Govt foodgrain stocks at 50.2 million tonnes on 1st Sept, says FCI

New Delhi: Foodgrain stocks held in government godowns stood at 50.2 million tonnes at the start of the current month, according to latest data from the Food Corporation of India (FCI), reports PTI.

FCI, the nodal agency for foodgrains procurement and distribution, had 20.4 million tonnes of rice and 29.8 million tonnes of wheat in its storage facilities as of 1st September 1, a senior official said.

As per government norms, the FCI should have 26.2 million tonnes of wheat and rice available in its buffer stock as of 1st October. This includes 5 million tonnes of strategic reserves.

The Centre has created a strategic reserve of three million tonnes of wheat and two million tonnes of rice over- and-above the normal buffer stock.

The government is sitting on a huge foodgrains stocks and is grappling with a storage problem. It is also not allowing exports of wheat and non-basmati rice due to high food inflation and to meet the requirement of foodgrains for the proposed National Food Security Act.

The higher stock availability is on account of bumper output and procurement in the last two years.

India produced a record 80.71 million tonnes of wheat in the 2009-10 crop year (July-June), beating the previous year's record of 80.68 million tonnes.

On the back of record output, FCI has so far procured 22.5 million tonnes of wheat in the 2010-11 marketing year (April-March), compared to a record 25.1 million tonnes last year.

In the case of rice, the country's production declined to 89.13 million tonnes in the 2009-10 crop year from a record 99.18 million tonnes in the previous year on account of a drought that hit over half the country.

Rice procurement in the 2009-10 marketing year (October- September) will continue till the end of this month and so far, the FCI has procured 30.9 million tonnes of rice against 33.08 million tonnes in the year-ago period.


SC notice to Centre, Raja on CBI probe into 2G spectrum

New Delhi: The Supreme Court today asked the Centre and Union telecom minister A Raja for a response on a plea urging the court to monitor a Central Bureau of Investigation (CBI) probe into alleged irregularities in the 2008 sale of second generation (2G) spectrum licences, reports PTI.

A bench comprising Justices G S Singhvi and A K Ganguly sent notices to the telecom ministry and Mr Raja and asked for replies within 10 days.

The bench also issued notices to the CBI, Enforcement Directorate and Income Tax Department on the petition filed by the Centre for Public Interest Litigation (CPIL), an NGO, and others.

The petitioners challenged the 25th May decision of the Delhi High Court dismissing its plea to monitor the CBI probe into the alleged role of the Union communications minister in the sale of 2G spectrum licences in 2008.

Advocate Prashant Bhushan, appearing for CPIL, alleged that despite having documents showing an alleged nexus between Mr Raja and others, the CBI was not going ahead with the probe in the matter.

The petitioners alleged that the Department of Telecommunications (DoT), under the ministership of Mr Raja, had given away 2G spectrum to 122 operators at a throwaway price of Rs 1,658 crore for pan-India licences on a first-come-first-served basis in January, 2008.

Mr Raja was expected to take the auction route for allotting the 2G licences to telecom service providers, they said.


Other cross-border deals like Vodafone under tax lens: Finance ministry

New Delhi: Tax officials are scrutinising other cross-border mergers like the Vodafone-Hutchison deal for possible tax evasion after the Bombay High Court rejected a petition against imposition of tax on the deal, reports PTI quoting a key finance ministry official.

"We are in the process of investigating other cases. They are also in various stages of processing," Central Board of Direct Taxes chairman S S N Moorthy told reporters on the sidelines of an Associated Chambers of Commerce and Industry (Assocham) seminar here.

Mr Moorthy, who was abroad when the court delivered its verdict on Thursday, said the tax department will abide by the order and not proceed with any tax notice on Vodafone before the expiry of eight weeks.

Earlier, tax authorities had slapped a show-cause notice on Vodafone, asking the company why tax should not be imposed on its acquisition of Hong Kong's Hutchison Telecommunications stake in Indian telecom JV Hutch Essar for over $11 billion in 2007. Sources said that tax on the transaction could amount to as much as Rs12,000 crore, including interest.

The tax authorities said that in this case, the buyer, Vodafone, was liable to pay capital gains tax even if it failed to deduct it at source while making payment to Hutch for the deal that happened overseas. Vodafone challenged the notice.

However, the Bombay High Court ruled on Thursday that the Income Tax Department has the jurisdiction to levy tax on Vodafone, even though the multi-billion dollar deal was signed outside the country.

The court has, however, asked the tax department not to act on its tax order for eight weeks.

"We will abide by the high court order. So, we will not take any action till the time given by the high court," Mr Moorthy said.

He said after the expiry of eight weeks, the next step will be taken, which is "of course, the issue of notice."

Mr Moorthy refused to specify which deals are being investigated by the tax department to check duty evasion.

Sources, however, said the court order may have a bearing on deals like the SABMiller-Foster and Sanofi Aventis-Shanta Biotech transactions.

The second largest brewer in the world, SABMiller, had acquired a 100% share in the Indian arm of Australia- based Foster.

Similarly, French drug-maker Sanofi Aventis had picked up a majority stake in Indian vaccine company Shantha Biotech in 2009 for around $770 million.

Recently, the London-listed Vedanta Group signed a deal to acquire up to a 51% stake in UK-based Cairn Energy's Indian arm for as much as $8.43 billion.


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