Citizens' Issues
Ambani, Mittal, Shanghvi, Premji & Mistry own half of billionaire wealth

Mukesh Ambani, Lakshmi Mittal, Sun Pharma's Dilip Shanghvi, Wipro's Azim Premji and Pallonji Shapoorji Mistry, together control $85.5 billion or about Rs5.24 lakh crore in personal wealth, accounting for 47.5% of India's total billionaire wealth


India's top five billionaires led by Reliance Industries Ltd (RIL) chairman Mukesh Ambani collectively control $85.5 billion (about Rs5.24 lakh crore) in personal wealth, accounting for nearly half of the country's total billionaire wealth, a new study said.


According to the analysis by wealth research firm Wealth-X on India's richest individuals, Mukesh Ambani remains the richest man in the country with an estimated net worth of $24.4 billion (about Rs1.49 lakh crore).


Ambani is followed by steel tycoon Lakshmi Mittal, drugmaker Sun Pharma's Dilip Shanghvi, IT giant Wipro's Azim Premji and Tata Sons' shareholder Pallonji Shapoorji Mistry, among the top-five wealthiest individuals from India.


"The five billionaires collectively control $85.5 billion in personal wealth, accounting for 47.5% of India's total billionaire wealth," Wealth-X said.


Observing that "entrepreneurialism is the key to attaining financial success in the world's largest democracy", the study further said that these five entrepreneurs have made their fortunes through their businesses in sectors such as oil and gas, steel and pharmaceuticals.


In comparison, India's wealthiest actor, Bollywood star Shah Rukh Khan, is worth $600 million, while Indian cricket legend Sachin Tendulkar, who retired in November 2013, has a personal fortune of at least $160 million, it added.


Through RIL group, Ambani owns 'Mumbai Indians', a team in the Indian Premier League (IPL) cricket, reportedly the most valuable team at around $112 million, the report added.


Steel tycoon Lakshmi Mittal takes second place on the list with a personal net worth of $17.2 billion. Mittal is the chairman and CEO of Arcelor Mittal, the world's largest steel making company. Mittal, 64, owns 38% of ArcelorMittal and a 33% stake in the Queens Park Rangers Football Club.


Sun Pharmacuetical's Dilip Sanghvi is the third wealthiest Indian on the list with an estimated net worth of $15.63 billion, followed by Wipro Chairman Azim Premji ($14.9 billion) and Tata Sons Shareholder Pallonji Shapoorji Mistry ($12.7 billion).


All five entrepreneurs have also established philanthropic foundations in support of causes ranging from education, health, environment, social welfare and community development, the report said.


How this new CBDT rule will create problems for your tax audit
The number of clauses in Form 3CD has increased to 41 this year from 32 last year, along with onerous and confusing new requirements
The Central Board of Direct Taxes (CBDT) issued a notification (33/2014) on 25 July 2014 for amending forms 3CA, 3CB and 3CD. For chartered accountants (CAs), who have already finalised their audits and filed report online and had the same confirmed online by the auditee before 25 July 2014, there is no problem. In case the CA has filed the report before 25 July 2014 and the auditee has confirmed it online on or after 25 July 2014, there is no clarity on whether the report will be accepted or not. We will just have to wait for the clarification to come from the CBDT.
I will not write too much on the technical aspects of the changes, which have taken place, as I am sure there will be a lot of seminars and conferences where these changes will be taken up. This article proposes to deal only with the challenges, the auditor is likely to face, specially as this notification has come at a time when CA firms are at the end of most audit finalisation and there are less than two months left for the deadline for such filing (30 September 2014). The number of clauses in Form 3CD has increased to 41 this year from 32 last year.
Clause 11(b) has now put forth a requirement to give addresses of locations along with the books of accounts maintained at each location. Take for example, State Bank of India (SBI) has more than 3,000 branches. How is the auditor going to enter that kind of data into his tax audit report? Can a PDF file be obtained from the Bank and the same uploaded into the online Form 3CD? One does not know whether this has even been thought of at the time of drafting these requirements. What happens to books maintained in electronic format and data in cloud computers located say in the US? Almost all modern offices used computers and have data on servers located in remote places – there is no clarity on how one will report on this!
Clause 11(c) requires the auditor to report on “List of books of account and nature of relevant documents examined”. Now this clause is so vague. What documents are we talking about? Are we talking about payment/ receipt vouchers, purchase / sales process documents, journals, agreements, contracts – what are we talking about? In big industrial organisations, there are hundreds of agreements and contracts (if we restrict ourselves to only these), which will have to be listed and uploaded in the return. As the tax audit online return forms have not been notified as yet, we have no clue as to the amount of data that will be accepted. Will we be allowed to upload a PDF file giving the requested details? Also it is the time this will take to compile is suspect as of now, as there is no clarity on what the department means by “relevant documents”.
Clause 21 in lieu of old clause 11(a,b,c) has done away with providing details for advertisements in brochures, pamphlets produced by political parties and it asks for the details to be given in the attached table format. The table format still contains above words, so there is still a lot of work to be done on the above – otherwise this is going to lead to a lot of confusion. 
The requirements for reporting of payments other than by account payee cheque under section 40A(3) read with Rule 6DD, has done away with the requirement of obtaining a certificate to that effect from the client. Modern business includes payments by real time gross settlement systems (RTGS), national electronic funds transfer (NEFT) and interbank mobile payment system or immediate payment service (IMPS). What are the reporting requirements for such kind of payments? There is no clarity on this.
Clause 34 requires the tax deducted at source (TDS) details to be certified by the auditor. The table requirements, as notified appear to be a straight copy of the Form 26Q, which one files every quarter while filing the TDS return. The requirements are for the auditor to certify short payments, payments at rates less than the rate specified, non-payment, and no deduction of TDS. This data for even small to medium sized companies is huge and having the same uploaded into the tax audit report is going to be a challenge. Companies supplying tax filing software will have their hands full trying to deliver software, which will take care of these additional requirements.
Clause 41 wants the auditor to report in connection with various demands raised by various government departments. If the client does not share this information, it is going to be very difficult to report unless there is a financial impact, which one can find out during the course of audit. One is not sure whether only demand paid in pursuant to an order passed by the relevant tax authority is required to be reported under clause 41.
The Institute of Chartered Accountants of India (ICAI) should take up with the Finance Ministry, the question of bringing in such wide ranging requirements at the eleventh hour. We as a professional body should advise the Ministry that all such requirements should be notified in March of the relevant financial year and not in July or August as that leaves very little time for clients, professionals and software companies to gear up and make suitable changes to their plans to accommodate such last minute requirements. 
As far as the department itself is concerned, new Forms still do not appear on the Income Tax (I-T)  Department web-site. Professionals using tax software also have to wait for updates to come to complete their task of finalising audits and uploading the tax audit reports and returns. 
All changes are welcome – it is clear that the tax department is putting complete responsibility of assessment of returns on the auditor. The task is too onerous and time-consuming to do it in the short time frame expected – the audit is risk vis-à-vis the audit fees is too high, especially when the auditor is expected to certify the report as true and correct! The best thing to do would be to extend the date for filing the tax audit report to 31 December 2014 or in the alternative make the new forms applicable from AY2015-16.




2 years ago

Is it now necessary for the Auditors to Report under the famous CLAUSE 34 TAX AUDIT REPORT how many times Employees go to the loo and how many times for "official reasons" and how many times for "personal reasons" and whether any GOI TDS is deductible AND If not Auditors should explain in their Report "why no TDS was deducted" giving the appropriate TDS Section....


2 years ago

The CLAUSE 34 Requirements of our SME PVT.LTD.Company are so baffling to understand that Accountants and Auditors do not see eye to eye. What the hell is this CBDT trying to prove? That the Tax-Paying Public are Furnishing Falsehoods while the HOLY COW GOI is performing HOLY RITES?


3 years ago

They are asking for more information most certainly trying to push the responsibility on the shoulders of the Auditor's. This is a similar strategy adopted during the introduction of TDS, wherein they could not catch each and everybody so they pushed the responsibility of collecting Tax on big businesses.

Twitter launches video ads

The new video ad feature would bring advertising revenue for Twitter, which has struggled to convince investors it is on a path to profitability


Twitter has unveiled a new advertising programme that delivers “promoted videos” to the tweet stream of users of the popular messaging platform.


The new programme adds to the source of advertising revenue for Twitter, which has struggled to convince investors it is on a path to profitability.


“By using Promoted Video, it’s easy for brands to upload and distribute video on Twitter, and to measure the reach and effectiveness of this content,” product manager David Regan said in a blog post.


Regan said the test launch came “after months of experiments and feedback from users and brands.”


Regan said that to make it easier for advertisers, Twitter will offer a “cost per view” model: “This means advertisers only get charged when a user starts playing the video,” he said.


“Additionally, advertisers using Promoted Video have access to robust video analytics,” such as how many people view the entire video, he said.


Twitter accounted for 0.5% of global digital ad revenues in 2013, according to research firm eMarketer, and expects to increase that to 0.8% this year, as digital ad spending grows to $140.15 billion.


Twitter said last month that the number of monthly active users of the platform has hit 271 million, up 24% when compared with the same period a year earlier.


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