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Tuesday, April 29, 2008

FDI Update- Credit Info Co, Commodity Exchange, Foreign Currency Bids of Indian Projects, SEBI SARFAESI QIB notification

Foreign investment in Credit Information Companies:

1. To comply with the Credit Information Companies (Regulations) Act 2005 and

2. subject to the following :
i) The aggregate Foreign Investment in Credit Information Companies would be 49%.

ii) Foreign Investment upto 49% would be allowed only with the prior approval of FIPB and regulatory clearance from RBI.

iii) Investment by SEBI Registered FIIs would be permitted only through purchases in the secondary market to an extent of 24%.

iv) Investment by SEBI Registered FIIs would be within the overall limit of 49% for Foreign Investment.

v) No FII can individually hold directly or indirectly more than 10% of the equity.

A copy of the Press Note 1 (2008 series) dated March 12, 2008 issued by the Government is enclosed.

Click here for Notification

Foreign investment in Commodity Exchanges:

subject to the following conditions : i) There would be a composite ceiling of 49% Foreign Investment, with a FDI limit of 26% and an FII limit of 23%.
ii) FDI will be allowed with specific approval of the Government.
iii) The FII purchases in equity of Commodity Exchanges will be restricted only to the secondary markets.
iv) Foreign Investment in Commodity Exchanges would also be subject to compliance with the regulations issued, in this regard, by the Forward Market Commission.
A copy of Press Note 2 (2008 series) dated March 12, 2008 issued in this regard is enclosed.

Link to the notification

It has been brought to the notice of the Government that some of the existing Commodity Exchanges had foreign investment above the permitted level as on the date of issue of the said Press Note. In order to facilitate the existing Commodity Exchanges to comply with the guidelines notified vide Press Note 2(2008), vide press note 8 of 2008 series dated 19th August 2008 it has now been decided to allow a transition / complying/correction time to the existing Commodity exchange(s). The Commodity Exchange(s) would be required to divest foreign equity equal to the amount by which the cap was being exceeded in accordance with Press Note 2(2008). Accordingly, all such Commodity Exchanges are hereby advised to adhere to the conditions of Press Note 2(2008) by 30.6.2009. All Commodity Exchanges shall furnish a compliance report informing the foreign investment in the Commodity Exchange as on 30.6.2009, along with details of equity structure, to the Department of Industrial Policy & Promotion, Department of Consumer Affairs, Foreign Investment Promotion Board, the Forward Market Commission and SEBI.

Non-compliance of the conditions of Press Note 2(2008) after 30.6.2009 would be a violation of the Foreign Exchange Management Act, 1999

Bids in foreign currency for projects to be executed in India:
1. Person resident in India has been permitted to incur liability in foreign exchange and to make or receive payments in foreign exchange in respect of global bids where the Central Government has authorized such projects to be executed in India and the approval of the concerned Administrative Ministry has been obtained. In such cases, authorized dealers are permitted to sell foreign exchange to the resident Indian company which has been awarded the contract.
2. Persons resident in India are now permitted to incur liability in foreign exchange and to make or receive payments in foreign exchange in respect of global bids for projects to be executed in India without insisting on prior approval of the concerned Administrative Ministry for the International Competitive Bidding.

Link to Notification

SEBI Notification under Section 2(1) (u) of SARFAESI Act, 2002:

certain non-deposit NBFC = QIB u/SARFAESI

Non-banking financial companies (NBFC) registered under section 45-IA of the Reserve Bank of India (RBI) Act, 1934 and satisfying the following conditions shall be qualified institutional buyers (QIB) for the purposes of the SARFAESI Act,


1. systemically important non-deposit taking non-banking financial companies (NBFCs) with asset size of one hundred crore rupees and above (>=100 Crores); and
2. other non-deposit taking NBFCs which have asset size of fifty crore rupees and above (>=50 Crores) and “Capital to Risk – weighted Assets Ratio” (CRAR) of 10% as applicable to non-deposit taking NBFCs as per the last audited balance sheet.

Notification in

Saturday, April 26, 2008

"shareholder having trading rights" under SCRR (MIMPSRSE), 2006

Yes, Sebi vide

The term “shareholder having trading rights” under Securities Contracts(Regulation) (Manner of Increasing and Maintaining Public Shareholding in RecognisedStock Exchanges) Regulations, 2006 would mean a shareholder who has a trading interest in the stock exchange, whether directly or indirectly through a person having trading rights.
A shareholder having a trading interest “indirectly” in relation to a person having trading rights, would be understood in the same manner as the term “associate” is in relation to a shareholder having trading rights under regulation 2(1)(b) of the Securities Contracts (Regulation) (Manner of Increasing and Maintaining Public Shareholding in Recognised Stock Exchanges) Regulations, 2006.

Tuesday, April 22, 2008

CS Final HRM Planning & Procurement - Understanding


Yes, the very simple & interesting chapter, just make mind maps, this way, so that you understand better the topic for Company Secretaryship (CS) Final Group -III subject Human Resource Management & Industrial Relations (HRMIR). Just read it once, get the flow, you can win the exams very easily, I guarantee. See Yes with Vj.

Manpower Planning: "continuous process". The process of developing & determing Objectives, Policies & Programs and to develop, utilise & distribute manpower so as to achieve Goals of organisation.

The two phases include,

1. Management to project the future manpower requirements &

2. Develop manpower plans to accommodate the implication of projections.

NATURE of HR Planning:


1. Ascertain Manpower NEEDS (Number & Kind).

2. Ascertain in INVENTORY (water tank) of Existing Manpower (water) – status & untapped talent.

3. Determine shortfall/surplus of manpower.

4. Initiation of Organisation programs depending on Demand & Supply of HR.

5. Encompass Acquisition, Utilisation, Improvement & Preservation of HR.


1. Ensure optimum use of HR.

2. Avoid balance in Distribution & Allocation of HR.

3. Assess/Forecast future skill requirement.

4. Control measure to ensure available resources, when required.

5. Control of cost aspect.

6. Formulate Transfer & Promotion policies.

SCOPE/Elements – HR Planning:

1. Listing of Current HR.

2. Assess the "Extent of Utilisation" of current HR.

3. Phasing out surplus HR.

4. Analysing HR requirements.

5. HR Forecast.

6. Training Programs for different categories.

BENEFITS – HR Planning:

1. Reduce Labour cost.

2. Make optimum Use of workers Skills.

3. Identify gaps of existing HR.

4. Improvement in overall business planning process.

5. Formulating managerial Succession plan.

6. Greater awareness of importance of sound HR.

7. Tool to evaluate effect of alternative HR actions & policies.

HR Planning Process:


1. Objectives – filling the future vacancies with right type of people. Relate Future HR –to Future Enterprise Needs –tomaximise future Return on Investment in HR.

2. Inventory of HR skills (finding gaps): ensure Reservoir of talent is available when vacancies occur. Make Index of Inventory.

3. Work Study & Demand Forecasting: Study,

A. Employment Trends

B. Replacement Needs

C. Productivity: growth potential & healthy wage increase

D. Growth & Expansion: perpetuation

E. Absenteeism: fails to come for work when is scheduled to work;

% = (Mandays lost) divided by (Mandays – both worked & lost)

F. Work study/load analysis

4. Determine Job Requirements: Quantum of work which an average person can do on a job in a day through Job Analysis

5. Recruitment Plan – Programs for R&S

6. Selection Procedure

7. Training & Development Program – T&D

8. Performance Appraisal (find deficiencies in T&D) – PA.


QUALITATIVE ASPECT OF HR PLANNING: Job analysis, evaluation, etc…


I. Demand Forecasting: process of estimating the requirement of different kinds of personnel in future.


i. Managerial Judgement

ii. Work study techniques

iii. Statistical techniques

iv. Combination of above

Managerial Judgement: Includes,

o Bottom-up basis: with Line Managers submitting Proposals

o Top-down approach: Company & Departmental forecast prepared by Top Management.

Work Study Techniques: When there is a possibility to apply Work Measurement to know HOW Long operations should take & amount of Labour required. Through,

1. Work Load analysis (short term projections)

Step1: Determine Manpower required per unit of product.

Step2: Determine how many employees of various types are required to achieve Total Production Target.

2. Work Force analysis (long term projections): Keep sufficient margin for absenteeism, labour turnover & idle time.

Statistical Techniques:

1. Ratios & Trend Analysis (Refer Costing)

2. Econometric Models:

Step 1: Describe relationship between numbers of variables in Math formula.

Step 2: Apply Formula to forecast of movements in these variables.

3. Regression Analysis: When dependant & independent variables are functionally related.

II. Supply Forecasting:

- as to Current Resource & Future Resource;

- as to External Supply & Internal Supply;


1. Markov Analysis: By arranging probabilities of Personnel Transition in Transition Matrix.

2. Simulation: Create an Environment resembling real situation. Also called Vestibule when it comes to Tranining.

3. Renewal Analysis.

4. Goal Programming.

FACTORS affecting Internal Supply:

1. Existing HR

2. Labour Wastage measured using,

1. Labour Turnover Index

2. Labour Stability Index

3. Length of service analysis

4. Survival Rate: proportion of engaged employees REMAIN after 'x' years.

3. Internal Promotions & Transfers

4. Effect of changing conditions of work & absenteeism

5. Sources of supply from within the firm. It is influenced by,

1. Local Factors:

1. Population densities within reach;

2. Current & Future competition;

3. Local Unemployment;

4. Immigration & Emigration;

5. Local housing;

6. Attractiveness of the area to live in & the company to work with;

1. National Factors:

1. Growth of working population;

2. Output of Universities;

3. Demand for Specialised Professionals;

4. Impact of Government Training Schemes;

5. Government Employment Regulation.


I. Job Analysis: Process of obtaining all pertinent job facts; studying the nature & operation of specific job. It can be further divided into Job Description & Job Specifications.

- Job Description: Factual statement of duties & responsibilities which will have,

1. Job Title 2. Location 3. Job Summary

4. Working conditions 5. Hazards.

- Job Specification: Statement of Minimum acceptable Human quality necessary to perform job properly. It will give details as to,

1. Education & Experience 2. Physical skills 3. Communication skills

4. Emotional Characteristics 5. Judgement.

Steps in Job Analysis:

1. R&S 2. Manpower Requirement 3. Compensation Package

4. Performance Appraisal 5. Training (Channelise energy)

6. Job Assignment 7. Job Re-engineering (working methods for higher productivity) 8. Job Analysis Process.

Techniques of Job Analysis:

1. Interview (Individual/Group)

2. Questionnaire – Types,

A. CODAP – Comprehensive Occupational Data Analysis Program;

B. FJA – Financial Job Analysis;

C. MPDQ – Management Position Description Questionnaire;

D. JAIF – Job Analysis Information Form.

3. Observation

4. Data from daily log books.

II. Job Evaluation: Systematic & orderly process of determining the worth of a job in relation to other job.

III. Job Design: Scientific art by which maximum output can be obtained with Minimum Input to the extent possible under given circumstances.


1. Identity crisis 2. Support of Top Management 3. Size of Initial Effort

4. Co-ordination with Management Functions 5. Integration with Organisation Plans 6. Involvement of Operating Manager.


Measurement & reporting of Cost & Value of people as Organisational resources.

- Benefits: assist Managers w.r.t.,

1. Recruit Vs. Promotion 2. Transfer Vs. Retention

3. Retrench Vs. Retention 4. Utility of Cost Reduction Program

5. Impact of Budgetary Control 6. New dimension to Capital Budgeting

7. Return of Investment in Human Assets.

8. Decision on relocating or streamlining, etc…

- Methods:

1. Historical or Actual Cost Method: First Investment is capitalised as Opening Value; Further Investment amortised.

2. Multiplier Method: It divides Cost & Value. Categorise into,

a. Senior Management (Highest) b. Middle Management

c. Supervisor d. Clerical & Operative (Lowest Multiplier)

Multiplier = Personal values of employees relating to Total assets value of organisation.

3. Replacement of Cost Method:

4. Economic Value Method: Discounts to a present value that, portion of companies' future earnings Directly Attributable to HR.

RECRUITEMENT: process of identification of different sources of personnel. Two sources include,

1. Internal Sources: a. Transfer (one job to another) b. Promotion (filling the higher jobs).

2. External Sources:

a. Recruit at Factory Gate b. Casual Callers or Unsolicited Applications

c. Media Advertisement d. Employment Agencies e. Management Consultants f. Campus Recruitments g. Recommendations

h. Labour Contractors i. Telecasting.


Internal Sources

External Sources


From within the organisation.

From outside the organisation.


Quick process

Lengthy process


Cheaper as no cost of contracting

Costly as to be notified


Limited choice of candidates

Infusion of new blood & new ideas



Competitive Spirit.


RECRUITMENT: Attract applicants for vacant jobs;

SELECTION: Rejection of unsuitable candidates.







Process of searching candidate for vacant jobs & making them apply for the same.

Process of selection of right type of candidates & offering them jobs.



Positive Process

Negative Process



Attract more & more candidates.

Reject unsuitable candidate



Firm notifies vacancies through various sources & distributes Application Forms to candidates.

Firm ask candidates to pass through a number of stages such as filling of form, Employment Test, etc…


Contract of Service

Only communication of vacancies.

Leads to Contract of Service.

Employment Test includes, Intelligence Test, Aptitude Test, Proficiency Test, Interest Test, Personality Test.

Interview includes, Patterned, Unstructured, Press, Group Interview in which,

1. Find Suitability;

2. Seek more information;

3. Gives accurate picture of job;

CAREER: A sequence of positions held by person during course of his working life.

CAREER ANCHOR: Basic drives that create the urge to take up a certain type of career. It is concerned with,

1. Technical Competence; 2. Managerial Competence;

3. Security of career; 4. Autonomy;

5. Creativity.

CAREER PLANNING: To provide Continuity, Order & Meaning to person's life. The features include,

1. Process of developing HR

2. Means of managing people to obtain optimum results

3. Continuous process

4. Integration of Individual & Organisational needs.

HR PLANNING facilitates Career Planning.

SUCCESSION PLANNING: Career Planning for higher level executives.

The PROCESS of Career Planning:

Step1: Preparation of HR Inventory;

Step2: Identify Individual Career Needs (to help individual to do their own planning). Also, identify the employees, who are,

· Fit & Willing to Take Up;

· Potential & Willingness to Take Up;

· Capacity to Take Up higher responsibilities.

Step3: Analysing Career Opportunities;

Step4: Matching the Employees Needs with Career Opportunities;

Step5: Formulation & Implementation of Training & Development (T&D) program;

Step6: Review of Career Plan.

Your earnest comments are very valuable to make every subject even many more interesting. Yes frens, CS exams are nearin... Come on... Do it...You can...Enjoy passin...Keep Communicatin...Vj

Friday, April 18, 2008

Dividend/IEPF timeline, charts & concepts - Article in CS Mysore E-Newsletter


CS Mysore 51st E-Newsletter has honoured me by publishing my article under the head "Spectrum Space" which talks about the Secretarial Practice to Winning Study by giving pictures, charts & ideas to make "Dividend very easy".

See Yes, click to see the 1st page & click here to see the 2nd page; Yes click the bottom right corner to the picture, to enlarge it.

But, read the wonderful E-Newsletter by clicking and join the group by clicking to stay inspired.

Waiting for your critical & valuable comments. You can only improve me, please....

Keep Communciatin...Vj

Monday, April 14, 2008

Pay tax electronically, if your 4th Digit of PAN is "C" & Taxpayers know your Rights


As CBDT mandated electronic payment of tax by Company & a person (other than a company), to whom provisions of Section 44AB are applicable [hereinafter collectively referred as "Taxpayers"], w.e.f. 1.4.2008, RBI has notified RBI/2007-08/280 DGBA.GAD. No. H. 10875 / 42.01.038/ 2007-08, by which, the banks shall not accept physical challans from such assessees across the counter.

You are a Corporate Assessee, so your 4th digit in the PAN is "C" and yes, pay tax only through electronic payment facility. The responsibility of making e- payment rests primarily with the taxpayer. Hence, the word of taxpayers should be taken as final.

Taxpayers, know your rights,

1. the acknowledgement for e-payment should be made available immediately on screen by the bank concerned. [check out your immediate acknowledgement]

2. the transaction id of e-payment should be reflected in the bank's statement. [check your bank statement for Transaction-Id]

3. each bank should prominently display on its e-payment gateway page, the official /s to be contacted in case the taxpayer faces any difficulty in making the payment, completing the e-transaction, generating the counterfoil etc. [feel free to contact the banking official for doubts]

4. also, banks are mandated to give the Income Tax Department and NSDL, a list of officials with contact particulars, to be contacted if required for any problems faced by ITD or taxpayers. [find out the name & contact details of your official from the list]

Keep payin electronically...Vj

Tuesday, April 8, 2008

SEBI amends Clause 49

SEBI amends Clause 49

Loophole left in the Clause 49 was plugged...

1) Companies are complying with Clause 49 of the listing Agreement only in letter and not in spirit. Now, if you have a person related to promoter as non-executive chairman, then half of the board should be independent.

2) The age limit of the Independent director fixed to a minimum of 21 years.

3) The time limit for appointment of another independent director after resignation of an independent director fixed as max. 180 days...but if the one-third/half composition is complied with, even after resignation, then this provision is not applicable.

SEBI had received requests/suggestions to bring about clarifications on certain provisions of the clause. After examining the same, it has been decided to modify the existing Clause 49. Hence SEBI vide circular SEBI/CFD/DIL/CG/1/2008/08/04 dated April 08, 2008 issued to stock exchanges has amended Clause 49 of the Listing Agreement to include the following provisions:
Mandatory provisions:
1. If the non-executive Chairman is a promoter or is related to promoters or persons occupying management positions at the board level or at one level below the board, at least one-half of the board of the company should consist of independent directors.
2. Disclosures of relationships between directors inter-se shall be made in specified documents/filings.
3. The gap between resignation/removal of an independent director and appointment of another independent director in his place shall not exceed 180 days. However, this provision would not apply in case a company fulfils the minimum requirement of independent directors in its Board, i.e., one-third or one-half as the case may be, even without filling the vacancy created by such resignation/removal.
4. The minimum age for independent directors shall be 21 years.
Non-mandatory provisions:
The company shall ensure that the person who is being appointed as an independent director has the requisite qualifications and experience which would be of use to the company and which, in the opinion of the company, would enable him to contribute effectively to the company in his capacity as an independent director.

Full text of SEBI circular at

Understand the SEBI Updates here....

Monday, April 7, 2008

Company Secretary (CS) Study Videos on Directors appointed by Board u/s. 260, 262 & 313 of Companies Act, 1956

Yet another effort, a try to make CS (Company Secretary) study very interestin...Now its video venture....Yes...its "See Yes E-C(ast)"....

Here, three videos on Appointment of Directors by Board covering Sections 260, 262 & 313 of the Companies Act, 1956.

This is purely an adventurous venture to make CS study very excitin...Comment your needs & satisfaction, as by it, only I can improve, or inspire more....please keep inspirin...

Welcome, advice or suggestions from earnest friends & professionals to enhance my work.

Review it as critically as possible, now hav a look at it....




Keep Viewin...Keep Communicatin...Vj

Saturday, April 5, 2008

SEBI Revision in Fees&changes in Depositories&Participants Regulations&Cos(AS) amendment rules,2008

Securities And Exchange Board of India (Payment of Fees) (Amendment) Regulations, 2008 dated 31/03/2008 which is applicable with effect from 1st April 2008.

Yes....SEBI has revised its fee structure under various regulations, its very clearly explained in the SEBI circular itself

Now, through SEBI (Depositories and Participants) (Amendment) Regulations, 2008 dated 17/03/2008, the following amendments were made in Regulation 7 (i.e) Grant of Certificate of Registration:
1. In Regulation 7(d), the balance of the equity capital of the depository shall be held by its participants is DELETED, so only condition being "the sponsor shall, at all times, hold at least fifty-one per cent. of the equity share capital of the depository;”
2. The meaning of foreign entity and their Minimum Holding in equity of Depository as given in Regulation 7(e) is DELETED and in lieu of which, the following is inserted under R-7
"(ea) no person other than a sponsor, whether resident in India or not, shall at any time, either individually or together with persons acting in concert, hold more than five per cent of the equity share capital in the depository;
Explanation: For the purposes of this clause, -
(i) the expression “person resident in India” shall have the meaning assigned to it in clause (v) of section 2 of the Foreign Exchange Management Act, 1999 (42 of 1999);
(ii) the expression “persons acting in concert” shall have the meaning derived from clause (e) of sub-regulation (1) of regulation 2 of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997;
(eb) the combined holding of all persons resident outside India in the equity share capital of the depository shall not exceed, at any time, forty-nine per cent of its total equity share capital, subject further to the following:-
(i) the combined holdings of such persons acquired through the foreign direct investment route is not more than twenty six per cent of the total equity share capital, at any time;
(ii) the combined holdings of foreign institutional investors is not more than twenty three per cent of the total equity share capital, at any time;
(iii) no foreign institutional investor acquires shares of the depository otherwise than through the secondary market;
(ec) no foreign institutional investor shall have any representation in the Board of Directors of the depository;”

Also have a look @ Companies (Accounting Standards) Amendment Rules, 2008 in

Keep Updatin...Vj

Thursday, April 3, 2008

NSE Listing Fees & Clause 35 amendments

Credits to Mr. Ashwin...for this detailed presentation...

Listing fees as the name implies is the fees to be paid by the companies to the stock exchange where their shares are listed based on the paid up capital of the Company. This is to be paid annually. The Annual listing fee of National Stock Exchange of India Ltd.,(NSEIL) each year has to be paid on or before 30th of April.

The listing fees of NSEIL has been revised/changed w.e.f. 1st April, 2008 and the revised list is as follows:-



Amount (Rs.)


Initial listing Fees(one time payment)



Annual listing Fees (based on paid up share, bond and/or debenture and/or debt capital, etc.)




1 Crores


1 Crores

5 Crores


5 Crores

10 Crores


10 Crores

20 Crores


20 Crores

30 Crores


30 Crores

40 Crores


40 Crores

50 Crores


50 Crores

100 Crores


100 Crores

150 Crores


150 Crores

200 Crores


200 Crores

250 Crores


250 Crores

300 Crores


300 Crores

350 Crores


350 Crores

400 Crores


400 Crores

450 Crores


450 Crores

500 Crores


500 Crores

375,000+2500 for every increase of 5 crores or part thereof

1000 Crores

630,000+2750 for every increase of 5 crores or part thereof



Through Circular NSE/CML/2006/002 dated April 26, 2006 amendment was made in Clause 35 of listing agreement requiring the company to file shareholding pattern within 21 days from the end of the each quarter.

Under clause 35, company is also required to file statement of locked in shares in Format (l) (d)

Format (l) (d) under Clause 35 of the listing agreement is altered by introducing a new column – "Category of share holders" After the amendment it stands as follows:-

(l)(d) – Statement showing details of locked in shares


Name of the shareholder

*Category of shareholders (Promoters/Public)

Number of locked-in shares

Locked-in shares as a percentage of total number of shares{i.e., Grand Total (A)=(B)+(C) indicated in Statement at para (l)(a) above}




*New addtion in the format (l)(d) of the clause

Keep updatin...

CS Updatin...

See Yes -> Yes, ACS

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