QBiz: SEBI, IT to Probe Paradise Papers; Aircel May Shut Ops

The Quint brings you the top business stories of the day.

Aircel’s 2G license might get cancelled. (Photo Courtesy: Wikimedia Commons)

1. Sebi, Income Tax Dept to Probe Indians Named in Paradise Papers

The income-tax department and the capital markets regulator on Monday said they will be scrutinizing the so-called Paradise Papers—documents obtained by a global network of investigative journalists—to see if any Indian individual or companies were guilty of wrongdoing.

While the income-tax authorities will investigate companies allegedly evading taxes by using complex offshore structures, the market regulator will be scrutinizing disclosures.

Accordingly, the Central Board of Direct Taxes (CBDT) has asked its investigation wing to reopen the income-tax returns filed by the companies and individuals named in the leaks to see if any of their past incomes have gone un-taxed, said CBDT chairman Sushil Chandra.

(Source: Livemint)

2. Time for Politicking Over, Let's Rebuild the Economy: Manmohan Singh to Modi

The impact of demonetisation “on the weaker sections of our society and business is far more damaging than any economic indicator can reveal,” said former Prime Minister of India Manmohan Singh in an interview on the first anniversary of the Narendra Modi government’s move to declare all five-hundred and thousand rupee currency notes invalid.

In a rare interview to Praveen Chakravarty, contributing editor at BloombergQuint, Singh expressed concern regarding the loss of jobs in the small and medium enterprises sector and also emphasised the exacerbating impact that may have on inequality.

...rising inequality has been a constant threat to our nature of economic development. Demonetisation may exacerbate such inequalities which can be harder to rectify in the future. In such a diverse country such as ours, inequality can prove to be a far greater social malaise than in other homogeneous nations.

Manmohan Singh, Former Prime Minister

(Source: BloombergQuint)

3. Aircel May Have to Wind up Operations Post Failed Reliance Communications Deal

Aircel may be left with no choice but to slowly wind up operations after the scrapping of its merger with Reliance Communications, with a court diktat preventing the telco from selling its 2G or 3G spectrum while it continues to lose money amid a fund crunch and high debt, said experts.

ET spoke to multiple analysts who said the operator, with a gross debt of some Rs 20,000 crore and having no 4G spectrum, may try to structure a deal that could exclude the spectrum it owns.

It could hand off its other wireless assets, including nearly 89 million subscribers, to a larger telecom player and its 40,000 towers to another entity, they said.

(Source: Economic Times)

4. Paytm Integrates BHIM UPI on Its Platform in Bid to Double User Base

Digital payments firm Paytm has integrated BHIM UPI, the government’s mobile payments interface, onto its platform as it looks to double its monthly user base over the next two years. Paytm, run by One97 Communications Ltd, currently gets about 100 million monthly users on its platform. Introducing payments via BHIM UPI will help Paytm broaden its customer base and help expand the usability of the instrument.

“We are now targeting 200 million monthly users in less than two years. UPI will also allow larger ticket size transactions,” said Vijay Shekhar Sharma, founder One97 Communications.

BHIM or Bharat Interface for Money is an application developed by the National Payments Corp. of India (NPCI) for digital payments over the government-managed Universal Payments Interface (UPI) network.

(Source: Livemint)

5. Revenue Secretary Hasmukh Adhia Named Finance Secretary

The appointments committee of the cabinet on Monday named revenue secretary Hasmukh Adhia as the new finance secretary, said an official order. By convention, the senior most secretary in the finance ministry is designated as the finance secretary.

As the functional head of the revenue department, Adhia has been overseeing rollout of the goods and services tax (GST) as well as direct tax reforms. The revenue department has been implementing a series of structural reforms in tax administration aimed at widening the tax net and integrating the cash-driven informal part of the economy into the formal one.

Prior to his appointment as the revenue secretary, Adhia served as secretary in the department of financial services in the finance ministry. The finance secretary’s post fell vacant on the superannuation of Ashok Lavasa last month.

(Source: Livemint)

6. HDFC Standard Life IPO to Open Today

HDFC Standard Life Insurance Company, a subsidiary of country’s largest mortgage lender HDFC, is looking to raise Rs 8,695 crore through an initial public offering that opens today. This will be the biggest IPO in the life insurance sector.

In the three-day offer, the company will issue up to 29.9 crore equity shares at a price band of Rs 275-290 apiece. At the upper end, it will command a valuation of Rs 58,076 crore, according to BloombergQuint’s calculations.

Morgan Stanley, HDFC Bank, Credit Suisse, CITIC CLSA Securities and Nomura Financial Advisory and Securities are managing the issue among others.

HDFC Life is a joint venture between HDFC and Standard Life Aberdeen plc.

(Source: BloombergQuint)

7. Sebi Plans Further Rise in Public Float

The Securities and Exchange Board of India is mulling another increase in minimum public shareholding (MPS) requirements from the current 25 percent to 30 percent, or even 35 percent, said three people in the know.

The discussions at the market regulator’s end are, however, at a nascent stage, clarified one of them.  India has traditionally been a promoter-driven market and increasing the threshold will ensure wider ownership through institutional investors, more market depth and better corporate governance standards.

(Source: Business Standard)

8. Congress to Seek Overhaul of GST at Next Council Meet

The state finance ministers of Congress-run governments said on Monday they would demand an overhaul of the goods and services tax (GST) at the next Council meet in Guwahati on Friday.

These ministers will make specific suggestions to the Narendra Modi government to provide succour to the MSME (micro, small and medium enterprises) sector, and give tax exemptions to those working in such industries, including jewellery, leather, textiles and bicycle.

The FMs said they have been flagging the problems in the GST regime for several months, but it is only now with criticism on the ground and the Gujarat Assembly elections around the corner that the Centre had started to pay heed to these suggestions.

(Source: Business Standard)

9. Big Retailers Starts Poaching Top Talent as Sector Returns to Growth Path

Big retailers have started poaching top talent from one another as the sector seems to have returned to the growth path on receding impact of demonetisation and launch of goods and services tax regime.

Jacob John, deputy CEO of Lifestyle departmental stores, has put in his papers to join inner wear maker Dixcy Scott as CEO, triggering a role rejig in Dubai-based Landmark Group that owns Lifestyle, two executives familiar with the development said.

Group veteran Vasanth Kumar, who currently heads the apparel value retail format Max Fashion, is likely to head Lifestyle, while Shital Mehta, who quit Pantaloon Fashion Retail as its CEO in September, is tipped to join Landmark Group as chief executive of Max Fashion from January, the two executives told ET. When contacted, Mehta said he is currently on a sabbatical.

(Source: Economic Times)