Finance minister chastises car companies
New Delhi: Mr. Yashwant Sinha, the finance minister has termed the behaviour of the automobile industry as extremely ‘irresponsible’. He said that the industry which has received a boost in the current budget with the excise duty been reduced have resorted to raising the car prices, instead of passing the benefit of such duty reduction to the consumer.

The minister hoped that the industry would behave more responsibly, and use this to augment demand rather than to make short-term profits.
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Delhi to appeal for relaxation in CNG permit norms
New Delhi: Its inability to cope with the enormous rush from transport vehicle owners seeking new permits and the growing discontent among the general public, the Delhi government filed an application in the Supreme Court on Monday seeking relaxation of the mandatory permit norm for buses.

More than 2,000 buses have been unable to ply on the roads despite placing orders either for a new CNG bus or a CNG kit. The government has pleaded that those, who had already filed affidavits before March 31 indicating that they placed orders for conversion of their vehicles into CNG or other cleaner fuel mode, be allowed to operate their present vehicles for seven days without the new permit.

The government was seeking relaxation of the norm for seven days in order to complete the process of issuing the new permits and to mitigate the sufferings of commuters.
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Boom in hotel construction in India
New Delhi: Six new luxury hotel projects within a kilometre from the international airport of Mumbai, with their clatter of excavators and drilling machines, speak a lot of the current boom in the hotel construction in the country.

The boom will add more than 4,000 rooms over the next five years just in Mumbai, more than doubling the number of luxury hotel rooms in India’s financial and entertainment capital.

The Mumbai market, long dominated by the Taj and Oberoi groups, will now witness the Hyatt, Rennaissance and Marriot chains invading their turf. These hotels join a long list of 21 new properties that are under construction in various parts of Mumbai.

In addition to this there is an amazing 110 branded hotel properties are coming up throughout India in the next four years. The new hotels will add nearly 10,000 rooms, one-third of India’s existing room capacity in the branded hotel category.

A surge in business travel brought about by the ongoing liberalisation in the country, coupled with changing lifestyles of a spendthrift middleclass population, has been largely responsible for this boom.
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IRDA to revise agency commission structure
Kolkota: The insurance industry regulator, Insurance Regulatory and Development Authority, has set the ball rolling by revamping the two-decade-old agency commission structure in the industry. In the process it has also brought in a large portfolio of businesses within the ambit of such commission.

This apart, it has pegged the tariff and non-tariff commission at 5 per cent and 15 per cent respectively. This structure to be enforced shortly, is expected to give a boost to the entire agency system and make it’s the focal point of business generation for insurance companies.

The IRDA has undertaken a major decision to withdraw the practice of granting special discount in lieu of agency commission.

Tariff business, which includes mainly fire, engineering, marine hull and motor insurance, constitutes the major chunk of insurance business.

This move of the IRDA appears to be a precursor to the advent of corporate agents and branch into the insurance areas for which clear-cut guidelines is yet to be announced.
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CBDT shocks bank no VRS write-off
New Delhi: Public sector banks which have laid off large number of people under their VRS schemes got a last minute shock when the Central Board of Direct Taxes came out with a guideline preventing the banks from writing off the VRS payments as expenses in their books.

While the banking industry views this directive as a desperate bid to improve tax collections, officials of the CBDT state that VRS monies cannot be treated as a regularly occurring revenue expenditure.

Banks like Canara Bank, Bank Of Baroda and Oriental Bank of Commerce, among others, who had treated the VRS sum as an expense in this financial year are likely to be hit hard.

Earlier, RBI came out with the regulations for keeping VRS expenditure out of the deductions from tier I capital for arriving at the capital adequacy requirement), thus saving PSU banks’ profit and loss account and balance sheet from turning red.
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