I am a regular reader of Moneylife. It is an eye-opener to investors. I would like to narrate my bitter experience with Shriram Transport Finance Company’s NCD (non-convertible debentures) issue. I applied for NCD issue (5) of the company in July 2013. I applied for 20 NCDs under Series 1 (i.e., interest payment every year, for 36 months). I got the allotment under Series IV (i.e., interest payment at the end of maturity period of 36 months - cumulative scheme). I was surprised to note the allotment. I took up the matter with Integrated Enterprises (India) Ltd, registrars to the issue. They replied to me as follows: “As per SEBI regulations the BID data will be considered for formalisation of allotment. No scrutiny of physical application is made. It is the responsibility of syndicate member to capture all relevant fields.”
Despite my repeated mails to the registrars to the issue and the issuing company, they have not agreed to change the series. I have sent a complaint to SEBI’s regional office at Chennai on 22 August 2013. I have yet to get their response.
I do not understand the purpose of the application submitted and the option selected under the scheme. If the allotment is as per the wishes of the syndicate member, the entire purpose gets defeated. If the syndicate member commits a mistake in selecting the series, why should the applicant suffer?
Finally, the registrars to the issue have suggested the disposal of NCDs in the market, if the selection of series is not in my favour. Is this the way to treat an investor? I require allotment as per my option and not as per their choice. I request you to kindly look into the issue and render assistance in resolving the issue.
RM Ramanathan, by email
Eradicating Fake Currency
I am from Vijayawada in Andhra Pradesh. I appreciate Moneylife’s efforts in bringing to light the facts in many cases and informing people about their infringed rights in getting their claims.
Your recent Cover Story on “Wake Up to Your Bank Charges” (Moneylife, 5 September 2013), based on the survey conducted by Moneylife, focused on problems faced by the public, and, in fact, shook them out of their complacency. But, unfortunately, the article left out an important point which I would like to focus on. Please take necessary action and pressurise the regulator to take swift and stringent action. Banks are hiring or using private security agencies for loading currency notes in ATMs which is causing agony to consumers in many ways:
There is every chance of some private agencies putting in fake notes in the ATMs and what is most shocking is that banks are not claiming responsibility for these issues.
Soiled, damaged and tampered currency notes are being kept in ATMs. The customer has to struggle to get such notes exchanged.
It is shocking that there is not even a single complaint book kept at ATM centres. In some ATMs centres, it is hard to find even security guards.
I request Moneylife to highlight this issue before the regulatory authorities for the benefit of the customers which will help in eradicating fake currency.
Suresh Kumar, by email
Deduction of Education cess
It is observed from the tax deduction at source (TDS) certificates received from some public/ private sector bank branches for interest on fixed deposits that only income-tax @10% has been deducted; education cess @ 3% on income-tax has not been deducted by them for FY12-13. On inquiring about why they are not deducting education cess, the concerned bank branches plead that tax has been deducted as per the system/ instructions from the head office.
Before filing the income-tax return for the assessment year 2013-14, the assessee has to deposit the education cess amount. Else, there will be tax dues and the return cannot be uploaded. If there is a delay in payment of education cess, it may be subject to interest / penalty. To obviate this, the system of banks should also provide for deduction of education cess along with deduction of income-tax on interest on fixed deposits.
I request you to take up the matter with the concerned authorities for corrective action for the benefit of all.
CN Modi, by email
I came across an article from Moneylife (“Multi-Level Marketing: Con Quest” dated 26 November 2012 by Sucheta Dalal) on the Internet and I found the arguments against MLMs (multi-level marketing schemes) valid, especially Qnet.
I recently got in touch with a few Qnet ‘guys’ who said that they are doing business with the potential to earn crores of rupees. I requested them to explain their business model to me, so that I can think about it. But they just asked me to get mentally prepared first and convince them about why I would like to join Qnet and earn. I found it a stupid approach.
Anyhow, I had a meeting with them and came to know that it is just an MLM, wherein one has to put in some money and get someone else to join them and then recover the money. The more people you can enrol, the more you earn. For that, they just give super-motivational speeches, talking especially about success stories. They create insecurities about your future and give you an assurance about your safe future with them. This is done to lure you to invest in their business. It is very natural for someone to fall into their trap.
I already hated the MLM concept and so I saved myself from falling prey. I feel that such concepts and practices should be completely banned in India. Anything you can do to stop these practices would be great. These Qnet ‘guys’ normally have a meeting almost every evening in a coffee shop in Bandra (Mumbai).
A Reader, by email
Spreading Financial Literacy
I sincerely convey my thanks to A Soorianaryanan (letter to the editor, Moneylife, 19 September 2013) who has enlightened me and the readers on the nitty-gritty of e-filling of income-tax returns and its implications, particularly on salaried taxpayers. This was in response to my letter (Moneylife, 25 July 2013). I fully endorse his comment that Moneylife is doing a wonderful job of spreading financial literacy through the magazine. The magazine is also performing yeoman service in different areas to educate and enlighten readers by regularly conducting workshops on various themes without any charge. I wish and hope that the Moneylife team, under the able guidance of its founders, will continue to assist the retail investor community in taking the right decisions to build up their asset portfolio.
Ramesh Kapadia, by email
Attitude of SEBI Employees
This is with regard to “SEBI’s warped ideas about PMS data disclosure”. This proves the point that SEBI exists solely to further the interest of brokers and vendors of financial products who cheat investors across different platforms. It is the brokers and the bankers who control SEBI. SEBI cares a damn about investors. Even the disclosure that is happening, thanks to Moneylife, is so short of what the market needs. SEBI is truly the biggest enemy of investors.
This is with regard to “SIP in Bond Funds” by Jason Monteiro. If, over five years, the average return is 6%, then one is better off investing in fixed deposits for five years. Even at the highest tax bracket, for 9% return, one would have a guarantee of 6% return. Good analysis.
This is with regard to “Infosys explains why MCA21 has issues”. Great work by Moneylife to get this information. Congratulations!
This is with regard to “India does not have structural problems: Raghuram Rajan”. Refreshing pragmatism indeed! Expectations are building up around Dr Rajan. We needed someone who will speak out without fear of loss of votes or his/ her own job. I think that person has arrived.
This is with regard to “NSEL fiasco: When protestors arrive in BMWs, Mercs!”. The fact is that there are many UHNIs (ultra high net worth individuals) among the protestors arriving in limos. This should lead the tax and enforcement authorities to investigate into the sources of the monies put in by some of the top investors and actors. It is sure to take them to the role of questionable funds, notwithstanding KYC.
Bulk Deposits Gathering
This is with regard to “Domestic mutual funds show slight improvement in equity flows”. When 78.94% of the assets are under fixed-income category mostly mobilised from banks, corporates and institutions, how can it be called mutual funds industry? ‘Bulk deposits gathering industry’ would be an appropriate description.
Laws are never Implemented
This is with regard to “Corporate deposits: A better deal?” by Jayant Thakur. In India, what is the point in the government making laws, or having public discussions about laws? These laws are never implemented.