CA Online

Sebi asks exchanges to frame new outsourcing policy The Securities and Exchange Board of India (Sebi) has asked stock exchanges and clearing corporations  to prepare a framework for appointing of third-party vendors. The market regulator has directed the  so-called market infrastructure institutions to not outsource core and critical operations such as  trading information, infrastructure and surveillance. Industry players say the move will help in better risk management and safeguard the markets and  investors from unforeseen risks. There have been instances in the past where the promoter of an exchange has also acted as a service  provider, potentially creating a conflict of interest situation. Although the regulator has allowed the exchanges and clearing corporations to outsource activities to  associate or group companies, it has asked for a clear demarcation of such dealings and an arm's- length relationship. Sebi has also allowed outsourcing of certain core activi

States not releasing duty drawback refund: Exporters State governments have effectively stopped paying tax refunds under the duty drawback scheme,  compounding problems of exporters. Exporters alleged that since the goods and services tax (GST) was introduced, refunds for the state  component of taxes had dried up under the duty drawback scheme because the requisite mechanism was not  in place. “While it is still possible to get states to pay their share of refunds under the integrated GST,  refunds to be paid fully by them are not materialising,” said Ajay Sahai, directorgeneral of the  Federation of Indian Export Organisations. The problem was spread across the country, he added. The duty drawback scheme seeks to rebate duty on any imported or excisable material and service used  in the manufacture of goods for export. Customs, excise and service tax in respect of inputs are neutralised under the scheme. The Central Board of Excise and Customs, which administers the s

Time-bound listing plan fails to take off The ‘ time-bound listing’ for public sector undertakings (PSUs), announced in this year’s Union  Budget, isn’t being met. A state- owned unit was to list within 165 days after its initial public offer of equity (IPO) got  approval by its parent ministry or department and by the department of investment and public asset  management (Dipam). The idea was to help the Centre with its ambitious disinvestment target of over Rs 70,000 crore for the  current financial year. However, PSUs have repeatedly missed the schedule set under the guidelines,  which had deadlines for each task in the IPO process. Examples are General Insurance Corporation (GIC  Re), New India Assurance, IRCTC and Ircon. For instance, the Centre had allowed 90 days for the company to file an offer document with market  regulator Sebi, from the day of board authorisation for the IPO. Within this period, 45 days were  allotted for investment bankers to do the duediligence

Delhi HC allows exporter to import without paying IGST The Delhi High Court has granted interim relief for an exporter, to import goods without payment of  the integrated goods and services tax (IGST) to the extent allowed by advance authorisations received  by him prior to July 1, when GST was enforced. Advance authorisation is issued for exporters to allow dutyfree import of inputs which are physically  incorporated in export products. The relief given relates to export orders placed on the petitioner, an exporter of plastic products,  before July 1. The next hearing in this case is on February 22. Prior to GST, import under the Advance Authorisation Scheme was exempt from payment of basic Customs  duty, additional Customs duty, education cess, etc.Amajor change since July 1 is additional levy of  IGST. While upfront exemption is extended to basic Customs duty, exporters are required to pay IGST on  import and central, state or Union Territory GST (as the case applicable)

GST: Centre sets up committee to receive profiteering complaints A four member standing committee, comprising tax officials of the Centre and states, has been set up to  receive complaints of undue profiteering by any entity under the new goods and services tax (GST)  regime. The standing committee on antiprofiteering will act asacomplaint processing machinery and will refer  any cases it finds fit for investigation to the Directorate General of Safeguards (DGS). The setting up of the panel, with two officials of the Central Board of Excise and Customs (CBEC) and  one each from Delhi and Haryana tax department, sets in motion the antiprofiteering clause under the  GST. CBEC officials Himanshu Gupta, Principal Commissioner, GST Delhi andOPDadhich, principal, commissioner  Customs (preventive) Delhi, as alsoHRajesh Prasad, commissioner (sales tax), Delhi, and Ashima Brar,  excise and taxation commissioner, Haryana, are members of the committee, according to an official  order.