THE HINDU BUSINESS LINE
Financial Daily
from THE HINDU group of publications

Saturday, July 28, 2001

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Opinion

Economy
Course of corporate profit rate in US
THE Bureau of Economic Analysis of the US periodically presents data on national income, capital stock, international investment position, and so on. With some of the best technical economic experts on its staff, it regularly publishes surveys of the cur rent businesses of the US. The information is also up to date.

Editorial
Welcome WTO steel ruling
THE RECENT RULING by a WTO appellate body that the US had acted illegally in increasing duties on Japanese steel imports should be seen as a shot in the arm for a host of steel exporters penalised in recent times by the US Administration on dumping groun ds. Indeed, going by the specifics of the case in hand -- namely, that the US Administration had not acted as per the WTO rules when it levied the anti-dumping charges after ``refusing to consider information from three Japanese steel companies because t heir submissions had arrived late'' -- the outlook for roughly similar complaints lodged by other steel exporters, including India, has turned decidedly bright.

Fertilisers
LNG: No panacea for fertiliser woes
FOR almost two decades, natural gas has occupied the centrestage in the Indian energy scene in view of its being the most preferred feedstock/fuel in various industries. This is mainly due to the lower investment required for setting up plants based on g as vis-a-vis other sources of hydrocarbons, such as naphtha, fuel oil, LSHS and coal, on the one hand, and the lower energy consumption, on the other. Its being a clean fuel, and therefore environment-friendly, further adds to its charm.

Politics
After Agra
THAT the Agra Summit would not deliver favourable results for New Delhi was a foregone conclusion -- even when the Prime Minister, Mr Vajpayee, sprang his `Summit surprise' on the nation on May 23. (Incidentally, since it was a total surprise, there was no question of the Prime Minister having consulted `important people' before the decision was taken, as is now being clarified in defence of the decision.) Clearly, the basic reason for the Summit's utter failure from the Indian point of view was the tot al absence of any conditions at the `ground-level', so to speak, for not just the success of the Summit but also holding one in the first place.

Taxation
Foreign food
A RECENT Customs circular focusses on the testing of food items before Customs clearance so as to ensure that the Prevention of Food Adulteration Act is not violated.

On the fringe of unfairness
T. C. A. Ramanujam says that the new rules for valuation of perquisites go against the recommendations of the Chelliah Committee.

Income from unapproved investments -- Not all is lost for trusts
WHERE a charitable trust earns income by virtue of the provisions contained in Section 13(1)(c) or (d), then that relevant income is chargeable to tax at the maximum marginal rate. Section 13(1)(c) deals with any part of the income of the trust enuring f or the benefit of certain categories of persons. The persons include author or founder of the trust or institution, members of his family, relatives of the author, founder, trustee, manager or any concern in which they have substantial interest.

Nuts and bolts -- II
A TAX deduction is recognised as a tax expenditure or subsidy which should be available only in respect of disclosed income. Those who come to the Revenue with unclean hands cannot obviously demand a tax incentive from it.

Deadline thoughts
THE Income-Tax Act, 1961 relies upon voluntary compliance on the part of taxpayers to meet their obligations. An obligation for filing returns exists merely because they may have taxable income, even if they do not have any tax to pay, especially when ad equate tax has been deducted at source. Even when they may have no taxable income, returns have to be filed if they satisfy any one of six rules: have more than the specified area under occupation of immovable property, whether as owner or tenant, within the notified city or town; own a motor vehicle; subscribe to a telephone; have incurred expenditure on foreign travel; hold a credit card; or are members of a club with entrance fees of Rs 25,000 or more. Senior citizens are exempted from two of the six criteria -- occupation of minimum space in area and owning a telephone.


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