 17.57 crore for the corresponding quarter in 2005-06.
Total income (net of excise) increased to Rs 147.56 crore for the second quarter in 2006-07, up 26.47 per cent from Rs 116.67 crore in Q2 FY 05-06, the company said.
Panacea Biotec has reported a 132 per cent jump in its net profit for the quarter ended June 30 at Rs 49.76 crore as against Rs 21.40 crore in the same period previous fiscal. The company’s turnover in the quarter under review grew by 46.6 per cent at Rs 233.39 crore as compared to Rs 159.20 crore in the year-ago period, the company said.
Panacea Biotec has reported a 132 per cent jump in its net profit for the quarter ended June 30 at Rs 49.76 crore as against Rs 21.40 crore in the same period previous fiscal.
The company’s turnover in the quarter under review grew by 46.6 per cent at Rs 233.39 crore as compared to Rs 159.20 crore in the year-ago period, the company said. — Agencies
by A.N. Shanbhag
Q: In one of your articles you addressed the situation of non-availability of Capital Gains Bonds of NHAI and REC. I am under stress in this context. I sold a small portion of my flat (75 sq. ft), for which the agreement was signed in January 2006. The six-month period expires in the first week of July 2006. I hope you will keep citizens like me informed on the latest status for these bonds and/or any relaxation in the six-month period if the bonds do not come out in time.
A: The good news is that the capital gains bonds from REC are now available in the market. However, since there is a cap of Rs 4,500 crore on the issue, investors need to act fast. As per the latest notification, investors who have earned capital gains between 29.09.05 and 31.12.05 have time limit up to 30th September, 2006 to invest and those who have earned capital gains between 01.01.06 and 30.06.06 have up to 31st December, 2006 to invest. In your case, since the agreement was signed in January 2006, you can invest anytime up to December 2006. However, for reasons outlined above, please do not wait till the last date to make your investment.
Q: I want to know about the application of TDS. I have a proprietorship firm having sale of more than Rs 40 lakh. Naturally, its account is audited. I get some work done from other party on job work basis (i.e. on contract basis).My question is that whether I should apply TDS from the payment to the contractor under Clause 194?
— Rajesh Arora
A: A plain reading of the section makes it apparent that you have to apply TDS.
Section 80 C
Q: Kindly confirm under which section of income tax, I shall avail deduction (100%) of tuition fee of Rs 46,000 per annum being paid by me on account of study of my daughter. She is studying B. Tech in SUSC of engineering and technology, at Tangori, Mohali.Please also confirm if a senior citizen can avail deduction up to Rs 1 lakh u/s 80CCE (investment in Provident Fund, NSC, pension plan, infrastructural bond, mutual fund and insurance etc.) over and above the limit of Rs 1 lakh and 1.85. lakh as the case may be.
— J.S. Bhogal
A: 1. U/s 80C tuition fees paid, whether at the time of admission or thereafter, to any university, college, school or other educational institution situated within India for the purpose of full-time education of any 2 children of the individual. However, the eligible amount shall not include any payment towards any development fees or donation or payment of similar nature. The concession is available to each of the parents, if eligible, even in respect of the same child, on their respective payments.
2. The aggregate joint ceiling on deductions u/s 80C, 80CCC and 80CCD is Rs 1 lakh. This is besides the tax threshold of Rs 1.85 lakh for senior citizens.
Form 15 G
Q: I have invested Rs 36,000 in Senior Citizen scheme for the year 2005-06.The concerned officer has not deducted TDS till date. Now can I submit Form-15G for this or not as he intends to deduct TDS for the period of 2005-06. Can I submit Form-15G for every quarterly interest when interest is paid by the post office or one Form-15G can be submitted at the end of year?
— Prem Paul Kalra
A: Form-15G is to be submitted before payment of the very first quarter. For the earlier two years, those who have paid tax on self-assessment basis can show a copy of their returns to the bank or post office where their account resides. Others may file Form-15G or 15H as the case may be.
Q: The US and India have double taxation treaty. Now in the case of capital gains, the US allows me credit for tax paid in India. Now, since India does not have long-term capital gains tax, if I sell some shares bought more than a year back, I will not be liable to tax in India but will be in the US. As the tax payable in India is exempted, will that be considered as if I have already paid tax in India?
A: Please do note that tax-credit under the DTAA is available only in respect of ‘doubly taxed income’. Since no tax is paid on account of exemption u/s 10(38), there can be no presumption of tax having been paid u/s 112.
The law is that the income on which tax has been paid abroad and which is again taxed in another country will be entitled to double-tax relief, or in other words when source of income is taxable in both the countries.
In, 88 ITR 169 (SC), it was held by the Supreme Court that the expression, ‘doubly taxed income’ should be understood as income actually charged to tax.
Q: Mr X and Mrs X own a residential house since last 20 years. Both have 50 pc share each..
Mrs X purchased a residential plot in 1990 at a cost of Rs 71,000 = (Cost Rs 65,000 + Registration fee Rs 6,000) and sold the plot in May 2005 in total consideration of Rs 7,00,000.
In March’ 2005, Mr X and Mrs. X purchased a residential house (having 50 pc share each) at a cost of Rs 16,60,000 (15,00,000 cost + 1,60,000 registration fee). Mr X and Mrs X took housing loan of Rs 13,00,000 from a nationalised bank for buying this house in joint name.
My question is:-
What will be the capital gain on sale of plot in Rs 7,00,000? Mrs X will be eligible for rebate u/s 54 up to what extent as she had taken housing loan & not utilised the long tern capital gain fully earned on sale of plot.
— J.P. Gupta
A: Where a capital asset is jointly owned by more than one person and the share of each one can be separately ascertained, each co-owner is to be separately assessed in respect of the portion of the capital. Same is also the case for housing loans.
Moreover, she has sold a plot of land and, therefore, exemption will be available u/s 54F which requires total sale proceeds to be invested in purchase of a residential house within one year before or 2 years after (3 years in case of construction) the date of sale of the plot of land. She satisfies this test.
This section also requires the assessee to own not more than one residential house on the date of the sale. She was in possession of two residential houses on the date of sale and, therefore, the exemption is not available to her.
Rebate on interest
Q: I had taken housing loan from my department and was getting benefit of income tax rebate u/s 24 on interest accrued. Now, the principal amount is totally paid and I am paying only the interest. Am I eligible to claim the deduction u/s 24 during the financial year 2006-07?
— Atul Mehta
A: The phrase used for availability of deduction is interest payable and not interest paid. Therefore, if the company collects the loan first and interest later, the borrower will be able to claim the deduction u/s 80C on a larger amount and also claim deduction of interest u/s 24 on accrual basis. The interest payment can wait until the principal amount is collected. Some employers, especially PSUs and banks, follow this practice. Needless to observe that the deduction obtained on the basis of accrual cannot be again claimed on the basis of actual. Since you have already claimed the benefit u/s 24 on accrual basis (payable interest) you cannot claim again for the same when the amount is actually paid.
Unfortunately, there is no clarity in the Act regarding whether an assessee can claim the benefit on the basis of interest paid if he has not claimed it as interest payable.
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