SPECIAL COVERAGE
CHANDIGARH

LUDHIANA

DELHI



THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS

B U S I N E S S

Railways plans malls, logistics parks 
New Delhi, September 22
Bracing to carry more freight and face competition from road and air carriers, Indian Railways will soon set up several integrated logistics parks on unused land across the country. It will be developed along major stations across the country, including one in the eastern sector through public-private participation model.

UK minister’s visit on Sept 25
Chandigarh, September 22
To woo Punjabi industrialists and entrepreneurs, the UK minister of state for trade and investment, Lord Jones of Birmingham, will be in Chandigarh on September 25 to address a joint meeting with the Chief Ministers of Punjab and Haryana at the CII here.

Movies at fuel stations!
Mumbai, September 22
With a view to increasing its non-fuel revenue-stream, oil PSU, BPCL, has tied up with Cinemata, a film distribution unit of Sony Entertainment Television, to set up cinema halls at its 300 fuel outlets on highways across the country by FY 2010.



EARLIER STORIES

 
A girl talks on her cellphone in Chandigarh. According to figures released by Telecom Regulatory Authority of India (TRAI) on Saturday, the number of mobile phone subscribers has crossed the 200-million mark after the country added another eight million customers last month.— Tribune photo by Pradeep Tewari
A girl talks on her cellphone in Chandigarh. According to figures released by Telecom Regulatory Authority of India (TRAI) on Saturday, the number of mobile phone subscribers has crossed the 200-million mark after the country added another eight million customers last month.
— Tribune photo by Pradeep Tewari

Aviation Notes
Gulf route potential under-exploited
Even in the highly sensitive civil aviation sector, the International Civil Aviation Organisation (ICAO)-approved flying rules are being violated with impunity.

RIL strikes oil in KG Basin
New Delhi, September 22
Reliance Industries Limited (RIL) today said it has made oil discovery in the deepwater block KG-DWN-98/1 (KG-D4) located in the Krishna Basin in the east coast.This is the first time an oil discovery has been made in the Krishna deep-water basin. This deep-water block was awarded to RIL under first round of NELP bidding.

Investor Guidance
Business loss cannot be set off against salary

Q: I am getting salaried income of Rs 3.5 lakh per year and also I am making variable income through business. Is there any way to show business losses as tax saving?- — Sanket

 
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Satyam to expand in Malaysia.
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Railways plans malls, logistics parks 

New Delhi, September 22
Bracing to carry more freight and face competition from road and air carriers, Indian Railways will soon set up several integrated logistics parks on unused land across the country.

It will be developed along major stations across the country, including one in the eastern sector through public-private participation model.

"We have identified some areas in metro cities where such parks would come up along the railway stations. Our equity in the logistic park project would be land," said a senior railway ministry official.

He said the railway would offer the land to private sector for setting up facilities like warehouses, cold storages, banks, repair facilities for trucks, godwons, custom facilities and multi-modal transport system.

The basic criteria for such parks is that they should be near national highways and in metros. Because big cities are also major economic zones, these parks would cater to the growing demand of commercial activities in the cities, the official said.

The railways has a total 4.23 lakh hectares of surplus land out of which 42,846 hectares is vacant and located along rail tracks.

The role of the railways will be that of a catalyst by facilitating the process of setting up the parks by giving land and ensuring other support like water and electricity.

Though the number of such parks to be set up has not been finalised yet, there are about 20 possible sites which can be considered for the project, the official said.

"We are also trying to involve state governments in setting up these parks. There are also a few states, including Punjab, West Bengal, Gujarat and Haryana which have elicited interest in the project," said the railway official."The railways has plenty of surplus land. So, converting some of our unused land into logistic parks and other commercial activities like malls, shopping and office complex, hotels will fetch good revenue for the department," he added. — PTI

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UK minister’s visit on Sept 25
Tribune News Service

Chandigarh, September 22
To woo Punjabi industrialists and entrepreneurs, the UK minister of state for trade and investment, Lord Jones of Birmingham, will be in Chandigarh on September 25 to address a joint meeting with the Chief Ministers of Punjab and Haryana at the CII here.

Lord Jones’ visit is in continuation of the launch of the Wolverhampton-India Project in July this year, which was followed by a visit of the British trade and investment delegation to Chandigarh and Ludhiana last month.

The Wolverhampton-India Project has been designed to help the UK authorities, business and universities of finding ways to strengthen ties with one of the fastest-growing economies in the world, especially when about 15 per cent of the population in Wolverhampton is Indian, mainly Punjabis.

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Movies at fuel stations!

Mumbai, September 22
With a view to increasing its non-fuel revenue-stream, oil PSU, BPCL, has tied up with Cinemata, a film distribution unit of Sony Entertainment Television, to set up cinema halls at its 300 fuel outlets on highways across the country by FY 2010.

“We are undertaking two pilot projects at our retail outlets in Gujarat. If successful, the same will be replicated in other outlets across the country," BPCL chairman Ashok Sinha said here.

Each cinema hall will have seating capacity of 150 to 200 and the films in digital format would be beamed at the fuel stations.

The movies will be shown to neighbouring villages and highway travellers via satellites. — PTI

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Aviation Notes
Gulf route potential under-exploited
by K.R. Wadhwaney

Even in the highly sensitive civil aviation sector, the International Civil Aviation Organisation (ICAO)-approved flying rules are being violated with impunity.

The air traffic confusion over Punjab airspace between VIP aircraft (Air Force Boeing 737) and Virgin Atlantic Airbus (four-engine aircraft) occurred on September 10. But the authorities did not announce probe until newspapers screamed on September 18.

The delay in probe seems deliberate. Such laxity shows that the civil aviation is still passing through a difficult phase.

Aviation analysts believe that the probe might not have been instituted if Congress president Sonia Gandhi and other VIPs were not aboard the flight in the IAF plane.

Several pertinent questions arise in the wake of the near-miss:

1. Why was the aircraft, which was not technologically upgraded (it was without RVSM - Reduced Vertical Separation Minima), provided for VIP flying?

2. Did home minister Shivraj Patil, who had booked the aircraft, write to Air Force that Ms Gandhi was among other VIPs on the flight?

3. Why did the two vital organisations - Directorate-General of Civil Aviation (DGCA) and Air Force - delay the probe for eight days?

4. Why is there a steep rise in air-miss when corridors have been widened? Is it not disturbing that near-miss incident should be taking place every 15 days?

According to analysts, the paucity of air traffic controllers is not the only cause. They maintain that there is lax control and there is not much coordination among (1) ATCs, (2) DGCA, and (3) commanders. If the system is not upgraded immediately, there may be another serious mishap as it happened on September 12, 1996, when as many as 349 persons perished in a crash near Charkhi Dadri (Haryana).

Apart from merger woes, financial constraints, irregular flow of arrival of new aircraft, the IPO has been deferred. Amidst all these problems, private carriers are being preferred to Air India.

Jet Airways, for example, is a rising carrier. After being allowed to fly on the US route, it is being allowed to spread wings on the lucrative Gulf routes.

This may lead to enormous problems for Air India. Competition is essential but providing out-of-turn facilities to private operators is another. If the government does not stand by Air India, who will?

Despite exorbitant fuel prices, the fares may drop a bit when Jet starts operations from January 1. There is, however, a lot of scope for increased traffic on the Indo-Gulf routes. India’s entitlement is 85,481 seats a week while its utilisation is 49,348.

For providing befitting impetus to civil aviation in the country, ground-level should be one for all.

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RIL strikes oil in KG Basin
Tribune News Service

New Delhi, September 22
Reliance Industries Limited (RIL) today said it has made oil discovery in the deepwater block KG-DWN-98/1 (KG-D4) located in the Krishna Basin in the east coast.

This is the first time an oil discovery has been made in the Krishna deep-water basin. This deep-water block was awarded to RIL under first round of NELP bidding. RIL holds 100 per cent participating interest in this block, which spans over an area of 8100 sq km, a company statement said.

The oil find in this exploration block marks a new beginning in this basin. The well was located in a water depth of 565 metres and was drilled to a target depth of 3,595 metres.

This discovery namely ‘Dhirubhai - 36’ has been notified to the petroleum ministry and Directorate General of Hydrocarbons.

This oil discovery comes after nearly two decades of exploration history, with more than 30 exploratory wells drilled by various operators in this geologically complex basin.

The potential commercial interest of the discovery is being ascertained through integration of additional data and analysis.

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Investor Guidance
Business loss cannot be set off against salary
by A.N. Shanbhag

Q: I am getting salaried income of Rs 3.5 lakh per year and also I am making variable income through business. Is there any way to show business losses as tax saving?

— Sanket

A : Business loss cannot be set off against salary and accordingly, you would need to pay the requisite tax on your salary income and carry forward the business loss to future years and set off such loss against future taxable profits.

STT on share purchase

Q: I had purchased shares about six years ago, when there was no STT applicable either on purchase or sales of shares. Now, I intend to sell these shares through the NSE by paying the STT on sale of these shares. Will I be liable to pay for any capital gain tax or the total receipts will be completely tax free? Or, in the alternative, the cost price of shares purchased six years ago will be indexed and the capital gain tax will be payable after considering the indexed cost? If in the alternative any capital gain tax is payable, at what rate is it payable?

— Ranawat

A: Section 10(38) exempts “any income arising from the transfer of a long-term capital asset, being an equity share in a company or a unit of an equity oriented fund where:

(a) the transaction of sale of such equity share or unit is entered into on or after the date on which Chapter VII of the Finance (No. 2) Act, 2004 comes into force; and

(b) such transaction is chargeable to securities transaction tax under that Chapter.”

Consequently, the payment of STT at the purchase of the shares (or MF units) is immaterial and inconsequential for the purpose of the exemption.

Long-term loss

Q: I have long term capital loss of Rs 39,000 on transaction done on the NSE/BSE on shares, where I have paid STT. I have shares of Ambuja Cement, which I had purchased more than a year ago. If I submit these shares in the forthcoming open offer of Ambuja Cement in November, I will incur long term capital gain. As this transaction will be outside market (exchanges), I will not pay STT. So, I will have to pay capital gain tax at 20 per cent with indexation benefit or at 10 per cent without indexation. Can I set off this capital gain (from open offer) from the above mentioned long term loss of Rs 39,000?

— R C Randeria

A: The long-term capital loss, on which you have paid STT, cannot be set-off against non STT paid long-term capital gains.

Gift under income tax

Q: I wish to know the provisions of gift under income tax. If I receive a gift from my brother, who is an NRI, or make a payment through cheque of an NRI account here in India of amount greater than Rs 5 lakh, will I be charged any thing as tax for the amount received as gift? If yes, then how much? If not, what documents are required to show the validity of that gift. Also, will I have to show the same in the income tax return I will be filing for the year, in which I have received the gift?

— Mohan Sardesai

A: As per Section 56 of the ITA, there is no gift tax applicable for gifts between relatives. So, your brother can give you any amount of gift and the same will not be taxable in your hands. As far as documentation is concerned, all that is required is an offer letter from the donor and an acceptance letter from the recipient.

NRI status

Q: I am a mariner working in Merchant Navy. In case of not being able to complete more than 182 days outside India, I’ll lose my NRI status. So, in such case, what are the tax laws if I am short by 10-15 days? Please note that all my income will be earned in foreign currency outside India.

— Arush

A: The 182-day rule is critical to decide your NRI status. If you fall short by 10-15 days, then it is suggested that you do not come back to India before such time i.e. go on a vacation directly from the job. This way you would still be considered out of India on employment. If you come to India and then, during the year, go out on vacation for the remaining 10-15-day period, it would not count as you are not leaving India on employment.

The authors may be contacted at wonderlandconsultants@yahoo.com

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