New Delhi, May 15
In the wake of Comptroller and Auditor General (CAG) rapping the Income Tax Department over “wrong benefit” of income deduction, the government has decided to reopen the income tax assessments of cricket icons Sachin Tendulkar and Sunil Gavaskar.

“We will reopen and review the income tax assessments (of Tendulkar and Sunil Gavaskar) in line with the CAG’s findings. We don’t take any chance when there is a possibility of revenue loss to the government… We can’t allow any possibility of revenue loss,” A.J. Majumder, Member of Central Board of Direct Taxes (CBDT) said here today reacting to the CAG report tabled in Parliament yesterday.

Asked whether responsibility will be fixed on the assessing officer concerned for such an error pointed out by the CAG, Majumder said “assessment is done by the respective assessing officer as per interpretation of law. In this case, it involves interpretation of a particular provision, which is section 80RR of the Income Tax Act.”

Clearly indicating that the IT Department will make all efforts to recover the money, Majumder said “whenever such a situation arises we take remedial action. The assessments will be reopened and fresh assessments will be made in line with the CAG observation.”

He also indicated that the recovery effort could be a long drawn process. “There is an appellate authority system in place and the matter can go from appellate level to high court and if needed, also up to the Supreme Court,” he said.

The CAG in its report has faulted the Income Tax Department for giving incorrect allowance of deduction of income for both players for their earnings not from the game, but endorsements and commentating.

The audit scrutiny of assessment records in respect of Sachin Ramesh Tendulkar assessed under the charge of CIT-XIX, Mumbai revealed that aggregate deduction of Rs 8.89 crore was allowed on foreign remittance received by him on account of sports endorsement, i.e. advertisements and publicity activities.

The CAG report noted that as the income was not derived from the “profession of sportsman”, allowance of deduction was not in order. It said that Income Tax Department’s argument that the assessee had derived it in the capacity of “artist” was not acceptable as the assessee had received this income in the capacity of a model which cannot be construed as an artist for the purpose of this section.

London/Frankfurt, May 15
Germany’s Heidelberg Cement AG has agreed to buy Britain’s Hanson Plc for £8 billion ($15.8 billion) to create the world’s second largest construction materials firm.

Hanson agreed to an offer of 1,100 pence per share in cash, the two companies said on Tuesday.

The deal would be the biggest takeover in the sector and would make the firm second largest in the world by market capitalisation with revenues of about Euro 15 billion ($20.3 billion) and more than 70,000 employees, the statement said.

“It is consistent with our focus on strategic expansion into complementary geographies, across diversified products and customer markets,” Heidelberg chief executive Bernd Scheifele said, adding “We believe that the combined business will be better able to respond to the evolving needs ... in the competitive and rapidly consolidating global building products industry.”

The acquisition highlights growing attractiveness of Hanson as the sector consolidates and companies look to boost margins and increase market share in a highly fragmented industry.

Heidelberg said the deal would be completed in the third quarter and would be financed through a combination of hybrid capital issuance of up to Euro 2 billion, sale of debt and divestment of selected non-core assets.

Deutsche Bank and the Royal Bank of Scotland have fully underwritten the acquisition facilities, it said.

The offer price represents a premium of around 50 per cent to the average closing mid-market price of 734 pence per share for the 12 months to May 2, last business day prior to the announcement of Heidelberg’s interest.

Deutsche Bank is acting as financial adviser to Heidelberg and Rothschild is Hanson’s financial adviser. — Reuters

New Delhi, May 15
An airlines industry body has sought reduction in customs and excise duties on aviation turbine fuel (ATF) and allowing private firms to supply it to bring down prices.

The Federation of Indian Airlines (FIA) has said high sales taxes imposed by state governments made the jet fuel prices, which account for almost 40 per cent of an airline’s annual expenditure, prohibitive.

Comparing ATF prices with those at major South-east Asian and Gulf airports, the federation said ATF prices in India were 73 per cent higher than in these countries.

The ATF price in Singapore in March this year were Rs 20,779 per kl while in India the prices were above Rs 30,000, it said, adding that customs duty of 10 per cent and excise duty of 8.24 per cent was levied on it by the central government. Public sector oil firms had, on May 1, raised jet fuel prices by 3.5 per cent. — PTI

Bhubaneswar, May 15
A scary abduction episode and nagging land woes will not frighten away South Korea's Posco from Orissa, where the company plans to start work on its Rs 52,000 crore steel plant in October.

"We have been delayed by about six months, but we hope to start preparatory work on the ground from October," Posco India Chairman and Managing Director Soung-Sik Cho said here.

The project, an agreement for which was signed with the Orissa government nearly two years ago, has been plagued by land acquisition problems with locals opposing plans to displace them.

The catharsis of this struggle was the abduction of three Posco officials at Gobindapur village near Paradip — the proposed site for the project — on Friday. While a woman employee was released immediately, the other two were let go after 10 hours in captivity.

"But Posco-India has decided to continue its efforts to directly reach out to the people of the area and inform them about what the company wants to do there and the resettlement and rehabilitation (R and R) package readied for those who would be required to be displaced," Cho said.

Of the 4,004 acres the Korean company requires for the project, only 438 acres was privately owned with eight villages belonging to three panchayats of Dhinkia, Nuagaon and Gadakujanga needed to be relocated. — PTI

New Delhi, May 15
With a mechanism in place to monitor money laundering, there have been no instances of terrorists money being laundered in the Indian stock market, union finance minister P Chidambaram told the Rajya Sabha today.

Responding to a question on the role of foreign investment institutions (FIIs) in being conduits to bringing in terrorist money into the country, Chidambaram observed that national security adviser M K Narayanan had stated there could be isolated incidents of terrorist organisations manipulating the stock market.

“The finance ministry had sent a formal query to the National Security Council (NSC) and asked them to inform the government of any specific instances that may have come to their notice. But they had no specific information.”

Trinamool Congress MP Dinesh Trivedi promptly said the NSA statement was widely publicised and echoed the US government’s concerns that terrorists were investing in the Indian stock market.

When Sushma Swaraj asked if terrorists could be using the FIIs to smuggle their money, Chidambaram said: “All FIIs are regulated entities in their respective jurisdictions. When an FII applies for investment, the Securities and Exchange Board of India examines its application carefully and sometimes permission to invest in the stock market is held back for several months.”

When Swaraj suggested more safeguards, the finance minister expressed confidence that the laws in place were adequate but he was open to suggestions.

New Delhi, May 15
The Bombay Stock Exchange (BSE) has informed the government that it might come out with an Initial Public Offer (IPO) at an appropriate time.

“The BSE has informed that depending upon the need and circumstances, it may consider IPO at an appropriate time,” minister of state for finance Pawan Kumar Bansal told the Rajya Sabha today, adding that the National Stock Exchange (NSE) does not have any such plans as of now.

Post IPO, the scrips will be traded on the BSE.

The government has already given approval for induction of certain foreign investors as shareholders in the BSE and the NSE.

Over 20 domestic and local companies, including the State Bank of India and Life Insurance Corporation, are reportedly in fray for stake in the BSE.

The trading members of the exchange are required to reduce their equity shareholding to 49 per cent as per the BSE (Corporate and De-mutualisation) Scheme, 2005 and the SEBI regulations.

The BSE has already offloaded 10 per cent stake to Deutsche Bourse and Singapore Exchange Ltd and the remaining 41 per cent has to be diluted by May 19.

Meanwhile, as many as 13 companies listed on the BSE and seven on the NSE have not complied with clause 49 of the listing agreement during the quarter ended March 31.

The BSE has informed that for the quarter ended March 31, of the 204 companies in Group A, 13 have not complied with Clause 49 stipulations.

In case of the NSE Nifty, seven out of 50 companies have yet to follow the Clause 49 guidelines, Bansal said. — PTI

Mumbai, May 15
A political battle is in the making in Maharashtra, whose revenue minister Narayan Rane has said there is no bar on land acquisition for the Reliance SEZ project despite Chief Minister Vilasrao Deshmukh's explicit orders to halt it.

Rane, a former Chief Minister, told reporters yesterday that there was no reason to halt the land acquisition exercise and it would continue as per rules.

Deshmukh had in March put a freeze on land acquisitions in Raigad district, where the proposed multi-product SEZ would come up.

The project, promoted by Reliance Industries (RIL) chairman Mukesh Ambani and RIL SEZ division head Anand Jain, last week failed to get clearance from the Board of Approvals as the union revenue department wanted more details on measures proposed by the promoters to plug revenue leakages.

Earlier, an empowered Group of Ministers had put a cap on the size of SEZs to 5,000 hectares, whereas the land requirement for proposed Reliance SEZ is pegged at 10,000 hectares. — PTI

Mumbai, May 15
Suzlon Energy Ltd, world’s fifth largest turbine maker, said a strong rupee dented quarterly profits and it was looking towards Europe and China for growth.

The company said its January-March consolidated net profit fell by 3.4 per cent.

Suzlon Energy today posted a net profit of Rs 437.82 crore for the quarter ended March 31 and the total income of the company was Rs 2,097.55 crore, the company said in a communique to the BSE.

For the year ended March 31, Suzlon recorded a net profit of Rs 1,061.14 crore while the total income was Rs 5,468.47 crore.

The company earned 80 per cent of its revenues for the year to end-March in dollars, and said the strength of the rupee had hit margins.

Suzlon’s chairman and managing director Tulsi Tanti said it was diversifying its currency exposure and expected 2007-08 revenues to consist of 20 per cent each from the euro and dollar, and the rest from the rupee and Chinese yuan.

As part of growth strategy, Suzlon is battling with French nuclear energy group Areva for control of German wind turbine maker RE power.

“RE power is important for us on two aspects - we can accelerate growth in the European market and get access to offshore technology,” Tanti said.

Tanti said Europe and China would contribute significantly to the company’s growth in coming years, adding that the company will invest Rs 3,300 crore during the current fiscal.

“Most of the investment will be done in India, while Rs 800 crore will be invested in Belgium,” Tanti said. — Agencies

Chandigarh, May 15
After the mobile operators’ foray into the rural areas, it is now the turn of the mobile handset manufacturers to woo the rural masses. By slashing down the prices of handsets and launching special rural retail plans, almost all major players are now out to increase their market share from this huge untapped segment.

Having identified that the rural consumer is driven towards a device that helps in communication, rather than a feature-driven device, mobile companies have now launched special phones at most affordable rates.

With India emerging as the fastest growing market in mobile telephony, with 6-6.5 million new subscribers being added each month, none of the major players in the mobile handset market is willing to leave anything to chance. If market leader, Nokia has launched seven new low-cost handsets (Rs 2,100 - Rs 5,400), Reliance has launched colour handsets at just Rs 1,234 and monochrome handsets for just Rs 777.

Lloyd Mathias, marketing director, mobile devices, Motorola India, says that with real growth now in the rural sector, the companies have slashed the prices and come up with phones having basic features.

In fact, it was Motorola that had changed the mobile retailing concept in India with the launch of low-cost handsets last year. Not to be left behind, Nokia, with its over 70 per cent market share, Samsung, Sony Ericsson and LG, too, got into aggressive retailing by cutting down their prices. This has meant windfall for the customers, with prices of all popular handsets going down by 15-20 per cent in the last one year.

Sunil Dutt, sales director, Nokia India, however, denies that the pricing strategy is linked to fierce competition for the share of the huge mobile handset pie.

New Delhi, May 15
NYSE-listed BPO company WNS today reported about 141 per cent increase in its net profit at $8.9 million for the quarter ended March 31.

The company's revenues grew by over 109 per cent at $110.7 million , WNS said in a statement.