Share prices lack direction: Monday Closing Report

Nifty should sustain above today’s low to push higher

Worries about a possible debt default by Greece dragged global markets sharply lower today, and India was no exception. The weak domestic industrial output numbers for July also added to the woes. Today, the Nifty opened at 4,982, its lowest opening in seven days. After hitting its intra-day high in the initial session, the index slipped downward to an eight-day low at 4,911. However, the fall happened on low volumes of 59.80 crore shares, which is much below the 10-day average of 63.67 crore shares. Tomorrow, if the index is able to sustain itself above today's low, then the current fall will be curtailed with the market at least making an upward journey.

Weak global cues from Europe and the US over the weekend pulled down the markets in Asia this morning, resulting in the domestic market taking a hit. The Nifty opened trade at 4,982, down 77 points, and the Sensex opened at 16,668, a loss of 199 points. The Nifty touched 4,986 at the intra-day high, while the Sensex opening level was its high of the day. Fears of weak industrial production data for July also added to the fears. IT, banking, metal and auto stocks were on the sellers' radar in early trade.

Offloading by institutional investors saw the indices drift further southwards in subsequent trade. A 21-month low reading of the Index of Industrial Production (IIP) for July at 3.3%, down from 9.9% from the corresponding month last year and 8.8% in June 2011, and a weak opening of the key European bourses added to investors' woes in noon trade.

The market touched the day's low at around 1.30pm, with the Nifty below the 5,000-mark at 4,911, and the Sensex falling to 16,393. While a minor bounce-back was noticed after the benchmarks touched their lows, US stock futures trading in the negative capped the gains. Trading range-bound in the post-noon session, the market closed lower for the second day in a row. At the close, the Nifty fell 113 points to 4,947 and the Sensex tumbled 365 points to settle at 16,502.

The advance-decline ratio on the National Stock Exchange (NSE) was a dismal 379:1359.

Among the broader indices, the BSE Mid-cap index declined 1.84% and the BSE Small-cap index slipped 1.86%.

All sectoral gauges ended in the red with the BSE Consumer Durables index (down 3.43%) leading the pack. Other major losers were BSE Metal (down 3.39%), BSE IT (down 3.27%), BSE Realty (down 3.13%) and BSE TECk (down 3.12%).

Hindustan Unilever (up 3.80%), Cipla (up 1.41%) and Sun Pharma (up 1.24%) were the gainers on the Sensex. The losers were led by Hindalco Industries (down 4.76%), Tata Steel (down 4.63%), Wipro (down 4.56%), SBI (down 4.39%) and Tata Motors (down 4.14%).

The top gainers on the Nifty were Ambuja Cement (up 5.98%), HUL (up 3.65%), Sun Pharma (up 1.80%), ACC (up 0.90%) and Cipla (up 0.68%). The key losers on the benchmark were HCL Technologies (down 7.64%), Reliance Power (down 5.51%), Hindalco (down 5.34%), Reliance Infrastructure (down 5.17%) and IDFC (down 5.14%).

Markets in Asia closed lower on concerns about the possibility of a Greek debt default. The resignation of a key European Central Bank official on Friday implied that a consensus about a broad-based solution to resolve the debt problems is lacking.

The Hang Seng tumbled 4.21%, the Jakarta Composite declined 2.56%, the KLSE Composite slipped 1.56%, the Nikkei 225 tanked 2.31% and the Straits Times declined 2.89%. Markets in South Korea, China and Taiwan were closed for local holidays.

Back home, foreign institutional investors were net sellers of stocks worth Rs427.67 crore on Friday. On the other hand, domestic institutional investors were net buyers of equities worth Rs85.07 crore.

Pipavav Defence & Offshore Engineering Company (formerly Pipavav Shipyard) today said it plans to set up a joint venture company with state-run Mazagaon Dock (MDL) for building warships for the Indian Navy. It is for the first time post-independence that a private sector company has been selected by the defence ministry-controlled PSU to build warships together, the company said in a statement to the exchanges. Pipavav Shipyard jumped 11.63% to close at Rs91.20 on the NSE.

Balaji Amines, engaged in the manufacture of methylamines, ethylamines and derivatives of specialty chemicals, aims to more than double its revenue to Rs900 crore in the next three years. It has also set a target to derive 50% of its sales from exports over the next 2-3 years on the back of increasing demand for specialty chemicals in the global market. The stock added 0.43% to Rs35.20 on the NSE.

Larsen & Toubro (L&T) has bagged an order from Reliance Power for implementing part of the 100MW solar PV plant at Pokaran in Rajasthan. The order is valued at about Rs4 crore per MW. L&T has been entrusted with the task of setting up the plant for the power major. The L&T stock settled at Rs1,645, down 2.81% on the NSE.


Govt to consider DLF’s plan to sell Pune SEZ, next week

Besides the DLF proposal, the BoA will consider requests for extension of time from 44 SEZ developers, including Mukesh Ambani-promoted Navi Mumbai SEZ and Raheja SEZ for implementing their projects

New Delhi: India's largest real estate firm DLF's proposal to sell its stake in IT/ITeS Special Economic Zone (SEZ) in Pune to foreign investors will come up for consideration of the high-level government panel on 19th September, reports PTI.

The proposal of DLF Ackruti Info Parks (Pune) for sale of shares to foreign investor will be "placed before the Board of Approval (BoA), headed by the commerce secretary," an official said.

Private equity major Blackstone is likely to buy the entire 100% stake in the 11.83 hectare SEZ in Pune, sources said.

DLF has 70% stake in DLF Ackruti Info Parks (Pune) and remaining stake is with Ackruti City.

Earlier, the Department of Revenue had opposed the proposal stating that the transaction would amount to sale of land, which is not permitted under the SEZ Act and rules.

The matter was referred to the law ministry which has given its nod to the proposal, contending that the "change in equity structure through transfer/sale/amalgamation and consequent change in the management cannot be treated as transfer or sale of land which will continue to vest in the company".

However, the decision has been left to the BoA which will meet next week. Presided over by commerce secretary Rahul Khullar, the BoA comprises senior officials from the Department of Revenue, law ministry and other concerned departments.

DLF plans to raise about Rs7,000 crore in next two-three years through sale of non-core assets to reduce its debt of over Rs20,000 crore.

Besides the DLF proposal, the BoA will consider requests for extension of time from 44 SEZ developers, including Mukesh Ambani-promoted Navi Mumbai SEZ and Raheja SEZ for implementing their projects.

The extension of time has been sought in the backdrop of slowdown in the real estate and problems relating to land acquisition.


TDS matter continues to be an irritant for bank customers

Account holders complain banks do not give TDS certificates on time, tax deducted not credited to tax credit account 

The Reserve Bank of India recently announced that banks must issue duly completed tax deduction at source (TDS) certificates for account holders and dispatch it to their mailing addresses. But, customers continue to face many problems on this account.

Many customers complain that they are not getting TDS certificates from the banks and often, such certificates do not match with the 26AS statement of the income-tax (I-T) department. Currently, the I-T department relies on TDS certificates issued by banks only if it matches with the information contained in form 26AS on the income-tax website. If there is a mismatch, the taxpayer may not get a refund of tax that's claimed.

One Moneylife reader says: "Banks issue TDS certificates on the interest earned on term deposits, but this has not been credited to the tax credit account of the depositors in most of the cases. This results in non-refund of tax claimed by the taxpayer through filing of returns with the TDS certificate issued by the deductor."

Moneylife has repeatedly pointed out that TDS has been nothing but harassment for bank customers and taxpayers.

"When the PAN (number) of an account holder is not available, tax is recovered at 20%. But when TDS is recovered at 10%, it means that the PAN of the account holder is available. The bank is duty bound to update your recovery, so that the same is visible in your AS26," another reader writes. "Usually this step is not taken care of, and a bank is bound to update this when it is brought to its notice by the account holder. However, the experience is that there is no misappropriation under TDS recovery in public sector banks."

According to a banking and financial consultant, though it is mandatory for banks to send the TDS certificates to depositors every quarter without their asking for it, barring a few banks, none of the major banks bother to send this. Another problem depositors' face is that different banks follow different systems for payment of interest and deduction of tax at source. Many banks just credit the net amount of interest after deducting tax, due to which the depositor will not know the amount of tax deducted till the TDS certificate is issued by the bank.

Another reader said that many banks deduct TDS on the accrued amount instead of the paid amount. "One of the problems in connection with TDS on bank deposits is TDS on accrued amount instead of paid amount. Kotak Mahindra Bank has been deducting TDS on the assumed accrued interest in case of sweep / Flexi fixed deposits, even when the net amount earned is below the TDS threshold. The sweep FD is generally utilised for a temporary period to earn little higher interest than on the savings account. The same amount may be withdrawn at any time based on the need. But the bank deducts TDS on the total amount calculated for the entire tenure of the deposit even though the amount may be withdrawn in full or part during the financial year. This is unjust and unfair on the part of the bank," he says.

Moneylife Foundation recently sent a memorandum on the TDS matter to the finance ministry and the Reserve Bank of India (RBI). The memorandum to the RBI highlights the TDS problem for bank depositors and suggests that income from fixed deposits should be exempt from tax. It also proposes that banks found to be deficient in services, like deducting tax wrongfully, not providing accurate tax certificates, or uploading inadequate or wrong information, should be awarded exemplary punishment, either by the banking ombudsman or the RBI. (Read, 'Moneylife Foundation sends memorandum on TDS to the FM, RBI'.)



subrahmanian s h

5 years ago

Another example:

And this month too I have received pension of Re 1 more !(than the reduced amount of Rs 21441)
credits: 30/05 21563
credits: 28/06 21441
credits: 30/07 21441
credits: 30/08 21441
credits: 30/09 21442

Subrahmanian S.H.
Reply fro SBI:

[email protected] via
9 Oct (7 days ago)
to mani

Dear sir,

We have to advice that discrepancy in pension is due to TDS deducted at source as per govt income tax instruction.

Sir, you have to update KYC of SB pension a/c 10843825430 ,PLEASE VIST THE BRANCH WITH YOUR PAN CARD AND RESIDENTIAL PROOF


We will give you pension paymnt details when you visit the branch

service manager
SBI Mulund (west),

S H Subrahmanian

6 years ago

Improvement in banking service is need of hour. Banks have increased service charges to extreme levels but have never bothered to improve standard of service towards customer.
Often the emails sent by me are mostly not replied by Banks.
It’s the onus of banks and income tax dept. to ensure the correctness and correlations. Whatever other parameters it sets the onus of matching TDS to tax paid/mismatch to the computer systems! Income tax's post-return of extra tax is stupid exercise wasting time, making it hell to customers due to negligence by banks/others
Now RBI has warned the Banks to be more responsible to the customers. I was told that the TDS certificates have already been sent long back which I never received for any of the eight accounts. How can all the certificates go missing? The probability is that they were never sent. When asked for the proof of delivery, it came to be known they had been sent by ordinary post!
Not that kind-Hearted have vanished altogether. We have had pleasant experiences too. While closing many SCQIS at SBI, Mulund, Mumbai a few months back, documents were not found properly filed. There was a big crowd. Though we (Sr Ctzns) had to remain in the branch for the entire day, the kind officer(s) a few months ago attended to me, asking me to dig out relevant papers. But for that I would have to face heavy problems/ possibly losses! It was all the more important that I could reinvest the produce in FDs with more than 10% interest – a plan that was pending for long.!
I would happy as and when RBI makes it mandatory in banks having the “Nomination details” part of KYC.

S H Subrahmanian

6 years ago

My personal experience:
The 'ill famous SS Saving Scheme: Bonus vanished and interest reduced by the same Chidu, who introduced the scheme. Also, tax became a fact, though introduced as tax free. And, for instance, I found, when continuing a Certificate for Rs 50,000 last year, the principal becomes only
Rs 46,000. The reason: A Tax Deduction of "The difference 4,000" for the year 2009. And no TDS was issued to me ever....! This is despite my submitting 15H regularly.

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