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India to seek addl $5.2b from World Bank
London, April 4
As a contra-cyclical meaure, India proposes to seek an additional assistance of $5.2 billion from the World Bank for recapitalisation of state-owned commercial banks and infrastructure projects. India, at present, receives $3.2 billion annually from the World Bank.

March exports to remain in negative zone: Pillai
New Delhi, April 4
India's exports are estimated to have dropped between 14 per cent and 20 per cent in March, 2009 from the year-ago level, as demand for merchandise slumped in the world's major economies that are battling recession.

Maruti to launch Ritz by mid-May
New Delhi, April 4
Country’s largest car manufacturer Maruti Suzuki India Ltd (MSIL) is all set to launch its sixth global car, Ritz, in mid-May.

‘New Satyam owner by April 13’
Mumbai, April 4
The Satyam board has extended the final date for submission of bids for acquiring up to 51 per cent stake in the company to April 13 and expects to announce the name of the winner on the same evening, member of the government-appointed board Deepak Parekh said.

Aviation Notes
Air India offers cheaper tickets to Chicago, NY

The merger of two national airlines has failed. The hearts of the two carriers have not blended. Both factions claim that the merger has caused insurmountable problems. 


Bollywood actor Ranbir Kapoor poses with Panasonic television in New Delhi on Saturday. Panasonic has roped in Ranbir as brand ambassador for its colour TV, Viera LCDs Plasma TV and home theatre range of products
Bollywood actor Ranbir Kapoor poses with Panasonic television in New Delhi on Saturday. Panasonic has roped in Ranbir as brand ambassador for its colour TV, Viera LCDs Plasma TV and home theatre range of products. Tribune photo: Manas Ranjan Bhui


EARLIER STORIES



Investor Guidance
HUF can’t make gift to members

Q: When my grandfather expired, his house was sold and the sale value and his investments in shares were divided amongst his heirs. I put my share in hotchpotch of my HUF and started submitting separate tax return for the same. At that time, my family consisted of myself, my wife, son & daughter.






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India to seek addl $5.2b from World Bank
Ashok Tuteja
Tribune News Service

London, April 4
As a contra-cyclical meaure, India proposes to seek an additional assistance of $5.2 billion from the World Bank for recapitalisation of state-owned commercial banks and infrastructure projects. India, at present, receives $3.2 billion annually from the World Bank.

Senior officials, who accompanied Prime Minister Manmohan Singh on his visit here for the G-20 summit, said India also plans to increase its share in the quotas of multilateral development banks like the International Monetary Fund and Asian Development Bank after major stakeholders in these institutions bring forward the issue of quota review and expanding in accordance with current realities that will give proper representation to the emerging economies.

However, there is no proposal to commit any additional resources towards the overall fiscal stimulus of $1.1 trillion announced by the G-20 summit. ''We have to husband our own foreign exchange reserves...we don't wish to make any grand announcement,'' the officials said when asked to comment on China committing $40 billion to the stimulus.

The officials were upbeat that the G-20 countries agreed to expand the resources of the IMF and ADB and to also bring forward the quota review in the IMF.

The Indian side is also conscious of the fact that such a review was not going to happen overnight but was sure that it cannot be postponed for long.

At the G-20 summit, the Indian Prime Minister was much in demand as the world' top leaders sought his views on how the world economy could be brought out in the unprecedented crisis. Quite a few suggestions made by Manmohan Singh have found their reflection in the communqiue adopted by the summit leaders. He was also assured that developing countries like India will have a higher voting right in institutions such as the IMF and the World Bank.

The leaders agreed to another major Indian demand by deciding to sell IMF gold reserves to raise $6 billion that will go toward helping out the world's poorest countries with cheap loans over the next two to three years.

On the issue of tax havens, which the G-20 has threatened to "name and shame", the officials were happy that the summit decided to crack down on non-cooperative jurisdictions and asserted that the countries should cooperate.

They said the entry of India into fora like Financial Stability Forum (FSF) and the Basle Committee was a good sign for the countries coming up the economic ladder.

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March exports to remain in negative zone: Pillai

New Delhi, April 4
India's exports are estimated to have dropped between 14 per cent and 20 per cent in March, 2009 from the year-ago level, as demand for merchandise slumped in the world's major economies that are battling recession.

Exports are estimated to have dropped in March, Commerce Secretary G K Pillai said today.

"I expect that in March exports would be about $12-14 billion," he said, adding for the fiscal ended March 2009, the total exports would be $168-170 billion. Up to February, overseas trade aggregated to $156.59 billion.

This will be the sixth straight month of negative growth.

Thanks to an impressive growth of over 30 per cent in the first half of the fiscal 2008-09, the country's annual exports are expected to end on a positive note. However, the growth would be merely 3-4 per cent over fiscal 2007-08. The March data is due to be released on May 1.

The recession in the developed markets, including the US and Europe, started eating into India's exports since October, 2008, when shipments fell by 12.1 per cent for the first time in five years.

The Federation of Indian Export Organisations (FIEO) has estimated a job loss of 10 million in the export manufacturing units.

The Commerce Secretary was talking to reporters on the sidelines of an Indo-American Chamber of Commerce meeting here.

While exports grew by 18 per cent in rupee terms in the last fiscal, the expansion was largely because of about 20 per cent depreciation in the value of the local currency against the US dollar that accounts for bulk of the global trade. — PTI 

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Maruti to launch Ritz by mid-May
Tribune News Service

New Delhi, April 4
Country’s largest car manufacturer Maruti Suzuki India Ltd (MSIL) is all set to launch its sixth global car, Ritz, in mid-May.

The seventh offering in the A-2 segment from the Maruti stable will come with a 1.2-litre KB series petrol and 1.3-litre multijet diesel engine simultaneously.

Officials at MSIL are upbeat about the launch which would be on the successful Splash platform. It is being named Ritz in India due to name registration problems.

The premium compact Ritz will be positioned between the A-star and the Swift, and is being launched with the idea of countering Hyundai’s i10 and i20, Skoda’s Fabia, Ford’s Fusion, Fiat’s Palio and Tata Motors’ Indica Vista. Officials are hopeful that like the A-Star and Swift, Ritz would also be a big success and would be able to wean away customers from i-10.

Although officials were tightlipped about the price, but reports suggested that Ritz would be priced around Rs 5 lakh, which is just below the Swift’s price tag. It will be shorter than the Swift (by 30 mm), but will be spacious due to high-roof structure.

They were also confident that the Ritz, known as Splash in Europe and other developed markets, will be able to coexist with WagonR, just as the newly launched A-Star is thriving with the Alto.

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‘New Satyam owner by April 13’

Mumbai, April 4
The Satyam board has extended the final date for submission of bids for acquiring up to 51 per cent stake in the company to April 13 and expects to announce the name of the winner on the same evening, member of the government-appointed board Deepak Parekh said.

"We met bidders yesterday and they requested for an extension of the date. They wanted more information about the company and hence the extension," Parekh told PTI here.

The board will be supplying them with the information "today or tomorrow," Parekh said adding that "the name of the winner will be announced by April 13." Satyam's government-appointed board had earlier fixed April 9 as the deadline for interested parties to submit their bids.

Satyam's board members met with potential bidders yesterday at a meeting in the metropolis which was also attended by the company's newly-appointed CEO A S Murty and investment bankers Goldman Sachs and Avendus. — PTI 

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Aviation Notes
Air India offers cheaper tickets to Chicago, NY
by K.R. Wadhwaney

The merger of two national airlines has failed. The hearts of the two carriers have not blended. Both factions claim that the merger has caused insurmountable problems. Both groups are complaining and protesting against the civil aviation ministry and minister Praful Patel.

The Air India staff claim that there has been mis-match in promotional and career-growth structures, while Indian Airlines staff have been resenting for non-payment of dues. In recent months, IA has had two protest marches from Jantar Mantar.

Air India's middle management cadre, about 850, have started a signature campaign alleging large-scale discrepancies. According to AI, 'post-merger', they have been at disadvantage. In AI only graduates are allowed to apply, while in Indian Airlines, promotional avenues are open to even those who are merely matriculates. "Why should there be different rules when National Aviation Company is one?" they asked.

Whatever may be the internal situation and regardless of misunderstanding persisting in two groups, Air India has unveiled cheaper flights to Chicago and New York. "The fares will be about 30 per cent cheaper than offered by several other international airlines", according to AI officials. The national carrier has deployed new Boeing 777-300 on these two lucrative routes. There will be only four first class seats, 35 in business class and 303 in the economy class.

Air India's move has caused concern to several other international carriers as instability in fare structure exists. This is because fuel prices keep changing. The overall picture in the Indian aviation sector is far from rosy. The shifting of the Indian Premier League (IPL) from India to South Africa has also had a shadow on the tourist traffic. "The less tourists visiting this country means flights flying light", said airline officials.

The Boeing's launch of research and technology centre at Bangalore will provide the much-needed boost to the aviation sector, which continues to languish for several reasons. The Boeing's centre will be only third in the world of aviation. The other two are situated in Australia and Europe. Many Indians are expected to work along with experts on the rolls of the Boeing.

Boeing will also sell 100 aircraft to India, bulk of which will be to the NAC. Air India officials are optimistic that new aircraft on several new routes will be revenue earning flights. "We will continue to expand as we keep on getting new aircraft" said official of the airline.

The analysts say that the desi Air Force I is not as sturdy and glamorous as videshi Air Force I (United States) in many aspects. The US outfit, 747, includes among several other highly sophisticated gadgets medical facility, work-out room kitchen, bedroom and office. In comparison, Indian aircraft lacks in space and, according to those who had taken off with the President Pratibha Patil's flight on Wendesday, April 1, the flying oval caused disappointment. The interior décor was far from impressive and colourful. The VVIPs now travel in much more comfort and happiness with the induction of these aircraft.

The concern, however, persists in the aviation sector. The ministry is yet to announce whether civil operations will stop or will continue to operate along with VVIP movement.

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Investor Guidance
HUF can’t make gift to members
by A.N. Shanbhag

Q: When my grandfather expired, his house was sold and the sale value and his investments in shares were divided amongst his heirs. I put my share in hotchpotch of my HUF and started submitting separate tax return for the same. At that time, my family consisted of myself, my wife, son & daughter.

Am I correct in presuming that myself, my wife and my son were the coparceners, but not my daughter?

Now both of my children are married & my son has a son (my grandson). Would my daughter-in-law and my grandson be additional coparceners?

You have mentioned about gifts "received" by an individual or by HUF. Can HUF give the gifts?

Can my HUF give some shares, debentures or cash as gift either to my daughter who is married by now or to my wife? What would be the tax implications to either of them or to HUF? What could be value of such gift every year that I can give to either of them without tax implications?

Who are the relatives of HUF?

—V. B. Gadkari

A : 1. HUF consists of coparceners i.e., the sons, grandsons and great-grandsons of the holder of the joint property for the time being - three generations next to the holder in unbroken male descent. Female members are not coparceners and have no right to demand partition. The wives and unmarried daughters of male members are entitled to maintenance out of their family property. The senior most member of the family usually manages the affairs of the family and is known as a Karta. However, the wife of a Karta has an equal share with all the coparceners.

Your daughter has ceased to be a member of HUF from the date of her marriage.

2. An HUF cannot make a gift to one of its members. But gifts out of the HUF property may be made by the karta for certain approved purposes such as performing indispensable acts of duty, or for satisfying legal obligations or through affection, support of the family, relief from distress, etc., within reasonable limits. Thus, a father may gift an ancestral movable properties of the joint family within reasonable limits, without the consent of his sons for such purposes.

3. The Karta of HUF can give a gift from the HUF corpus to any outsider up to a reasonable extent as long as such a gift is not harmful to the estate of the HUF.

4. Where any sum of money exceeding Rs. 50,000 received without consideration by an individual or HUF from any person, the whole of such sum is chargeable to income tax. However, such gifts received from a relative are not chargeable.

Extension of PPF a/c

Q: My PPF account matured in 2007. As per rules I could have given a request for renewal for up to a year. Due to oversight this has been missed. The bank now says the account cannot be continued. I would like to let the funds remain in the existing account and allow it to earn tax free interest. I cannot make any further contributions in that account.

Can I open a new PPF account for fresh contributions? Can an individual have only one PPF account. Can my current? PPF account be excluded from that since technically it has matured? I understand that withdrawal is an option and not mandatory.

— Deven Doshi

A : As per Sec. 9(3) of PPF Scheme, at its maturity, the account can be continued for a block of 5 years. This facility is available for any number of blocks on expiry of each of the extended period. The continuation can be with or without contribution. Once an account is continued without contributions for one year, the subscriber cannot change over to with-contributions extension. [Notification F.3(6)-PD/86 dt 20.8.86].

A subscriber, continuing his account with fresh subscriptions, can withdraw up to 60% of the balance to his credit at the commencement of each extended period in one or more installments, but only one per year. On the other hand, in the case of account extended without contribution, withdrawals can be effected in installments, not exceeding one in a year. The balance will continue to earn interest till it is completely withdrawn.

No new account can be opened if the old one is in extended mode either with or without contributions .

Form-H is to be used to declare the intention of continuing the account with subscription for each extended period. It should be filed before the first contribution is made for the first year. In its absence, the account will be treated as without-subscription extension. Fresh contributions made to such accounts will enjoy neither the deduction u/s 80C nor the interest.

The authors may be contacted at wonderlandconsultants@yahoo.com

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BRIEFLY

Vikram Chatwal Hotels to invest Rs 5,000 cr in India
Kochi:
Looking aggressively at the Indian market for expansion, the Vikram Chatwal Hotels, a division of Hampshire Hotels and Resorts, plans to open "Dream brand hotels" in various cities in the country, including Bangalore, Mumbai and New Delhi with a Rs 5,000-crore investment. About Rs 1,000 crore has already been invested in the country, which will go up to Rs 5,000 crore, Hampshire Hotels and Resorts Chairman and CEO Sant Singh Chatwal told reporters here. — PTI
A model shows a blue diamond from the Cullinan mine weighing 7.03 carats that will be auctioned in Geneva on April 8 with a pre-sale esimate of $5.8-8.5 million, at a preview of Sotheby's Spring Sales in Hong Kong
A model shows a blue diamond from the Cullinan mine weighing 7.03 carats that will be auctioned in Geneva on April 8 with a pre-sale esimate of $5.8-8.5 million, at a preview of Sotheby's Spring Sales in Hong Kong on Saturday. — AFP 

RIL shareholders vote on RIL-RPL merger
Mumbai:
Shareholders of Reliance Industries met here on Saturday in an extra-ordinary general meeting (EGM) to vote on the merger of its subsidiary Reliance Petroleum with the company. The result of the voting will be announced on Monday, an RIL spokesperson said. Equity shareholders and secured and unsecured creditors of RIL took part in the meeting and voted on the merger proposal, the official said. — PTI

Air India opens new hub at Frankfurt
Frankfurt
: Air India has officially opened its European hub at the Frankfurt International Airport from where it will operate its West-bound flights. The Deputy Chairman of the Frankfurt International Airport Stefan Schulte has said Air India's chances of joining the Star Alliance, the consortium of 21 global carriers, have been improved by the opening of the Frankfurt hub. — PTI

Hindustan Sanitaryware
New Delhi:
Hindustan Sanitaryware & Industries Ltd has changed its name to ‘HSIL Limited’ with immediate effect. The change will have no effect on the management, financial resources, investing focus, business operations and manpower. — TNS

Gold falls further
New Delhi:
Gold prices fell further in the national capital on Saturday by Rs 140 to Rs 14,760 per 10 gram on slump in demand amid declining rates in the global markets and hopes of economic recovery worldwide. However, silver recovered by Rs 100 to Rs 21,400 per kg. — PTI

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