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Hindujas join race for Satyam
New Delhi, February 1
The number of suitors for the beleaguered Satyam Computer is increasing as Hinduja Global Solutions (HGSL), an arm of the Hinduja Group, has evinced interest in acquiring the troubled IT company.

M&M may also line up
Davos: The Mahindra and Mahindra group, with major interests in IT, on Sunday said it would look at acquiring the troubled Satyam Computer Services if it finds a strategic value in the deal.

SEBI: Disclose pledged shares within 7 days
New Delhi, February 1
Market regulator SEBI has asked all listed companies in the country to make disclosures on shares pledged by promoters within seven days and has amended the relevant regulations on this.

Glaxo to axe 6,000 jobs
London, February 1
Glaxo SmithKline, Britain's biggest pharmaceuticals company, plans to axe around 6,000 jobs around the world as it faces up to the growing challenges in the industry, a media report today said.


EARLIER STORIES





This file photo shows Japan's auto giant Toyota Motor workers on a Lexus car assembly line at the company's Kyushu plant in Miyata City in Fukuoka prefecture, Japan's northern island of Kyushu. Asia's auto industry faces a dramatic slowdown in 2009 as the global financial crisis puts the brakes on sales, with Japan and Korea hit hard by weakening demand in the United States and Europe. — AFP

RCom starts GSM services in Delhi
New Delhi, February 1
Reliance Communications (RCom), country’s largest CDMA mobile service operator, today became the only telecom service provider to offer nationwide GSM and CDMA services.

Markets gain ground on short covering
With the third quarter results season almost coming to an end, the focus will once again shift to global shores for forthcoming trend. More populist measures by government ahead of general elections and rate cuts by the RBI with inflation near an 11-month low may boost sentiment.

No cap on monetary gift to relative
Q. Can a daughter give money as a gift to her mother when, her own (daughter's) yearly income has been Rs 1,75,000 ? What is the amount that can be given as gift as token of love and affection?

 





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Hindujas join race for Satyam

New Delhi, February 1
The number of suitors for the beleaguered Satyam Computer is increasing as Hinduja Global Solutions (HGSL), an arm of the Hinduja Group, has evinced interest in acquiring the troubled IT company.

Company officials told PTI that HGSL has sent a formal communication to Goldman Sachs, the newly-appointed investment banker for Satyam, saying that it is keen to participate in the bidding process as and when it starts.

The company has over $100 million in books and if required promoters Hindujas would also chip in, the officials said.

The Satyam board, which is meeting on February 5, is likely to take stock of such proposals.

With HGSL joining the race, the parties in race for the scam-hit company has increased to three. Engineering giant L&T and diversified group Spice Group are the other two.

Officials of iGate, which had earlier evinced interest, said the company would only be able take a call on sending the formal proposal after the restated financial figures are out. "Till then we would wait and watch," they said.

Meanwhile, an alternative asset management firm Kolbert Kravis Roberts and private equity firm Texas Pacific Partners (TPG) were non-committal on their interests in Satyam. A KKR spokesperson said, "As a matter of company policy we never comment on enquiries or speculative market rumours of this nature." A TPG spokesperson also said, "We will have no comment here." Tarun Das, a member of the government appointed Satyam board had earlier said that many private equity players had approached the board of the company.

One of the suitors, L&T, has already increased its stake in Satyam to 12 per cent from over four per cent earlier, while asset management firm Fidelity upped its stake in Satyam to 7.66 per cent.

The other suitor Spice Group, which has made a formal bid for the scam-hit Satyam Computers, wants auction route for the acquisition of the company as the chairman B K Modi feels auction is the most transparent way.

"I don't want a negotiated deal. We want auction of the company as that is the most transparent method to decide on the valuation. We want to enter the company through the preferential route.

"Auction can take care of the legal liabilities that is attached to the company which is in a bad shape," Modi said. — PTI

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M&M may also line up

Davos: The Mahindra and Mahindra group, with major interests in IT, on Sunday said it would look at acquiring the troubled Satyam Computer Services if it finds a strategic value in the deal.

"We have a major IT company. We are watching the situation with interest. If there is anything of strategic value, clearly we will be looking at it," M&M vice-chairman and managing director Anand Mahindra told PTI on the sidelines of the World Economic Forum meeting here.

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SEBI: Disclose pledged shares within 7 days

New Delhi, February 1
Market regulator SEBI has asked all listed companies in the country to make disclosures on shares pledged by promoters within seven days and has amended the relevant regulations on this.

Following its decision at a board meeting held on January 21, the regulator has outlined the norms for disclosure about pledged promoter shares in an amendement to the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997.

SEBI's decision to make it mandatory for promoters to disclose pledged shares follows troubled IT firm Satyam Computer revealing last month that all its promoter shares were pledged with lenders and a large portion of that had been sold.

The SEBI board had decided in its meeting on January 21 that such disclosures should be made as and when the shares are pledged as well as by way of periodic disclosures.

The regulator has said that details of pledging and release or sale of pledged shares should be made to the company, which in turn would inform the public about it through the stock exchanges.

The new regulations, approved by SEBI chairman C B Bhave and the regulator board, make it mandatory for the promoters of a company to disclose details of shares pledged by them to the firm within seven working days of commencement of the amended regulations.

The new regulations came into force with their publication in the Government of India Gazette on January 28.

Besides Satyam, companies such as Pyramid Saimira, Rolta India, Godrej Consumer, Mindtree, Asian Paints and Temptation Foods have disclosed share pledging by their promoters.

Going forward, the new regulations call for the promoters to disclose details of pledged shares within seven working days from the date of creation of such pledge.

Promoters would also have to disclose within seven working days from the date of invocation of pledging the details of such invocation. — PTI

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Glaxo to axe 6,000 jobs

London, February 1
Glaxo SmithKline, Britain's biggest pharmaceuticals company, plans to axe around 6,000 jobs around the world as it faces up to the growing challenges in the industry, a media report today said.

The cuts are expected to include hundreds of British jobs, The Sunday Telegraph claimed.

"Competition from generic manufacturers and doubts about company's (product) pipelines are posing a serious threat to the sector and, ING analysts warned of an intellectual property meltdown as top-selling products come off patent and sales slow dramatically", the newspaper stated.

Glaxo employs about 1,00,000 people and, although yet to be confirmed, a proportion of the cuts are almost certain to be among its 18,000 staff at sites across the UK, which would strike another blow to the battered economy. — PTI

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RCom starts GSM services in Delhi
Tribune News Service

New Delhi, February 1
Reliance Communications (RCom), country’s largest CDMA mobile service operator, today became the only telecom service provider to offer nationwide GSM and CDMA services.

With the launch of GSM services in Delhi and NCR region, RCom has spread its mobile network in pan India.

RCom’s head of operations (Delhi and NCR) C.S. Rana said here that RCom would be looking for dominant share of the mobile market in Delhi and NCR, which would now see as many as seven telecom operators offering their services.

In fact, the launch of GSM services by RCom would provide the customers with a choice of having both the CDMA and the GSM service from the same operator, he said.

As a starter, RCom is offering the GSM services only in the pre-paid category and would launch in the post-paid category over the next two weeks. It has also come out with an introductory offer for a limited period.

The company also launched a first-of-its-kind customer experience programme for customers choosing Reliance Mobile GSM services, a unique plan which offers lifetime SIM just for Rs 49 and full savings on Rs 150 ARPU for customers at a one-time subscription charge of Rs 51 only.

The plan offers 450 minutes of talktime on local calls and SMS to any network that can be accrued by Reliance Mobile GSM customers in daily tranches of Rs 5 spread over 90 days.

ADAG to rejig infra, telecom biz

New Delhi: With an aim to unlock shareholder value through possible investment by strategic and financial partners and bring in more transparency, Anil Ambani group (ADAG) is planning a major restructuring exercise for some of its business divisions at its infrastructure and telecom arms. The reorganisation and restructuring schemes, approved by the directors of Reliance Infrastructure and Reliance Communications at separate meetings this weekend, are aimed at unlocking value, simplifying the business structure and bring in greater transparency. — PTI

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Market Update
Markets gain ground on short covering
by Lalit Batra

With the third quarter results season almost coming to an end, the focus will once again shift to global shores for forthcoming trend. More populist measures by government ahead of general elections and rate cuts by the RBI with inflation near an 11-month low may boost sentiment. High volatility may not be ruled out in a reaction to local and global developments. Lok Sabha polls are likely to be held between April 8 and May 15, 2009. However, no specific date has been finalised yet. The term of the 14th Lok Sabha expires in May and announcement of the poll schedule is expected soon.

Meanwhile, the markets ended the truncated week with smart gains. Buying frenzy in index pivotals, coupled with short covering of open positions ahead of January 2009 derivative contracts on Thursday (29 January) triggered a solid rally in key benchmark indices in the first two session of the last week.

Positive tidings from global markets also boosted sentiments. The US House of Representatives passed a $ 825 billion stimulus plan in President Barack Obama’s first legislative achievement since taking office last week, with the debate now shifting to the Senate.

In India, last week kicked off with the RBI’s third quarter review of the monetary policy. Highlighting the context in which the central bank put forth its views, it went on to emphasise that the loss of confidence in the global financial markets has set off a chain of deleveraging, declining asset values, falling income, contracting demand and rising unemployment. Importantly, the RBI sought attention to the distinction in monetary policy actions in the developed and developing economies of late, which have been the underlying basis for the review. It stated that while the crisis that originated in the financial sector in the US spread almost immediately to Europe, it did not disturb the fundamental strength of banking entities in developing markets. The latter were materially impacted by only three factors capital flow reversals, drying up of overseas lines of credit and significant deceleration in global trade reducing the demand for exports. Resultantly, the monetary policy actions in emerging markets have also been attuned to real economy problems rather than financial sector problems.

IDFC

IDFC, being the largest private sector infrastructure-financing player in the country makes the rationale for company’s growth uncontested. Nonetheless, increasing penetration of institutions in this segment and their cost advantage (due to the ability to raise low cost deposits) has intensified competition for IDFC over the past few years. However, having the domain expertise for project appraisals, and diversification of its business model to infrastructure fund management in association with globally recognised institution has reasonably de-risked its business. With one of the highest capital adequacy ratios, and one of the best asset qualities in a low liquidity-high risk environment, IDFC is amongst our preferred plays in the financial sector. Investors may take exposure at the current market price of Rs. 58 with a three years perspective (minimum) for the entire story of the infrastructure to pan out.

Poor infrastructure had been one of the key factors holding back a double-digit growth rate for India even during times of economic buoyancy. With infrastructure spending currently at around four per cent of GDP, India is way behind achieving the level of 12 per cent by the end of the Eleventh Plan period, as suggested by the Asian Development Bank (ADB). IDFC being the largest private sector infrastructure financing institution in the country (with a 20 per cent share of the private sector pie) certainly has a prominent role to play in this.

On the top of it, IDFC has one of the strongest asset quality positions amongst the financial entities in India (rivaled only by HDFC). According to the institution, this has been achieved due to its strong credit and project appraisal skills and disciplined risk management practices.

Keeping all above factors in mind, we view a robust growth scenario for IDFC despite the slowdown. Hence it seems an ideal pick for conservative investors.

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Tax Advice
No cap on monetary gift to relative
by S.C. Vasudeva

Q. Can a daughter give money as a gift to her mother when, her own (daughter's) yearly income has been Rs 1,75,000 ? What is the amount that can be given as gift as token of love and affection?

Can a son-in-law give money as gift to his mother-in-law as token of love and affection? If so what is the amount if:

(i) The donor is a taxpayer.

(ii) The donor is non-taxpayer.

Can a person give gift for the amount he can afford as per his bank balance?

— Gurbachan Singh, Hoshiarpur

A. Your queries are replied as under:

1. There is no monetary limit for a gift being given by a daughter to her mother. It would depend upon her capacity to make such a gift.

2. There is no prohibition under the Income-tax Act 1961 (the Act) for son-in-law to gift any amount to his mother-in-law even if the donee is not a tax-payer.

3. A gift received by an individual for an aggregate amount of Rs 50,000 after the 1st day of April 2006 would be exempt from tax provided the gift has been received-

(a) from any relative; or

(b) on the occasion of the marriage of the individual; or

(c) under a will or by way of inheritance; or

(d) in contemplation of death of the payer; or

(e) from any local authority as defined in the Explanation to clause (20) of section 10; or

(f) from any fund or foundation or university or other educational institution or hospital or other medical institution or any trust or institution referred to in clause (23C) of section10; or

(g) from any trust or institution registered under section 12AA.

The term relative for this purpose has been defined as under:

(i) spouse of the individual;

(ii) brother or sister of the individual;

(iii) brother or sister of the spouse of the individual;

(iv) brother or sister of either of the parents of the individual;

(v) any lineal ascendant or descendant of the individual.

(vi) any lineal ascendant or descendant of the spouse of the individual;

(vii) spouse of the person referred to in clauses (ii) to (vi).

Senior Citizen Savings Scheme

Q. I am senior citizen. I want to invest Rs 1 lakh in the Post Office under the Senior Citizen Savings Scheme. Can I claim rebate of Rs 1 lakh under Section 80C?

— Parshotam Dass

A. The amount deposited under Senior Citizen Saving Scheme in the Post Office has now been covered under Section 80C of the Act and deduction thereof against the total income will be allowed within the overall limit of Rs 1 lakh provided under the said section.

Tax liability

Q. I am a family pensioner and retired from PSEB on 30.09.2006 after attaining age if 58 years. I have PAN from the Income-tax Authority and file return of pension/income in each year.

On 20.08.2007, I opened a F.D. of Rs 5,00,000 in bank as joint account of wife and husband for 455 days, which matured on 26.11.2008. The amount becomes Rs 5,61,941. The bank during March 2008 filled form 15G and get signed from my wife, who is a housewife and has no other income. The bank deducted TDS of Rs 3,364 on 20.11.2008. My wife's age on 31.10.2008 was 59 years, and my age on 30.09.2008 was 60 years. Now, we have extended FD for next one year i.e. up to 29.11.2009. I represented to the bank for refund of TDS deducted, which has been credited in my saving account.

My queries are as under:

1. My total income for

previous year 3/2008

to 2/2009 1,64,625

2. Medical fix expenses

3/2008 to 2/2009

with support voucher 1,610

3. TDS received from

bank in Saving Account 3,364

Please calculate my Income-tax for the year 2008-09

— Bharat Bhushan, Pathankot

A. It is not possible to compute the tax liability in respect of your total income as one of the components of such income i.e. interest due on fixed deposit upto 31st March 2009 has not been indicated. The amount of interest due up to 31st March 2009 will have to be added to your income. The tax slab in your case should be 10%. You can compute the tax by applying the above rate and adding thereto surcharge for education cess @ 3% of the tax so computed.

Senior citizen

Q. My sources of income are from pension and interest on fixed deposits (MIS). I will complete 65 years of age on 16.07.2009. Please clarify if I am eligible for tax rebates of senior citizen (65 years and above) for the financial year 2008-09 (assessment year 2009-10).

— Shashi Bala, Zirakpur

A. On the basis of the facts given in the query you will be entitled to the status of senior citizen for the financial year 2009-10 i.e. assessment year 2010-11.

Tax on perquisite

Q. I am working in a nationalised bank as an officer. Recently the bank provided me furniture worth Rs 60,000 + VAT. Whether the furniture provided by employer is taxable or not? If taxable, what formula I should use to add it in my gross income to calculate the same? Is this amount will be fix for perks? If yes, how?

— Ram Adhar, Tohana

A. According to Rule 3(7)(viii) of the Income-tax Rules 1962, the value of benefit from the use by the employee or any member of his household of any moveable asset other than laptop and computers belonging to the employer or hired by him is to be computed @ 10% per annum of the actual cost of such asset or the amount of rent or charge paid or payable by the employer as reduced by the amount if any, paid or recovered by the employee for such use. In view of the above, 10% of the total cost of the furniture would be the perquisite value of the benefit and added to your salary for the purpose of computing the total income-tax payable by you.

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