GoM for conditional approval for Cairn-Vedanta deal

The GoM felt that as a pre-condition for the nod, Cairn or its successor should consent to paying cess on the all important Rajasthan block as well as agree to cost-recovery of Rs18,000 crore in royalty that state-owned ONGC pays on the fields

New Delhi: Recommending conditional approval for the Cairn-Vedanta deal, a Group of Ministers (GoM) on Friday said the two companies must agree to treating royalty on the mainstay Rajasthan block as cost recoverable, and agree to pay cess, reports PTI.

Sources privy to the deliberations said the GoM felt that as a pre-condition for the nod, Cairn or its successor should consent to paying cess on the all important Rajasthan block as well as agree to cost-recovery of Rs18,000 crore in royalty that state-owned Oil and Natural Gas Corporation (ONGC) pays on the fields.

Cairn should also withdraw arbitration proceeding it has initiated, disputing its liability to pay Rs2,500 per ton cess on its 70% share in the Rajasthan block.

The recommendation of the GoM headed by finance minister Pranab Mukherjee will go to the Cabinet Committee on Economic Affairs (CCEA) in two weeks time, oil minister S Jaipal Reddy told reporters after the 75-minute long meeting.

“It (GoM) has looked at various aspects of the ($9.6 billion) deal. It has taken a view on the matter. This view will be presented to the CCEA. The GoM is not going to meet again,” he told reporters here. “The recommendation was unanimous.”

He refused to any details of deliberations at the GoM.

Cairn will also have to seek consent of ONGC, which holds stake in 8 out of the 10 properties held by Cairn India in the country.

Also, Vedanta will need a security clearance from the ministry of home affairs.

Cairn holds 70% interest in the Rajasthan block but does not pay any royalty. It is opposed to cost recovery of royalty payments that ONGC makes on its behalf.

Meanwhile, ahead of the GoM meet, London-listed mining group Vedanta Resources said it has raised $1.65 billion (Rs7,425 crore) through private placement of bonds to part-finance its $9.4 billion acquisition of Cairn India.

Vedanta had in August agreed to buy at least 40% stake in Cairn India from its parent Cairn Energy Plc.

Cairn has refused to accept the requirement of partner consent even though five oil blocks it won under New Exploration Licensing Policy (NELP) explicitly provides for obtaining no objection from partners in case of change of ownership.

It holds 70% interest in the Rajasthan block but does not pay any royalty. It is opposed to cost recovery of the Rs18,000 crore royalty payments that ONGC has to make on its 30%, as well as Cairn's share of production. ONGC made the demand a month prior to the announcement of the Cairn-Vedanta deal in August 2010.

The CCEA had on 6th April constituted a GoM to look into the issue of conditional or unconditional consent to the Cairn-Vedanta deal.

Friday was the first meeting of the GoM which also comprised law minister M Veerappa Moily, telecom minister Kapil Sibal, commerce minister Anand Sharma and Planning Commission deputy chairman Montek Singh Ahluwalia.

Mr Sharma was unable to attend the meeting.

“We have taken up the matter in right earnest. We have taken a view at our level. The decision has to be taken by CCEA,” Mr Reddy said.

Solicitor General Gopal Subramaniam had in March opined that the government should not give unconditional nod to the deal and reaffirmed its views in a second opinion on 6th April.

User

TVI Express, yet another Speak Asia?

The MLM company promises five-star travel packages on joining and lucrative compensation fees up to Rs4.5 lakh on its direct selling model

Travel Ventures International (TVI) Express, a multi-level marketing (MLM) company, is growing its base in India. And like in the recent case of another MLM, Speak Asia Online that is being investigated, some people are questioning the big promises on its business model.

TVI Express claims to be in the home-based direct selling business, inviting those interested, to become members on a payment of Rs15,500. Members get a seven-nights-eight-days travel package in 3/5 star hotels of their choice, from about 4,000 hotels that the company has a tie-up with. A new member also gets a personal portal, which is primarily a booking website.

The company has a business model which, it says, is compensation-based. The member can sell the travel package to two new members. Those two new members would in turn sell the travel package to a further two members each. This goes on till level four, which is known as "Traveller Board". On completion of Traveller Board the top member is paid a compensation of Rs31,000.

Beyond this there is an "Express Board" level. Once the Traveller Board is completed, members can enter the "Express Board". Here too, the number of new entrants increases, taking the original members a step ahead. On completion of "Express Board", the top member gets Rs4.5 lakh as compensation fees.

Members also get a 5%-10% bonus for every new member joining after he/she "cycles out of Express board".  It also rewards the members with incentives "ranging from luxury cars to private jets and splendid villas in exotic locations around the world."

However, contrary to the company's claims, members have alleged that it is not paying the promised compensation. According to complaints posted on consumer forums on the Internet, the TVI Express business model is a scam, as many members who have increased their down line have not been paid any compensation.

TVI Express has a presence in many countries, among them the United Kingdom, South Africa, Canada, France, Germany and China.

Interestingly, according to a news report, The Bank of Namibia had warned people about investing in TVI Express and Holiday and Cash because they were operating in Namibia in violation of the laws.

When Moneylife called TVI Express, a company official said: "We abide by the laws. We follow all the rules and regulations. Ours is not an investment scheme; our business works on compensation fees which we pay to our members, who generate business for us. Those who work, earn. All these complaints are posted by our competitors who are jealous of our business growth."

Meanwhile, it has been reported that bank accounts in Singapore of Speak Asia, the online survey company which is being investigated, have been frozen, disrupting payouts to vendors, clients and staff.  

Moneylife has consistently exposed the dubious claims made by such MLM companies that are promising high returns in a short span. (Read, "Stay on guard: Need to regulate MLM firms, websites, so investors don't suffer".)

User

COMMENTS

GOVINDAN

6 years ago

Speak Asians say their company's Singapore bank account was frozen as a result of adverse media campaign unleashed by Star News.

Ridiculous.

How can a Bank freeze the account of a customer stating reasons of "Adverse media reports"?

Can any Speak Asian disclose the legal steps the company has taken to unfreeze the Bank Accounts?

Hars

6 years ago

There is another company like this named- xlnc in Bandra who does not deliver what it promises.

REPLY

Akash Mehra

In Reply to Hars 6 years ago

@Hars

No information about xlnc but did you ever try TVI Express. And this is not a sales pitch..

The point here is that no comments ahould be made until and unless the product is tried, and tested.

Moneylife reporter has gone absurd here publishing bullshit about aan orgaanization that has a goood ravel package as well as pays off well.

Akash

govindan

In Reply to Akash Mehra 6 years ago

Goood "ravel" package indeed!!

Kishore

In Reply to Hars 6 years ago

Yes, I went to their offive in Khar and they have good set of people to convince you. i landed up buying 3 id's. 2 for vacation package and 1 for website. Neither the website operates properly nor does the vacation package promised was give. they are frauds. Charged me 17,000 for 2 packages which turned out to be for only 7000. I lost my 10,000 besides the website charges of 12,000 which is a real waste as the rates are higher than other sites and also if someone tries to make a transaction, the credit card is charged but the tickets are not issued.

NEVER INVEST WITH THEM!

Akash Mehra

6 years ago

@anonymous

Unfortunately, it is media and people believe them. They are going to believe these script kiddies even if they write your mom is a prostitute.

They should think before writing as every word written by them can impact thousands of lives. Unfortunately, conspiracy, politics and money revolves around them.

Akash

REPLY

kishore

In Reply to Akash Mehra 6 years ago

MLM professionals and their mental lying:

It is impossible to calculate the moral mischief, if I may so express it, that mental lying has produced in society. When a man has so far corrupted and prostituted the chastity of his mind as to subscribe his professional belief to things he does not believe he has prepared himself for the commission of every other crime (Thomas Paine, The Age of Reason)

kishore

In Reply to Akash Mehra 6 years ago

It is impossible to calculate the moral mischief, if I may so express it, that mental lying has produced in society. When a man has so far corrupted and prostituted the chastity of his mind as to subscribe his professional belief to things he does not believe he has prepared himself for the commission of every other crime (Thomas Paine, The Age of Reason)

Annonymous

6 years ago

This is not done, pls provide the MLM companies an equal opportunity platform. Even a Sales executive who gets 10,000 salary, for getting a business of 10,00,000 gets a commission of 25000-30,000 and then gets into corporate slab of incentives(which at times get into lakhs), so whats the big deal ?

GOVINDAN

6 years ago

Who is this Dr. Maddineni of NANO EXCEL MLM.
Is he a doctor?
Any idea about this man?

rajesh

6 years ago

gald you bought up this MLM scam i had requested you to do a write about it when u wrote on the speak asia story ....... the sheer number of desperate greedy people who fall for this scam is just amazing
The biggest MLM con of course is still good old AMWAY

Akash Mehra

6 years ago

Moneylife Magazine

I strongly urge you to contact TVI Express India to get your facts straightened out. You are a reputed organization and publishing false facts or defaming a company doesnt really suit your profile.

If you knew that TVI Express has completed one year of operations in India, is a valid organization in the Direct Selling Industry, paying proper service taxes and TDS to the government along with fulfillment of the fabulous products they offer you wouldnt have written such an article about them.

I write this as I feel media has to be vigilant before writing anything about a company as people still tend to believe media and not the facts.

As a respected editor working for Moneylife magazine, you should contact them and take this article down comparing TVI Express with Speakasia. There is no comparision between a valid product offering company and an investment plan.

Akash Mehra

REPLY

govindan

In Reply to Akash Mehra 6 years ago

Sir,

Can you please confirm that none of your distributors are from lower strata of the society like housemaids/ domestic helps, coolies, manual laborers, cab drivers, class-IV employees etc etc.,

theertha

In Reply to Akash Mehra 6 years ago


http://www.consumercomplaints.in/complai...

Mustansir Engineer

6 years ago

Respected Editor,

Your article is on TVI Express. Does it make any sense using Speak Asia Online Survey name here for comparision. Is there any similarity in one survey another travel package ?
I honestly believe media should act responsibly when commenting. Your honoured news do make a impact on 19 lakhs Speak Asian Panelist.

REPLY

kris

In Reply to Mustansir Engineer 6 years ago

What about comparing Speak Asia with Ram Survey?

Mustansir Engineer

In Reply to kris 6 years ago

Is there any comparison ?
Speak Asia had paid each panelist till the disruption caused by media. Even after all the onslaught, the board, staff are still present in India.
About Ram Survey, I have no clue. If you have and want to share your views please go ahead.

praful

In Reply to Mustansir Engineer 6 years ago

Is it because of indian Media the singapore bank accounts frozen?

Rahul

6 years ago

I think the most notorious of MLM company is running in Rajasthan Jaipur named Gold Sukh. They have collected tremendous amount of money from the MLM participants. Last year they were raided by Income tax department which took around 29 Crores as taxes. This whole scheme is similar to GoldQuest of Chennai and needs to be investigated. It is one of the biggest scam which can come out..

REPLY

govindan

In Reply to Rahul 6 years ago

All MLM compnaies are notorious. What about NANO EXCEL, UNIPAY/VISAREV, TYCOONS EMPIRES?. NANO EXCEL looted Kerala. Unipay looted Tripura, Gold Sukh looted Rajasthan, RMP Tamil Nadu, Speak asia Maharashtra

Mustansir Engineer

In Reply to govindan 6 years ago

Mr. Govindan,

What is "Speak Asia Maharashtra" ???
Never heard about this organisation...???
Please go ahead and educate me on it...

govindan

In Reply to Mustansir Engineer 6 years ago

Don't worry. you will soon hear about this "organization".

Prasanna

In Reply to govindan 6 years ago

Hello!All,

Pls maintain a distance from Govindan.He is allergic to MLM,so even when some says MLM or Direct selling he will start barking.He will some up with his own stories from kerala,then he will give some evidence of press release,he will name few companies and finally conclude that it's Money Laundering Mechanism.It's not his fault,he has been taught the same lesson and his world is Kerala,Kerala and only Kerala>no use breaking your heads and trying to educate Govindan...he has a mental block for MLM or Direct Selling.Secondly,he is an excellent example of that section of society who will never embrace change or development.They will prefer standing whole day under the sun with flags,but they will not budge their way for development.It is because of such type of people that India has still got the tag of a 'Developing Nation'.

govindan

In Reply to Prasanna 6 years ago

Respected Prasannaji,

Your assessment is correct. We prefer standing whole day with flags under the sun rather than spending a whole day for cheating innocent and uneducated housemaids, domestic helps , coolies, class IV employees, slum dwellers, beggars etc etc

jitender

6 years ago

Dear ,

TVI Express is not a money chain business, it is purely MLM company. it is not very easy to earn Rs. 4,50,000 .

All the best

Akash Mehra

6 years ago

TVI Express pays off very well on the sales that distributors make and is not at all an investment plan.

@Simon, I guess you need to check the services you receive when you become a member. You get a 7 nights/8 days holiday in a resort or a 3 nights/4days accommodation in a business hotel.

We all can write anything here as its a world of free voice.. however, the truth doesnt depart from the fact that TVI Express is not an investment plan and is a legitimate Direct Selling Company like other established players in the industry.

Akash Mehra

SImon

6 years ago

You wrote, "Members get a seven-nights-eight-days travel package in 3/5 star hotels of their choice, from about 4,000 hotels that the company has a tie-up with."
This is wrong. Members get nothing against the Rs15,500 except that they become member.

REPLY

jkwonders

In Reply to SImon 6 years ago

Dear Simon,

My friends have already travell under this pacakage , If you want to travell under this pacakge revert me.

Just travell and then make any thought dear for any body.

Waiting for reply

GOVINDAN

6 years ago



MLM = Money Laundering Mechanism

RBI slaps notices on several banks, asking them to pay crores of rupees as fine for dishonour of instruments under ECS beyond the acceptable limits

The Reserve Bank of India has written letters to several banks because they have crossed the limit of instruments dishonoured under the Electronic Clearing Service (ECS); 3%-5% is the acceptable apex bank norm—in a few cases, the percentage of dishonoured instruments under ECS has been as high as 30% to 40%. However, this move is a warning, and may not lead to punitive action 

The RBI (Reserve Bank of India) keeps a track on the percentage of dishonoured instruments cleared under the ECS of all banks.

The ECS allows paperless direct credit and debit transactions for all banks. However, if a bank crosses the limit of instruments dishonoured under the ECS, the RBI asks the respective bank for an explanation.

According to the apex bank, "3%-5% is the tolerance level on a daily basis. At times when it goes up to 30%-40%, we ask the bank to find out about the particular accountholders whose instruments are not being honoured under ECS." Often, banks are not aware about the accountholders who are repeatedly dishonouring their financial instruments as ECS is transmitted in bulk to the clearing house.

The main problem is that even if one of the ECS instruments bounces, then it affects two or three banks at a time. It affects the ECS user bank, the ECS beneficiary bank and the destination bank to which the amount has to finally get transferred.

In a letter addressed to ICICI Bank, a copy of which is with Moneylife, the RBI has said: "Please refer to paragraph 2 of the Minutes of the General Body Meeting of the Chennai Bankers Clearing House (CBCH) held on August 2, 2010 and our letter dated October 28, 2010 relating to return clearing discipline. In pursuance of the instructions contained therein, it has been decided to invoke penalty @Rs. 1000.00 per return for the month of January.

The number of MICR and as well as RECS (Dr) returns of your banks has since been generated from the system and the details are been given in annexure. After deducting the tolerance of 4% and 5% on MICR and RECS returns respectively, a penalty of Rs 39821000.00 (Rupees Three Crore Ninety Eight Lakh twenty One Thousand only) is proposed to be imposed on your bank for non-adherence to the return discipline. You are hereby advised to put forward your case as to why Rs 39821000.00 (Rupees Three Crore Ninety Eight Lakh twenty One Thousand only) shall not be imposed on your bank. Your response should reach this office on or before 15 days from the issue of this letter, failing which it shall construed that you have nothing to report and accordingly the Bank shall proceed with a suitable action."

We gather that several other banks have been pulled up in a similar fashion. Thus, the RBI has defined a definite tolerance level beyond which it would charge a bank a certain fine on each rejection. That is why the RBI has threatened to charge a Rs3.98 crore fine for ECS dishonour beyond acceptable limits on ICICI Bank.

Moneylife spoke to the RBI for clarification. The central bank spokesperson said, "There were several banks that were not adhering to what we call 'return discipline' in Chennai and the notice was issued to all of them. The fine amount, though, varied. The purpose of the show-cause notice was to shake the banks out of complacence and to ensure that the rate of 'returns' fell within our comfort zone (and not really to collect fine amounts from them). There is significant improvement in the position now and we are not pursuing the penalties with the banks."

It was only after receiving the letter from the central bank that banks started screening accounts and transactions and are stopping all ECS debits.

ECS is a mode of electronic funds transfer from one bank account to another using the services of a clearing house. This is normally utilised for bulk transfers from one account to many accounts or vice-versa. This facility can be used both for making payments like distribution of dividend, interest, salary, pension, etc. by institutions or for collection of amounts for purposes such as payments to utility companies (telephone, electricity), or charges (house tax, water tax), etc or for loan instalments of financial institutions/banks or regular investments of individuals.

The ECS user bank is called the 'sponsor' bank under the scheme and the ECS beneficiary accountholder is called the ECS 'beneficiary' bank. The destination account holder's bank or the beneficiary's bank is called the 'destination' bank.

The beneficiaries of regular or repetitive payments can also request the paying institution to make use of the ECS (Credit) mechanism for effecting payment.

User

COMMENTS

Nagesh KiniFCA

5 years ago

It is heartening to observe that the banking watch dog is at long last barring its teeth to bite rather than merely bark as it was doing in the not so distant past.

What will RBI do in case of ICICI, SBI and other bankers who have exceeded their exposure to lending to RIL?

Adi Daruwalla

6 years ago

Why will RBI not take the punitive action? What do you mean that banks are not aware of the account holders who are dishonouring their instruments under ECS? Manager accountholder nexus, no data collected, dont have manpower, these are common excuses. If RBI made the law then enforce it and use it for betterment rather than be lax.

R Krishnamurthy

6 years ago

Normally it is said that ECS credits are done within 3 days. Recently the Income Tax refund of my spouse took more than 3 weeks to get cleared in Bank of India.
The bank says they credit it immediately when the fund arrives. In these cases we as account holders feel helpless since the IT sms says they have sent the ECS on a particular date. The Bank says they have no control over this!

Govind Gopal Shanbhag

6 years ago

Dear Subrata Sir - It is not correct to blame RBI for this mess as it is trying to discipline the banks. RBI has adequate profits they need not stoop so low for such profits. Account holders are also responsible, apart from reason for technical returns (such incorrect name etc.), non maintenance of balance in the account is also the reason due to such high returns. In number of cases account holders give ECS mandate for payment of phone bills, electricity bills, loan instalments and other standing instructions and in number of cases they change the bank accounts rendering the account in operative/ dormant/ inadequate balance. This paper less scheme if implemented property can go a long way in reducing import cost as MICR paper on which cheques are printed is fully imported. In fact there is no much difference between bouncing of cheques for inadequate balance and/or return of ecs mandate and RBI is right in its move to discipline account holders for such indiscipline provided this penalty is ultimately recovered from account holders.

Nagesh KiniFCA

6 years ago

The ECS user banks need to activate their own monitoring systems to monitor their clients who issue cheques indiscriminately without funds and are chronic defaulters, they need to be disciplined with heavy penalties.

Narendra Doshi

6 years ago

I would like to bring a corollary issue to the attention relating to REJECTING of direct credits to account holders especially with Mutual Fund redemptions when there is ANY DIFFERENCE in the Full / Abbreviated name / initials, even in genuine cases (as it seems the existing system probably CANNOT differentiate).My clients have suffered EXTENSIVELY in the last one year due to this.However, it will be a great surprise to you that this has REPEATEDLY happened when HDFC AMC is making redmptions to bank a/cs with NON HDFC banks while it is NOT happening if it is to a HDFC bank a/c!!

S MURALI

6 years ago

The delinquent account holders in turn should be penalised suitably. This measure will not only reduce the return rate but also fake and fraudulent attempts, if any.

Subrata Das

6 years ago

As long as it is not Kite Flying I dont think RBI should intervene.
Maybe that's their way to boost the bottom line. I have not seen any innovative mechanism this RBI FY to cover their trading losses. Or is it a trading profit year ?

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