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Showing posts with label CS Executive Economic Law. Show all posts
Showing posts with label CS Executive Economic Law. Show all posts

Friday, May 11, 2012

Download OnlyThisMuch book Update Amendments 2012 for Company Secretary June exams onwards covering Corporate laws, Securities laws, Due Diligence, Voluntary Corporate Governance Codes, Schedule VI XII, Takeover Code 2011, Legal Metrology Act, Foreign Contribution, FDI Policy & ICDR with ICSI Supplements to enjoy passing

OnlyThisMuch book series has released most crucial Updates/ Amendments 2012 for June exam onwards under all laws applicable for Company Secretary exams [CS Executive Programme & Professional Program].  The same can be read from: http://www.scribd.com/doc/93236216/Only-This-Much-Amendments-Laws-2012-Updates-for-Company-Secretary-Exams-on-Corporate-Economic-Securities-Secretarial-Practice-Drafting-Alliances#fullscreen

(Better when downloaded).  It covers the following laws:

Company Law/ Company Secretarial Practice/ Corporate Restructuring

1.       Amendments in MCA-21 & Filing aspects

2.       Amendments in Clauses of Memorandum Of Association

3.       Amendments in Unlisted Public Companies PREFERENTIAL ALLOTMENT Rules u/s. 81(1A)

4.       Amendments in General Meetings & Board Meetings related

5.       Amendments in Managerial Remuneration under Schedule XIII

6.       Amendments in Related Party Transactions under Sections 295, 297 & 314 of Companies Act, 1956

7.       Amendments in Merger of Government Companies u/s. 396

8.       DEFUNCT COMPANIES & FAST TRACK EXIT SCHEME

9.       Form & Contents of Annual Accounts under Revised Schedule VI

 

CRUCIAL DOWNLOADS FOR LAST MINUTE READING BEFORE CS EXAMS:

For Direct & Indirect Tax Laws Amendments, download & print the ICSI Supplement from this link [this is applicable for CS Executive & Professional Program exams

Click here for Financial Management Theory

Glance through MCA Guidelines on Governance

Securities Law/ Due Diligence

1.       Amendments in SEBI ICDR Regulations, 2009

2.       Amendments in Equity Listing Agreement

3.       Public Issue by SME’s & SME Equity Listing Agreement (most predicted question for this exam)

4.       Debt market issues & Securitised Debt Listing Agreement

5.       Revised Insider Trading Disclosures

6.       New Takeover Code, 2011

Corporate Governance/ Securities Law

1.       New Voluntary Governance Codes in India

(including MCA’s Corporate Governance & CSR Code, Secretarial Audit, ICSI’s recommendations)

2.       New Governance Codes abroad

(including UK Corporate Governance & Stewardship Codes)

3.       Other Amendments – Internal Control, Credo & Green Tribunal

 

Other Laws for CS Exams:

1.       Amendments in FEMA & CONSOLIDATED Foreign Direct Investment (FDI) POLICY, 2012  [for Drafting & Alliances in Professional Program, Economic Laws in Executive Program]

2.       FOREIGN CONTRIBUTION (REGULATION) ACT, 2010 & RULES 2011 [FCRA] replacing Old Act [for Economic Laws in Executive Program & has Compounding provisions as relevant for Drafting]

3.       Competition Act, 2002 & Mergers, Amalgamations, Acquisitions & Takeovers (MAAT) [for Drafting & Corporate Restructuring in Professional Program & Economics Laws in Executive Program]

4.       Legal Metrology Act, 2009 replacing Standard Weights & Measures Act [for Eocnomic Laws in Executive Program]

 www.learnlabz.com

 onlythismuch@lawlabz.com

Only This Much Amendments Laws 2012 Updates for Company Secretary Exams on Corporate, Economic, Securities,...

Enjoy passingSmile

Tuesday, September 20, 2011

Download CS Reference Book for Foundation,Executive & Professional Program exams: Company Secretary Revision Materials

As you are aware the Bar Council has an examination called All India Bar Exams (AIBE) for qualified lawyers who are interested in practising law in Courts across India.  For that purpose, the Bar Council with Rainmaker has created wonderful preparatory materials.  The content are ample enough to cover important provisions.  It is the best reference material for Drafting paper in CS Professional Program and General Law in CS Executive Program, just read to get maximum marks in exams.  It will of good help for Revision too before CS exams or any CA/CWA exams where you study the following laws:

Crisp Law for Exams - 1

Download Link for Book 1: http://www.barcouncilofindia.org/wp-content/uploads/2010/08/AIBEP1.pdf

Crisp Law for Exams - 2

Download Link for Book 2: http://www.barcouncilofindia.org/wp-content/uploads/2010/08/AIBEP2.pdf

Reference Materials for CS Foundation Programme

In the above refer Chapter No. 4 for Elements of Business Laws paper.

Reference Materials for CS Executive Programme

Module 1: General & Commercial Law (GCL): Chapter Nos. 1, 2, 3, 4, 6, 8, 11, 18.

Module 2: Company Law: Chapter No. 13.

Economic & Labour Laws: Chapter Nos.  14 & 17.

Reference Materials for CS Professional Programme

Module 1: Company Secretarial Practice (CSP): Chapter No. 13.

Drafting, Appearances & Pleadings (DAP):  Chapter Nos. 1,2,3,7.

The materials are shared only for the purpose of study and not for any other purpose.

For Executive Program: http://yehseeyes.blogspot.com/2007/10/cs-inter-reference-materials.html
For Professional Program: http://yehseeyes.blogspot.com/2010/01/books-for-cs-professional-program-on.html

For Hindi Medium: http://yehseeyes.blogspot.com/2011/09/company-secretary-hindi-medium-books-on.html

THOSE WHO ARE UNABLE TO DOWNLOAD FROM ABOVE, CAN READ PART I & II FROM BELOW:

AIBEP1

AIBEP2

Saturday, June 11, 2011

Company secretary June 2011 exam question paper for CS (ACS) Executive Programme

Glance through Company Secretary June 2011 exam questions papers now.

Wednesday, March 16, 2011

RBI's Annual Return extends beyond FDI & ODI to Foreign Assets & Liabilities, capturing reverse investments & info based on OFBV valuation

New Annual Return on Foreign Assets & Liabilities

To be filed with RBI on or before 15th July every year

Replacing the erstwhile requirement of filing Part B of FC-GPR

RBI has replaced Part B of the Form FC-GPR by a separate ‘Annual Return on Foreign Liabilities and Assets’ given as Annex-I. The return should be submitted by July 15 of every year to the Director, Balance of Payment Statistics Division, Department of Statistics and Information Management (DSIM), Reserve Bank of India, C-9, 8th floor, Bandra Kurla Complex, Bandra (E), Mumbai - 400 051. Further, the return should be submitted by all the Indian companies which have received FDI and/or made ODI abroad (i.e. overseas investment) in the previous year(s) including the current year. The Annex –II gives the concepts and definitions useful in filling the Annual Return on Foreign Liabilities and Assets. Remember, Part -A of FC-GPR remains as such.

Circular: A.P. (DIR Series) Circular No. 45 dated 15th March 2011 and is applicable with immediate effect from July 2011 onwards. & Definitions.

This requirement is to enable International Monetary Fund (IMF) for the purpose of compiling information to be used in the compilation of India’s Balance of Payments (BoP), International Investment Position (IIP), Coordinated Direct Investment and Coordinated Portfolio Investment. Hence, the formats are ensured to collect such COMPREHENSIVE & DETAILED information with proper definitions for various aspects. Interestingly, apart from the Audited Financials which needs to be annexed to the Annual Return, there is only a certification by Authorised official of the company.


It has the following sections:

1. Section I: Identification Particulars

· Block 1A : Total Paid up Capital of Indian Company

· Block 1B : Free Reserves & Surplus and Retained Profit

2. Section II: FOREIGN LIABILITIES

Investments made under Foreign Direct Investment (FDI) scheme in India:

· Block 2A: Foreign Direct Investment in India (10% or more Equity Participation

· Block 2B: Foreign Direct Investment in India (Less than 10% Equity Holding

Portfolio and Other Liabilities to Non-residents (i.e. position with unrelated parties)

· Block 3A: Portfolio Investment

· Block 3C: Other Investments: (like External Commercial Borrowings)This Other investment is a residual category that includes all financial outstanding not considered as direct investment or portfolio investment (outstanding liabilities with Unrelated Parties).

3. Section –III: FOREIGN ASSETS

· Block 4: Direct Investment Abroad under Overseas Direct Investment Scheme

· Block 4A: Direct Investment Abroad (10 % or more Equity holding

· Portfolio and Other Assets Abroad (i.e., position with unrelated parties)

· Block 5A: Portfolio Investment Abroad

· Block 5B: Financial Derivatives (with non-resident entities only)

· Block 5C: Other Investment (Outstanding claims on Unrelated Parties)

· Block 6: Equity Capital, Free Reserves & Surplus of Direct Investment Enterprise Abroad

[Please report here the total equity, the equity held by your company and the total free reserves & surplus of those nonresident enterprises in each of which your company held 10 per cent or more shares on the reporting date].

· Block 7: Contingent Foreign Liabilities

· Block 8: Employee Information of reporting Indian company

NEW CONCEPTS

Reverse Investment is defined and needs to be reported. It is when where the recipient of investment (being an Indian company) also holds LESS THAN 10% shares in the investor (in case of FDI into India). Same way, in case of ODI from India, the reverse investment is when the recipient of investment (being a foreign company) also holds LESS THAN 10% shares in the investor (being an Indian company).

Methodology for valuation of foreign liabilities and foreign assets:

• Debt securities should be valued at market price, while all other types of debt, viz., loan, trade credit, deposits, other accounts payable/ receivable should be valued at nominal value.

• For the valuation of the outstanding investment, use the corresponding endMarch/ end-December market price/exchange rate.

• For listed companies, the share price on the closing date of reporting period should be used for valuation of Equity.

• For unlisted companies, use the concept of "Own Funds at Book Value (OFBV)" for valuation of Equity, to have consistency in valuation. OFBV reflects the value of enterprise recorded in the book of Direct Investment Enterprise. To put in simple terms, OFBV is based on the books of the direct investment enterprise and can be seen on its balance sheet as shareholder‘s equity. The definition of OFBV contains paid-up capital, all types of reserves and net value of non distributed profits and losses (including result for the current year).

Example for OFBV:

Suppose company's paid up capital = Rs 250 lakh, with FDI 50 % (i.e. Rs 125 lakh)

Accumulated reinvested earnings = Rs 75 lakh

Revaluation of land & shares = Rs 159 lakh

Total = Rs 484 lakh

Therefore, Equity investment by foreign direct investor based on OFBV method is Rs 242 lakhs (50 per cent of Rs.484 lakh).

Enjoy filing Annual Return after reading the Definitions.

Wednesday, February 16, 2011

Tax law, Company law, Economic & Labour law Updates for June 2011 Company Secretaries exam as on February 2011 - ICSI Bulletin

CS Bulletin updation for Tax law (Assessment year & updates), Company law (Additional Filing Fees), Economic & Labour law (Competition law case) for June 2011 Company Secretaries exam as on February 2011.  Do read for both Company Secretary Executive & Professional Programme exams.

ICSI Directorate of Academic & Professional Development

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The Commission found that these practices constituted abuse by Intel of its dominant position on the x86 CPU market that harmed consumers throughout the European Economic Area.  By undermining its competitors ability to compete on the merits of their products, Intel’s actions undermined competition & innovation.  The CCI has also ordered Intel to cease ongoing abusive practices immediately.

A brief analysis of Intel case under Competition Act, 2002:

  • In the above mentioned case the relevant market is ‘Relevant Product Market’ and to be more specific, ‘Computer Chip Market’.
  • The dominance is abused on the grounds of ‘Denial of Market Access’ which is listed as one of the grounds of abuse of dominance, u/s. 4(2)(c) of Competition Act, 2002.

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Enjoy passing!!!

Monday, January 3, 2011

Learnlabz on FEMA for Company Secretary exam revision (CS Executive & Professional Program), understand Foreign Exchange Management Act, 1999

Learnlabz distributed Company Secretary Exam revision DVD’s outside CS Exam Centres at Chennai and it was nice to get students reviews out of the Exam hall.

We were glad that lot of CS exam writers used OnlyThisMuch books and thier feedback after writing the exams was remarkable.

Enjoy watching the same VIDEO online now…. (Playlist contains 8 videos)

 

 

Source: www.youtube.com/learnlabz or http://www.youtube.com/view_play_list?p=D7FE18DDD7B99345 

Do share your listening and recapitulating experience!!!

OTM Challenge 2011 is on…Take your challenge now…

Enjoy passing.

Saturday, August 7, 2010

Issue or Transfer of shares under FEMA: No more CCI guidelines pricing but Discounted Cash Flow technique for valuation: certification by Merchant banker/Chartered Accountant

Issue of shares

(a) After issue of shares (including bonus and shares issued on rights basis) and shares issued under ESOP)/ convertible debentures / convertible preference shares, the Indian company has to file Form FC-GPR, enclosed in Annex - 8, through it’s AD Category I bank, not later than 30 days from the date of issue of shares. The Form can also be downloaded from the Reserve Bank's website http://www.rbi.org.in/Scripts/BS_ViewFemaForms.aspx. Non-compliance with the above provision would be reckoned as a contravention under FEMA and could attract penal provisions.

Issue Price (for all issues other than Rights Issue)

  • Price of shares issued to persons resident outside India under the FDI Scheme, shall be on the basis of SEBI guidelines in case of listed companies.
  • In case of unlisted companies, valuation of shares has to be done by a SEBI registered Category I Merchant Banker or a Chartered Accountant as per the Discounted Free Cash Flow Method (DCF) .
  • In case of issue of shares on preferential allotment the price shall not be less that the price as applicable to transfer of shares from resident to non-resident.

Issue Price (for Rights Issue)

  • Listed = @ the price determined by the Company.
  • Unlisted = Minimum price is the Rights Issue price to resident shareholders.

Transfer of Shares

Reporting of transfer of shares between residents and non-residents and vice- versa is to be made in Form FC-TRS (enclosed in Annex - 9). The Form FC-TRS should be submitted to the AD Category – I bank, within 60 days from the date of receipt of the amount of consideration. The onus of submission of the Form FC-TRS within the given timeframe would be on the transferor / transferee, resident in India. The AD Category – I bank, should forward the same to its link office. The link office should consolidate the Form FC-TRS and submit a monthly report to the Reserve Bank.

Transfer Price

  1. Transfer by Resident to Non-resident (i.e. to foreign national, NRI, FII and incorporated non-resident entity other than erstwhile OCB)
    • Listed = Minimum price as per Preferential Issue under SEBI ICDR regulation with date of purchase/sale as relevant date.
    • Unlisted = Minimum price as per Fair value under Discounted Cash Flow Method and certified by Merchant Banker or Chartered Accountant.
  2. Transfer by Non-resident (i.e. by incorporated non-resident entity, erstwhile OCB, foreign national, NRI and FII) to Resident
    • Should be within Minimum price as said in Transfer by Resident to Non-Resident above (for all issues).

Updated Notifications

  1. Foreign Exchange Management (Transfer or Issue of Security by a PersonResident Outside India) (Amendment) Regulations, 2010
  2. A. P. (DIR Series) Circular No.49 dated 4th May 2009

  3. Foreign Investment Master Circular July2010

New definition of factory, dependant, Appointment of specialist, Medical Benefit council, Social Security Officers, Appeal provisions, 5 year limitation period, Other beneficiaries scheme - ESI Amendment Act, 2010

ESI Act was amended by Employees State Insurance Amendment Act, 2010 by way of Gazette notification dated 25th May 2010 and its effective date is notified as 1st June 2010 with the following updates.

Section 1(5): The appropriate Government may, in consultation with the Corporation and where the appropriate Government is a State Government, with the approval of the Central Government, after giving one month (earlier it was six months') notice of its intention of so doing by notification in the Official Gazette, extend the provision of this Act or any of them, to any other establishment or class of establishments, industrial, commercial, agriculture or otherwise :

Section 2(6A) "dependant" means any of the following relatives of a deceased insured person, namely :-

(i) a widow, a minor legitimate or adopted son who has not attained the age of 25 years, an unmarried legitimate or adopted daughter;

(ii) if wholly dependent on the earnings of the insured person at the time of his death, a legitimate or adopted son or daughter who has attained the age of 25 years (not eighteen years) and is infirm;

Section 2(6A): “Employee” definition also includes only such persons engaged as apprentice whose training period is extended to any length of time.

Section 2(11) "family" means all or any of the following relatives of an insured person, namely :

(v) dependant parent whose income from all sources does not exceed such income as may be prescribed by CG.

(vi) in case the insured person is UNMARRIED & his/her parents is not alive, a minor brother/sister WHOLLY dependant on the earnings of the insured person.

Section 2(12): "factory" means any premises including the precincts thereof -
(a) whereon ten or more persons are employed or were employed for wages on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on with the aid of power or is ordinarily so carried on, or (b) whereon twenty or more persons are employed or were employed for wages on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on without the aid of power or is ordinarily so carried on, but does not include a mine subject to the operation of the Mines Act, 1952 (35 of 1952) or a railway running shed.

Section 10. MEDICAL BENEFIT COUNCIL. - (1) The Central Government shall constitute a Medical Benefit Council consisting of - (a) the Director General, ESIC, ex officio as Chairman;

(b) the Director General, Health Services, ex officio as Chairman.

Section 12(3) A person referred to in clause (i) of section 4 [3 members of Parliament of whom two shall be members of the House of the People (Lok Sabha) and one shall be a member of the Council of States (Rajya Sabha) elected respectively by the members of the House of the people and the members of the Council of States] shall cease to be a member of the Corporation,

  • on becoming a Minister or Speaker or Deputy Speaker of the House of the people or the Deputy Chairman of the Council of States.
  • when he ceases to be a member of Parliament.

2nd provisio to Section 17(2)(a) dealing with Staff of ESIC allows appointment of Consultants & Specialists in various fields on contract basis.

Section 37. VALUATION OF ASSETS AND LIABILITIES. – The ESI Corporation shall, at intervals of 3 years (not five years), have a valuation of its assets and liabilities made by a valuer appointed with the approval of the Central Government.

Section 45. INSPECTORS, THEIR FUNCTIONS AND DUTIES: ESI Inspectors are now called Social Security Officers (SSO). Further, any authorised ESIC officer may carry out test inspection or re-inspection of the records & returns u/s. 44 for the purpose of verifying correctness & quality of inspection.

Second Proviso  to Section 45A: In case of determination of contribution u/s. 45, the ESI Corporation power is limited to 5 years of contribution becoming due. [limitation period]

Section 45AA: Appeal to Appellate Authority can be preferred by employee for order u/s. 45A within 60 days by depositing 25% of contribution (ordered or as per own calculation - whichever is higher), which is refundable with interest on success of appeal.

Section 51E: An accident occurring to an employee while commuting from his residence to the place of employment for duty or from the place of employment to his residence after performing duty, shall be deemed to have arisen out of and in the course of employment if nexus between the circumstances, time and place in which the accident occurred and the employment is established. [Agnes v. BEST Corpn case is now a law]

Third proviso to Section 56 amended: Medical Benefit:

Provided also that an insured person, who has attained the age of superannuation, a person who retires under Voluntary Retirement Scheme (VRS) or takes premature retirement, and his spouse shall be eligible to receive medical benefit subject to payment of contribution and such other conditions as may be prescribed by the Central Government.

Section 58(5): State Government, with prior approval of Central Government, can also establish organisation to provide for sickness, maternity & employment injury.

Section 59(3): ESIC’s Hospital through Third party participation is now permitted.  So, now even a private hospital can be recognised for medical treatments.

Section 59B: ESIC is given permission to establish medical colleges, nursing colleges & training institutes for its paramedical staff & employees.

Existing Chapter VA is completely revised

  • Section 73B gives overriding power to Central Government to frame Scheme by way of Notification, for other beneficiaries (not being insured) for providing medical facility on payment of user charges.
  • Scheme shall have the details as per Section 73D and shall be laid in both houses of Parliament for 30 days.

Provisios added to Section 87: Exempted factory or establishment by which,

  • it is mandated that exemption will be granted only if employees receive substantially similar or superior benefits.
  • Application for renewal shall be made within 3 months before expiry of Exemption period and taken up by Government within 2 months.

Section 91A powers restricted.  Thus now, exemption may be granted only prospectively and not retrospectively.

Section 91AA: Central Government is the appropriate Government if the medical benefits are provided by ESIC.

Source: Notification

Thursday, August 5, 2010

Overriding Clarification on Classification of Manufacture & Service Industries under Micro Small Medium Enterprises Act issued by MSME Ministry

Categorisation of activities under manufacture or service under the MSMED Act, 2006

This always remained as a moot point, while categorising under MSMED Act, which provides different limits (link) for manufacturing and servicing industries.

Now, the Ministry of Micro, Small & Medium Enterprises has given a CLARIFICATION in supersession of all other circulars that:

A)    Activities considered as manufacturing :

  1. (i)                  Medical Equipment and Ayurvedic Product
  2. (ii)                Composite unit of Bacon Processing and Piggery Farm (Piggary Farm without bacon processing shall not be classified either as manufacturing or as service enterprise because this is farming activity)
  3. (iii)               Tobacco Processing
  4. (iv)              Beedi/ Cigarette manufacturing and other tobacco products
  5. (v)                Extraction of Agave Spirit from Agave juice (imported medicinal plant) extraction of Agave
  6. (vi)              Manufacture of Bio-fertilizer

B)     Activities considered as Service :

  1. (i)                  Sanitation Services (Hiring of Septic Tank Cleaner)
  2. (ii)                Clinical Pathological Laboratories and scanning, MRI Tests
  3. (iii)               Hospitals
  4. (iv)              Agri – clinic and Agri – Business
  5. (v)                Restaurants with Bar
  6. (vi)              Canteens
  7. (vii)             Motel industry

The activity “Bee Keeping” is a farming allied activity and therefore, would not be covered in either manufacturing or service activity.

Source: No.5(6)/2/2009-MSME POL dated 21/07/2009

As you know [MSMED]Small Scale Industry definition only under MSMED Act for IDRA too.

To understand all the notifications of industry, read Industries DIPP updates

Violated Foreign Exchange laws: on becoming aware of the contravention, disclose it to RBI to save huge penalty of 2 lakhs or 3 times the amount involved in transaction [Compounding Master Circular]

It has been decided to put in place an updated procedure for compounding of contravention/s under FEMA on the basis of observations made over the last few years on the compounding process on a continuous basis and the experience gained in dealing with compounding applications. The objective is rationalization and streamlining of the process and the procedure for compounding and to enhance transparency and effect smooth implementation of the compounding process. The directions contained in the compounding of contravention/s issued vide A.P. (DIR Series) Circular No.31 dated February 1, 2005 are superseded by this circular vide A.P. (DIR Series) Circular No. 56 dated 28th June 2010 and as provided in Master Circular on Compounding of Contraventions under FEMA, 1999 read with Foreign Exchange (Compounding Proceedings) Rules, 2000 (the Rules).  Further, Operational checkpoints for submission of a compounding application and the related matters are also given.

 

When an application is made for compounding of a contravention, the RBI would examine the nature of contravention in the following manner:
• whether the contravention is technical and/or minor in nature and needs only an administrative cautionary advice;
• whether the contravention is serious and warrants compounding of the contravention; and
• whether the contravention, prima facie, involves money-laundering, national and security concerns involving serious infringements of the regulatory framework. In such a case, RBI may order necessary investigation.

Investigation by Enforcement Directorate (ED)
If RBI finds that it is necessary for further investigation, it may recommend the matter to the Directorate of Enforcement (DoE) for further investigation. Such action may be initiated under FEMA, 1999 by the Enforcement Directorate or the Anti Money Laundering Authority instituted under the Prevention of Money Laundering Act, 2002 or to any other agencies, as RBI may deem fit.

Time Frame for Disposing of Compounding Application
RBI states that applications for compounding will be disposed of in 180 days. If investigation as aforesaid is necessary, compounding will not take place. The application will be returned to the Applicant.

Factors Considered for determining the compounding fee
• The amount of gain or unfair advantage;
• The amount of loss caused to the exchequer;
• The economic benefits accruing to the contravener due to delayed compliance;
• The repetitive nature of contravention by the contravener;
• The conduct of contravener in disclosure of information; and
• Such other matter in the opinion of RBI will be the factors on the basis of which the application will be examined.

Time Frame for Payment of Compounding Fee
The amount payable by the contravener as per the compounding order should be paid within 15 days from the date of the order. If the contravener fails to pay the said amount then it will be deemed that the contravener has never applied for compounding of offence.

Repeated Offences <= 3years
A similar offence within 3 years of the compounding of the earlier offence shall not be compoundable.  Any second or subsequent contravention committed after the expiry of a period of three years from the date on which the contravention was previously compounded shall be deemed to be a first contravention.


Certificate after Compounding
RBI will issue a certificate to the contravener subject to the conditions of the compounding order after realization of the amount paid as per the compounding order.

Within 12 months of Export of Goods and Software, Realise & Repatriate export Proceeds till 31st March 2011 now with Master Circular

Export of Goods and Software – Realisation and Repatriation of export proceeds – Liberalisation as per A.P. (DIR Series) Circular No.57 dated 29th June 2010

Attention of Authorised Dealer Category-I (AD Category-I) banks is invited to A.P.(DIR Series) Circular No.70 dated June 30, 2009 increasing the period of realisation and repatriation to India of the amount representing the full export value of goods or software exported, from six months to twelve months from the date of export, subject to review after one year.

The issue has since been reviewed and it has been decided, in consultation with the Government of India, to extend the above relaxation up to March 31, 2011.

To understand the updated version in this regard: Master Circular on Export of Goods and Services

Money Laundering Amendment 2010 with insertion of explanation along with updated Master Circular

Prevention of Money-laundering (Maintenance of Records of the Nature and Value of Transactions, the Procedure and Manner of Maintaining and Time for Furnishing Information and Verification and Maintenance of Records of the Identity of the Clients of the Banking Companies, Financial Institutions and Intermediaries) Second Amendment Rules, 2010- Obligation of banks as per DBOD. AML. BC. No. 113 /14 .01.001/2009-10 dated 29th June 2010.

In the Prevention of Money-laundering (Maintenance of Records of the Nature and Value of Transactions, the Procedure and Manner of Maintaining and Time for Furnishing Information and Verification and Maintenance of Records of the Identity of the Clients of the Banking Companies, Financial Institutions and Intermediaries) Rules, 2005:-

An explanation is added to "suspicious transaction" definition: In rule 2 in sub-rule (1), after clause (g), the following Explanation shall be inserted, namely:-
"Explanation:- Transaction involving financing of the activities relating to terrorism includes transaction involving funds suspected to be linked or related to, or to be used for terrorism, terrorist act or by a terrorist.

 

Further, in Rule 9, the existing sub-rules (1A,B,C,D) are replaced and some Explanation in added in Rule 10.

For full details, kindly refer the Updated Master Circular – Know Your Customer (KYC) norms / Anti-Money Laundering (AML) standards/Combating of Financing of Terrorism (CFT)/Obligation of banks under PMLA, 2002

No surrender of the proportionate export incentives under FTP Export Schemes even if proceeds are not realised within 6/12 months

Export of Goods and Services - Unrealised export bills –Write-off - Surrender of export incentives
Attention of Authorised Dealer Category – I (AD Category –I) banks is invited to A.P. (DIR Series) Circular No. 12 dated September 09, 2000, A.P. (DIR Series) Circular No. 30 dated April 04, 2001, A.P. (DIR Series) Circular No. 61 dated December 14, 2002, A.P. (DIR Series) Circular No. 40 dated December 05, 2003 and A.P. (DIR Series) Circular No. 33 dated February 28, 2007, in terms of which the AD Category –I banks have been permitted to accede to the requests for "write-off" made by the exporters, subject to the conditions, inter alia, that the exporter had to surrender proportionate export incentives, if availed of, in respect of the relative shipments.

 

It has since been announced in the Foreign Trade Policy (FTP) 2009-14 and specified in Para. 2.25.4 of Handbook of Procedures – Vol. I (2009-2014) (extracts annexed), issued by the Department of Commerce, Ministry of Commerce and Industry that realisation of export proceeds shall not be insisted upon, under any of the Export Promotion Schemes under the Foreign Trade Policy (FTP), subject to the following conditions:-
i) the write-off on the basis of merits is allowed by the Reserve Bank or by the AD Category – I banks on behalf of the Reserve Bank, as per the extant guidelines;
ii) the exporter produces a certificate from the Foreign Mission of India concerned, about the fact of non-recovery of export proceeds from the buyer; and
iii) this would not be applicable in self-write-off cases.
The above relaxation is applicable for the exports made with effect from August 27, 2009.

It is clarified that since the Drawback scheme is governed by the provisions of the Customs Act, 1962 and the Rules made there under, the provisions contained in para. 2.25.4 of the Handbook of Procedure – Vol. I. of the Foreign Trade Policy (FTP) (2009-2014) would not be applicable to the Duty Drawback scheme. Therefore, the drawback amount has to be recovered even if the claim is settled by the Export Credit Guarantee Corporation of India Limited (ECGC) or the write –off is allowed by the Reserve Bank.

Accordingly, the AD Category –I banks are advised not to insist on the surrender of the proportionate export incentives, other than under the Duty Drawback scheme, if availed of, by the exporter under any of the Export Promotion Schemes under the FTP 2009-14, subject to the fulfilment of conditions as stated above.

 

Source: A.P. (DIR Series) Circular No.03 dated 22nd July 2010

Takeout Financing: refinancing of domestic Rupee loans with ECB under RBI approval route

As per the extant norms, refinancing of domestic Rupee loans with External Commercial Borrowing (ECB) is not permitted. However, keeping in view the special funding needs of the infrastructure sector, it has been decided to review the ECB policy and put in place a scheme of take-out finance. Accordingly, it has been decided to permit take-out financing arrangement through ECB, under the approval route, for refinancing of Rupee loans availed of from the domestic banks by eligible borrowers in the sea port and airport, roads including bridges and power sectors for the development of new projects, subject to the following conditions:

  1. The corporate developing the infrastructure project should have a tripartite agreement with domestic banks and overseas recognized lenders for take-out of the loan within three years of the scheduled Commercial Operation Date (COD). The scheduled date of occurrence of the take-out should be clearly mentioned in the agreement.
  2. The loan should have a minimum average maturity period of 7 years.
  3. The domestic bank financing the infrastructure project should comply with the extant prudential norms relating to take-out financing.
  4. The fee payable to the overseas lender until the take-out shall not exceed 100 bps per annum.
  5. On take-out, the residual loan agreed to be taken- out by the overseas lender would be considered as ECB and the loan should be designated in a convertible foreign currency and all extant norms relating to ECB should be complied with, including the reporting arrangements.
  6. Domestic banks / Financial Institutions will not be permitted to guarantee the take-out finance and further it will not be allowed to carry any obligation on its balance sheet after the occurrence of the take-out event.

Source: A.P.(DIR Series) Circular No.04 dated 22nd July 2010

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