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In a First, Firm Liquidated as a Going Concern NEW CHAPTER Move helps lenders recover more money against unpaid loans F or the first time under the Insolvency and Bankruptcy Code, Kolkata-based Keshav Sponge and Energy has been liquidated as a ‘going concern’, marking a new chapter in the evolving Insolvency and Bankruptcy Code that provides the framework to extricate billions of dollars stuck in bad loans. This move has twin-benefits: It helps lenders recover more money against the unpaid loans, and creates future job opportunities for those employees who used to work for the company. ‘A going concern’ or ‘a slump sale of the assets’ enables the sale of business of the company including all its assets and properties. The business of the company is continued during the liquidation process by the liquidator. “The process of selling all fixed assets is over. It will take some more time to complete the entire process,” said Anil Agarwal, the official liquidator, who works for AAA

Centralised AAR for GST on Cards for Uniform Rulings Bid to prevent divergent rulings on identical issues that fuel confusion India is looking at creating a centralised Authority for Advance Rulings (AAR) for the goods and services tax (GST) after divergent rulings on identical issues fuelled confusion over applicability and the rate of tax. A recent case in point being the divergent rulings by Karnataka and Maharashtra AARs on the issue of solar projects. “We are looking at an issuebased central authority with officials from states and the Centre,” a top government official told ET. “If more than one appeal is filed on the same issue in different jurisdictions it can be taken up by this body.”The AAR is a quasi-judicial body that allows assessees to get guidance on their potential tax liabilities relating to any transaction beforehand. The rulings by the AAR are case-specific, but they have a persuasive impact on tax assessment in cases of other firms under similar circumsta

Delisting norms: SEBI provides relaxations for insolvent firms More than 750 entities, including many listed firms, are facing insolvency proceedings Sebi has relaxed requirements to comply with delisting norms for companies facing insolvency proceedings provided the resolution plan lays down the procedure for delisting that particular entity from the exchanges. The move is expected to provide succour for various listed companies that have been referred for resolution under the Insolvency and Bankruptcy Code (IBC).More than 750 entities, including many listed firms, are facing insolvency proceedings. In a notification, the markets regulator said norms pertaining to delisting of equity shares would not be applicable to any entity that is getting delisted pursuant to a resolution plan approved under the IBC.The exemption would be subject to conditions that the resolution plan "lays down any specific procedure to complete the delisting of such shares" or that the plans

  Free banking services offered to customers not under GST ambit The ambiguity arose after notices were sent to lenders for non-payment of service tax under the pre-GST regime In relief for the banking sector, the government cleared the ambiguity over goods and services tax (GST) on ‘free services’ offered to customers. The Centre said these will not attract GST. The ambiguity arose after notices were sent to lenders for non-payment of service tax under the pre-GST regime. That issue is yet to be sorted, though the government has given enough signals that these notices might be withdrawn. In 32 pages of ‘Frequently Asked Questions’ (FAQs) for the financial services sector, issued on Sunday, the Central Board of Indirect Taxes and Customs (CBIC) clarified there would be no levy on services provided without consideration (free) to other than related/distinct persons. Government answered 91 in FAQs In other important clarifications, CBIC has noted that ATM machines do not trig

SEBI Lens on FPIs Under NRI ‘Control’ Eye on 2019 Polls: Custodians of FPIs told to identify such offshore funds The Securities and Exchange Board of India has asked custodians of foreign portfolio investors (FPIs) to identify offshore funds that are ‘controlled’ by nonresident Indians. Sebi, acting on the government’s instructions, has made it clear through fresh restrictions on investments and in subsequent meetings over the past few weeks that it’s not in favour of NRIs using FPI vehicles to trade on Indian stock exchanges. This is primarily due to a growing suspicion that resident Indians have been using NRI friends and relatives to bring back and legitimise undisclosed funds parked abroad through fund structures that are registered as FPIs with the capital markets regulator. It is widely perceived that New Delhi is trying to minimise the inflow of money through round-tripping in the run-up to the 2019 elections. “Many custodians were told last week to share data. It is

Tax Axe Still Looms for Banks on Free Services Despite FAQs mentioning GST exemption, banks will have to slug it out before adjudicating authority. India’s banks, faced with having to pay thousands of crores in taxes on services provided in lieu of customers maintaining a minimum balance in their accounts, will have to slug it out before the adjudicating authority with the tax department. ET had reported earlier that State Bank of India, HDFC Bank, ICICI Bank, Axis Bank and others have been sent notices by Directorate General of Goods and Services Tax Intelligence (DGGSTI). “Show-cause notices have been issued so due process of law will have to follow,” a senior government official aware of the matter told ET. This comes even as the government has clarified that free services to unrelated parties will not attract goods and services tax (GST) through detailed frequently asked questions (FAQs) for the financial services industry. The indirect tax authorities are convinced abo

 Int'l Passengers Need Not Pay GST at Duty-free Shops International passengers buying goods at airport ‘dutyfree’ shops will not be subject to GST and the revenue department will soon clarify on this exemption, an official said. Following an order passed in March by the New Delhi bench of the Authority for Advance Ruling (AAR) stating that GST would be leviable on sale of goods from 'duty-free' shops at airports, the revenue department had received a number of representations seeking clarification on the issue. The revenue department will clarify that duty-free shops will have to only collect a copy of the passport from the passenger to whom it sells the goods and later on seek GST refund from the government, the official added. Experts said that the AAR order had put such shops in a fix, since they were exempt from central sales tax and value added tax in the earlier indirect tax regime. In that mechanism, sale from such shops were considered as exports and supplies we