President writes by pengxuebo


									Dear Member,
As you are aware the annual meeting of
the World Economic Forum (WEF) in
Davos, Switzerland was held from 23-27
January,2008. The meeting entitled ‘The
Power of Collaborative Innovation’, brought
together 2,500 of the world’s political and business
elite, including 27 heads of state or government, and more
than 110 government ministers, the media, academia, the arts
and civil society. The global economic uncertainties and development issues
dominated the proceedings with the majority of political and business leaders expressing
divided concerns over the prospects for a slow down in the US economy. Pascal Lamy,
Chief of the World Trade organization, said a US recession risk is obvious. He cautioned that
protectionist risks are higher if there was to be a recession. Japanese Prime Minister, Yasuo
Fukuda, while acknowledging the risk of the global economy taking a downward turn against
the backdrop of mortgage loan in the United States and the surge of oil prices to record levels,
said “There is no need to take an excessively pessimistic view of the current situation, but at
the same time we do need to have a sense of urgency as we engage in coordinated actions while
each country also implements necessary domestic response measures”. However, the US
government has a different view on the issue. U.S. Secretary of State, Condolezza Rice said
that her country’s economy would remain a leading engine for global economic growth despite
concerns about a possible recession. “The U.S. economy is resilient, its structure in sound, and
its long-term economic fundamentals are healthy’ assertedRice.
Among other things development and related, issues including the U.N. Millennium
Development Goals (MDGs), water crisis and climate change, were discussed. The MDGS,
adopted at the UN General Assembly in September 2000, set specific human development
targets by 2015 to tackle the issue of poverty, education, gender equality, health and
environment. U.N. Secretary General Ban ki-moon issued a call to make 2008 the year to act
on the MDGS with new ideas and approaches.
Highlighting the urgency to tackle the global water shortage, UN Chief Ban said that the
challenge of securing safe and plentiful water for all is one of the most daunting challenges
faced by the world today. The issue of climate change got a strong boost from Yasuo Fakuda
who put forward a “Cool Earth Promotion program’ a follow-up initiative of last year’s ‘Cool
Earth 50’ proposal which calls for a halving of global green house gas emissions by 2050.
Emphasising the urgent need to implement the ‘Cool Earth Promotion Program’ in three parts:
the post-Kyoto framework, international environmental cooperation and innovation, Fakuda
announced Japan would establish a mechanism utilizing 10 billion US dollars to cooperate
                                                                                                                   President writes

actively with developing countries efforts to reduce emissions.
Thanks for your cooperation.

                                                                           Atluri Subba Rao

                                                                       19th February 2008   ||   FAPCCI Review   || 3
         An ISO 9001 : 2000 Organisation
                                           Vol. VIII - No. 8                           19th February 2008                                                      Rs.15
             Senior Vice-President                                                                 Contents
                 Vice-President              3 President Writes
                                             5 About Er. R.S.N. Murthy
            Managing Committee
                                             6 Jalayagnam Need for Economy in Planning, Design,
                 AMIT SANGHI
             SHRIGOPAL INANI
                                                    Tendering and Good Quality in Execution
                 M. JAYADEV                  9 Innovation
           J.S. KRISHNA MURTHY              10 Future’s bright for the Asia Pacific region
            DEVENDRA SURANA                 12 Tax News
                                            13 Electoral Roll 2008-09
              NITIN K. PAREKH               17 Judgement on Entry Tax Act
              GOWRA SRINIVAS
          VISHWAMBERLAL KEDIA               19 Compassionate Appointments
              C. SUDHIR BABU
                                            22 G.O. on Profession Tax
             SOHANLAL KADEL                 23 Circular Instructions of CCT
       RAJENDRAKUMAR BADRUKA                26 FAPCCI at Work
                S. SUBBA RAO
                                            29 For your diary
             RAMAKANTH INANI                34 News Clippings
              V.V. SANYASI RAO
                                                                                        Editor : M. HEMALATA
                                                                                     Editorial Advisory Board
                                                V.K. SRINIVASAN,                 I.A.S. (Retd.)                     M. GOPALAKRISHNA,                   I.A.S. (Retd.)
           HARI GOVIND PRASAD                   Vice-Chairman, Indian Institute of Economics                       Director, Andhra Pradesh Gas Power Corporation Ltd.
          KODANDA RAM CHALLA               OMPRAKASH TIBREWALA                                     SHEKHAR AGARWAL                            NITIN K. PAREKH
                   V.S.RAJU                      Past President, FAPCCI                            Member – Managing Committee               Member – Managing Committee

                V. ANIL REDDY                     C.V. NARASIMHA REDDY                                                           S. SUBBA RAO
                                                Chief Advisor, Public Relations Society of India                                    Executive Editor
               GOPAL M. MOR                         The views expressed by the authors in their articles published in this magazine are
                                                         their personal views and do not necessarily reflect the views of FAPCCI.
             J.S. KARUNENDRA               The Federation of Andhra Pradesh Chambers of Commerce & Industry
            A. SATYANARAYANA                 Federation House, Red Hills, Post Box No. 14, Hyderabad - 500 004.
            Y.S.R. VENKATA RAO                    Phones : 23393428, 23393658         Fax : 040-23395083
                                                     E-mail :     Website :

4 || FAPCCI Review || 19th February 2008
                                     Er R S N Murthy, FIE
                           Chief Engineer(Retd.) Irrigation and CAD Dept., AP

Er R.S.N. Murthy obtained B.E. Degree in Civil       awaiting its Third Edition. He saved several
Engineering in 1948, joined the Irrigation           crores of rupees to the government by suggesting
Department and after working for more than 3         alternative alignments in Nagarjuna Sagar
½ of decades, retired as Chief Engineer. He was      canals avoiding 1 st set of tunnels and high-
closely associated with the Planning, Design and     pressure aqueduct to cross Gundlakamma River
Execution of Major Irrigation Projects such as:      on Nagarjuna Sagar right canals. He was the
Polavaram Project; Rallapad Project; Krishna         first to complete the distributary system for the
Barrage; Godavari Head Works Reconstruction          whole Nagarjuna Sagar Project and receive water
after 1953 floods; Nagarjuna Sagar Right Canal;      for irrigation. He was given assignment in
Nagarjuna Sagar Left Canal; Nagarjuna Sgar           C.W.P.C. and United Nations for which he could
Dam Hydro Electric Scheme; Nagarjuna Sagar           not go due to his inability to leave Hyderabad.
Right and Left Canals; Hydro Electric Scheme;
Nagarjuna Sagar Nuclear Power Project;               He was incharge of quality control of Sri Ram
Inchampally Project; Sri Rama Sagar Dam; Sri         Sagar Dam and Major Works on canals of the
Rama Sagar Canals along with Dr K.L.Rao.             project along with the Laboratories. He is a
                                                     Fellow of Institution of Engineers (India) and
World Bank appreciated his work on Sriram            evinces keen interest in professional activities.
Sagar Dam for completing the crest gates one
year of schedule, which helped the reservoir to      Murthy Institute of Technology and Science at
get filled next year. He has contributed several     Keesara about 12 km. from ECIL was promoted
papers, which were published by C.B.I., the          by him and established in 2005 and is quite
                                                     popular and considered one among the best in

Institution of Engineers (India) and other major
Engineering Institutions. He is the author of a      the state as only the top 30,000 ranks holders
book on “Irrigation” which is popular and is         out of 1,60,000 qualified for admission last year
                                                     got admitted to the college by Govt. counseling.

                                                                          19th February 2008   ||   FAPCCI Review   || 5
                                                                                                                         Er R S N Murthy, FIE
                                                                                                 Chief Engineer(Retd.) Irrigation and CAD Dept., AP

                 Let me congratulate the govt on the decision taken to            and beneficial use. Regional or state wide distribution of
                 complete irrigation projects worth about 47,000 crores.          water can be made but what is immediately required to
                 These projects after completion will not only enhance the        be done is to construct as may projects as possible on
                 irrigation and Hydro electric potential of the state but also    Krishna and Godavary in A.P. in particular and store max
                 will improve the prosperity of rural area many fold. A project   quantity of water. This will help us to utilize the carry over
                 like Nagarjuna Sagar-on which not more than two                  water available and give more regular supplies. A.P.being
                 thousand crores was spent must have brought around two           a tail end state this is absolutely necessary as upstream
                 lakhs crores worth of production and electricity. On the         states in spite of all laws and directions some how will
                 above basis the benefits after completion of above projects      find an opportunity to hold up water and cause loss to
                 will be enormous.                                                riparian states uncalled for controversies and regional
                                                                                  bickering will only delay completion of projects in A.P. and
                 With my experience and back ground having worked all
                                                                                  will cause us permanent damage and deprive our rights
                 my career in river Valley projects with Dr.K.L.Rao and
                                                                                  for our share of water. Several officers and politicians at
                 others in projects like Polavaram, Nagarjuna Sagar, Sriram
                                                                                  govt level and some public are under the impression that
                 Sagar etc and feeling sad about water going waste into
                                                                                  projects completed 59 far such as Nagarjuna sagar, Sriram
                 sea. I filed a P.I.L. .No. 14363/2002 in high court requesting
                                                                                  Sagar etc took lot of time for completion. This is not correct
                 central and state govts to take up projects preventing water
                                                                                  Nagarjuna Sagar project was completed in 7 years and
                 going waste into sea. As an example I quoted in river
                                                                                  water was released for irrigation around Narsaraopet and
                 Godavary alone evaluating at the rate of 10 paise per liter
                                                                                  the ryots were not ready to receive water. Sri Ram Sagar
                 of water 5,00,000 crores worth of water of 3000 T.M.C is
                                                                                  project was completed one year ahead of schedule and
                 going waste into sea every year. The Govt promised to do
                                                                                  world Bank appreciated it. For want of funds and
                 the needful in the High Court.
                                                                                  diversion of funds for welfare schemes completion of
                 India with 16% of the world’s population has only 2.1 %          distribution systems were delayed. With the impression
                 earth surface but fortunately 5% of world’s water                that works are getting delayed E procurement tender
                 resources. But so far we have not utilized even upto 50%         system is introduced. This is defective as it deprives the
                 and allowing more than 50% or about 300 cubic kilometers         owner of the advantage due to change in design
                 going waste into sea. with more and more Industrialization       specification quantities etc while it exposes the contractors
                 and improved living conditions of population demand for          to the vagaries of department in giving approvals,
                 water is increasing and every state and region is pressing       changing the work at site environmental hazards etc.
                 for its share of water. with changing weather conditions         Even though the present irrigation projects are being
Jalayagnam ...

                 the inflows in are likely to come down.                          manned by highly qualified engineers they lack practical
                 Hence every effort should be made to store and save every        back ground as no Major projects were taken up during~
                 drop of water and utilize the water most economically            the last 20 years with the result effort to save money by
                 and if possible adopt methods for reuse of water. The            alternative designs or proposal lack. I had the unique
                 country and state should treat itself as a family and            advantage in working with Dr.K.L.Rao and make him agree
                 distribute the water available as family property subject        to alternative detour alignment to Gundla Kamma
                 to legal riparian rights and put it to the most economical       alternative detour alt to 1st set of twin tunnels etc. These
                                                                                  were mentioned in my book also.

      6 || FAPCCI Review || 19th February 2008
If appropriate decisions are taken I feel we can save           Changes in site conditions
several hundreds of crores of expenditure. This not only
helps in saving money the works can be completed much           If there are abnormal changes in site conditions such as
earlier with better quality.                                    deeper foundations than those originally contemplated or
                                                                additional scope of the project the additional expenditure
I offer my views on some of the items of work in projects.      has to be compensated by the govt even if the govt refuses
Taken up under Jalayagnam.                                      to agree to pay the contractor can not be denied the same
                                                                in a court of law. The department should also see the land
Tunnels                                                         acquisitions are not delayed and the work is not hampered
I feel the tunnels for Velugonda project are not required       due to agitation or abnormal conditions this will result in
and an alternative detour alignment can be adopted. This        several crores of savings by preventing contractors from
would be cheaper by more than 300 to 400 corers and             makings claims.
can be completed earlier. We have done it in Nagarjuna          Development of Ayacut
Sagar canals and my book gives the details about it. This
suggestion applies to such tunnels adopted in cannals           The department should see that the distribution system is
any where.                                                      completed by the time the head works are ready to deliver
                                                                water. In Nagarjuna Sagar, Narsa Rao pet block
Shiefting Surplus Courses                                       distributaries ( for which I was recommended for an
                                                                advance increment) were ready but the ryots were not
The original proposals ( D.P.R’s) for most of the projects      ready. Proper planning is required to make optimum
were prepared by field engineers who never had any              utilization water which will bring in early benefits to ryots
designs experience & and a serious approach for                 of several hundreds of crores of produce.
economy. Hence they adopted conventional methods
which are expensive. Hence there is nothing wrong in            Change in quantities and rates
shifting the surplus courses and there is no need to add
10% extra gates assuming some gates do not function.            Payment cannot be claimed by contractor for work not
C.W.P.C. manned by staff with very little field experience      done and he should be paid as per actuals only No court
tend to play over safe by taking into account a single day      will uphold such a claim on the part of contractor. The
heavy rain in a decade and assess the flood discharge.          govt should see the unit rates are not also abnormally
We should also take into consideration the reservoirs           high or low when compared to the estimate rates They
constructed along the river for flood moderation purpose.       may be kept within a range of 25% over the estimate rates,
Even then we can provide for :breaching sections in the         So that variation in quantities will not result in loss to govt.
flanks to help in cases of emergency.                           If a contractor quotes Rs.200 per unit for 100,000 units of
                                                                e.w costing Rs.100/- at estimated rates and a actually does
The savings in shifting the surplus courses or reducing         200,000 units he gets paid two crores against one crore
the no of gates need not go to the contractor but he may        estimated value. If it is restricted to Rs.125/- the govt will
be paid certain percentage of the savings say around 20%        save seventy five lakhs such abnormal rates need to be
towards his over head charges. No court will deny the           corrected with the concurrence of the contractor. If this is
right of the owner govt to get the benefit of the savings. If   strictly implemented losses of several crores can be
any confusion is there it may be set right and the              prevented.
contractors concurrence obtained. If this suggestion is
adopted we may save two hundreds crores of expenditure.         Quality control
                                                                It is most unfortunate to note that several projects
Change in Specification
                                                                constructed during the last 20 years are not able to store
                                                                                                                                     Jalayagnam ...

due to change in design or replacement of concrete into         50% of the water the project was designed while there
earthen bund the advantage should go to the govt and            are no such complaints about Nagarjuna Sagar, Sri ram
the contractor may be given 20% towards as over head            Sagar etc completed before 1983.
charges. Even an earthen bund is replaced by another of         The world bank while giving loan to Sriram Sagar insisted
cheaper composition the advantage should go to govt with        on our having quality control and we evolved a good
reasonable payment to contractor towards over head              system of quality control and the project can be considered
charges. This may result in a hundred crores savings.           as one among the best constructed projects in the world

                                                                                        19th February 2008    ||   FAPCCI Review   || 7
                 and I was incharge of quality control of the project. Also       diversion and also to help Thelengana which were not
                 the lack of quality in work and over payments if any in the      having even single established irrigation project by
                 present Jalayagnam projects is for want of direct                graveity by then.
                 involvement of staff and indiscriminate subletting of work.
                                                                                  To satisfy Thelangana sentiment equitable distribution of
                 An independent quality organization with powers to check         river water can be made and projects taken up. This will
                 bills paid, leads and lifts for supply of material and quality   help us to prevent water going waste into sea and
                 of work should function effectively. During the period of        complete the projects early.
                 execution of projects like Thungabhadra, Nagarjuna Sagar,
                                                                                  It may also be noted that there is no alternative for major
                 Sriram Sagar etc politicians and bureaucrats were never
                                                                                  river valley projects as one acre submerged will irrigate
                 interfering with the mode of execution of projects with the
                                                                                  not less than 20 acres while producing power where as
                 result proper quality could be maintained and works done
                                                                                  medium and minor irrigation barrage schemes can irrigate
                 most economically.
                                                                                  only 3 to 5 acres without producing power.
                 But now instructions are issued by bureaucrats and
                                                                                  Lift irrigation schemes are highly expensive and may be
                 politicians for mode of execution of projects, payments
                                                                                  taken up only after major project is completed with canals.
                 etc with no personal responsibility. Unofficial payments
                                                                                  Canal alignments can be changed during the course of
                 are demanded by local politicians from contractors. Hence
                                                                                  actual execution considering the depth of cutting or hight
                 it is desirable to treat all such persons that interfere with
                                                                                  of embankment and substantial savings can be affected.
                 works as govt servants and punish them under appropriate
                                                                                  The owner the govt has got every right to adopt such
                 rules of procedure by courts specially sanctioned for the
                                                                                  alternatives that affect savings and the savings will accrue
                                                                                  to the govt only. Hence it is desirable that payment are
                 It may be desirable for the govt to appoint as secretary for     made on actual work done and not on a lump sum basis.
                 works departments the senior most Chief Engineer to stop         It is desirable to renew the agreement and a workable
                 the trend of non technical people taking decision and            arrangement arrived at “even now so that the govt may
                 wasting funds. This process is being implemented in              avoid huge payments later due to litigation.
                 Maharastra, Orissa and other states and will release some
                 I.A.S officers to work in more important of and                  Even though giving advances to contractors may not be
                 administrative posts. Even though present day Engineers,         objectionable as it helps the contractors to ‘quote less
                 Politicians are capable for want of historical back ground       rates it is not correct to pay agreement amount if the
                 of the projects completed and uncalled for rigged up             contractor has done less quantity of work. It is neither
                 regional feelings people are in a confused state of mind         legally nor morally I correct. This needs to be set right
                 creating unnecessary controversies resulting in slowing          immediately.
                 down the progress of execution of projects. Polavaram            Production of hydropower may be taken up in medium
                 Project across Godavary was investigated report finalized        irrigation projects such as Modi Kunta vagu etc. This will
                 and generally approved in 1948 by central govt and an            be quite economical and substantial power can be
                 expert by name Tera Zago was brought from U.S.A. and             generated.
                 he inspected the project site and readily agreed to take
                 up the work and complete it in 7 years. Unfortunately at         Adoption of some of the above suggestions may result
                 that time the farmer ’” Madras govt was pursuing                 not only in savings of several thousands of crores of
                 enthusiastically a project to divert Krishna water into          rupees but also help in early completion of work. And get
                 Cauvery and the state govt had to keep Polavaram in              proper value for the money spent.
                 abeyance and to take up Nagarjuna Sagar to prevent
Jalayagnam ...

      8 || FAPCCI Review || 19th February 2008
Mr. Sam Pitroda, the learned and respected Chairman of            to growth and competitiveness has also achieved
National Knowledge Commission in the Foreword of his              significant prominence since the start of economic
2nd Report to the Nation submitted in 2007 lauded the             liberalization in India. The NKC Survey further highlights
education agenda outlined in the XI Plan. The plan places         crucial parameters at the firm level that have enabled
high priority on education as a central instrument for            some firms to be more innovative than others, including
achieving rapid and inclusive growth with specific                the role of structural frameworks and processes. It is
emphasis on expansion, excellence and equity as it                expected that dissemination of the survey results across
reflected in the proposed allocation of Rs.3 trillion, a five     India’s industrial spectrum will highlight best practices in
fold increase over the Xth plan. By this the share of             industry and thereby also generate catalytic impact on a
education in the total plan well increase from 7.7 to 20%.        wider scale.
In his report he has made several recommendations on              However, it is pertinent to point out that the most critical
various subjects and out of which ‘INNOVATION’ is one.            external barrier for both large firms and small and medium
It is reproduced below for the benefit and use of                 enterprises is skill shortage arising out of lack of emphasis
educational institutions. Industrial community and all other      on industrial innovation, problem-solving, design,
stakeholders who deal with it directly or indirectly.             experimentation, etc in the education curricula. There is
                                                                  also need for more effective collaboration between
The National Knowledge Commission identified the role             industry, universities and R&D institutions. Systematic
of innovation as one of the key factors in India’s economic       reform of the higher education system (including skill
growth. Innovation is a process to achieve measurable             based marketable vocational education) in India is
value enhancement in any commercial activity, through             essential to develop the required intellectual capital as
introduction of new or improved goods, services,                  well as generate effective synergies among industry,
operational and organizational process. It is a significant       government, the educational system, the R&D
factor in facilitating competitiveness, improvement in            environment and the consumer. Innovation is a complex
market share and quality as well as reduction in costs.           activity that requires widespread interaction across the
NKC conducted a nationwide survey among large firms,              entire economy, from the grassroots to the large firm level.
as well as small and medium enterprises to explore the            NKC recommends a comprehensive campaign to address
role being played by innovation in fuelling India’s economic      these issues and to spur efforts to make India a global
growth. The NKC Survey reveals that Innovation Intensity          leader in innovation.
(i.e. the percentage of revenue derived from products/
services which are less than 3 years old) has increased                                           Courtesy: NKC Report, 2007
for large firms as well as small and medium enterprises.                                         Compiled by A.Sanyasi Rao,
The strategic prioritization of innovation as a factor critical         Consultant, Export Promotion and Investments.FAPCCI

                                                                                         19th February 2008   ||   FAPCCI Review   || 9
                       We are living in times when increasingly, the ties between       forms of economic and political interaction. The inclusion
                       India and the Asia Pacific region are being revived. For a       of Oceanian countries such as Australia and New Zealand
                       long time, trade ties between India and the Asia Pacific         is largely based upon the economic relationships between
                       were being seen as a springboard for our globalization           those countries and their East Asian trading partners to
                       plans. Former PM Narasimha Rao was a strong supporter            the north. In some contexts, the region may extend further
                       of these linkages. India’s economic reforms and integration      to include major Asian countries, as well as those around
                       into the global economy have made the restoration of our         the Pacific Rim, stretching from Oceania, up to Russia,
                       ties with the Asia Pacific region an inevitable and natural      and down the western coast of the Americas. The Asia-
                       consequence. Secondly, there’s India’s historical and            Pacific Economic Cooperation, for example, includes
                       cultural ties with a number of East and South-East Asian         Canada, Chile, Russia, Mexico, Peru, and the United
                       countries.                                                       States.

                       It is to be noted that the Asia Pacific region is one that       No look at the Asia Pacific region will be complete without
                       has experienced the most rapid development in the world          a detailed look at the Asia Pacific Economic Cooperation
                       in recent years. Since 1980s, the trade in Asia Pacific          (APEC), founded in 1989 and headquartered in Singapore.
                       region has grown rapidly. Till 1980s, its trade volume has       APEC is a forum for 21 Pacific Rim countries to discuss
                       already outnumbered 900 billion US$, accounting for              the regional economy, cooperation, trade and investment.
                       65.6% of the total trade volume of all regional cooperation.     APEC is the only inter governmental grouping in the world
                       The countries of the Asia Pacific alone supposedly               operating on the basis of non-binding commitments, open
                       represent 52% of the international trade and 49% of the          dialogue and equal respect for the views of all participants.
                       world GDP. Trade among APEC economies is significant             Unlike the WTO or other multilateral trade bodies, APEC
                       and growing. Intra-APEC merchandise trade has more               has no treaty obligations required of its participants.
                       than doubled since 1994, from US$1.4 trillion to over US$3       Decisions made within APEC are reached by consensus
                       trillion. The Asia Pacific has three members of the UN           and commitments are undertaken on a voluntary basis.
                       Security Council,seven members of the DECD and four              APEC’s 21 members referred to as ‘Member Economies’
                       ofthe G-8. Within a short period of 20 years, the scope of       include: Australia; Brunei Darussalam; Canada; Chile;
                       Asia-Pacific       cooperation has really expanded. All this     People’s Republic of China; Hong Kong, China; Indonesia;
                       growth is quite commendable considering that the                 Japan; Republic of Korea; Malaysia; Mexico; New
                       economic modes and development levels of all Asia Pacific        Zealand; Papua New Guinea; Peru; The Republic of the
                       countries are quite disparate. Secondly, the nations and         Philippines; The Russian Federation; Singapore; Chinese
                       cultures of all Asia Pacific countries are largely diversified   Taipei; Thailand; United States of America; Vietnam. The
Future’s bright.....

                       and complicated.                                                 activities, including year-round meetings of the members’
                                                                                        ministers, are coordinated by the APEC Secretariat. The
                       At this juncture, let’s look at what the term Asia-Pacific
                                                                                        organization also conducts the APEC Economic Leaders’
                       encompasses. It generally applies to littoral East Asia,
                                                                                        Meeting (AELM), an annual summit attended by the heads
                       Southeast Asia and Australasia near the Pacific Ocean,
                                                                                        of government of all APEC members except Chinese
                       plus the states in the ocean itself (Oceania). The term
                                                                                        Taipei, which is represented by a ministerial-level official.
                       Asia-Pacific became popular in the late 1980s as the
                                                                                        The most recent summit, APEC Australia 2007, was
                       economies within the heterogeneous region flourished on
                                                                                        concluded in Sydney on September 9, 2007. Its
                       account of increased regional capital flow, trade and other

        10 || FAPCCI Review || 19th February 2008
contribution to the Asia-Pacific region and the world at         with hotels and restaurants, construction and transport.
large could be categorized into the following three aspects.     Agriculture, however, reported sharp drop in employment.
Firstly, APEC has always stood at the forefront of regional      Textile and clothing exports account for a very high share
and global economic development adapted itself to the            of total merchandise exports in some Asia-Pacific
latest economic situation and characteristics in the region      countries such as Cambodia (71 per cent), Pakistan (68
and the world and played an important guiding role in            per cent) Bangladesh (59 per cent) and Sri Lanka and
addressing the acute economic problems therein.                  Nepal (both around 50 per cent). Many governments in
Secondly, APEC has taken firm steps on the basis of              the region however, have been neglecting agriculture and
respect for diversity and helped develop the multilateral        investing far less in rural development. Trade liberalisation
trading system in line with the principle of ‘open               itself has often undermined national food production by
regionalism’, Thirdly, APEC has developed in a way that          allowing imports of cheap food. These will benefit low-
reflected the broadest common interests of all its members       income consumers, but they can also threaten the
and adopted more effective cooperation modalities to             livelihoods of poor farmers and fishing communities with
narrow the gap between its members and hence,                    serious implications for equity. Intense competition in
enhanced their cohesion. This aspect is especially               open-access fisheries is leading to overfishing in several
important considering that the pattern of trade in Asia          commercially important sectors. The Asian fishing sector
Pacific and its buoyancy has been mixed, and individual          also faces problems of accessing advanced country
economies have performed unevenly. Generally, China,             markets where there are increasing demands for higher
Singapore, Thailand, Korea,Malaysia continue to account          standards of food safety.
for the major share of FDI flows into Asia Pacific. Other
                                                                 India and the Asia Pacific region
countries, such as Philippines, Vietnam, Cambodia, have
experienced a greater range of ‘peaks and toughs’. The           Though India is increasingly becoming important to Asia
time hasn’t come for this region to rejoice completely. As       and the Pacific, its membership in APEC, is considered
per a UNDP report, while the Asia Pacific economy as a           years away. While Indian membership would be
whole created 337 million jobs in the booming 1980s, it          ‘convenient’ for APEC, it will have to negotiate membership
managed to create barely half that - 176 million in the          according to World Trade Organisation regulations and
1990s, the period coinciding with trade expansion. While         gain consensus support from existing members, a process
Asia Pacific clearly has reason to be proud of its significant   that would likely take several years and also depend on
overall trade gains in relation to the rest of the world, it     Doha global trade talks. APEC, does not intend to approve
has to make a conscious effort to deal with issues of            any new members until 2010, with ,membership becoming
joblessness, which it faces even today.                          effective the next year. It is believed that the first new
                                                                 Asian member may come from Southeast Asia.
Sectors that have gained the most employment

Big gainers in services include the financial, insurance
and business sectors, with a 67 per cent increase, along                   Source: ECGC News, October-December 2007                Future’s bright.....

    A bill further to amend the Andhra Pradesh Charitable and Hindu religious
    institutions and Endowments Act 1987 has been introduced inthe A.P. Legislative
    Assembly on 28th March, 2007.

                                                                                      19th February 2008   ||   FAPCCI Review   || 11
                  (Income Tax)

                  Expert group to review costing standards and                      earn the favour of the electorate before the oncoming elections
                  cost audit:                                                       to assemblies this year and Parliament next year than the
                                                                                    presentation of the Budget with popular proposals relating to
                  Breathing fresh hopes into cost accounting and cost audit is      taxation.
                  a new order from the Government. “Cost accounting, through
                  the determination and allocation of costs to various products,    I-T DEPTT DETECTS TAX EVASION OF OVER RS.100
                  provides a valuable service to the managements of companies       CRORE DURING SURVEYS:
                  in cost analysis and control,” reads a recent communication         Income Tax Department had recently carried out a search
                  from the Ministry of Corporate Affairs constituting an Expert     operation against a group of Gurgaon engaged in
                  Group to review the existing Cost Accounting Standards and        development of real estate and running a private airline. On
                  Cost Audit Report Rules.                                          the basis of evidence collected during that search, surveys
                                                                                    were subsequently conducted by the Department at 11
                  Demat of TDS certificates may be deferred
                                                                                    different locations in Delhi, Mumbai and Gurgaon on two
                  again:                                                            leading groups of builders having close business connections
                  Dematerialisation of tax deducted at source (TDS) certificates    and transactions with the group searched earlier.
                  is likely to be deferred by a year from the proposed date of      States should be given power to levy service tax:
                  April 1, 2008. The scheme was originally scheduled to come
                  into effect from April 2005, but was deferred twice. “Demat of    ANDHRA Pradesh is among the few states that has not raised
                  TDS certificates is likely to be deferred by a year or at least   tax rates and power tariffs over the last four years. But our
                  six months,” a finance ministry official said. An announcement    tax revenues have been buoyant, thanks in a large measure
                  is expected in the Budget.                                        to higher collections from value added tax (VAT). More
                                                                                    importantly, the state’s economy is on a roll and this has
                  Foreign firms‘ capital asset sale may fall in tax                 brought in more revenues to meet our expenditure
                  net:                                                              commitments. The state is posed to achieve a GDP growth
                                                                                    rate of 10.37% in 2007-08 as against 8.87% for in 2006-07.
                  The Central Board of Direct Taxes (CBDT) has proposed that
                  the sale of capital assets of a company operating in India, but   Case Law of the week:
                  registered overseas, in an international merger and acquisition
                                                                                    Power of Appellate Tribunal
                  (M&A) deal should be brought under the tax net via an
                  amendment in the Income Tax Act, 1961. Accordingly, it has        C.I.T. vs. Kamal Bhai Ismilji
                  proposed to the department of revenue to expand the list of       (2005) 149 Taxman 558 (All.)
                  taxable transactions covered under Section 9 of the Income        Case Fact: Whether appellate tribunal is justified in recalling
                  Tax Act. This section deals with deemed profits and enlists       its earlier order on assessee second application where it had
                  various items where the income of a foreign entity is taxed in    rejected the first application of the assessee.
Income Tax News

                                                                                    Decision: Held by Hon‘ble court that though appellate tribunal
                  It’s time to levy a flat tax:                                     has power to rectify mistakes apparent from record but it does
                                                                                    not has power to review. In present case, there was no mistake
                  Apart from simplifying the tax system enormously, with some
                                                                                    on the part of tribunal in its first rejection order. Hence, tribunal
                  modifications in the tax regime, a flat tax will also result in
                                                                                    was not justified in recalling its earlier order since it amounted
                  higher tax collections. The Central Budget will be presented
                                                                                    to review of first rejection order.
                  to Parliament by the end of the month. The elections to a few
                  state assemblies last year revealed the vulnerability of the                                        Compiled by: - Hari Agarwal, FCA
                  Congress party to defeat. There is no better opportunity to
                                                                                    Source: PDICAI Knowledge Capsule

      12 || FAPCCI Review || 19th February 2008
                           ELECTORAL ROLL 2008- 09 – SPECIMEN SIGNATURES
                                                   UNDER ARTICLE 7(D) OF
                                           THE ARTICLES OF ASSOCIATION OF FAPCCI

The Electoral Roll of the Federation for 2008 - 09 is being revised. The Electoral Roll Form- 2008 - 09 is printed on
page-15 and members are requested to return it duly filled-in at the earliest, giving the following essential
details without fail.

01. Names of three (3) representatives in order of their seniority for voting at the general body meetings of FAPCCI.
    All categories of members except individuals need to give this information.

02. Two specimen signatures of each representative in the same form against their names.

03. Individual members to indicate their name, address, telephone numbers, etc., and affix specimen signatures for
    our records.

04. Only one representative can exercise the vote at any meeting. Other representatives are welcome to attend the

05. Only those members who are on the Electoral Roll of the Federation as on 31st March, 2008, will be eligible to
    participate in the forthcoming AGM and elections to the Managing Committee (Attention is drawn to Article 7 of
    the Articles of Association of the Federation, reproduced hereunder).

Please arrange to return the Form duly filled-in and signed for updating the information of your Organization in the our
records. In the absence of information in the Electoral Roll Form, the Federation takes it that there are no
changes in the details of your organization available with the Office of the Federation. The same will be used
for preparation of Electoral Roll,mailing of communications including invitations to meetings, etc.
Article 7 of the Articles of Association of the Federation.

7.     Subject to the provisions and restrictions of these Articles, the rights and privileges of membership may be

as amended                  In the case of a firm or partnership elected in their conventional name as a member of the
on 15.01.98                 Federation, by any partner in such firm or partnership or by such persons authorised by the Firm
                            to the satisfaction of the Managing Committee to sign the name of the firm or partnership or to                                            Electoral Roll 2008-09
                            sign such name as per procuration;

                            and in the case of a company or corporation elected in its corporate name as a member of the
                            Federation, by a Director, Manager, Secretary or any other responsible officer of the company
                            or corporation or a person authorised by a resolution of its Board to exercise the same on behalf
                            of the company or corporation.

as amended                  and in the case of an association affiliated to the Federation by its President,Vice-President,
on 15.01.98                 Treasurer or Secretary or such other person authorised of the affiliate of association as may be
                            authorised by a resolution of its Committee.

                                                                                                                19th February 2008          ||   FAPCCI Review    || 13
                                          Subject, nevertheless, to the following reservations:

                         as amended       (a) The representative of a firm or partnership company or on corporation, small scale industry or
                         on 15.01.98      affiliated association entitled to exercise the rights and privileges of membership must have their
                                          names registered in books of the Federation in order to exercise the aforesaid rights and privileges
                                          on or before 31st May of that year.

                                          (b) For each act of exercise of the rights and privileges of membership by a firm or partnership, company
                                          or corporation, or affiliated association, only one representative shall be recognised.

                         as amended       (c) Only one registered representative of a firm or partnership company or corporation, small scale
                         on 15.01.98      industry or affiliated association, shall be entitled to attend a General Meeting of the Federation and
                                          take part therein.

                         as amended       Provided, however, that at a General Meeting of the Federation, if the original nominee is not present,
                         on 15.01.98      an alternative representative may be appointed subject to any changes as indicated at 7 (a) above.

                         as amended       (d) Every representative shall send his specimen signature to the Federation,which shall be registered
                         on 30.04.77      with the Federation. Whenever there is a change in the representation, the new representative should
                                          also send his specimen signature for such registration.

                                              ANNUAL SUBSCRIPTION FOR THE YEAR 2008-09

                            Members may kindly note that the Subscription Bills for the year 2008-09 have been
                            posted to all the members.
                            As per Article 9(ii) of the Articles of Association of the Federation, every member shall be
                            liable to pay in advance the annual subscription on or before the day of 31 st March, for
                            the ensuing year.
Electoral Roll 2008-09

                            Please remit your subscription for the year 2008-09 and arrears, if any, on or before
                            31st March, 2008, to enable us to place your name on the Electoral Roll for the year
                            2008-09. Please note that the members who do not pay their arrears and subscription
                            for the year 2008-09, on or before 31 st March, 2008, are not eligible to participate in
                            the elections to the Managing Committee – 2008-09.

                            M. HEMALATA

         14 || FAPCCI Review || 19th February 2008
                                             Electoral Roll 2008-09

19th February 2008   ||   FAPCCI Review   || 15
                                                            PRODUCTS / SERVICES
                         Code No.      Product / Service             Code No.      Product / Service

                          01.       100% EOUs                         45.       GLASS
                          02.       ADVOCATES                         46.       GRANITES
                          03.       AGRICULTURE                       47.       HANDICRAFT
                          04.       ALUMINIUM                         48.       HATCHERY
                          05.       ANIMAL FEED                       49.       HOSPITAL
                          06.       ASSOCIATIONS                      50.       HOTEL
                          07.       AUTOMOBILE                        51.       INSURANCE
                          08.       BAKERY                            52.       IRON AND STEEL
                          09.       BANKS                             53.       JEWELLERY
                          10.       BATTERY                           54.       JUTE
                          11.       BEARINGS                          55.       LEATHER
                          12.       BLADES                            56.       LIQUOR
                          13.       CASTINGS                          57.       MACHINERY/MACHINE TOOL
                          14.       CEMENT & ASBESTOS                 58.       MEDICAL & INDUSTRIAL GASES
                          15.       CERAMICS                          59.       MEDICINES
                          16.       CHAMBERS OF COMMERCE              60.       MINING
                          17.       CHARTERED ACCOUNTANTS             61.       MOTORS
                          18.       CHEMICALS                         62.       OILS
                          19.       CHITFUNDS                         63.       PACKAGING
                          20.       CLEARING & FORWARDING AGENTS      64.       PAINTS
                          21.       COAL                              65.       PAPER
                          22.       COFFEE                            66.       PESTICIDES/INSECTICIDES
                          23.       COMPUTERS                         67.       PETROLEUM
                          24.       CONSTRUCTION                      68.       PHARMACEUTICALS
                          25.       CONSULTANTS                       69.       PLASTICS
                          26.       COSMETICS, SOAPS & TOILET         70.       PLYWOOD
                                    PREPARATIONS                      71.       POLYESTER
                          27.       COTTON & TEXTILE                  72.       POWER
                          28.       CYLINDERS                         73.       PRESS
                          29.       DAIRY PRODUCTS                    74.       PRINTING
                          30.       DISTRIBUTORS / AGENTS/TRADERS,    75.       RICE
                                    WHOLESALERS / RETAILERS/          76.       RUBBER
                                    COMMISSION AGENTS                 77.       SANITARY
                          31.       ELECTRICALS                       78.       SEAFOODS
Electoral Roll 2008-09

                          32.       ELECTRONICS                       79.       SEEDS
                          33.       ENGINEERING                       80.       SILK
                          34.       ENGINEERS / CONTRACTORS           81.       SOFTDRINKS
                          35.       EXPLOSIVES                        82.       STATIONERY
                          36.       EXPORTERS                         83.       STEEL REROLLERS
                          37.       FERRO ALLOYS                      84.       SUGAR
                          38.       FERTILISERS                       85.       TAX CONSULTANTS
                          39.       FILM                              86.       TEA
                          40.       FINANCIAL INSTITUTIONS            87.       TELEPHONES
                          41.       FLOUR MILLS                       88.       TOBACCO & BEEDI
                          42.       FOOD                              89.       TRANSPORT
                          43.       FURNITURE                         90.       WIRE& CABLES/PIPES
                          44.       GARMENTS                          91.       OTHERS

         16 || FAPCCI Review || 19th February 2008
                                Entry Tax Act - Unconstitutional -A.P. High Court

W.P.Nos.615 of 2002, 931 of 2002, 1535 of 2002, 21867 of 2004, 21909 of 2006, 14802 of 2006, 16029 of 2006,
16030 of 2006, 21525 of 2006, 21557 of 2006, 21806 of 2006, 21807 of 2006, 21859 of 2006, 21906 of 2006, 21911
of 2006, 22618 of 2006, 24398 of 2006, 24399 of 2006, 26568 of 2006, 26569 of 2006, 26570 of 2006, 26571 of
2006, 5484 of 2007, 3000 of 2007 and 13533 of 2007
(Per the Hon’ble Sri Justice Nooty Ramamohana Rao)
        Constitutional validity of Sections 3 and 4 of the A.P. Tax on Entry of Goods into the Local Area Act of 2001,
together with the notifications issued thereunder, has been questioned in this batch of cases.
         The State of Andhra Pradesh enacted the A.P. Tax on Entry of Goods into the Local Area Act of 2001; Act
No.39 of 2001 (henceforth referred to as ‘the Entry Tax Act’ for brevity). Section 3 of the Entry Tax Act is the charging
provision, which enabled the levy and collection of tax on the entry on notified goods into any local area for sale,
consumption or use therein. This levy of entry tax is characterized as unconstitutional principally for the reason that it
is discriminatory and it also impedes and restricts the free movement of trade and commerce, guaranteed across the
Federal Polity under Article 301 of our Constitution and for that reason also it is bad. It is further contended that the
Presidential consent, which is so essentially to be obtained prior to the introduction of the Bill, needed in terms of
Clause (b) of Article 304 of our Constitution having not been obtained, the impugned Entry Tax Act which seeks to
impose restrictions on the freedom of trade and commerce, should be declared as invalid.
         Before we further elaborate the contentions canvassed on both sides, it will be relevant to notice the salient
features of the Entry Tax Act.
         Prior to enacting the present Entry Tax Act, the Governor of Andhra Pradesh has promulgated the A.P. Tax on
Entry of Goods into the Local Area Ordinance 2001; Ordinance No.1 of 2001. Present Entry Tax Act replaces the said
Ordinance No.1 of 2001. The statement of objects and reasons set out in the Bill indicate that in order to protect the
interests and revenues of the State as some of the neighbouring States are found indulging in trade diversion by
reducing the rates of taxes for certain goods than those levied in the State of Andhra Pradesh for such goods.
         Various expressions found in the Entry Tax Act are defined in Section 2. The expressions “entry of goods into
a local area” and “importer” are defined in sub-sections (e) and (h) of Section 2 in the following manner :
Section 2(e) – “Entry of goods into a local area” with all its grammatical variations and cognate expressions, means
entry of notified goods into a local area from any place outside the State for consumption, use or sale therein;
Section 2(h) – “Importer” means a person who brings or causes to any notified goods whether on his own account or
on account of a principal or any other person, into a local area, from any place outside the State for consumption, use
                                                                                                                                Entry Tax Act.....

or sale therein or who owns the notified goods at the time of entry into the local area from any place outside the State.
The charging provision Section 3 reads as under :
“Section 3 – Levy and collection of tax”-
(1)   (a)   There shall be levied and collected a tax on the “entry of the notified goods into any local area” for sale,
            consumption or use therein. The goods and the rates at which, the same shall be subjected to tax shall be
            notified by the Government the tax shall be on the value of the goods as defined in clause (n) of sub section

                                                                                   19th February 2008   ||   FAPCCI Review   || 17
                                 (1) of Section 2 and different rates may be prescribed for different goods or different classes of goods or
                                 different categories of persons in the local area;
                           (b)   the tax shall be payable by the importer in such manner and within such time as may be prescribed;
                           (c)   the rate of tax to be notified by the Government in respect of any commodity shall not exceed the rate
                                 specified for that commodity under the Andhra Pradesh Value Added Tax Act, 2005 or the notifications
                                 issued thereunder :
                           Provided that the tax payable by the importer under this Act shall be reduced by the amount of tax paid, if any
                           under the law relating to General Sales Tax in force in Union Territory or State in which the goods are purchased.
                     (2)   Notwithstanding anything contained in sub-section (1), no tax shall be levied on the notified goods imported by a
                           dealer registered under the Andhra Pradesh Value Added Tax Act, 2005 who brings such goods into any local
                           area for the purpose of resale in the State of Andhra Pradesh or during the course of inter-state trade or commerce;
                           Provided that if any such dealer, after importing the notified goods for the purpose of resale, consumes such
                           goods in any form or deals with such goods in any other manner except reselling the same, he shall forthwith
                           notify the assessing authority by the 20th of the month, succeeding the month in which such goods are so consumed
                           or dealt with and pay the tax, which would have been otherwise leviable under sub-section (1), along with interest
                           for the period of delay at the rate of 19% per annum compounded quarterly.
                     (3)   If any dealer having imported the notified goods for the ostensible purpose of resale deals with such goods in any
                           other manner or consumes the same and does not notify to the assessing authority as provided in sub-section
                           (2) or does not pay the tax as required in sub-section (2) within the specified period, the assessing authority shall
                           assess the amount of tax which such dealer is liable to pay and levy penalty equal to the amount of tax due, apart
                           from collecting interest from the date of entry of goods into the local area.”0
                           A perusal of these provisions makes it clear that the levy and collection of tax on entry of notified goods into a
                           local area from any place outside the State for consumption, use or sale therein has been authorized. Entry of
                           the notified goods from one local area to another local area within the State is not subject to the levy. In other
                           words, intra-state movement of notified goods is not subjected to the tax. Therefore, learned counsel for the
                           petitioners, urge that that such of those importers who secure movement of the notified goods into a local area
                           situate within the State of Andhra Pradesh from a place outside the limits of Andhra Pradesh are discriminated
                           against while leaving out from the tax net of the notified goods brought into the limits of a local area from yet
                           another local area within the State. Learned counsel for the petitioners have illustratively highlighted their
                           contention by pointing out that if the notified goods are brought into the local area of Hyderabad from the local
                           area at Visakhapatnam, they are not subjected to entry tax as both these local areas are situate within the limits
                           of Andhra Pradesh whereas if the notified goods manufactured at Bombay are brought into the local area limits
                           of Hyderabad, such notified goods are subjected to the entry tax. Therefore, according to the learned counsel,
                           it is plain discrimination shown by preferring such local manufacturers within the State of Andhra Pradesh and
                           the manufacturers situated outside the State of Andhra Pradesh are thus discriminated. Since imposition of any
                           tax implies in itself a certain degree of impediment on the freedom of trade, commerce and intercourse guaranteed
                           through the federal polity under Article 301 and hence for this violation of the guarantee under Article 301 also,
                           according to the learned counsel the impugned levy of entry tax is unconstitutional. Since the impost is an
Entry Tax Act.....

                           unreasonable restriction on the freedom of trade and commerce, the same is not liable to be brought on to the
                           Statute book without obtaining the previous sanction of the President as required under clause (b) of Article 304.
                           Since no such sanction was obtained, the Act is liable to be declared unconstitutional.
                     (The Fulltext of the Judgement can be had from FAPCCI.)


       18 || FAPCCI Review || 19th February 2008

Various judgements were pronounced by courts on                 Riazuddin Khan V. State of M.P. 2006 LIC 285 (M.P.H.C)
compassionate appointments. After observing the recent
judgements, it was made clear that the compassionate            Appointment – Compassionate-
appointments are not automatic and they have to fulfill         Not a source of recruitment after 18 years.
certain criteria mainly with the death of bread winner and
also it is to be proved that the family is in misery, unable    Petitioner Corporation challenges direction of Industrial
to lead the life and in a distressed condition. Further, they   Court to give compassionate appointment to respondent
should satify the criteria laid down by their organizations.    no.1 who was minor at the time of death of his father
By getting substantial retrial benefits of the deceased, the    (employee).
dependents cannot be said to be in miserable conditions.
                                                                Held: The scheme of providing compassionate
Decision has to be taken by the employer whether or not
the dependents falls under the category of penury. The          appointment is not a source of recruitment or for reserving
discretion of the employer is paramount.                        future vacancies for minors of deceased employees.
                                                                Object of scheme cannot be fulfilled by providing
The object of the appointment is only to assist the family      employment or compassionate grounds after a lapse of
in case the dependents are under miserable conditions           long period of 18 years. Object of the scheme is to help
due to death of the bread winner.                               the family which falls in sudden and unexpected distress.
Recent judgements in supporting of it are furnished here        Maharashtra State Road Transport Corporation v.
under. However it is to be understood that the scheme of
                                                                Devendra Puranlal Birchha 2006 I CLR 179 (Bom.H.C.)
compassionate appointments is not altogether abolished,
the finer values of helping the employees and their family      Appointment – Compassionate -
members in the event of necessity are to be retained by         Delay and Laches.
the employers. The courts only put an end to those who
wants to take undue advantage or misuse of the welfare          On the death of the father of respondent on 6.3.1987 while
scheme.                                                         he was in service. Respondent applied for compassionate
                                                                appointment on 20.9.1991. State took decision in March
Appointment – Compassionate-
                                                                1996 not to give such appointment. Writ petition thereon

                                                                                                                                  Compassionate Appointments
claim after 5 years.                                            is dismissed. However writ appeal is allowed and hence
Petitioner was minor when his mother died. He put up            this appeal to Supreme Court.
claim 5 years thereafter on his becoming major. In view
                                                                While allowing the appeal, it is held as follows: Once it is
of lapse of time of 5 years, rejection of his claim for
                                                                established that inspite of death of bread earner, the family
compassionate appointment is proper.
                                                                survived and substantial period was over, there was no
Ravi Dhankar v. Union of India 2006 LIC 524 (Del. – D.B.)       necessity to say “good bye” to normal rule of appointment
                                                                and to show favour to one at the cost of others ignoring
Appointment – Compassionate-                                    the mandate of Art. 14 of the Constitution of India. Learned
Application after lapse of 12 years.                            Single Judge was right in dismissing petition on ground
The application of compassionate appointment was filed          of delay and laches. Division Bench was not justified in
after lapse of 12 years. The delay is tried to be explained     setting aside judgement and order of Learned Single
by saying that applicant was minor at the time of the death     Judge.
of his father. However there is no averment when he
                                                                State of J.& K. v. Sajad Ahmed Mir 2006 III CLR 6 (S.C.)
became major. Application is liable to be dismissed.

                                                                                     19th February 2008   ||   FAPCCI Review   || 19
                             Appointment – Compassionate –                                 Malathi Mohan Raman v. Syndicate Bank, Manipal 2006
                             Rightly declined in view of financial                         III CLR 683 (Karn.H.C.)
                             condition of family.                                          Appointment – Compassionate- Rejection was proper
                                                                                           Respondent’s request for compassionate appointment
                             It is held by Supreme Court in this case that appellant –
                                                                                           made in 1997 on account of death of his father in 1982
                             Bank has rightly declined compassionate appointment
                                                                                           while in service was rejected by petitioner was in
                             after taking into consideration the financial condition of
                                                                                           consonance with the settlement under which appointment
                             the family of deceased. The same included terminal
                                                                                           on compassionate ground. Hence this petition.
                             benefits amounting to Rs. 5,57,495/-, family pension of
                             Rs. 4,468/-. The financial condition is much above the        While allowing the petition, it is held that rejection by
                             criterion fixed in the new scheme for such appointments.      petitioner was in consonance with the settlement under
                                                                                           which appointment on compassionate ground is to be
                             Union Bank of India & Ors. V. M.T. Latheesh 2006 III LLJ
                                                                                           made. The direction of the tribunal is against the object
                             791 (S.C.)
                                                                                           and purpose for which compassionate appointment is to
                             Appointment – Compassionate –                                 be made. In case of minor. Application has to be made
                                                                                           within a period of ten years if he attains majority within 10
                             Family not in distressed condition.
                             Employee of respondent was retired on medical ground.
                                                                                           Gujarat State Road Transport Corporation v. Katankumar
                             He received Rs. 3 Lacs as retrial benefits and is also
                                                                                           Narendrabhai Singala 2006
                             receiving pension. In view of above his family cannot be
                             said to be in penury or in a distressed condition and as      I CLR 1075 (guj.H.C.)
                             such dependent of said employee is held not entitled to
                             compassionate appointment.                                    Appointment – Compassionate or Contract- Contract
                                                                                           was job contract
                             V. Prasanthi v. State Bank of India 2006 LIC 843 (A.P.H.C)
                                                                                           Appellant is a public undertaking fully owned by
                             Appointment – Compassionate-                                  Government of India. Several of its workers died in
                             Family cannot be said to be in penury.                        harness survived by widows and dependants. Some of
                                                                                           windows/dependants were given work by appellant on
                             Petitioner’s clam for compassionate appointment was           contract basis. Subsequently contracts were terminated.
                             rejected and hence this petition. On death of petitioner’s    On dispute being raised, Labour Court held that the
                             father, his mother is paid monthly pension of Rs. 4780/-      appointment were regular and not on contract basis.
                             and the family was extended various benefits to the tune      Labour Court passed award of reinstatement with back
                             of Rs. 3,93,709/- under various heads. Family of              wages. While dismissing writ petitions, High Court held
                             petitioners cannot be said to be in penury. In such           that there was a settlement and hence employees acquired
Compassionate Appointments

                             circumstances, rejection of claim cannot be said to be        statutory status and they were not contract labour. Hence
                             improper. Petition is dismissed.                              these appeals to Supreme Court.
                             S. Muralikrishna v. Bharat Sanchar Nigam Ltd. 2006 LIC        Held: Appointment on compassionate ground cannot be
                             541 (A.P.H.C)                                                 claimed as a matter of right. Die-in-harness scheme
                                                                                           cannot be made applicable to all types of posts
                             Appointment – Compassionate –                                 irrespective of nature of service rendered by deceased
                             Assessment of Penury condition.                               employee. To provide sustenance to the family members
                                                                                           of deceased workmen certain job works were given. The
                             Before rejecting claim for compassionate appointment,
                                                                                           cost of contract, the nature of work and the time allowed
                             Respondent – Bank had done assessment of penury
                                                                                           have been clearly indicated in each of the contracts. It
                             condition of family of deceased employee. One of the
                                                                                           also clearly indicates the number of persons to be engaged
                             factors of assess penury condition of family is the retrial
                                                                                           for carrying out the job contract works. There was no
                             benefits by the family. Family was getting around Rs.
                                                                                           material before Labour Court to conclude that the contract
                             12,000/- per month. Employer’s assessment of penury
                                                                                           was not a job contract and in fact employment had been
                             condition cannot be interfered with. Hence petition is
                                                                                           given. There is no foundation for such a conclusion.

           20 || FAPCCI Review || 19th February 2008
Impugned award and Judgement are set aside.                     specified in relevant G.R. His legal representative is not
                                                                entitled to compassionate appointment.
Indian Drugs and Pharmaceuticals Ltd. V. Devki Devi &
Ors. 2006 III CLR 24 (S.C.)                                     Rajendra Dattatraya Sawarkar v. State of Maharashtra
                                                                2006 LIC 3579 (Bom. D.B.)
Appointment – Compassionate- Dependants of workers
declared as surplus.                                            Appointment – Compassionate- Other similarly placed
                                                                was granted.
Mormugao Dock Labour Board (MDLB) passed a
resolution that dependants of workers declared as surplus       The case of the employee who was compulsorily retired
would be applied subject to fulfillment of required             does not fall in the category mentioned in Government
conditions. That created no obligation on Mormugao Port         Circular. Merely because management had granted
Trust as successor of MDI.B to follow the said resolution       compassionate appointment to similarly situated person,
either on principles of promissory estoppel or on ground        that does not give right in present case for such
of legitimate expectation. Defendants of surplus workers        appointment.
have no legal right that they be provided employment.
                                                                Rajendra Dattatraya Sawarkar v. State of Maharashtra
Sushant T. Karwarkar v. Mormugao Port Trust 2006 LIC            2006 LIC 3579 (Bom.- D.B.)
1633 (Bom – D.B.)
                                                                Appointment – Compassionate- Not entitled to.
Appointment – Compassionate- Rightly declined
                                                                An application for compassionate appointment was given
Petitioner’s father who is medically invalidated is receiving   about 17 years after the death of employee on the ground
retirement benefits, residing in his own house and is also      that claimant was minor. Even though said application
getting rental income from it. Petitioner is rightly held not   was rejected no steps were taken for 5 more years.
entitled to compassionate appointment.                          Second application was made thereafter. The claim is
                                                                not too stale. Family survived for more than 35 years
V. Sathayanarayan Murthi v. Assistant Director General,         now. Considering the object of giving such appointment,
Bharat Sanchar Nigam Ltd. 2006 LIC 3446 (Mad.H.C)               it is apparent that this petition has no merits and is
Appointment – Compassionate- Not within time                    dismissed.

As per Government Circular, Application for                     Kinnariben Champaklal Shah v. State of Gujarat 2006 LIC
compassionate appointment has to be made within 15              3691 (Guj. H.C.)
years from the date of compulsory retirement of employee.       Appointment – Compassionate- Not giving is proper.
In this case, such application was made beyond that
period. Hence petitioner is not entitled to such                Rejection of application for compassionate appointment
appointment.                                                    after considering financial condition of the family including

                                                                                                                                  Compassionate Appointments
                                                                terminal benefits received by family on death of employee
Rajendra Dattatraya Sawarkar v. State of Maharastra 2006        is proper and no interference is necessary.
LIC 3579 (Bom.- D.B.)
                                                                Vinod Kumar v. State Bank of India 2006 III LLJ 999 (P.&
Appointment – Compassionate- Case not falling in                H.-D.B.)
category specified in G.R.
Employee was compulsorily retired as his service was not
found satisfactory. Hence he does not fall in the category                                   Source: Current Labour Reports


                                                                                     19th February 2008   ||   FAPCCI Review   || 21
                                                                                     Trade & Commerce

                                                                       GOVERNMENT OF ANDHRA PRADESH

                         The Andhra Pradesh Tax on Professions, Trades, Callings and Employments Act, 1987 - Amendment of the First
                         Schedule of the Act - Orders - issued.

                                                                            REVENUE (CT.IV) DEPARTMENT

                         G.O.Ms.No.21                                                                                                                 Dated : 07-01-2008


                         In exercise of the powers conferred by Section 37 of the Andhra Pradesh Tax on Professions, Trades, Callings and
                         Employments Act, 1987, (Act No.22 of 1987) the Government of Andhra Pradesh herbey makes the following amendment
                         to the First Schedule of the said Act.


                         I.       The entry No. (1) of the First Schedule of the said Act relating to Salary & Wage earners shall be substituted
                         with the following :-

                                                                                          First Schedule
                                                                                        (Under Section 4)

                         Sl.No. Classes of Assessees or description                                                         Rate of Tax per
                                                                                                                            month (PM) or per Annum (PA)

                         1.         Salary and wage earners whose monthly salaries or wages in Rs.
                                    (i) Upto Rs.5,000                                                                                  NIL
                                    (ii) From 5,001 to 6,000                                                                           60 PM
                                    (iii) From 6,001 to 10,000                                                                         80 PM
G.O. on Profession Tax

                                    (iv) From 10,001 to 15,000                                                                         100 PM
                                    (v) From 15,001 to 20,000                                                                          150 PM
                                    (vi) Above 20,000                                                                                  200 PM

                         This amendment is deemed to have come into force on and with effect from 1-1-2008.

                                                                                                                                                          S.V. Prasad
                                                                                                                                   Principal Secretary to Government

         22 || FAPCCI Review || 19th February 2008
                       Office of the Commissioner of Commercial Taxes,
                                   Andhra Pradesh, Hyderabad
CCT’s Ref.No. I.I(2)/669/1997                                                                        Dated : 09-05-2007
                        Smt. Ranjeev R. Acharya, I.A.S., Commissioner of Commercial Taxes
        Sub:- APVAT Act - Levy of tax on software - certain clarifications - issued - Reg.
        Ref:- DC (CT), Hyd (Rural) vide Ref.No. S9/194/07, dt.21-04-2007.

         The DC (CT), Hyderabad (Rural) Division vide reference cited has requested for certain clarifications on levy
of tax on software products and services. The clarifications sought for are . . .
1.     Whether software developed as per customer requirements i.e., custom made software for the
       clients exclusive use is goods/services.
2.     Whether consultancy charges for software services rendered by software Engineers at clients
       premises is goods/services in view of the transfer of intellectual property.
3.     Whether implementation charges of existing software is goods/service.
Since the issues involved in these matters relate to software industry in general, the clarifications sought for are issued
in the form of a circular.
       The term “software programme” or “software” in short essentially refers to the series of commands issued to a
computer to perform certain functions. The software programmes are usually recorded on floppy drives or CDs or hard
drives. The programmes on these floppy drives on CD’s are installed onto the hard disc of the computer in order that
the programme can function. The Honourable Supreme Court in the case of TATA Consultancy Services Vs. State of
A.P. (39 APSTJ 205 (SC) examined at length the question as to whether computer software on floppy drives or CDs is
goods for the purpose of levy of sales tax and finally held that it is goods and attracts sales tax when transferred to a
buyer or user for a price. The Honourable Supreme Court further held that both branded and unbranded software are
goods because in both cases the software is capable of being abstracted, transmitted, transferred, delivered, stored,
possessed, consumed. The Honourable Supreme Court however did not express any opinion on unbranded software
only because of the necessity to examine other questions like situs of sale and / or whether the contract is service
contract etc.
       The Honourable Supreme Court prima facie held that both branded and unbranded software recorded on floppies
and CDs are goods. Three is no difficulty in levying tax on branded or canned software because it is sold for a price

                                                                                                                                 Circular Instructions of CCT
across the counter. In the cases of unrabranded software there will be usually written contracts elaborately specifying
the nature of software, its price, the time period within which it should be developed and delivered etc. There is a
thinking in certain quarters that development and installation of unbranded software is works contract. But, is must be
remembered that in a works contract it is by way of accretion/accession transfer of property in goods takes place. For
accretion/accession to take place there must be a nucleus belonging to the customer. Around the nucleus the contractor
builds by using his own materials. The transfer of property in the material used by the contractor takes place by way
of accretion/accession and is taxable as one of the mutated sales after 46th Constitutional amendment. A contract
without a nucleus belonging to the customer cannot be termed as a works contract. It is a case of chattel and is a sale
simpliciter taxable under the sales tax Acts. In the cases of unbranded software the customer generally does not
supply any nucleus. He only specifies his requirements and the software developer develops the software as per
those specifications either at his premises or at the customers premises, makes copies of the software on floppies or
CDs and delivers to the customer or installs on the computer of the customer. These transactions therefore are simple
sales. It is however necessary to examine the contracts meticulously to decide whether they confirm to the general
pattern of development and delivery of unbranded software described here above or are there any deviations and
assess the software developer accordingly.

                                                                                    19th February 2008   ||   FAPCCI Review   || 23
                                      With regard to the “Consultancy charges” referred to be the DC(CT) (Rural) Division, they are usually the
                               charges collected by the software developer from the customer from time to time at different stages of developing the
                               software. All these charges therefore form part of the sale price once the sale fructifies by delivery of the floppy or Cd
                               containing the required software. They are all pre-sale receipts and add to the sale value of the software. There may
                               however be post-sale receipts also in case they are received for maintaining the software after it is sold. Even in the
                               case of maintenance, the actual service rendered may involve development of a new software programme which
                               plugs the bugs that are discovered in the original software in the course of its usage. In such cases again the transactions
                               actually sale of software but ostensibly termed “consultancy” or “maintenance” etc. It may also be a case of simple
                               service without involving any development and delivery of software.
                                      All the assessing and revisional authorities in the State are therefore requested to examine the cases of
                               software companies in the light of the observations of the Honourable Supreme Court and with reference to the contract
                               agreements between the customers and the software companies to ascertain to true nature of the transactions, the
                               situs of sale etc and take appropriate action accordingly and report compliance.
                                                                                                                                   RANJEEV R. ACHARYA
                                                                                                                         Commissioner of Commercial Taxes


                               CCT’s Ref.No. AIII(2)/7/2007                                                                                 Dated : 04-07-2007

                                                           Smt. Ranjeev R. Acharya, I.A.S., Commissioner of Commercial Taxes


                               Sub      :- Clarification regarding I.T. Products, the Tariff codes of which are changed by Central Excise Department.
                               Ref      :- G.O.Ms.No. 1615 Rev.(CT-II) Dept. Dt. 31-08-2005.

                                         Under Entry 39 in Schedule IV appended to APVAT Act certain products are included as information technology
                               products. The applicable rate of tax for these products is 4%. The Government of A.P. Vide notification in G.O.Ms.No. 1615
                               Rev.(CT-II) Department dt. 31-8-2005 w.e.f. 1-9-2005 had issued HSN codes to the items under entry 39 of APVAT Act. The
                               Tariff codes given to the I.T. Products are described in this Notification with reference to their classification under the Central
                               Excise Tariff Act, 1985.
                               2.    The Ministry of Finance, Government of India have effected certain changes in Chapters 84 and 85 of the Central Excise
                                     Tariff with effect from the 1st January 2007. The purpose in effecting these changes is to align the Central Excise Tariff
                                     with certain commitments to the World Customs Organisation.
Circular Instructions of CCT

                               3.    As a result of these changes, the tariff heading applicable to several of the products notified as information technology
                                     products have changed.
                               4.    It is clarified that pending issue of a Notification, changing the HSN codes appropriately, all products that are falling
                                     under various tariff codes already notified vide reference cited, will continue to treated as information technology products
                                     for the purpose of the Entry 39 of IV Schedule to APVAT Act notwithstanding the changes in the Central Excise Tariff
                                     heading for these products. In essence, the description of the goods in the said entry prevail over the HSN Codes.
                               5.    This circular cannot be made use of for legal interpretation of provisions of law, as it is clarificatory in nature. It is
                                     reiterated that only those items for which the tariff code notified vide reference cited will continue to be liable to tax @
                               6.    The dealers in case of any doubt may contact the Tax office concerned.

                                                                                                                                      G. LAKSHMI PRASAD
                                                                                                                        for Commissioner of Commercial Taxes

            24 || FAPCCI Review || 19th February 2008
19th February 2008   ||   FAPCCI Review   || 25
                   COMPANY LAW & CAPITAL MARKET

                 MCA-21 E FILING,                                                  The MCA21 project is designed to fully automate all
                 Annual Returns and other Issues on 12.02.2008.                    processes related to the proactive enforcement and
                 The Federation of Andhra Pradesh Chambers of                      compliance of the legal requirements under the
                 Commerce and Industry (FAPCCI) organized a Seminar                Companies Act, 1956. This will help the business
                 on “MCA-21 e filing, Annual Returns and Other Issues”             community to meet their statutory obligations.
                 on 12th February, 2008 at 04:30 p.m. at Surana Udyog
                 Auditorium, Federation House, FAPCCI.                             A total of three topics covered in this seminar are

                 In his welcome speech, Sri V S Raju, Chairman, Company            1.   ‘Corporate Income Tax and e filing Management in
                 Law and IPR Committee, said Ministry of Company Affairs,               Income Tax’ by Sri D Premnath, CA,
                 Government of India, has initiated the MCA21 project,
                                                                                   2.   ‘MCA 21 ROC Annual Returns and Other Issues’ by
                 which will enable an easy and secure access to MCA
                 services in a manner that best suits the corporate entities            Sri Ritesh Mittal, Director, Ayrus Consultants Pvt Ltd.
                 and professionals besides the public. MCA21 is intended           3.   ‘Recent Changes in MCA 21 and Future Road Ahead’
                 to achieve all the objectives of a versatile e-Governance
                                                                                        by Sri Henry Richard, ROC, Govt. of Andhra
                 project. Rather than compelling the business community
                 to physically travel to MCA offices, MCA services will be              Pradesh.
                 made available at the place of their choice, be it their          The seminar ended with Vote of Thanks proposed by Sri
                 homes or offices. The major components involved in this
                                                                                   Abhay Kumar Jain, Co-Chairman, Company Law and IPR
                 comprehensive e-Governance project are Front Office and
                                                                                   Committee, FAPCCI.
                 Back Office.

                   FOREIGN TRADE
                 Half-day orientation programme on                                 in 2003-04 to Rs.31,845 crores in 2006-07 representing a
                 Export Marketing and Export planning on 12.02.08.                 cumulative growth rate of 117%. The state government
                                                                                   undertakes to facilitate rapid and sustained growth of exports
                 The Federation of Andhra Pradesh Chambers of Commerce
                                                                                   from the state and to increase the share of state in all India
                 and Industry with the support of ZDH/SEQUA Partnership
                                                                                   exports from the present level of 5% to 10%. Thus the
                 Programme-India organized a Half-day Orientation
                                                                                   governments at the centre and the state desire a substantial
                 Programme on “Export Marketing and Export Planning” on
                                                                                   increase in exports from the country and the State as well.
                 12th February, 2008 at Federation House.
                                                                                   This is possible through a host of measures that include
                 Welcoming the delegates Shri Suraj Prasad Agarwal, Sr. Vice-      creation and strengthening of export infrastructure,
                 President, FAPCCI stated that Exports are beneficial to the       strengthening traditional markets and diversification into new
                 country in many ways. Realising this, the current foreign trade   markets through knowledge initiatives. He further
                 policy envisages to increase India’s export to 2% of global       emphasized that the primary objective of the orientation
                 merchandise by 2009. By March 2008, an export target of           programme is to provide an effective orientation into
                 US$ 200 billion in fixed. Foreign exchange helps pay off          knowledge into of exports, tariffs, markets and strategies to
                 external loans and aid, enable vital and critical imports.        enter them with a view to enhancing the exports from the
FAPCCI at Work

                 Exports also promote economic activity by increasing              country.
                 employment potential particularly in semi-urban and rural         Shri Ramakrishna Rao Chitturi, Director, International Trade
                 areas.                                                            Facilitation Centre, FAPCCI gave detailed scope of the
                 He further informed that Major exports from Andhra Pradesh        programme. He explained the basic and fundamentals of
                 consist of software and electronic goods, ores and minerals,      India’s foreign trade, export marketing and planning. The
                 engineering goods, drugs, pharma and chemicals, agro and          Orientation programme was well attended.
                 processed foods, leather goods and marine products, and           Shri Shiv Kumar Rungta, Chairman, Foreign Trade committee,
                 textiles. Exports from the state grew from Rs.14,703 crores       FAPCCI, proposed a vote of thanks.

     26 || FAPCCI Review || 19th February 2008

05.02.2008 – Goal Setting at Noble Institute of               06.02.2008 – Goal Setting
Science and Technology, Lankelapalem.                         at Andhra University,
FAPCCI LADIES WING organised an individual                    College of Engineering, Waltair.
Development Course on “Goal Setting; at NIST,                 FAPCCI LADIES WING organised an individual
Lankelapalem by Sri V V Sanyasi Rao for their 200 MBA         Development Course on “Goal Setting; for B Tech students
students. Students participated with great interest and       of Andhra University Engineering College. Prof Allam Appa
attention. Sri Ananda Rao, Chairman and Correspondent         Rao, Principal of the Engineering College Inaugurated by
of the college presided the programme and highly              lighting the lamp and addressed the gathering. Prof A
appreciated the course. Director Prof Sreenivasulu Reddy      Avadhani, OSD introduced the faculty V V Sanyasi Rao.
by said that if students absorb the in formation and follow   Vice Principal proposed vote of thanks for the inaugural
the techniques shared in the course , they will achieve       session. All the students very actively participated in the
what ever they want to achieve and become successful          exercises, Case studies and the programme though the
people. The faculty was introduced by Smt Sailaja, in         programme was conducted at the fag end of the day. Some
charge HRD of the institute.3 students given their            Students gave their impressions and said they some of
impromptu remarks and expressed that they were                them felt that they are commoners and failures. . They
privileged to attend the programme. They said that after      have expressed thanks to the faculty for his guidance on
attending the programme they have started identifying their   how and why to avoid that feeling and how to feel like an
Goals, strong points & weak pointes. They have expressed      achiever and try to be achievers. Miss Priya proposed vote
that they will start utilisng the strong points and convert   of thanks. The news was published in many news papers
weak points as strong points to achieve their Goals.          like Deccan Chronicle etc.

06.02.2008 – Goal Setting                                     07.02.2008 – Goal Setting
at Centre for Management Studies Department of                at Dr Lankelapalli Bullayya P G College,
Andhra University, Waltair.                                   Visakhapatnam.
FAPCCI LADIES WING organised an individual                    FAPCCI LADIES WING organised an individual
Development Course on “Goal Setting; at CMSD, Andhra          Development Course on “Goal Setting; at Dr Lankelapalli
University, Waltair for their 150 MBA students. Students      Bullayya P G College, Visakhapatnam for their 120 MBA
participated with high level of participation, utmost         students. Students participated with high level of spirits
attention and interest. Prof D Prabhakara Rao, Head of        and very actively. Prof Patnaik introduced the faculty Sri
the Department of Commerce studies & Management of            V V Sanyasi Rao. All the participants have shown 100%
AU introduced the faculty V V Sanyasi Rao. Dr Prabhakar       attention and interest on the programme. Many students
who was their through out the course admired the              have shown their interest to share their strong points, weak
presentation, speaking ability of faculty Sri V V Sanyasi     points and their Goals while discussing the case studies.
Rao and also said the content is highly useful for the        All the students shown interest to have interaction with
human being set and achieve their Goals. He has               the faculty and collected the email ids Prof Patnaik highly
requested Sri Sanyasi Rao to conduct training                 appreciated and admired the presentation. Students who
programmes regularly for their students                       have shared their feeling on the programme expressed
                                                                                                                                FAPCCI at Work

4 Students gave their impressions. They felt that they are    that the day is a great day in their life as they were
fortunate enough in participating in the programme as they    introduced to the technology of Goal setting fulfilling their
were exposed to the techniques of Goal Setting &              ambitions and aspiration. As usual all participants taken
fulfillment.                                                  an oath that they would like to do any thing positively to
                                                              achieve their Goals.

                                                                                   19th February 2008   ||   FAPCCI Review   || 27
                                                          Meeting with the delegation of
                                                    National Chamber of Commerce of SriLanka
                                                                  on 15.02.2008
                    A delegation led by Sri D.Eassuwaren, President, National Chamber of Commerce of Sri Lanka met the
                    President Sri Atluri Subba Rao and Smt.M.Hemalata, Secretary, FAPCCI on 15th February, 2007
                    at Omprakash Tibrewala Board Room, Federation House and discussed at length on the joint meetings,
                    consultations on various problems pertaining to the promotion of trade, investment, social, economic,
                    technical and scientific cooperation and all other spheres of economic activities of both the Countries.
                    In this connection an MOU has been signed between FAPCCI and The National Chamber of Commerce
                    of SriLanka (NCCS). On behalf of FAPCCI Sri Atluri Subba Rao, President and Sri D.Eassuwaren,
                    President, NCCS signed the MOU.

                 Release the book on                                             ‘FAPCCI-HYPEX 2008’
                 “SEZs International Experience and Indian                       Philatelic & Numismatics Exhibition
                 Scenario” authored by Shri V.K. Srinivasan and                  on 16.02.2008
                 Shri P.S. Sundaram on 14.02.2008
                                                                                 A three day Philatelic and Numismatic Exhibition was
                 Defending the Government’s decision to promote special
                                                                                 inaugurated by Dr. A. Chakrapani, Chairman, A.P.
                 economic zones, Union Commerce Secretary G.K. Pillai
                 has asserted that the initiatives launched in the SEZ will      Legislative Council on 16 th February, 2008 at the
                 enable investments to the tune of Rs. 3 lakh core and           ‘Federation House’, FAPCCI.
                 employment to six lakh workers in the next couple of years.
                                                                                 Sri Atluri Subba Rao welcomed the Chief Guest, Dr. A.
                 Over 1.14 lakh jobs have been created and an investment         Chakrapani, Chairman, A.P. Legislative Council and Sri
                 of Rs. 67,000 crore flowed in the last two years since the      M. Venkateswarlu, Director, Postal Services, Hyderabad
                 Government initiated efforts to promote SEZs. Indirectly
                                                                                 City Region, and Sri M.G. Pittie, President, The
                 referring to the criticism over the allocation of vast tracts
                                                                                 Hyderabad Philatelic and Hobbies Society and other
                 of land to SEZs, he described India as a “noisy democracy”
                 and “we have to live with this noise” while promoting           dignitaries.
                 policies that were aimed at the larger public good.
                                                                                 Sri M. Venkateswarlu, Director, Postal Services has
                 Moreover, the rules framed for SEZs were so stringent           released a Special Cover to commemorate the occasion
                 that the land cannot be misused by the promoters, he said       and released the Souvenir brought out by The Hyderabad
                 challenging the critics to prove a single instance of misuse    Philatelic & Hobbies Society.
                 in all the notified SEZs.
                                                                                 Many entries have been received in the Philatelic division
                 Mr. Pillai was speaking at a meeting organised in
                 connection with the release of the book “SEZs –                 both in the competition class and in invitee class while
                 International Experience and Indian Scenario” co-authored       more than 50 Dealers from all over the country have
                 by veteran civil servant V.K. Srinivasan and senior             participated in the exhibition. The Exhibition will be kept
FAPCCI at Work

                 journalist P.S. Sundaram here on Thursday.Reserve Bank          open for three days from 16 to 18 February, 2008 from
                 of India former Governor M. Narasimham, who released            10:00 a.m. to 6:00 p.m.
                 the book, hoped that the “dispassionate work” that touched
                 various aspects of SEZs would help clear the air on some        Sri V. Anil Reddy, Chairman, Posts & Telecommunications
                 of the controversies. Chief Secretary J. Harinarayan said       Committee, FAPCCI proposed vote of thanks at the
                 that the Government was concerned that despite quick            conclusion of the inaugural session.
                 steps, it was not finding many units getting into production.

     28 || FAPCCI Review || 19th February 2008
               Felicitation to Prof. M.S.Swaminathan and Dr. M.V.Rao
                             21st February 2008 at 10.00 a.m. at Federation House.
Federation of AP Chambers of Commerce & Industry (FAPCCI) in association with AP Krishak Samaj, a Farmers’
Forum, is organising a programme to Felicitatate renowned Agri. Scientists Prof. M.S. Swaminathan, MP and
Dr. M.V.Rao, MLC on 21st February, 2008 at 10.00 A.M. at Surana Udyog Auditorium, Federation House.
Prof. M.S. Swaminathan is an Agricultural Scientist and is considered as father of “Green Revolution”. He is
responsible for making the country self sufficient in food grains. He is presently a member of Rajya Sabha
besides he is a Padma Vibhushan Awardee.
Dr. M.V. Rao, a famous Agricultural Scientist and rendered his valuable services in the field of Agriculture. He
served the country in various capacities. His services as VC of A.P. Agricultural University are memorable. In
recognition of his services he has been inducted as member of A.P. Legislative Council.
The above two Agricultural Scientists will be felicitated for their valuable services.
Sri D.A. Somayajulu, Deputy Chairman, Agricultural Technology Mission & Adviser to Govt., Economic Affairs
& Policy Implementation, Govt. of A.P. will be Chief Guest.
Sri Ajeya Kallam, IAS, Principal Secretary to Government, Agriculture & Cooperation Department, will preside
over the function.
All the interested officials / representativesand members of Farmer’s Associations / Delegates & others are
requested to attend the programme and utilise the opportunity. We also request you to kindly distribute these
circulars among others.
We request you to make it convenient to attend the programme.
For further details please contact Mrs. M. Bhuvaneswari, Asst. Secretary, FAPCCI (23393658/9246228436)

               Meeting with Officials of The British Midlands in India
                     Date: 22nd February, 2008; Time: 4.00 p.m.Venue: Federation House
We wish to inform you that Ms.Chandrika Shah, Country Representative of The British Midlands in India and
Mr.Michael Carr, Executive Director of Business Services at East Midlands Development Agency (EMDA), is
visiting Hyderabad on 22nd February, 2008.
FAPCCI is organising a Meeting with the Officials of The British Midlands in India on 22nd February,
2008 at 4.00 p.m. at J.S. Krishna Murty Hall, Federation House.
Ms.Chandrika Shah represents two Regional Economic Development Agencies(RDAs) namely East Midlands
Development Agency (EMDA) at Nottingham and Advantage West Midlands (AWM) at Birmingham.
Mr.Michael Carr is Executive Director of Business Services at East Midlands Development Agency (EMDA),
where he has responsibility for all aspects of EMDA’s support to businesses including Inward Investment,
Tourism and Innovation. Mr.Michael takes the lead at Executive Director level nationally, on behalf of all Regional
Development Agencies, for relationships with the Department of Business Enterprise and Regulatory (BERR)
regarding manufacturing industry and also with UK Trade & Investment. He is also member of BERR’s
                                                                                                                             For Your Diary

Manufacturing Strategy Board, Enterprise Strategy Group and Business Support Simplification Steering Group.
The purpose of Regional Economic Development Agencies (RDAs) is to encourage and assist Indian companies
which are at the threshold of globalizing their operation to Europe and UK and in particular, The British Midlands.
The region’s core strengths are in engineering, pharmaceuticals and IT related to High Performance engineering.
Members are requested to kindly make it convenient to attend the meeting and confirm their participation to the
Federation Office, to enable us to make necessary arrangements.

                                                                                19th February 2008   ||   FAPCCI Review   || 29
                                         Seminar on
                                                                                                      Seminar on
                               “ART OF PARENTING”                                   ‘Union Budget-2008 and Its Implications’
                 Ms. Lakshmi Shailaja from Oneness University                           On Monday 3rd March, 2008 at 5.00 p.m.
                                                                                     at KLN Prasad Auditorium, Federation House.
                 Date : 22-23 February, 2008                 Time : 5-00 p.m.
                           Venue : Surana Udyog Auditorium                        FAPCCI is organising a Seminar on Union Budget - 2008
                                     Federation House.                            and its Implications on 3rd March,2008 at 5.00 p.m.
                                                                                  at KLN Prasad Auditorium, Federation House, FAPCCI
                 We are happy to inform that FAPCCI in association with
                                                                                  (followed by dinner).
                 Oneness University is organising a seminar on “Art of
                 Parenting”.                                                      Presentation on ‘Union Budget-2008-Direct Taxes’
                 A Brief about Oneness University:                                by Shri K R Sekar, Partner, Deloittee Haskins and
                 Oneness is a system that is giving Form and Structure,           Sells, Bangalore.
                 Destiny and Direction to today’s world . It revolutionizes       Presentation on ‘Union Budget-2008-Indirect Taxes’
                 your current state of consciousness, thus enabling you           by Shri S Tirumalai, Partner, Deloittee Haskins and
                 to take control of your life and steer it in the direction you   Sells, Hyderabad.
                 want. Towards this end Oneness University has been
                 conducting programmes since 1989, and covered over               We are approaching the Chief Commissioner of
                 1.5 million people across 126 countries. They are                Income Tax and other officials from Income Tax
                 specialized in delivering Breakthroughs to individuals and       Deparltment with a request to preside over the
                 organizations in their Inter & Intra personal relationships      Seminar.
                 creating the right Physiology, phychology and philosophy         No Participation Fee.      Kindly confirm your
                 necessary for peak performance and cohesion within a             participation sent to Mr. Purnachandra Rao,
                 given system.                                                    Asst.Secretary, FAPCCI , E-mail:;
                 Members are requested to utilise this opportunity by             Mobile:09966008900
                 attending the programme.

                                  Interactive meeting on
                 “Hyderabad Traffic - Present Challenges
                         and future solutions”
                             Date: 13.3.2008; Time: 5.00 p.m.
                               Venue: Federation House.

                 We are happy to inform you that FAPCCI is
                 convening an interactive meeting on “Hyderabad
                 Traffic - Present Challenges and future solutions”
                 wherein the senior officials of Hyderabad Metrol Rail
                 Limited, HUDA, Greater Hyderabad Municipal
                 Corporation, APSRTC and Police are participating and
                 apprising the situation of traffic in Hyderabad and the
For Your Diary

                 activity of their Department, for the benefit of

                 Members are requested to make it convenient to
                 attend the programme and interact with the officials
                 and clear their doubts if any to Sri S.B. Jaiswal, Joint
                 Secretary, FAPCCI.

     30 || FAPCCI Review || 19th February 2008
                                                      Seminar on
                ‘Pollution Control & Environmental Management’
                             Date:27th February, 2008; Time:10:00 a.m. to 5:00 p.m.
                              Venue: Surana Udyog Auditorium, Federation House.

FAPCCI is organising a Seminar on ‘Pollution Control & Environmental Management’ on 27.2.2008 at Surana
Udyog Auditorium, Federation House. Senior Officials from A.P. Pollution Control Board (APPCB), EPTRI and
NEERI are invited to handle the sessions at the seminar and the following topics are being covered. Sri Rajeshwar
Tiwari, IAS, Member Secretary, APPCB will be the Chief Guest and inaugurate the seminar.

     Topics                                                                Speaker

1.   Role of APPCB to control Pollution in Industries                      Shri B. Madhusudana Rao,
                                                                           Sr. Environmental Engineer, APPCB

2.   Role and Responsibility of Environmental Consultants                  Sri J. Sridhar, Sr. Manager,
     Envrionmental                                                         Engineering & Management, EPTRI

3.   Environmental Audit                                                   Dr. B. Padmaja,
                                                                           RAMKY Testing & Consulting Services

4.   Environmental Standards - Implementation Roles                        Dr. Nalini Bhat, Advisor,
     and Responsibilities (Govt., Pollution Board and Industry)            Ministry of Environment & Forests,
                                                                           Govt. of India

5.   Risk Analysis and Disaster Management                                 Sri M.K.Reddy, Dy. Director,
     in Chemical Industries                                                NEERI at IICT, Hyderabad

6.   Compliance of Environment Regulations and
     Pollution Control requirements - Industry’s view point                From the Industry

The objective of the seminar is to highlight on the latest information about the statutory regulations and compliance
thereof by the industry. It is a full day seminar with a provision for Open House discussion to enable the participants to
clear their doubts and raise issues for clarification. A delegate fee of Rs. 500/- is fixed to meet a part of the seminar

Members are requested to take advantage of this opportunity and depute delegates for the seminar to learn about the
latest information about the pollution control requirements in the interests of maintaining the environmental safety. Kindly
                                                                                                                                   For Your Diary

confirm your participation and for further details, please contact Sri C.V. Rao, Dy. Secretary on 9391359934.

                                                                                      19th February 2008   ||   FAPCCI Review   || 31
                                                               National Seminar on
                                         “RAISING CAPITAL FOR INDIAN COMPANIES”
                                              19 TH March,2008 at Hotel Taj Krishna, Hyderabad.

                 We are happy to inform that FAPCCI CEO Club is organizing a One-day National Seminar on Raising Capital for Indian
                 Companies” on 19th March, 2008 at 10.00 am in Grand Ball Room, Hotel Taj Krishna, Hyderabad, mainly to discuss
                 the following issues

                 *     Indian Economy an Overview                  *        Listing a company on BSE/NSE
                 *     Financial Reporting Pre and Post IPO        *        Ensuring the Proper Legal Framework
                 *     Capital Raising using Private Equity        *        Capital Raising using QIP
                 *     Capital Raising GDR/ADR and                 *        Communicating with the Investment

                 Prof. Ram Mohan Rao, Dean, Indian School of Business, Hyderabad has kindly consented to be the Chief Guest at the

                 Eminent Speakers from JM Financial, UBS, IL & FS Investment Securities Ltd., Ambit, Kotak are expected to deliver the
                 lectures at the Forum.

                 Delegate Fee: Rs. 2000/- per participant. For FAPCCI CEO Club Members, Entry is free.

                 Interested Members may confirm their participation to FAPCCI Office either by fax (no. 23395083) or e-mail

                                                                Global Conference on
                               Good Governance: Communication and Media Strategies
                 The Federation of Andhra Pradesh Chambers of Commerce & Industry In association with Global Forum for Public
                 Relations will be organising a Global Conference on Good Governance: Communication and Media Strategies on
                 8th & 9th March, 2008 at 9.00 a.m. a KLN Prasad Auditorium, Federation House.

                 His Excellency Sri N.D. Tiwari, Hon’ble Governor of Andhra Pradesh will be inaugurate the Conference.

                 Conference Tracks
                 Keynote on the conference theme Good Governance: Communication and media strategies;
                 Globalization and good governance:Challenges and opportunities for corporate India;
                 Changing National & Global media:New Strategy for Global Public Relations;
For Your Diary

                 Corporate social responsibility : A road map for reputation management;
                 Corporate Ethics &Spirituality :Meaningful relations with Stakeholders.
                 India as a Global player : A paradigm shift incorporate communication perspective.

                 Delegate Registration: Delegate registration will be accepted by post or fax. Detailed registration form is appended.
                 Also available on the website of GFPR - The Tariff details are given at page 32:

      32 || FAPCCI Review || 19th February 2008
                                                              TARIFF PLAN

   Registration Fee

    Category                                                                           Registration fee                     Last date
   Govt./Corporate/Pvt Sector/Industry delegates etc.                                      Rs. 2000-00                      22-2-2008
   Delegates from FAPCCI/ABCI/PRSI/PRCI/HMA etc.                                           Rs. 600-00                        - do-
   Students of PR, Comm., Mngmnt & Pub. Admn etc.                                          Rs. 300-00                        - do-
   The registration fee includes conference kit, lunch, dinner, tea & coffee. Payment should be made only through demand
   draft drawn in favour of “FAPCCI, Hyderabad” payable at Hyderabad.
   Completed registration form along with registration fee may be sent to :

  Particulars                                                                     Amount (Rs.)
  Lead Sponsorship                                                               1,00,000-00
  Delegate Kit                                                                   5,00,000-00
  Dinner / Lunch & Refreshments                                                    50,000-00
  Banners                                                                          10,000-00
  (Corporate souvenirs / gift items are also welcome)
   Advertisement Support

   Description                                                                     Type                          Amount
   1. Back Cover Page (Outside)                                                    Color                         25,000-00
   2. Cover Page Front and Back (inside)                                           Color                         20,000-00
   3. Full Page                                                                    Color                         14,000-00
   4. Full Page                                                                    B&W                             7,000-00
   5. Half Page                                                                    Color                           7,000-00
   6. Half Page                                                                    B&W                             3,000-00

 Delegate Registration forms, Sponsorship and Advertisement support may be sent to Sri Y. Bhaskara Rao, Deputy Secretary,
 FAPCCI, Federation House, Red Hills, Hyderabad, India - 500 004. Fax: +91-40-23395083, Phone: +91-40-23393428,
 Mobile: 9393029162, E-mail: &

                                                                                                                                               For Your Diary

                                    SOLAR POWER GENERATION PROJECTS
The Ministry of New and Renewable Energy (MNRE) has announced          Full details can be downloaded from the website :
a new Scheme for installation of Megawatt Capacity Grid Interactive    pdf/guidelines_spg.pdf
Solar Power Plants. As per the guidelines, the Ministry will support   For further clarification please contact : Dr. T.C. Tripathi, Adviser
for a maximum capacity up to 50 MW during the 11th plan period         (Solar), Ministry of New and Renewable Energy (MNRE) Telfax No.
and the Indian Renewable Energy Development Agency (IREDA)             011-24361932, E-mail: or Dr. B. Bhargava, Director
will assist the Ministry in fund handling, monitoring and other        (SPV), Ministry of New and Renewable Energy (MNRE), Telefax
associated activities.                                                 No. 011-23461891, E-mail:

                                                                                               19th February 2008      ||   FAPCCI Review   || 33
News Clippings

      34 || FAPCCI Review || 19th February 2008

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