India on road to ‘car registration portability’

Source: The Hindu Business Line, May 21, 2019

New Delhi: Owners of cars or other vehicles relocating from one State to another will be spared the tedium of re-registering their vehicles and changing the vehicle number plates, if a planned move of the Road Ministry takes off. The proposed policy is still in the idea stage and was discussed at the Group of Transport Ministers meeting a few months ago, according to an official.

To get around this, the Road Transport Ministry had written to all the State governments with a suggestion to introduce a common tax regime across States based on the price of cars. Currently, car buyers tend to flock to States that offer lower tax rates, which make for cheaper cars. If implemented, this will enable number portability of vehicles across regions.

Another line of thought in the government is to allow seamless transfer of relatively older vehicles – those that have completed a few years. This means relatively older vehicles will not require a re-registration and related paperwork when used in a different State. This would, to some extent, separate the genuine buyers from those looking to “manage addresses” in their hunt for a cheaper vehicle. Read the rest of this entry »

FSSAI allows small organic growers to sell produce without certification till 2020

Source: ETRetail.com, May 20, 2019

New Delhi: Food safety regulator FSSAI has permitted small organic producers, having an annual turnover of over Rs 12 lakh, to sell their produce directly to end consumers without certification till April 2020, but will not be able to use ‘Jaivik Bharat logo’ on their products, a latest report says. The Jaivik Bharat logo is an identity mark to distinguish organic products from non-organic ones.

A similar relaxation has been given to ‘aggregators’ having an annual turnover of Rs 50 lakh. However, the organic food retail firms have to comply with the certification norm.

Under the 2017 organic regulation, sale of organic produce directly to end consumer has been allowed only with the certification of the National Program for Organic Production (NPOP) and Participatory Guarantee System (PGS) India. Read the rest of this entry »

CBDT allows AMCs to directly manage offshore funds out of India

Source: The Hindu Business Line, May 19, 2019

New Delhi: Asset management companies (AMCs) can now graduate from being mere ‘advisors’ to offshore funds to becoming a direct, “full fledged manager” of such funds out of India. This comes after the Central Board of Direct Taxes (CBDT) removed a taxation related constraint that prevented Indian AMCs from taking up direct fund management activity for the offshore funds.

The CBDT has clarified that SEBI-approved asset management companies will be designated as ‘eligible fund manager’ and therefore entitled for benefits under Section 9A of the income tax law. This would mean that fund management activities carried for offshore funds by such AMCs would not be regarded as having a ‘business connection’ and would not result in a taxable presence of such offshore funds in India.

Even if the overseas fund is managed by AMCs from India there will be no adverse tax consequences for the overseas funds here. Hence, their global incomes will not be subjected to tax in India. Read the rest of this entry »

Handicraft exporters to Iran breathe easy as govt drops documentation requirement for export sop

Source: The Hindu Business Line, May 16, 2019

New Delhi: Handicraft exporters to Iran have got a shot in the arm with the government acceding to their long-pending demand to do away with the requirement for e-BRC (Bank Realisation Certificate) to get benefits under a popular export promotion scheme as banks were not being able to generate the documents for countries in the Office of Foreign Assets Control (OFAC) list.

OFAC countries are the ones against which economic sanctions have been imposed by the US and include Iran, Iraq, North Korea, Belarus, Syria and Cuba. Read the rest of this entry »

Govt amends rules related to incorporation of cos to ensure transparency

Source: Business Standard, May 15, 2019

New Delhi: The corporate affairs ministry has amended the rules pertaining to incorporation of companies to provide more clarity and uniformity in choosing names for the companies, according to an official.

The ministry has brought in amendments to the Companies (lncorporation) Rules, 2014.

The move also comes against the backdrop of instances where applications by companies for registering their names have been rejected due to various reasons, including trademark issues and proposed names being too general.

The official said the changes have been made to ensure more clarity, uniformity and transparency in approving the names for companies at the time of incorporation.

He also noted that the rules have been updated so that there is clarity for people to apply as well as for officers to process the requests properly.

Among others, the ministry has now provided illustrations regarding applicability of various names.

A liberal competition law in the works to facilitate M&As

Source: The Economic Times, May 14, 2019

New Delhi: India is looking to introduce a more liberal competition law to facilitate mergers and acquisitions and a revamp of the limited liability partnership (LLP) framework, a senior government official told ET.

These changes are to be part of the corporate affairs ministry’s agenda for the first 100 days of the next government. Also on the anvil are a formal mediation and conciliation mechanism under the Insolvency and Bankruptcy Code (IBC) and know-your-customer (KYC) norms for professionals such as chartered accountants and company secretaries.

“There are a number of things lined up,” the official said.

The conciliation process will allow for a window before a company is taken to bankruptcy court.

“We will look at a very strong concept of mediation and conciliation in the IBC because that’s very critical,” said the official. He pointed out that India follows the cash-flow test and not the balance-sheet test.

That means even a temporary liquidity hiccup can force a company into the insolvency process. Read the rest of this entry »

Independent directors face mandatory e-registration

Source: The Economic Times, May 08, 2019

NEW DELHI: All independent directors may have to register as part of a new initiative by the ministry of corporate affairs (MCA), which also plans to introduce online training modules on various issues that these board members deal with. While registration is proposed to be made mandatory through an online facility, the training through electronic modules, that are being prepared by Indian Institute of Corporate Affairs, will be purely voluntary.

The registration process will be in addition to the Directors Identification Number, where a KYC process was recently undertaken. Sources told TOI that a corporate boss or a promoter, who may be an executive director on the board, will also have to register if he or she is an independent director on the board of another company. Read the rest of this entry »