Monthly Archives: May 2017

Online system for portfolio managers & venture capital funds

SEBI has introduced online system for portfolio managers & venture capital funds. Compliances under SEBI (Portfolio Managers) Regulations, 1993 and SEBI (Venture Capital Funds) Regulations 1996 and respective circulars can be done under the online system. Registration as a portfolio manager is also available under the online system. Venture Capital Funds have to submit applications for any request under the online system.

SEBI press release is at

http://www.sebi.gov.in/media/press-releases/may-2017/sebi-introduces-online-system-for-portfolio-managers-and-venture-capital-funds_34985.html

 

 

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Annual returns of NGOs

The Government has given one final opportunity to all associations/organizations which have applied for renewal of their registration under the Foreign Contribution (Regulation) Act, 2010 (FCRA) but not uploaded their Annual Returns from Financial Year 2010-11 to 2014-15. All such NGOs can upload their missing Annual Returns along with the requisite documents within a period of 30 days, starting from May 15, 2017 to June 14, 2017. Further no compounding fee will be imposed on them for late filing of Annual Returns during this period.

This exemption is one time measure and available to those associations who upload their missing Annual Returns from FY 2010-11 to FY 2014-15 within this period. The renewal of registration under FCRA cannot be granted unless the Annual Returns are uploaded by the organization.

Visit online portal of FCRA Services:

https://fcraonline.nic.in/home/index.aspx

Click here for Public Notice:

https://fcraonline.nic.in/home/PDF_Doc/fc_Notice_12052017_01.pdf

The Annual Returns Submission Status from Financial Year 2010-11 to 2014-15 for the Associations along with their FCRA Registration Number is also available at:

https://fcraonline.nic.in/home/PDF_Doc/fc_list_12052017.pdf

The User guide for submitting Annual Returns is available at:

https://fcraonline.nic.in/home/Documents/Instruction/FC4_returns.pdf

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License for manufacture of defence items

Vide Notification S.O. 1636 (E) dated 19.05.2017  of Ministry of Home Affairs, powers and functions under sub-section (1) of Section (5), clauses (b) and (c) of Section 7 and Chapter III of Arms Act, 1959 have been delegated to Secretary, Department of Industrial Policy and Promotion in respect of defence items included in the Schedule. Consequently, power to grant manufacturing license in respect of the category of arms and ammunition and defence items as per columns (2) and (3) of Schedule to the said Notification has been delegated to Secretary, DIPP.

Accordingly, Department of Industrial Policy and Promotion will now process the applications for grant of license for manufacture of defence items included in the said Notification.

All the interested Entrepreneurs/ Industries/Companies are requested to apply in Form A-6 of Arms Rules 2016 in 15 copies along with details and enclosures as mentioned in the Arms Rules 2016 to the Senior Development Officer (Industrial License), Department of Industrial Policy and Promotion, Industrial Licensing Section, Udyog Bhawan,New Delhi.A copy of the Arms Rules 2016 is available on the websites of Department of Industrial Policy & Promotion (www.dipp.gov.in) and Ministry of Home Affairs(www.mha.nic.in).

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EPFO payouts in digital mode

The Ministry of Labour, Govt. of India has ensured that payouts from the Employee Provident Fund schemes in the form of EPF benefits, pension disbursement and insurance claims be made by electronic or digital fund transfer method to the beneficiaries. Suitable amendments have been to the relevant social security schemes

(http://www.epfindia.gov.in/site_docs/PDFs/Circulars/Y2017-2018/Manual_Notification_DBT_3004.pdf).

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Exemptions from quoting Aadhar in I.T. return

Government has vide notification dated 11th May, 2017 exempted certain categories of individuals from quoting their Aadhar in the income tax returns, IF THEY NOT HAVE their Aadhar ID.

  1. An individual who is residing in the state of Assam, Jammu and Kashmir and Meghalaya.
  2. An individual who is a non-resident as per the Income-tax Act, 1961.
  3. An individual of the age of eighty years or more at any time during the previous year.
  4. An individual who is not a citizen of India.

Quoting of Aadhar in income tax returns has become mandatory from 1st July, 2017 unless the SC decides otherwise in an ongoing writ petition against the same in its Court.

 

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linking of PAN with Aadhar

The Income Tax (IT) Department has made it easy for taxpayers to link their PAN with Aadhaar. Responding to grievances of taxpayers regarding difficulties in linking PAN with Aadhaar as their names did not match in both systems (e.g., names with initials in one and expanded initials in another), the IT Department has come out with a simple solution now.

Taxpayers can go to http://www.incometaxindiaefiling.gov.in and click on the link on the Left Pane à Link Aadhaar, provide PAN, Aadhaar number and ENTER NAME EXACTLY AS GIVEN IN AADHAAR CARD (avoid spelling mistakes) and Submit. After verification from UIDAI, the linking will be confirmed.

Figure 1: Linking Aadhar with PAN on the Income Tax website

image 1

Figure 2: Linking Aadhar with PAN simplified

image 2

In case of any minor mismatch in Aadhaar name provided by taxpayer when compared to the actual data in Aadhaar, a One Time Password (Aadhaar OTP) will be sent to the mobile registered with Aadhaar.  Taxpayers should ensure that the date of birth and gender in PAN and Aadhaar are exactly same. In a rare case where Aadhaar name is completely different from name in PAN, then the linking will fail and taxpayer will be prompted to change the name in either Aadhaar or in PAN database.

There is no need to login or be registered on E-filing website. This facility can be used by anyone to link their Aadhaar with PAN.

This facility is also available after login on the e-filing website under Profile settings and choose Aadhaar linking. The details as per PAN will be pre-populated. Enter Aadhaar number and ENTER NAME EXACTLY AS GIVEN IN AADHAAR CARD (avoid spelling mistakes) and Submit.

 

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NEFT – half hourly settlements

RBI has vide its circular dated 8th May 2017 introduced half hourly settlements for NEFT transactions. Half hourly settlements would speed up the funds transfer process and provide faster credit to destination accounts. Presently there are 12 settlement cycles at hourly intervals. This would now be enhanced to 23 half hourly settlement cycles from 8.00 a.m. to 7.00 p.m. The banks have been advised to accept and credit the inward NEFT transactions on half hourly cycles.

The additional batches would be introduced from 10th July, 2017. Banks therefore have been given time to make their system ready and compliant with effect from that date.

Banks are required to send confirmation to the originator of the NEFT that the remittance has been credited to the account of the beneficiary. Destination banks have to send confirmation to the originating banks which in turn will send the message to the originator.

https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=10958&Mode=0

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timelines for stressed asset resolution

RBI circular dated 5th May, 2017

Please refer to the circular DBOD.BP.BC.No.97/21.04.132/2013-14 dated February 26, 2014 on “Framework for Revitalising Distressed Assets in the Economy – Guidelines on Joint Lenders’ Forum (JLF) and Corrective Action Plan (CAP)” and subsequent circulars/amendments in this regard.

2. The Framework aims at early identification of stressed assets and timely implementation of a corrective action plan (CAP) to preserve the economic value of stressed assets. In order to ensure that the CAP is finalised and formulated in an expeditious manner, the Framework specifies various timelines within which lenders have to decide and implement the CAP. The Framework also contains disincentives, in the form of asset classification and accelerated provisioning where lenders fail to adhere to the provisions of the Framework. Despite this, delays have been observed in finalising and implementation of the CAP, leading to delays in resolution of stressed assets in the banking system.

3. It is hereby clarified that the CAP can also include resolution by way of Flexible Structuring of Project Loans, Change in Ownership under Strategic Debt Restructuring, Scheme for Sustainable Structuring of Stressed Assets (S4A), etc.

4. In this context, it is reiterated that lenders must scrupulously adhere to the timelines prescribed in the Framework for finalising and implementing the CAP. To facilitate timely decision making, it has been decided that, henceforth, the decisions agreed upon by a minimum of 60 percent of creditors by value and 50 percent of creditors by number in the JLF would be considered as the basis for deciding the CAP, and will be binding on all lenders, subject to the exit (by substitution) option available in the Framework. Lenders shall ensure that their representatives in the JLF are equipped with appropriate mandates, and that decisions taken at the JLF are implemented by the lenders within the timelines.

5. It shall be noted that

(i) the stand of the participating banks while voting on the final proposal before the JLF shall be unambiguous and unconditional;

(ii) any bank which does not support the majority decision on the CAP may exit subject to substitution within the stipulated time line, failing which it shall abide the decision of the JLF;

(iii) the bank shall implement the JLF decision without any additional conditionalities; and

(iv) the Boards shall empower their executives to implement the JLF decision without requiring further approval from the Board.

6. Any non-adherence to these instructions and timelines specified under the Framework shall attract monetary penalties on the concerned banks under the provisions of the Banking Regulation Act 1949.

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Clarification on Maternity Act

The Government has notified the Maternity Benefit (Amendment) Act,2017 on 28th March,2017 and the provisions of the Amendment Act have come into force with effect from 1st April,2017, except those relating to crèche facility {Section 4(1)} which would come into force from 01.07.2017.

Keeping in view queries received from various quarters, the Ministry of Labour & Employment, on 12.04.2017, had issued certain clarifications on various provisions of Maternity Benefit (Amendment) Act, 2017. One of the clarifications issued by the Ministry stated that the enhanced maternity benefit, as modified by the Maternity Benefit (Amendment) bill, 2016 can be extended to women who are already under maternity leave at the time of enforcement of this Amendment Act.

Having received further queries and to remove doubts, it is further clarified that it is mandatory on the part of employers to extend the benefit of enhanced maternity leave to those women workers who were already on maternity leave on the date of enforcement of the Maternity Benefit (Amendment) Act,2017 i.e. as on 01.04.2017.

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Online Regn for SEBI intermediaries

http://www.sebi.gov.in/legal/circulars/may-2017/online-registration-mechanism-for-securities-market-intermediaries_34793.html

SEBI has started the process for online registration for all financial market intermediaries. The link for online registration is

https://siportal.sebi.gov.in/intermediary/index.html

The portal shall include online application for registration, processing of application, grant of final registration, application for cancellation/ surrender, submission of periodical reports, requests for change of address/ name change etc.

The portal is now applicable for the following intermediaries, viz

i) Stock Brokers

ii) Sub-brokers

iii) Merchant Banker

iv) Underwriters

v) Registrars to an Issue and Share Transfer Agent

vi) Debenture Trustees

vii) Bankers to an Issue

viii) Credit Rating Agency

The portal shall be operational for depository participants from 31st May, 2017.

Henceforth all applications for registration/ surrender/ other requests shall be made on the portal only.

However, the applicants will be separately required to send relevant documents viz. declarations/ undertakings required as part of the application process, in physical form but for record keeping purpose only. The online processing will not be impacted.

The applications in respect of stock brokers/ sub brokers/ depository participants shall be continued to be made through stock exchanges/ depositories respectively. Hard copies of documents submitted by these intermediaries shall be retained by the stock exchanges/ depositories and will be produced at SEBI whenever called for.

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NOF for ARCs

RBI has vide its notification dated 28th April, 2017 stipulated minimum Net Owned Fund (NOF) requirement by Asset Reconstruction Companies (ARCs) at Rs.100 crores on an ongoing basis.

All the ARCs which are already registered with Reserve Bank of India as on the date of the Notification and not having the revised minimum NOF as on date shall achieve a minimum NOF of ₹ 100 crore latest by March 31, 2019. ARCs shall submit a certificate from their Statutory Auditors periodically as evidence of compliance thereof.

 

NOF shall be arrived at by reducing from Owned Fund (OF), as defined in the Notification DNBR (PD).CC.No.03/SCRC/26.03.001/2015-16 dated July 1, 2015, the amounts representing –

i. investments of the ARC in shares of –

  1. its subsidiaries;
  2. companies in the same group;
  3. all other ARCs; and

ii. the book value of debentures, bonds, outstanding loans and advances made to, and deposits with, –

  1. subsidiaries of the ARC; and
  2. companies in the same group,

to the extent such amount exceeds 10% of the OF.

Copy of the RBI notification can be found here

https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=10949&Mode=0

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