Today’s Latest Business News Transcript at 10:00 AM on 29 December 2023

Let’s begin. The new Telecom Act does not, in any manner give either the government or the service providers, the power to break encryption of messages exchanged via over-the-top platforms or intercept them, communications and IT minister Ashwini Vaishnaw told Fe in a wide-ranging interview. While highlighting how the Act will usher in an era of structural reforms, Vaishnaw dismissed criticism by some analysts that the definition of telecom service has been left vague, which gives the government the power to regulate OTTs at any future date by way of interception and break encryption. He said that the government does not have the power to ask service providers to break encryption or intercept as it is not part of the terms and conditions of the authorisation.

On to industry. Tata Consumer Products has said the appointed date of the merger of Tata Coffee with the company would be January 1, 2024. The announcement comes almost two years after Tata Consumer had first announced the merger of all businesses of Tata Coffee with itself. This was part of a reorganisation plan in line with the company’s strategic priority of unlocking synergies and efficiencies. The Kolkata bench of the National Company Law Tribunal had approved the merger of TCL with TCPL and a wholly-owned subsidiary called TCPL Beverages & Foods last month. While the plantation business of TCL would be demerged into TBFL, the remaining business of TCL, consisting of its extraction and branded coffee business, would be merged with TCPL, the company said.

Meanwhile, The Goods and Services Tax authorities have sent show cause notices to several listed companies, including Zomato, Bata India, ICICI Bank and Kotak Mahindra Bank in the past few days for non-payment of taxes, according to the separate statements issued by the companies. On Wednesday, Zomato told the exchanges that The Directorate General of GST Intelligence sent a show cause to the company asking why an alleged tax liability of Rs 401 crore along with interest and penalty for the period October 29, 2019 to March 31, 2022 should not be demanded from them. The amount alleged is based on the amounts collected by Zomato as delivery charges from the customers on behalf of the delivery partners during the referred period.

Moving on. Systemic risk identification and monitoring among non-banking financial companies is a challenge considering the significant heterogeneity within the segment, the RBI said in its latest Financial Stability Report. NBFC-investment and credit companies, and NBFC infrastructure finance companies account for 95% of NBFC segment’s advances. RBI notes that the balance sheets of these two categories of NBFCs present different risk profiles. While NBFC-ICCs focus on retail lending, NBFC-IFCs largely lend to the industrial sector. Between September 2021 and September 2023, retail lending by NBFCs grew at a compound annual growth rate of 25.2%, higher than the 15.7% rise in gross credit. As the end of September 2023, NBFC-ICCs’ share was 90.1% of total retail credit.

In other news, the RBI remains alert and committed to act early and decisively to prevent any build-up of risks, said governor Shaktikanta Das. In his foreword to the 28th issue of the Financial Stability Report, the governor said that the health of the Indian financial system is steadily improving on the back of multi-year high earnings, low level of stressed assets, and strong capital and liquidity buffers with financial institutions. Das said, quote, “Our recent macroprudential measures to curb lenders’ exuberance towards certain segments of retail loans underline our commitment to preserve financial stability without compromising availability of funds for productive requirements of the economy,” unquote.

Over to money matters. The Central Board of Direct Taxes has clarified that any payment made by the buyer or seller in a transaction facilitated by the e-commerce operator, shall be included in the gross amount of sales of goods or services for the purpose of 1% Tax Deduction at Source. In Budget FY20, the TDS provision was brought in, making it mandatory for e-commerce operator (buyer) to deduct tax on payments made to the e-commerce seller on gross sales exceeding Rs 5,00,000 in a financial year. The relevant Section 194-O came into effect on October 1, 2020. In a notification issued on Thursday, the CBDT clarified how the TDS will apply in a multiple ECO framework, such as the ONDC.

Lastly, let’s know which are the stocks in focus today. These stocks include Britannia Industries, Aarti Industries, and Nalco among others. National Aluminium Company is riding high at its 52-week peak, maintaining a bullish trend since the low in September 2022, indicating positive momentum. After nearly 14 months within a rising channel, the stock broke out last week with a surge in volume. Britannia is currently trading at its all-time highs, reflecting a robust upward trend with consistent higher highs and higher lows.

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