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Letters to the EditorLetters to the EditorLetters to the EditorLetters to the EditorLetters to the Editor
The Editor,
Keemat, CGSI.
Thank your for publishing the New Airline Rules laid down by the DGCA in Jan-Feb 09 issue. Thank god
for them, I was a victim of lost ticket till I got it redressed by the Consumer Redressal Forum. While on the Indian
aviation or be more precise Mumbai, I suggest CGSI takes up the matter of the confusion of two airports at
Mumbai. The Central Railway terminals all named after Chattrapati Shivaji. This confuses all traveleers, more
foreign and outsiders to Mumbai. It can cause delays and missing of journey and also cheating by unscrupulous
cabbies. It sure is a problem of consumers at large be taken up by CGSI Suo motu. Many, many will thank you.
The second is a report of Supreme Court judgement on mediclaim premium for senior citizens wherin it has
directed that insurance companies must desist from the practice of demanding hefty increases in the medical
insurance premium of senior citizens and also directed the IRDA to prescribe clear guidelines to all insurance
companies. I would like to CGSIs take up this matter, as a member of CGSI.
Nagesh Kini, ICA
Mahim House, Mogul Lane, Mumbai 400 016.
Dear Editor,
I had come with a complaint against the Barclays Bank in January'09 and the wrongly levied fines and
charges on the credit card we held with them. I write with immense relief and gratitude that the charges have been
reversed by them and I have received a letter from them to that effect.
When the problem had come, I was very harrassed and didnt know what to do as they were not replying to
any of our queries and simply levying the fines. The phone calls we were receiving from them were the final
straw. I happened to surf the net and saw the website of the Consumer Guidance Society of India and thought that
maybe approaching the society would atleast show me a way to tackle the problem. I was guided to your Karghar
office wherein I met you and Mr. Santosh Shukla. It was a relief to know that I was not alone in my fight. I went
back assured, hopeful of a solution.
Today, I stand vindicated in my fight against the Bank - all thanks to the Consumer Guidance Society! Your
support has ensured a speedy solution to something that I was battling alone for many months. I am going to
ensure that everyone I know as a friend or otherwise comes to know about this society that fights for their rights.
Thanks once again!
Regards
A.Prabhavati
Hi
The purpose of this letter is to make common consumers aware about the law relating to maximum retail
price (MRP) on packaged goods. I had put in a RTI (Right to Information) application to Controller of LegalMetrology, Maharashtra State and requested for the information relating to various laws regarding MRP violation
cases we face in day to days life.
You may want to publish this through your contacts in press and make common citizens award about the same.
1. It has been observed by many of us that many small shops in our locality always charge more money
for essential things like milk, mineral water than the printed MRP. If you try to argue with them, then they
say that extra one rupee or so is for cooling charges for milk or water as the case may be.
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Friends, this is fraud and a big offence under the weights and measures law. Charging more than MRP on
item like packaged drinking water is an offence under rule 23 (2) of the standards of weights and measures
(Packaged Commodities) Rules-1977. The maximum punishment for the same is fine which may extend to
Rs 2000 per responsible person.
So next time your local kirana shop guy asks you one rupee more for a milk bag than printed MRP, Tell him
that in the greed of earning that one rupee extra, he may face punishment of Rs 2000!!!
2. Also one more problem consumers face is in multiplexes,malls and at places like airports. Typicallyyou will find shops in these places selling items like soft drinks, water, biscuits etc at huge premium than
printed MRP. Some smart shops paste new MRP sticker on printed price to show that they are selling at MRP
only.
This is again an offence. A manufacturer can print different MRP for certain stock to be sold through select
channels like airports and if you observe closely, such items are printed with MRP more than normal but with a
clear message that for retail through select channels only.
To make my point clear,for example: Parle Agro as manufacturer of Bisleri can produce two different
batches of mineral water bottles: A and B
Batch A has say 1000 bottles with printed MRP Rs 15 and are sent to local shops/retail stores
Batch B has say 1000 bottles with printed MRP of Rs 40 and a message for retail through select channels only
Now on airport/multiplex, it is perfectly legal to sell a bottle from above batch B at Rs 40 as the taxes have
been paid to government on that Rs 40.However the same shop can not sell a bottle from Batch A at Rs 40. He has
to sell specific bottles MADE FOR THAT CHANNEL.
So friends, please be alert consumer and do not pay more than MRP.In case you find anyone charging more
that MRP, please call immediately office of the controller of legal metrology in Maharashtra on 022-22886666.
Your complaint will be taken down and you will receive a complaint number for further reference.It works and I
have been doing that till date. I always get a complete follow up from that office and actions have been taken on
shop owners.
Thanks and RegardsChinmay D. Gavankar
Mumbai-400020.
Seminar conducted on Consumer Rights at Rotary Club Sunrise
Dear Sirs,
Greetings from Rotary club of Navi Mumbai Sunrise.
I am happy to inform you that our club had conducted a guest lecture by Mr.Santhosh Shukla from Consumer
Guidance Society of India, Vashi, Navi Mumbai.The topic of the lecture was Awareness on consumer rights
This was very well received by our members, so much so that a programme though originally scheduled for
about 30 minutes lasted for more than 1 hour and 15 minutes. Though the topic itself is quite an interesting one
Mr.Shukla handled the same so well generating lot of interest and interaction from the members. There were so
many questions and finally we had to stop allowing questions due to paucity of time. On the whole, it was a very
good programme and we may consider working together to have seminars on this topic for improving the awareness
among the Kharghar residents / housing societies etc.,
Thanks & Regards,
Surya
S.Suryanarayanan
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As part of the World Consumer Rights Day
(15/03/09) celebrations, CGSI, in collaboration with
Values and Perception Improvement Colloquium held
a well-attended seminar on
consumer awareness was
held at the R D National
College conference hall on
14th March.
Topics covered
included energy
conservation, travails of the
telecom industry,
investments in these days
of economic meltdown,
Food - how to be safe, and
Silk - how not be cheated
by spurious silks.
The speakers
included, Ms. Dipti Padwal, who gave tips on
conservation of energy, Mr. A N Shanbhag who spoke
on how to invest in these troubled times Mr and Mr.
Sanjay Fernandes who enlightened the audience on how
to deal with problems faced by mobile subscribers.
Next, Mr. Shailesh Ghodekar explained how one can
prevent bacterial infections which cause many diseases
and Mr. R B Tandav informed one about
how to recognise genuine silk from mixed
yarns.
In his welcome address, Prof
Rajadhyaksha the Chairman of the CGSI,
said that many industries and agencies have
today come under the purview of the
Consumer Protection law. But, he said, the
consumer must also be responsible and not
be lax just because he can get redressespecially in areas which will prove
detrimental to the nation and the world e.g.
misuse of electricity by wasting it.
Responsibility always should go hand in
hand with rights.
Next Mr. Bapu Nadkarni, the
famous cricketer of yester years, addressed the
gathering. Dr. M.S. Kamath, while introducing him, told
Seminar on World Consumer Rights Day Jamna Varadhachary
the audience how Mr. Nadkarni holds the record for
the best bowling figures, ever. But it has not been ratified
nor has he been given Man of the Match or any such
award. Mr. Nadkarni helps many NGOs
and donated a computer when Dr.
Kamath happened to mention that CGSI
needed one.
Mr. Nadkarni said CGSI was an
NGO set up against all odds. They, by
sheer perseverance, got Consumer
Protection made into a law.. all this by a
band of committed ladies. He said
everyone must know their rights and also
know how to get it. CGSI is doing
yeoman service in the area.
ENERGY: Why we need to
conserve it
Next up.. Dipti Padwal from Reliance energy
spoke next about why we should conserve energy. The
subject is a vexing one. With massive shortages in our
country leading to load shedding for 10 hours at some
places. Power generation emits 24% green house gases
in the atmosphere which leads to global warming.
Global warming as
everyone knows causes,
melting of the ice in Polar
Regions which will make the
seas higher. This can inundate
the coastal areas. Mumbai
being one such city, there is a
real danger of that happening
in the near future.
Mumbai has 400 MW
shortfalls in power,Maharashtra 14000 MW and
in the entire country; it is in the
magnitude of 400000 MWs
shortfall.
To build a power plant
it takes 5 years, another 2
years to bring it on stream.
Society NewsSociety NewsSociety NewsSociety NewsSociety News
Mr. A.N. Shanbhag speaks on how to invest
in the current scenario
Mr. Bapu Nadkarni inaugurating
the Seminar
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The best way to ensure that we manage without
too much load shedding is by conserving. It is a paradox
that the very people who are selling power are askingus to conserve, even though they lose on the revenue.
But it is for the good of the consumers. Not only your
bills will be less, but you will also contribute to
everyones well being. She shared some tips and also
handed out a small booklet with all these helpful hints.
Some are listed below:
Switch off lights and fans when not in the room
Switch off all appliances at the plug specially
when using a remote to switch on a. TV, ACs
music systems. When it is over switch it off at the
plug. .Remotes, because they are on standby,
do consume power.
Microwave Oven, Mixers, Switch on only when
actually using it.
Washing machine should only be run on a full
load. A half load uses the same power.
Refrigerator. Buy only those with maximum
stars The more the stars, the less the power
used. Change the temperature setting according
to the weather. Give enough space all round for
air circulation. This helps it work more efficiently.
The main compartment should have space
between containers for air to circulate. But the
freezer can be packed tightly.
Do not keep the refrigerator door open when
deciding what to take out.
Cool food to room temperature before putting it
in the refrigerator.
Lights: Use CFL as it saves 70% electricity. It is
costlier to buy, but lasts much longer and brings
down the consumption saving you energy bills.
It is win win situation.
Use of electronic chokes also saves consumption Use of natural light instead of drawing curtains
and putting on lights.
Use table lamps for reading work; it will direct
the light to your work area.
Peak demand for power is between 10 am and 8
pm. Try and put on your geyser, washing machine
etc before or after that time.
A storage geyser is better as it heats up and keeps
is hot for some time.
Ironing: iron things needing hottest setting first
and later, when lighter clothes are to be done,
you can even switch off the iron and use the
remaining heat. Never iron just one garment, as
that is wastage of power.
Never keep AC setting lower than 24 C.
Computers; Lap top uses the least power. and
monitor of a desk top most. Switch off the
monitor when not working on it. Dont leave it
on screen savers.
Solar panels are now available for 25000/- theselast for 25 years with practically no maintenance.
Perhaps one can thing of those options.
All common sense tips, but she said we need to
put it into practice. This will bring the energy bill down
and be beneficial to the country.
Later on, Mr. A N Shanbhag a well known
writer on Investments spoke on Investments in todays
market. He said one can distribute the wealth to spouse,
children and relatives. This prevents taxation in the
donors hands. He said we think India has the lowesttax. At one time it was 94% on the highest slab. Now it
is much less just 33%.But we do not realise that the
indirect taxes levied like VAT, service tax, education
cess, security transaction tax, constitute a large chunk
of taxes we pay.
He emphasized that good investments would be
Equity based Mutual funds. This has the following
advantages:
Chairman Prof. N.M Rajadhyaksha and
Senior Committee Member B.V. Desai in a lighter moment
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Dividend is tax-free
Long-term capital gains are exempt from taxes.
Short-term capital gains only taxed at 15%
Deduction u/s 80C (ELSS)
But todays\ equity market is volatile
and care must be taken in investing.
Inflation is a major problem. When
calculating for your retirement at age, 30
say, you need Rs X- per month. You invest
for your retirement after 30 years and would
like to have the same standard of living.
Interest rate is average 7%
But with inflation running wild it
stands to reason that your capital base will
be have to be substantially higher to yield
the same amount. After 30 years. It is avexing matter.
A rule of the thumb while investing
would be. Invest a major percentage in
schemes like NSC, Post Office. PPF which
will yield only 8%. This is a safe bet.
Equity may yield higher returns but is
volatile and you may lose a lot of money.
At the end of period, even if the investments in
the equity market drops, your other investments will
be safe.
LIC is another good investment especially when
young. Not only it givers you life cover also gives bonus
depending on the plan opted for.
Some Mutual funds which give fair returns
1 year 3 year
Birla sunlife 13.71% 11.63%
ICI prudential income 16.59% 11.4 %
Relaince 13.94% 10.45%
But the most important point when you invest is:do so after studying the market as well as each
proposals brochure, reading the small print carefully.
Telecom Travails
Mr. Sanjay Fernandes of Tata Telecom tackled
the subject of mobile phones and it myriad complaints.
He started with telling how in 1998 when mobile had
just entered the market there were some 18 million
subscribers It grew to 300 million plus subscribers by
2008. This was both in the cities as well the rural
populace. This has prepaid 85% and only 15% postpaid
subscribers.
India has the lowest tariff and the highest quantum
of talk time.
He gave reasons for someproblems which the customer faces.
Call drops The TRAI allows a 3%
call drops. But obviously this is not
acceptable to the customer.
A main problem is they do not
have enough spectrum to
accommodate the rapidly increasing
customer base. This is something
only the government can rectify They
are not doing it quickly enough.
Call drops may be caused due
to being in places like basement, lifts,
building with thick stone walls
Remedy go outside and talk. If a hill
comes between the tower and where
you are, may be because a tower may
not be nearby. There are no instant solutions to these
problems.
A large number of prepaid card holders do not
submit their residence details to enable the service
provider to set up towers as required in each area.Without which the service provider cannot decide where
towers are needed.
Unsolicited calls. This happens because we give
our visiting card to everyone we meet. This number is
then passed on the people interested in building a data
base and they pay for these numbers. Data base builders
are smart and get addresses/ telephone numbers from
many sources, on payment.
Do not give your visiting cards to all and sundry
to prevent this. Also complain to your service providerand ask them to put Do Not Disturb (DND) on the
numbers.
If it still comes, complain again. First call the call
centre. If no response, call the Nodal person. If that
does not work go to the appellate. But do complain.
Wrong billing: this may be because the subscriber
does not fully understand the plan opted for. Most
Ms. Dipti Padwal elaborates on
how to save energy
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subscribers have no clue
what the actual charges are
for a local call / minute, STD
or ISD. Please read the offer
carefully before opting for
a plan. This happens mostly
in postpaid.
Response from
customer care. This is
caused by heavy traffic.
Also because the turnover
of the operators in call
centres is very high. As a
result one gets raw hands
that are not trained
adequately. As soon as they get trained they leave for
greener pastures.He said the industry is trying to
improve and it will improve. So we need to bear with
the them.
Food safety
Dr. Shailesh Ghodekar enlightened the audience
on safe eating practices.
He said that many ailments have their roots in
contaminated food. The doctor can give only palliative
treatment. The way to go is make some habits ingrained
so the problem can be eradicated.
Bacteria grows in food which we ingest causing
all problems. It grows in raw vegetables and fruits, stalefood, raw meat if not stored properly. Bad water,
moulds, pesticides, and pests like rodents, cockroaches
and flies also cause these bacteria to multiply. Even
things like hair, bidi, and cigarette butts are culprits.
Bacteria grow in the temperatures of 5 to 60 C.
They do not grow when there is no oxygen, like in
canned food. The trick is to store food in the correct
temperatures. Meat, egg etc below 5 C. Never leave the
meats outside put it away immediately.
Vegetables and fruits need to be washedthoroughly under running water to get rid of pesticide
residue.When eating outside, check for hygienic
surroundings before eating at dhabas. Eat only hot food
and hot tea because bacterias get killed with heat.
Wash hands thoroughly with soap before and after
touching food items especially when handling meat to
prevent cross contamination. Eggs : Never eat raw eggs
in any form. It might contain salmonella. Eggs must be
cooked well, do not leave the
yolk lightly cooked and runny.
When buying foodstuff,
look for Agmark, ISI or FTO
marks and also check the date on
the pack. Never buy dented,
bulging can or leakingcontainers.
When marinating meats,
leave it in the refrigerator, not
outside. If in doubt throw the food
away. Try and buy food freshly
daily. If that is not an option put
it away in the refrigerator or a
cool place, immediately.
Always ensure cleanliness in the kitchen, Have
clean vessels, plates. Wash hands before eating. Store
food at the correct temperatures. Following these basic
steps, one can prevent a lot of contamination of food
which leads to illness.
How to detect fake silk
Mr. R B Tandav of the Silk Mark Organization
addressed the gathering. He explained how the
Government has set up A SILK Mark Board. This
organization gives its stamp of genuine of the silk. The
dealer or manufacturer of silk applies to the Silk Board.
They test the material and then stamp it with their seal.
The seal is a hologram given to the silk manufacturer.One should look for this hologram before buying the
silk.
If there is hologram, it means it is genuine silk.
And you will not get cheated with a cheaper yarn mixed
with silk.
If you feel, the silk is not genuine; you can
approach the authorized centre and ask them to test it.
If it is a mixed material, you are entitled to a full refund
of the amount paid, on production of a bill.
They circulated a brochure giving a list of shops
who are members of the Silk Mark their offices in the
country. It also contains tips on how to wash silk. He
said it is better to check and look for the hologram rather
than being cheated of good silk, which is what you are
paying for.
Both the moderators Dr. M. S. Kamath and Prof
N. Israni did an excellent job. The session ended with a
vote of thanks.
At the interactive session (from L to R): Mr. R.B. Tandav,
Dr. Shailesh Ghodekar and Mr. Sanjay Fernandes
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Over the last two months, the CGSI has organized
seminars on investment awareness in collaboration with
SEBI and MET Colleges. This was arranged on four
Saturdays at the MET College premises. The model was
named after Kuber, the God of wealth. Its purpose: to
teach the audience how to create wealth.
The course content was decided at meetings ofSEBI personnel, MET faculty, Dr. M. S. Kamath and
Mr. Palav of CGSI. Among those who addressed the
gathering on the various days were Prof Vijay Page,
Dean of MET, Mr Rajendra and Kranti Purlkar of SEBI,
Sriram Siva Krishna, VP Stanchart Bank, Priyadarshi
Srivastava of IDBI, Prof Amdekar and Prof Godbole of MET.
Mr R P Vyas, Mr S Palav and Dr M S Kamath
compered the seminars, flagged off by SEBI Executive
Director, Mr. RadhakrishnanNair on March 28. Nair
gave a brief account of why SEBI was created - it was
initiated to protect the unwary investor, developinvestments and act as a regulatory authority to ensure
transparent dealings.
Among the audience were many young students,
who will soon be earning and investing their hard earned
money. Prof Page said that for every thing in this world,
training is needed. You do not ride a bike without
learning how to. You go to school and learn your three
Investment Awareness and Protection Programme - Kuber Model
Jamna Vardhachary
Rs and later go to college and learn more. Then why is
it that one just rushes headlong into investment. No
teaching, no idea of the pitfalls that awaits one. This
programme was designed to give basic dos and dontswhen embarking on investing.
He emphasized that the efforts of CGSI should
bear fruit in teaching the public how to invest, what
pitfalls to avoid and above all, try and ensure stringent
action against those who take the investor for a ride.
Mr S D Puri, a senior advocate, chaired one of
the sessions. He started off by telling the audience about
how he lost some money during the Harshad Mehta
scam period. Later on, he advised getting thorough
knowledge before embarking in investing.
During the sessions, basics about banks,
investment banks and commercial banks were
explained. The workings of mortgages, savings banks,
forward market, options, futures, investment companies,
mutual fund managers, were also touched upon.
Demats were given special attention and its
functioning was explained in detail. It was told that most
banks have Demat accounts for their clients. This was
started in 1996. 95% of shares are held in a
dematerialized form. That means they are on thecomputer. If you want to repossess them in physical
form, applying to your participating bank can do it. One
gets regular statements and one can even access it on
email.
Buying and selling is easy. The only essential is
an intimation slips like cheque books. Delivery
instruction is entered. Each bank charges fee for this
service at different rates but within a stipulated range.
A pan card is necessary to open a Demat account.
The other topic of interest was.. What are credit
and debit cards and how you should be careful when
running up credit card bills. It was explained that people
are allowed to pay a small part of the credit card dues.
But they do not realise that by paying a small part of
your credit card bill, the balance attracts a high, usurious
rate of interest. It was advised that a debit card is safer
as you cant use it unless you have a balance in your
bank.
Mr. M.V. Kini inaugurates one of the sessions
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The next topic was difference between an investor
and a speculator: An investor is someone who invests
wisely, and does not get influenced by rumors of high
rate of interest etc. But a speculator goes for high risk,
which may or may not give him the promised high rate
of return. Speculation is high risk business and you may
end up by losing your investment. It is better to be slow
and safe than run the risk of losing your capital.
If you want life cover, the most sensible thing is
to go for LIC. These
are pure life cover
products with
minimum premia.
Specially, if you take
life insurance at a
young age, the
premia is quite low.
Schemes likeUTI and other life
cover, personal
accident linked
policy with the
deposits cost much
more. The
commission on these is also much higher. Personal
accident can also be taken from non life insurance
companies and they are quite cheap.
Debentures, derivatives and mutual funds too
attracted attention. Debentures are borrowings bycompanies. If they run into problem, the debenture
holder will get his payment before those holding equity.
Derivatives; These are instruments where you,
can leverage small amount of investment into a larger
portfolio. But it carried a lot of risk as well
Mutual Funds. These fund managers take money
from individuals and financial institutions and invest it
in various equities. They have many plans You can opt
for whatever suits you best. It works out cheaper as
they can invest for you even in small units, in diverse
shares and have a professional management to do the
investing on your behalf.
Tips were given in regard to owning stocks. Those
present were advised that when investing one needs to
understand:
How much are you going to invest?
Object of investing
Financial goals,
How long will you keep an investment active
How much of a risk are you willing to take
Asset allocation
Long term strategy.
You need to be regular in investing
You must be disciplined and not get swayed byrumors as too much information is floating around
You must learn to take losses as a learning tool
because one does not always gain.
Diversifying is the key
Building wealth is a slow process. You can not be a
millionaire overnight, so do not trust people who
try and make you go in that direction. Chances are
they are misleading you.
There are always black sheep in the trade. Learn to
recognize them
Stock market : There is a primary and a
secondary market.
Primary market is an IPO, the price is fixed in
consultation with the promoters. Once that price is
decided, it is put on the market.
Once the initial primary market is done, the shares
then move to the secondary market. There are various
stock markets like Bombay stock exchange, national
stock exchange. Here the buyer and the seller of a stock
get together to buy or sell at a price negotiated by thetwo.
An investoris someone who invests
wisely, and does not get
influenced by rumors of
high rate of interest etc.
But a speculator goes for
high risk, which may ormay not give him the
promised high rate of
return.
Interested audience (from L to R): Mr. Subhash Palav,
Ms. Kranti Patankar and Prof. Godbole
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The stock markets also track the Indices. The
Index is calculated share price x no of outstanding
shares, then multiply by free floating market.
Market capitalization: This is arrived at when you
deduct the shares held by the promoters which do not
come into the market. Only the balance is to taken into
account for capitalisation.Bids change every minute depending on who
wants to sell at what rate and who is willing to buy at
the rate offered.
Brokers come into the picture to bring the two
together. Once a seller gets a buyer, the buyer has to
settle the amount due within a day. This is handed over
to the seller. If the buyer defaults, the broker is held
responsible. The shares then are put in to an account
and then auctioned off and the seller paid.
A challenge to new investors. Things to keep inmind.
Expected rate of returns. Decide your priorities
Do not go by market rumours.
Such rumours can lead to your downfall.
When you lose, use that as a learning tool, learn
from it.
Dont take blind decisions.
Read and understand all balance sheets whichcompanies send you instead of throwing it into trash
can
Read all the newspapers financial columns to
understand which way the scrips are moving. This will
make you understand the market.
If you do not understand, go to someone who
does and learn.
There are some products which will sell even in
a downturn. Go for such scrips.Do research on demographic buys so you know
who buys what, when.
Just because a scrip is cheap it does not mean is
not good.
The reverse also is true. All high priced scrips
need not necessarily be the best buy.
If you have made the targeted returns, it might
be a good idea to close that deal and invest afresh. Think
about it.
Above all read and understand all the rules and
regulatory details which will teach you where not to
venture.
Often, we do not know when to get out, especially
when the market is going down. It is better to cut your
losses.
Often the broker will tell you to buy when the
market is down. It may be an advice only to get his
brokerage. So check before you follow that advice.
When to buy, Indecision causes problems. Oftenit is not indecision but inertia. So, keep looking at your
portfolio regularly. Markets change fast so it is better
to keep abreast. Dont go by rumors.
Someone suggested one way of learning.
Do your investments on paper. A good idea is a
certain percentage in safe scrips deposits in nationalized
banks, Post office etc Fixed deposits in good companies.
It may have low returns.
Then invest some in scrips which are a little risky.
This will give a higher rate of returns and even if you
lose, you will still be safe. Your safe scrips will even it
out.
Try to do this for some six months and see if you
are on the right track. Then venture into the real market.
SEBI is supposed to be there for Investor
protection. Could they have forecast the 08 crash?
Mr. R. P. Vyas conducts the meeting with panache!
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May-June 2009 KEEMAT 13
Investors should not steered into buying some
scrips by giving slanted information.
Even the media often plays a part in this by
plugging some scrips over others. This could be a quidpro quo for advertisement revenues.
They also call experts to talk on the subject.
These persons are changed often depending on who is
in favor. It is not necessarily their expertise, but many
other factors play a part in choosing these experts.
Investor should be given correct timely
information.
Fair trading, No rigging should be indulged in
Insider trading which is rampant ought to becurbed to provide a level playing field.
Exit route should be available to everyone.
If a firm changes hands, and a new management
takes control, investors should be allowed an option to
exit.
But the best way to be a prudent investor is
Be aware, read up, and learn from your mistakes.
This is like an exam and more homework you
do, the better you will fare.
Be conservative and prudent.
But do take some risks, after due diligence. The
higher yielding scrips always carry some risks, but it is
worth taking, after careful study.
Decide on length of time you want to hold a
particular scrip or FD.
And above all do not succumb to greed. You can
not become a millionaire overnight. It is a slow and
steady process with many ups and down.
Each session ended with an oath which was taken
by all present:
I, hereby solemnly swear that as a member of
the Kuber programme I, shall proactively study,
understand and assimilate the opportunity and risk
involved in the investment of shares, bonds debentures
and other related financial instruments, offered at the
market place by corporate houses, financial institution
and other public and private players, with a view to
evolve and deploy a balanced investment policy,
contributing to the development of a stable, wealth
maximising platform for sustaining a stable and robust
financial market at home and abroad, while adhering
to the statutory and regulatory framework.
All the students were given participation
certificates. Dr. Kamath announced that since these
sessions were well received and this was only a basiccourse, he would, if there was demand he would arrange
seminars for advanced level training. The CGSI is
especially thankful to the faculty of MET who helped
in arranging the seminar.
Prof. Vijay Page, Director General of MET with Mr. Amonkar.
(from L to R): Mr. Radhakrishnan Nair and Prof Vijay Page
exchange pleasantries as Mr. B.V Desai looks on.
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14 KEEMAT May-June 2009
(from L to R): Dinesh Bhandare and Mr. Kamaal
Farooqui (Chairperson, Consumer Protection Council)
at a public meeting.
Mrs. Jamna Varadhachary and Dr. S.G. Bhat with Dr.
Meena Mehta of S.N.D.T College, at an awareness
campaign held in that college.
Dinesh Bhndrae addresses an awareness programme at
Green Fingers School, Kharghar.
Section of the audience at CGSI meeting at Kharghar Rail
Vihar on consumer awareness.
Gajanan Patil enthralls the students of Nirmala Niketan
with his talk on food adulteration.
Dinesh Bhandare talks of consumer empowerment at a
seminar at Dignity Foundation.
News in PicsNews in PicsNews in PicsNews in PicsNews in Pics
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May-June 2009 KEEMAT 15
It is a brand new financial
year and time for a brand new start.
Yes, the financial climate remains
inclement with the West in the
middle of a recession and the rest
of the world struggling to cope with
the collateral damage. The effect on
the stock market, considered as the
barometer of the economy, has been
nothing less than brutal. And
investors, risk spooked as they are,
dont know which way to turn. Well,
all I will say is that it is important
that one doesnt get carried away and
continues life with feet firmly on the
ground. Therefore, in an effort to
keep things in perspective I have
compiled a list of some basic
financial doctrines that one should
follow no matter how much the
panic (or in good times, theexuberance) all around.
1. PPF A sine qua non
I will go to the extent of saying
that without exception, every
Indian, male or female, whether
employed or having a business,
In the WIn the WIn the WIn the WIn the Wonderland of Investmentsonderland of Investmentsonderland of Investmentsonderland of Investmentsonderland of Investments
Make a Brand New Start in the New Financial YearSandeep Shanbhag
married or unmarried, should have
a PPF account ticking for them.
Leave aside the tax deduction, leave
aside the 8% tax-free interest this
is your social security. Over 16
years, an annual contribution of Rs.
70,000 grows to over Rs. 21 lakh
which is almost 30 times the annual
investment. This capital built over
time can serve multiple purposes
like catering to the
education of
children, medicalemergencies and
even retirement.
Have an
account in the name
of each and every
adult member of the
family, even if not a
taxpayer at present.
Invest as much as
you can up to the
maximum limit ofRs. 70,000 per
annum. Remember, Rs. 70,000 can
be invested in each account
separately. Invest at the beginning
of the year. Do not shy away from
PPF under the mistaken notion that
funds are locked up for 16 long
years. Yes, the term of PPF is 16
years but the average lock-in is just
six years. However, do not use the
premature withdrawal facility,
unless there is an emergency.
2. Arrangement between you &
your spouse
Agreed, husband and wife
have one mind and one soul. But
not for income tax. It is crucial to
have separate joint accounts, one for
husband and wife and the other for
wife and husband, even if one of
them is not assessed to tax. Payment
of EMIs, credit card bills and even
investments etc. should be from the
account of the person who is
actually liable to pay for the expense
or investment. This will help
tremendously, especially while
filing your tax return in the new ITR
form which requires individual
disclosures of high value
transactions.
3. Buying a House
I find that very often, property
is bought in the name of his wife by
the husband using his own funds.
Do not buy any housing property,
residential or otherwise, in the name
of the spouse with your funds. Do
not do so even if you already
possess a house. This creates
insurmountable difficulties later on,
especially when the house is to be
sold.
4. Housing Finance
In fact, even if you have the
wherewithal to purchase your own
house, it is better to opt for housing
finance. Tax breaks are available
only on borrowed funds and not on
the use of owners equity. Moreover,
in most cases, you will find that the
direct cost of borrowing is muchlesser than the tax saved. Real estate
can be co-owned. Buy the property
with both husband and wife having
an equal share. The loan should also
be taken equally and the interest and
principal payments for the same
should be made separately by each
from their respective bank account.
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If the above is carried out,
each is entitled to an interest
deduction of up to Rs. 1.5 lakh
under Sec. 24 and a principal
deduction of Rs. 1 lakh under Sec.
80C. So totally between the both of
you, up to Rs. 5 lakh of income will
escape tax!
5. Life Insurance
Life insurance is a necessity,
if and only if, the demise of the
bread winner would put immense
financial pressure on the family
members left behind. If that is not
the case, leave insurance alone.
Every product has its cost and so
does insurance. Do not buy a
product you do notneed or buy excessive
insurance which injures
your financial health. In
your effort to provide
for the future of your
family, do not rob it of
its present! Insurance is
like a life saving pill that
is to be administered
only when you need it.
Otherwise, the side-
effects of the pill maybe worse than the
imaginary disease. In
any case, do not buy life
insurance only because it forces
compulsory savings or it saves
taxes. Do not buy insurance for
your child. The childs death,
howsoever devastating on your
emotional health, would make no
difference to your financial status.
If you are so inclined, make
investments in the name of the child
such that by the time he/she
becomes a major the funds would
come in handy for needs such as
marriage, further education, setting
up of a business etc.
If you do need a life cover,
go in for low-premium, high-risk
cover policy such as term insurance.
In general avoid high cost
endowment and ULIPs.
6. Mediclaim
Mediclaim is a must for all,
taxpayers or otherwise, rich or poor,
young or old, in view of the highcost of hospitalisation. If you
havent bought a Mediclaim policy
so far, do so NOW! There is a tax
break of Rs. 15,000 available, but
that is not the point. Mediclaim is
for the good of you and your family
members the tax cut is just an
added benefit.
7. Invest in equity mutual funds
which have a track record
It is next to impossible to build
wealth without equity exposure.
Note that I use the word wealth
and not capital. Wealth is when your
capital brings a smile to your face.
Saving a part of your salary in bondsor FDs is not going to do that.
8. Do not invest in equity directly
unless you know what you are
doing
This is more of a corollary to
the above point. Mutual funds exist
to cut stock market risk. People do
more research and homework on the
next cell phone they intend to buy
than the next stock. Hard earned
money is invested in a hot stock
based on the recommendation of a
friend, acquaintance or a stock
market guru. I know of a friend who
bought a stock based as he happenedto listen to a conversation between
two strangers talking in the gym that
he goes to. Needless to say, he is
still waiting for the stock to move
up. Remember, the only way to
double your money quickly is to
fold it into two. Otherwise, invest
with a quality mutual fund,
regularly, as much as you can,
whenever you can.
9. Budget your spends
Last but not the least, budget
your monthly expenses and make
your investments at the beginning
of the month, each month, month in
month out. This way, there is no
way that you can overspend and
defer savings to the next month.
Someone I know used to do this but
then end up overspending on her
credit card. I actually advised her to
take a pair of scissors and cut thecard into two. It took six months to
get her finances back into shape. But
today, she is debt free and financially
much better off than what she was a
year ago.
To conclude
You will appreciate that the
abovementioned points really do not
need much of ones time and effort
to put into practice. They also do notdepend upon the level of the Sensex.
In other words, whether the index
reaches 5000 or 25000, these small
things make all the difference
between financial health or the lack
of it.
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May-June 2009 KEEMAT 17
Husband and wife are like liver and kidney. Husband
is the liver and the wife is the kidney. If the liver fails, the
kidney fails. If the kidney fails.. the liver manages with
other kidney!!
[][][]
Three dreams of a man:
To be as handsome as his mother thinks. To be as
rich as his child believes.
To have as many women as his wife suspects.
[][][]
Theres only one perfect child in the world and every
mother has it.
Theres only one perfect wife in the world and every
neighbour has it.[][][]
Generation Next Motto:
Neither will I marry
Nor I will allow my children to marry!!
[][][]
Whats the difference between Drug and Wine?
Drug is like a girlfriend that comes with an expiry
date. Wine is like a wife, The older it gets, longer the chatter!
[][][]
The Japanese have produced a camera that has such
... such fast shutter speed that it is capable of taking a
picture of a woman with her mouth shut!!!
[][][]
A banker is a fellow who lends you his umbrella
when the sun is shining and wants it back the minute it
begins to rain.
[][][]
An Indian in Arabia
An Indian, a German and a Pakistani got arrested
consuming alcohol which is a severe offence in Saudi
Arabia, so for the terrible crime they are all sentenced 20
lashes each of the whip. As they were preparing for their
punishment, the Sheikh announced:
The Best MedicineThe Best MedicineThe Best MedicineThe Best MedicineThe Best Medicine Its my wifes first birthday today, and she has asked
me to allow each of you one wish before your whipping.
The German was first in line, he thought for a while
and then said:
Please tie a pillow to my back.
This was done, but the pillow only lasted 10 lashes
and German had to be carried away bleeding and crying
with pain. The Pakistani was the next up. After watching
the German in horror he said smugly:
Please fix two pillows to my back.
But even two pillows could only last 15 lashes and
the Pakistani was also led away whimpering loudly.
The Indian was the last one up, but before he could
say anything, the Sheikh turned to him and said:
You are from a most beautiful part of the world
and your culture is one of the finest in the world. For this,
you may have two wishes! Thank you, your Most Royal
and Merciful Highness, Indian replied.
In recognition of your kindness, my first wish is
that you give me not 20, but 100 lashes.
Not only are you an honourable, handsome and
powerful man, you are also very brave. The Sheikh said
with an admiring look on his face.
If 100 lashes is what you desire, then so be it. And
what is your second wish,? The Sheikh asked. Indian
smiled and said, Tie the Pakistani to my back!!!
[][][]
Four monks decided to go into silence for a month.
They started out well enough, but after the first day, one of
the monk said, I wonder if I locked the door of my cell
at the monastery before we set out.
Another monk said, You fool! We decided to keep
silence for a month, and now you have gone and brokenit!
The third monk said, What about you? You have
broken it too!
Said the fourth, Thank God, Im the only one who
hasnt spoken yet!
[][][]
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CONSUMER GUIDANCE SOCIETY OF INDIA
BLOCK J, Azad Maidan, MAHAPALIKA MARG, MUMBAI 400 001.
Tel: 2262 1612 Fax: 2265 9715 E-mail: [email protected] Website: www.cgsiindia.org
MEMBER, CONSUMER CO-ORDINATION COUNCIL AND CONSUMERS INTERNATIONAL(CCC and CI are coalition of Indian and federation of world consumer organisations respectively.)
Registered under The Societies Registration Act XXI of 1860 (Ref. No. Bom. 33/1966 GBBSD 4/4/66) and under
the Bombay Public Trusts Act XXIX of 1950 (Reg. No. F-1381 (Bom.) 20/5/1966).
Printed, Published and Edited by Dr. Subraya Giridhar Bhat on behalf of Consumer Guidance Society of India,
and Published from Block J, Azad Maidan, Mahapalika Marg, Mumbai - 1.
and Printed at Emkay Printers, Gala No. 47, Bharatbazar Ind. Est., Gandhi Nagar, Worli, Mumbai - 18. Tel : 2492 4094.
Report on Consumer Awarness Programme
On March 19, the
SNDT campus played host
to a seminar on Consumer
Awareness on 17the March
2009. The CGSI had been
invited to hold the event by
Dr Meena Mehta, Reader, B
M Nanavati College of
Home Science, SNDT,
Matunga.
Dr. S. G. Bhat and Ms
Jamna Varadhachary spoke
on the occasion. Mrs
Varadhachary talked about
what the CGSI actually does
and gave the students tips
on how to be an aware
consumer and not to be
taken in by advertising. Dr
Bhat explained the technical points of adulteration, of milk, edible oils, spices etc. and to be vigilant on quality
and quantity. He advised the audience to avoid junk food and street food.
The students received the talk well and raised many questions.
SNDT Students engrossed in the session.
An Appeal
CGSI needs members to volunter Three Hours a Week for work relatedto consumer issues. As far as possible, the work will be in an area close to the
residential place or place of work of the volunteer. Kindly contact CGSI office
with your Name, Address and other details.
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May-June 2009 KEEMAT 19
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20 KEEMAT May-June 2009
Newspaper Reg. No.: RN 20897/72