Financial sector biggies shell out higher amounts as advance tax

Mumbai: Financial sector majors have shelled out a higher advance tax in Q2 FY 11 as compared to the year ago period, indicating that the sector is geared to perform healthily this fiscal, reports PTI.

India's largest and public sector State Bank of India (SBI) has paid Rs1,924 crore as advance tax in the July-September quarter as against Rs1,832 crore in the year-ago period.

ICICI Bank, the country's second-largest has paid Rs600 crore while last year the private sector bank had shelled out Rs501 crore, an Income Tax source said.

Home loans major, HDFC, has paid Rs400 crore this quarter as against Rs320 crore in the year-ago period.

New-gen private sector bank Yes Bank said in a statement that it has paid an 81% more advance tax this quarter at Rs105 crore, as against Rs58 crore in the same quarter last year, Dhanalakshmi Bank, an old private sector bank has paid the same amount as last year - Rs3 crore, a source close to the development said.

HDFC Bank has paid Rs600 crore this quarter as against Rs425 crore in the same quarter last fiscal while life insurance giant, LIC, has shelled out a higher amount at Rs1,067 crore as against Rs939 crore in the year-ago period, the Income Tax source said.

The figures available so far indicate that the financial sector has fared fairly robustly this fiscal and has emerged as a major contributor to the government's tax kitty.


No back door entry to private firms for mining: B K Handique

New Delhi: The government today said it would not tolerate any "back door" entries by industry for seeking mines, a move that could dampen corporate efforts of forging alliances with public sector undertakings (PSUs) for their mining projects, reports PTI.

Asked about the industrial controversies relating to mining activities like that in Orissa, mines minister B K Handique said that mining lease was given to a state PSU and not the corporate giant Vedanta Resources.

"In the name of PSUs, no more back door entry will be allowed. Yes, they (private companies) have made back door entries," Mr Handique told reporters on the sidelines of Federation of Indian Mineral Industries' (FIMI) 44th Annual General Meeting here.

Sources in the ministry said that the new mining bill will not allow such indirect route adopted by private firms to pursue mining projects by joining hands with state mineral companies.

"We are not against joint ventures. But if the mining lease is given to PSUs it should be utilised by PSUs. In the new Act, we will plug the existing legislative loophole to ensure this," a senior mines ministry official said.

The mines ministry is working to bring in transparency in the sector through a new legislation which is likely to be presented in the Winter session of Parliament.

Many state PSUs have tied up with private firms forming projects including Orissa Mineral Corporation (OMC) and Mysore Mineral Ltd (MML).

While OMC has inked pact with Vedanta Group firm, MML has entered an agreement with JSW Steel Ltd for mining. Andhra Pradesh Mineral Development Corporation has also tied up with JSW Group for bauxite mining at Araku region.

OMC holds a bauxite mining lease at ecologically sensitive Niyamgiri hills in Orissa while MML has got the rights to mine iron ore in Thimmappangudi Mine in Karnataka.

Meanwhile apex miners' body FIMI had blamed state PSUs for taking advantage of private firms under the joint venture mining route.

Billionaire Anil Agarwal-led Vedanta Group was refused green clearances for its proposed mining project at Niyamgiri hills in Orissa for which it had tied up with OMC.

Vedanta Resources flagship firm Sterlite Industries had entered into a pact with OMC in 2004 for bauxite mining to feed its aluminium project in Orissa.

"In 2004, it (mining lease for Niyamgiri) was given to OMC, so through back door entry they have done it. Whichever route you take that must be correct. We have not given approval to Vedanta. We approved it for OMC," Mr Handique said.

"Definitely I do agree, the environment ministry should be staying it, otherwise there will be a disaster," Mr Handique said.


State FMs to meet on 20th September on GST

New Delhi: State finance ministers are likely to meet on 20th September to discuss the constitutional amendments needed to roll out the proposed Goods and Services Tax (GST), reports PTI.

"The state finance ministers would meet on 20th September to discuss the re-revised draft of the Constitution Amendment Bill on Goods and Services Tax (GST)," a source told PTI.

However, according to sources, the meeting is unlikely to yield much results as the BJP-ruled states are firm on their views to oppose the existing structure of the proposed indirect tax regime.

"We do not support the existing structure of GST, as it would hamper the state autonomy. We would oppose it in the present form," Madhya Pradesh finance minister Raghavji said.

GST is likely to miss the 1 April, 2011, deadline as the Constitutional Amendment Bill on GST could not be introduced in the Monsoon session.

The indirect tax regime is expected to replace excise duty, service tax on the Centre's end and VAT on the states front, besides local levies, cesses and surcharges.

The BJP-ruled states had objected the revised draft of the GST, saying it does not clarify how the changes will be brought about in the GST structure.

The earlier draft was rejected by the states on account of the proposed vesting of veto powers with the Union finance minister on state taxation issues.

The first draft had proposed setting up of a GST Council to take decisions on GST with the consent of the Union finance minister and a two-third majority of states.

The revised draft, however, said the council could take a decision only when there is a consensus.

However, BJP-ruled states wanted to know the clear meaning of consensus and suggested changing this word with "consent". Both the drafts have also suggested a dispute settlement mechanism.

Mr Mukherjee had said a third revised draft would be prepared to sort out states' concerns and the finance ministry officials have started preparing it.


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