27 April 2020 News and Updates

Corporate Snippets on April 27

Ø India seeks IMF, WB help to deal with IIP data gaps

Ø Factories fire up in Europe to pull economy back

Ø GMR Hyderabad Airport connects to African markets with cargo services

Ø NABARD lines up term loan facility for MFIs

Ø CBIC clears Rs 10k cr GST, customs refund in 16 days

Ø India's US G-Sec holdings at record high in Feb

Ø Finance Ministry, SEBI question mutual funds on Franklin Templeton fiasco

Ø Days after deal with Facebook, RIL starts WhatApp-based online portal

Ø ICICI Pru Life's Q4 takes a hit on higher share of ULIPs, Covid-19

Ø Finance Ministry likely to present new GDP, budgetary targets by July

Ø Yes Bank scam: CBI takes DHFL promoters Wadhawan brothers into custody

Ø IT officers pitch for 40% tax on super rich, new Covid cess

Ø IRB Infra’s board approves ₹2,500-cr fund-raise plan

Ø NTPC to procure fuel cell buses, cars for Delhi, Leh

Ø Mekins Industries develops ultra violet light-based disinfectant trolley

Ø Covid-19 may punch a big hole in petro-tax tank of Centre, States

Ø Telcos may do better in Q4, but there were no gains for Bharti Infratel

Ø Transportation of employees and goods remain key challenges to restart biz: CII

Ø VIX falls 54% from high, investors may be underestimating risks

Ø 47% of Indian startups and SMEs have less than a month of cash left: Survey

Ø Foodgrain stocks hit all-time high of 73.85 mt in April

Ø Union Bank plans to lower stake in IndiaFirst Life to less than 10 per cent

Ø IBBI excludes lockdown from resolution time frame

Ø India's holding of US government securities hits record high of $177.5 billion in Feb

Ø SAARC nations unveil emergency stimulus packages to mitigate Covid19 economic fallout

.

===========>

.

👉 The National Company Law Tribunal on Friday has issued a notice to Delhi Gymkhana Club Administration on a plea filed by Central government to take over the affairs of the club.

The case of the petitioner (Central Government) is that the working and affairs of the club are conducted in a manner which is against public interest and received various complaints against the Club administration and the same were inspected by the Central Government as provided under section 206 of the Companies Act, 2013.

The Central Government carried out investigation and found the following:-

The Members of General Committee are giving undue favour to few persons at the expense of General public.

Money has been called fraudulently by the GC (General Committee) members by inducing and alluring the new applicants (for memberships) to apply for membership at a higher membership fee (which is enhanced from time to time) when the GC itself is aware of the fact that the vacancy rate per annum is between 120 to 135 members and the company has a long waiting list from 1972 onwards. Whereas a minimal amount is being collected from permanent members and other members of the company who enjoy the benefits and privileges of the Club at a subsidized rate even without having the voting power.

The successive General Committees of the Club have twisted the objects of the company and remained in control of the Club by an unauthorized and complicated succession mechanism.

The management of the Club was carried out in violation of its articles of association and provisions of Companies Act, 2013.

Rampant discrepancies with respect to admission of members and financial and administrative irregularities in management of club.

Mismanagement of funds received by way of the registration fee from applicants, anomalies in the number of members of the company, false statement in balance sheets, etc.

The aforesaid acts of the M/s Delhi Gymkhana Club are in violation of section 5, 166 & 179 of the Companies Act, 2013. The Central Government has moved a petition before the NCLT under section 241 & 242 of the Companies Act.

👉 The Insolvency and Bankruptcy Board of India (IBBI) is making efforts to improve the governance structure of Registered Valuers’ Organisations ( RVO), the frontline organisations for the development and regulation of valuation professions.

It has now clarified that the promoter organisation of an RVO cannot appoint its own members — shareholder member in the case of a company, a trustee in case the promoter is a trust, and a professional member in case the promoter is a professional body — as independent directors in the RVO. The government had tasked the IBBI with the regulatory oversight of valuation professions.

Under the prevailing rules, the chairperson of an RVO is required to be an independent director, and a shareholder of an RVO is not allowed to be appointed as an independent director. The board of an RVO should comprise 50 per cent nominee directors and 50 per cent independent directors.

However, this was leading to situations where the promoters/shareholders of the RVO were appointing their own members as independent directors (and consequently chairperson) to retain control of the board. The IBBI has brought the latest clarification to 

ensure that the letter and spirit of the rules are followed, sources said.

.

===========>

.

Supreme Court in the case of  UOI vs. U.A.E. Exchange Centre  describes that Taxability of Liaison Offices under DTAAs: The activities carried on by the liaison office of the non-resident in India as permitted by the RBI, demonstrate that the liaison office must steer away from engaging in any primary business activity and in establishing business connection as such. It can carry on activities of preparatory or auxiliary nature only.

High Court of Gujarat gave an important judgment dated regarding detention, seizure and release of goods and conveyance on deposit  in case of Rajkumar Maheshwari V. Union of India [2020] 114 taxmann.com 400 (GUJARAT)

Authority on Advance Rulings (AAR), Karnataka has ruled that GST is applicable on residential accommodation sublet by a tenant, a ruling that experts said could open a Pandora’s box of litigations. In a case involving about 42 single rooms having been sublet by a tenant to students for periods ranging between three months to 11 months, AAR noted that the property given out for sub-renting matched that of a hotel – rooms with attached bathrooms – “which can by no imagination be termed as residential dwelling”, or a house.

GoI’s decision to block the automatic route for approving foreign direct investments (FDI) from China has surprised many, and not just Chinese investors. But the decision was probably arrived at after much deliberation, and is meant to be used as a diplomatic lever in dealing with Beijing.

Karnataka based company has moved Supreme Court challenging the Constitutional validity of two Government orders which directed employers to retain their employees and pay full wages throughout the duration of the ongoing nationwide lockdown.

.

===========>

.

👉 While hearing an urgent petition during the extended lockdown period moved by the NBCC, the National Company Law Appellate Tribunal ('NCLAT') declined to stay the implementation of the modified resolution plan and directed the state - run NBCC to acquire the debt ridden Jaypee Infratech and complete over 20,000 pending flats, but said the direction was subject to its final order.

Justice Bansi Lal Bhat, acting Chairperson and Justice Anant Bijay Singh, Member (Judicial) also directed Jaypee Infratech's Interim Resolution Professional Anuj Jain ('IRP') to constitute an interim monitoring committee comprising of representatives from NBCC and its three main lenders, namely - IDBI Bank Ltd., the lead lender of the consortium, IIFCL and LIC for the 'Successful implementation of Resolution Plan'.

The honourable bench held:

"Meanwhile, till further orders, the approved 'Resolution Plan' may be implemented subject to outcome of this Appeal. The Interim Resolution Professional may constitute 'Interim Monitoring Committee' comprising of the 'Successful Resolution Applicant', i.e., the Appellant and the three major Institutional Financial Creditors, who were Members of the 'Committee of Creditors' as named above."

During the proceedings, counsel for IRP stated that he intended to file an appeal with regard to some observations made in paragraph 103 of the impugned order.

NCLAT issued notices to ICICI Bank Ltd., the dissenting creditor who is entitled to cash payment pursuant to the modification; IDBI Bank and IRP directing them to file their replies and rejoinders, if any.

The matter is listed for 'admission after notice' on May 15th.

NBCC had filed an appeal against the order of NCLT challenging the modification to its bid for Jaypee Infratech. NCLT had approved NBCC's offer on March 3 but had allowed the objections by the dissenting creditors ICICI Bank and Yamuna Expressway Industrial Development Authority and directed payment to unclaimed fixed deposit holders. NBCC contended that NCLT had exceeded its jurisdiction in making such modifications by ordering direction to pay ICICI Bank an amount equivalent to what it would have received in the event of liquidation, along with interest, in 12 installments.

👉 The insolvency regulator has issued notifications to exclude the lockdown period following the Covid-19 outbreak from the time frames governing corporate insolvency resolution or liquidation processes.

Introducing a special provision in the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, the regulator said: “…the period of lockdown imposed by the central government in the wake of Covid-19 outbreak shall not be counted for the purposes of the time-line for any activity that could not be completed due to such lockdown, in relation to a corporate insolvency resolution process.” A similar amendment to the regulations for liquidations under the insolvency and bankruptcy code was also notified.

The insolvency and bankruptcy code (IBC) stipulates that the resolution process of a stressed company will have to be completed in a maximum of 270 days.

Accordingly, various processes are to be completed within specified time frames. The amendment to the resolution regulation would come into force retrospectively from March 29, while that to the liquidation regulation would take effect from April 17. The Insolvency and Bankruptcy Board Of India (IBBI) has clarified that given the lockdown, the notifications couldn’t be printed in the official gazette on time. However, the regulator had already posted the decisions on its official website well on time, specifying the date from which these amendments would take effect, with a note that these will also be printed in the government’s gazette.

So, the apparent retrospective nature of the latest notifications doesn’t harm stakeholders’ interests.

Commenting on the move, Daizy Chawla, senior partner at Singh & Associates, said: “This was the need of the hour, as due to the lockdown many procedures which are to be done as per the timelines provided under the corporate person regulations as well liquidation process could not be performed and the adjudicating authority (NCLT) would otherwise be flooded with applications for excluding such period or extension of timelines where the period prescribed under the code has already expired.”

.

===========>

.

👉🏻Govt declares banking industry as a public utility service for six months till October 21

(Govt has declared banking industry as a public utility service for six months till October 21 under the provisions of the Industrial Disputes Act) 

👇🏻 👇🏻 👇🏻

https://bit.ly/3cDB5Mu

👉🏻RBI allows banks to issue electronic cards for overdraft accounts

(RBI permitted banks to issue electronic cards to persons having overdraft accounts that are only in the nature of personal loan without any specific end-use restrictions)

👇🏻 👇🏻 👇🏻

https://bit.ly/3cDAJFE

👉🏻Companies Fresh Start Scheme | LLP Settlement Scheme

(Companies Fresh Start Scheme 2020 and LLP Settlement Scheme 2020 discussed by Adv.(CA) Arun Saxena)

👇🏻 👇🏻 👇🏻

https://bit.ly/2y0yxcD

.

===========>

.

Basir Ahmed Sisodiya vs. ITO (Supreme Court) S. 68 Bogus Purchases: Though the assessee failed to prove the genuineness of the purchases during the assessment proceedings, he filed affidavits and statements of the dealers in penalty proceedings. That evidence fully supports the claim of the assessee. The CIT (A) accepted the explanation of the assessee and recorded a clear finding of fact that there was no concealment of income or furnishing of any inaccurate particulars of income by the assessee. Consequently, the quantum addition will also have to be deleted. 

DGFT extends Import Validity period and Export Obligation period in Advance Authorizations / DFIA [Read Circular] Read more at: https://www.taxscan.in/dgft-extends-import-validity-period-and-export-obligation-period-in-advance-authorizations-dfia/55725/

GST rates should be suspended/reduced on critical items, including surgical masks, disposable gloves, ventilators, hand sanitisers, etc. Hospital services are exempt from output GST. However, hospitals routinely incur several input taxes, including huge GST outlay on capital procurement of equipment, and recurring GST on medical devices/ items/drugs and services such as rent/marketing/R&D. As ITC facility is not available for exempt-supply, these credit costs are built into the price.

RBI got lukewarm response from banks for availing three-year liquidity at the maiden auction on Thursday under the Targeted Long-Term Repo Operations (TLTRO) 2.0. The auction proceeds are specifically meant for deployment in the debt papers of small- and mid-size non-banking finance companies (NBFCs) and microfinance institutions (MFIs). As against the notified amount of ?25,000 crore, the RBI received 14 bids aggregating Rs.12,850 crore. 

Union Cabinet has cleared a proposal from the Corporate Affairs Ministry to give companies relief from insolvency for the next six months via amendment to Insolvency and Bankruptcy Code (IBC), 2016. This was cleared on April 22 and has been moved as a one-time measure.

.

===========>

.

👉 Amid lockdown, a fresh power tussle between former and present bureaucrats started in the national capital on Friday as the National Company Law Tribunal (NCLT) agreed to hear a petition moved by the Ministry of Corporate Affairs (MCA) alleging “fraudulent and rampant mismanagement of affairs” at Delhi Gymkhana Club.

The MCA had, earlier this week, petitioned the NCLT to suspend the general committee of the club with immediate effect, and replace it with a central government-appointed administrator. The Ministry had, in its plea, also said that the club should be barred from accepting new members and a new 15-member government-appointed committee should manage the club.

The new panel would also undertake a “restructuring” so that the club “functions as per the terms of its memorandum and articles of association”, the MCA had said in its petition, a copy of which The Indian Express has seen.

The club’s 16-member governing body, headed by retired Lieutenant General D R Soni, has been given time till May 8 to respond to charges levelled by the MCA. The senior counsel appearing for the club, meanwhile, told the tribunal that they would not accept any applications for new membership until May 13, when the case is scheduled to be next heard by the NCLT.

The entire issue, sources close to the matter said, is “an ego battle” between members of the club and those seeking to be members. “A registrar general of the Ministry of Corporate Affairs was denied membership because he refused to pay the additional amount that was demanded by the club to keep him on the waiting list. He has got this petition filed,” senior advocate Vikas Singh, appearing for Delhi Gymkhana club, said, without naming the bureaucrat.

👉 The National Company Law Tribunal ('NCLT'), established under the Companies Act, 2013, has emerged as the forum of choice for the purpose of 'recovery' of debt from corporate debtors under the Insolvency and Bankruptcy Code, 2016 ('IBC'), even though it was not established with the intent to enforce and effect recovery of debts. As much as everyone, including the learned members of the NCLT, often insist to the contrary, the stark reality is that the NCLT has become indeed, a forum to arm-twist corporate debtors to effect recovery of monies by confronting them with the fear of facing corporate death in the form of insolvency resolution or liquidation.

Statistics don't lie. Therefore, to decipher whether the NCLT really emerged as a forum of choice to effect such recoveries, we must see the recovery rate which has emerged? To confine our analysis for the present, we may take the case of only financial debt (i.e. bad loans), recoverable by banks. As per the data for Financial Year 2018-2019 released by the Reserve Bank of India, scheduled Commercial banks in India recovered a staggering amount of Rs. 70,819 Crores out of claims of Rs. 1,66,600 Crores under the IBC mechanism (which translated to an impressive recovery percentage of 42.5%). To put this figure in perspective, a measly recovery of Rs. 41,876 Crores out of claims of Rs. 2,89,073 Crores (translating to a paltry recovery percentage of only 14.5%) was effected under the SARFAESI Act. These numbers infact justify the newly discovered proclivity of banks to advert to the IBC mechanism to make good their bad loans.

Under the IBC regime, a financial creditor need to satisfy only the bare requirement, which is best captured in the words of Rohinton F. Nariman, J., in Innoventive Industries Ltd. v. ICICI Bank, (2018) 1 SCC 407, it reads :

"28. When it comes to a financial creditor triggering the process, Section 7 becomes relevant. Under the Explanation to Section 7(1), a default is in respect of a financial debt owed to any financial creditor of the corporate debtor — it need not be a debt owed to the applicant financial creditor. Under Section 7(2), an application is to be made under sub-section (1)….. Under Rule 4, the application is made by a financial creditor in Form 1 accompanied by documents and records required therein. …... The speed, within which the adjudicating authority is to ascertain the existence of a default from the records of the information utility or on the basis of evidence furnished by the financial creditor, is important. This it must do within 14 days of the receipt of the application. It is at the stage of Section 7(5), where the adjudicating authority is to be satisfied that a default has occurred, that the corporate debtor is entitled to point out that a default has not occurred in the sense that the "debt", which may also include a disputed claim, is not due. A debt may not be due if it is not payable in law or in fact. The moment the adjudicating authority is satisfied that a default has occurred, the application must be admitted unless it is incomplete, in which case it may give notice to the applicant to rectify the defect within 7 days of receipt of a notice from the adjudicating authority. Under sub-section (7), the adjudicating authority shall then communicate the order passed to the financial creditor and corporate debtor within 7 days of admission or rejection of such application, as the case may be."

.

===========>

.

👉🏻SEBI slaps Rs 30 lakh fine on six entities for fraudulent trade

(SEBI has imposed a total penalty of Rs 30 lakhs on six individuals for indulging in fraudulent trading)

👇🏻 👇🏻 👇🏻

https://bit.ly/2KB3Z3K

 

👉🏻IBBI excludes lockdown from resolution time frame

(IBBI has issued notifications to exclude the lockdown period following the Covid-19 outbreak from the time frames governing CIRP or liquidation processes)

👇🏻 👇🏻 👇🏻

https://bit.ly/3aDAfOf

 

Thanks for reading

24 April 2020 News and Updates

24th April 2K20

Ø  Govt suspends insolvency provisions from IBC for 1 year

Ø  RBI's liquidity plan for non-bank lenders falters

Ø  Indian economy in its worst quarter since mid-1990s

Ø  Europe on course for unprecedented recessions

Ø  26 million have sought US jobless aid since virus hit

Ø  Govt working to reimburse MSME's dues: Gadkari

Ø  India’s crude oil production falls 6% in FY20

Ø  No country should have any concern over India's new FDI policy: Govt

Ø  CII sees Covid-19 shrinking FY21 GDP by 0.9% in worst-case scenario

Ø  MCX asks software vendor to enable negative price trading after broker ire

Ø  Sebi halves post-buyback cooling off period for firms to six months

Ø  PM Modi, Sitharaman to meet on Friday to finalise second stimulus package

Ø  Housing sales fall 26% in Jan-March, new supply dips 51%: Report

Ø  Covid-19: Centre considering allowing industry use ESI scheme funds for wage payments

Ø  ArcelorMittal Nippon Steel India logs record output of 7.23 mt in FY20

Ø  Refiners stare at Rs 25,000-cr inventory loss

Ø  Railways offers incentives to freight customers

Ø  As government wields stick, EXIM logistics players fall in line

Ø  Coal India’s 2020-21 production target set at 710 million tonnes

Ø  Bharti Infratel posts Q4 profit of Rs 650 cr

Ø  Govt to suspend insolvency provisions from IBC for up to 1 year: Report

Ø  Jeff Bezos, Elon Musk among billionaires gaining net worth in pandemic: Report

Ø  ITC says manufacturing capacities currently between 20% to 60%

Ø  Tata Motors' JLR to restart some production in Europe from May 18

Ø  Lockdown delays Bharti Infratel-Indus Towers merger, deal postponed for 4th time

Ø  TLTRO round one: India Inc raises nearly ₹52,000 crore

Ø  RBI measures to ease concerns of NBFCs, provide relief to banks, borrowers

Ø  DIPAM may look at sale of smaller CPSEs to larger counterparts to meet FY21 disinvestment target

Ø  Reliance cuts crude processing at Jamnagar SEZ refinery by 24 per cent

Ø  India's remittances likely to decline by 23% due to coronavirus: World Bank

Ø  Finance Ministry notifies changes in FDI policy under FEMA law

Ø  Donald Trump signs immigration order curbing green cards

.

==========>

.

Central Government is considering another excise duty hike on petrol and diesel. The hike could be notified after the resumption of economic activity once the nationwide lockdown is broadly lifted. “There may be marginal hike in excise duty to offset revenue loss due to lack of demand. 

Sebi proposed easier pricing norms, as well as exemptions from open offers, for investments made through the preferential route in stressed listed companies. According to the regulator, the existing pricing guidelines for buying via the preferential route are too onerous for any financial investor to consider investments in a stressed company. 

Bombay High Court To Forego Summer Vacation And Work Longer Hours To Compensate For Loss Due To Covid-19 Pandemic. 

Ministry of shipping has issued a letter dated  April 21, 2020  regarding relief measures taken to support and rebuild the logistics. Like Storage Charges: Ports shall allow free storage time to all port users for the Lock-down Period.

Union Cabinet approved the promulgation of an Ordinance to amend the Epidemic Diseases Act 1897 to provide stricter punishments for attacks against health workers. The amendment was necessitated in view of reports of incidents of attack and harassment against doctors, nurses, para-medics and Asha workers.

Central government is likely to clear a relief package worth Rs 20,000 crore, which will be divided in two separate funds, to help Micro, Small and Medium Enterprises (MSMEs) restart economic activities. The Expenditure Finance Committee or EFC, headed by finance minister Nirmala Sitaraman has cleared and forwarded two proposals for govt allocating nearly Rs 20,000 crore for helping MSME. 

.

==========>

.

👉🏻Clarifications on provisions of the Direct Tax Vivad se Vishwas Act, 2020

(CBDT has modified answer to question in relation to prosecution cases with a view to "reflect the correct intent of law")

👇🏻 👇🏻 👇🏻

https://bit.ly/2VyHwLf

👉🏻MCA allows companies to hold first AGM before September 30

(allowed companies whose financial year ended in December, to hold their first AGMs within the first nine months of their current fiscal or Sept. 30)

👇🏻 👇🏻 👇🏻

https://bit.ly/3eMqWPh

 

.

==========>

.

CBDT issued Circular No. 9 of 2020 dated April-22-2020 whereby certain replies to 55 FAQs; answered on March-04-2020 have been modified or consequentially amended. With this, Circular No. 7 of 2020 dated March-04-2020 has been Withdrawn.



Central Board of Indirect Taxes and Customs (CBIC) on extended the deadline to import and export goods without furnishing bonds to the Customs authorities by a fortnight till May 15, a move aimed at facilitating trade during the COVID-19 lockdown. In a circular, the CBIC said businesses will, however, have to furnish proper bond to the Customs authorities by May 30 for import and exports done through undertaking till May 15. 

GST: Now use PMT-09 to transfer Balance in Cash Ledger of one head of GST to other i.e. IGST to SGST/CGST etc. Also transfer from tax to interest etc. 

Reserve Bank of India will now get 45 days to deploy money drawn under Targeted Long term Repo Operations 2.0 (TLTRO 2.0) as against the previous limit of 30 days. The extension has been granted based on the feedback received from banks and taking into account the disruptions caused by Covid-19. 

Bombay High Court quashed criminal complaints filed by the Serious Fraud Investigation Office against the erstwhile auditors of Infrastructure Leasing and Financial Services Ltd. and its non-bank lending arm for alleged collusion in falsifying books.

.

==========>

.

👉 State-run NBCC has moved the National Company Law Appellate Tribunal (NCLAT) challenging the March 3 order of the National Company Law Tribunal (NCLT) that approved its resolution plan for debt-laden Jaypee Infratech (JIL). Hearing the NBCC’s ‘urgent’ plea on Wednesday, the two-member NCLAT bench, headed by its acting chairperson justice Bansi Lal Bhat, directed, “Meanwhile, till further orders, the approved ‘resolution plan’ may be implemented subject to outcome of this Appeal.” NCLAT has scheduled the matter for further hearing on May 15.

NBCC’s resolution plan includes handing over close to 21,800 homebuyers their units in phases over a period of three and a half years and paying off financial creditors their entire admitted claim of Rs 9,783 crore.

In its appeal to the NCLAT, NBCC alleged that the tribunal, in its order, made unilateral and arbitrary modifications of its resolution plan by allowing objections raised by dissenting creditor ICICI Bank and Yamuna Expressway Industrial Development Authority (YEIDA) even as the plan was approved by a majority of 97.36% vote in the Committee of Creditors (CoC).

In its appeal to the NCLAT, NBCC said the modifications made in the approved plan were inconsistent with the provision of the Insolvency and Bankruptcy Code (IBC). CoC had approved NBCC’s bid on December 9, 2019.

In its order, NCLT had asked NBCC to pay ICICI Bank its due in cash in 12 equal monthly instalments within 18 months, starting from six months from the approval of the resolution plan. NBCC said such a direction was “arbitrary” and on unreasonable grounds that dissenting financial creditors are entitled to payment in cash under the provisions of the code.

“The NCLT has dealt with the two issues raised by YEIDA against the resolution plan by amending the resolution plan to provide that any additional compensation will have to be paid by the SPVs, and, with respect to the additional compensation in relation to Expressway, parties can approach appropriate forum of law regarding the same,” the state-run firm said in its application.

👉 New Delhi, Apr 22 (PTI) The National Company Law Appellate Tribunal (NCLAT) on Wednesday asked state-owned-NBCC to implement its proposal to acquire debt ridden Jaypee Infratech and complete over 20,000 pending flats, but said the direction is subject to its final order.

The NCLAT''s direction came over an urgent petition moved by the NBCC, which won the bid to acquire Jaypee Infratech. The NBCC''s resolution plan has already been approved by the National Company Law Tribunal (NCLT), but appeals have been filed by the Jaypee Group as well as the NBCC.

The appellate tribunal also directed Jaypee Infratech''s Interim Resolution Professional (IRP) Anuj Jain to constitute an interim monitoring committee, comprising representatives of the NBCC and its three main lenders IDBI Bank, IIFCL and LIC.

While hearing petition during the extended lockdown period, a two-member bench headed by NCLAT Acting Chairperson Justice B L Bhat said the IRP would be part of the interim monitoring committee and continue to be paid.

“Meanwhile, till further orders, the approved resolution plan may be implemented subject to outcome of this appeal,†said the NCLAT.

†The IRP may constitute an interim monitoring committee comprising the successful resolution applicant, i.e., the appellant and the three major institutional financial creditors, who were Members of the ''committee of creditors," it said.

The appellate tribunal issued notices to ICICI Bank, IDBI Bank and others directing them to file reply in two weeks and listed the matter on May 15 for the next hearing.

“List the matter for ‘admission after notice’️ on May 15, 2020,†said the NCLAT.

22 April 2020 News and Updates

Corporate Snippets on April 22

Ø 72% companies to take a Covid hit, 61% to defer expansion: FICCI survey

Ø RBI EMI moratorium could provide liquidity to cos

Ø 'Stress on industry due to Covid-19 to extend beyond Q1'

Ø Voda Idea pays Rs 1,367 cr to Govt. towards licence fee

Ø ICICI Bank confirms exposure to oil trader Hin Leong

Ø Nestle resumes manufacturing at all plants

Ø MCX to extend trading time for non-agri goods

Ø RBI considers standing deposit facility to manage extra liquidity

Ø ACC reports drop of nearly 7% in Q1 consolidated net profit at Rs 323 cr

Ø Oil firms float finished fuel products on Arabian Sea as demand slumps

Ø OMCs, RIL better placed; oil producers stare at losses as crude plunges

Ø SEBI grants breather to firms, extends expiration date for IPO approvals

Ø Ind-Ra rates Mahindra & Mahindra NCDs 'AAA' with stable outlook

Ø Proposed Electricity Act may rework slabs for residential consumers

Ø Oil crash adds new shock to limping world economy

Ø IRDAI allows payment of health cover premium in instalments

Ø MFIs, banks bullish on fast recovery of rural economy post lockdown

Ø Indian PE, VC investments likely to fall 45-60 per cent: EY

Ø Jyothy Labs launches Margo hand sanitiser

Ø Oil crash adds new shock to limping world economy

Ø India’s domestic cooking gas demand spikes in April during lockdown

Ø CII seeks further easing of lockdown, wants more businesses to resume

Ø Investor wealth drops ₹3.30 lakh crore as equity markets tank

Ø Reduced market hours caused fiasco in crude settlement at MCX

Ø Fighting COVID-19: Govt may roll out fiscal package 2.0 today

Ø Time for India to think long-term during Covid-19 crisis, says economist Arvind Panagariya

Ø Coronavirus relief: SEIS sops for services exporters to continue

Ø RBI 3-month EMI moratorium could provide Rs 2.1 lakh cr liquidity to companies

Ø NSE cautions trading members over using video conferencing app Zoom

Ø Nearly 57 per cent of companies to face pandemic's negative impact, survey states

.

===========>

.

👉🏻RBI asks banks to extend all benefits announced by govt pertaining to short-term crop loans to farmers

(RBI asked banks to extend the benefit of interest subvention (IS) and prompt repayment incentive (PRI) for short-term crop loans to farmers till 31st May, 2020)

👇🏻 👇🏻 👇🏻

https://bit.ly/2Vr5V4Z

👉🏻Emails to taxpayers for tax refund should not be misconstrued - CBDT

(CBDT said that its email seeking clarification from all those taxpayers who are entitled to get tax refund but also have outstanding tax to pay should not be misconstrued) 

👇🏻 👇🏻 👇🏻

https://bit.ly/3ezGrdk

.

===========>

.

GST Form PMT-09 is available on Portal: Use of Form GST PMT-09 is for "Transfer of amount from one account head to another in electronic cash ledger".Major Head - IGST/CGST/SGST/Cess Minor Head - Tax/Interest/Late Fee/Penalty/Other Transfer from One Minor Head to Another Minor Head Any amount deposited under wrong head can be transferred to correct head through this Form immediately.

GST Taxpayers can now file GSTR-3B by EVC, without using DSC Read More at: http://www.a2ztaxcorp.com/taxpayers-can-now-file-gstr-3b-by-evc-without-using-dsc/

MCA has issued General Circular No. 18/2020 dated 21st April, 2020  regarding  *Holding of AGMs by companies whose financial year ended on 31st December, 2019. Now these Companies may hold their AGM by 30th September, 2020 instead of 30th June, 2020.

http://www.mca.gov.in/Ministry/pdf/Circular18_21042020.pdf

No A/c can be declare as NPA till 31st May. Bombay high court decision and a RBI circular due to which bank accounts can be saved from being NPA till 31st May 2020.

Insolvency and Bankruptcy Board of India (‘IBBI’) vide its notification dated 17th April, 2020 has brought amendment in the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 by stating that the period of lockdown shall be excluded for the purpose of computation of the time-line for any task that could not be completed due to such lockdown, in relation to the liquidation process.

ICAI has decided to waive off condonation fee on delay filing of all articled/industrial training related application forms till 30th June 2020 if transaction date in such application forms falls between 1st March 2020 to 30th May 2020. This period includes one-month prescribed time limit given in general.

ICAI has issued an advisory for the Bank Branch Auditors for initiating the process of Statutory bank branch audit remotely to ensure timely and effective Bank Audit. The said advisory has been emailed to all the Applicants whose names were appearing in the RBI Bank Branch Audit Panel. Members / CA Firms who have been allotted the Branch Audit of PSBs for the year 2019-2020, may please check their emails

Thanks for reading

21 April 2020 News and Updates

 21st April 2K20

Ø  Non-bank lenders seek to tap unused credit lines

Ø  Conduct money laundering risk assessment: RBI to banks

Ø  Housing finance companies to see slower credit growth in FY21: Report

Ø  Domestic manufacturers to make 1 lakh coveralls a day

Ø  India's FDI rules may open new flashpoint with China

Ø  Sebi extends derivative curbs up to May 28

Ø  Govt to spend Rs 4K-cr more on crop insurance scheme

Ø  Centre permits conversion of surplus rice to ethanol for hand sanitisers

Ø  Crude oil contract expires below Rs 1,000 for the first time ever on MCX

Ø  FinMin sanctions Rs 46,038 cr states' share in central taxes for April

Ø  Mahindra & Mahindra tractor-led portfolio to cushion revenue fall

Ø  Credit profile of Indian power utilities likely to remain steady: Fitch

Ø  Infosys results: Q4 revenue up to ₹23,267 crore, net profit up 6.3 per cent

Ø  China says India's FDI restrictions against WTO rules, G-20 consensus

Ø  BPCL-Kochi Refinery ensures optimised fuel supply

Ø  Covid-19 inflicts a daily loss of ₹224 crore to India’s fishery sector

Ø  Alembic gets USFDA nod for generic ophthalmic solution

Ø  Strides gets USFDA approval for Flucytosine capsules

Ø  Novartis, US drug regulator agree to malaria drug trial against Covid-19

Ø  Zydus explores biologicals route to treat COVID-19 with Interferon alpha-2b

Ø  Aegon Custody sells HDFC Bank shares worth over ₹72 crore

Ø  Grofers to invest $15 million in private labels as demand grows

Ø  Domestic sales of electric vehicles jump 20% in FY20

Ø  India has all rights to protect industry; no WTO violation in FDI decision: Experts

Ø  RBI’s next Monetary Policy Committee meet scheduled for June 3-5; repo rate decision awaited

Ø  CIL raises trigger level to 80%, coaxes power plants to use more domestic fuel

Ø  Insurance regulator IRDAI asks health insurers to settle claims within two hours

Ø  Vijay Mallya loses UK High Court appeal in extradition case

Ø  India's steel demand expected to drop to multi-year lows due to covid lockdown

.

==========>

.

👉🏻ED attaches assets worth Rs.175.29 Cr in bank fraud case

(ED has attached 124 immovable properties worth more than Rs 175 CR of a Company in connection with a money laundering probe linked to an alleged bank fraud case)

👇🏻 👇🏻 👇🏻

https://bit.ly/3cxYpel

👉🏻SEBI extends trading curbs to contain market volatility till May end

(SEBI said the measures aimed at containing the wild swings in stock prices would continue till the end of next month.)

👇🏻 👇🏻 👇🏻

https://bit.ly/2RTr05U

👉🏻Amendments in TDS Provisions by Finance Act 2020 | Changes in TDS Provisions

(Amendments in TDS Provisions by Finance Act 2020 discussed by CA.Saloni Varshney.)

👇🏻 👇🏻 👇🏻

https://bit.ly/2VoMl9F

.

==========>

.

👉🏻 Form PMT - 09 is available on GST portal. 

👉🏻 Now, taxpayer can transfer the cash balance available under one head to another head of tax i.e. from CGST to SGST or interest or penalty or vice versa which means GST deposited under wrong head can be corrected now...👍🏻

.

==========>

.

Delhi High Court has directed for maintenance of status quo with respect to the repayment to be made by Indiabulls Housing Finance to its Non-Convertible Debenture holders. (Indiabulls Housing Finance vs SEBI). The ad interim order was passed by a Single Judge Bench of Justice C Hari Shankar.

Prime Minister’s Office (PMO) has received an urgent call for help from medium and small industries who fear possible hostile takeovers from Chinese investors at a time when they are facing survival issues and their valuations have taken a beating amid the Covid crisis. small-sized industries want the Centre to temporarily halt FDI through automatic route, which is currently possible for over 1,000 industries, with just 16 sectors, including defence and telecom, requiring government scrutiny.

Punjab & Sind Bank said it has declared the non-performing account of Golden Jubilee Hotels, involving an outstanding amount of over Rs 86 crore, as "fraud". It is informed that an NPA account viz Golden Jubilee Hotels Pvt Ltd with book outstanding of Rs 86.40 crore and 100 per cent provisioning has been declared as fraud and reported to the RBI as per regulatory requirement.

High Court denies request for bail in a case of GST evasion to the tune of Rs. 20 crores (approx.) under section 132 of GST Act 2017, in light of the prevelant conditions of spread of COVID-19 virus, in a case of Rajinder Bassi and others vs. State of Punjab dated April 17, 2020. The spirit of directions as issued by Supreme Court vide order dated 23.02.2020 and as clarified vide order dated 13.4.2020

AAR gave an important ruling regarding classification and taxability of Flavoured milk GST @ 12% in case of Tirumala Milk Products (P.) Ltd. [2019] 111 taxmann.com 495 (AAR-ANDHRA PRADESH)

Supreme Court has held that open spaces left for garden areas in approved building layout plans cannot be allowed for construction.

.

==========>

.

👉 The insolvency regulator IBBI has now ruled that the 40-day nationwide lockdown imposed by the Centre in the wake of COVID-19 outbreak will not be counted for the purpose of computation of timeline for any tasks under liquidation process.

It may be recalled that the Insolvency and Bankruptcy Board of India (IBBI) had in end March , announced that the national lockdown period will not be counted for the purpose of timeline of completion of any activity under the Corporate Insolvency Resolution Process (CIRP) regulations.

Describing the latest IBBI move on liquidation regulations as a proactive and positive step, Aditya Nayyar, Partner, Ortis Law Offices said that this amendment is only indicative of the fact that the insolvency regulator/ Government is reacting and implementing the various suggestions being received by it, although in a phased manner.

“The amendment would allow the liquidator to exclude the entire time period of COVID-19 lockdown from all the timelines provided under the liquidation regulations of the IBC, thereby ensuring that unnecessary defaults do not occur in the future. This move would also ensure that the NCLT is not flooded with procedural applications seeking extensions and or con donation of delay in meeting timelines, once the lockdown is relaxed and the NCLT finally reopens and even anytime thereafter, during the liquidation process”, he said.

👉 The Institute of Chartered Accountants of India ( ICAI ) has invited suggestions from CA Members on Draft Valuers Bill, 2020.

The Ministry of Corporate Affairs had constituted an eight-member Committee of Experts to examine the need for an institutional framework and development of valuation professions, under the Chairpersonship of Shri M. S. Sahoo, Chairperson, Insolvency and Bankruptcy Board of India (IBBI) on 30th August 2019 wherein ICAI has also been a member.

Based on comprehensive study and analysis of all relevant issues and taking the inputs of key stakeholders, the Committee has submitted its report to the Government of India on 31st March 2020 along with Draft Valuers Bill, 2020, recommending to establish a National Institute of Valuers.

Considering the above, ICAI invites suggestions/comments from members on various questions framed in this regard by 12.00 Noon on 10th May, 2020.

The Draft Valuers Bill, 2020 is available in the Volume I of the Report of the Committee of Experts.

Thanks for reading

20 April 2020 News and Updates

20th April 2K20

Ø  DGCA bars airlines from booking tickets beyond May 3, 2020

Ø  Lockdown to have huge impact on heavy appliances sector: Godrej

Ø  "SMEs need to be prudent, avoid over-leveraging"

Ø  CBDT revising ITR forms to reflect timeline extension

Ø  Competition Commission cautions businesses against unfair practices amid coronavirus pandemic

Ø  Sebi may scan Cayman, Singapore investment hubs for Chinese links

Ø  SMEs to gain maximum from Rs 1-trn RBI liquidity boost to NBFCs, HFCs

Ø  India could use 3-5% of GDP stabilising economy: World Bank economists

Ø  Govt reverses stance on e-commerce, disallows sale of non-essential items

Ø  Steel demand to contract 7.7% in 2020 over coronavirus crisis: ISA

Ø  Finance Act 2020: Subtle yet significant changes in income-tax rules

Ø  PPP port operators set to invoke force majeure in concession pacts

Ø  TVS Motor buys UK's iconic premium bike brand Norton

Ø  Centre proposes National Renewable Energy Policy

Ø  Covid-19: Lockdown period not to be counted for liquidation process related tasks

Ø  Kotak Mahindra Bank looks to raise ₹8,000 crore via promoter stake sale

Ø  PM Modi urges industry to adopt new business models, work culture

Ø  No tax on provident fund (PF) after five years of service

Ø  Norton acquisition brings TVS Motor face-to-face with Royal Enfield

Ø  Govt transfers Rs 36k crore during lockdown so far in bank accounts of this many beneficiaries

Ø  Kotak Mahindra Bank board to consider fundraising proposal this week

Ø  Govt-backed credit guarantee needed to ensure banks overcome risk averseness while lending: CII

Ø  Moratorium: 10 per cent provisioning may shave Rs 35,000 crore off bank profits

Ø  India will import drugs with less than 60 pc shelf life, condition apply

Ø  FPIs pull out Rs 12,650 cr in April amid covid19 crisis

Ø  Cabinet likely to approve package for power distribution utilities due to low demand

.

==========>

.

👉🏻GST Refund worth Rs. 5575 Cr processed in 15 days

(CBIC on Friday reported settling GST refund claims worth Rs,5,575 Cr in 15 days)

👇🏻 👇🏻 👇🏻

https://bit.ly/2xvknjD

 

👉🏻RBI gives NPA classification reprieve to accounts under 3-month moratorium

(This effectively means that the bad loan classification period changes to 180 days for all such accounts from 90 days)  

👇🏻 👇🏻 👇🏻

https://bit.ly/2Vjkc3V

👉🏻Appointment of Internal Auditors for RailTel

(Internal Audit for its Corporate Office at New Delhi and its Regional offices at Mumbai, Kolkata, Hyderabad and New Delhi) 

👇🏻 👇🏻 👇🏻

https://bit.ly/2RKncUQ

👉🏻Procedure for Registration of Charitable and Religious entities

(Procedure for Registration of Charitable and Religious entities (Trust or Societies) under Income Tax Act as per the Finance Act, 2020 discussed by CA. Vidhu Duggal) 

👇🏻 👇🏻 👇🏻

https://bit.ly/2VRbZ6b

.

==========>

.

👉 State-owned Punjab & Sind Bank on Saturday said it has declared the non-performing account of Golden Jubilee Hotels, involving an outstanding amount of over Rs 86 crore, as "fraud".

"It is informed that an NPA account viz Golden Jubilee Hotels Pvt Ltd with book outstanding of Rs 86.40 crore and 100 per cent provisioning has been declared as fraud and reported to the RBI as per regulatory requirement," it said in a filing to exchanges.

Golden Jubilee Hotels Pvt Ltd is a public-private partnership (PPP) with the Department of Tourism and Youth Advancement, Tourism & Culture, Government of Telangana, according to the hotel's website.

The hotel group was admitted for Corporate Resolution Insolvency Process (CRIP) on February 27, 2018, at the Hyderabad bench of the National Company Law Tribunal (NCLT), by a consortium of eight public sector lenders led by Bank of Baroda.

👉 The government must hold the operation of the Insolvency and Bankruptcy Code (IBC) in abeyance for at least six months, in view of the Covid-19 lockdown and the extraordinary curtailment of business and revenue, and low valuation of assets it has forced. An Ordinance should be issued, to apply this ban on all those eligible to file for insolvency proceedings — financial or operational creditors, and defaulting companies.

Rightly, the government has raised the size of the loan default that can trigger insolvency to a minimum of Rs 1 crore from Rs 1lakh, to help small borrowers.

As a corollary to the forbearance announced earlier of a three-month moratorium by banks on debt service by their borrowers, the Reserve Bank of India (RBI) has now told banks that the moratorium period will not count for classifying aloan as non-performing. This should avert a huge surge in bad loans. Already, the Insolvency and Bankruptcy Board of India (IBBI) has excluded the period of lockdown from the timelines mandated to complete the resolution process. But the resolution of distressed assets needs more time, given that the deteriorating economic condition is also likely to see fewer potential bidders for distressed companies.

.

==========>

.

Outward supplies in FORM GSTR-1 & ITC in GSTR-2A should be linked to FORM GSTR-3B: Nandan Nilekani

https://studycafe.in/2020/03/outward-supplies-in-form-gstr-1-itc-in-gstr-2a-should-be-linked-to-form-gstr-3b-nandan-nilekani.html

.

==========>

.

Physical verification of premises to be done before passing of the ITC in case of new GST registrations

https://studycafe.in/2020/03/physical-verification-of-premises-to-be-done-before-passing-of-the-itc-in-case-of-new-gst-registrations.html

.

==========>

.

SECTION 244A OF THE INCOME-TAX ACT, 1961 - REFUNDS - INTEREST ON

 

Interest on delayed interest : Under section 244A interest on delayed refund becomes part of principal amount and, thus, delayed interest not only includes interest for not refunding principal amount but also interest on delayed refund - Principal Commissioner of Income-tax v. Ambuja Darla Kashlog Mangoo Transport Co-operative Society - [2020] 114 taxmann.com 527 (Himachal Pradesh)

*.

==========>

.

SECTION 14A OF THE INCOME-TAX ACT, 1961 - EXPENDITURE INCURRED IN RELATION TO INCOME NOT INCLUDIBLE IN TOTAL INCOME

 

Recording of satisfaction : Where Assessing Officer rejected suo motu disallowance made by assessee under section 14A without recording any dissatisfaction, Tribunal was justified in holding that rule 8D could not be invoked - Principal Commissioner of Income-tax-14 v. Godrej Investment Ltd. - [2020] 114 taxmann.com 581 (Bombay)

.

==========>

.

👉🏻SEBI seek essential service status for Auditors of listed companies

(SEBI has written to MCA to take up the matter of permitting auditors of listed companies to operate from April 20, 2020 with MHA) 

👇🏻 👇🏻 👇🏻

https://bit.ly/2Vm68Xh

👉🏻CBDT revised return forms for FY 2019-20 to be notified by end of this month

(CBDT has initiated necessary changes in the return forms so that taxpayers could take benefits of their transactions carried out during the COVID period in the return forms)

👇🏻 👇🏻 👇🏻

https://bit.ly/34R1Ytq

👉🏻RBI Circular | Assets Classification and Provisioning | NPA Identifications

(RBI Latest Circular on Assets Classification and Provisioning and Identification of  NPA for Bank Audits discussed by CA. Ashish Gupta.)

👇🏻 👇🏻 👇🏻

https://bit.ly/3cwg8Tt 

.

==========>

.

👉 The Insolvency and Bankruptcy Board of India(IBBI), on Friday, issued  Insolvency and Bankruptcy Board of India (Liquidation Process) (Second Amendment)  Regulations, 2020.

The Insolvency and Bankruptcy Board of India(IBBI) seeks to amend liquidation processregulations by inserting a new regulation 47A into the principal regulations called Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 to exclude the period of lockdown in the liquidation process. For calculating any timeline for any task which could not be completed, the period of lockdown will be excluded.

In the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, after Regulation 47, Regulation 47A shall be inserted, namely, “Exclusion of period of lockdown. Subject to the provisions of the Code, the period of lockdown imposed by the Central Governmentin the wake of COVID-19 outbreak shall not be counted for the purposes of computation of the time-line for any task that could not be completed due to such lockdown, in relation to any liquidation process.”.

👉 Last month, while announcing relief packages for covid-19 pandemic, finance minister Nirmala Sitharaman also announced that the threshold for defaulting companies under the Insolvency and Bankruptcy Code (IBC) has been raised, with immediate effect, to ₹1 crore from ₹1 lakh earlier. Earlier, creditors had the right to file a case under IBC if a company defaulted on payment of ₹1 lakh or above, now this limit has been raised to ₹1 crore

A few months ago, the government made another amendment under IBC introducing a minimum threshold of 100 or 10% of the homebuyers, whichever is lower, to take a defaulting developer to the National Company Law Tribunal (NCLT). We asked experts how these amendments will impact the rights of homebuyers, who are considered as financial creditors under IBC.

 .

==========>

.

CBDT is revising the return forms for FY 2019-20 dated 19.04.2020. To enable benefits of various timeline extensions granted by the Government of India due to Covid-19 pandemic situations, the CBDT is revising the return forms for FY 2019-20 (Assessment Year 2020-21) which shall be notified by the end of this month.

CBDT informed that it has already issued over 10.2 lakh refunds totalling to around Rs. 4,250 crore as on 14th April 2020. These refunds are over and above the 2.50 crore refunds already issued in FY 2019-2020 till 31st March 2020 totalling Rs 1.84 lakh crore. The CBDT further informed that about 1.75 lakh more refunds are in the process of issuance which would get credited directly to the taxpayer bank account in 5-7 business days from issuance.

Central Board of Indirect Taxes and Customs (CBIC) said that it had issued Rs 5,575 crore as refunds since March 30, by processing 12,923 applications. Of this, 7873 application claims worth Rs 3,854 crore have been processed in the last week. 

CBIC has issued Circular No. 19/2020- Customs dated April 13, 2020 for electronic communication of PDF based Gatepass and OOC Copy of Bill of Entry to Custom Brokers/Importers. Board has now decided to enable electronic communication of PDF based Final eOoC (electronic Out of Charge) copy of BoE and eGatepass to the importers/Customs Brokers. This electronic communication would reduce interface between the Customs authorities and the importers/Customs Brokers.

ICAI issues Revised Minimum Recommended Scale of Fees for The Professional Assignments done by professionals

Thanks for reading

18 April 2020 Updates

Government mulls setting up national institute of valuers on the lines of ICAI - The Economic Times https://m.economictimes.com/news/economy/policy/government-mulls-setting-up-national-institute-of-valuers-on-the-lines-of-icai/articleshow/75187112.cms

.

=========>

.

RBI governor announcements

👉Positive Growth in GDP by 1.9% in comparision to any other country of the world.

👉 Kharif Crop Production have increased by 33% in comparison to Last Year. Which is a great Achievement.

👉 IMF Has Projected a Growth rate of 7.4% in 2021-22.

👉 Forex reserve of india is 476Bn $ as on 10th April.

👉 Fresh Currency of 1.4 Lakh Cr has been issued to Banks from Mar to April 12 so that no ATM go Dry

👉 Fresh TLTRO-2.0- For 50K Cr To begin With. Min 50% Of flow should go to small NBFC and FII.

👉 Refinance Facility will be given to - NABARD, SIDBI, NHB- These FI help NBFC. 25K To Nabard, 15K to SIDBI, 10K to NHB. Rate of interest on such loan will be 4.4%

👉 LAF- Liquidity Adjustment Facility- Reverse repo rate reduced by 0.25%.

👉 For NPA Classification Period of 01-03-2020 to 31-05-2020 will be excluded.

👉 Insolvency Resolution which have not been resolved then on all such loan of NPA-20% Additional Provision has to be created.

👉 Distribution of Dividend- NBFC and Banks cannot announce any Further dividend for 31-03-2020 till further order

👉 NBFC Loan to Commercial Realestate Projects- Delay of 1 Yrs extension allowed. And banks will be allowed to do the reschedule the loans accordingly

 .

=========>

.

👉 In the year since Jet Airways operated its last flight former employees and creditors have continued to wait for the payment of their dues, even as rivals have swooped in and acquired the airline’s aircraft and routes.

The airline operated its last flight between Amritsar-Mumbai on April 17, 2019, as lenders turned down its demand for emergency funding. The Naresh Goyal-founded airline, among the first private carriers to take to skies in 1993, collapsed under a mountain of debt and a cash crunch.

It has been under insolvency since June last with admitted claims of Rs 16,000 crore. Now, the coronavirus disease (Covid-19) crisis has dashed any prospects of revival.

Before the nationwide lockdown, the National Company Law Tribunal (NCLT) granted an additional three months to the airline’s resolution professional to find a suitor on the grounds that lenders would get better value for their assets if these were sold via a formal resolution plan, instead of the liquidation route.

👉 The COVID-19 crisis has brought into sharp relief an indiscriminate correlation: saving human lives is important, but ensuring livelihoods is equally significant. As the authorities with support from India Inc go about the challenge of saving lives, the current is one of safeguarding the economy. Business organisations need to remain solvent; jobs need to be saved. As the Indian economy faces an unprecedented crisis on account of the Covid19 pandemic, one of the biggest worries for it is that global investors may take over distressed Indian companies at very low-price points, unless bankruptcy and insolvency laws are temporarily suspended. Global investors are waiting for Indian stocks to fall in value so that they can take over listed companies at throwaway prices. We have seen the first such attempt in the last few days. In order to ensure that Indian companies remain Indian-owned, suspension of the NCLT law for at least six months is imperative to salvage the capital erosion. Exceptional measures are required to thwart one of the deepest recessions recorded across the globe.

The Indian economy looks upon the authorities to follow global trends and help pull industry out of the economic maelstrom by instituting a stimulus package that’s at least 10 per cent of the nation’s gross domestic product (GDP). Salvaging the Indian economy requires an urgent booster dose of nearly $200 billion, which needs to be pumped into the market in a staggered manner, effectively retrieving the business cycle without incurring further economic losses. Across sectors, business organisations are seeking working capital to ensure that the economy doesn’t tank, that they don’t default and saddle banks with NPAs, and consequently result in job losses.

.

=========>

.

👉🏻IBA written to RBI for Audit of Selected Branches for Bank Audit

(IBA suggest that banks be given the discretion to select a minimum of 50 branches or more covering 60 per cent of the credit portfolio of the bank as a whole) 

👇🏻 👇🏻 👇🏻

https://bit.ly/2z4VY4I

👉🏻CBDT issues over 10 lakh refunds worth Rs 4,250 Cr in a week

(CBDT has processed over 10 lakh refunds worth four thousand 250 crore rupees in a week, about 1.75 lakh more refunds are in the process of issuance in this week) 

https://bit.ly/34DbO22

👉🏻TDS Circular on Employee's Salary | Old or New Tax Regime under Income Tax Act

(TDS Circular on Employee's Salary | Old or New Tax Regime under Income Tax Act, 1961 Declaration to be taken from employees by employer  discussed by CA.Shivangi Mittal)

👇🏻 👇🏻 👇🏻

https://bit.ly/3a6tGDK

.

=========>

.

Share application money :

SLP dismissed as withdrawn due to low tax effect against High Court ruling that where assessee had received share application money and produced documents to establish genuineness of parties such as PAN of all creditors along with confirmation, their bank statements showing payment of share application money, merely because those persons had not appeared before Assessing Officer would not negate case of assessee so as to invoke section 68 - CIT v. Orchid Industries (P.) Ltd. - [2020] 116 taxmann.com 113 (SC)

CBIC has launched electronic delivery of gate passes and final bills of entry to customs brokers and importers with an aim to further simplify import clearance process by reducing human interface and help tackle the scourge of Covid-19.

Sebi’s direction to custodians is an immediate reaction to People’s Bank of China (PBOC), the country’s monetary authority, buying a little above 1% in HDFC -- India’s leading non-bank mortgage lender and traditionally considered as one of the blue-chip stocks by most institutional investors.

IRDAI has asked insurers to ensure that they have sufficient capital and liquidity to service the requirements of policyholders. “Indian insurers need to prepare strategies and action plans for business continuity to ensure enhanced protection to the policyholders,” the Insurance Regulatory and Development Authority of India said in a circular.

EPF has extend the deposit date for the month of March 2020,up-to 15 May-2020, Instead of 15th April-2020.

.

=========>

.

.

=========>

.

👉  The lockdown, occasioned by the spread of the novel coronavirus, is causing significant stress for Indian business. Even though the Reserve Bank of India (RBI) has instituted debt moratoriums and finance minister Nirmala Sitharaman has announced a slew of relief packages, one expects a significant spike in the number of bankruptcies. Is India’s Insolvency and Bankruptcy Code (IBC) up to the task of this new normal? While much depends on how things pan out in the next few months, here are some pressing issues:

Insolvency resolution traffic jam: According to Injeti Srinivas, corporate affairs secretary, since the commencement of the IBC and setting up of the National Company Law Tribunal (NCLT), 12,000 cases have been filed. Around 4,500 cases have been settled before resolution, with a settlement amount of almost₹2 trillion. 1,500 cases have been admitted and 6,000 cases are waiting in queue. The covid-19 epidemic will only increase this traffic jam. The pile up of cases needs to be addressed by increasing capacity of the NCLT, and by ensuring that as many cases as possible are settled without going to the IBC.

Changing the locus of the promoter of the corporate debtor: Under section 29A(c) of the IBC, a promoter associated with any account which has been classified as a non-performing asset (NPAs) for a period of one year or more is ineligible to bid for any corporate debtor. It is pertinent to recall that the intent of section 29A is to prevent persons who, by their misconduct or fraudulent motives contributed to the default of the corporate debtor, from “buying back" the corporate debtor from the creditors, potentially at steep discounts.

👉 New Delhi, Apr 15 (PTI) A government-appointed committee of experts has proposed an institutional framework for valuers by way of setting up the National Institute of Valuers.

The panel, headed by IBBI (Insolvency and Bankruptcy Board of India) Chairperson M S Sahoo, has also submitted the ''Draft Valuers Bill, 2020''.

The corporate affairs ministry sought comments on the bill, which has recommended setting up of the institute. The deadline for submitting comments is May 14.

The panel was constituted by the ministry on August 30, 2019 to examine the need for an institutional framework for regulation and development of valuation profession.

"Based on a comprehensive study and analysis of all relevant issues and taking the inputs of key stakeholders, the committee has submitted its report to the Government of India on March 31, 2020 along with Draft Valuers Bill, 2020, recommending to establish a National Institute of Valuers," the ministry said in a release on its website.

According to the committee, there should be enactment of an exclusive statute to provide for the establishment of the institute to protect the interests of users of valuation services in India and to promote the development of, and to regulate the profession of valuers and market for valuation services.

.

=========>

.

👉🏻Electronic documents for clearing imports allowed - CBIC

(Govt has allowed importers and customs brokers to give electronic out of charge copies of bill of entry and eGatepass from April 15)

👇🏻 👇🏻 👇🏻

https://bit.ly/2V8FAbL

👉🏻Revolutionary Section for CA Practitioners | Section 80JJAA | Income Tax Act

(Revolutionary Section for CA Practitioners - Section 80JJAA of the Income Tax Act, 1961 discussed by CA. Vipin Garg)

👇🏻 👇🏻 👇🏻

https://bit.ly/2REDWN5

 

👉🏻More than 5 lakh hacked Zoom accounts up for sale on Dark Web

(Hackers were selling usernames and passwords linked to more than 500,000 Zoom accounts on the Dark Web)

👇🏻 👇🏻 👇🏻

https://bit.ly/3ejDu0B

 

👉🏻Recent Judicial Pronouncements from Business Head | Income Tax Act

(Separate Recent Judicial Pronouncements from Business Head of Income Tax Act 1961 discussed by Adv. Kapil Goel.) 

👇🏻 👇🏻 👇🏻

https://bit.ly/3cpA1vH

.

=========>

.

Employer to deduct TDS at normal rates in FY 20-21 also. Employee can Opt to pay taxes at lower rates without claiming exemptions & deductions in ITR.

TDS: Staff can intimate irreversible option to employer to deduct TDS in FY 20-21 at lower rates u/s 115BAC. Else deduction at normal rates. Circular C1 of 13.4.20.

High Court of Karnataka gave important order dated 24th October, 2019 regarding Detention, seizure and release of goods and conveyances in transit  that Writ not maintainable when orders are appealable in a case of Kesar Farm  v.  Additional Commissioner of Commercial Taxes (Enforcement Bengaluru) [2019] 112 taxmann.com374 (Karnataka)

UPRERA PRESS RELEASE on 14th April 2020, xtension of Validity period for registration of real estate projects in the state by 3 months & QPR till 31st May 2020. 

The Authority decided to extend by three months the date of completion of the projects with the date of completion between 15 March 2020 and 31st December 2020 The revised registration certificate of such projects will be issued separately and send to the concern promoters. (point no. 4.1)

Statutory compliances including QPR: The Authority decided to allow the Promoters to update the QPR of the first quarter of the year 2020 by 31st May 2020 . The date of any other statutory compliances pending at the level of the Promoter has also been extended till 31st May 2020. (point no. 4.5).

Thanks for reading

14 April 2020 Updates

👉🏻Chinese Central Bank picks up 1.75 Cr Shares in HDFC

(The People’s Bank of China purchased 1.75 Cr shares in one of the largest housing finance lenders, HDFC Ltd)  

👇🏻 👇🏻 👇🏻

https://bit.ly/3efn5dm

👉🏻GST on Director Remuneration | AAR's Ruling on Directors Remuneration

(Remuneration paid to directors to attract GST by Rajasthan bench of the AAR in the case of Clay Craft India Pvt Ltd.)

👇🏻 👇🏻 👇🏻

https://bit.ly/39XGLiE

👉🏻GST Registration requirements in case of supply from other States

(GST Registration requirements in case of supply from other States - Karnataka AAR's Ruling in case of Kardex India Solutions (P) Ltd.)

👇🏻 👇🏻 👇🏻

https://bit.ly/2y7XhPO

.

==============>

.

CBDT clarified that an employee making a donation to the PM-CARES fund through the employer can claim income tax deduction under Section 80G on the basis of Form 16 issued by the employer. Form 16 is a certificate issued by employers to employees detailing the tax deducted at sources (TDS). 

CBIC has issued instruction No. 03/2020- Customs dated April 09, 2020 to process all pending Customs refund and drawback claims immediately in order to provide immediate relief to the business entities, specially MSMEs, in these difficult times.

Anti-Profiteering has issued Order No. 04/2019 dated 31st January, 2019 To Dominos Pizza guilty of not passing GST benefit in case of Sh. Kiran Chimirala & Director General Anti-Profiteering (Applicant) Vs. M/s. Jubilant Food Work Ltd. (Respondent).

Anti-Profiteering has issued Order No. 13/2019 dated 01st March, 2019: No profiteering if base price of product remain same after GST rate reduction in case of Kerala State Screening Committee on Anti-profiteering (Applicant) Vs. M/s Velbon Vitrified Tiles Pvt. Ltd (Respondent).

GST revenues for April could be down by 30-40% of the annual monthly collections of around Rs 1 lakh crore in FY20. FMCG firms will ensure the dip isn’t more. Currently collections are just a fifth of normal levels.

.

==============>

.

No tax on EPF withdrawals amid covid-19

Considering the financial stress that many salaried individuals might be facing because of covid-19 pandemic, government allowed special provision for withdrawal from Employees’ Provident Fund (EPF) account on 20 March 2020. Since announcement Employees’ Provident Fund organization (EPFO) has processed about 1.37 lakh claims disbursing an amount of about 2.8 billion. The remittances of the moneys have already started taking place.

Typically, funds withdrawn from EPF account before the completion of five years of continuous service attract tax, except in certain conditions such as a medical emergency or where the employee or the employer wind up their business or for any other reason beyond the control of the employer. However, even in case you decide to withdraw funds from EPF account because of covid-19 pandemic, such withdrawal will be exempt from tax. Here is how much and how you can withdraw the funds.

How much you can withdraw?

You can withdraw up to three months salary (basic pay and dearness allowance) or 75% of the total EPF balance in your account whichever is lower. For instance, if your EPF balance is 3 lakh and your basic pay and dearness allowance is 30,000 per month, you are eligible to withdraw lower of 90,000 (3 months salary) or 2.25 lakh (75% of EPF balance), that means you can withdraw up to 90,000. If you need lower amount you can make a request accordingly.

How to make withdrawal?

If you want to withdraw funds out of your EPF account, first login to your EPF account using your Universal Account Number (UAN) and password. Once you login, go to online services tab and click on “Claim (Form-31,19,10C & 10D)." You will only be able to proceed further and make claim if you have updated Aadhaar number with your EPF account. In case your Aadhaar is updated with EPF account, it will ask you to enter four digits of your bank account for verification. After verification of bank account, click on the option “Proceed For Online Claim". Next is to select the applicable form for withdrawal i.e. Form 31 from the drop down list. If you are withdrawing fund because of the financial hardship due to covid-19, select the purpose as “Outbreak of pandemic (COVID-19)" from the drop down. Now you are required to enter the amount you want to withdraw and upload scanned copy of cheque and enter your address. Click on “Get Aadhaar OTP" to proceed further, enter the OTP received on Aadhaar linked mobile and submit the request. EPFO is claiming to settle the request in the three working days.

.

==============>

.

CBDT issues Circular C1 of 2020 dated 13.04.2020 clarifying the process of exercising of option by a taxpayer with regard to deduction of tax at source if he/she opts for the concessional rates of tax as per section 115BAC of IT Act,1961.

Employee to intimate employer of intention to opt for new concessional rates.Intimation so given will be applicable for the year &can't be modified.However,employee will continue to have the right to exercise such option or continue with earlier scheme at time of filing ITR.

.

==============>

.

Important Decision on Personal Guarantors under IBC:

Whether liability of the personal guarantor stand consequently reduced or extinguished on the secured financial creditor receiving the payments in terms of a Resolution Plan in respect of a company undergoing a process of CIRP under the provisions of the IBC, 2016-Gouri Shankar Jain Vs. Punjab National Bank & Anr. – Calcutta High Court

The decision of the High Court is summarized in following points: 

1. Right to apply for insolvency does not arise out of a contract between the parties.

2. Resolution plan is neither a compromise or composition nor voluntary compromise with the corporate debtor.

3. Section 14 of the Code of 2016 does not apply to a personal guarantor.

4. The existing contracts between the surety, principal debtor and the creditor remains unaffected during the moratorium under Section 14.

5. Principal debtor has gone into liquidation would not have any effect on the liability of the guarantor.

6. Pre insolvency right of the creditor does not undergo any metamorphosis on the principle.

7. When, the creditor is dealing with the principal debtor in terms of the Code of 2016, the consent of the surety is not required.

8. The sanctioned Resolution Plan cannot be construed to be a variation of the terms of the contract between the principal debtor and the creditor.

https://ibclaw.in/whether-liability-of-the-personal-guarantor-stand-consequently-reduced-or-extinguished-on-the-secured-financial-creditor-receiving-the-payments-in-terms-of-a-resolution-plan-in-respect-of-a-company-un/

.

==============>

.

👉  The National Company Law Tribunal (NCLT) Principal Bench, New Delhi (camp at Chennai), has allowed the Tamil Nadu government to temporarily take over Santosh Hospitals in Besant Nagar, which is closed and under liquidation, and utilise its infrastructure for COVID-19 treatment.

In an unprecedented sitting on Sunday, the Bench passed on an order on an application filed by the Greater Chennai Corporation.

“Though it is Sunday, this Bench has taken up the hearing on an urgent basis, since the COVID-19 pandemic has been rattling lives and the economy of the nation,” said B.S.V. Prakash Kumar, acting president of NCLT.

Santhosh Hospitals had filed for voluntary insolvency and is under liquidation now. The possession of the hospital is with Muthoot Fincorp Limited, one of the lenders to the hospital. The other major lender is DCB Bank.

In its application, the Chennai Corporation said the Tamil Nadu government had directed it to search for suitable hospitals to conduct tests and treat people diagnosed with COVID-19. It identified Santosh Hospitals for the purpose.

The hospital has sufficient beds and infrastructure to conduct tests and offer treatment, it said.

“The Greater Chennai Corporation can take over the hospital on an ‘as is where basis’, without any further liability/expenditure on the part of the liquidator, including charges such as electricity, water usage, cleaning, sanitation and repair and maintenance, among others,” the NCLT said.

👉 Amid prevalent chaos and uncertainty over access to the essential services and commodities during the lockdown, we bring you the latest updates from Chennai.

* The National Company Law Tribunal (NCLT) on Sunday permitted Greater Chennai Corporation to take over a 100-bed defunct private super specialty hospital in Besant Nagar and use it for treating Covid-19 patients.

* Amid daily reports of cops and the public clashing over lockdown violations comes this case of policemen on patrol playing good samaritans and rushing a pregnant woman to hospital on Saturday night.

* 9:25am Covid-19 death toll rises to 308 in India, cases climb to 9,152, reports PTI quoting Union health ministry

* Even as the state government maintained that an IndiGo airlines employee, who died at Rajiv Gandhi Government General Hospital a day before, is not a Covid-19 patient, the body was buried as per the protocol reserved for people who die with novel coronavirus infection. Health department authorities are looking to track people who might have come into contact with the patient.

👉  A decision was recently rendered by a rare sitting of a five-member bench of the National Company Law Appellate Tribunal (NCLAT) in the matter of V Padmakumar v. Stressed Assets Stabilisation Fund (SASF) & Anr.

One of the ancillary issues which came to be considered was whether reflection of debt in the books of accounts tantamounts to acknowledgment of debt under Section 18 of the Limitation Act, 1963, and thereby extends the period of limitation.

The decision was not a unanimous one – it was a majority decision of 4:1. The majority concluded that the filing of balance sheet being mandatory under the Companies Act, 2013, it cannot be treated to be an acknowledgement under Section 18.

The dissent concludes that the recording of debt will be valid acknowledgment under Section 18. With respect, the author through this article, has attempted to conclude that it is in fact the dissent that is correct and should hold the field.

👉 in December 2019, the National Company Law Tribunal (NCLT) in the matter of Sun Pharmaceutical Industries held that the Companies Act, 2013 (act), read with the Foreign Exchange Management (Cross Border Merger) Regulations, 2018 (regulations), do not permit cross-border demergers.

Sun Pharma wished to restructure by consolidating the holding structure of its overseas group companies and demerging two vertical units into separate overseas companies situated in the Netherlands and the US. In accordance with sections 230-232 of the act, which detail the procedure for undertaking any scheme of merger or amalgamation, the company sought approval from its shareholders, creditors and statutory authorities such as the Registrar of Companies, the Reserve Bank of India (RBI), the Securities and Exchange Board of India and the income tax authorities.

No observations were received from any statutory authority apart from the registrar, who argued that section 234 refers only to cross-border mergers and amalgamations and does not cover demergers. Sun Pharma replied that section 234 applied to a scheme of amalgamation whether by way of merger or demerger. The RBI had indicated that they were not inclined to vet the proposed scheme on an individual basis and the NCLT considered this to be a deemed approval as all conditions under the regulations were satisfied.

.

==============>

.

Indian entities of many multinationals, which receive a fixed margin or a mark-up from their parents, fear they could face transfer-pricing issues due to Covid-19. This is because the MNCs are renegotiating and slashing these fixed mark-ups, which the tax authorities may see as an anomaly and question.

GST AAR gave an important ruling dated 15thOctober,2019 regarding supply under contract for ‘design, realization, integration and commissioning of 1.2m Trisonic wind tunnel is a Work Contact in case of Tata Projects Ltd. [2019] 110 taxmann.com 512 (AAR-KERALA)

MCA Clarification on passing of ordinary and special resolutions by companies under the Companies Act, 2013 and rules made thereunder on account of the threat posed by Covid-19.

http://www.mca.gov.in/Ministry/pdf/Circular17_13042020.pdf

MCA Filings under section 124 and section 125 of the Companies Act 2013 r/w IEPFA (Accounting, Audit, Transfer and Refund) Rules 2016 in view of emerging situation due to outbreak of COVID– 19.

http://www.mca.gov.in/Ministry/pdf/Circular16_13042020.pdf

MCA has clarified that companies cannot make financial contributions to any ‘Chief Minister’s Relief Fund’ or ‘State Relief Fund for COVID-19′ and claim that as ‘corporate social responsibility’ (CSR) spending as per existing law. It said all corporate donations to Modi’s ‘PM CARES Fund’, which was set up to fight the COVID-19 pandemic, could be counted as CSR expenditure that most companies are mandated to make by law.

Thanks for reading

12 April 2020 Updates

ITAT Dejhi in the case of Aricent Technologies Holdings Ltd vs. ACIT  Decided that where the deductor has deducted tax at source but has not deposited the tax with the Govt, the assessee cannot be made to suffer. U/s 205, the assessee/ deductee cannot be called upon to pay the tax. Credit for the tax deducted at source has to be allowed in the hands of the deductee irrespective of whether the same has been deposited by the deductor to the credit of the Central Government or not. 

CBDT issues order to mitigate hardship arising due to Compliance of TDS/TCS Provisions vide Press Release dated April 04, 2020 issued order U/s 119 of the act to mitigate hardships to taxpayers arising out of compliance of TDS/TCS .

High Court of Kerala gave an important judgment regarding filing of Form GSTR TRAN-1 electronically or manually and department has to accept it. in case of Leo Distributors V. Commissioner of State GST [2020] 114 taxmann.com 28 (Kerala)

Government has exempt Custom duty and health chess on the import of ventilators, face masks & surgical masks, PPEs and covid test kits. This was done considering the escalating demand for medical goods as India enters a crucial phase in its covid-fight.

Reserve Bank expects the value of the domestic currency to hover around Rs 75 to a dollar and Indian crude basket to about USD 35 per barrel during 2020-21. The rupee came under intensified and sustained depreciation pressures from mid-January, reflecting a generalised weakening of emerging market currencies amid flights to safety, RBI said in its Monetary Policy Report. 

.

============>

.

Brief  from Deepak Parekh’s ( HDFC Chairman Webinar 

Current Scenario-Analysis & Business Response

1. Conserve, Cash at all Costs, you will need it for unforeseen circumstances, including another lock down

2. Make Team A & B. Team A studies prepares current response, and Team B works on situation after two years.

3. You will have to increase wages for some workers to incentivize them to come back. Getting people back will be a problem

4. Travel sector will be hit for a very long time. 2 years plus.

5. 9 Months of this year will be gone in recovery in normalcy in terms of Operations coming back

to normal. If there is no other pandemic.

6. Cut Costs, Reduce Salaries, Prune Manpower if needed.

7. Increase equity in the company. Better to be over capitalized is better than to be over leveraged.

Being Over leveraged will be a disaster, avoid the debt trap at all costs. Give a discount, let investors make money. Get Private Equity. Singapore Airlines is doing a Rights issue as we speak.

8. Micro finance will be worst hit, amongst NBFCs.

9. Build relationship and trust with the banks. Don’t move relationships for a quarter or half a

percent.

10. Await announcement for MSME. More incentives and support expected.

11. Real Estate: Land is a state subject, Real Estate Prices will come down by 20% at least.

Developers who have bought land at high prices will to take a hit on the projects. Many companies will go bankrupt. MCHI – Credai must talk to the Govt for a one time restructuring like in 2008. It will take 8-9 months for things to normalize for Real Estate.

12. Payments from Govt is a big issue. Lot of litigation

Macroeconomic Factors & Risks, 

Long term Outlook:

1. Govt has agreed to increase Fiscal Deficit which is a good sign. State Govts getting Overdraft facilities from Central Government.

2. Consumer Credit is 13% as a percentage of GDP, where as China is 40% and USA 80%

3. Mortgage to GDP, India: 10%, China: 26%, Thailand 20%, Scandinavia: 90% USA: 70%. India

needs to reach the 12-15% mark in the coming couple of years.

4. Yes Bank on Path on recovery, Should have taken part in a similar manner for ILFS and Jet

Airways.

5. USA 10 year paper is 0.77%, India is 6%. India is at a BBB (Lowest Investment Grade). If we

get graded down we will become a Junk Bond .This will crash the economy. This is also why it

will be difficult to print money.

6. Interest rates will go down further, but Banks must pass it on to the company. RBI lends only to

the Banks in India and Banks are concerned more about their own Balance Sheet than national

interest. RBI must start buying Company Bonds.

7. Middle-East will be in a big trouble. Oil will not go back to 60-70. Oil will be at 40-50.

8. Expect more deglobalization. European countries have already made it mandatory for Govt

approval for all acquisition, as companies are available cheap and there is a fear that China may

look to take over companies in Europe.

9. Rupee will be under pressure. Look at a minimum 3% depreciation YoY of the rupee even in the

best times. We are doing much better at the moment with 10% depreciation (Many are at 25%). Trouble will ensue only if our rating goes to Junk. Our Rating unfortunately has not gone up even in our Best Years of 8% growth. However, Companies are getting good borrowing rates. Exports will have to grow for India to do better. Expect a package for Export soon from the Government.

10. By 2023 390 million people will come into the middle class. Hence investment will come. Only 2% of Indians are invested in Equity. Equity investors will increase. India Mutual fund to GDP

ratio is 12% where as in Mexico etc. are 60% plus and USA 100%. India needs to move to 20%.

Rising middle class will lead to more investments in Real Estate and Equity in the long term.

11. Savings rate in India is 17% (Earlier 30%). 10% out of that is in Real Estate or Golds etc. Liquid Savings rate is 7%. People in India are getting used to consumption in India. So there is no

stress there. Hopeful that consumption will increase.

12. EPFO should be allowed to invest in equity. They invested in IL&FS and made a loss. So it is

more conservative.

13. There is a medicine (Cure) which is under testing in the USA, which hopefully should be out in

the market by June end if FDA approves. Vaccine (preventive) will take time.

.

============>

.

COVID-19 pandemic will unleash worst recession since Great Depression: IMF. The outbreak of Covid 19 has diminished the wealth of India's Richest man by 28%. With the collapse of global markets, analysts have been speculating the repercussions of Covid 19 over the business valuations. 

This documents tries to focus on the *impacts on business valuations* and the considerations to be kept in mind while valuing..

.

============>

.

👉🏻Extension of mandatory minimum deposit in PPF, Sukanya Samriddhi Account

(Fin Min extends deadline for mandatory minimum deposit in PPF, Sukanya Samriddhi Account till June 30)

👇🏻 👇🏻 👇🏻

https://bit.ly/3beg0YR

👉🏻Scheduled Banks’ Statement of Position in India as on Friday, March 27, 2020

(RBI issued Press release regarding Scheduled Banks’ Statement of Position in India as on March 27, 2020) 

👇🏻 👇🏻 👇🏻

https://bit.ly/2yU9TdP

👉🏻Bank Audit under CBS | NPA Identification | Bank Branch Audit

Bank Audit under CBS Environments - Identification of NPA under CBS and Finacle,  BaNCS Commands discussed by CA. Kuntal P Shah

👇🏻 👇🏻 👇🏻

https://bit.ly/2V2VYuk

.

============>

.

Ministry of Corporate Affairs

MCA allows  companies to hold Extraordinary General Meetings (EGMs) through VC or OAVM complemented with e-Voting facility/simplified voting through registered emails

Posted Date:- Apr 08, 2020

The Ministry of Corporate Affairs (MCA) is fully cognizant of the difficulties faced by companies on account of the ongoing nation-wide lockdown and social distancing due to COVID 19. The Ministry has also taken note of various representations received from industry associations and corporates on the need to facilitate companies in taking certain emergent/ urgent measures in the face of extreme disruptions and dislocation caused by the pandemic.

Taking stock of the situation, the MCA had earlier allowed all meetings of the Board of directors upto 30th June 2020, to be conducted through Video Conferencing (VC) or other audio visual means (OAVM) vide its notification date 19.03.2020, including meetings on items where the physical presence of directors is otherwise required.

In furtherance of the Government’s objective of facilitating corporate compliances during the current lockdown period and other restrictions on account of COVID 19, the Ministry has today issued a circular allowing companies to hold Extraordinary General Meetings (EGMs) through VC or OAVM complemented with e-Voting facility/simplified voting through registered emails, without requiring the shareholders to physically assemble at a common venue. The Companies Act, 2013 allows ordinary and special resolutions to be passed through postal ballot/e-voting route without holding a physical general meeting. However, in present lockdown/social distancing conditions due to COVID 19, postal ballot facility cannot be utilized by the companies.

Accordingly, the General Circular No. 14/2020 dated 08.04.2020 issued by the MCA allows listed companies or companies with 1,000 shareholders or more which are required to provide e-voting facility under the Companies Act, 2013 to conduct EGM through VC/ OAVM and e-Voting.  For other companies, a highly simplified  mechanism for voting through registered emails has been put in place for easy compliance.

The framework leverages the strengths of digital India by using a combination of VC and e-Voting/simplified voting through registered emails to enable companies conduct their EGMs. As the meetings will be conducted over VC/ OAVM, the facility for appointment of proxies has been dispensed with, while representatives of bodies corporate will continue to get appointed for participation in such meetings.

 This framework allows the companies to hold shareholders’ EGMs through VC/ OAVM without compromising on the other requirements of law. As an additional check, all companies using this option are required to maintain a recorded transcript of the entire proceedings in safe custody, and public companies are also required to host this transcript on their website for greater transparency. Further, all resolutions passed through this framework will be required to filed with the RoC within 60 days, so that such resolutions may be viewed publicly. Other safeguards have also been included in the Circular to ensure transparency, accountability and protection of interests of investors.

 The Ministry’s circular dated 08 April 2020 is available at  http://www.mca.gov.in/Ministry/pdf/Circular14_08042020.pdf

 

.

============>

.

ICAI UPDATES - 12.04.2020

SPECIAL ADDRESS BY ICAI PRESIDENT CA ATUL GUPTAJI

🎈ICAI is working to provide reverification result within 7 Days

🎈ICAI to reduce the time taken to announce result by 15 Days

100% Machine Checking of Papers by 2024

🎈ICAI is creating a Case Study of Question Bank of 5000 Case Studies. 

 🎈Council has approved the Virtual/Online Classes for Post Qualification Courses 

🎈CDS Portal will be started immediately after Lockdown

 

🎈ICAI will come out with Research Paper on Revival of Economy post COVID-19 

🎈Guidelines might be issued for Digital Signing of Audit Reports due to Covid 19

🎈ICAI looking for Case Study Developer

🎈 ICAI will promote work from home culture for women members

🎈No reduction in Job Opportunities for CA's due to COVID-19

🎈Correction window might be reopened only for change of center and not group 

🎈No extension of Last Attempt of Old Syllabus of IPCC/FINAL

🎈No postponement/preponement of June 2020 attempt

🎈Level of Examination of June 2020 exam will be same, Exam Postponement Will Not Make Exam Harder 

🎈ICAI - MTP will Be Commence After 1st May

🎈Lockdown period will not be treated as Holidays for Articles and considered as working but those who are on leaves for examination it will not be considered as working

🎈Earmarked 100 crore for Student Scholarship

🎈No exemption for CS from CA Articleship

🎈 Council will come online every month to answer queries

.

============>

.

👉🏻CBDT clarifies on issue of certificates for collection of TDS, TCS

(CBT provided clarification on orders under Section 119 of the Income-Tax Act issued relating to the issue of certificates for lower deduction/collection of TDS/TCS) 

👇🏻 👇🏻 👇🏻

https://bit.ly/3aTVrk2

👉🏻Minimum CRS score drops to 464 in Express Entry draw for CANADA PR

(This rare second draw within the same day saw the lowest minimum CRS score requirement since October 2019) 

👇🏻 👇🏻 👇🏻

https://bit.ly/2RrtjNI

*👉🏻Penalty for False Entry or Omission of any entry*

(Dangerous Provision under Finance Act, 2020, Every Professional should watch it regarding section 271AAD of the Income Tax Act)

👇🏻 👇🏻 👇🏻

https://bit.ly/39VsIKw 

.

============>

.

Income Tax Department, on its official Twitter handle, announced that it will issue all pending income tax refunds up to Rs 5 lakh immediately to individuals and business entities. 

refunds, customs refunds, and IT will soon be credited into your accounts as the government has decided to provide immediate tax relief to about 1 lakh businesses and 14 lakh taxpayers. With this, the ministry of finance will provide a total tax refund to the tune of Rs 18000 crore. 

Maharashtra AAR gave an important ruling dated 22 January 2020, where applicant is  a receiver of supply of services from VFS Global in case of Municipal Corporation of Greater Mumbai [2020] 114 taxmann.com 238 (AAR - MAHARASHTRA)

GST: Concessional Interest for late filing of 3B & Waiver of Late Fee for GSTR-1 & 3B applies only if filed by specified dates. Noti 31/32/33 of 3.4.20.

CBIC Vide press note dated 09-04-2020 decided to exempt BCD and Health cess on the import of 

Ventilators, Face masks, surgical masks, Personal protection equipment , Covid 19 test kits Inputs for the manufacture of the above items Till 30th Sep 2020. 

Sebi has relaxed its guidelines for foreign portfolio investors (FPIs) seeking a Category-I licence, a move seen giving a boost to overseas investment in stocks. Investors from countries which are not Financial Action Task Force (FATF) members can still qualify for such registrations if the countries are specified by the Indian government.

.

============>

.

GST Department have no jurisdiction to raise demands for the period prior to take over date after the resolution plan was finalized & approved-Ultra Tech Nathdwara Cement Ltd. Vs. Union of India-Rajasthan High Court

Hon'ble Rajasthan High Court held that it cannot be gainsaid that the controversy at hand hours around the simple issue as to whether the resolution plan approved by the COC is binding on the department or not. In this regard, it is trite to note that as per the amended Section 31 of the IBC, the Central Govt., State Govt. or any other local authority to whom, a debt in respect of payment of dues arising under any law for the time being in force are owed, have been brought under the umbrella of the resolution plan approved by the adjudicating officer which has been made binding on such governments and local authorities. The purpose of the IBC is salutary as it has been enacted to ensure that an industry under distress does not fade into oblivion and can be revived by virtue of the resolution plan. Once the offer of the resolution applicant is accepted and the resolution plan is approved by the appropriate authority, the same is binding on all concerned to whom the industry concern may be having statutory dues. No right of audience is given in the resolution proceedings to the operational creditors viz. the Central Govt. or the State Govt. as the case may be.

Subscribe Newsletter:

https://ibclaw.in/subscribe-newsletters/

.

============>

.

👉  The National Company Law Appellate Tribunal, vide judgment dated 12.03.2020, has set aside the Competition Commission of India (“CCI/Commission”) order dated 14.07.2016 imposing a fine of INR 1 crore on M/s Eli Lilly and Company (“Eli”) for gun jumping i.e. for not notifying its acquisition of Novartis Animal Health in India (“NAH”) within the prescribed limit.

Eli- a company based in the United States agreed to acquire the global animal health business of Novartis AG pursuant to a Stock and Asset Purchase Agreement (“SAPA”) dated 22.04.2014 covering the global portion of the transaction. The transaction was publicly announced and notified under the merger control laws in several jurisdictions around the world including the United States and the European Union and the transaction was cleared in each jurisdiction and closed on 01.01.2015.

With respect to India, the acquisition of NAH was handled separately by a separate Slump Sale Agreement dated 03.12.2014 between the parties Indian subsidiaries. The transaction was notified to the Indian Foreign Investment Promotion Board (“FIBP”) on 10.11.2014. However, the transaction was not notified to the CCI as the parties believed it to be covered under the then applicable de Minimis Exemption which applied to acquisitions of enterprises whose sales in India were not more than INR 750 Crores or whose Indian assets valued not more than INR 250 Crores.

👉 By a recent judgment dated 04.03.2020, the Hon’ble National Company Appellate Tribunal (“NCLAT”) has set aside the order dated 06.11.2018 passed by the Competition Commission of India (“CCI”) dismissing allegations of Abuse of Dominant Position by Flipkart India Pvt. Ltd and Flipkart Internet Pvt. Ltd.

The information before the CCI was filed by All India Online Vendors Association (“AIOVA/informant”) which is a group of more than 2000 sellers selling on e-commerce marketplace such as Flipkart, Amazon, and Snapdeal etc. The primary allegation was that Flipkart India sells goods to companies like WS Retail Services Private Limited (“WS Retail Service”), which was owned by the founders of Flipkart Internet Pvt Ltd.( FlipKart Internet) till 2012, at a discounted price and thereafter, these goods are sold on the platform operated by Flipkart Internet. As per the informant, this practice amounted to preferential treatment to certain sellers. In other words, the information revealed an alleged strategy of Flipkart India to acquire goods from various persons and to immediately sell them to WS Retail Services at a discount, which would, in turn, sell these goods as sellers on the internet platform Flipkart.com of Flipkart internet  was anti-competitive and forecloses markets for online sale of the goods by members of AIOVA.

The CCI in its order held that Flipkart is not in a dominant position in the relevant market due to the presence of Amazon (its closest competitor having a valuation around $700 billion) and other competitors such as Paytm Mall, SnapDeal, and Shopclues etc. In addition, new entrants such as Paytm Mall revealed the low entry barriers in the relevant market and ,therefore , no case of abuse of dominant position was made out against FlipKart. AIOVA challenged this CCI order dated 6.11.2018 (prima facie order) in appeal before NCLAT.

.

============>

.

The MCA vide General Circular no 15/2020 dated 10th April 2020 has issued the following Clarifications in respect of CSR during COVID 19 pandemic

1. Contributions made to the PM Cares Fund shall qualify as CSR expenditure 

2. Contributions made to the Chief Ministers Relief Fund or State Relief Fund shall not qualify as CSR expenditure

3. Contributions made to the State Disaster Management Authority to combat COVID 19 shall qualify as CSR expenditure 

4. Expenditure towards COVID 19 related activities including preventive health care and sanitation shall qualify as CSR expenditure 

5. Payment of salary, wages to employees and workers including contractual workers during lockdown shall not qualify as CSR expenditure 

6. Payment of wages to temporary, casual, daily wage workers during lockdown shall not qualify as CSR expenditure 

7. Payment of Ex gratia to temporary or casual or daily wage workers during lockdown shall qualify as CSR expenditure.

.

============>

.

👉🏻Banks ask customers to be cautious against frauds

(The cyber criminals pretending as officials of banks have been reaching out to borrowers, offering them assistance to avail the loan repayment moratorium scheme for phishing out account details)

👇🏻 👇🏻 👇🏻

https://bit.ly/2Ru3k8l

👉🏻Ministry of Labour notifies provident fund contribution scheme

(Govt will grant relief in form of credit of EPF & EPS contributions (24% of wages) for three months in UANs of contributory EPF members)

👇🏻 👇🏻 👇🏻

https://bit.ly/2XsFL3i

👉🏻MCA issued COVID-19 related FAQs on CSR

(MCA issued a set of FAQs along with clarifications are provided below for better understanding of the stakeholders) 

👇🏻 👇🏻 👇🏻

https://bit.ly/3b1OJbQ

.

============>

.

👉  New Delhi, Apr 10 (PTI) The National Company Law Tribunal (NCLT), which at present is hearing only urgent matters through video conferencing, has directed litigants to file "joint memos" of written submissions to save time and ensure rapid disposal amid the Covid-19 pandemic.

The tribunal has asked both sides -- applicants and respondents -- to jointly draft memos, containing points for determination as mutually decided by the parties.

The effort is aimed at making the the process expedient to understand the issues through virtual hearings and dispense justice without any delay.

"This joint memo shall, after having signed by both the parties and the counsel, be filed one day before the date of hearing or at least six hours before hearing," said a notice issued by NCLT registrar dated April 7.

According to the NCLT, this "procedure will avoid delays, avoid filing reply and rejoinder and this memo will be user friendly to arrive to decisions quickly".

This would be applicable for all company-related matters and insolvency proceedings going before the tribunal.

According to the notice, the applicants shall brief facts, mention the supporting material papers while narrating facts in five to ten lines and the reliefs thereto and serve the same upon the opposite party along with its application.

👉 Lenders to Jet Airways are gearing up to liquidate the airline as they are losing all hope of finding a new owner for it given the massive stress in the global aviation sector due to the travel restrictions imposed across the globe following the Covid-19 epidemic.

While the lenders had taken 90 more days to find a buyer under the NCLT-led insolvency process before the epidemic broke out, banking sources said it would now be impossible to get a bider at a time when the aviation sector’s outlook is gloomy.

“It (Jet) may head for liquidation. Even those who have evinced interest are likely to back out due to the adverse impact of the Covid-19 pandemic on the global aviation industry. Existing airlines themselves are finding it difficult to survive. So, taking over a sick company will be all the more difficult,” said a source close to the development. NCLT has given three months’ time from March 15 for revival of the defunct airline through a fresh invitation for expression of interest (EOI).

“With the global aviation industry reeling under the pandemic, it is unlikely that new bidders will show interest. Lenders’ total exposure to the airline is ₹7,227 crore,” said the source.

Prudent ARC, Synergy Group and a consortium of the Russian government-backed Far East Development Fund, in partnership with Enso Group, had earlier submitted their EOI. But none of them submitted a financial bid before the deadline expired on March 9.

“While we were in an advanced stage of going forward and formulating our plan, the Covid-19 situation erupted, so we are now waiting and watching the situation,” Pradeep Goel, Chairman and Managing Director, Prudent ARC, told BusinessLine. According to Goel, the aviation, hospitality, and F&B industries are going to take a serious hit. “We have to evaluate it before we take any steps further because one wrong move will land us into a huge ditch and crores of losses. It will be a very critical decision,” he said.

Thanks for reading