InterGlobe Aviation, parent of the country’s largest airline IndiGo, on Monday announced redesignating Ronojoy Dutta as the company’s whole-time director and CEO.
Dutta, who is currently the CEO, has been redesignated with immediate effect and his term in the new role would be valid till January 23, 2024, according to a release.
“The decision was taken unanimously by the board of directors of the company at its meeting held today (Monday),” it added.
Dutta has been associated with the company as CEO since January 24, 2019.
“During his year-long stint with the company, IndiGo has witnessed aggressive operational and business expansion.
“Dutta’s extensive experience in the aviation industry channelled IndiGo’s efforts into a mission to boost economic growth and social cohesion in India, by providing air connectivity and affordable air fares across our country and to international destinations, thereby promoting trade, tourism and mobility,” the release said.
He had also served as an advisor to the restructuring of Air Canada, US Airways and Hawaiian Air. Besides, he had been the president of Air Sahara and the United Airlines.
With a fleet of more than 250 planes, IndiGo operates over 1,500 flights daily.
The country’s automobile industry will gather pace by July-August this year, a top official at Tata Motors said, attributing the current temporary slowdown to issues like consumers facing problems in securing vehicle loan and the companies shifting to BS-VI emission norms as mandated by the government.
“The sluggishness of the vehicle market in the country is going to be short-lived. We hope that sales of passenger vehicles will record pace by July-August before the festive season,” Tata Motors president (passenger vehicles business unit), Mayank Pareek, told reporters after launching the company’s new car Altroz in Madhya Pradesh.
He hoped that the vehicle market would grow due to the continuous expansion of infrastructure in the country and the increasing population of young professionals.
Pareek said that about 74 per cent of customers in the country buy cars by taking loans from banks.
But for the last 12 to 18 months, customers are facing difficulties in getting vehicle loans from banks.
Besides, he said that due to the emission standard change from BS-IV to BS-VI, there has been a slight slowdown in the entire motor vehicle industry as all the vehicle manufacturers are currently finishing their old stock of BS-IV class vehicles.
Sharing details of Tata Motors’ position in this regard, Pareek said, “We have exhausted stock of BS-IV class vehicles in our factories in the first nine months (April-December) of the ongoing financial year.
The company hopes that by February 1, the stock of vehicles in this category will be reduced to less than 5,000 units with Tata’s dealers.
“It is to be noted that as per the Supreme Court’s decision to reduce environmental pollution, Bharat Stage (BS)-VI emission standards are going to be implemented from April 1 and new vehicles will be sold in the country as per this standard only.
With this, the registration of BS-IV category vehicles will be stopped.
Sheroes, a women’s community platform, said it would now enable peer-to-peer social commerce and credit to women on its network. Viewed as the next “billion-dollar” opportunity for India, social commerce is projected to be an emerging sector, with platforms like Poshmark redefining global buyer, seller behaviour and consumption.
Founded in 2014 by entrepreneur Sairee Chahal, Sheroes network has become one of the largest employment generators for women in the country. Its users engage in multiple ways on the platform – buying and selling products and services, finding work and seeking advice. The other engagements include posting content, building their communities, and growing their personal and professional networks.
Almost 2,50,000 women are members of Sheroes Bazaar, a peer-to-peer social commerce community on the platform. Sheroes said the peer-to-peer social commerce is booming as more and more women from Tier 2 cities and beyond, get online. The presence of over 70 per cent of Sheroes users outside Tier 1 cities as well as access to the platform in multiple languages, expands the spectrum of women who can transact and conduct business online. Resellers, owners of small businesses, entrepreneurs and service providers are all leveraging Sheroes platform to boost their identities as businesswomen via social commerce opportunity called Sheco. The organisation said users are leveraging Sheco to gain access to training, support and the tools to become successful entrepreneurs.
To further support Sheco businesswomen, the firm aims to bring the offline model of microloans via cooperatives and microfinance companies, online. According to multiple reports, the percentage of women microfinance defaulters is around 1 per cent while this figure is much higher for men. Also, women leverage loans to create value by setting up small businesses, generating employment and funding education and upskilling.
In the next 3 years, Sheroes said it aims to be the largest digital lender of microloans to women. The organisation said its users with mobile phones and bank accounts or UPI accounts – who don’t have credit scores but have been actively building their Sheroes profiles – are potential borrowers. They comprise micro-entrepreneurs, home chefs, beauty parlour owners, handicraft makers, resellers and other service providers.
Sheroes said the financial independence and entrepreneurship are big themes for the organisation as it builds a social network to support 270 million women who have come online in the last two years in India. By the end of 2020, Sheroes aims to become a network of 100 million members. The network also offers a chat-based counselling helpline, mentorship, resources and other opportunities.
Daimler India Commercial Vehicles (DICV), which sells trucks and buses under the Bharat Benz brand, expects the current year to be a decisive one for the company. DICV is taking on rivals Tata Motors and Ashok Leyland with its BS-VI line of vehicles.
It is also seeking to aggressively expand its service touch points from the current 237 to 300 by year end and beyond 350 by end of 2021, according to Satyakam Arya, managing director (MD) and chief executive officer (CEO), DICV.
“After a strong growth in 2018, the market took a U-turn in 2019. We restructured the entire company in terms of costs and made it much more resilient. We also sharpened our focus on exports. As a result, the company is now much better positioned financially,” said Arya.
He added that the latest range of BS-VI models the company will introduce in the current year will give it an edge over rivals in India.
DICV doesn’t report monthly sales volumes. The company’s calendar year volumes are estimated to have dropped to 14,500 units in 2019 from 22,000 units in 2018.
The key differentiator in technology will be the after treatment systems used in vehicles. Bharat Benz trucks have up to six years standard warranty and an extended warranty of up to eight years.
The trucks will have service intervals up to 20 per cent longer. This will reduce maintenance cost by up to six per cent, the company claimed.
DICV’s resolve to give a tough fight to rivals comes at a time when truck sales in India have plunged to a record low amid a slowing economy.
Sales of medium and heavy trucks fell 43.5 per cent year-on-year to 146,780 units in the first nine months of the current year, according to the Society of Indian Automobile Manufacturers (SIAM).
Demand is expected to take a further hit as India’s auto industry leapfrogs to BS-VI emission norms from April 1. The new emission norms are expected to make the BS-VI trucks at least 10-15 per cent dearer compared to BS-IV models.
DICV invested close to ~500 crore and developed new facilities and over 1,000 new parts for BS-VI. It achieved localisation of over 80 per cent, the company said.
One of the late entrants into India’s truck market, which has largely been a race between Tata Motors and Ashok Leyland, Bharat Benz claims that unlike its competitors, the company doesn’t not believe in discounting or panic selling. The top two firms control 80 per cent of the market.
“I do not understand the panic selling which other manufacturers have resorted to in the last few months. I think it was triggered by the inventory (of BS-IV models) they have. We never participated in that game as we believe in steering the company profitably and not through market share,” said Arya, alluding to the deep discounts being offered by the companies to woo buyers ahead of the BS-VI switchover.
The value a truck owner will get by investing in Bharat Benz BS-VI models will be higher than that of a BS-VI variant of other trucks.
Unlike most other trucks, Bharat Benz models do not compromise on fuel efficiency because of transition to BS-VI, claimed Arya.
He expects 2020 to be a tough year as the impact of the axle norms, which allows a 16-49 tonne truck to carry 25 per cent more load, has not been absorbed yet.
“A back-of-the-envelope calculation shows that if India’s GDP grows at 7 per cent, we will take three years to absorb the additional capacity. With the economy having slowed, the pain due to the additional capacity will continue,” he said.
The Income-Tax Department’s searches on the Bharat Hotels group, that runs the chain of Lalit Hotels, has led to the detection of “undisclosed” foreign assets of more than Rs 1,000 crore and huge black money that the business house has “stashed” abroad, the CBDT said on Friday.
While the policy-making body of the department did not take any names in the statement issued after the raids, official sources confirmed it to be the Bharat Hotels Group that functions under its CMD Jyotsna Suri.
“The investigation has successfully lifted the veil, leading to detection of undisclosed foreign assets of more than Rs 1,000 crore, apart from domestic tax evasion of more than Rs 35 crore which may lead to consequences under the Black Money Act, 2015, as also, action under the I-T Act respectively,” the Central Board of Direct Taxes (CBDT) said.
“Foreign assets include investment in a hotel in UK, immovable properties in UK and UAE and deposits with foreign banks,” it said.
The CBDT said the group is a “leading member of the hospitality industry, running a hotel abroad and a chain of luxury hotels under a prominent brand name situated at various locations in India”.
“The search operation has so far resulted in seizure of unaccounted assets valued at Rs 24.93 crore that includes Rs. 71.5 lakh in cash, jewellery worth Rs 23 crore and expensive watches valued at Rs 1.2 crore,” the statement said.
The department had launched raids at 13 premises of the group, Suri and others on January 19 in and around Delhi.
The Bharat Hotels group owns the chain of Lalit hotels in the country. It runs over a dozen such luxury facilities at present.
Jyotsna Suri has been associated with the Bharat Hotels group since 1989 and took over as the Chairperson and Managing Director (CMD) in 2006, after the death of her husband and hotelier Lalit Suri.
Bengaluru: To fight the rising menace of online fraud by cyber crooks resulting in consumers losing money, Paytm Payments Bank — which houses the Paytm e-wallet — has handed over 3,500 numbers to the Telecom Regulatory Authority of India (Trai), the ministry of home affairs (MHA) and CERT-In, the cybersecurity agency.
It has also filed a first-information report (FIR) with Noida police’s cyber wing against the 3,500 numbers which, the company believes, are behind online frauds. Paytm hopes the government and the telecom regulator could use the database to stop the fraud attempts on consumers.
In October, TOI reported how seven internet-based companies had come together to share data with the Reserve Bank of India, State Bank of India and other relevant stakeholders to fight rising online frauds.
Along with the list of offenders, a list of SMS shortcodes was given to the authorities. SMS shortcodes are essential tools to use the company’s name falsely to fool consumers. For example, one of the most used shortcode is Pytm, mimicking Paytm. This can deceive a consumer to believe the text is coming officially from Paytm.
“Telecom operators should be directed to have stringent control on the issuance of shortcodes for bulk messages to companies. There is also a need to blacklist companies permitting such SMSs to be sent,” said Paytm Payments Bank MD & CEO Satish Gupta.
In its communication to Trai, Paytm has stressed on the need to give financial institutions the authority to raise requests with telecom companies for the immediate blocking of phone numbers and shortcodes sending fraudulent SMS.
Goods and services tax (GST), slated to be a good and simple tax, is now a toddler of 30 months. There is a consensus that it has been good in terms of reduction in effective rate of tax and supply chain efficiencies for businesses. However, industry is complaining that it has not been ‘simple’ and has increased the compliance burden.
It is, therefore, important that we look at some structural changes to bring in a bit more stability and certainty in GST.
REDUCE NO. OF SLABS To start with, we must put the debate on frequent TAX rate changes to rest by bringing in a white paper outlining the rate structure we want over next few years. Increase in tax rates does not guarantee increased GST collections, that too during the phase of economic slowdown. However, there is a need to simplify the structure by reducing the rate slabs to three. Either we need to collapse 12% & 18% or 5% & 12% slabs into a single rate.
EASE INPUT TAX CREDITS Broad-basing the input tax credit (ITC) system is also urgently needed. Logically, GST incurred on all business expenses should be allowed as a setoff, in line with global best practices. If liberalising the credit is not possible then a flat denial of say 5% of total input taxes, at the option of tax payer, can be explored without the need of detailed scrutiny of nature of expense incurred. Blocking input credit for sectors such as restaurants and real estate distorts the GST chain and must be reviewed.
EXPAND THE TAX NET Large part of economy is still outside the GST net and GST Council should have a comprehensive discussion on how real estate, petroleum and electricity can be brought in its fold. This can be done in a staggered manner by first bringing in industrial fuels like Aviation Turbine Fuel (ATF) and natural gas.
REWORK ITC Businesses are starved of cash as of now and GST is one of the reasons. The input tax credits are claimed at a state level and many businesses have credit accumulation in one state but are required to pay tax in cash in some other state(s). At least for central GST, a national pool can be considered, in addition to exploring innovative ideas of allowing an offset against income tax. Any excess input taxes should ideally be allowed as a refund, subject to safeguards that may be needed.
SET REALISTIC TARGETS From government’s standpoint, monthly average GST collection has only been a tad above Rs 1 lakh crore in the current fiscal year and the budgeted target is likely to be missed by a significant margin. While revenue collection is important, it should not determine the success of GST, which is manifested in ease of doing business and increase in tax base.
With the new compliance regulations, including e-invoicing, proposed from April 2020, the revenue collection is likely to improve with real-time tracking of input credits claimed by businesses.
One would hope that the government would set a more realistic GST collection target in the upcoming Budget.
The writer is Partner & Leader Indirect Tax, Pwc India
It is fair to say that India’s VC industry is broadly happy with Government policy in recent times; and yet there always seem to be unmet aspirations that everyone hopes would be addressed in the next Budget. This is the common theme in every conversation I have at industry events, panels and the like – so at the risk of being repetitive, I will enumerate these.
From a “pure” taxation standpoint, the ecosystem wishes for lowering of the GST rates for Fund managers for management fees charged to AIFs. This could be especially useful for smaller funds (say less Rs 100 crore). Second, they wish for rationalization of the timing of taxes on ESOPs – by which taxes are calculated only when true capital gain (as opposed to paper gains) are realized. Both changes would improve sentiment and the viability of careers in these fields.
Second, the government should make it easier for India’s massive pension funds and insurance players to invest into VC funds. This could be done through a mixture of beneficial taxation, well-defined and forward-thinking policy and broad education amongst decision makers in such institutions on the benefits of investing into PE/VC funds. In India, the AIF asset class, remains largely misunderstood by large financial institutions that continue to balk at the risk to reward ratio in VC funds; and still refuse to take a “portfolio approach” to deploying their large capital reserves, and in turn not allocating anything at all to high risk/high reward assets.
Out of the Box Aside from the oft-requested incentives, I’ve often thought of some out-of-the-box mechanism that the government could initiate to further catalyze growth in the ecosystem and encourage entrepreneurship. There are many entrepreneurially minded people that don’t venture out of more defined career paths because of the fear of failure. What if there could be a tax incentive for larger corporations to hire entrepreneurs of failed startups; or alternatively give some monetary incentives to these entrepreneurs for their next career path – for example seed funding from a Government Fund of Funds program. Sure, this cannot be rolled out to all startups, for obvious reasons, but could be offered to startups that create over 100 new jobs but don’t go on to achieve lucrative exits.
Such creative measures would further encourage people to start new businesses and create numerous new opportunities. A few of these startups would raise money and realize exits – thereby positively impacting the entire ecosystem. The key point here is that a lot of these activities would not have been possible had these entrepreneurs not chosen to break free from ‘safer’ career paths.
Issue of e-invoices by the taxpayers registered under GST having a turnover above Rs 500 crores has been notified on 13th Dec 2019. It is optional to issue from 1st Jan 2020 and mandatory from 1st April 2020. These notifications have been issued followed by the decision taken in the GST Council in its 37th GST Council Meeting.
Electronic invoice, or e-invoice is the future means of electronic billing. It has been adopted by many governments internationally. It has been implemented in a staggering manner over a period of time, initially launched for B2B (Business to Business) and B2G (Business to Government).
In India it is being rolled out in B2B transactions only as a part of measures to curb tax evasion. The government officials in many European nations are urging their businesses to adopt the system, and the United States treasury has even gone so far as to predict that adopting e- invoicing will save the government a staggering 450 million dollars annually. This is a major step in the push for a digital economy. Let’s examine the advantages of e-invoicing in the Indian context.
Benefits of e-invoicing E-invoicing is the new system through which business to business (B2B) transactions are authenticated electronically by GSTN for further use on the common GSTN portal. The biggest benefits that e-invoicing delivers are transparency and proof.
Today, a transaction between the supplier and recipient is done directly without the government having any proof of the exchange. With e-invoicing, the moment an invoice is made, it will be uploaded to GSTN portal where pre-validation will be done and a unique number called IRN (Invoice Reference Number) will be issued. Once IRN is issued, the tax invoice will be shared with the recipient also.
For a nation like India where tax evasion is rife, this system can be a boon. This real time tracking of invoices can be done by both, vendors and the government, and will result in a reduction of frauds and fake GST invoices—a major concern today.
Secondly, e-Invoice further boosts the automation when it comes to GST return filing process. GSTR filing currently involves immense manual work that is prone to errors. e-invoicing can bring ease, speed and accuracy to this process. Once IRN is issued, it will update the Annx – 1 of the Supplier & if e-waybill is required to be issued, Part – A of the same will be updated. It will also update the Anx-2 of the recipient.
Updating GST Returns also saves lot of time, human errors for data entry and also avoids major reconciliation issues.
Challenges to address Although the move to a new system is exciting, there are some challenges. For starters, in a country like India, although internet coverage has improved significantly during the last decade, many parts of India continue to suffer from lack of infrastructure. For instance, for an MSME with a factory at a remote location grappling with poor network connectivity, e-invoicing may appear to be a compliance hassle
Large organizations, who have implemented auto generation of the e-waybill on creation of the tax invoice has to change their existing process. Now they have to interface their system with the IRP portal rather than the e-waybill portal so that IRN issued. Also changes have to be done to their software to capture the IRN number in the databases.
Taxpayers who have not up taken automation of e-waybill have to reach out their OEM’s for the configuration of the same.
Training has to be provided to all the concerned stakeholders for the new changes, proper budgets should be allocated for the IT and also if any impact of working capital is foreseen, proper arrangements should be made for the same.
Similarly, the manual bill books and accounting software products used today may need to undergo an overhaul. This may prove to be a time-consuming task. MSME segment also suffers from acute manpower shortage. Getting the right professionals with in-depth knowledge of e-invoicing will not be easy for MSMEs. Investing in manpower training may be costly too. Given such circumstances, using tried and trusted software products like ERP, distribution management systems from reputed vendors will help tackle these issues.
The road ahead E-invoicing provides a push towards a digital economy. Curbing tax evasion and increasing tax collections for the government may ensure that the government will not increase GST rates any further. E-invoices can be created for every document there is—from debit or credit notes to vehicle invoices. The resultant positive impact on efficiency will lead to minimization if not eradication of data entry errors and greater transparency.
The writer is Chief Taxologist & Head of Cloud Business, Logo Infosoft.