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Export oriented units get extension of I-T benefit

Duty entitlement passbook scheme to continue for another year

A slew of measures to pep up export of traditional industries hit by the rupee appreciation, major spurs to cut down transaction costs, procedural simplification, extension of the popular duty neutralisation DEPB (Duty Entitlement Pass Book) scheme till May 2009 and also a one-year extension beyond March 2009 in income-tax benefit to 100 per cent export units are outlined in the annual supplement to Foreign Trade policy.

Releasing the final year supplement to the FTA (2004-09) here on Friday, the Union Commerce and Industry Minister, Mr Kamal Nath, announced an export target of $200 billion for the current fiscal, against $155 billion export performance achieved in 2007-08.

He said the achievement fell short by $5 billion due to the effect of an appreciating rupee by more than 12 per cent against the dollar in 2007. If trade in services were added, India’s commercial engagement with the world would be $525 billion, he said.

In order to achieve the export target, Mr Nath announced tax refunds and interest subsidies to a spate of export segments that are labour-intensive in nature such as marine products, leather, textiles and handicrafts and 5 per cent additional duty credit for export of toys and sports goods.

Source and more details at: The Hindu Business Line

Addressing members of the Bharat Chamber of Commerce and Merchants Chamber, besides captains of industry, at an interactive session on ‘Direct Taxes: Policies and Prescriptions’, here on Monday, Mr R. Prasad, Chairman, Central Board of Direct Taxes (CBDT), Union Ministry of Finance, clarified that activities of Chambers of Commerce will not be brought under the tax net, under the new proviso to Section 2 (15) in the Union Budget.(As per the changes proposed in the Finance Bill with regard to direct tax provisions under Section 2(15) of the I-T Act, it is proposed that the concept of general public utility for a charitable purpose shall not apply if the job involved carrying on of “any activity in the nature of trade, commerce or business”.)  — March, 11th 2008

What will be cheaper

* Pharma goods excise duty cut to 8%
* Anti-Aids drug gets excise duty exemption
* Custom duty for phosphoric acid custom duty reduced to 5%
* Custom duty on some bulk drugs cut from 10% to 5%
* Custom duty on steel scrapped
* Custom duty on vitamin pre-mixes to lower from 30% to 20%
* Excise duty reduced from 16 to 8 per cent on water purification items.

What will cost more* Excise on packaged software to go up from 8% to 12%
* No excise duty on refrigerating equipments
* Duty on non filter cigarettes to be raised

The government on Friday proposed to increase service tax revenues by bringing in services companies like
1) stock and commodity exchanges,
2) asset management firms offering unit-linked insurance plan,
3) clearing houses
4) and customised software makers under the levy.

*Banking transaction tax to be removed
*Reduce central sales tax to 2%
*Increase in short term capital gains tax to 15%
*5-yr tax holiday for setting up hospitals in tier-II, tier III regions
*Excise duty of Rs 1.35/litre on unbranded petrol
*Excise duty of Rs 4.6/litre on unbranded diesel
*Commodities Transactions Tax to be introduced
*Securities Transaction Tax to be treated like deductible expenditure
*5-yr tax holiday to 2,3,4-star hotels in UNESCO’s heritage sites
*NO FBT on creche, employee sports, guest houses facilities
*No change in corporate income tax rate
*No change in corporate surcharge tax
*Duty on two wheelers reduced from 16 to 12 pc
*Tax slab for Rs 3-5 lakh is 25 pc
*Senior citizens’ exemption hiked from Rs 1,95,000 to 2,25,000
*Women exemption threshold hiked from Rs 1,45,000 to 1,80,000
*Tax exemption hiked from Rs 1,10,000 to Rs 1,50,000
*Duty on non filter cigarettes to be raised
*Excise duty slashed to 8% on water purification items
*Duty withdrawn on naptha for production of polymers
*Refigeration components to become cheaper
*Reduce excise duties on anti-AIDS drugs
*Tax-GDP ratio up at 12.5%
*Excise on paper and paper products reduced
*Excise duties on buses, chassis slashed
*Excise on small cars to 14%
*Excise on pharma goods slashed to 14%
*General CENVAT rate on all goods from 16% to 14%
*Customs duty on few bulk drugs cut to 5%
*Customs duties on crude sulphur reduced to 2%
*Exempt on duties on coral
*Duties on convergence products slashed to 5%
*Fully exempt duties on Set top boxes
*Reduce duties on steel melting scrap, aluminum scrap
*No change in peak rate of customs duties
*Revenue Deficit will be 1.4 % agt Budget Estimate of 1.5%
*Planning Commission to evaluate major schemes
*Sixth central pay commission to submit report by March 31, 2008
*Grant of Rs 50 cr to Natl Tiger Conservation Authority
*Rs 75 cr to ICCR for cultural development
*Defence allocation hiked by 10% to Rs 1,05,600 cr
*Rs 32,676 crore as subsidy to PDS
*Smart-card based PDS system in Haryana, Chandigarh
*Allocation of Rs 44 cr to 22 Sainik schools each
*Rs 75 cr to Agri Ministry for soil testing labs in 250 districts
*Rs 15,000 cr for non-profit body for skilled dev programme
*Launch a world-class skilled development programme
*PAN requirement for all securities transactions
*To start a forex derivative market
*More transparency in the derivative market
*Risk Capital Fund to be set up in SIDBI
*National Highway Dev programme gets Rs 12,966 cr
*Accelerated power development programmes to get Rs 8,000 cr
*Ultra mega power project at Tilana shortly
*Rs 12,956 Cr for NHDP
*Banks to be encouraged to embrace total financial inclusion
*Foreign invt up to $8 bn expected for oil block exploration
*Coal regulator to be set up
*17 lakh families of weavers under Health Insurance
*State data centres scheme approved and get Rs 275 cr
*1 lakh broadband-enabled common service centres in villages
*Enhance allocation of NHDP programme
*Rs 800 cr for power reforms
*Manufacturing growth rate to be taken to double digit
*RIDF corpus to be hiked to Rs 14,000 cr
*Total estimate of loans being waived is Rs 50,000 cr
*Implementation of debt waiver scheme to end by June 30
*Waiver amounts to 4% of total bank loans
*Rescheduled farm loans eligible for waiver
*Din in House over PC’s relief plans to farmers
*Marginal, small farmers to get full waiver on all loans
*500 soil testing labs to be set up in the country
*Scheme of debt waiver and debt relief for farmers
*Allocation for NRHM increased to Rs 12,050 cr
*National Horticulture Mission gets Rs 1,100 cr
*Weather-based crop insurance scheme to get Rs 50 cr
*Rs 20,000 cr for irrigation projects under AIPB
*Special grant of Rs 20 cr to Tea Research Association
*Rs 500 cr to be allocated for micro irrigation schemes
*More funds for cardamom, coffee growing
*Rashtriya Krishi Vikas Yojana to get Rs 2,80,000 cr
*53 minor irrigation programmes to be implemented
*Target of Rs 2.80 lakh cr for agri-credit in 2008-09
*Ministry of Woman and Child Dev gets Rs 7,200 cr
*24% increase in allocation for child development
*Rs 500 cr for development of border areas
*Rs 1,042 cr for anti-Polio drive
*Jawaharlal Nehru Urban Renewal Mission to get Rs 6,865cr
*Growth of agri-credit impressive
*Allocation for ICDS increased to Rs 6,300 cr
*Minority Affairs Ministry fund doubled to Rs 1,000 cr
*288 PSU bank branches in minority districts
*Rs 540 cr for development plan for minority districts
*Rs 500 cr for corpus fund to subsidise all women
*LIC to cover all women Self-help Groups linked to banks
*Rs 200 crore for potable water in schools
*Rs 12,050 cr for strengthening rural health services
*Sanitation programmes to get Rs 1200 cr
*More minority recruitments in central para-military forces
*ICDS allocation hiked to Rs 6,300 cr
*Rs 300 cr for desalination plant near Chennai
*Rs 75 cr for Rajiv Gandhi Natl Fellowship Prog
*Natl Handicap Development Corp to get Rs 9 cr
*Natl Minorities Development Corp to get Rs 75 cr
*Allocation for NE schemes up from 14,365 cr to 16,400 cr
*Rajiv Gandhi Drinking Water mission allocation hiked
*NREG scheme to be rolled out in 596 districts
*National Rural Health Mission allocation hiked by 15%
*Remuneration of Anganwadi helpers hiked to Rs 750
*Remuneration of Anganwadi workers hiked to Rs 1,500
*3 IIScs in Bhopal and Trivandrum
*National Programme for the Elderly to be set up
*Rs 30,000 health cover for every worker in unorganised sector
*2 schools of Planning and Architecture
*Secondary education Scheme Rs 4,554 crore
*Rs 100 cr to Ministry of Science and tech for Natl Knowledge Network
*All knowledge bodies to be connected via broadband
*Rs 85 crore to building a knowledge society
*Scholarships for science and research
*Education and Health allocation up 20%
*Service Sector to grow at 10.7%
*3 IITs in AP, Bihar and Rajasthan
*16 central universities to be set up
*Mid-day meal scheme extended to upper primary classes
*Budgetary allocation for mid-day meal scheme Rs 8,000
*Rs 10 cr for Nehru Kendras in 110 districts

Chidambaram announced major – and arguably populist - changes in the Income Tax slab. He said the threshold of exemption for all Income Tax assesses will be raised from Rs 1,10,000 to Rs 1,50,000, eliciting applause from the Parliamentarians. Personal income tax exemption slab for women will be at Rs 1.8 lakh

* Every income tax assessees to get relief of minimum of Rs 4,000.
* No change in rate of surcharge.
* New tax slabs will be: 10 per cent for 150,000 to 300,000, 20 per cent for 300,000 to * 500,000 and 30 per cent above 500,000.
* No change in corporate income tax.

Union Finance Minister P Chidambaram presented his fifth Budget in Parliament on Friday. Following are the highlights:

Highlights:

• NREGA scheme to be rolled out in all the 596 rural districts in the country in 2008-09.
• Jawaharlal Nehru Urban Renewal Mission to get Rs 6,865 crore this year against Rs 5,482 crore past year.
• Allocation for Rajiv Gandhi Drinking Water Mission to be increased to Rs 7,300 crore. Rs 200 crore for potable water in schools.
• Rs 300 crore to be set aside for desalination plant in Chennai for drinking water.
• Rs 500 crore for identifying urgent needs of development programmes of border areas like Arunachal Pradesh.
• SC, ST and minority students to continue to get special attention.
• Allocation for several schemes in North East raised from Rs 14,365 crore to Rs 16,400 crore.
• Rs 75 crore sanctioned for Rajiv Gandhi National Fellowship Programme for SC/ST students pursuing M.Phil.
• Rs 230 crore will be extended as additional equity to developmental organisations looking after the welfare of SC,
• ST, socially and economically backward classes and minorities.
• Allocation for Minority Affairs Ministry to be doubled from Rs 500 crore to Rs 1,000 crore.
• Rs 540 crore for multi-sectoral development plan for minority concentration districts.
• 288 public sector bank branches to be opened in districts having minority community concentration.
• Sarva Shiksha Abhiyan will be provided Rs 13,100 crore, Mid Day Meal scheme Rs 8,000 crore, Secondary education Scheme Rs 4,554 crore.
• 410 additional Kasturba Gandhi Vidyalaya to be set up in backward blocks.
• Navodaya Vidyalayas to be opened in 20 districts with special focus on regions having SC/ST concentration.
• Allocation of Rs 130 crore for this purpose. Rs.750 crore more to be given for merit scholarship to students up to 10th and 12th class.
• Mid day Meal scheme extended to upper primary level in 3479 schools. 16 central universities to be opened in 2008-09.
• Three IITs to be set up in Andhra Pradesh, Bihar and Rajasthan.
• Schools of architecture and planning in Bhopal and Vijaywada. More institutes of higher education to be opened.
• Rs 100 crore to be given to Information Technology Ministry to set up national knowledge centres.
• Allocation for NRHM increased to Rs 12,050 crore
• Rs 992 crore for national AIDS programme.
• A national programme for the elderly to be started at a cost of Rs. 400 crore.
• Rashtra Swasthya Beema Yojana to start from April one in Delhi and Haryana. Rs 30,000 for each family belonging to unorganised sector.
• Allocation for ICDS increased to Rs 6300 crore.
• Rs 85 crore sanctioned for scholarships to students pursuing science education.
• Indian Institutes of Science Education and Research to be set up at Bhopal and Thiruvananthapuram.
• Agriculture credit doubled in the first two years of the government to reach Rs.2.40 lakh crore by March 2008.
• Eleventh Plan started on a robust growth.
• Gross budgetary support to be raised to Rs 2,43,386 crore, an increase of more than Rs 38,000 crore from the current level.
• Allocation for Bharat Nirman to be raised to Rs 31,280 crore.
• Twenty per cent hike in education budget this year from Rs 28,674 crore to Rs 34,400 crore.
• GDP growth slows down to 8.4 per cent during quarter ended December 31, 2007 as compared to 9.1 per cent a year ago.
• Economy grew over eight per cent over 12 successive quarters since 2005, says Finance Minister P Chidambaram.
• Growth rate of agricultre extimated at 2.6 per cent during the current year.
• Services and manufacturing sectors expected to grow by 10.7 per cent and 9.4 per cent, says Chidambaram.
• Keeping inflation under check is one of the cornerstones of the Government’s policy.
• Rice production estimiated at 94.08 million tonnes, maize 16.78 mt, soyabean 9.45 mt and cotton 23.38 million bales.

Source & Courtesy: Rediff

February 29, 2008 11:45 IST

Changes in I-T slab.

NEW DELHI: The following are the highlights of the Railway Budget 2008-09, presented in the Lok Sabha Tuesday by Railway Minister Lalu Prasad:

Railways achieved 76 percent operating ratio

New profit recorded in 2007-08

Rs.492.50 billion invested in new projects

New profit of 21 percent recorded in 2007-08 for the first time

Operating ratio a favourable 76 percent

790 million tonnes of payload target achieved

Rs.492.50 billion invested in new projects

15,000 automated ticket machines in 2 years

More trains in peak season

Rajdhani and Shatabdi trains to have more modern coaches

Cash surplus in 2007-08 pegged at Rs.250 billion

New earnings of 21 percent in 2007-08

Rs.492.50 billion invested in new projects

Operating ratio a favourable 76 percent

Additional Rs.200 billion earned on freight services

790 million tonnes payload target achieved

15,000 automated ticket machines by 2009

Wait-listed e-tickets to be introduced

15,000 automated ticket machines by 2009

Smartcard technology for ticketing system

Rs.40 billion to be spent on green toilets

More trains in peak season

Rajdhani and Shatabdi trains to have new coaches by 2011

Rs.250 billion in profits in 2007-08

New earnings of 21 percent in 2007-08

Rs.300 billion to be spent on network expansion

Rs.492.50 billion invested in new projects

Cash surplus in 2007-08 at Rs.250 billion

Operating ratio a favourable 76 percent

Additional Rs.200 billion earned on freight services

790 tonnes payload or weight per freight train target achieved

Payload to go up 78 percent by increasing wagons to 58 from 40

15,000 freight wagons to be added

470 engines to be added in 2008-09

Source: various online sources

New Delhi:  With marginal cuts in freight and passenger fares and with a cash profit of Rs 25000 crore for this fiscal, Railways Minister Lalu Prasad presented his fifth budget Tuesday, adding another chapter to the dramatic turnaround story of the Indian Railways. Run-up to Budget 2008-09

Springing a surprise on 14 million passengers who travel by Indian trains every day, Lalu Prasad said that fares would be cut by five per cent in sleeper class, four per cent in AC II Class, three per cent in AC III Tier and seven per cent in AC I Class. Transportation of fuels would also cost five per cent less.

The minister also announced in the Lok Sabha 10 new ‘garib raths’ and 53 other new trains for the next fiscal. He said that for the first time tickets would have the expected time of arrival of trains to ensure punctuality.

Indian CA’s can look forward to practice in Australia and UK as ICAI is in the process  fof sighing agreements with its counterparts for mutual recognition of each others course.

As per ICAI president Ved Jain there is a possibility to sign MRA(Mutual Recognition Agreeements) with Australia and England.

MUMBAI (Reuters) - The rupee moved in tandem with equities that were trading lower in afternoon trade on Friday, in the absence of cues from Asian markets, many of which were closed for a holiday, dealers said.

* At 12:05 p.m., the partially convertible rupee was was at 39.56/57 per dollar, weaker than previous close of 39.535/545.

* India’s benchmark share index see-sawed on Friday, twice dipping into the red only to recoup those losses. It fell 3.4 percent on Thursday, weighed down by fears of a U.S. recession.   -Reuters

India’s benchmark stock index tumbled the most in two weeks, led by Reliance Industries Ltd., after the government forecast economic growth would slow as higher interest rates curb consumer spending. Reliance Industries, the nation’s most valuable company, and Larsen & Toubro Ltd., the country’s largest engineering company, fell to two-week lows. Oil companies declined after Minister Murli Deora declined to say when the Cabinet would discuss retail pump prices for gasoline and diesel.

India, Asia’s third-largest economy, is expected to expand 8.7 percent in the year to March 31, the weakest pace since 2005, according to India’s statistics office. Growth was 9.6 percent in the last financial year. The central bank has raised interest rates nine times since October 2004 to contain inflation.

Reliance Infratel IPO is the next big public issue from the Anil Dirubhai Ambani led ADAG group.  Reliance Infratel IPO will issue over 8.91 crore equity shares of Rs. 5 each, with the price band to be decided later.The company has filed its Draft prospectus with SEBI for Reliance Infratel IPO which is engaged in the tower business and plans to raise around Rs. 5000 to 6000 crore through the public issue by selling only 10% of its post-issue paid capital which puts the overall company valuations around Rs. 60000 crore. It is previously known that the company has sold 5 percent stake in the Reliance Telcom Infrastructure valued at Rs. 1400 crore to a group of institutional investors.

Reliance Infratel IPO Analysis : Company is engaged in the business of Building and operating the telecommunication towers and has over 14,000 towers across India when its was last valued, and the company has set a target to reach 40,000 towers by the end of March 2008. Reliance Infratel is the single largest tower company in India with aggressive expansion plans to add more than 20000 towers in the coming financial year.

Reliance Infratel is the demerged tower business company of Reliance Communications which holds 95 per cent stake in the company . With the upcoming Reliance Infratel IPO, Reliance Communication share holders will get value unlocking of around Rs. 250 to Rs 300 per share. Based on this news the stock price of Reliance Communications soared up to close at Rs. 685 per share up by 11 per cent.

Post Reliance Infratel IPO , the company plans to use the funds raised through the issue for financing the passive infrastructure development of tower sites. Reliance Infratel IPO is to be listed on the BSE and NSE and the company has appointed

More information on the Reliance Infratel IPO Subscription dates and analysis and review of the Reliance Infratel IPO will be posted here soon. Do check back for updates on the Reliance Infratel IPO

Reliance Power IPO Listing Date has been announced by the company and the issue is all set to list on the BSE and NSE exchanges on Monday, 11th of February, 2008. Reliance Power IPO Allotment has been recently completed in record time and the Refunds have already started coming in to the bank accounts as per the registrar. Reliance Power IPO Listing price is expected around Rs. 600 according to most of the analysts. Grey Market Premium for the issue is also quoting around Rs. 180, which indicates that the listing is expected at over Rs. 625. Investors can stay invested in the Reliance Power IPO with medium to long term horizon, as the company is expected to do well in the buzzing power space in the coming years. Good luck for all and can definitely expect that the listing of Reliance Power IPO will bring more joys to the markets. Reliance Power IPO stock code will be updated soon. Do visit us back for Reliance Power IOP listing Details.

Mumbai (PTI): Market regulator SEBI on Thursday raised the limit of cumulative investment in government debt securities by FIIs and their sub accounts by $ 600 million to $ 3.2 billion.

“It has now been decided to further enhance the limit (for FIIs/sub-accounts cumulative investment in Government/Treasury Bills) to $ 3.2 billion,” SEBI said in a circular.

Earlier last year, SEBI had raised this limit to $ 2.6 billion from $ 2 billion.

The market regulator has also decided to treat all investments by FIIs and their sub-accounts in units of debt-oriented mutual funds as corporate debt only.

As such, FII investment in these units would have to prescribe to $ 1.5-billion ceiling, as is stipulated for corporate debt.

Currently, there was no uniformity whether to consider investments by FIIs in debt-oriented mutual funds as debt or equity.

 Source

Mumbai (PTI): The Bombay Stock Exchange benchmark Sensex moved up by 253.45 points in early trade on Friday on emergence of buying by funds at existing lower level.

The 30-share index, Sensex, which lost 110 points on Thursday, bounced back by 253.45 points to 17,902.16 in the first five minutes of trade.

Similarly, the wide-based National Stock Exchange’s index Nifty also rose by 77.90 points to 5,215.35 as most of the heavy-weight stocks like Reliance Industries and Infosys Technology gained substantial ground.

SENSEX CRASHES…

Sensex, Nifty see largest-ever fall

It was nightmare on Dalal Street today as the market saw its second biggest fall since 2006.

Sensex closed at 17605.35, down 1408.35 points and Nifty at 5208.80, down 496.50 points from the previous close.

Source : Rediff