ICICI Bank to discontinue Kingfisher co-branded credit card
New Delhi, Feb 20:
ICICI Bank has decided to discontinue its co-branded credit card with Kingfisher Airlines in the wake of the continued grounding of the debt-laden air carrier.
"ICICI Bank and Kingfisher Airlines' co-branded credit card programme has been discontinued due to discontinuation of Kingfisher Airlines services," the bank said in a communication to its customers.
"As a result, the ICICI Bank Kingfisher Airlines Credit Card will be valid till March 31, 2013," it said, while asking card users to opt for another credit card from the bank.
The bank further said it would issue an 'ICICI Bank Platinum Visa Credit Card' to users of the ICICI-Kingfisher card without any annual fees from March 15 onwards with the same interest rate and credit limit as that on the existing card.
The customers would, however, be free to opt for any other card available with the bank in line with their requirements.
ICICI Bank used to be a major lender for the ailing airline, but later sold off its entire Kingfisher debt of Rs 430 crore loans to a debt fund managed by SREI Infra Finance in July 2012.
Engulfed in a major crisis involving huge debts of over Rs 7,500 crore and non-payment of staff salaries, Kingfisher Airlines had to ground its services last year and the carrier is still struggling to revive its operations.
The airline has never posted a full-year profit and it has accumulated losses of about Rs 8,000 crore.
A host of lenders, including public sector giant SBI, recently decided to start the process of recalling their loans to Kingfisher after months of discussions with the airline management for recovery of their debt and revival of the carrier's flight operations failed to yield desired results.
I-T Dept files case against Kingfisher for not remitting TDS amount
Special court for economic offences issues summons to Mallya
Bangalore, Feb. 20:
Financial crisis hit Kingfisher Airlines Ltd and its head Vijay Mallya are in deeper trouble. The Special Court for Economic Offences, Bangalore, on Wednesday ordered the issue of summons to Mallya on a criminal case filed by the Income-Tax Department for not remitting tax deducted at source (TDS) to the Government.
The Special Court took cognisance of the offence under Section 276B and 278B of the I-T Act, 1962 for not remitting Rs 74.94 crore, deducted by the company as TDS from the salaries of its employees for financial year 2009-10, and the interest of Rs 23.70 crore levied for not remitting the amount within the period stipulated in the law. The next hearing of the case will be on April 19.
If found guilty for failing to remit the TDS amount to the government, the representative of the company ( Mallya) can be punished with rigorous imprisonment for a minimum of three months to a maximum of seven years.
Presenting the case, the Department's counsel Jeevan N contended before the Court that the conduct of the company and Mallya, its Chairman and Managing Director, cannot be excused. They are not permitted to use the amount deducted in the form of TDS as this money belongs to the Union Government and the company is only authorised to deduct it from the employees' salaries on behalf of the Government.
"It is not the tax liability of the company but amounts to withholding money belonging to the Government. No account of helplessness or financial difficulty can come to the aid of the company to withhold the TDS amount. The company cannot make use of TDS amount for any purpose," the Department stated in the complaint.
Meanwhile, the Department also stated in the complaint that the company has to give the Government Rs 401 crore — the TDS amount deducted from salaries and from payments made to various others for financial years 2008 to 2012.
It was pointed out in the complaint that the company did not respond to many of the Department's communications demanding payment and, on certain occasions, the company had raised objections to the TDS dues being assessed at Rs 401 crore. The TDS assessments were made after the company premises were raided in March 2011.
During the proceedings before the Income-Tax Appellate Tribunal and the Karnataka High Court regarding the dispute over the TDS assessment, it was alleged in the complaint that the company did not remit the amount even after the High Court, in a December 5, 2012 order, directed it to pay 50 per cent of the total amount outstanding and to give a bank guarantee within six weeks for the remaining 50 per cent amount.
Direct Taxes Code Bill may be delayed further
New Delhi, Feb. 20:
The critical reform Bill on Direct Taxes Code may get delayed further, as it has not been placed in the list of the Bills scheduled for consideration and passage during the Budget Session starting on Thursday.
Just last month the Finance Ministry had highlighted the 'Direct Taxes Code' as a policy reform, unveiled during road-shows in Singapore and Hong Kong. The road-shows were meant to attract foreign investment. The Bill was introduced in Lok Sabha on August 30, 2010 and was referred to a Standing Committee on September 9, 2010. After detailed examination and hearing views from various stakeholders, the Standing Committee on Finance, chaired by former External Affairs and Finance Minister Yashwant Sinha submitted its report to the Lok Sabha Speaker on March 6, 2012, which was subsequently presented to Lok Sabha and laid in the Rajya Sabha on March 13, 2012.
Apart from various recommendations, the Committee suggested raising the income-tax lower slab to Rs 3 lakh from Rs 2 lakh, which is also the current structure as well as proposed in DTC Bill. It did not recommend any change in the proposed rate of 30 per cent corporate tax for companies. It also made a suggestion to raise the minimum threshold for wealth tax to Rs 5 crore.
These recommendations are not binding on the Government and the Bill is free to move to Parliament for consideration and passage, with or without amendments. However, to garner wide support, the Government is considering some amendments and will obtain Cabinet approval.
It may be recalled that on January 31, Advisor to the Finance Minister Parthasarathi Shome had said that the Government would come up with a modified Direct Taxes Code (DTC) Bill after incorporating the suggestions of the Standing Committee.
Earlier, there was a thinking that the new tax system would come into effect from April 1, 2013. But, last year, Finance Minister P. Chidambaram indicated that the Government might not be able to keep this date.
On August 28, 2012, when he was asked about it, he had said, "I can't say. DTC has gone through various versions."
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