Retrospective amendments are becoming a regular phenomenon in recent budgets. Such proposals for amendments are being resorted to primarily to neutralise the interpretation given by the courts or tide over adverse decisions against the Revenue Department.

Menace of retrospective amendments

Business Standard

Indo-Mauritius tax treaty has for long been a subject of controversy in India. The controversy started after the CBDT issued a circular that a certificate of residence issued by Mauritius will be sufficient evidence for accepting the status of residence as well as ownership for applying the provisions of the treaty.

Tail twisting of Mauritius tax treaty is unnecessary

In a recent decision of significant import, in Commissioner of Central Excise vs. SKF India Ltd. (2009 (239) ELT-385), the Supreme Court has answered the question of whether interest is payable on differential excise duties paid consequent to agreement on retrospective price revisions relating to past supplies of excisable goods. This is an important decision which has implications for all situations where price revisions are negotiated and agreed between manufacturers and their customers, typically OEMs, with regard to past supplies of goods.

Interest liability on retrospective price revisions

Most people assume that the Bills passed by Parliament become the law of the land. In recent times, however, the government has taken to notifying only selected parts of Bills passed, and then signed into law by the President. Take the Competition Act. Though passed in 2002, it was only in March this year that the government appointed the Competition Commission&rsquo;s members and chairman. And even now, the government has not notified Sections 5 and 6 of the Act, which deal with the regulation of mergers and acquisitions. Ironically, Section 1(3) of the Act allows for this possibility and says different provisions of the Act will come into force from the day they are notified. It is true that businesses have come out against the Act providing a maximum of 210 days for the Commission to give its verdict on M&amp;As.

Legislation - piecemeal

Subir Gokarn: Differentiated recovery

It should be interesting to see whether the issues arising out of the face-off between the two Ambani brothers will keep oil companies away from bidding aggressively in the latest round of the New Exploration and Licensing Policy (NELP) that was flagged off on Saturday. While Petroleum Secretary RS Pandey has said there will be no change in the existing policies of NELP, this is precisely the problem area.

Sunil Jain: Gassing NELP

In the context of huge volatility in the price of crude oil, last week, I quoted Prime Minister Gordon Brown and President Nicolas Sarkozy calling on regulators &ldquo;to consider improving transparency and supervision of futures markets to reduce damaging speculation&hellip;.This would serve the interests of orderly and adequate investment in future supplies. Volatility and opacity are the enemies of growth&rdquo;.

A V Rajwade: The dominant minority-III

Most of the technical factors suggest that the market has not yet bottomed.

Trading likely between 4,200-4,700

The government&rsquo;s decision to downplay the monsoon&rsquo;s failure has only worsened its credibility and will lead to a worse panic, says Shreekant Sambrani.

Shreekant Sambrani: Talking down the drought

Without a focus on time, our attempt to understand risk will fail.

The time arbitrage

India&rsquo;s comprehensive economic partnership agreement with South Korea, coming after the free trade agreement that it signed with Singapore in 2005, can turn out to be significantly more beneficial than the immediate gains that accrue from freer trade. It could lead to more Korean investment in India, and the use of India as a low-cost manufacturing base for export to third-country markets. It signals the coming together of Asian economies, and the greater integration of the Asian market, so far dominated by China&rsquo;s growing influence in the region. For Korea, the agreement gives it an important advantage in that its companies can now compete more effectively in India against rivals from Japan and even China&mdash;as India has lowered tariffs for Korea on 85 per cent of its imports (Korea in turn has dropped tariffs for 90 per cent of its imports).

A strategic partnership

It is now widely accepted that the faith placed in independent directors, to improve the standards of corporate governance, has often been misplaced. Most of them, and not just in the case of Satyam Computers, tend to go along with the promoters who appoint them. Another experiment with &lsquo;independents&rsquo;, in this case as experts, appears to be going the same way. Consider the case of the director-general of hydrocarbons, VK Sibal, who recently cited reports by some independent experts to validate his claim that the capital costs of Reliance Industries&rsquo; operations in the Krishna-Godavari Basin were not exaggerated, as alleged by ADAG chief Anil Ambani. One of these was from the Mustang Group, which ADAG officials later pointed out had done a lot of consulting work for Reliance, and so could not be regarded as independent.

Judging oneself

What the world needs is a Fed chairman instinctively sceptical of financial markets and their social value.

Dani Rodrik: Let finance sceptics take over

A series of ICAR studies on the impact of climate change can help farmers modify their cultivation patterns.

Surinder Sud: Changing with the climate

All companies have a &ldquo;way&rdquo; of doing things. There is the GE way, the Toyota way, the Disney way, the Nordstrom way, and so many others. Back home, we have the Satyam way and the MaytasWay, a copy of which I am holding in my hand. The key word in this 100-page book is &ldquo;North Star&rdquo; which was the only reference for Vasco Da Gama during his voyage to India.

Vandana Gombar: Finding the India way

The question the headline raises is being increasingly asked. Not because the trend is new, but because it is now more than eight years old. Across a range of segments from broadcasting (radio or TV), publishing or others, media companies that have got into the events business have seen somewhat disappointing results. The 4-10 per cent of topline brought in by the events doesn&rsquo;t justify the effort put in by media companies. Think of it this way &mdash; selling a double-spread ad in a magazine or a half-page one in a newspaper gets better margins than the sponsorship for an event.

Vanita Kohli-Khandekar: Should media companies get into events?

Bulky tender documents scare away honest bidders, help the greedy ones and breed corruption.

M J Antony: Signing on dotted lines

One danger in keeping the incentive structures common across all categories is that distributors will stop focusing on products that are more difficult to sell.

&#39;Should financial products have uniform commissions?&#39;

Double-digit inflation may be a thing of the past, with the wholesale price index now in negative terrain, but that brings little relief to most people when food price inflation remains untamed. The prices of quite a few essential food items, notably pulses, sugar, vegetables and fruits, have been rising quite sharply, even doubling in one year in some cases. A study released recently by the Associated Chamber of Commerce and Industry (Assocham) reported that households have curtailed their intake of dals, a key source of protein, due to the unaffordable prices. The per capita consumption of pulses has plummeted to a mere 11 kg this year, less than half of what it was in the 1960s (27 kg). Indeed, Assocham projects it to drop further to 9 kg in the later part of the year as pulse prices are unlikely to soften. The scenario for vegetables and fruits is no different, with some of them selling at prices that are multiples of the levels last year.

Dealing with food inflation

With the government stiffening the minimum qualifications for contractors to bid for various infrastructure projects, there is a fear that the new conditions may end up favouring the big boys. By excluding the smaller firms, the government may also be driving up costs since the competition will be more restricted than before. The immediate provocation for the new criteria is the Request for Qualifications (RFQ) for various National Highway Authority of India (NHAI) projects. To qualify for a Rs 500 crore project, for instance, a firm should have executed projects worth at least Rs 1,000 crore in the last five years (as against Rs 500 crore stipulated till now). Given the country&rsquo;s need to invest vast sums in the physical infrastructure each year, it obviously needs a large number of players to do the job, and they can gain experience and acquire expertise only if they are encouraged to make their entry.

Building entrepreneurs

This is a story at two levels, as all good stories are &mdash; at a personal and an anecdotal on one hand and an official and &lsquo;history in the making&rsquo; on the other.

Subir Roy: A nation in the making

Business Standard brings you expert opinions on various issues

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