NEWS WRAP - AUGUST 31, 2013

• McDonald's India says Vikram Bakshi no longer Managing Director of JV.

• TCS can become India's second Company to reach $100 billion in Market Cap: CLSA.

• Nokia Corp. is in talks with automakers such as India's Tata group, Volkswagen, Mercedes benz and Renault to install its navigable maps in their cars in India.

• Former Jindal hand, Sushil Maroo, appointed Essar Energy CEO.

• Land Acquisition Bill may push up Property prices by 30%.

• Steel major Jindal Steel & Power Limited (JSPL) faces Charges of selling Captive Coal to third parties.

• Sarraf to succeed Vasudeva as ONGC Chairman in March 2014.

• JSPL Board approves Rs. 1,000 crore Share Buy Back.

Source: Economic Times

MAHINDRA-CIE CONGLOMERATION DEAL, 2013

FACTS

• On 12th July, 2013 the Competition Commission of India (CCI) received a Notice relating to a proposed Combination under section 6(2) of the Competition Act, 2002 by CIE Group Companies and the Mahindra Group Companies.

• Mahindra & Mahindra (M&M) and CIE Group had entered into various Agreements on June 15, 2013 following which they had approached CCI for its Approval.

• As per the deal, CIE would consolidate its European Forgings Businesses with Mahindra Systech firms that comprises of Mahindra Forgings, Mahindra Composites, Mahindra Castings, Mahindra Investments, Mahindra Gears International and MUSCO, into one entity - Mahindra CIE Automotive Limited constituting a series of steps such as Acquisition of Stake in  Mahindra Forgings, Mahindra Composites and Mahindra  Castings by a CIE's Paticipaciones Internacionales Autometal (PIA).

• CIE Group had no presence in the Auto-Component Business in India as well as no Investments in Indian Firms involved in Auto-Component Businesses.

• After the Implementation of deal -

1. M&M would continue to be present as a Shareholder of Mahindra CIE with a Holding of 20.04 percent.
2. The Technologies currently being used by the Mahindra Systech firms would continue to be utilized.

APPROVAL BY CCI

CCI observed that the deal did not contemplate combination of two existing players in the Indian Auto Component manufacturing Business and will not have adverse effect on Competition. Hence, it has given its Approval to Conlomerate Mahindra & Mahindra Group's (M&M) proposed deal with Spain's Auto-Component Maker CIE Group.

LAW LEXICON - The Law Dictionary

• Actore incumbit onus probandi: The burden of proof lies on the plaintiff or the complainant

• Ferae naturae: Dangerous by nature

• Actus reus: Wrongful Act

• Sine Qua Non: An indispensable condition

• Vis Major: Act of God

NEWS WRAP - AUGUST 30, 2013

• Fresh trouble for FT; Group Firm IBMA found to be trading on MCX against Government rules, FMC seeks trade and exposure details.

• Hit by RBI's new rules on Gold Import, Gitanjali Gems seeks Rs. 1000 crore additional loan from banks.

• Cambay Hotels, owned by Neesa Group launched 'Cambay Gir Resort' in Sasan Gir; offers immaculate services.

• Government to allow 100% Equity by Private Companies in Ahmedabad, Chennai, Kolkata, Jaipur Lucknow and Guwahati Airports for a period of 30 years.

• Government to buy Gold from citizens and divert it to Precious Metal Refiners; a radical plan to Curb Imports and Ease Rupee Crisis.

Source: Economic Times

NEWS WRAP - AUGUST 29, 2013

• Ashok Vemuri, Infosys Board Member and Head of American operations, resigns; to join iGate as CEO.

• Land Acquisition Bill set to be moved in Lok Sabha today.

• Patni Brothers - Arihant and Amit through their venture Hive Technologies to set up Data Analytic startups in India; to be modelled on a similar US based initiative.

• Aircel ties up Rs. 8000 crore loans to refinance existing debt.

• India's first UK-listed Feeder Fund likely to raise $ 2-3 billion by September, to be ploughed into Infrastructure Debt Funds (IDFs).

• Amidst falling Rupee against Dollar, Wipro, Tech Mahindra and HCL Tech earn highest returns.

• ECIL website hacked, documents involving ISRO, BARC and Tata Servers leaked online.

• With Agrochemical Patents expiring in 2020, Global Agrochemical companies eye India deals.

• SIDBI, Franchise India join hands for Franchisee Business Loan.

• Indian Overseas Bank seeks Rs. 2100 crore from Government to enhance capital base.

• Tata International ties up with Mumbai based Baron Leather to produce upholstery products.

• US Court to limit Apple Antitrust penalty to e-books.

Source: Economic Times

ZENITH INFOTECH FUND DIVERSION CASE, SEBI'S ORDER SET ASIDE

THE SECURITIES APPELLATE TRIBUNAL, on July 23, 2013 set aside SEBI's ad-interim ex-parte order dated March 25, 2013 against Zenith Infotech Limited (ZIL) & Ors. for fresh consideration.

SEBI in its order dated March 25, 2013 restrained the promoters of ZIL from accessing the Securities Market and directed the Board of Directors to furnish a Bank Guarantee in favor of SEBI within 30 days for an amount of $33.93 million allegedly diverted for uses other than repayment of FCCBs.

BRIEF FACTS OF THE CASE:

• ZIL FLOATED FCCBs of USD 33 million in September 2006 and additional USD 50 million in August, 2007. The amount so collected was due for redemption in August 2011 and August 2012 respectively. However, due to inadequate funds for redemption, the company decided to raise money upto Rs. 1500 crore by sale of one of its businesses 'MSD Business' by obtaining shareholders approval  which was completed in October 2011.
• LAPSE OF CUT-OFF DATE September 21, 2011 led the Trustees of the FCCBs to issue a 'Notice of Default' for maturity of the FCCBs issued in 2011 coupled with a 'Cross Default Notice' for the FCCBs issued in 2012. The Trustees demanded payment of both FCCBs issued in 2011 and 2012 upon which the Appellants contended that they did not have adequate liquid funds to redeem all the FCCBs at one go. Moreover, the maturity date of 2012 FCCBs could not be accelerated without prior approval of RBI.
• UPON FAILURE OF NEGOTIATIONS with investors for extension of time of repayment, the Appellant No.1 ZIL informed BSE on October 13, 2011 of its default on FCCBs due in September 21, 2011.
• SHAREHOLDERS FILED SUIT: On October 14, 2011 certain shareholders claiming to be FCCB Holders filed Suit No. 2034 of 2011 before Civil Court to stop the sale of the MSD Business and also approached SEBI for the same. On the other hand, Trustees filed Petition in Bombay High Court on October 21, 2011 seeking reliefs in respect of the FCCBs.
• SHARE PRICE OF ZIL PLUNGES: The respondents QVT Fund LP and Quintessence Fund L.P. submitted that due to non-compliance of utilization of sale proceeds of MSD Business for redemption of FCCBs, the share price of Appellant No.1 fell from Rs. 190/- to Rs. 45/- in a span of 45 trading days in the year 2011.
• CONTENTION OF APPELLANTS - ZIL: The Appellants further contended that the rights and interests of the FCCB Holders had already been protected by the High Court's order dated October 9, 2012 upon passing of Notice of Motion moved by Plaintiff Trustee - 'The Bank of New York Mellon', London Branch.
• CONTENTION OF ZIL AGAINST SEBI's ORDER: It was further contended that the order of SEBI dated March 25, 2013 was without jurisdiction, void ab initio and illegal particularly because the same issue dealt in the impugned order is also the subject matter of the proceedings before the High Court and that the rights and interests of the affected parties in the matter of redemption of FCCBs in question are duly protected by the order dated October 9, 2012.
• ALLEGATIONS OF SEBI OVER ZIL: 

1. The amount received from the sale of MSD Division was not utilized for the purposes for which it was raised i.e. for redemption of FCCBs but was diverted for other purposes.
2. The Appellants failed to inform BSE/NSE about their default in repayment of FCCBs and further tried to hide the information about the default in repayment of FCCBs untill intervention of Stock Exchanges.
3. Appellants did not disclose the Price Sensitive Information as required under the Listing Agreement and SEBI (Prevention of Insider Trading) Regulations, 1992. 

Hence, due to such default, suit and Winding up Petitions have been filed against Appellant by the FCCB holders.

SAT'S COMMENTS OVER SEBI'S AD-INTERIM EX-PARTE ORDER:

Pursuant to the above submissions, it was held that the impugned ad-interim ex-parte order dated March 25, 2013 is not sustainable in the eyes of law as it has been passed in gross violation of the principles of natural justice. Further it was held that SEBI is empowered to pass ex-parte ad-interim orders, however this power can be exercised  in most deserving cases of extreme urgency only as in the present case SEBI had knowledge in the matter from the beginning itself.

NEWS WRAP - AUGUST 28, 2013

• Sensex crosses 590 points as Rupee hits 68-mark vs Dollar to a life-time low.

• Financial Technologies, promoter of NSEL extends Rs. 177.4 crore loan to help NSEL avert default in second payout.

• Luxury brands like Hermes, Gucci & others to take on faster growing fakes in India; Hermes got an injunction order from Delhi High Court to stop Da Milano from selling hand bags identical in shape & design.

• Former Promoters of Zandu Pharmaceuticals, 'the Parekhs' to invest Rs. 150 crore in Gujarat Nutraceuticals Plant.

• Realty Bites: Brand owners tie up with malls to escape high rentals in Mumbai, New Delhi.

• Country's third largest Back Office Provider Aegis eyes 3 targets worth up to Rs. 225 crore.

• Novartis' subsidiary Chiron snaps its 8 year old Vaccine JV with Delhi based Panacea Biotech.

• Maruti's Gujarat plant delayed due to slump sales.

• SAT quashes SEBI's ban against HB Stockholdings, Alaknanda Capital Services and Hari Sai Investments for an unnatural delay in proceedings.

• SEBI allows 73 entities to set up Alternative Investment Funds (AIFs) for Real Estate, Private Equity and Hedge Funds.

• Dubai Index worst hit among world Stocks on possibility of US strike on Syria.

• FIPB clears US Pharma major Mylan Inc's Rs. 5,168 crore FDI proposal to acquire Agila Specialities Pvt Ltd.

• Government clears 36 stalled Infra Projects worth Rs. 1.83 lakh crore; Reliance Power's Sasan Project and L&T's Metro Rail Project among cleared.

• Shangri-La Hotels, Phoenix Mills end Management Contract in Mumbai.

Source: Economic Times

NEWS WRAP - AUGUST 27, 2013

• Saudi Aramco eyes stake in ONGC Petro Additions Ltd (OPal); to acquire up to 30% stake in Gujarat Petrochem Project.

• CX Partners in talks to buy Future Venture's 28.3% stake in Biba Apparels for Rs. 300 crore.

• Airport Privatisation may lead to higher fares: IATA.

• State owned Fuel Retailers likely to get Rs. 8000 crore Cash Subsidy on September 17 for first Quarter.

• USDFA warns 2 more Indian firms 'Promed Exports and Posh Chemicals' for manufacturing lapses; most of the companies no longer get 3 months' notice before inspection.

• Around 20 Indian Air Charter Operators including Taj Aviation, Reliance Commercial Dealers and Oberoi Group's Charter Devision to request DGCA to lift ban on all their International Flights.

• Bharat Biotech launches Typbar-TCV, the world's first clinically proven Typhoid Conjugate Vaccine.

• Videocon slashes call rates to US and Canada by 98%, makes ISD Cheaper than local calls.

• BSE to suspend Trading in Securities of 15 Companies including Koutons Retail and Dunlop India for failure in complying with the provisions of Listing Agreement.

• NSE sells over 2% MCX - Multi Commodity Exchange.

• SEBI imposes Rs. 40 lakh fine on Ankur Drugs and Pharma for non-disclosures of Pledged Shares of Promoters.

• Tata Group Firm Indian Hotels to open 19 new properties under 'The Gateway Hotels and Resorts' in four years.

Source: Economic Times

NEWS WRAP - AUGUST 26, 2013

• At Infosys, Power centre shifts to Narayana Murthy's Office; Murthy overturns CEO Shibulal's move to Decentralise decision-making.

• Government to appoint Expert to check RIL Gas Hoarding Issue.

• Gail India in talks with Qatar to secure 3 million tonnes of LNG; offers help to Qatar Petroleum to acquire 5% Equity in Petronet LNG.

• NSEL Chairman Shankarlal Guru, resigned from the Board.

• ONGC plans to pay $2.6 Billion to buy Anadarko Petroleum (APC)'s Gas Stake in Mozambique Gas Field.

• India's Long Shoreline at a risk of Serious Ecological Disaster.

Source: Economic Times

NEWS WRAP - AUGUST 24, 2013

• Government asks Drug controller DCGI  to check quality of drugs sold by Ranbaxy.

• Drug major 'Lupin' gets US Health Regulator USDFA's nod to market Tuberculosis Drug in America.

• Government plans to sell stake in 5 PSUs including EIL, BHEL and IOC this fiscal.

• 15 new drugs for Type-2 Diabetes are in late stages of development : Frost & Sullivan's Competitive Intelligence Research Analysis Report.

• Massive fire at HPCL's Vizag Refinery, second blaze in past 3 months.

• RBI penalizes 6 Public Sector Banks (PSBs) for violation of KYC and AML norms.

Source: Economic Times

NEWS WRAP AUGUST 23, 2013

• Bharti Airtel in advanced talks to sell off its Sri Lankan operations to Abu Dhabi's Etisalat.

• FMC demands details as Cheques of Rs. 550 crores deposited by borrowers on NSEL bounces.

• Canada based Manulife Financial Services in advanced talks with Exide Industries to acquire 26% stake in ING Life.

• Kishore Biyani owned Future Ventures in talks to sell its 22.86% stake of AND Designs to General Atlantic for Rs. 150-200 crore.

• Bajaj Corp acquires 'Nomarks' Brand from Ozone Ayurvedics for Rs. 150 crore.

• Coca-Cola to invest $ 5 billion in India by 2020.

• Number of defunct companies rose by nearly 34% to 2.35 lakh in 2012.

• Country's largest Hydro Power producer, NHPC to buy back shares worth Rs. 1600 crore.

• SEBI revokes restrictions imposed on Ras Resorts and Apart Hotels.

• Post NSEL fiasco, depositories NSDL and CDSL ask MCX Traders to convert their DEMAT holdings into Delivery.

• RBI to auction 1.44% Inflation Indexed Bonds maturing in 2023 for Rs. 1000 crore on August 26, 2013.

Source: Economic Times

NEWS WRAP AUGUST 22, 2013

• Direct Taxes Code: Super rich individuals with over Rs. 10 crore income may have to pay 35% tax.

• Kumar Mangalam Birla to raise Hindalco stake to 37% for Rs. 2,165 crore.

• SUBWAY targets Europe with 1000 new outlets in 2014.

• IPad's China market share plunges as Domestic Tablet makers gain.

• IIFC to raise Rs. 2400 crore in Tax-free Bonds to meet immediate lending commitments.

• Manpasand Beverages in final talks with IDFC Alternatives to sell 10% stake to raise Rs. 150 crore for expanding its Product Portfolio.

• Zydus Cadila gets USDFA nod to market anti-ulcer capsules.

• Maruti Suzuki looks to beat slowdown, launches Stingray Compact Car priced between Rs. 4.10-4.67 lakhs.

• High Court rejects Colgate's Petition against HUL's Pepsodent advertisement.

Source: Economic Times

DEREGULATION OF INTEREST RATES ON NON-RESIDENT (EXTERNAL) RUPEE (NRE) DEPOSITS

ISSUING AUTHORITY : RESERVE BANK OF INDIA

DATE OF ISSUE : 14/08/2013

EFFECTIVE DATE : IMMEDIATE EFFECT

CIRCULAR NO. RBI/2013-14/186

In exercise of the powers conferred by Section 35A of the Banking Regulation Act, 1949 and in modification of the directive DBOD. Dir. BC. 63/ 13.03.00/ 2011-12 dated December 16, 2011 on Deregulation of Interest Rates on Non-Resident (External) Rupee (NRE) Deposits and Ordinary Non-Resident (NRO) Accounts, it has been decided that banks are free to offer Interest Rates without any ceiling on NRE Deposits with maturity of 3 years and above.

The extant ceiling on NRO Accounts shall continue.

These Instructions will be valid up to November 30, 2013, subject to review.

For detailed Circular, follow the Link given below:
DBOD.Dir.BC.40 /13.03.00/2013-14

INTEREST RATES ON FCNR(B) DEPOSITS

ISSUING AUTHORITY : RESERVE BANK OF INDIA

DATE OF ISSUE : 14/08/2013

EFFECTIVE DATE : IMMEDIATE EFFECT

CIRCULAR NO. RBI/2013-14/185

In exercise of the powers conferred by Section 35A of the Banking Regulation Act, 1949 and in modification of the directive circular No.DBOD.Dir.BC.102/13.03.00/2011-12 dated May 4, 2012, it has been decided that with effect from the close of business in India as on August 14, 2013, the interest rates on FCNR(B) Deposits are as under:

MATURITY PERIOD	EXISTING	REVISED
1 year to less than 3 years	LIBOR/SWAP plus 200 basis points	No change
3 - 5 years	LIBOR/SWAP plus 300 basis points	LIBOR/SWAP plus 400 basis points

For Floating Rate Deposits, the Interest reset period shall be Six Months.

These Instructions will be valid upto November 30, 2013, subject to review.

For detailed Circular, follow the Link below:
DBOD.Dir.BC. 38 /13.03.00/2013-14

NEWS WRAP AUGUST 21, 2013

• RBI takes steps to ease liquidity; cuts SLR, also to buy Rs. 8000 crore bonds.

• Prices of Imported and Premium products may rise; Consumer Goods from Apparel to Oil to Electronics & Mobiles to cost more.

• Gas producers Reliance Industries, ONGC, Cairn, Oil India earnings to get a boost as Rupee tumbles as they sell the fuel in Dollars.

• Top deck leads exodus at KPMG Forensic Audit Devision, five of six partners at the unit quit including Head of Risk Consulting Group 'Sanwalka'.

• Top marketers such as HUL, Nestle, Coca-Cola and Dabur subscribe to animated VJs to promote their products.

• PepsiCo looks to bid for Balaji Wafers.

• Nissan unveils redesigned 'Terrano' SUV in Rs. 8.3-12.9 lakhs price range.

• Apollo's $2.5 billion Cooper acquisition deal faces unexpected opposition from 5000 Chinese striking Workers in Shandong Province.

• SRF closes manufacturing operations in Dubai due to ownturn in European market.

• To check losses caused by technical glitches, SEBI makes testing, audit of software tools must for Brokers.

• Indirect Tax Collections grow by 2.9% in April-July 2013, due to decline in Excise duty, slump in manufacturing activity.

• Unlisted Companies may soon debut on Foreign Exchanges.

• Thai-India Trade likely to double to $16 billion by 2015.

Source: Economic Times

NEWS WRAP - AUGUST 19, 2013

• Government clears big-ticket investment stalled Infra Projects worth Rs. 1 lakh crore from Power and Petroleum to Highways and Railways.

• AirAsia India gets pilots & crew on board; likely to launch in November, 2013.

• Zydus to start Rs.100 crore facility in Vadodara by 2015; plans to expand its hospital business across Gujarat.

• Tata Starbucks builds war chest for expansion, to increase its Authorised Capital by creating additional capital of 150 million Equity Shares of Rs.10 each; to open 100 cafes across the country.

• RJ Corp's arm - Varun Beverages in talks with PE Funds to raise Rs. 300 crore by selling minority stake in the company.

• Samsung looking to release Android based Wrist Watch next month.

• Singapore based Temasek disappointed after CCI slaps Rs. 50 lakh fine, to take steps after studying the order.

Source: Economic Times

NEWS WRAP - AUGUST 17, 2013

• FDI in Pharma: PM overrules DIPP, clears decks for Mylan Inc's $1.6 billion takeover of Agila Specialities.

• Banks may have to write off Rs. 7200 crore debt to Microfinance Institutions, recoveries difficult for Micro lenders in Andhra Pradesh.

• 'Eternal Gandhi' Museum inaugrated at Ahmedabad International Airport, which has on display collectables inspired by Mohandas Karamchand Gandhi.

• Gujarat excluded from 'Incredible India Campaign'.

• Bamboo scarcity, labour issues hit Agarbatti Industries.

Source: Economic Times

REDUCTION OF LIMIT FOR OVERSEAS DIRECT INVESTMENT

ISSUING AUTHORITY : RESERVE BANK OF INDIA

DATE OF ISSUE : 14/08/2013

EFFECTIVE DATE : IMMEDIATE EFFECT

CIRCULAR NO. 23

Previously, in terms of the provisions under FEMA, 1999 on Overseas Direct Investments (ODI), the total Direct Investment by an Indian Party in Overseas Joint Ventures (JV) or Wholly Owned Subsidiaries (WOS) was limited to the extent of 400% of the Indian Party's Net Worth. This limit has now been reduced to 100% of the Indian Party's Net Worth as on the date of last audited Balance Sheet under the Automatic Route.

The reduced Limit is also made applicable to Investments by Indian Companies in Overseas Unincorporated Entities in the Energy and Natural Resource Sector. Any ODI in excess of 100% of the Net Worth shall be considered under the Approval Route by RBI.

These provisions would apply to all fresh Overseas Direct Investment proposals on a prospective basis but would not apply to the existing JV/WOS set up under the extant guidelines.

For detailed Circular, follow the Link given below:
A. P. (DIR Series) Circular No.23

LIBERALIZED REMITTANCE SCHEME FOR RESIDENT INDIVIDUALS - REDUCTION OF LIMIT FROM USD 2,00,000 TO USD 75,000

ISSUING AUTHORITY : RESERVE BANK OF INDIA

DATE OF ISSUE : 14/08/2013

EFFECTIVE DATE : IMMEDIATE EFFECT

CIRCULAR NO. 24

The Limit for Remittances made by Resident Individuals under the Liberalised Remittance Scheme (LRS) has been reduced from USD 2,00,000 to USD 75,000 per Financial Year. Hence, under the Scheme, Remittance up to USD 75000 per financial year shall be allowed for any current or capital account or a combination of both.

Changes and Clarifications issued in this regard are:

1. Resident Individuals have, however, now been allowed to set up Joint Venture/Wholly Owned Subsidiary outside India under the outside India for bonafide business activities within the revised LRS limit with effect from August 5, 2013 subject to terms and conditions stipulated in Notification No. FEMA 263/RB-2013 dated August 5, 2013.
2. While current restrictions on the use of LRS for prohibited transactions, such as, Margin Trading and Lottery would continue, use of LRS for acquisition of Immovable Property outside India directly or indirectly will, henceforth, be not allowed.
3. Further, the limit for Gift and Loan Amount by Resident Individuals to NRI close relatives shall be within the LRS limit of USD 75,000.

All other terms and conditions issued in this regard shall remain unchanged.

For detailed Circular, follow the below Link:
A. P. (DIR Series) Circular No.24

INVESTMENT BY QUALIFIED FOREIGN INVESTORS (QFIs) IN CORPORATE DEBT SECURITIES

ISSUING AUTHORITY : SECURITIES AND EXCHANGE BOARD OF INDIA

DATE OF ISSUE : 13/08/2013

EFFECTIVE DATE : IMMEDIATE EFFECT

CIRCULAR NO. CIR/IMD/FIIC/13/2013

Qualified Foreign Investors (QFIs) had been allowed vide Circular CIR/IMD/FII&C/17/2012 dated July 18, 2012 to invest in Listed/to be Listed Indian Corporate Debt Securities through Public issues and units of debt schemes of Indian Mutual Funds. In order to bring QFI and FII at par, it has now been allowed to invest in "to be listed" Corporate Debt Securities directly from the issuer. In case, the Debt Securities cannot be listed within 15 days of Issue, then the Holding of the QFI is required to be sold off only to Domestic Participants/Investors until the Securities are listed.

All other applicable stipulations prescribed by SEBI in this regard in Circular CIR/IMDFII&C17/2012 dated July 18, 2012 shall continue to apply.

For detailed Circular, follow the Link given below:
http://www.sebi.gov.in/cms/sebi_data/attachdocs/1376394440733.pdf

NEWS WRAP AUGUST 16, 2013

• Walmart Stores unlikely to convert $100 million loan it extended to its Indian Retail Arm - Bharti Retail into Equity; pulls out a key executive from India, shifts priorities from Indian Market.

• Kingfisher Airlines lenders stumped as value of pledged properties crashes.

• Telecom Companies seek to increase mobile call rates by 10 paise/minute.

• Kingfisher Airlines' own Auditors raise Red-flag on its revival plans.

• Iconic Buildings of Lutyens Delhi, including Parliament and Rashtrapati Bhawan, to get a makeover.

• Swiss Drug major Roche to drop anti-cancer drug Herceptin Patent in India.

• Toyota, Suzuki halt Egypt production amid unrest.

• Gold Futures regain Rs. 30,000 level on Global cues.

• Reliance Industries to explore investment opportunities in Iraqi Oil Fields.

• DLF plans to outsource accounting work to Genpact.

Source : Economic Times

NEWS WRAP - AUGUST 14, 2013

• Customs Duty on Gold, Platinum, Silver hiked to 10%, yellow metal made costlier by Rs. 600/gram; Rupee celebrates with a gain of 8 paise.

• Harvard Law School professor Ashish Nanda appointed as IIM-A Director to give global push.

• Mother Dairy bets big on Frozen Veggie Menu; to launch Frozen Onion Rings, English Carrots and other veggies.

• SEBI seeks clarification from Power Solutions Provider 'Inox Wind' for its proposed Rs. 700 crore Initial Public Offer (IPO).

• Arundhati Bhattacharya; SBI may get fist lady MD.

Source: Economic Times

LAW LEXICON - The Law Dictionary

• Cypres: As near to.
• In Personam: Right against a Person.
• ad idem: With a common understanding.
• Sui juris: Of his own right.
• Tortum: Civil wrong actionable without contract. Body/gist of the offence.

NEWS WRAP AUGUST 13, 2013

• Gold, Silver, Non-Essential Imports to cost more, measures to fetch additional $11 billion and to check Rupee's  fall and Current Account Deficit.

• Swedish Furniture major IKEA to set up Single Brand Retail Stores in 4 states - Haryana, Karnataka, Andhra Pradesh and Maharashtra.

• ICICI opens 23 Rural branches in Gujarat.

• Cadila Scrip bucks trend, declines 40% in one year.

• Toyota to launch 'Camry Hybrid' in India.

• Cookie Man's SBP Pattabhi Rama Rao plans national chain of Idli & Dosa Restaurants.

• American Express links a Debit Card to an Online Video Game.

• Travel Food Services (TFS) wins bid to manage lounge operations at Terminal 2 of Mumbai Airport.

• India initiated 159 anti-dumping cases against China.

• VLCC buys 80% in Singapore-based cosmetics maker 'GVig' for Rs. 180 crore.

• Idea Cellular becomes Aditya Birla Group's most valuable biz; overtakes its flagship commodity businesses.

• ICICI Bank to sell Mumbai's Prabhadevi property for Rs.100 crore to offer its Executives compensation for rent instead of accomodation in their Anual Package.

• India to lease bandwitdth from Bangladesh to reduce BSNL's dependence on Tata Communications.

Source: Economic Times

COMPOUNDING OF CONTRAVENTIONS UNDER FEMA, 1999 - REFUND OF COMPOUNDING FEES

ISSUING AUTHORITY : RESERVE BANK OF INDIA

DATE OF ISSUE : 12/08/2013

EFFECTIVE DATE : IMMEDIATE EFFECT

CIRCULAR NO. 20

It has been decided to expedite the refund of compounding fees for Return of Applications for Compounding of contraventions of FEMA, 1999, which are submitted without obtaining prior approvals or permission from the concerned authorities, by way of crediting the application fees of Rs. 5000/- (received along with application) to the applicants's account through NEFT.

Hence, the applicant's are required to include the details of Income Tax PAN and the Activity as per NIC Codes and are advised to furnish their details of bank account as per ANNEX to the said Circular.

For detailed Circular, log on to the Link given below:
A.P. (DIR Series) Circular No. 20

NEWS WRAP - AUGUST 12, 2013

• Government may relax FDI Norms for Real Estate Sector to boost fund flows.

• Labour Unrest continues to bother Gujarat Industry; since 2 years, Arvind, RIL, Ashima, Syntex, Hitachi and Apollo Tyres have been paralysed by Labour strikes.

• FIIs raises stake in Gujarat - headquartered mid-cap companies; Atul, Hitachi, Symphony, Zydus on Foreign Funds radar.

• Sun Pharmaceutical Industries to pay Rs. 2517 crore to settle Patent Suit as a part of settlement agreement with Pfizer and Takeda GmbH.

• Drug Companies urge Prime Minister's Office to intervene the 'New Drug Pricing Enforcement', they feel new prices of drugs are below than envisaged.

• Exodus from ArcelorMittal India; 20 top executives and CEO Sanak Mishra quit job.

• SBI appoints Arundhati Bhattacharya as new CFO, elevates 7 CGMs and DMDs.

Source: Economic Times

SEZ BOOSTER DOSE - RELAXING NORMS, SEEKING INVESTMENTS

The Government is set to notify measures giving a fresh impetus to investments in Special Economic Zones (SEZs) and boost exports including a cut in minimum area required for such zones and introduction of new Scheme for Electronic Hardware and Food Processing.

The proposed Measures are: 

1. Agro-based Food Processing SEZs will be introduced.
2. The minimum area required for electronic Hardware and Agro-based Food Processing SEZs has been fixed to 10 hectare.
3. Electronic Hardware SEZs will be eligible for certain additional benefits including 20% Capital Subsidy.
4. Investors will be able to set up both Software and Hardware facilities on same premises.
5. Multi-services SEZs will be treated on a par with single-product SEZs with minimum area halved to 50 hectares.
6. Developers will be allowed to use land with some prior minor construction as a vacant land for SEZ.
7. SEZ will also allow easier Exit for developers, allowing them to transfer or sell ownership of SEZs units.

The aim is to give incentives to push SEZs out of big cities and explore less dense cities.

CURRENCY CALCULATOR (AS ON AUGUST 10, 2013)

CURRENCY	INDIAN RUPEES
UNITED STATES	60.861
AUSTRALIA	55.214
BRITAIN	94.390
CANADA	58.460
JAPAN (100 UNITS)	63.230
SINGAPORE	48.241
SWITZERLAND	66.101
UAE	16.576
EUROLAND	81.313

NEWS WRAP - AUGUST 10, 2013

• Domestic Steel producers oppose Government's easing of Import rules.

• RIL, IOC, ONGC, GAIL among 8 firms in race to buy 25% stake in LPG Import Terminal, to come up at Mundra, Gujarat.

• Tata Steel wins order to supply rails to High Speed Rail Line Project linking 2 holy states Mecca and Medina.

• Ad War: HUL's Pepsodent 'Germicheck' Toothpaste takes on Market Leader Colgate, latest Advertisement has been strategically timed giving enough visibility to P&G's Colgate in its Ad.

• IT Refunds help BSNL to bring down its losses to Rs. 8100 crore.

• Ratnakar Bank acquires Royal Bank of Scotland's (RBS) Commercial and Home Loan Portfolio and Credit Card Business in India.

• SEBI imposes Rs. 12 Lakh penalty on 3 entities for non-compliance with SEBI's Summons in Sanjay Dangi Case.

• Consumer Forum directs Spice-Jet to pay Rs. 1 Lakh for Unfair Trade Practice making family members board different flights despite of confirmed tickets.

• Blackberry warming up to possibility of going Private to fix its problems out of public eyes.

Source: Economic Times

NEWS WRAP - AUGUST 09, 2013

• Sahara Group to launch clubs with Membership Fees upto Rs. 1.5-30 crore; planning to launch chain of clubs in India as well as Overseas.

• Gujarat biggest home to vanishing Companies: Sachin Pilot.

• Falling Rupee to hit Electronic Goods, Panasonic India to hike prices if Rupee goes down further.

• Apple seeks New Samsung Device sales ban in U.S. with Court Appeal for violation of Patents of Iphone's look and features.

• RBI to transfer Rs. 33,000 crore in Surplus Profit to Government.

• Imprudent decisions by 4 PSU Insurers caused Rs. 122 crore loss: CAG.

• NSEL crisis: Birla, Tata AMCs sell MCX Shares.

• Pay up, FM warns Service Tax defaulters, non-payment of collected Service Tax in excess of Rs. 50 lakhs is now considered as a non-bailable offence and attracts imprisonment upto 7 years.

• Excise based on manufacturing cost of cars instead of discounted sale price to apply prospectively.

• Government to revive 44 Central Public Sector Enterprises (CPSE) with an aid of Rs. 28,333 crores.

Source: Economic Times

AMENDMENT IN THE REGISTRATION ACT, 1908 TABLED BEFORE PARLIAMENT

The Registration (Amendment) Bill, 2013

The Key Amendments proposed are:

• Presently, 'Book 4 - Miscelleneous Register' which contains details of all Registered Documents (except Wills) is not open for access. The said Book 4 is proposed to be made open to inspection by the public.
• To ensure gender equity, documents relating to adoption of daughters along with sons are required to be registered.
• Registration of documents shall be allowed anywhere in a given State or Union Territory.
• As the computerization of Land records is making rapid strides, Electronic Registration of documents shall be made available.
• Documents of Power of Attorney's, Developers/Promoters Agreements and any other agreements relating to sale of development of Immovable Property now needs to be mandatorily registered to minimize cases of Document Forgery.
• Presently, the Sub-Registrar's Office has no power to refuse registration of documents which allows unauthorized individuals to get false registrations done, accordingly a new Section 18A is proposed to be inserted to provide prohibition of registration of certain types of properties.

COMPETITION COMMISSION OF INDIA IMPOSES PENALTY ON 11 SHOE COMPANIES

The Competition Commission of India has imposed a penalty of Rs. 625.43 lakhs on 11 Shoe Companies in a case filed by Director General - Supplies & Disposal, New Delhi relating to a tender for supply of Poleyster Blended Ankle Boots.

CHARGES:

The Investigation conducted by CCI revealed that 

1. The bidder-suppliers by quoting identical/near identical rates had, indirectly determined prices/rates in the Rate Contracts finalized by DG S&D
2. Indulged in bid rigging/collusive bidding in contravention of the provisions of section 3(1) read with section 3(3)(a) and 3(3)(d) of the Act.
3. The parties had also controlled/limited the supply of the product in question and shared the market of the product amongst themselves under an agreement /arrangement in contravention of the provisions of section 3(1) read with section 3(3)(a) and section 3(3)(d) of the Act.

PENALTY:

CCI has worked out a Penalty @ 5% on the Average of the Gross Turnover for financial years 2008-09, 2009-10, 2010-11. CCI has directed these companies to deposit the amount within 60 days from the receipt of order.

The Order of the Commission was passed on 06/08/2013 (Reference Case No. 01of 2012). 

COMPANIES LAW GETS A COMPREHENSIVE MAKEOVER

Here are the Salient features of the New Bill:

1. The Bill has 470 clauses & the entire Bill has been divided into 29 Chapters.
2. The Bill prescribes 33 new definitions. Some of them are Associate Company, Small Company, Turnover, Chief Executive Officer, Chief Financial Year, Global Depository Receipt, Fraud and wrongful gain, etc.
3. The number of Members of Private Companies increased from 50 to 200.
4. Incorporation of One Person Company is permitted. It will be a Private Limited Company.
5. Prescribed class or classes of Companies are required to appoint at least One Woman Director.
6. More Statutory Powers to the Government's Investigative arm Serious Fraud Investigation Office (SFIO) to tackle Corporate Fraud.
7. The limit of maximum number of Companies in which an Auditor can serve is 20 and they are to be Appointed for 5 Years which shall be subject to ratification by Members at every Annual General Meeting.
8. Every Company with Net worth of Rs. 500 crore or more, or Turnover of Rs. 1,000 crore or more     or a Net Profit of Rs. 5 crore or more during any Financial Year to constitute a CSR Committee of     the Board consisting of Three or More Directors, of which at least one Director shall be an                 Independent Director. Companies are required to spend at least two percent (2%) of their Net Profit on Corporate Social Responsibility.
9. The Bill has provisions that allow Shareholder Class Action Law Suits, better disclosure requirements in Financial Statements, disclosure of Interest of Directors, etc.
10. The Bill provided for constitution of NCLT and NCLAT.
11. Mergers and Amalgamations have been now simplified - improved transparency, became more easier and clearer.
12. The New Law mandates payment of two years' salary to employees in Companies that wind up operations.

Now the Bill goes for Presidential Assent.

NEWS WRAP - AUGUST 08, 2013

• Home and Car Loans to cost more as PSU Banks hike Lending Rates.

• After steady decline in Market Share, Hero Motocorp aims at getting back 50% Market Share by introducing slew of new products.

• Cadbury to invest over Rs. 1,000 crore in its Andhra Pradesh plant; to be largest plant in Asia-Pacific.

• NSEL Chief - Shankarlal Guru's Son-in-law among top defaulters, owes Rs. 929.9 crore.

• Rohini Nilekani who sold Infosys Shares worth Rs. 164 crore to chart a new course in Philanthropy.

• Karnataka Wakf Board asks ITC Windsor to vacate the Property within 45 days.

• Reliance Industries Ltd. to go slow on 720,000-sq-ft Alaknanda Mall in South Delhi following strong protests.

• PE Funds including Tata Capital's PE and Morgan Stanley Global Private Equity to invest Rs. 350 crore in MFL Janlakshmi Financial Services.

• Amul to spread Bakery Business; new plant for cookies on menu.

• Star Sports ropes in Mahendra Singh Dhoni as Brand Ambassador to endorse Football.

• RBI imposes Rs. 5.6 lakh fine on SBI for violation of Currency chest Norms.

• East Africa's Largest Airport 'Nairobi Airport' hit by huge fire.

• Coal India Limited workers to strike work from September 19, 2013.

Source: Economic Times

NEWS WRAP - AUGUST 07, 2013

• Former IMF Chief Economist 'Raghuram Rajan' becomes new RBI Governor.

• S P Jain Institute bags First Place in ISB-Ivey Global Case Study Competition conducted by Indian School of Business (ISB).

• Cadila Pharmaceuticals looking to set up $150 Million manufacturing unit in Astrakhan, Russia.

• Sanjeev Kapoor promoted - Wonderchef Home Appliances targets 3 fold jump in turnover to Rs. 160 crore by 2017.

• Vodafone, ICICI launches Mobile Money Transfer Service 'M-Pesa' in Bihar.

• Investors pull out over Rs. 48,000 crore from Mutual Fund Schemes in June, 2013.

• Subrata Roy not liable for refunding Rs. 24,000: Sahara to Supreme Court.

• Securities Appellate Tribunal quashes SEBI's order against NSDL in IPO Scam.

• CBEC plans to offer relief to battered Auto Industry.

• FIPB clears 12 FDI proposals worth Rs. 343 crore; decision on US based Mylan Inc's proposal to acquire Indian Pharma Company on hold.

• Government plans Incentive Fund for Healthcare with corpus of over Rs. 10,000 crore to provide additional Assistance to State Governments.

• 48% of all Infra Projects costing over Rs. 150 crore delayed: Government.

• Pharma Department to meet drugmakers today to sort out pricing problems.

• Mumbai's mega Infra Projects hit roadblock as most of the Projects are abandoned or derailed.

Source: Economic Times

LAW LEXICON - The Law Dictionary

• Quo Warranto: A writ or legal action requiring a person to show by what warrant an office or franchise is held.

• Modus Operandi: A particular way or method of doing something.

• In posse: In a state of possibility.

• Ex turpi causa non oritur  action: No action arises from an illegal or immoral cause.

• Sub Judice: Under judicial consideration.

NEWS WRAP - AUGUST 06, 2013

• SEBI looking closely at Holcim-Ambuja Cements deal; feels ACC-Ambuja was better option.

• Small Investors to get priority in NSEL payouts: FMC.

• Sameer Suneja, former India head of Perfetti to become Global CEO of World's third largest confectionery group; first non-Italian to head Italian Sugar Confectionery.

• Aviva likely to exit Indian Life Insurance JV, third Foreign Company to quit India since 2012.

• RBI may soon issue final guidelines on Subsidarization of Foreign Banks.

• RBI pulls Dhanlaxmi Bank for rise in bad loans, appoints Manoranjan Dash as Director on Bank's Board.

• Amid economic slowdown over supply, Hotel Occupancy dips by 10-15%.

• Mumbai based Real Estate Developer Orbit Corporation defaults on Rs. 96 crore Loans.

• Bajaj Auto to shift 50% production from Pune if strike does not end in a week: Rajiv Bajaj.

• Government plans to test all imported telecom devices for bugs and malicious software from October 1, 2013.

• 154 Companies including Saradha Group and Rose Valley Group come under scanner for Financial Fraud.

Source: Economic Times

NEWS WRAP - AUGUST 05, 2013

• NSEL suggests phased payments to end crisis.

• British Telecom major Vodafone not in favour of holding its Rs. 20,000 crore withholding tax dispute under Indian Jurisdiction; seeks Neutral Authority like UNCITRAL.

• Private Refiners made Rs. 10,000 crore on flawed pricing of Petrol and Diesel: CAG.

• Tata Motors cuts Pantnagar Unit Workforce by 21% in drive to cut costs.

• After Akash, Government planning sub-$100 Smartphones to push Broadband Services.

• Quick Heal plans Initial Public Offer, First Indian Anti-Virus Company to go Public.

• Investors in tax havens may have to share Information by signing Share Banking Agreement with CBDT.

• Union Bank to raise Rs. 3,000 crore Equity to meet Basel-III Norms after 2015.

• Mutual Funds withdraw Rs. 2,100 crore from Stocks in July.

• Market Capitalization of top 6 Companies dip by Rs. 92,649 crore; ITC, ONGC hit hard.

• Reliance Infrastructure to digitise Customer Services in 71 Bihar towns to cut losses of Bihar State Electricity Board (BSEB).

• Relaxation of Port Tariff Rules vide issue of New Tariff Guidelines 2013, to create new and different projects within major ports.

Source: Economic Times

NEWS WRAP - AUGUST 03, 2013

• FTIL & MCX Stocks continue to be hammered; Spot Trading to come to Forward Markets Commission (FMC) net post-NSEL.

• Rupee Depreciation: Global Funds like Fidelity, HSBC, JP Morgan, Franklin sell Indian Equities worth $1.4 billion.

• BCCI to appeal High Court's Order; Srinivasan made to wait.

• Infosys founder Nandan Nilekani's wife Rohini sells 5.77 lakh Infosys stocks worth Rs. 163.51 crore, plans to use money for philanthropic activities.

• Telecom Department issues final Unified License Norms, telecos can enter into Roaming Pacts.

• GlaxoSmithKline loses Cancer Drug Patent in India for its Anti-Cancer Drug 'Tykerb'.

• TRAI Chief Rahul Khullar says 3G roaming pacts must be allowed.

• ISRO, Tata Motors develop India's first Hydrogen Fuel cell Bus.

• Google  enters Smart Phone Market with 'Moto X'.

• Reliance Industries Limited denies CAG charges, says it cleared all dues to MMRDA for its upcoming project BKC.

• Single Brand Retailers like Mark's & Spencers allowed to sell sub-brands from stores.

• SEBI imposes Rs. 25 lakhs penalty on Keynote Commodities for Fraudulent Trade Practices in IPO of Emmbi Polyarns in 2010.

• Power Grid Corporation to Increase Capital expenditure by 10-15%; to sell 15% through Offer for sale.

• BSE halves Circuit limit for Multi Commodity Exchange (MCX)  Shares with effect from August 5, 2013.

• Kerela State with best Health Indicators, has the lowest density of Doctors.

• TVS Motor Company plans to set up manufacturing unit in Uganda.

Source: Economic Times

PORT PERFORMANCE SIGNALS SHIFT IN CARGO TRAFFIC

As reported by ICRA, Cargo traffic at India's 12 major ports which accounts for 58% of India's total seaborne cargo showed a decline of 2.6% in 2012-13 compared to 1.7% decrease in 2011-12.

CAUSES OF DECLINE IN CARGO TRAFFIC

At a time the cargo traffic at major ports are conveying sluggish signals, non-major ports in the country are reported to be doing better and are outpacing major ports in cargo traffic growth. 

Non-major ports handled nearly 42% of the maritime freight traffic of the country during 2012-13.

  

According to ICRA, the cargo growth outlook for the Indian Port Sector continues to be strong over the medium to long term driven by the domestic requirements of coal, power, crude oil, domestic petroleum requirements and containers given the cost and logistical advantages associated with containerization.

The growth in quantity cargo handled at non-major ports has been primarily driven by growth in non-major ports in Gujarat which account for about three-fourth share in cargo handled at non-major ports.

 

TRAFFIC HANDLED BY NON MAJOR PORTS

NEWS WRAP - AUGUST 2, 2013

• Payment crisis at National Spot Exchange: Bourse halts trade as Rs. 5500 crore trading positions outstanding.

• GOAL, Avarsala and Godrej & Boyce developing parts worth Rs. 700 crore for world's largest telescope.

• L&T explores Business trust model for its Infrastructure development arm IDPL's road Portfolio; to raise Rs. 2500 crore.

• Amrit Kaur: Aged 80, India's newest billionaire, won father's wealth worth Rs. 2000 crore.

• Gold Import Curbs causes Investors switch trading to Silver.

• Airtel ropes in Bharti Walmart's suspended CFO, Pankaj Madan.

• Sintex Industires scrip down 92%, Torrent Power, Adani Power, GMDC touch multi year low.

• Crocs sees big opportunity in India, to bring in more of its 350 odd designs from Global Portfolio.

• Louis Vuitton, Hermes, Gucci top three global luxury brands 2013.

• Fiat meets creative Agencies for brand Jeep; plans to launch its SUVs Grand Cherokee and Wrangler in India by the year end.

• Coke Officials to travel Economy Class; a Cost cutting drive of Beverage Maker.

• Fashion retailer Henes & Mauritz launched e-commerce operation in U.S. for e-shoppers.

• SEBI begins probe into FTIL, MCX stock crash for violations in Insider and Fraudulent Trading norms.

• Ryanair's cheap tricks: Passengers may have to pay for cabin baggage.

• Lucrative real-estate Projects to replace petrol pumps in Big Cities.

• Mumbai's Sewri TB Hospital, Asia's largest of its kind, runs out of Drug resistant Medicine.

Source: Economic Times

THE JET-ETIHAD ACQUISITION DEAL, 2013

EMERSION OF THE DEAL:

• Indian Government allowed Foreign Airlines to own up to 49% Stake in Indian Carriers in September 2012.
• On April 22, 2013 Cabinet approved 40,000 Bilateral Seat Rights per week to Abu Dhabi.
• On April 24, 2013 Etihad Airways announced to purchase 24% stake amounting to Rs. 2058 crore in Jet Airways.
• On April 24, 2013 Bilateral Agreement was signed between India and Abu Dhabi followed by Jet-Etihad Deal.

 CONCERNS RAISED BY SEBI AND DIPP:

On July 22, 2013  SEBI and DIPP raised concerns on Effective Control.

SEBI's concerns over Commercial Cooperation Agreement (CCA):

1. CCA will give Etihad Airways the upper hand in Operational Matters.
2. Etihad gets right to source candidates for Senior Management positions.
3. Plan to shift Network and Revenue Management functions and Consolidate Sales Office to Abu Dhabi.
4. Etihad would lead role in Negotiating with Suppliers.
5. All major decisions to be approved by Etihad which would give Etihad Airwyas substantial control over Jet Airways. Hence, SEBI proposed to amend Corporate Governance Code Clauses for passage of Board Resolutions by Simple Majority.
6. The nominations Committee should not have exclusive powers to recommend appointment or removal of all Independent Directors and the CEO as these powers were against the Companies Act, 1956.

DIPP's concerns over Shareholder's Agrement:

1. Effective Control and Ownership lie with Etihad and not Jet Airways.
2. If Naresh Goyal's stake is included, the 49% FDI limit is breached.
3. Under the FDI Norms, Voting and Nomination Rights should stay with Jet Airways.

Jet Airways had submitted a modified Shareholder Agreement on July 25, 2013 to address all concerns raised by various ministries and Stock Market watchdog SEBI.

On July 29, 2013 the deal was cleared with conditions that include:

1. Jet Airways will have to seek prior approval from the Government for making any changes in the Shareholder's Agreement.
2. Articles of Associationshould override Shareholders Agreement.
3. Etihad to get 2 seats on 12 member Board.
4. All Independent Directors should be Indian.
5. Jet airways will appoint 4 Directors of which 1 can be Foreigner.
6. The 9% stake owned by Tailwinds, holding company in Jet will have to be directly owned by Jet Chairman - Naresh Goyal.
7. All disputes relating to Shareholder Pact to be settled under Indian Law.
8. Any Arbitration in respect of other issues can be in London.

The deal is seen as a positive for the Aviation Sector since most of the Indian Carriers are bleeding due to high debt and surging fuel costs.