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THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS
B U S I N E S S

Govt asked to set up real estate regulator
New Delhi, March 15
A high-level task force has recommended setting up of a “real estate regulator” and a dedicated institutional framework to look into the issue of providing affordable houses to the people.

UN in talks with Satyam for contract termination
New Delhi, March 15
The United Nations, which in January suspended fraud-hit Satyam Computer from its vendor database, is now likely to terminate its contract awarded on a talent management project with the IT company.

RIL may sell or lease out fuel pumps to IOC
Mumbai, March 15
Reliance Industries (RIL) may propose to sell or lease out its 1,432 petrol pumps to IndianOil Corporation even as it will reopen shortly the outlets that were shut a year ago.

Tax Advice
Grant to riot victims not taxable
Q As a 1984 riots’ victim, I have received Rs 2 lakh as rehabilitation grant from the Centre. Please let me know whether this amount is taxable or not.



EARLIER STORIES




A picture shows a detail of the pearl carpet of Baroda displayed at the Ritz-Carlton hotel in Doha on Saturday. The carpet is made of rubies, sapphires, diamonds, and pearls and will be auctioned off at Sotheby’s Doha branch on March 19 with a starting bid of $5 million
A picture shows a detail of the pearl carpet of Baroda displayed at the Ritz-Carlton hotel in Doha on Saturday. The carpet is made of rubies, sapphires, diamonds, and pearls and will be auctioned off at Sotheby’s Doha branch on March 19 with a starting bid of $5 million. — AFP

Market Update
Markets not out of the woods yet
Tracking strong gains across the globe, key Indian stock indices advanced in a truncated trading week. The lowest rate of inflation in six-and-a-half year’s (2.34 per cent) also aided the recovery. The Sensex surged 5.2 per cent to close at 8,757. The NSE Nifty climed 3.8 per cent to close the week at 2,719, shrugging off negative IIP (Index of Industrial Production) data for January at -0.5 per cent and continuous selling by the FIIs. Despite the last week’s rally, we continue to hold the view that market is not out of the woods. Apart from the USA, the economic news flow from the other developed part of the world, such as Europe and Japan, has also worsened significantly in the past few weeks. 

 





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Govt asked to set up real estate regulator

New Delhi, March 15
A high-level task force has recommended setting up of a “real estate regulator” and a dedicated institutional framework to look into the issue of providing affordable houses to the people.

The regulator could serve as a single window for overseeing and monitoring the affordable housing agenda and promote policy reforms like stamp duty and registration and protect consumer from real estate fraud, the task force, constituted by the Ministry of Housing and Urban Poverty Alleviation, said.

Besides, it can coordinate digitisation of land records, the task force underlined.

The recommendation assumes significance as high price has put housing projects in metros and emerging towns beyond the reach of the common man.

A couple of months ago, Housing Development Minister Jaipal Reddy had asked developers to exploit the slump in the market with affordable housing schemes, but the appeal had little response.

“The fact of the matter is that today most of the developers are going for high-end projects that sell at a premium in the market. As a result, buyers with limited resources are left with little options,” a ministry official said.

The high stamp duty and registration remains another area of concern, the official said.

The high-level task force has suggested preparing a model bill for establishment of such a regulator.

However, till the legislative process is complete, it has suggested setting up of ombudsman type bodies at the state level as an interim measure, a member of the task force said.

Taking note of the fact that the country does not have a coherent institutional framework to promote affordable housing, the task force has also suggested a dedicated framework for the purpose.

It should be structured as a partnership institution that would harness private sector creativity and energy and be well funded, the task force said.

The funding can be done partly by the government but in a manner that enables the use of market-oriented funding to ensure the sustainability of the housing effort for decades to come, it said.

The task force was headed by chairman of Housing Development Finance Corporation Limited Deepak Parekh and comprised above 10 members from the field of finance, planning, real estate, banking and academics. — PTI

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UN in talks with Satyam for contract termination

New Delhi, March 15
The United Nations, which in January suspended fraud-hit Satyam Computer from its vendor database, is now likely to terminate its contract awarded on a talent management project with the IT company.

“Satyam continues to be suspended and Satyam and the UN are in discussion on a likely termination for convenience for the current contract,” Paul Buades, director at the United Nations Procurement Division said from New York.

The software exporter was selected by the UN for a talent management project.

When asked about how many contracts does Satyam have with the UN, Buades said the “UN Secretariat (procurement division) has only one project.” The UN has also asked one of its arms International Computing Centre (ICC) to replace the firm for its projects.

“The UN Secretariat has several projects under way with ICC that involve Satyam. Satyam is engaged as a sub-contractor of ICC.

“The Secretariat does not have any direct contract with Satyam for these projects. In light of recent developments concerning Satyam, we asked ICC to find a replacement for Satyam as soon as possible,” Buades said.

Satyam is engaged as a sub-contractor with ICC - which provides a wide range of Information and communication technology services, on a cost recovery basis, to its users worldwide.

“Satyam has been suspended from the UN Secretariat vendor database. The information has been communicated to the UN procurement system and the UN Global Marketplace,” it had said. — PTI

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RIL may sell or lease out fuel pumps to IOC

Mumbai, March 15
Reliance Industries (RIL) may propose to sell or lease out its 1,432 petrol pumps to IndianOil Corporation even as it will reopen shortly the outlets that were shut a year ago.

Reliance may propose to transfer its petrol stations into a joint venture company run by the state firm, a source said. “The company had invested about Rs 5,000 crore in setting up the retail network and it does not make sense for it to keep them idle,” he said.

Partnership with IOC would help the company overcome the handicap of not being able to use fuel from its two refineries at Jamnagar in Gujarat because they have been converted into only-for-exports units. Also, it would enable the pumps to avail of subsidy if the government doesn’t free fuel pricing and international oil prices bounce back.

But IOC has not yet taken a view on the fillers sent by Reliance, the source said.

“It has started removing the protective gear put around dispensing units when the petrol pumps were shut in March last year. From March 16, it will start preparation to sell fuel from some of these,” a source said. However, an official said Reliance has not made any decision on reopening of the petrol pumps just yet. — PTI

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Tax Advice
Grant to riot victims not taxable
by S.C. Vasudeva

Q As a 1984 riots’ victim, I have received Rs 2 lakh as rehabilitation grant from the Centre. Please let me know whether this amount is taxable or not.

— CJ Singh, Mohali

A The amount received as rehabilitation grant from the Central Government by you should be exempt from tax under Section 10(10BC) of the Act which provides for the exemption of any amount received from the Central government or the state government or local authority by an individual or his legal heir by way of compensation on account of any disaster. The term ‘disaster’ as defined by the Disaster Management Act, 2005, covers a grave occurrence in any area arising from natural or man-made causes. In my opinion the amount of grant received by you should be exempt from tax under the aforesaid section.

Interest on FDR

Q Please advise whether accrued interest earned on FDR made under tax saving scheme with the bank, which is added in the first instance in the total income, is allowable or not for deduction, thereafter, under Section 80C of the IT Act, within the overall limit of Rs 1 lakh.

— Sudarshan Kumari, Batala

A The amount of term deposit for a period of five years or more is allowable as a deduction from the total income and is covered within the overall limit of Rs 1 lakh. The interest earned on such fixed deposit would be taxable and no deduction is allowable under Section 80C of the Income-tax Act, 1961, (the Act) in respect of such an interest.

Tax limit

Q I am a working woman. Interest from salary and arrears for financial year 2008-09 (assessment year 2009-10) is as given below.

Please calculate the income tax. Salary=2,20,200I

nterest=68,0003,38,200

Paid u/s 80C=1,00,0002,38,000

Exemption for women=1,80,000-58,200.

— Nidhi Arora, Panchkula

A The maximum amount on which tax is not chargeable in the case of women below the age of 65 years is Rs 1,80,000. The tax payable after taking into account the aforesaid exemption limit would work out at Rs 6,000. It may be added that you are required to file your return by July 31, 2009, for the assessment year 2009-10.

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Market Update
Markets not out of the woods yet
by Lalit Batra

Tracking strong gains across the globe, key Indian stock indices advanced in a truncated trading week. The lowest rate of inflation in six-and-a-half year’s (2.34 per cent) also aided the recovery. The Sensex surged 5.2 per cent to close at 8,757. The NSE Nifty climed 3.8 per cent to close the week at 2,719, shrugging off negative IIP (Index of Industrial Production) data for January at -0.5 per cent and continuous selling by the FIIs.

Despite the last week’s rally, we continue to hold the view that market is not out of the woods. Apart from the USA, the economic news flow from the other developed part of the world, such as Europe and Japan, has also worsened significantly in the past few weeks. Moreover, even the USA economic realities have overshadowed the short-lived euphoria that was created by rhetoric of the Obama administration.

The Indian equity markets have also witnessed a sell-off in line with the meltdown in the global markets. Apart from the global concerns, there are India-specific issues that have spooked the markets. First, the higher than anticipated consolidated fiscal deficit of 11.4 per cent for the current fiscal 2008-09 and its fall-out on the economy (eg a possible review of the country’s sovereign rating). Second, the outcome of the forthcoming general elections remains uncertain with the growing possibility of a coalition government heavily dependent on the regional and smaller parties. Third, the recent incidents in neighbouring countries like Pakistan, Sri Lanka and Bangladesh have added a new dimension of regional instability as a potential risk for the foreign investors.

Given the growing concerns (global and domestic) and absence of any positive triggers till the new government comes in place by June, the risk of a break-down from the trading range of the post four months has increased substantially. However, silver lining is that such an eventuality could be a once in a lifetime opportunity for building a long-term portfolio. Moreover, the markets would continue to provide strong trading rallies, like the one witnessed last week, despite the downward bias.

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BRIEFLY

AIG to pay $165 m in  bonuses: Report
NEW YORK
: The American International Group plans to pay about $165 million in bonuses even though the troubled insurance giant received a taxpayer bailout of over $170 billion, says a media report. “The AIG, which has received more than $170 billion in taxpayer bailout money from the Treasury and Federal Reserve, plans to pay about $165 million in bonuses by Sunday to executives in the same business unit that brought the company to the brink of collapse last year,” the New York Times said. — PTI

DSE to resume trading
NEW DELHI
: The Delhi Stock Exchange will resume trading in June, nearly six years after activities at the once bustling bourse came to a halt because of the turnover there becoming almost negligible. “We are targeting June 25, the day the stock exchange came into existence six decades ago, for restarting our trading platform as it is a symbolic date for us,” DSE executive director said. — PTI

ATF prices up
NEW DELHI
: The state-owned oil firms on Sunday raised jet fuel or ATF prices marginally by Rs 158 per kilolitre on an average. Aviation turbine fuel will cost Rs 27,275 per kl in Delhi against Rs 27,106 per kl, an IOC official said. The increase in jet fuel prices announced today varied from airport to airport depending on local taxes and levies and an on average worked out to be Rs 158 per kl. — PTI

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