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FDI consolidated policy includes startups, allows 100% FVCI India unveiled a new foreign direct investment policy framework that for the first time  comprises provisions specific to startups, a sector that is top on the government’s  agenda.  The 2017 FDI policy circular lists startups as a separate section and spells out  provisions that allow them to raise foreign money from venture capital funds and other  investors through instruments such as convertible notes.  They can issue equity or equitylinked instruments to foreign venture capital (VC)  investors, says the circular, the first issued after the abolition of the Foreign  Investment Promotion Board (FIPB).  The Department of Industrial Policy and Promotion (DIPP) released the rules on Monday with  immediate effect.  Foreign residents, except those in Pakistan and Bangladesh, will be permitted to purchase  convertible notes issued by an Indian startup for Rs 2...

Cos Fear Losing Credit Over GST Filing Errors Industry bats for extension of filing deadline citing delay in getting offline utility A company with Rs.100 crore credit in lieu of taxes paid in the past regime, risks losing it now under the goods and services tax (GST) reign simply because of the `fat finger,' as it is popularly called. With the August 28 (Monday) deadline looming for filing returns and ensuring GST compliance, corporates are a deeply concerned lot. The offline utility for GST TRAN 1 form to be used to claim input tax credit for the pre-GST regime -was not available till Sunday , leaving just a day for filing returns and causing a weekend rush. In absence of the utility, details had to be filed online with higher chances of error. Tax practioners struggled to meet the deadline, having had to deploy additional manpower to manually key in invoices, some running into thousands. What has compounded the industry's worry is that there is no clarity on whet...

Sebi May Bring Rules for Merger of MF Schemes Move expected to improve transparency and reduce confusion for MF investors India's capital markets regulator intends to introduce rules that will force mutual funds to merge schemes in the same investment categories, driving long-pending consolidation in an industry that has hitherto ignored informal requests for ending the surfeit of plans.   Broadly put, if a mutual fund has two equity schemes with mandates to invest in large-cap stocks, the asset manager will have to merge the investment products once the new rules proposed by the Securities and Exchange Board of India (Sebi) kick in. The step is aimed at improving transparency and reducing the clutter for investors.   The Sebi-appointed mutual fund advisory panel, scheduled to meet September 1, will discuss the matter, said three people familiar with the development. Exact details of the proposed rules could not be ascertained, but one official sai...

Government notifies changes in Banking Regulation Act   The government has notified the Banking Regulation (Amendment) Act under which it can authorise the RBI to issue directions to banks to initiate insolvency resolution process to recover bad loans.    The banking sector is saddled with non-performing assets (NPAs) of over Rs 8 lakh crore, of which Rs 6 lakh crore is with public sector banks (PSBs).    Earlier this month, Parliament had approved the Act, which replaced an ordinance in this regard.    The government in May had promulgated an ordinance authorising the Reserve Bank of India (RBI) to issue directions to banks to initiate insolvency resolution process under the Insolvency and Bankruptcy Code, 2016.    Following the ordinance, the RBI had identified 12 accounts each having more than Rs 5,000 crore of outstanding loans and accounting for 25 per cent of total NPAs of banks for immediate referra...

Insurance firms tap blockchain for ease of transaction 13 companies to create pool of policyholder data; to lower cost for insurers Thirteen Indian insurance companies have come together to use a blockchain-like technology to create a central repository of policyholder data, so that insurers need not repeat the registration procedure for multiple policies. “When the same records are available to a number of life insurance companies in a chain, the cost incurred by them is lower compared to what it is when they were all separately conducting tests and storing records,” said Akshay Dhanak, vice-president, business systems & technology at HDFC Life Insurance. A whole lot of work has to be done in know-your-customer, medical underwriting, financial underwriting, etc, when a customer buys insurance, he said. Duplication of these procedures can be avoided by having the entire data set on blockchain. Blockchain is like a digital ledger used to store information o...

Now, SFIO has powers to arrest people for violations of companies law While the Companies Act, 2013 provides powers of arrest to the SFIO, which comes under the corporate affairs ministry, the provision has been notified only now. The Serious Fraud Investigation Office (SFIO) now has powers to arrest people for violations of companies law, with the government notifying relevant provisions amid the crackdown on illicit fund flows. The shot in the arm for the probe agency also comes at a time when the government is cracking the whip on suspected shell companies being used for illegal activities, including money laundering and tax evasion. While the Companies Act, 2013 provides powers of arrest to the SFIO, which comes under the corporate affairs ministry, the provision has been notified only now. Most provisions of the Act came into force on April 1, 2014. The SFIO is a multi-disciplinary organisation having experts for prosecution of white-collar crimes and frauds...

Post-GST haze may delay foreign trade policy The mid-term review of the Foreign Trade Policy had earlier been scheduled for release on July 1 along with GST   The mid-term review of the Foreign Trade Policy (FTP) is struggling to meet its September deadline, despite being pushed back from its initial release date of July 1, sources say.   Senior government officials claimed work was on the fast track. But they were not sure if the revised policy can be released by September. Assessing the effects of the goods and services tax (GST) regime on the export system and the export promotion schemes were throwing up new challenges every week, they explained. As of now, the government is busy trying to deal with the issue of exporters losing a major chunk of their working capital, because of GST. Complaints by exporters regarding reduced utility of duty credit scrips, which only cover basic Customs duty and not the integrated GST, were also being looked ...

Deadline for Aadhaar PAN linkage to stay Tax payers will have to link their PAN with Aadhaar by the stipulated deadline, which is this month-end, as the Supreme Court verdict on privacy has no bearing on the requirement, UIDAI CEO Ajay Bhushan Pandey has said. The requirement for Aadhaar being quoted for availing government subsidies, welfare schemes and other benefits will also continue unhindered for now, he told PTI. The government had mandated linking of PAN with Aadhaar by the extended deadline of August 31. Asked about the implication of the Supreme Court ruling (privacy being a fundamental right) on linking of Aadhaar and PAN, Pandey said: "There also, linking of PAN to Aadhaar is mandated by an amendment in income tax act...the linking will continue under that act and law. There is no change". Pandey said various deadlines that have been prescribed, be it under provision of Aadhaar Act, Income Tax Act or money laundering rules will "have to be adhered to...

Tighter norms for gold jewellery exporters The Centre is considering fresh measures to stop malpractices in the export of gold jewellery, said two persons familiar with the development. A trade notice issued by the Noida Export Promotion Zone Customs collector on Thursday asked jewellery exporters not to import gold on loan. They will now have to take gold on loan only from nominated agencies and banks. Importing gold on loan is considered a banking transaction where interest is paid and hence, “banking transactions for gold exports, like taking gold on loan, shall be done in India,” said Rahul Gupta, chairman of the Export Promotion Council for EOUs and SEZs (EPCES). Another person familiar with the development said that a recent meeting of development commissioners of SEZs discussed misuse of facilities by jewellery exporters and decided to review the practice of job work outside SEZ areas. “If it is found that misuse is rampant more stringent measures may be taken,” the source s...

More than 2.9 million file GST returns As many as 2,964,653 filers had submitted returns for July under the goods and services tax (GST) regime by the Friday evening. Friday was the deadline for filing returns. The number of filers are likely to increase as the day ends. GST Network, which is responsible for the information technology backbone of the indirect tax regime, has estimated about 4.8 million returns would be filed. Those who have filed returns constitute over 34 per cent of total assessees, of about 8.7 million, under the GST regime.However, of the 8.7 million assesses, 2.2 million are yet to complete the migration process. A last minute rush had led to the GSTN portal crashing last week, forcing the government to postpone the tax filing deadline by five days to August 25. Those who wish to claim transitional input tax credit can file returns by August 28. About 4.8 million taxpayers had saved their sales data on the portal till August 23 and they are just a step away fr...

Customs Seeks to Put Exports in Cruise Mode Cargo to bypass inspectors, to sport RFID chip from Oct Keen to reduce inspector raj from movement of India's exports, the customs department is devising a plan that will allow goods to move from factory to ships without any checks.From October, consignments would not be required to be sealed in the presence of inspectors. Instead they will sport an RFID chip with details of the consignment that can be accessed by a reader. “Supervised sealing of containers will be discontinued from October,“ said a government official. Instead, electronic self-sealing with RFID chip will be introduced, the official added. Only those consignments with perceived risk will be closely examined. This would enable cargo to move expeditiously and prevent unnecessary hold ups at ports bringing down transaction cost of exporters and also chances of corruption. The development follows the risk based assessment introduced by the Customs through SWIFT, or Sing...