Business Express

Rajasva Gyan Sangam: PM Modi asks tax officers to remove fear of harassment among taxpayers

Prime Minister Narendra Modi on Thursday held an interactive session with the top brass of the two revenue collection arms of the government -- CBDT and CBEC -- during a first-of-its-kind 'Rajasva Gyan Sangam'.

Inaugurating the two-day Rajasva Gyan Sangam at Vigyan Bhavan today, PM Modi asked tax officers to move towards digitisation and make tax administration better and efficient.

He also asked the tax officers to remove fear of harassment from the mind of assesses.

The Rajasva Gyan Sangam was attended by the top brass of the Income Tax department and Customs and Central Excise.

The conclave will deliberate on a on a host of issues related to taxpayer services and effective implementation of fiscal laws and government policies.

Modi has given his inaugural address to about 250 officials of the Central Board of Direct Taxes (CBDT) and Central Board of Excise and Customs (CBEC). Finance Minister Arun Jaitley also addressed the conference. Minister of State for Finance Jayant Sinha will deliver the valedictory address on the second and last day.

The sessions will be divided into two broad subjects relating to governments plan of financial inclusion and ensuring a transparent tax regime for businesses and foreign investors, besides issues and challenges being faced by the departments like Income Tax, Customs, Central Excise and the Directorate of Revenue Intelligence.

Modi, at his recent review meetings with the CBDT and CBEC officials had reiterated the need for reducing taxpayers grievances and ensuring a quick resolution of their problems.

SBI begins working on framework for subsidiaries merger

"A team of 15-20 members has been set up and it has started working on the framework for the merger. The team is headed by a general manager and there are a few deputy general managers," a source said.

The team has been formed under the supervision of associate and subsidiaries department, which is being headed by managing director V G Kannan.

"If everything works fine, in 3-4 months the process is likely to begin," he said.

Last month, the bank's board had submitted a proposal to the government for merging its five subsidiaries and first women-oriented lender Bhartiya Mahila Bank with itself.

"This merger discussion is purely exploratory at this stage and is not certain. A proposal seeking an in-principle approval to start negotiations with associate banks will be submitted to the government," SBI had said in a statement issued after its board meeting last month.

SBI has five associate banks -- State Bank of Bikaner and Jaipur, State Bank of Travancore, State Bank of Patiala, State Bank of Mysore and State Bank of Hyderabad.

"The idea is to merge all the five associate banks at the same time. They are on the same technology platform, which SBI has... It will not be a difficult process," the source added.

It is unclear whether the team which is looking into merger processes of the five subsidiary banks with SBI is also laying the groundwork for Bharatiya Mahila Bank's inclusion at this juncture.

Recently, Finance Minister Arun Jaitley had said the Centre is evaluating the merger proposal and will soon respond.

"We are looking at SBI (proposal) at the moment. It is with the government and (it) will respond. The government's policy, by and large, supports consolidation. I have indicated that in the budget itself," he said after a meeting with the heads of public sector banks and financial institutions held last week.

When asked how soon the government nod will be given to the proposal, Jaitley had said: "We are expecting (approval) shortly."

Immediately after the announcement, the associate banks' employee union had termed the board's decision as arrogant and had gone on a nation-wide strike on May 20. The employee unions of these five associate banks have called for a strike on June 28 and July 29 to protest the proposed merger.

Moreover, CPI General Secretary S Sudhakar Reddy today said Telangana assembly should pass a resolution opposing the amalgamation and added the state will lose revenue if State Bank of Hyderabad is merged with parent SBI.

On June 9, the newly inducted CPI(M)-led LDF government in Kerala had opposed the merger of State Bank of Travancore with SBI, becoming the first state government to lodge a protest.

"People of the state consider SBT as a bank of Kerala and the government also has the same view. We want SBT to remain as it is," Chief Minister Pinarayi Vijayan had told reporters. Among the five subsidiary banks, State Bank of Bikaner and Jaipur, State Bank of Mysore and State Bank of Travancore are listed entities.

The merged entity will create a banking behemoth, which can compete with the largest in the world with an asset base of Rs 37 trillion (Rs 37 lakh crore) or over USD 555 billion, with 22,500 branches and 58,000 ATMs as on December 2015. SBI alone has close to 16,500 branches, including 198 foreign offices spread across 36 countries.

SBI first merged State Bank of Saurashtra with itself in 2008. Two years later, State Bank of Indore was merged. SBI has maintained since then that it would merge the others as well but none of its initiatives fructified due to lack of capital (which was pegged at least Rs 2,000 crore each per bank) and stiff opposition from the employee unions.

Government has been considering merger of some of the state-run banks to create a stronger entity.

"The country needs stronger banks rather than a large number of lenders," the Finance Minister had said at the second edition of the Gyan Sangam held in March.

Last month, Minister of State for Finance, Jayant Sinha, had said the county will have 8-10 very competitive public sector banks once the "dust settles" and the consolidation phase ends.

"We have 27 public sector banks right now. When the dust settles, I think we will have, may be, 8-10 very competitive banks. Some of them are going to be large scale global players, while some are going to be differentiated banks," he had said.

Dr Reddy's To Buy Eight Products In US For $350 Million

Dr Reddy's Laboratories has inked a pact with Teva Pharmaceutical and an affiliate of Allergan Plc to buy a portfolio of eight abbreviated new drug applications (ANDAs) in the US for $350 million (around Rs 2,300 crore) in cash.

The portfolio consists of products that are being divested by Teva as a precondition to its closing of the acquisition of Allergan's generics business, the Hyderabad-based firm said.

The portfolio being acquired is a mix of filed ANDAs pending approval and an approved ANDA and comprised of complex generic products across diverse dosage forms, Dr Reddy's Laboratories said in a statement.

The combined sales of the branded versions of the products in the US is around $3.5 billion, it added.

"This transaction will add strength to our product portfolio, help us be more relevant in the US market and also create new opportunities for growth," G V Prasad, Co-Chairman and CEO of Dr  Reddy's Laboratories said.

The acquisition of these ANDAs is also contingent on the closing of the Teva/Allergan generics transaction and approval by the US Federal Trade Commission of Dr Reddy's as a buyer.

"The acquisition of these attractive ANDAs from Teva will enhance our short-to-midterm aspirations and is consistent with our growth initiatives to identify inorganic opportunities to expand our base business," Dr Reddy's, Executive Vice president and Head of North America Alok Sonig said.

The company has a strong track record in the US market with over 79 filed ANDAs pending approval, of which we believe 18 have first-to-file status, he added.

Dr Reddy's is acquiring the portfolio on a cash-free, debt-free basis and expects to finance the transaction using a combination of cash on hand and available borrowings under existing credit facilities, the company said.

Rupee slips 16 paise against dollar in early trade

The rupee was trading lower by 16 paise at 66.87 against the U.S. dollar in early trade on Friday on higher demand for the American currency from importers and banks.

Dealers attributed the rupee’s fall to increased demand for the U.S. currency, but dollar’s weakness against some currencies overseas made sure the losses do not mount.

The domestic unit closed lower by 6 paise at 66.71 in Thursday’s trade due to fag-end dollar demand from banks and exporters on the back of higher crude oil prices amid a fall in domestic equities.

Meanwhile, the benchmark BSE Sensex fell 80.38 points, or 0.30 per cent, to 26,683.08 in early deals.

Shopping on e-shopping sites to get 5 per cent costlier in Uttar Pradesh

The Uttar Pradesh government on Tuesday imposed an entry tax on items purchased from e-retailers.

 The move is seen to pacify retailers in the state. It was given a nod by CM Akhilesh Yadav during a state cabinet meeting yesterday.

The 5% entry tax is seen as a big going in favour of lakhs of retailers who were losing out their businesses to e-commerce portals.