Archives for September 2017

MCA

MCA has issued Office Memorandum as recommendation and has invited Public Comments for integration of Name Reservation ( INC-1) with Spice E-Form under Companies Act, 2013. Spice E Form has been introduced whereby procedures of obtaining DIN by the proposed Directors, name reservation, incorporation, allotment of Pan has been integrated into one service, facilitating incorporation of Company. However, availing DIN allotment or name reservation services independently is also simultaneously available to cater to those stakeholder who wish to proceed with incorporation in a piecemeal manner. Therefore, Suggestions are invited from the Stakeholders for further simplification of processes aimed at further easing the starting of a business, which may be filed online at comments.nameintegration@mca.gov.in on or before 05/11/2017.

CBDT

CBDT has issued the notification to the prescribed the procedure to be followed w.r.t TDS on interest on deposits made under the Capital Gains Accounts Scheme, 1988 where the depositor has deceased. It has been brought to the notice of CBDT that in cases of deceased depositor who has made deposits under the Capital Gains Accounts Scheme, 1988, the banks are deducting TDS on the interest earned on such deposits in the hand of the deceased depositor and issuing TDS certificates in the name of the deceased depositor, which is not in accordance with the law. The Principal Director General of Income-tax (Systems) has specifies that in case of deposits under the Capital Gains Accounts Scheme, 1988 where the depositor has deceased TDS on the interest income accrued for and upto the period of death of the depositor is required to be deducted and reported against PAN of the depositor, and TDS on the interest income accrued for the period after death of the depositor is required to be deducted and reported against PAN of the legal heir, unless a declaration is filed under sub-rule(2) of Rule 37BA of the Income-tax Rules, 1962 to that effect.

Ministry of Labour & Employment

The Ministry of Labour & Employment has launched the Platform for Effective Enforcement for No Child Labour (PENCIL) Portal at the National Conference on Child Labour organised by the Ministry of Labour and Employment, Government of India. The PENCIL is an electronic platform that aims at involving Centre, State, District, Governments, civil society and the general public in achieving the target of child labour free society. Ministry has also launched the Standing Operating Procedures (SOPs) for the enforcement of legal framework against child labour. The SOP is aimed at creating a ready reckoner for trainers, practitioners and monitoring agencies to ensure complete prohibition of child labour and protection of adolescents from hazardous labour ultimately leading to Child Labour Free India. The PENCIL Portal (pencil.gov.in) has various components, namely Child Tracking System, Complaint Corner, State Government, National Child Labour Project and Convergence. The Districts will nominate District Nodal Officers (DNOs) who will receive the complaints and within 48 hours of receiving, they will check the genuineness of the complaint and take the rescue measures in coordination with police, if the complaint is found to be genuine.

CBEC

CBEC has notified the amendments to the Customs Valuation (Determination of Value of Imported Goods) Rules 2007, which may be called the Customs Valuation (Determination of Value of Imported Goods) Amendment Rules, 2017 and shall come into force on the date of their publication in the Official Gazette. These rules lays that “place of importation” means the customs station, where the goods are brought for being cleared for home consumption or for being removed for deposit in a warehouse;” and “The value of the imported goods shall include the cost of transport, loading, unloading and handling charges associated with the delivery of the imported goods to the place of importation and the cost of insurance to the place of importation”. Further, where the cost of insurance is not ascertainable, such cost shall be 1.125% of free on board value of the goods. It is also clarified that if the goods imported by sea or air and transshipped to another customs station in India, the cost of insurance, transport, loading, unloading, handling charges associated with such transshipment shall be excluded.

CBEC

The Central Government has notified the Customs and Central Excise Duties Drawback Rules, 2017 to replace the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995 which shall be effective from 1.10.2017. The Central Government has also revised All Industry Rates (AIRs) of Drawback which shall also comes into force on 1.10.2017. In the revised Rules, definition of Drawback has been amended to provide for drawback of Customs and Central Excise duties excluding integrated tax leviable under sub-section (7) and compensation cess livable under sub-section (9) respectively of section 3 of the Customs Tariff Act, 1975 chargeable on any imported materials or excisable materials used in the manufacture of goods exported. Further, references to input services and Service Tax have been omitted. With trade facilitation in view, tenure of the Drawback Committee constituted by the Central Government has been extended to 31.12.2017 to expeditiously look into issues arising from the changes made. Accordingly, exporters may immediately come forward with representations with supporting data and documents, if any, for higher rates than rates provided.

RBI

RBI has notified the amendments to Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000 As per the existing norms, the limit for investment by Foreign Portfolio Investors (FPIs) in corporate bonds is ₹ 244,323 crore which includes issuance of Rupee denominated bonds overseas (Masala Bonds) by resident entities of ₹ 44,001 crore (including pipeline). The Masala Bonds are presently reckoned both under Combined Corporate Debt Limit (CCDL) for FPI and External Commercial Borrowings (ECBs). On a review, and to further harmonise norms for Masala Bonds issuance with the ECB guidelines, with effect from October 3, 2017, Masala bonds will no longer form apart of the limit for FPI investments in corporate bonds. They will form a part of the ECBs and will be monitored accordingly. The amount of ₹ 44,001 crore arising from shifting of Masala bonds will be released for FPI investment in corporate bonds over the next two quarters as prescribed in the circular. All other existing conditions for investment by FPIs in the debt market remain unchanged.

News from NIRC of ICSI

NIRC of ICSI is organisingOne Day Seminar onForeign Exchange Management Act (FEMA), on Wednesday, the 27th September, 2017, at Hotel Crown Plaza, Twin District Centre, Sector – 10, Rohini, New Delhi – 110085 (Near Rohini West/Rithala Metro Station). Fee:Rs.1,600/- per delegate inclusive of GST (Rs.1000/- for students) ; FREE for Corporate Members of NIRC. PCH – 4.

MCA

MCA has notified the Companies (Restriction on Number of Layers) Rules, 2017 which shall come into force on the date of their publication in the official Gazette i.e 20-09-2017. On and from the date of commencement of these rules, no company, other than a company belonging to a class specified, shall have more than two layers of subsidiaries. However, companies are allowed to acquire a Company incorporated outside India with subsidiaries beyond two layers as per the laws of such country. Exemptions are provided to the Banking Company, Non Banking Financial Company, Insurance Company and to Government Company. Every Company other than a Company exempted, existing on or before the commencement of these rules, which has number of layers of subsidiaries in excess of the 2 layers, shall file, with the Registrar a return in Form CRL-1 disclosing the details specified therein, within a period of one hundred and fifty days (150 days) from the date of publication of these rules in the official Gazette and shall not, after the date of commencement of these rules, have any additional layer of subsidiaries over and above the layers existing on such date. Penalty provisions in case of contraventions are also being prescribed through the Rules and shall be applicable on the Company and its officers in default.

MCA

MCA has notified the amendments to the Companies (Acceptance of Deposits) Rules, 2014 which may be known as the Companies (Acceptance of Deposits) Second Amendment Rules, 2017 and shall be applicable from the date of publication in the official Gazette i.e 19-09-2017. Ministry has allowed specified IFSC Companies (means an unlisted public company which is licensed to operate by the RBI or SEBI or IRDA from the International Financial Services Centre located in an approved multi services Special Economic Zone set-up under the Special Economic Zones Act 2005) to accept from its members monies not exceeding one hundred percent of aggregate of the paid-up share capital, free reserves and securities premium account and such Company shall file the details of monies so accepted to the registrar in Form DPT-3. Further, the maximum limit in respect of deposits to accept from members shall not apply to Private Companies, which are Start-up for five years from the date of its incorporation and companies having borrowing from banks or financial institutions or any body corporate is less than twice of its paid-up share capital or fifty crores rupees, whichever is less.

SEBI:

SEBI has issued a circular to provide integration of broking activities in Equity markets & commodity derivatives markets under single entity. Restriction on stock brokers dealing in securities (other than commodity derivatives) to deal in commodity derivatives has been done away with. Similarly, restriction on stock brokers dealing in commodity derivatives to deal in other securities has also been done away with. Therefore, post these amendments, a stock broker can deal in commodity derivatives and other securities under a single entity, thereby facilitating ease of doing business. Further, to facilitate integration between stock brokers, it is clarified that client account may be transferred from one stock broker to the other stock broker, by taking the express consent of the client through a verifiable mode of communication and thereby continuing with the existing set of documentation in respect of broker client relationship.

SEBI

SEBI, in order to align the requirements specified for listing under schemes of arrangement under Clause III (A)(1)(b) of Annexure I of the Circular with those specified under Rule 19(2)(b) of SCRR, has amended the Clause III (A)(1)(b) of Annexure I of Circular No. CFD/DIL3/CIR/2017/21 dated March 10, 2017. Accordingly, at least twenty five per cent of the post-scheme paid up share capital of the transferee entity shall comprise of shares allotted to the public shareholders in the transferor entity. Further, if an entity which does not comply with the above requirement may satisfy that the entity has a valuation in excess of Rs.1600 crore as per the valuation report; the value of post-scheme shareholding of public shareholders of the listed entity in the transferee entity is not less than Rs.400 crore; at least ten percent of the post-scheme paid up share capital of the transferee entity comprises of shares allotted to the public shareholders of the transferor entity; and, the entity shall increase the public shareholding to at least 25% within a period of one year from the date of listing of its securities and an undertaking to this effect is incorporated in the scheme.

CBDT:

dirtpl4 by 29th September, 2017. In order to address these concerns w.r.t a taxpayer who is liable to discharge part of its tax liability by way of advance tax has to bear additional burden of interest for default of advance tax, in case total advance tax paid for the year falls short of the assessed tax by ten percent or more.