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STRICTER PENALTIES FOR CALL DROPS

NEW DELHI: Telecom regulator Trai has increased the penalty for call drops and imposed stricter financial disincentives, running up to Rs 10 lakh if poor consumer services are provided for three straight quarters.

The measure comes nearly one year after Trai’s move to award compensation to consumers for every dropped call was quashed by the Supreme Court. “We have proposed financial disincentive in the range of Rs 1-5 lakh. It is a graded penalty system depending on the performance of a network,” Trai Chairman RS Sharma said.

SK Gupta, secretary in the regulatory agency, said that if an operator fails to meet the call-drop benchmark in the second consecutive quarter, the penalty amount will increase by 1.5 times, and in the third consecutive quarter, it will be doubled. “There is cap of Rs 10 lakh on financial disincentive,” Gupta said.

Consumers are, however, critical of the way Trai has implemented the norms. Data was not immediately available on action initiated by the regulator on the failure of operators to meet its laid down norms.

Under the earlier Quality of Service Rule, penalty on call drop was Rs 1 lakh for the first violation, Rs 1.5 lakh for the second consecutive one, and Rs 2 lakh for three straight quarters.

CHAIRMAN MULLED STEPPING DOWN FROM BOARD THRICE

BENGALURU: Infosys chairman R Seshasayee said he contemplated stepping down thrice in the last 18 months since the spat between the board and the founders, led by founder N R Narayana Murthy, became public but resisted as he felt such a decision would not mitigate any issues.

Murthy has been scathing about the board since the beginning of this year, alleging a slip in governance standards on issues ranging from former CFO Rajiv Bansal’s severance package and appointment of Punita Sinha as independent director to suspicions about the real motive behind the Panaya deal and the decision to raise CEO Sikka’s pay last year by 55%.

“If that is going to solve the problem, I will be first to do so now. And I make this public that I have asked myself this question and I have asked my colleagues in the board this question not once, not twice but three times in the last 18 months,” Seshasayee said in a news conference on Friday .

The former Ashok Leyland chief, who retires as chairman next May , said it was unfortunate that Sikka decided to leave despite the support from the board. “The core of this is not about if the investigation re port has to be made public, the core of the problem is this ques tion if there was a mis deed. That has hurt him,” he said. He explained that the company responded to whistleblower complaints about the acquisition of Panaya, which got linked to former CFO Rajiv Bansal’s severance package, leading to a perception that it was hush money. The law firm Infosys appointed to look into these allegations gave it a clean chit.

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UB HOLDINGS SHARED TO BE SUSPENDED FROM TRADING

BENGALURU: Shares of United Breweries Holdings Ltd (UBHL) will be suspended from trading with effect from Sept 8 in the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) due to non-compliance with financial results and non-payment of fines for two consecutive quarters, the bourses said on Thursday.

Also, the entire promoter shareholding of the company has been frozen with immediate effect. The promoter and promoter group, led by former liquor baron Vijay Mallya, holds 52.34% of the company, as per the latest disclosures made by the company in December.

UBHL, which has ordered by the Karnataka High Court to be wound up, had failed to report its quarterly results for the three months ended December 31, 2016 and March 31, 2017, respectively. In case the company complies with the requirements before September 4, then the proposed trading suspension would not be imposed, BSE said.

The company had informed the BSE in June that information required to prepare the financial results is no longer with the company due to search and seizure conducted by the Central Bureau of Investigation (CBI), related to the probes on Mallya. Accordingly it requested market regulator SEBI to relax the strict enforcement of the regulations under the extraordinary circumstances.

The suspension would continue from September 8 till the firm complies with the requirements. “Revocation of suspension would be subject to the companies further complying with the procedure and all extant norms prescribed for revocation of suspension,” the notice said.

BAD LOAN LEVELS UNACCEPTABLE, STATE BANKS NEED RECAPITALISATION: URJIT PATEL

MUMBAI: Reserve Bank Governor Urjit Patel on Saturday called for recapitalisation of state-run banks to help them resolve the NPAs issue in a time-bound manner as bad loans at 9.6 per cent of the system is not acceptable.

“Gross NPA ratio of the banking system at 9.6 per cent and stressed advances ratio at 12 per cent as of March 2017 on the back of persistently high ratio in the past few years, is indeed a matter of concern,” Patel told a gathering of bankers and industrialists in the presence of finance minister Arun Jaitley.

Admitting that the balance sheet of most state-run banks are not healthy enough to take large haircuts, which is a corollary of any bad loan resolution, he called for their recapitalisation.

“NPA resolution would necessitate a higher re- capitalisation of these banks,” he said, adding “Government and the RBI are in dialogue to prepare a set of measures to enable state-run banks to shore up the requisite capital in a time bound manner.”

Regulatory or rather the economic challenge in dealing with the NPA issue gets accentuated when seen against the capital position of some of the banks, particularly public sector banks, he told an insolvency summit, hosted by industry lobby CII and chaired by Jaitley.

The RBI chief said as much as 86.5 per cent of GNPAs are accounted by large borrowers.

“Swift time bound resolution or liquidation of stressed assets will be critical for delogging the balance sheet and for efficient reallocation of bank capital,” Patel said.

The government and the RBI are working together to comprehensively address the issue through a multi-pronged approach, he added.

Stating that the success and credibility of all the NPA resolution efforts will be critically contingent on the strength of public sector banks’ balance sheets to absorb the costs, he said any resolution will involve deep haircuts.

“It is clear that state-run banks will need to take haircuts on current exposures under any resolution plan agreed within or outside the IBC. Higher provisioning requirements on this counts as well as other factors will affect the capital position of several banks,” he said.

The measures could include a combination of capital raising from the market, dilution of government holding, additional capital infusion by the government, merger based on strategic decision and sale of non-core assets.

The RBI chief also blamed lenders for the mess, saying their poor credit appraisal systems have led to the pile of bad loans, which tops over Rs 9 lakh crore now.

NEW RS 50 NOTE TO HIT MARKET SOON, OLD NOTE TO CONTINUE

NEW DELHI: A new fluorescent blue Rs 50 banknote in the Mahatma Gandhi series, slightly smaller and slimmer than the existing note will soon be introduced by the Reserve Bank of India.

All earlier notes will also continue to be legal tender. The dimensions of the new note will be 66mm x 135mm. While the height is the same as the new Rs 500 and Rs 2,000 banknotes which were issued after demonetization, the width is lesser than the Rs 500 banknote.

Besides the colour and the dimensions, a unique feature of the new banknote is the motif of Hampi with the chariot and the Swachh Bharat logo with the slogan on the reverse.

The RBI on Friday disclosed the new-look Rs 50 note and provided details of the new security highlights. The announcement came after images of the new note started doing the rounds on social media. The central bank, however, remained mum on the Rs 200 note, which has also been cleared according to sources+ .

The banknote will also have a windowed demetalised security thread with inscriptions ‘Bharat’ (in Devnagri) and ‘RBI’.

The existence of two types of banknotes of the same denomination will make it complicated to dispense them from ATMs. However, this will not be a major issue as most banks have stopped dispensing Rs 50 notes in ATMs according to Navroze Dastur, CEO, NCR India. “If the Rs 50 note has to be dispensed from ATMs there will have to be separate cassettes for new and old notes,” said Dastur.

NO INCONSISTENCY IN NUMBER OF TAX PAYERS: CBDT

New Delhi, Aug 18 () The tax department said the number of individuals filing income tax returns has jumped to 2.79 crore this year from 2.23 crore last year, matching with the 56 lakh new tax payer addition stated by Prime Minister Narendra Modi.

The statement by the tax department follows some doubting the numbers over different figures quoted at different points of time.

“The Prime Minister’s speech (on August 15) referred to the increase in number of e-filed Personal Income Tax Returns (ITRs) filed from April 1, 2017 to August 5, 2017 over the ITRs filed in corresponding period of earlier years.

“The data maintained by the Income Tax Department shows that during April 1, 2017 to August 5, 2017, 2.79 crore e- returns of individual taxpayers were received as against 2.23 crore e-returns received during April 1, 2016 to August 5, 2016. Thus, the additional ITRs received in 2017 works out to be 56 lakh,” CBDT said in a statement.

In 2015, 2 crore e-returns were received. This meant that 23 lakh additional tax payers filed returns in 2016.

A top finance ministry official said the people are trying to find fault where none lies.

“The CBDT had in a press statement on August 7 released the very same numbers and what the Prime Minister said in his independence day speech was exactly in line with that,” he said.

Regarding the Economic Survey Vol.2 released on August 12, mentioning of 5.4 lakh new taxpayers, he said on page-22 of the report it is clearly stated that the numbers are for the period November 8, 2016 to March 2017. “This means they are the additions made in tax payers post demonetisation in the previous year.”

On the 33 lakh new taxpayer number given in reply to a question in Rajya Sabha on August 1, he said that information was dated and not the complete information, which came only after the last date of filing of returns ended on August 5.

“There is no inconsistency in the data provided by the Government in the (different) statements… as these are in different contexts and for different time periods,” the tax department statement said.

On Finance Minister Arun Jaitley’s May 17 statement, the CBDT said: “The addition of 91 lakh taxpayers to the tax-base referred to the total number of new returns filed during the entire financial year 2016-17 and therefore, it is neither comparable to the data in Prime Minister’s speech nor with the data in Economic Survey (different period and different type of taxpayers).”

It added that the number of tax filers is likely to “rise significantly” above the 2.79 crore returns e-filed as “many more taxpayers are still to file their returns”. JD ANZ SA

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ENGINE ISSUES GROUND 12 INDIGO PLANES, MANY FLIGHTS HIT; AIRLINE SAYS FLYERS GIVEN OPTIONS

NEW DELHI: India’s largest domestic airline IndiGo is now reeling under the impact of unending snags on Pratt & Whitney’s (PW) engines powering the Airbus A-320 new engine option (NEO). As many as eight NEOS of IndiGo are currently grounded due to engine trouble, forcing the airline to cancel hundreds of flights in past few weeks and accommodate passengers on other flights.

An IndiGo spokesman said: ” At present, eight NEOs are grounded because of the unavailability of spare engines. These have already been factored in our revised schedule which was finalized in June and there are no additional flight cancellations on account of these Neos. Our schedule was planned in June itself pertaining to non-availability of these aircraft for the month of July, August and September. The affected passengers have already been accommodated with suitable options.”

The latest PW engine trouble had occurred this Wednesday itself when IndiGo was operating an Ahmedabad-Kolkata flight on a NEO (VT-ITK). The pilots got a warning that engine number two had failed and the plane had to be diverted to the nearest airport, Nagpur, where it landed safely and was then grounded.

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