Monday, 21 April 2014

FOREIGN DIRECT INVESTMENT (FDI) IN LIMITED LIABILITY PARTNERSHIP (LLP)

ISSUING AUTHORITY : RESERVE BANK OF INDIA
DATE OF ISSUE : 16/04/2014
EFFECTIVE DATE : IMMEDIATE EFFECT
CIRCULAR NO. 123


LLP's can accept direct investment from foreign investors, subject to certain riders. Following persons shall not eligible to invest in LLPs:
  1. a citizen/entity of Pakistan and Bangladesh or
  2. a SEBI registered Foreign Institutional Investor (FII) or
  3. a SEBI registered Foreign Venture Capital Investor (FVCI) or
  4. a SEBI registered Qualified Foreign Investor (QFI) or
  5. a Foreign Portfolio Investor registered in accordance with Securities and Exchange Board of India(Foreign Portfolio Investors) Regulations, 2014 (RFPI).
ELIGIBILITY OF LLP FOR ACCEPTING FOREIGN INVESTMENT

LLPs in all sectors where 100% FDI is permitted would be eligible to get FDI. However such investments would need prior government approval. 

PRICING

Any transfer of capital contribution / profit share from a resident to a non-resident would be for a consideration equal to or more than the fair price of the capital contribution or the profit share of the partnership.

Further, any transfer of capital contribution/profit share from a non-resident to a resident would be for a consideration which is less than or equal to the fair price of the capital contribution / profit share of the partnership.
REPORTING REQUIREMENTS
The LLP which have received foreign investment in terms of FIPB approval shall comply with the reporting requirement in respect of FDI within 30 or 60 days, as applicable from the date of receipt of the amount of consideration.
DOWNSTREAM INVESTMENTS
Further, an Indian Company with foreign investment can make a downstream investment in a LLP only if both the company and the partnership operate in the sectors where 100% FDI is allowed under the automatic route.
For detailed Circular, please find the link below:
A.P. (DIR Series) Circular No. 123

Friday, 18 April 2014

NEWS WRAP - APRIL 18, 2014

  • Aviva shortlists Birla Sun Life, HDFC Life & Max Life to sell stake in Joint Venture; valuation likely at over Rs. 5,000 crore.
  • Fabindia to introduce western wear brand 'Fable' next week in a country.
  • RBI sells government bonds worth Rs. 20,000 crore in the country's largest Auction.
Source: Economic Times

Thursday, 17 April 2014

NEWS WRAP - APRIL 17, 2014

  • Ajay Piramal set to pick up 20% stake in Shriram Capital.
  • Nokia's manufacturing plant in Chennai, India will probably be taken out of the deal with Microsoft.
  • Supreme Court willing to defreeze Saharas bank accounts to help Subrata Roy repay Rs. 10,000 crore.
  • Infosys goes WIPRO way, to merge data analytics operations under one roof.
Source: Economic Times

Monday, 14 April 2014

NEWS WRAP - APRIL 14, 2014

  • Flipkart and Myntra enter final lap in negotiation.
  • Bharti in talks with French Retailer, Carrefour for wholesale Joint Venture, may have 74% stake in Venture.
  • Future group to acquire Nilgiris for upto Rs. 175 crore.
Source: Economic Times

Friday, 11 April 2014

NEWS WRAP - APRIL 11, 2014

  • Vodafone acquires Piramal and Analjit Singh's stakes for Rs. 1,241 crores to complete its Indian arm buyout.
  • Dynavest India, a promoter of Max India buys 26 lakhs shares for over Rs. 51 crore.
  • Life Insurance Corporation of India (LIC) buys debt worth Rs. 4,300 crore from State Bond Auctions conducted by RBI of seven states.
  • Bombay High Court asks Geodesic to deposit $162 million in London Bank for its failure to redeem Foreign Currency Convertible Bonds (FCCBs).
  • Online Fashion Brand Yepme goes global, targets NRI market.
Source: Economic Times

Thursday, 10 April 2014

NEWS WRAP - APRIL 10, 2014

  • CCI has approved Rs. 2000 crore Torrent-Elder Pharma acquisition deal in India and Nepal.
  • Narayani heights, a Ahmedabad-based hospitality Company inaugurated its new project Narayani Heights Hotels & Resorts.
  • Infrastructure Firm NCC proposes to raise Rs. 650 crore through Right Issue of equity shares.
  • Sun Pharma-Ranbaxy deal needs CCI clearance to ensure it doesn't lead to a Monopoly.
Source: Economic Times

SUN PHARMA'S RANBAXY ACQUISITION: THE WINNERS AND LOSERS

India's Sun Pharma acquired Gurgaon-based drug maker Ranbaxy Laboratories, owned by Japan's Diiachi Sankyo, for $4 billion in a deal to create world's fifth largest specialty generic Pharma Company through an all-stock merger in which five shares of Ranbaxy will fetch four shares of Sun Pharma. 

Sun-Ranbaxy combined will become largest Indian Pharma Company. The Sun Pharma- Ranbaxy deal is the biggest in Pharma sector in Asia-Pacific.

WHO BENEFITS AND HOW?

Daiichi is the parent company of Ranbaxy since it bought the Indian drug maker from its earlier promoters. With Sun Pharma acquiring Ranbaxy, Daiichi is relieved of the burden of managing Ranbaxy’s problems. It will hold 9% stake in the combined entity.


ENHANCED GLOBAL MARKET PRESENCE


The combined entity will have 47 manufacturing facilities across 5 continents. It will have an established presence in key high growth emerging markets. In India, it will be ranked No. 1 by prescriptions amongst 13 specialty segments.

FINANCIALLY COMPELLING TRANSACTION

Sun Pharma expects to realize revenue and operating synergies of US$ 250 million by third year of acquisition and implement remedial measures to tackle the regulatory issues with the US Food and Drug Administration.

TRANSACTION DETAILS

Under the agreements, Ranbaxy shareholders will receive 0.8 shares of Sun Pharma for each share of Ranbaxy. The expected revenue of the combined entity is $4.2 billion.

Thursday, 3 April 2014

NEWS WRAP - APRIL 3, 2014

  • Greenko in talks with KKR to raise $100 million.
  • Larsen & Toubro may write-off slow moving orders worth Rs. 15,000 crore including 9,000 crore in construction.
  • Supreme Court directs Samsung global head to appear in court in fraud case worth $1.4 million.
  • SpiceJet shares rise over 19% even as the aviation regulator halts Re 1 ticket offer.
  • IPL title sponsor, PepsiCo demands Indian Cricket Board for higher visibility of its brand in cricket stadiums.
  • Bharti Airtel plans to raise $2 billion via bond issues.
Source: Economic Times

Wednesday, 2 April 2014

NEWS WRAP - APRIL 2, 2014

  • Rasna to spend Rs. 1.25 crore over rebranding with new logo and commercials.
  • Credit Policy: RBI bans FIIs from investing in Treasury Bills.
  • Posco moves Competition Commission of India (CCI) seeking captive mine exploration licence in Odisha.
  • Government amends CCI rules related to combinations.
  • India Hospitality Corp (IHC) and Barista Lavazza takeover discussions end without agreement.
Source: Economic Times

Monday, 31 March 2014

NEWS WRAP - MARCH 31, 2014

  • Apple could use buyback formula for iPad Air and Retina iPad mini too.
  • Morgan Stanley almost doubles Gorman's 2013 pay to $18 million.
  • Google, Facebook, Twitter eye Rs. 500 crore social media election pie.
Source: Economic Times

Saturday, 29 March 2014

NEWS WRAP - MARCH 29, 2014

  • Nokia to Madras High Court: Can’t pay even part of Rs 2,400 crore sales tax demand.
  • SEBI summons Etihad officials over stake deal with Jet to clarify on Jet open offer.
  • W owner TCNS Clothing plans to scale up India business; getting ready for global show in a year.
  • Canadian smartphone maker BlackBerry Ltd. reported a smaller-than-expected loss.

Source: Economic Times

Friday, 28 March 2014

NEWS WRAP - MARCH 28, 2014

  • Subrata Roy to stay in jail till April 3, Sahara says can't pay Rs. 10,000 crore for bail.
  • StemCyte Inc. to open more umbilical cord blood collection centers in India.
  • CBI files chargesheet against Congress MP Vijay Darda, son in coal scam.
  • Reliance Industries shuts Jamnagar paraxylene unit for 6 weeks for maintenance.
  • General Motors president predicts autonomous cars by 2020.
  • Cox & Kings and Ezeego1.com join hands with G Adventures.
  • Competition Appellate Tribunal dismisses Bhargava's plea against Jet-Etihad deal.
  • Swiss firm Capri-Sun enters India with fruit juices for kids.
  • Tatas, Srei Infrastructure look to sell majority stake in Viom Networks.
  • Park Hyatt Hyderabad owner seeks recast of Rs. 450 crore loan; asks more time for repayment.
  • Drug maker Sun Pharma to buy Standard Chartered's Mumbai Tower for Rs. 280 crore.
  • Ramesh Sanka resigns from DLF; will continue as MD till July 31.
  • Calvin Klein deal to help denim wear maker Arvind rise the market ladder.
Source: Economic Times

LAW LEXICON - The Law Dictionary

  • Notice of Dishonour: Notice given by the holder of a bill of exchange to the drawer when the bill is refused or delayed payment
  • Stare Decisis: Let the decision stand. The policy of courts to abide by or adhere to principles established by decisions in earlier cases
  • Abscond: To hide; withdraw; to depart clandestinely. To go out of the jurisdiction of the courts, or to conceal oneself to avoid legal process.
  • Docket: A list of cases scheduled to be heard in court on a specific day or week
  • Decree: An order that has force of law

Thursday, 27 March 2014

NEWS WRAP - MARCH 27, 2014

  • Supreme Court asks Sahara Group to deposit Rs, 10,000 crore to grant bail to Subrata Roy.
  • Top-deck exit continues at Jet Airways; acting CEO R Gopalakrishnan 3rd one to quit since June.
  • CPI (Consumer Price Index)-linked bond investment limit hiked to Rs. 10 lakh for individuals.
  • Vijay Mallya may be labelled as 'wilful defaulter' by SBI.
  • Companies get relaxation on compliance requirements till September for approval of shareholders through ordinary resolution.
Source: Economic Times

Tuesday, 25 March 2014

NEWS WRAP - MARCH 25, 2014


  • 2G Scam: Supreme Court refuses to cancel Sanjay Chandra's bail.
  • EPFO to provide Permanent Account Number from October this year.
  • Bank of India to sell Rs. 900 crore bad loans to Asset Reconstruction Company.
Source: Economic Times


Monday, 24 March 2014

NEWS WRAP - MARCH 24, 2014


  • FMCG cut down on product launches in 2013 in a tough market.
  • Aditya Birla Private Equity in talks to pick 6% in Adlabs Imagica for Rs 100 crore. 
  • E-filing of I-T returns: Taxpayers to get digital signatures.
  • Tata group firm Titan Co. is looking to increase its size by two-and-a-half times in the jewellery market over the next five years.
  • Tata Motors to invest Rs 1,500 crore on new trucks, buses in Financial Year 2015. 
  • Shoppers stop, Infiniti Chief win accolades at Economic Times Retail Awards.
Source: Economic Times

Saturday, 22 March 2014

NEWS WRAP - MARCH 22, 2014

  • British supermarket giant Tesco announces joint venture with Tata to enter India retail space.
  • Nokia's trouble multiply as Tamil Nadu Govt serves Rs. 2,400 crore tax notice.
  • Government sells 9% stake in Axis Bank, garners over Rs. 5,500 crore.
  • TCS ranked No. 1 employer in Europe.
  • Drug Controller General of India may soon be approving special licences to stem cell operators.
Source: Economic Times

Friday, 21 March 2014

NEWS WRAP - MARCH 21, 2014

  • SUUTI to sell 9% in Axis Bank via block trades, government plans to mop up Rs. 5,500 crore.
  • Infosys co-founder Nandan Nilekani, wife Rohini declare assets worth Rs. 7,700 crore.
  • SpiceJet defends holi jig, denies violating air safety guidelines.
  • NHB likely to raise $200 million from overseas market.
  • Election Commission permits Ministry of Corporate Affairs to notify new company laws operational from April 1, 2014.
  • Pakistan set to import 1,200 MW electricity from India.
  • Starbucks says India operations fastest growing in its history.
  • JLR invests 45 million pounds in a new press line at Halewood plant.
  • PK online plans to raise Rs. 100 crore in first round funding.
Source: Economic Times

Thursday, 20 March 2014

NEWS WRAP - MARCH 20, 2014

  • Indian techies in Silicon Valley turn angel investors for Arvind Kejriwal.
  • Volvo teams up with Bangalore company, SM Kannappa Automobiles to produce buses for emerging markets.
  • Banks to remain open this weekend to facilitate advance tax collection.
  • SAIL's Bhilai Steel Plant conducts hot trials of new Rs. 730 crore sinter plant.
  • RBI allows more private banks to import gold in easing of curbs.
Source: Economic Times

LAW LEXICON - The Law Dictionary

  • Mens Rea: The intention or knowledge of wrong doing that constitutes part of a crime, as opposed to the action or conduct of the accused
  • Ad Curiam: At a Court
  • Pro Bono Publico: For the public good
  • Judgement Creditor: A party to which the debt is owed that has proved the debt in a legal proceeding and that is entitled to use judicial process to collect the debt; the owner of an unsatisfied court decision
  • Judgement Debtor: Any person against whom a decree has been passed

Wednesday, 19 March 2014

NEWS WRAP - MARCH 19, 2014

  • France's Vicat in talks to buy out Sagar Cements' 47% stake for Rs. 4100 crore.
  • RIL reaches to aam aadmi via SMS to counter Kejriwal; urges people to read documents.
  • Dhoni statement against match-fixing is a Rs. 100 crore suit against Zee.
  • Nikon halts D600 camera sales in China after consumer TV show alleged flaws.
Source: Economic Times

Tuesday, 18 March 2014

NEWS WRAP - MARCH 18, 2014

  • Tech Mahindra in talks for offering IT services in Saudi Arabia.
  • Apple likely to cut iPhone 5C price, reduce storage to 8GB.
  • Hinduja brothers among Britain's top 3 richest families.
  • Singapore University confers honorary degree on Ratan Tata.
Source: Economic Times

LAW LEXICON - The Law Dictionary

  • Res sub judice: Matter under consideration
  • Fatum: Beyond human foresight
  • Pro bono: Done for the public good without compensation
  • Ad referendum: For further consideration
  • A fortiori: Much more, much stronger reason

Saturday, 15 March 2014

NEWS WRAP - MARCH 15, 2014

  • Auto companies like Audi India, Mercedes Benz and others hire race and rally drivers as trainers to enhance brand value.
  • ONGC, OIL buy 10% government stake in Indian Oil Corporation.
  • As SpiceJet, IndiGo pull down air fares, uptick seen in travel bookings this summer.
  • Home Ministry's clearances still pending for India heads of Telenor, Sistema, Vodafone.
  • Sanjay Lalbhai-controlled Arvind acquires 49% stake in Calvin Klein India for Rs. 100 crore.
Source: Economic Times

Friday, 14 March 2014

NEWS WRAP - MARCH 14, 2014

  • Gautam Thapar puts Crompton Greaves, the biggest unit of Avantha Powerhouse up for sale.
  • SpiceJet raises Rs. 133.3 crore from promoters over allotment of 6.4 crore warrants.
  • Dr Reddy's lab recalls 58,656 bottles of heartburn drug, Lansoprazole in US.
  • US FDA bans imports from Sun Pharma's Gujarat facility.
  • L&T wins Rs, 3,655 crore mega road project in Qatar.
Source: Economic Times

Thursday, 13 March 2014

SAHARA CASE: AN EYE OPENER

In March 2008, two Sahara Group firms - Sahara Housing Investment Corporation and Sahara India Real Estate Corporation passed a board resolution under the Companies Act to raise funds for acquisition of land, developing townships, residential apartment and shopping complexes etc, through unsecured optionally fully convertible debentures (OFCDs) by way of private placement.

The two companies of the Sahara Group had mobilised a large sum of money (more than 24,000 crore) from over 3 crore investors without complying with SEBI's regulatory framework for public issues. SEBI came to know about such fund raised through an IPO draft red herring prospectus filed by Sahara Prime City Limited with SEBI where it was disclosed that the two firms had issued OFCDs.

SEBI's contention had been that, firstly the entity should be profitable, should have an adequate net worth, and the funds to be raised should be limited to a multiple of the net worth, to ensure that the issuer has the financial strength for prudent use of public money. There have been many emotional pitches by Sahara Group, which claimed to have a net worth of Rs. 68,000 crore and assets worth over Rs. 1.5 lakh crore. One of the Sahara firms was making a loss and the net worth of the other was Rs. 11 lakh. Clearly, neither company had the requisite financial standing to raise thousands of crores of rupees from the public.

Secondly, it was not a private placement as the number of investors was above 50 and that the securities should have been listed. Also, the prospectus floated for the amounts mobilised were scrutinised by SEBI and found to be wanting in terms of adequacy and accuracy of disclosures.

Lastly, the securities market enables the promoters of businesses to raise capital from the public without directly involving them in the business, when the capital needed is spliced into securities of small denominations in which several investor protection in such cases rests on the safeguards created by regulators. SEBI's regulatory framework requires clear accounting of funds, its audit and supervision of end use. It also requires setting up a debenture trustee mechanism if the security represents a borrowing. The Saharas had none of these safeguards.

The Supreme Court ordered and asked the two firms to deposit the money in three instalments beginning with an immediate payment of Rs. 5,120 crore. While the group paid the first instalment, it failed to meet the deadline for other two payments. SEBI began an exercise for refund to genuine investors from the money deposited in the first instalment by the Saharas. However, not much headway appears to have been made in the process as SEBI has detected instances of multiple accounts, on which it has sought a clarity from the Supreme Court.

The high - profile saga saw the arrest of flamboyant Sahara Group Chief Subrata Roy, after the Supreme Court ordered his arrest over delays in repaying thousands of crores of rupees illegally collected from small investors. Roy's jailing is a landmark case, showing that even the most powerful fraudsters will eventually be brought to book.

NEWS WRAP - MARCH 13, 2014

  • SpiceJet signs a deal for 42 Boeing 737 MAX planes worth $4.4 billion.
  • Dubai, Sharjah, Abu Dhabi to stage 16 IPL 7 matches next month.
  • General Insurance Corporation stares at 75 crore claim for missing Malaysian flight.
Source: Economic Times

Wednesday, 12 March 2014

NEWS WRAP - MARCH 12, 2014

  • Quikr raises Rs. 550 crore from group of investors led by Swedish investment company Kinnevik.
  • Jabong teams up with fashion designer Rohit Bal to launch exclusive collection; also to launch 4 in-house brands.
  • Day 1: NHB closes bond issue after over-subscription of 2.08 times.
  • Aishwarya Rai Bachchan and tennis ace Martina Navratilova speak over their achievements to AV Birla group employees.
Source: Economic Times

Tuesday, 11 March 2014

NEWS WRAP - MARCH 11, 2014


  • Darshan Patel, the co-promoter of the erstwhile Paras Pharma, to invest Rs. 150 crore in his new venture Vini Foods over the next two years.
  • Malaysian Air Shares Decline to Record Low After Flight Vanishes.
  • Central Government sees 200 low-cost Airports in two decades to expand connectivity to Tier II and III cities.
  • FDI in Services Sector drops 60% to $1.59 billion during April-October  2013.
  • Trent Hypermarket waits for Joint Venture Nod with TESCO: Noel Tata.
  • By March 10, UIDAI had generated and dispatched unique Aadhaar numbers to 60 crore people.
Source: Economic Times

Saturday, 8 March 2014

NEWS WRAP - MARCH 8, 2014

  • Instagram signs deal, pegged at $100 million, with major ad agency.
  • Former Apple CEO John Sculley to launch smartphone in India; to sell handsets at Rs. 12,000 and less.
  • Ranbaxy Laboratories recalls over 64,000 bottles of generic Lipitor in US.
  • New bank licences in a few weeks: RBI Governor Raghuram Rajan
  • Samsung, Accenture team up for secure mobile platform, apps.
Source: Economic Times

Friday, 7 March 2014

NEWS WRAP - MARCH 7, 2014

  • Bharti Group in talks with with Carrefour, Aeon to form Retail Joint Venture.
  • CIPLA under Income Tax Authorities' scanner for alleged Tax Evasion.
  • BSE SME Exchange hits half-century, taking its Market Capitalization to over Rs. 3000 crore.
  • Mafatlal Industries to invest Rs. 200 crore more in Gujarat Units.
  • Private Gear Maker Alstom bags Rs. 85 million euro Contract from BHEL.
  • Vedanta appoints ex-Rio Tinto chief Tom Albanese as next CEO.
  • Birla Group seeks partner for Health Insurance foray.
  • Google and Walt Disney's Foreign Investment proposals  have received the go-ahead by FIPB.
Source: Economic Times

Thursday, 6 March 2014

FII/QFI INVESTMENTS IN COMMERCIAL PAPERS

ISSUING AUTHORITY : SECURITIES AND EXCHANGE BOARD OF INDIA
DATE OF ISSUE : 14/02/2014
EFFECTIVE DATE : IMMEDIATE EFFECT
CIRCULAR NO. CIR/IMD/FIIC/4/2014


The limit for investment by SEBI registered FIIs, QFIs and long term Investors in Corporate Debt stood at USD 51 billion. Out of the above limit of USD 51 billion, a sub-limit of USD 3.5 billion was available for investment by eligible investors in Commercial Paper (CP). 
Thus, to encourage long term investors, it has been decided, to reduce, with immediate effect, the existing Commercial Paper sub-limit of USD 3.5 billion by USD 1.5 billion to USD 2 billion. The balance USD 1.5 billion shall, however, continue to be part of the total Corporate debt limit of USD 51 billion and will be available to eligible foreign investors for investment in Corporate debt.
For detailed Circular, please find the link below:

NEWS WRAP - MARCH 6, 2014

  • Anil Ambani-led Reliance Infrastructure has filed a Rs 100-crore defamation suit against the Aam Aadmi Party in the Bombay High Court.
  • Bharti Airtel, Kenya’s telco Safaricom bid for licences and 2.7 million customers of Yumobile.
  • Vodafone gets nod to merge its India units; riders attached could stymie move, say observers.
Source: Economic Times

Wednesday, 5 March 2014

NEWS WRAP - MARCH 5, 2014

  • New office bearers selected for CII Central Gujarat Zonal Council for the year 2014-15.
  • Paarth Infrabuild will invest Rs. 650 crore over next four years in Green Building in Lucknow.
  • Walmart to expand in e-retailing in India, planning marketplace model akin to Amazon, eBay.
  • GMR Group forays into Railway Sector, bags first order worth Rs. 267 Crores.
  • Novartis may be fined for submitting 'fake' document to Drug Controller General of India.
  • Tata Communications may sell Neotel in South Africa to Vodacom, Stock gains 4%.
Source: Economic Times

Tuesday, 4 March 2014

NEWS WRAP - MARCH 4, 2014

  • RBI grants additional 9 months to swap notes printed before 2005.
  • Stock Broker Ketan Parekh sentenced to two years rigorous imprisonment by CBI Court.
  • Hindustan Unilever becomes the most preferred employer for B-school graduates once again.
  • Lenovo to launch Ashton Kutcher-designed smartphones this year.
  • Sweet! Bio-batteries that run on sugar to power smartphones for 10 days.
  • Indian Banks are increasingly seeking Insurance Cover against fraudulent online transactions.
Source: Economic Times

Monday, 3 March 2014

THE CORPORATE SOCIAL RESPONSIBILITY (POLICY) RULES, 2014

Ministry of Corporate Affairs, Government of India on 27th February, 2014 announced the Corporate Social Responsibility (Policy) Rules 2014 under Section 135 of the new Companies Act 2013. Section 135 pertains to spending for the purpose of Corporate Social Responsibility by companies.

A FORMAL FRAMEWORK FOR SOCIAL SPENDING BY CORPORATES

Effective from - April 1, 2014

How Much?

2% of Average Profit of previous three years.

(Profits from overseas branches and dividends from other Companies not included in Net Profit for calculation).

Who?
  • Companies with Net Worth of Rs. 500 crore or Turnover of over Rs. 1,000 crore or Net Profit of over Rs. 5 crore.
  • Foreign Companies registered in India.
What all? 

There are many new additions when compared to the CSR Activities that enlists in the Schedule VI of the Act, which are as follows:
  • Livelihood
  • Enhancement and rural development projects
  • Measures for benefit of armed forces, veterans, war-widows and their dependents.
  • Working towards protection of National Heritage, Art & Culture.
  • Reducing inequalities faced by socially & economically backwards.
  • Protection of Flora & Fauna, animal welfare, agro-forestry, etc.
Where?

CSR Activities will have to be within India.

How?

Company's Board will decide in accordance with its CSR Policy and the decision of its CSR Committee.

Do's & Don'ts
  • Surplus from CSR cannot be included in Profit.
  • CSR work can be done through a registered Trust or Society or a separate Company.
  • Companies can collaborate with other Companies but will have to report separately.
One major addition in Section 135 is provision of upto 5% of the CSR budget for training and capacity building of employees and implementing partners for CSR.

Composition of CSR Committee


Every Company including its Holding or Subsidiary, and a Foreign Company having its branch office or project office in India which fulfills the quoted applicability criteria.



Who shall not be required to constitute the CSR Committee?

Every Company which ceases to be a Company quoted under the applicability criteria for three consecutive financial years.

CSR Committees


(i) An unlisted Public Company or a Private Company covered which is not required to appoint an Independent Director - Shall have its CSR Committee without such Director.

(ii) A Private Company - Having only two directors on its Board  shall constitute its CSR Committee with two such Directors.

(iii) With respect to Foreign Company - Shall comprise of at least two Persons* of which one person shall be nominated by the Foreign Company.

*Person under section 380(1)(d) of the Companies Act, 2013 means - The name and address or the names and addresses of one or more persons resident in India authorised to accept on behalf of the company service of process and any notices or other documents required to be served on the company.

CSR Reporting

An emphasis is given to disclose the CSR expenditure. The Board will have to include an Annual Report on CSR from 2014-2015 on wards.

In case of Foreign Company - Balance Sheet shall contain an Annexure regarding report on CSR.

Display of CSR activities on its website

Following the Board's Approval, the CSR Policy will have to be disclosed on the Company's website.

NEWS WRAP - MARCH 3, 2014

  • Telecom Commission to soon clear Rs 7,103-crore project for mobile connectivity in border areas.
  • Mark Zuckerberg's fortune grows by a massive $15 billion in less than 2 years as Facebook shares soar.
  • Being Human: Salman Khan’s apparel brand raked up sales of Rs 179 crore in its first year.
  • Department of Industrial Policy & Promotion (DIPP) has proposed 100% FDI through Automatic Route in the cash-starved Railway Sector.

Source: Economic Times

Saturday, 1 March 2014

NEWS WRAP - MARCH 1, 2014

  • US advocacy group slams move to blacklist India as a "priority foreign country" in trade feud.
  • Facebook, Skype challenge telcos' free cash flows: Fitch
  • Government to take over KG-D6 block if Reliance Industries shuts down production.
  • Vodafone conciliation decision after transfer pricing row ends.
Source: Economic Times

Friday, 28 February 2014

NEWS WRAP - FEBRUARY 28, 2014

  • Infrastructure company Ramky Infrastructure in talks to raise Rs. 900 crore from assets sale.
  • Tata Motors to set up Jaguar and Land Rover plant in Saudi Arabia.
  • Nigeria fines mobile firms MTN, Airtel and Globacom a combined $4 million for poor service.
  • EBay founder rejects Carl Icahn's call for PayPal spin-off.
  • No money for Kingfisher Airlines revival; Vijay Mallya pays over Rs. 4 crore for race horse 'Air Support'. 
Source: Economic Times

Thursday, 27 February 2014

NEWS WRAP - FEBRUARY 27, 2014

  • Coal India and its largest customer NTPC spar over Rs. 3,000 crore arrear settlement.
  • India, Dubai agree to increase bilateral airline seat entitlements by little over 20%.
  • Most Infosys staff to get 5-7% hike; seniors, onsite being finalized.
  • Anand Mahindra's $1 million challenge to solve traffic stress and electricity shortage awaits desi innovators.
Source: Economic Times

Wednesday, 26 February 2014

NEWS WRAP - FEBRUARY 26, 2014

  • Nasa to launch water-related satellite in collaboration with Isro.
  • India to block US trade probes, ready for fight at WTO.
  • No railway refund for non-travellers from March 1.
  • Tata Global Beverages gets bourses' nod to merge Mount Everest Mineral Water.
  • Swarovski to launch products specifically designed for India.
Source: Economic Times

Tuesday, 25 February 2014

NEWS WRAP - FEBRUARY 25, 2014

  • IT majors TCS, Infosys, Wipro and Cognizant focus on digital services to create business solutions.
  • Small companies market themselves on Facebook and seal deals via WhatsApp.
  • Corporation Bank in pact with Tata Motors to finance commercial vehicles.
  • Pfizer to buy stake in two foreign units; shares rally.
  • Ranbaxy Laboratories suspends drug ingredients shipment from 2 plants.
Source: Economic Times

Monday, 24 February 2014

NEWS WRAP - FEBRUARY 24, 2014

  • India to adopt global financial standards from April 2015.
  • Honda plans India R&D unit with initial investment of Rs. 500 crore to develop affordable cars. 
  • Emirates set to get more flying rights with additional 10,000 seats a week.
  • SpiceJet sparks off third fare war of the year; opens three day window to offer 75% off on base fare.
Source: Economic Times

Saturday, 22 February 2014

NEWS WRAP - FEBRUARY 22, 2014

  • Oil Ministry falters over price hike nod to Reliance post FIR.
  • Honda considers opening board to foreigners.
  • Videocon Group firm to set up Rs. 1,000 crore plant in Tamil Nadu.
  • Vodafone gives new arbitration notice; challenges right to slap Rs. 20,000 crore retro tax demand.
  • Steve Jobs, Snoopy, John Lennon to grace US stamps.
Source: Economic Times

Friday, 21 February 2014

NEWS WRAP - FEBRUARY 21, 2014

  • WhatsApp, BBM, FB chat under Sebi lens for being used to spread price-sensitive information.
  • With Dell's PowerEdge servers, Flipkart leads India's e-commerce transformation.
  • Bespoke suit makers, scotch brands join hands to woo rich Indian clients.
Source: Economic Times

Thursday, 20 February 2014

NEWS WRAP - FEBRUARY 20, 2014

  • CCI rules out unfair trade practices by Religare group firms.
  • ITC to take on Nestle, PepsiCo, Amul and HUL with dairy products and non-carbonated drinks.
  • Lotte India Corporation Ltd. to invest Rs. 300 crore in Haryana.
  • Government likely to increase and merge dearness allowance with basic pay.
  • Singapore's Jungle Ventures invest Rs. 7.3 crore in Crayon Data.
  • Facebook to buy WhatsApp message service for $19 million.
Source: Economic Times

Wednesday, 19 February 2014

NEWS WRAP - FEBRUARY 19, 2014

  • New Silk Route gets ready to sell Destimoney for Rs. 1,200 crore.
  • Mumbai builder Lodha Group buys second building on Carey Street in London for Rs. 1,000 crore after MacDonald House.
  • 14 more coal block licences of companies like ArcelorMittal, Hindalco, Tata Power, Reliance Energy cancelled.
  • 47 Taiwanese electronics firms to set up shop cluster in Bangalore.
  • Kiran Mazumdar-Shaw succeeds Mukesh Ambani as Chairperson of IIM-B board.
Source: Economic Times

Tuesday, 18 February 2014

NEWS WRAP - FEBRUARY 18, 2014

  • Centre takes back 10 coal blocks from firms like Jindal Steel, Tatas, Adani.
  • Amazon to use own logistics network for product delivery in 2 years.
  • Vote on Account 2014: Cars, two-wheelers, TVs, computers, refrigerators set to be cheaper.
  • Bangladesh inks hydrocarbon exploration deals with Oil India, ONGC.
  • Actavis Plc in talks to but Forest Laboratories Inc for upto $25 billion.
Source: Economic Times

Monday, 17 February 2014

NEWS WRAP - FEBRUARY 17, 2014

  • Airtel to announce Rs. 700 crore Loop Telecom deal soon via slump sale.
  • Mukesh Ambani's son Akash being mentored to join Reliance.
  • Manpasand Beverages Private Limited to invest Rs. 100 crore to raise sales to Rs. 1,000 crore.
Source: Economic Times

Saturday, 15 February 2014

GLOBAL TAX FREE TRADERS (INFORMANT) VS. WILLIAM GRANT & SONS (DEFENDANT)

Applicable Act: The Competition Act, 2002 (The Act)

ALLEGATIONS

A complaint filed by the Informant alleged that the firms had imposed exorbitant, unfair and discriminatory prices which were possible only due to the dominant position enjoyed by them in the liquor market in the country.

BRIEF OF FACTS

The Defendant, headquartered in the United Kingdom is engaged in the production, sale, marketing and distribution of spirit. It offers scotch whisky, single malts, handcrafted single malts, gin and other spirit. The Informant is an exclusive distributor of the Defendant.

It was alleged that the Defendant permitted import of their products into India through a number of entities such as Delhi Duty Free Services and other private companies, at prices much lower than those charged from the Informant. 
CCI noted that the firms which were the third largest producer of  'scotch whiskey' had around 10 percent market share after Diageo and Pernod Richard in the world. For the Indian market, CCI noted that United Spirits Ltd. (USL) held more than 50 percent of the market share in whiskeys followed by various other alcoholic beverages manufacturing companies. The percentage of imported liquor in India is very minimal, around 3 percent. 

CONCLUSION

Therefore, considering the above scenario, the CCI concluded that the Defendant were not dominant in any of the alternative relevant market definitions and therefore the issue of abuse would not arise.

DECISION

The fair trade regulator Competition Commission of India (CCI) dismissed charges of abuse of dominant position under Section 4 of the Act against the Defendant's three group firms with respect to purchase and sale of liquor in India.

NEWS WRAP - FEBRUARY 15, 2014

  • Egypt two-wheeler import ban likely to hit Bajaj Auto hard.
  • Sugar, soya oil may join Commodity Transaction Charge (CTT) negative list.
  • ACC enters brick segment with Bengal plant to make Fly Ash brick units.
  • Nissan ends sales, marketing pact with Hover Automotive ahead of Datsun launch.
  • CCI rules out abuse of dominance against William Grant & Sons with respect to purchase and sale of liquor in India.
Source: Economic Times

SEBI CLEARS NEW CORPORATE GOVERNANCE NORMS

To exhort listed companies and their top executives to follow 'good business practices', market regulator Sebi cleared new corporate governance norms which shall be effective from October 1, 2014. These new norms will be incorporated in the listing agreement also. Following are the new rules disclosed:
  • The new rules exclude Nominee Director from the definition of Independent Director. 
  • Sebi has restricted the tenure of Independent Directors to 2 to 5-year terms. Directors nominated by the company's promoter cannot be classified as an independent director. An Independent Director has a maximum term of 5 years extendable by another 5 years subject to a special resolution.
  • It is mandatory for the listed companies to disclose remuneration policies of CEO and Executive Directors, Related-Party Transactions (RPTs) and appointment and resignations of Independent Directors.
  • Mandatory constitution of Nomination and Remuneration Committee. Chairman of the said committee should be independent. 
  • Separate meetings of the Independent Directors should be held.
  • A person cannot be an Independent Director in more than 7 companies and 3 in case the person is serving as a Whole Time Director and cannot accept stock option plans.
  • It is mandatory for the companies to have an orderly succession plan for appointments to the board and senior management, a whistle blowing policy and to appoint at least 1 woman director on its board, besides empowering minority shareholders to approve related-party transactions.
  • The minimum capital requirement of an asset management company has been increased from Rs. 10 crore to Rs. 50 crore.
  • Get public shareholder's nod for RPTs and carry out performance evaluation of all directors. The constitution of a Stakeholders Relationship Committee has been made mandatory.
  • The role of Audit Committee has been expanded to its prior approval for all RPTs by shareholders through special resolution with related parties abstaining from voting.
  • The scope of the definition of RPT has been widened to include elements of Companies Act and Accounting Standards.

Friday, 14 February 2014

NEWS WRAP - FEBRUARY 14, 2014

  • Ministry of Rural Development demands Rs. 1,000 crore more for socio economic and caste census.
  • Sebi clears new corporate governance norms, mutual fund policy.
  • Gas price FIR: RIL weighs legal options, might go for defamation suit.
Source: Economic Times

Thursday, 13 February 2014

NEWS WRAP - FEBRUARY 13, 2014

  • Panasonic files plea for single-brand application to become the first global electronics brand to open company-owned outlets.
  • AstraZeneca to shut Bangalore R&D site; to impact 170 jobs.
  • Tea Board invites Expressions of Interest (EoI) from private parties for setting up Tea Park in Kolkata.
  • IPL7 Auction: Yuvraj joins RCB for a staggering Rs. 14 crore, Karthik at Delhi for Rs. 12.5 crore.
Source: Economic Times

UNITED STATES DRAGS INDIA TO WTO ON SOLAR MISSION PROGRAMME

India in 2010 launched Jawaharlal Nehru National Solar Mission. It aims to have 20,000 MW of grid-connected solar power by 2022. The US already had consultations with India on solar domestic content for the phase-I of the programme. Dismissing the allegations, India said its National Solar Mission programme is WTO-compliant and it would defend its stand in the Geneva-based multilateral body. 

The US has challenged that the domestic content requirements discriminate against US exports by requiring solar power developers to use India-manufactured equipment instead of US equipment and that these requirements are against WTO rules.The US added that solar power developers receive certain benefits and advantages, such as long-term tariffs for electricity, contingent on their purchase and use of solar cells and solar modules of domestic origin.

Commerce Secretary Rajeev Kher pointed out that several US companies have won contracts in phase-II of India's National Solar Mission. He further added that US solar and renewable energy projects are protectionist in nature.

"The claim states that India provides less favorable treatment to imported solar cells and solar modules that accorded to like products originated in India and they are trade-related investment measures inconsistent with India's obligations under the GATT," according to the WTO.

A request for consultations is the first step in the WTO dispute settlement process and is intended to help parties find a solution. If the matter is not resolved through consultations within 60 days of the request, the US may ask WTO to establish a dispute settlement panel.

DONATE TO A POLITICAL PARTY TO SAVE TAX

It is the height of election season, and campaign spending is setting new records. Many political parties are going all out to avail donations to fill their pockets. But breaking the traditions, parties are also focusing on individuals to mop up finance. Some parties are promoting their online donation platforms in the run-up to the polls, highlighting the tax deduction for contributing to political parties.

Election funding can reap some smart tax saving with 100% tax deduction for donation to political parties. The entire amount donated by an individual to a recognized political party is allowed as deduction under Section 80GGC of the Income Tax Act, 1961 while computing his/her gross total income. 

Following parameters should be kept in mind for availing deduction under the said section:
  • Donations made in cash are not eligible for tax deduction. In short, make the payments through banking channels - cheques, demand drafts, credit or debit cards and internet banking.
  • Another condition is that donation should be made to a political party registered under Section 29A of the Representation of the People Act, 1951.
While there is no cap on the claim amount as a deduction for such donations, there is an overall limit on total deductions. This exemption is part of Chapter VI-A deductions. And under the law, the total deductions under the said Chapter cannot exceed the gross income. The employees will have to claim a refund at the time of filing their Income Tax Returns. 

Wednesday, 12 February 2014

NEWS WRAP - FEBRUARY 12, 2014

  • Gas price row: Delhi CM Kejriwal orders Anti Corruption Branch to file FIR against Mukesh Ambani, minister Veerappa Moily.
  • Skoda plans sub-four-meter compact sedan for India to tap the upwardly mobile.
  • Abhishek Bachchan named ambassador of 'END7' Campaign to spread awareness on tropical disease.
  • Banking expansion may create up to 20 lakh jobs in 5-10 years.
  • Donation to a political party via cheque, credit/debit card or net banking can be claimed as deduction under section 80GGC.
  • Loopholes in Rural Electrification Plan resulted in cost escalation of Rs. 696 crore.
  • Solar plan: US drags India to WTO, India to defend local content policy.
Source: Economic Times

Tuesday, 11 February 2014

NEWS WRAP - FEBRUARY 11, 2014

  • Labour Bureau to revise outdated wage, price indices.
  • Soha Ali Khan joins hand with P&G's flagship Corporate Social Responsibility program P&G Shiksha headquartered at Gujarat.
  • Infibeam taking cloud platform BuildaBazaar, aimed at bringing offline retailers online, overseas.
  • Zydex Nanotechnology comes up with a solution for moisture-resistant and long-lasting roads.
  • PE firms General Atlantic Partners, Baring Asia, Actis, Apax negotiate for a large stake in CARE.
  • India the largest market of Truecaller application with 22 million users.
Source: Economic Times

Monday, 10 February 2014

NEWS WRAP - FEBRUARY 10, 2014

  • DLF sells Aman Resorts to its founder Adrian Zecha for Rs. 1,600 crore.
  • DCGI asks Novartis to seek 'violations' in papers on drug manufacture.
  • Labour Ministry asks EPFO to provide permanent PF account number soon.
  • Finance Ministry clears 9 Foreign Investment proposals worth Rs. 798.73 crore approved.
  • Government imposes ban on Reliance's retail LPG sales over violation of LPG control order.
Source: Economic Times

LAW LEXICON - The Law Dictionary

  • Contemporanea expositio est optima et fortissima lege: A contemporaneous exposition or language is the best and strongest in Law
  • Delegate potestas non-potest delegari: A delegated power cannot be delegated further
  • Ipso facto: By the very nature of the case
  • Amicus curiae: A friend of Court
  • Travaux preparatotries: Preparatory records

Saturday, 8 February 2014

NEWS WRAP - FEBRUARY 8, 2014

  • Ambuja Cements, ACC to see top-level rejig with MDs of both companies offering to resign.
  • Damodar Valley Corporation to move to Supreme Court against Reliance discom over Rs. 900 crore unpaid dues.
  • Apple-Bitcoin rift has currency's enthusiasts ditching iPhones.
  • 1 billion plastic notes of Rs. 10 denomination to be introduced later this year on a field trial basis.
  • ICICI-led infradebt fund inks Rs. 50 crore loan pact for road project promoted by Jaypee Group.
  • Toyota close to $1 billion deal to settle US probe: Report
Source: Economic Times

Friday, 7 February 2014

CHARAK PHARMACEUTICALS (INFORMANT) VS. GLENMARK PHARMACEUTICALS (DEFENDANT)


ALLEGATIONS

The Informant alleged that the mark adopted by the Defendant is phonetically and structurally deceptively similar to that of the mark of the Informant and was likely to create confusion in the minds of the consumers.

BRIEF OF FACTS

The Informant started making the drug 'Evanova' from April 2002 in the form of capsules for the treatment of menopause while the Defendant had in May 2006 applied for registration of its mark 'Econova' used in probiotic capsules for the treatment of bacterial vaginosis.

According to the Informant, it learned about the illegal activities of the Defendant of infringement of the Informant's registered trademark 'Evanova' and of passing off their product as that of the Informant's. The Informant contended that the products of both the parties dealt in the same area, the standard of scrutiny would have to reckon whether there was phonetical and structural similarity and whether they were likely to create any confusion in the minds of men of ordinary intelligence. The Court should note similarities of the two marks and not decide on the basis of dis-similarities.

The Defendant argued that its mark was aurally, structurally and visually different and dis-similar to that of the mark of the Informant's. Moreover, the product of the Defendant was available only against prescription and not Over The Counter (OTC) as in the case of Informant. It further contended that since May 2006, the company had been extensively using the said trademark and enjoyed immense reputation and goodwill of its own. For these reasons, the Defendant asserted that there is no similarity in the two marks.

CONCLUSION

The Bombay High Court Judge said that he was prima facie satisfied that the Defendant's mark 'Econova' was deceptively similar to the Informant's mark 'Evanova'. He further added that both the products were entirely different and if, as a result of the confusion, the wrong drug was administered, it would lead to disastrous consequences.

DECISION

The Bombay High Court has granted relief to the Informant, directing the Defendant to rename its drug 'Econova' since its name is deceptively similar.

NEWS WRAP - FEBRUARY 7, 2014

  • Vodafone India's Rs. 10,141 crore FDI proposal cleared by Cabinet.
  • Charak Pharmaceuticals wins case agains Glenmark over drug name.
  • KKR investing $100 million in Gautam Thapar's Avantha Group.
  • Viacom18 to launch indie music channel in mid-Feb with PepsiCo as anchor advertiser.
  • Huawei faces inter-ministerial probe on BSNL hacking charges.
  • Jubilant group considers sale of its chemical business to reduce debt.
  • Henkel bet turns glorious for Jyothy Labs.
  • BOSCH gets the first investment approval under MSIPS for Rs. 436 crore.
Source: Economic Times

Thursday, 6 February 2014

NEWS WRAP - FEBRUARY 6, 2014

  • India to extend visa-on-arrival facility to tourists from 180 nations.
  • After snapping up $50 million, Myntra is now in talks to raise $40 million more.
  • Government plans new car safety norms in 3 months after some cars failed safety tests in Europe.
  • Vikram Bakshi gearing up for legal battle against McDonald's; sells assets to create fund.
  • Jabong to hike up its funds for $100 million.
  • Microsoft ties up with Tata Tele, MBD and Acer to bundle content for schools.
Source: Economic Times

Wednesday, 5 February 2014

INTEREST RATES ON FCNR (B) DEPOSITS

ISSUING AUTHORITY : RESERVE BANK OF INDIA
DATE OF ISSUE : 31/01/2014
EFFECTIVE DATE : 01/03/2014
CIRCULAR NO. RBI/2013-14/477

In exercise of the powers conferred by Section 35A of the Banking Regulation Act, 1949, following changes in the interest rates on FCNR (B) deposits will be exercised with effect from March 1, 2014.

MATURITY PERIOD
EXISTING
WITH EFFECT FROM MARCH 1, 2014
1 year to less than 3 years

LIBOR/SWAP plus 200 basis points
No change

3 - 5 years

LIBOR/SWAP plus 400 basis points

LIBOR/SWAP plus 300 basis points


The interest rates mentioned vide Circular dated August 14, 2013 shall be applicable till February 28, 2014.

For detailed Circular, follow the Link below:
RBI/2013-14/477