CA Online

NEW DELHI: Providing the first possible avenue to resolve insolvency in a market-determined and time-bound manner, the Insolvency and  Bankruptcy Code will help improve ease of doing business as well as develop the debt market, says IBBI Chairperson M S Sahoo. Less than four months old, the Insolvency and Bankruptcy Board of India (IBBI) has started its work in a mission mode and well over 900  insolvency professionals have already registered with it. IBBI has been set up under the Insolvency and Bankruptcy Code, which was cleared by Parliament last year. The Code seeks to consolidate  and amend laws relating to reorganisation and insolvency resolution of corporate persons, partnership firms and individuals in a time- bound manner. "We needed a mechanism to resolve the insolvency wherever there was a default at the first possible opportunity and release idle resources  for efficient use. The Bankruptcy Code provides these in a market-determined and time-bound manner...

The Budget 2017 18 isexpected to focus on recasting and reorienting existing flagship programmes of the Narendra Modi government, with added funds to ensure their completion before the next general elections and alsoensure benefits of such schemes reachthe last mile. Officials said the rural developmentsector,inparticular, couldseeajumpinallocations in all its major schemes and programmes,followedbyschemes related to poverty alleviationand the socialsector. The possibility of as lew of big schemes and mega announcements looks remote, with the exception of revising income tax slabs to mollifythe middle classes and areferenceto the basic income transfer scheme. The budgetary outlay could see significant increase in infrastructure,social sector schemes,micro, small and medium enterprises, rural sector and job creation. Officials say that aslong as the government can ensure last-mile delivery and better targeting of beneficiaries, the existing programmes are sufficient to reach out to ...

It is easier to track cash which has returned to banking channels, Revenue Department said Demonetisation will lead to a wider tax base and lower interest rates, thus paving the way for "sustainable faster economic growth", the Finance Ministry has said. In a written response to the Parliament's Public Accounts Committee (PAC), the Revenue Department said that due to the withdrawal of old high-value notes, the idle or hidden cash has come into the formal system which will be utilised for productive purposes. "Targeted verification of suspect substantial deposits is likely to widen and deepen the tax base," it said. It is easier to track the cash which has returned to banking channels, thus making tax evasion "more difficult", it added. Further, increased availability of funds with banks and "lowering of interest rates" are expected to enhance credit disbursal, promoting investments in productive economic activities and giving a boost to grow...

NSUNDARESHA SUBRAMANIAN & SUDIPTO DEY offshore vehicles, including foreign portfolio investors (FPIs), were subject to indirect transfer provisions. The move set alarm bells ringing in fund houses from Hong Kong to London and New York. Effectively, the indirect transfer provisions imposes taxes on offshore transactions if the value of Indian assets represent 50 per cent or more of the value of  all assets owned by the FPIs. The circular contained responses to queries on the indirect transfer provisions in a number of different contexts, such as redemptions by offshore funds registered  as FPIs, master-feeder structures, and corporate reorganisations. “While the expectation was that the circular would examine the practical problems being faced  by stakeholders and propose rectifications to the indirect transfer provisions or, at least, relax the rigours arising from a mechanical application of the existing  provisions, the circular instead confined itself to an e...

Protectors can help ring-fence the working of the trustees and ensure the rules do not become rigid PRIYANAIR Can someone entrusted to protect the well-being of your family unwittingly act against them, based on your instructions? Private trusts that are  set up for the distribution of wealth to the next generation could face this situation if the structure is not carefully formed. Recently, there  was a case where a trustee was accused of acting against the interests of the beneficiaries. The beneficiaries in this case were a mother and child. They accused the trust of paying as monthly maintenance a lesser amount than what was decided by the settler, the father who is no more. The trust said it acted on the instructions of the protector, also appointed by the settler. The court has asked all the parties involved to settle the matter among themselves. In India, the concept of a corporate trustee is slowly catching on as high net worth individuals (HNIs) prefer such a structu...

It is easier to track cash which has returned to banking channels, Revenue Department said Demonetisation will lead to a wider tax base and lower interest rates, thus paving the way for "sustainable faster economic growth", the Finance Ministry has said. In a written response to the Parliament's Public Accounts Committee (PAC), the Revenue Department said that due to the withdrawal of old high-value notes, the idle or hidden cash has come into the formal system which will be utilised for productive purposes. "Targeted verification of suspect substantial deposits is likely to widen and deepen the tax base," it said. It is easier to track the cash which has returned to banking channels, thus making tax evasion "more difficult", it added. Further, increased availability of funds with banks and "lowering of interest rates" are expected to enhance credit disbursal, promoting investments in productive economic activities and giving a boost to grow...

The Securities and Exchange Board of India (Sebi) has set Rs.500 crore in one of the past three years as the minimum turnover for a commodity to remain eligible for futures trading on exchanges. This will come into effect from April 1. “For any commodity to continue to be eligible for futures trading on exchanges, it should have an annual turnover of more than Rs.500 crore across all national commodity derivatives exchanges in at least one of the last three financial years,” Sebi said in a circular on Friday. A commodity that generates less than Rs.2 crore a day in trading volume across all contracts and exchanges will thus be delisted. This is aimed at parking of funds in illiquid contracts to evade taxes. Sebi has provided three years of gestation for commodities from their launch or re-launch dates. “Exchanges earn Rs.250 per day for a commodity generating Rs.1 crore of turnover. While the norms are good, the limit should have been much higher for any exchange to launch co...

The Income-Tax(I-T)department has received confirmations for over Rs.300 crore declarations from across the country till now as part of the on going black money window called the Pradhan Mantri GaribKalyanYojna(PMGKY), brought out by the government post demonetisation. Officials said I-Tdepartment offices across the country have got a number of small to big declarations in this regard after the taxman launched a large number of search,survey, seizure and electronic database analysis operations to check stash funds hoarded orgenerated after the note ban.  Business Standard New Delhi,21st January 2017

The Railway Ministry on Friday spelt out the procedure for cancelling tickets booked through Point of Sale (PoS) machines as it prepares to install 10,000 of them across ticket reservation counters in a bid to encourage cashless transactions following demonetisation. In case of tickets booked through SBI PoS machines at a reservation counter, a customer can approach a counter and cancel his ticket. He doesn't need to swipe his card again for cancellation as the refund will be credited directly to his or her bank account within 7 days, according to a statement issued by the Railway Ministry. Where a customer has booked his ticket through a non-SBI PoS the customer needs to swipe his credit or debit card at the PoS machine at the time of cancellation. The refund amount will then be credited to his or her account. However, at a location where there is no PoS a Ticket Deposit Receipt (TDR) will be issued to affect the refund. In a situation where a customer has booked an e-ticket...

Market Regulator Plans To Cut Post-IPO Listing To 4 Days Sebi chairman U K Sinha said on Friday the market watchdog may further tighten rules governing Participatory Notes (P-Notes), which are a financial derivative product used by foreign investors to bypass the regulatory system when entering the Indian market. He also said the regulator is working to cut down the time taken for companies to list their shares on the exchanges post public offerings to four days from six days now. P-Notes had been identified by a special investigation team (SIT) -looking into the menace of black money under orders from the Supreme Court -as one of the probable routes that facilitate generation and use of unaccounted funds. “SIT is constantly monitoring the P-Note data and is not very comfortable with the current process of issue and administration of the same. Further tightening of norms governing P-notes could happen to address the concerns of SIT,“ Sinha said. He was delivering the inaugural sp...

Govt notification comes after irregularities were found in several co-op banks during demonetisation The government has barred cooperative banks from accepting deposits under the Pradhan Mantri Garib Kalyan Deposit Scheme (PMGKDS). There have been irregularities discovered in cooperative banks during the demonetisation process that the income tax department is investigating. “It is clarified that co-operative banks are not authorised banks to accept deposits under PMGKDS, 2016,“ a finance ministry statement said on Friday. The deposit scheme is part of the Taxation and Investment Regime for Pradhan Mantri Garib Kalyan Yojana, 2016 under which a declarant has to deposit 25% of the declared undisclosed income in an authorised bank as notified by the government. They have to also pay 50% of the amount declared in tax and penalty. “Application for the deposit in the form of Bonds Ledger Account shall be received by any banking company, other than Co-operative Banks, to which the Ba...