SPECIAL COVERAGE
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LUDHIANA

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THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS
B U S I N E S S

Job loss: Govt offers help to India Inc
New Delhi, February 8
With the employment situation getting worse in the backdrop of global economic meltdown, the government has said it was ready to take “any measures” to help Indian industries prevent further loss of jobs.

Tata Motors to hire 1,650 workers
New Delhi, February 8
Indicating that some recovery is under way, the country’s largest commercial vehicles maker, Tata Motors, is hiring over 1,650 temporary workers for its Jamshedpur plant, after temporarily stopping operations several times at the unit over the past few months.

Slump in FDI flow
New Delhi, February 8
India received just $1 billion foreign direct investment in November as fund flow turned to a trickle — making the task of matching last year’s receipts a challenge, much less achieve this year’s $35 billion goal.

UBS set to declare historic loss
Zurich, February 8
Switzerland’s largest bank, UBS, is expected to announce the biggest loss in the country’s history when it releases Tuesday its results for 2008, a year that saw the national icon tarnished by the sub-prime crisis.



EARLIER STORIES




Meltdown Pangs

Indonesian women walk outside the venue of a finance exhibition in Jakarta on Friday.
Indonesian women walk outside the venue of a finance exhibition in Jakarta on Friday. Indonesia has launched its first retail Islamic bond this month hoping to catch up with its neighbours in the Islamic finance business and help fund a $6-billion economic stimulus package. — AFP

Satyam Saga
Raju to be part of ISB curriculum
Hyderabad, February 8
After entering the crime records by scripting corporate India’s biggest fraud, former chairman of Satyam Computers B Ramalinga Raju is set to become part of the curriculum of Indian School of Business (ISB), an internationally renowned management institution here. Ironically, Raju was once part of the 30-member governing council of ISB, ranked 15 among global
business schools.

PNB aims at workforce rationalisation
New Delhi, February 8
In step with global banking trends, the country’s second-largest state-owned lender, Punjab National Bank, is expected to rationalise its workforce and reduce its staff strength by 28,000 in the next six years from 58,000 now.

Warner Bros to outsource jobs to India
New Delhi, February 8
In a move that could ruffle a few feathers in the Barack Obama administration, American entertainment giant Warner Bros has said it would be outsourcing jobs to India.

Tax Advice
Form 15H is for senior citizens only
Q. Axis Bank deducted TDS on September 30, 2008, from FDR opened on April 2, 2008, with maturity date after more than a year. I think TDS was deductible only on its maturity or earlier encashment or during March 2009 and that, too, if Form 15G/H is not submitted. The bank has taken a plea that interest as commuted quarterly and tax was also deducted whenever tax is added on quarterly commutation. The bank says other bank also deduct TDS whenever interest is commuted and all banks have separate TDS instructions. Will you kindly intimate IT rules? In this regard whether the bank has deducted TDS correctly? In case my version is correct, how the bank will credit the refund?







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Job loss: Govt offers help to India Inc

New Delhi, February 8
With the employment situation getting worse in the backdrop of global economic meltdown, the government has said it was ready to take “any measures” to help Indian industries prevent further loss of jobs.

“Export market is affected to some extent as the purchasing power of industries has dropped. But we are working with them to ensure that production lines are kept running so that more jobs are not lost,” Union Minister for Labour and Employment Oscar Fernandes said on the sidelines of a function here.

Fernandes’s comment came after he was asked about the steps the government was contemplating to take following one of its own report that around half a million people lost their jobs between October and December 2008.

“We are ready to offer any help, be it in the form of tax relief, providing credit support or anything else to help industries support jobs of people. To tide over the crisis, the industry should also take fresh initiatives to explore demands in newer markets,” Fernandes added.

Asked if more stimulus packages could be expected, the minister expressed optimism over certain measures that the government had already taken to contain the crisis.

“The auto industry that has seen a drop in production will pick up soon. Prevailing prices of fuel and steel have already been lowered to provide them a booster,” Fernandes said.

“We are hopeful that with fall in steel prices, even construction activities will pick up within a year,” he added.

A Labour ministry study had found that capacity utilisation of exporting units had come down by 7.05 per cent and 5.68 per cent in the automobiles and metal sectors, respectively, during October to December 2008.

Earlier, while addressing a seminar organised by the Quality Council of India (QCI), Fernandes hailed the organisation for taking up the responsibility of training more than 6,000 Industrial Training Institute teachers with the knowledge to handle the latest tools.

“Quality of education has to improve and you (QCI) can strengthen the government’s approach and take it to the right direction as skill upgradation will help our working force tide over the current crisis,” the minister said.

He also highlighted that extending the tenure of unemployment allowance from three months salary paid over six months to six months salary paid over a year would also help tide over the slowdown crisis. — PTI

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Tata Motors to hire 1,650 workers

New Delhi, February 8
Indicating that some recovery is under way, the country’s largest commercial vehicles maker, Tata Motors, is hiring over 1,650 temporary workers for its Jamshedpur plant, after temporarily stopping operations several times at the unit over the past few months.

The plant, where the company mainly makes heavy-duty commercial vehicles, had last year “disengaged” over 700 temporary workers as production fell due to a severe sales slump.

“From the beginning of February we have hired over 1,650 temporary workers for our Jamshedpur plant,” a company spokesperson said.

Asked if production has increased at the plant, he said: “The plant is also functioning normally.” The hiring of temporary workers comes on the heels of Tata Motors recording healthy commercial vehicles sales in January at 17,373 units, highest in three months. This was, however, 43 per cent down compared to the same month last year, which was at 30,530 units.

The company's Jamshedpur plant had undergone three temporary block closures on November 6-8, November 25-29 and December 8-13 last year. — PTI

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Slump in FDI flow

New Delhi, February 8
India received just $1 billion foreign direct investment in November as fund flow turned to a trickle — making the task of matching last year’s receipts a challenge, much less achieve this year’s $35 billion goal.

The FDI inflows of $19.7 billion between April- November have made it amply clear that the current year’s target is far too ambitious to be achieved, given the recession in the US and several other developed economies - the source of cross-border investment.

After maintaining robust inflows till September — with a monthly range of $2.5-3 billion — FDI in October slipped to $1.4 billion and further to $1.08 billion in November, according to official figures.

While the foreign investment, other than the stock route remained lacklustre in the comparable period last year as well, it came like flash floods — $10 billion — in the last two months of the fiscal 2007-08. — PTI

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UBS set to declare historic loss

Zurich, February 8
Switzerland’s largest bank, UBS, is expected to announce the biggest loss in the country’s history when it releases Tuesday its results for 2008, a year that saw the national icon tarnished by the sub-prime crisis.

But if there is a silver lining for the bank, which has been the target of a huge state rescue package, it lies in the fact that analysts say UBS has now hit bottom after its stock price fell 82 per cent since the summer of 2007.

For that reason, the loss of nearly 20 billion Swiss francs ($17.2 billion) the bank is expected to announce for 2008 on Tuesday should not surprise markets, analysts say.

The numbers expected to be unveiled Tuesday are staggering, reflecting the fact that UBS was one of the banks hardest hit by the US sub-prime loan crisis. — AFP 

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Satyam Saga
Raju to be part of ISB curriculum
Suresh Dharur/Tribune News Service

Hyderabad, February 8
After entering the crime records by scripting corporate India’s biggest fraud, former chairman of Satyam Computers B Ramalinga Raju is set to become part of the curriculum of Indian School of Business (ISB), an internationally renowned management institution here. Ironically, Raju was once part of the 30-member governing council of ISB, ranked 15 among global business schools.

The life and times of Raju and the issues of corporate governance that his disgraceful exit has raised will be a case study for ISB students from the next academic year.

“We will be studying the case of Raju focusing on what really went wrong for the IT czar, but we will confine ourselves to a strictly academic work,” associate dean of academic programmes at ISB K Ramachandran said.

“The case study will not only focus on what went wrong in Satyam and allied group of companies run by Raju’s sons and relatives but will also be studied from the point of view of family business,’’ he said. Satyam Group of Companies, floated by Raju and his family, offers a unique case study as it is both a corporate entity and a family-run business at the same time.

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PNB aims at workforce rationalisation

New Delhi, February 8
In step with global banking trends, the country’s second-largest state-owned lender, Punjab National Bank, is expected to rationalise its workforce and reduce its staff strength by 28,000 in the next six years from 58,000 now.

“My long-term goal is that the bank must be run by 30,000 people by 2015,” Punjab National Bank chairman and managing director KC Chakrabarty said.

“We don’t have any exit policy (and) we don't want anybody to leave with an exit package. These people (about 28,000) would retire in natural course,” he said.

The workforce reduction, however, will be side by side with the induction of personnel with specialised skills to improve operational efficiency.

“We are recruiting about 2,000 people (this) fiscal... I need specific types of skill ... people for credit, treasury, corporate communications and marketing,” he said.

Chakrabarty said the bank would recruit more next year to cater to the growing business and also to make up for the staff who would be retiring. — PTI

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Warner Bros to outsource jobs to India

New Delhi, February 8
In a move that could ruffle a few feathers in the Barack Obama administration, American entertainment giant Warner Bros has said it would be outsourcing jobs to India.

It is believed that about 200 positions are to be outsourced to India and Poland by Warner Bros, which will slash as many as 10 per cent of its 8,000-strong workforce in the coming days.

“While no final decision have been made internationally, the company expects the layoffs, elimination of open positions and outsourcing to affect nearly 800 positions worldwide,” a Warner Bros official said.

About 200 open positions and 300 outsourced jobs would be affected as part of the reduction, while another 300 employees would be laid-off, the official said, adding that jobs would be outsourced to India. — PTI

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Tax Advice
Form 15H is for senior citizens only
by S.C. Vasudeva

Q. Axis Bank deducted TDS on September 30, 2008, from FDR opened on April 2, 2008, with maturity date after more than a year. I think TDS was deductible only on its maturity or earlier encashment or during March 2009 and that, too, if Form 15G/H is not submitted. The bank has taken a plea that interest as commuted quarterly and tax was also deducted whenever tax is added on quarterly commutation. The bank says other bank also deduct TDS whenever interest is commuted and all banks have separate TDS instructions. Will you kindly intimate IT rules? In this regard whether the bank has deducted TDS correctly? In case my version is correct, how the bank will credit the refund?

— Amarjit Kaur, Faridkot

A. In accordance with the provisions of Section 194A of the Act, the tax is required to be deducted in respect of interest income as and when the amount of interest is credited to the account of the payee. In case the credit is afforded quarterly, the bank will have to deduct tax at the time of credit of such interest to the account of the payee. Form 15G can be filed by a taxpayer only if the income on which tax is deductible is below the maximum amount not chargeable to tax. Form 15H is applicable in case of senior citizens only. The issue raised by you with regard to refund of tax by the bank would not arise.

Central Board of Direct Taxes

Q. I filed my return electronically on October 29, 2007, (assessment year 2007-08). I am in a partnership firm having audit. Now IT officials are demanding Form 16A, challans and hard copy of ITR Form 5 to issue refund. First I gave all the information regarding Forms 16A electronically. Now, I have to do double labour. Kindly let me know to whom can I complain about this? Is there any contact number of the Central Board of Direct Taxes (CBDT)?

Can I file public interest litigation in the Supreme Court on behalf of other advocates because all advocates are facing lot of difficulties due to this?

— Sam Ahuja

A. You have all the right to file public interest litigation with regard to an issue, which has a national importance. In case you feel that e-filing of returns has not served its purpose and is causing harassment to the taxpayers, you may take up the matter with the court. The office of the CBDT is situated in North Block, New Delhi. Any grievance should be marked to the chairman, Central Board of Direct Taxes, North Block, New Delhi.

Arrears of salary

Q. I am a govt employee. My gross salary for the financial year 2008-09 is expected around Rs 3.5 lakh that includes the 6th CPC Arrear of Rs 56,580 from January 1, 2006, to September 2008. I wanted to know:

Can I show this arrear over the previous year in my revised IT returns for the financial years 2005-06, 2006-07 and 2007-08?

a) How can I use Section 89 to save tax on this arrear?

b) Can I save this arrear in my previous years Savings after depositing in PPF etc? Please suggest me on the following points in order to save tax on the arrear.

— Yogesh Sharma

A. Your queries are replied hereunder:

a) It would not be possible for you to revise the return for the financial year 2005-06 as the same could have been revised by March 31, 2008. Similarly, the return for financial year 2006-07 can be revised up to March 31, 2009. You may be able to revise your return for financial year 2007-08 that can be revised up to March 31, 2010.

b) You can seek the relief under Section 89 of the Act by making an application to the assessing officer in Form 10E.

c) You can utilise the amount of Rs 56,580 by investing the same in approved savings schemes so as to claim the maximum deduction allowable under Section 80C for assessment year 2009-10. It may be added that the deposit of the amount will have to be made before March 31, 2009.

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