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Independent directors in a fix after SC order on asset transfer in Jaiprakash Associates case A recent Supreme Court judgement restraining independent directors of Jaiprakash Associates from transferring any personal assets over a group company’s insolvency issue has sent shock waves through the independent directors’ fraternity, with experts warning that there would be few takers for this role. Several independent directors on boards of companies are now seeking legal advice to find out to what extent they can be held liable for any operational issues in those firms.Kiran Mazumdar Shaw, chairperson of Biocon, said the country is moving from poor governance to extreme governance. “It is unfair to place the entire onus on independent directors who are only privy to the information shared with them by the management,” she said. “Instead of penalising independent directors, the management and promoters should be penalised.” A corporate veteran who is on the board of several blue c...

GST collections in October decline to Rs 83346 crore India’s goods and services tax collections fell to Rs 83,346 crore in October, from more than Rs 90,000 crore in each of the first three months after the new tax regime was rolled out on July 1.  A finance ministry statement attributed the lower collections to the release of state and central GST out of integrated GST (IGST) paid in the first three months, reduction in taxes and payment of GST based on self-declared tax return.  So far, 95.9 lakh taxpayers have registered under GST, of which 15.1lakh are composition dealers who are required to file returns every quarter. As many as 50.1lakh returns were filed for October till November 26, the statement said.  “While the overall collection for the October month is lower, this may not be a cause of immediate concern as it might be due to refunds given to exporters and opening credit claimed by businesses, along with some reduction in the rate in October,” said P...

GST revenue States do better than centre States goverments revenue targets under the goods and service tax (GST) regime were fully met in August - November, with the central goverment making good the shortfall. The centre own revenue fell short of the target as firms used tax credits from the previous regims to meet their tax liability. The Mint, New Delhi, 28th November 2017

Public Bond Sales Slump in India as Stocks Gain Lures Buyers Bond sales by Indian companies to individuals have hit a five-year low and a recovery isn’t in sight as issuers prefer to tap cash-rich banks and retail investors flock to one of Asia’s best-performing stock markets. Public debt offerings plunged 84 percent to 39 billion rupees ($602 million) in the eight months through November compared with the same period a year ago, data from the market regulator show. In contrast, companies have raised a record $11.6 billion from initial share sales this year, data compiled by Bloomberg show. “A reduction in interest rates has made bank loans and private placements cheaper and a faster option to raise funds,” Ajay Saraf, executive director at ICICI Securities Ltd., said in an interview. Investors have been attracted by higher equity returns as demand for public bonds has cooled, he added. Lenders flush with cash after last year’s ban on high-denomination notes have been eager b...

GDP growth likely to improve to 6.2 percent in Q2 Ficci India's GDP growth rate is expected to rise to 6.2 per cent in the second quarter of the current fiscal as the adverse impact of demonetisation and GST appears to be bottoming out, Ficci's latest Economic Outlook Survey said on Monday. The growth rate had dipped to a 3-year low of 5.7 per cent in the April-June quarter of 2017-18. The Central Statistics Office (CSO) is scheduled to release the economic growth data for the July-September quarter on November 30. The economists participating in the survey also mentioned that the government should continue with its emphasis on productive capital investments in the social and physical infrastructure space even if this requires some calibration of the fiscal deficit target, the industry body said. The projected fiscal deficit number for the current financial year is likely to be slightly higher at 3.3 per cent of the GDP in the current fiscal as against the governmen...

Willing to extend deadline for Aadhaar linking to services till March 31 The Centre is willing to extend the deadline for mandatory linking of Aadhaar to various services till March 31, 2018, it told the Supreme Court on Monday.  “We are willing to extend the deadline for mandatory linking of Aadhaar to various services till March 31 next year,” the Centre told the apex court. Aadhaar is a 12 digit unique-identity number issued to all Indian residents based on their biometric and demographic data. The Business Standard, New Delhi, 28th November 2017

India may adopt item-based anti-profiteering rules to benefit users India is likely to adopt a product-specific approach to impose anti-profiteering provisions to ensure that consumers get the full benefit of price cuts due to the goods and services tax (GST), including recent revisions. This means that a company will not be able to reduce prices of slow-moving products in its portfolio while keeping those of fast-moving ones high. "Reduction in overall tax incidence will have to be passed on," said a Central Board of Excise and Customs (CBEC) official. "The authority will examine input tax credit flowing into a product and reduction in total tax incidence when it gets a complaint." The GST Council had, at its last meeting, cut the tax rate on 178 household goods such as detergents, shampoo, shaving cream and cosmetics to 18 per cent from 28 per cent . The government has asked industry to pass on GST reductions to consumers. The CBEC chairman has also writte...

Draft national energy policy proposes aligning energy prices with international rates A draft national energy policy proposing aligning energy prices with international rates will be put up for the approval of the Cabinet.If approved, energy prices across sectors would become market-driven and subsides would be limited to identified beneficiaries via direct benefit transfer, much on the lines of the LPG subsidy In June, government think tank Niti Aayog released a draft National Energy Policy (NEP), on which it had been working since 2015.  Prime Minister Narendra Modi had chaired interministerial consultations on the policy after the coal ministry expressed reservations over market-driven prices that would pose a threat to the monopoly and margins of Coal India. The policy will help India integrate with the global energy world without compromising on the energy needs of the poorest of the poor, who will continue to get subsidy on all forms of energy directly into their bank...

Some promoters escape tight insolvency norms Promoters of at least four small companies managed to pass their resolution plans before New Delhi tweaked the bankruptcy code, limiting the ability of erstwhile defaulting owners from buying back their assets at the conclusion of time-bound recovery proceedings Synergies-Dooray, Chhaparia Industries, Sree Metaliks, and the West Bengal Essential Commodities Supply Corporation have all presented successful resolution plans approved by respective chapters of the National Company Law Tribunal (NCLT). “The ordinance is not retrospective,” said Sandeep Parekh, founder of Finsec Law Advisors. “Those companies were fortunate enough to go through successful resolution plans under the code, but without the new amendments. The outcome could have been different under the latest ordinance subject to promoters’ eligibility.” In absence of adequate bidders, promoters have mostly regained control in all those companies where they were resolution ...

Government is keen to meet FY18 deficit target The government is keen on sticking to the fiscal deficit target for the year and will look for ways to make up for any revenue shortfall that could hinder this plan. The thinking at the highest level of the government is that the fiscal deficit target of 3.2% of GDP for FY18 should be met, though there can be some relaxation in the consolidation roadmap beyond that. "There seems to be some discomfort about letting go fiscal goals... The thinking as of now is that the target should be met," said a senior government official aware of the matter.There have been preliminary discussions on the issue but a final call will only be taken after the revenue position becomes clearer post December. The government has met budget targets in the last three years, which has helped establish budget credibility, something that it does not want to compromise. Following a slump in growth in the third quarter to a three-year low, there had be...

Over one third of registered companies out of business More than one-third of the total 17 lakh registered companies in the country were shuttered as on end of October, latest official data showed. While authorities step up their clampdown on companies suspected of being used as a conduit for illegal activities, the number of active firms stood at little over 11.30 lakh as on October 31.The corporate affairs ministry, which is implementing the Companies Act, has so far struck off the names of around 2.24 lakh entities that have not been carrying out business activities for long. "The total number of companies registered in the country as on October 31, 2017, stood at 17,04,319... there were 11,30,784 active companies as on October 31, 2017," the ministry said in a report for the month of October. According to the report, out of the total, 5.35 lakh companies were closed down, 1,123 were assigned dormant status, 5,957 were under liquidation and 31,666 were inhe proce...