Citizens' Issues
Govt approves restructuring of I-T dept; creates 20,751 posts
Finance minister P Chidambaram said the recruitment for the additional posts would be done over a period of time and the decision will help the I-T department collect higher revenue and provide better services to tax payers
 
The government on Thursday approved the restructuring of Income Tax (I-T) department, that includes creation of 20,751 additional posts in various cadres, saying it will help increase collections by Rs25,000 crore per annum.
 
“Union Cabinet today approved the proposal for creation of 20,751 additional posts in the Income Tax Department in various cadres that is 1,349 additional posts in the IRS cadre and 19,402 additional posts in the non-IRS cadres,” finance minister P Chidambaram said briefing the media after the Cabinet meeting.
 
He said the recruitment for the additional posts would be done over a period of time and the decision will help the I-T department collect higher revenue and provide better services to tax payers.
 
The move entails an additional expenditure of Rs449.71 crore per annum on creation of additional posts and upgradation of some existing posts, the minister said.
 
“This additional expenditure would be more than compensated by the increased revenue of more than Rs25,000 crore per annum proposed to be generated as a result of this exercise,” he added.
 
According to the information available, the restructuring of the I-T department has recently been approved by a Group of Ministers (GoM) comprising finance minister P Chidambaram, home minister Sushilkumar Shinde, environment and forests minister Jayanthi Natarajan and minister of personnel V Narayanasamy.
 
The GoM was of the view that the revamp plan would result in quicker tax refunds and detection of high networth individuals who escape the tax net.
 
The government plans to collect over Rs6.68 lakh crore from direct taxes in the current fiscal, up from Rs5.65 lakh crore in the previous fiscal.
 
When asked about restructuring of the Central Board of Excise and Customs (CBEC), Chidambaram said a Cabinet note is under preparation and will taken up at appropriate time.
 

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Tata Steel reports consolidated loss of Rs6,528.51 crore loss in Q4
For the financial year ended 31 March 2013, the steel giant reported a consolidated net loss of Rs7,057.62 crore as against a net profit of Rs5,389.77 crore, largely due to the $1.6 billion impairment
 
Tata Steel reported a consolidated net loss of Rs6,528.51 crore for the quarter ended March 2013, as it took a Rs8,355.91 crore one-time impairment on non-current assets, primarily related to its European operations.
 
The Tata group company had reported a consolidated net profit of Rs433.46 crore for the same quarter of 2011-12.
 
Its standalone net profit, which is Indian operations of Tata Steel, also declined by over 16% to Rs1,309.21 crore during the quarter vis-a-vis Rs1,560.51 crore of Q4 of FY12 as it made a one-time provision of Rs686.86 crore on diminution in value of investments/doubtful advances.
 
In a separate statement, Tata Steel said that the performance of its European operations has improved during the last quarter and its quarterly deliveries stood at 3.42 million tonnes (MT) in the fourth quarter compared to 3.02 MT of the third quarter.
 
Noting that the Eurozone crisis has pushed European economy into a recession, Tata Steel said that current steel demand is almost 30% lower than the pre-2008 financial crisis level.
 
“These severely depressed conditions are expected to continue over the short-to-medium term and have led to a downward revision of cash flow expectations and the valuation of the group’s European operations,” it further said.
 
Reflecting these conditions, Tata Steel took an impairment charge of Rs8,356 crore in the last quarter.
 
“This is a non-cash charge and does not affect any of its financial covenants and its funding position. A significant portion of this impairment charge relates partly to the goodwill created on the acquisition of Corus Group plc in 2007...” the company said.
 
The impairment also includes the effect of write down of assets in the ferrochrome business in South Africa and the mini blast furnace in Tata Steel Thailand.
 
Few days back, Tata Steel had announced that it will be taking $1.6 billion non-cash write-off in its financial numbers for the last quarter.
 
The company’s consolidated net sales rose less than 1% during the quarter at Rs34,180.05 crore as compared to net sales of Rs33,860.08 crore of January-March period of FY12 due to subdued steel demand, particularly in Europe.
 
Tata Steel’s net sales in India rose over 13% during the quarter at Rs10,602.88 crore vis-a-vis Rs9,375.91 crore of Q4 of FY12.
 
For the financial year ended 31 March 2013, the company reported a consolidated net loss of Rs7,057.62 crore as against a net profit of Rs5,389.77 crore, largely due to the $1.6 billion impairment.
 
Net profit of Tata Steel’s Indian operations also declined by over 24% to Rs5,062.97 crore in the last fiscal vis-a-vis Rs6,696.42 crore in FY12.
 

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Nomura expects stock market to correct in the coming months

Its proprietary indicator, NESII, or the “surprise indicator”, feels that optimism in the market has gone one step too far and a turning point could be inevitable

 
Nomura expects markets to trend down in the coming weeks, if its “surprise indicator” is anything to go by. According to a note sent to clients, Nomura stated: “NESII is mean reverting, which indicates a rising probability that it will start to retrace back towards zero in the coming months. A falling NESII would indicate that economic data are likely to surprise negatively, possibly because consensus expectations are now too optimistic.”
 
At the moment, the NESII is positive and showing extreme bullishness vis-a-vis surprise and expectations. In other words, the market is beating investors’ expectation which is driving the market upwards. Therefore, there is greater chance for disappointment in the coming weeks which could cause the market to trend downwards. It feels that a turning point in the market is inevitable, based on how much the NESII index has gone up. The note said, “The NESII has been hovering mostly in positive territory since November 2012, indicating positive surprises in activity and inflation data since then. In fact, the NESII crossed the 1 standard deviation band last week.” 
 
It feels that prevailing optimism in the market has gone too far and markets are likely to disappoint in the coming months. According to the note, Nomura’s economic surprise index for India (NESII) captures the direction and momentum in economic data surprises in India. Historically, it has shown a strong correlation with India’s financial markets.
 
Nomura had conceived a new indicator known as Nomura Economic Surprise Index for India (NESII), which is used as a “tactical tool” to gauge key turning points in the stock market. “NESII is a single numerical index which crystallises the relationship between markets and economic data in India, and tracks the direction and magnitude of economic data surprises,” according to Nomura in their first report. We had analysed the report over here (http://www.moneylife.in/article/a-nomura-index-has-72-success-ratio-in-predicting-economic-drift-and-therefore-nifty/29077.html). 
 

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COMMENTS

nitin joshi

4 years ago

good info

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