| Composite foreign investment caps in Cabinet today |
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New Delhi, 15 July The Cabinet is likely to consider a proposal on Thursday to merge limits of foreign direct and portfolio investments into composite caps to make foreign investment regime easier. The department of industrial policy and promotion ( DIPP) had prepared a Cabinet note proposing a combined cap in most sectors where foreign direct investment (FDI) is allowed or where foreign institutional investors ( FII) have a separate limit. Composite caps have been suggested for sectors like agriculture, tea plantations, petroleum and natural gas, manufacturing, airports, real estate, telecommunications, mining, non- banking financial companies and pharmaceuticals. In some sectors where only FDI and FII investments are allowed now, the department has proposed investments by non- resident Indians and foreign venture capital firms as well. These include up to 100 per cent foreign investment in asset reconstruction companies, 74 per cent in private banking, 20 per cent in public- sector banks and 49 per cent in power exchanges. The department is of the view that the proposal would provide Indian companies awider choice of investors. The proposal rejected the contention that portfolio investments were neither lasting nor intended to control a company. It argued there were cases of companies being controlled by portfolio investors, and hence the need for composite caps. For instance, broadcasting carriage services had a sectoral FDI cap of 74 per cent, of which 49 per cent could come through the automatic route. A company, the proposal pointed out, could simultaneously have 51 per cent FII holding through a special resolution of its general body followed by a board resolution. |
| Sebi speeds IPO clearance to revive primary market |
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Mumbai, 15 July The Securities and Exchange Board of India ( Sebi) has issued its first observation on the proposed ₹ 1,100- crore Initial Public Offer ( for equity) of Coffee Day Enterprises. This has come within three weeks of the country's largest chain operator in this segment filing the offer document. Sebi is presently aiming to infuse more life into the moribund IPO market and is hastening the clearance process. The market regulator has taken an of average 70 days to issue its final observations on the Draft Red Herring Prospectus' filed in the first half 2015. In comparison, it took nearly 120 days to give these on offer documents filed with it a year before. It should be noted, though, that the delay is may atime also due to delay on the issuer's part in responding to Sebi's queries. "Sebi has been speeding up its clearing process. If there is a need for clarification, it is being sought at the earliest," said a source. Others say Sebi has reshuffled its corporate finance division to ensure smoothening of the process. Some marquee names are in the line for an IPO nod. These include InterGlobe Aviation, owner of Indias biggest airline, IndiGo. GVK Airport Developers, which operates the airports at Mumbai & Bengaluru, plans to file offer documents soon. "Sebi has been very proactive lately in clearing offer documents. Overall, the process has become much faster than in the past," said an official with a leading investment bank, asking not be named. So far in 2015, Sebi has cleared close to two dozen IPOs, which cumulatively are looking to raise about ₹ 8,000 crore. About eight more filed this year are awaiting anod, for IPOs worth around ₹ 7,000 crore. Despite a sharp rally in the companies raised money (₹ 1,800 crore in all) by way of IPOs on the two major exchanges, even as the benchmark indices rose 30 per cent. So far this year, the trend hasn't changed much. Around ₹ 1,700 crore has been raised via five IPO deals so far in 2015. Sebi has also been taking other steps to infuse life into the primary market. It has held meetings with investment banks and issuers to understand the issues preventing them from coming to the market. Also, it has been easing some primary market norms— allowing doubling of the anchor investor quota, for instance— to facilitate smoother capital raising. Reshuffles corporate finance division to ensure smoothening of the process; average time to clear offer documents this year has been 70 days Navkar Corp Mar31 May 22 52 600 SSIPL Retail Mar16 May 25 70 95 AGS Transact Technologies Mar24 May 28 65 1350 Dilip Buildcon Mar31 Jun 1 62 750 Shree Shubham Logistics Feb 20 Jun 2 102 210 Amar Ujala Publications Mar27 Jun 3 68 60 Prabhat Dairy Mar31 Jun 8 69 275 Syngene International Apr22 Jun 12 51 400 SH Kelkar Mar24 Jun 18 86 250 Source: Prime Database |
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| Avoid these mistakes while filing I- T returns |
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You open a recurring deposit in your child's name and invest ₹ 5,000 every month. If the interest earned on it is not declared while filing tax returns, the authorities can send you a notice, as it would amount to tax evasion. Thats because the interest earned by a child below 18 years is clubbed with the income of the parent. There are several such instances when individuals don't declare their income or assets because they do not realise these items are taxable. Another example: interest earned on the cash in your savings bank SB account. In a financial year, if a person receives over ₹ 10,000 in interest in the SB account, he needs to pay tax on it. "Many people don't include the interest earned on company deposits, fixed deposits, and postal saving schemes, as tax is deducted at source on these investments. However, they are supposed to declare and pay the applicable on it," says Kuldip Kumar, partner at PwC. Many don't report income that is exempted from tax. Say, someone sells his or her mutual fund investment after one year of holding it or receives dividends on the stocks. In the income tax form, there's a separate schedule for such income that is exempted from tax and individuals have to declare it. According to the law, if a person receives a gift valued above ₹ 50,000 from a non- relative, he or she needs to pay tax on it. The value of such items is clubbed with one's income and taxed according to the slab. However, there are certain exceptions. For example, presents received in a wedding. While these need to be declared, you don't need to pay tax. Amit Ajmera, director – direct tax, DBO India, points out another common mistake. " These days, many taxpayers own two houses. If the second house is not let out, the owner still needs to pay tax on the rent he would have received through the property." For this, the person needs to find the ongoing rent in the area, say from a real estate broker, and compute his tax liability accordingly. Experts say before filing returns, the person should go through the Form 26AS, which is accessible once he logs into the income tax department's e- filing website. Other than the tax deducted by the employer, taxpayers need to go through the other instances of TDS. In case the TDS from a bank or any other institution is not reflecting in Form 26AS, the person needs to approach them and ask for an update. "When people change jobs in the middle of the financial year, they forget to report the income earned from the former employer. Form 26AS comes handy to compute the tax," says Ajmera. Many salaried don't file income tax returns if they don't have investments or other income. Tax experts say filing of return is compulsory if your income is taxable. Once the filing is done, make sure ITR- V is duly signed and sent to the central processing centre, Bengaluru, and that the authorities have received it. If this is not done, the I- T filing is considered as invalid. Don't forget to include interest earned on investments and also declare those exempt from tax >YOUR MONEY |
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