General Circular No. 13/2007 Dated 27/09/2007 - Section 141 of the Companies Act, 1956 regarding extension of time for filing documents by companies and levy of additional fee

The final position is http://yehseeyes.blogspot.com/2008/07/companies-acte-form-8-within-30-days-of.html

The Hon'ble Company Law Board has allowed the petition and passed an order dated 1.8.2007 which is re-produced as follow:

"The Central Government, through the Secretary, Ministry of Corporate Affairs, has filed this instant application under Section 141 of the Companies Act, 1956 seeking for directions of this Board to permit Registrars of Companies to condone the delay beyond the prescribed period of 60 days and 30 days from the date of registration/modification and satisfaction of charges respectively. I heard the representatives of the Central Government. Presently, the power to condone delay rests with this Board in terms of Section 141 of the Act. Even though, this power has been sought to be conferred on the Central Government by the Companies (Second Amendment) Act, 2002, the same has not been notified due to pendency of proceedings before the Supreme Court. The power exercised by this Board under Section 141 is purely procedural and very rarely any adjudicatory issue arises. In other words, there has been hardly any legal issue requiring application of mind is involved in disposal of the applications under Section 141. Taking this aspect into consideration and also the fact that a lot of time, efforts and money are involved in prosecuting an application under Section 141, I find justification in the application of the Central Government. Accordingly it is directed as follows:

(1) In cases where there are no disputes, the Central Government is authorised to accept registration/modification/satisfaction of charge up to a period of 300 days from the dates of events.

(2) Additional fees as prescribed in terms of Section 611(2) of the Act shall be levied for the delay beyond 30 days. The Central Government shall notify a slab system of levying additional fee up to 300 days.

(3) Since the very purpose of the application is to avoid time and efforts, the Central Government may ensusre that MCA-21 system accepts the documents on payment of additional fees so that physical approach to ROC for registration can be avoided.

(4) These directions will be effective from a date to be notified by the Central Government.

(5) All the applications pending with the Company Law Board as on the date of Notification by the Central Government shall be disposed of by the respective Regional Benches as hereto before.

(6) However the present system of filing applications before the Company Law Board in terms of Section 141 will continue in respect of:

a. where the delay is beyond 300 days from the dates of events;

b. Rectification of register of charges; and

c. when documents are sought to be filed by the lenders.

(7) The Central Government shall send a copy of this order to all Regional Directors/Registrars of Companies and Regional Benches of the Company Law Board."

Pursuant to the order dated 01.08.2007 passed by the Company Law Board as reproduced above, following decisions have been taken for implementation of the said order:-

(i) The aforesaid order shall take effect from the 27th October, 2007.

(ii) Documents under the defined categories for registration/ modification/ satisfaction of charge, excepting those mentioned under Para 6 of the order, shall be accepted for filing under MCA 21 system up to 300 days from the event date with effect from 27 ^th October,2007.

(iii) The Registrar of Companies shall register the documents so filed in cases where: (a) there are no disputes and (b) there is an omission in filing of the particulars or the registration/ modification of the charge or in giving of intimation of payment or satisfaction thereof within a period of 60 days and 30 days respectively, up to a period not exceeding 300 days from the date of event by levying additional fee prescribed in section 611(2) i.e. not exceeding ten times the amount of fee specified in Schedule X.

(iv) All applications pending with the Company Law Board, prior to the effective date i.e. the 27^th of October, 2007 for extension of time in omission of filing of the particulars or the registration/ modification of the charge or for the giving of intimation of payment or satisfaction thereof within a period of 60 days and 30 days respectively, shall be disposed of by the respective Regional Benches as hereto before.

(v) Documents filed on the portal (www.mca.gov.in), prior to the effective date i.e. the 27^th of October, 2007 for registration /modification of the charge or for the giving of intimation of payment or satisfaction thereof after a period of 60 days and 30 days respectively, shall not be registered by the concerned Registrar until the delay is condoned by the respective Regional Benches as hereto before.

(vi) The present system of filing applications before the Company Law Board in terms of Section 141 shall continue in respect of all other matters except for extension of time in omission of filing of the particulars of the registration/ modification of the charge or for the giving of intimation of payment or satisfaction thereof up to a period not exceeding 300 days from the date of event.

(vii) The slab system for levy of additional fees, pursuant to para (2) of the order of the CLB referred to above, in terms of section 611(2) shall be as per Ministry's Press note No.2 dated 21-3-1995 as may be amended from time to time.

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Amendment - Companies Act - Extention of 300 Days for registeration of Creation / Statisfaction of Charge U/s 125/138

Dear All,

The final position is http://yehseeyes.blogspot.com/2008/07/companies-acte-form-8-within-30-days-of.html

As we all know that in the case of creation of charge as per Section 125 of the Companies Act, 1956 we need to register a charge within 30 days next immediately following the expiry of the initial period of 30 days on payment of additional fee in terms of Section 611(2). The same provisions are applicable to the modification of charges under Section 135. However, in the case of satisfaction the facility of extension of period of 30 days is not available to the Registrar for the registration of satisfaction of charges under Section 138 of the Act.

The powers to condone the delay and grant extension for filing these documents beyond a period of 60 days or 30 days, as the case may be, vest in the Company Law Board (CLB) in terms of provisions contained in Section 141 of the Act.

It was observed with the implementation of e filing under MCA-21 e-governance programme that a large number of applications are required to be filed with the CLB for condonation of delay beyond the period of 60 days.

In consideration of the time and costs involved in pursuing these applications with the CLB, the Ministry of Corporate Affairs filed a petition before the CLB seeking appropriate directions to allow the Central Government to extend the time, in cases where filing of the particulars or the registration/ modification of the charge or the intimation of payment or satisfaction thereof does not take place within a period of 60 days and 30 days respectively, up to a period not exceeding 300 days from the date of event, on levy of additional fee prescribed under section 611(2).

The Hon'ble Company Law Board has allowed the petition and passed an order dated 1.8.2007.

Also find attached relevant circular issued by Ministry of Corporate Affairs for your perusal.

Thanks & Regards

Alagar

09884731993

SECURITIES CONCEPTS TO DIGEST

American Depository Receipts (ADR) (U.S.)

A certificate issued in the United States in lieu of a foreign security. The original securities are lodged in Bank/Custodian abroad, and the American Depository Receipts (ADRs) are traded in the US for all intents and purposes as if they were a domestic stock. An ADR dividend is paid in US dollars, so it provides a way for American investors to buy foreign securities without having to go abroad, and without having to switch in and out of foreign currencies.

Global Depository Receipts

Any instrument in the form of a depository receipt or certificate (by whatever name it is called) created by the Overseas Depository Bank outside India and issued to non-resident investors against the issue of ordinary shares or Foreign Currency Convertible Bonds of issuing company.

Indian Depository Receipt

A receipt, evidencing an underlying foreign security, issued in India by a foreign company which has entered into an agreement with the issuer and depository, custodian and depository or underwriters and depository, in accordance with the terms of prospectus or letter of offer, as may be prescribed.

Bonus Shares

Shares issued by companies to their shareholders free of cost by capitalization of accumulated reserves from the profits earned in the earlier years.

Cumulative Convertible Preference Shares

A type of preference shares where the dividend payable on the same accumulates, if not paid. After a specified date, these shares will be converted into equity capital of the company.

Participating Preference Shares

The right of certain preference shareholders to participate in profits after a specified fixed dividend contracted for is paid. Participation right is linked with the quantum of dividend paid on the equity shares over and above a particular specified level.

Grey Knight

One who offers to buy shares of the bidding company as an aid to the defence.

White Knight (U.S.)

A friendly bidder, willing to offer more for a target share than an existing hostile bidder to rescue a company that is about to fall into the hands of an unwelcome suitor. They are usually persuaded by the company that is subject to a hostile bid to come to its rescue.

Insider

Any person who, is or was connected with the company or is deemed to have been connected with the company, and who is reasonably expected to have access, connection, to unpublished price sensitive information in respect of securities of a company, or who has received or has had access to such unpublished price sensitive information

Insider trading

Practice of corporate agents buying or selling their corporation's securities without disclosing to the public significant information which is known to them but which has not yet affected the price.

Market capitalization

The market value of a company, calculated by multiplying the number of shares issued and outstanding by their current market price.

Merchant Banker

Any person who is engaged in the business of issue management either by making arrangement regarding selling, buying or subscribing to securities or acting as manager, consultant, adviser or rendering corporate advisory service in relation to such issue management.

Price sensitive information

Any information, which relates directly or indirectly to a company and which if published, is likely to materially affect the price of securities of the company.

Preferential allotment

Further issue of shares / securities convertible into equity shares at a later date, to a select group of persons in preference to all the existing shareholders of the company.

Tender Offer

Tender offer means an offer by a company to buy back its specified securities through a letter of offer from the holders of the specified securities of the company.

Stakeholder

Any individual or group who has an interest in a firm; in addition to shareholders and bondholders, includes labor, consumers, suppliers, the local community and so on.

Warrant

An options contract often sold with another security. For instance, corporate bonds may be sold with warrants to buy common stock of that corporation. Warrants are generally detachable.

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Trezrrr every pulsss
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B Smart to Take Over

Credit to takeovercode.com

1.What is meant by Takeovers & Substantial acquisition of shares?

When an "acquirer" takes over the control of the "target company", it is termed as Takeover. When an acquirer acquires "substantial quantity of shares or voting rights" of the Target Company, it results into substantial acquisition of shares. The term "Substantial" which is used in this context has been clarified subsequently.

2.What is a Target company?

A Target company is a listed company i.e. whose shares are listed on any stock exchange and whose shares or voting rights are acquired/ being acquired or whose control is taken over/being taken over by an acquirer.

3.Who is an Acquirer?

An Acquirer means (includes persons acting in concert (PAC) with him) any individual/company/any other legal entity which intends to acquire or acquires substantial quantity of shares or voting rights of target company or acquires or agrees to acquire control over the target company.

4.What is meant by the term "Persons Acting in Concert (PACs)"

PACs are individual(s) /company(ies)/ any other legal entity(ies) who are acting together for a common objective or for a purpose of substantial acquisition of shares or voting rights or gaining control over the target company pursuant to an agreement or understanding whether formal or informal. Acting in concert would imply co-operation, co-ordination for acquisition of voting rights or control. This co-operation/ co-ordinated approach may either be direct or indirect.
The concept of PAC assumes significance in the context of substantial acquisition of shares since it is possible for an acquirer to acquire shares or voting rights in a company "in concert" with any other person in such a manner that the acquisition made by them may remain individually below the threshold limit but may collectively exceed the threshold limit.
Unless the contrary is established certain entities are deemed to be persons acting in concert like companies with its holding company or subsidiary company, mutual funds with its sponsor / trustee/ Asset management company, etc.

5.How substantial quantity of shares or voting rights is defined?

The SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 has defined substantial quantity of shares or voting rights distinctly for two different purposes:
I. Threshold of disclosure to be made by acquirer(s):
1) 5% and more shares or voting rights: A person who, alongwith PAC, if any, (collectively referred to as " Acquirer" hereinafter) acquires shares or voting rights (which when taken together with his existing holding) would entitle him to more than 5% or 10% or 14% shares or voting rights of target company, is required to disclose at every stage the aggregate of his shareholding to the target company and the Stock Exchanges within 2 days of acquisition or receipt of intimation of allotment of shares.
2) Any person who holds more than 15% but less than 55% shares or voting rights of target company, and who purchases or sells shares aggregating to 2% or more shall within 2 days disclose such purchase/ sale along with the aggregate of his shareholding to the target company and the Stock Exchanges.
3) Any person who holds more than 15% shares or voting rights of target company and a promoter and person having control over the target company, shall within 21 days from the financial year ending March 31 as well as the record date fixed for the purpose of dividend declaration, disclose every year his aggregate shareholding to the target company.
4) The Target company, in turn, is required to inform all the stock exchanges where the shares of target company are listed, every year within 30 days from the financial year ending March 31 as well as the record date fixed for the purpose of dividend declaration.

(II) Trigger point for making an open offer by an acquirer
1) 15% shares or voting rights:
An acquirer who intends to acquire shares which alongwith his existing shareholding would entitle him to exercise 15% or more voting rights, can acquire such additional shares only after making a public announcement (PA) to acquire atleast additional 20% of the voting capital of target company from the shareholders through an open offer.
2) Creeping acquisition limit:
An acquirer who holds 15% or more but less than 55% of shares or voting rights of a target company, can acquire such additional shares as would entitle him to exercise more than 5% of the voting rights in any financial year ending March 31 only after making a public announcement to acquire atleast additional 20% shares of target company from the shareholders through an open offer.
3) Consolidation of holding:
An acquirer who holds 55% or more but less than 75% shares or voting rights of a target company, can acquire further shares or voting rights only after making a public announcement to acquire atleast additional 20% shares of target company from the shareholders through an open offer.

6.How is "control" defined?

Control includes the right to appoint directly or indirectly or by virtue of agreements or in any other manner majority of directors on the Board of the target company or to control management or policy decisions affecting the target company. However, in case there are two or more persons in control over the target company the cesser of any one of such persons from such control shall not be deemed to be a change in control of management nor shall any change in the nature and quantum of control amongst them constitute change in control of management provided this transfer is done in terms of Reg. 3(1)(e). Also if consequent upon change in control of the target company in accordance with regulation 3, the control acquired is equal to or less than the control exercised by person (s) prior to such acquisition of control, such control shall not be deemed to be a change in control.

7.What is a Public Announcement (PA)?

A public announcement is an announcement made in the newspapers by the acquirer primarily disclosing his intention to acquire shares of the target company from existing shareholders by means of an open offer.

8.What are the disclosures required to be made under Public Announcement?

The disclosures in the announcement include the offer price, number of shares to be acquired from the public, identity of acquirer, purpose of acquisition, future plans of acquirer, if any, regarding the target company, change in control over the target company, if any, the procedure to be followed by acquirer in accepting the shares tendered by the shareholders and the period within which all the formalities pertaining to the offer would be completed.

9.What is the objective of Public Announcement?

The Public Announcement is made to ensure that the shareholders of the target company are aware of an exit opportunity available to them.

10.Can Acquirer make an offer for less than 20% of shares?

No, the acquirer cannot make an offer for less than 20% of shares. The acquirer has to make an offer for a minimum of 20% (less only in specified cases).

11.Who is required to make a Public Announcement and when is the Public Announcement required to be made?

The Acquirer is required to appoint a Merchant Banker (MB) registered with SEBI before making a PA . PA is required to be made through the said MB. The acquirer is required to make the P.A within four working days of the entering into an agreement to acquire shares or deciding to acquire shares/ voting rights of target company or after any such change or changes as would result in change in control over the target company.
In case of indirect acquisition or change in control, the PA shall be made by the acquirer within three months of consummation of such acquisition or change in control or restructuring of the parent or the company holding shares of or control over the target company in India. The offer price in such cases shall be determined with reference to the date of the public announcement for the parent company and the date of the public announcement for acquisition of shares of the target company, whichever is higher, in accordance with the parameters mentioned in the Takeover Regulations.

Chinese Walls

Artificial barriers to the flow of information set up in large firms to prevent the movement of sensitive information between departments.

Escrow account

The trust account established by a broker under the provisions of the license law for the purpose of holding funds on behalf of the broker's principal or some other person until the consummation or termination of a transaction

Hostile Bid

An effort to gain control of a target company that has not been agreed to by the target's management and board, usually through a tender offer or an unsolicited proposal to the board. Sometimes called an unsolicited bid.

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Vj
Trezrrr every pulsss
http://yehseeyes.blogspot.com/ thisisvj@gmail.com

Check Cheque

DISHONOUR OF CHEQUE- What to Do

Thanks to CSMysore
Q1. What can I do when a cheque is dishonoured for the reason of insufficient funds. What legal action I can take to get the amount cleared?

A. On the dishonour of a cheque, one can file a suit for recovery of the cheque amount along with the cost & interest under order XXXVII of Code of Civil Procedure 1908 ( which is a summary procedure and) can also file a Criminal Complaint u/s 138 of Negotiable Instrument Act for punishment to the signatory of the cheque for haring committed an offence. However, before filing the said complaint a statutory notice is liable to be given to the other party.

Q2. I have got my cheque dishonoured few months back. It was issued by a Company. What can I do now?

A. On the dishonour of cheque by the company you can file a suit for recovery of the amount under Order XXXVII of CPC. As you have stated that cheques were dishonoured few months back and you have issued no notice to the company bringing to their knowledge the dishonour of cheques and the life of the cheque is still valid which is usually six months from the date of issue. You please present the cheque again and on receipt of the information about the dishonour of the cheque you immediately issue notice within 30 days from the receipt of the information of dishonour of cheque to the company. If the company does not pay the amount within 30 days from the receipt of the notice, you can file complaint under Section 138 of the Negotiatble Instrument Act. The said complaint is to be filed within one month on the expiry of 30 days period of notice.

Q3. Our is the software distribution co. During course of our business we had supplied software worth Rs.3 lacs. But our client dishonoured the cheque. We have filed court case on him after that he paid us Rs. 1 lac and then he has run away. We do not have any idea about his where about. Court has issued proclaimed offender notice, but we do not now how to trace him. He has closed his account and bankers are not cooperating with information like his other address. Pleas advice?

A. Let the proceedings of declaration of proclaimed Offender be completed. The accused will be declared Proclaimed Offender and can be arrested at any time. At this stage, you can not do anything else. However, simultaneously you can file Suit for Recovery with the last known address of the accused.

Q4. I have a cheque dishonoured. I have informed the person in writing, but no response, what should be done to register a case of cheating, and which place it should be filed? The place of the bank, where the cheque was dishonoured or the place where the cheque was handed?

A. When you have informed the person about the dishonour of the cheque, in case the information is given within 30 days from the dishonour of the cheque, you can file a Complaint under Section 138 of Negotiable Instrument Act within one month after the expiry of notice period of 30 days. The Complaint for cheating is not maintainable legally. However, in certain cases the police have been registering cases of cheating against the accused.

Q5. I have blank cheques given to me by a partnership firm. Since they owe me some money which I had given to them as a loan. Besides the cheques and the statement of accounts. I do not have anything else. Suppose one day, I suddenly get to know that they have closed the partnership firm and dissolved it, Can I deposit the cheques now and legally raise a claim on them and how?

A. You should fill the cheques and present for encashment. The Partnership Firm as well as partners are personally liable and even after dissolution also the firm and partners are liable. Once the cheques are dishonoured you have to file a suit for recovery of the said amount under the summary procedure provided in Order 37 of Code of Civil Procedure, 1908. You should also file a complaint under Section 138 of the Negotiable Instruments Act. For this you will have to first give a notice, within 30 days of the dishonouring of the cheques. Then if payment is not made within 30 days of receipt of notice a complaint has to be filed within 30 days thereafter.

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FEMA - Overseas Investment - Liberalization

Dear All,

Further to my email on the captioned subject, the RBI vide its AP DIR Circular No.11 & 12 dated 26 ^th Sept 2007 has amended Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004. This Regulation is dealing with overseas investments have been further liberalized, with immediate effect, as under:

1.Enhancement of limit for Overseas Direct Investment

As per Current provisions of Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004, the total overseas investment of an Indian party in all its Joint Ventures (JVs) and / or Wholly Owned Subsidiaries (WOSs) abroad engaged in any bonafide business activity should not exceed 300 per cent of its net worth for companies incorporated in India or bodies created under an Act of Parliament and 200 per cent of net worth in the case of registered partnership firms, under the automatic route.

With a view to provide greater flexibility to Indian parties for investments abroad, the existing limit of 300 per cent of the net worth of the Indian party (200 per cent in case of registered partnership firms) has been enhanced to 400 per cent of the net worth of the Indian party as on the date of the last audited balance sheet. This new enhanced limit will be applicable for both the Indian Companies and Indian Registered Partnership firm(Including Investment in Financial Services).

2. Portfolio Investment by Listed Indian Companies

As per Current provisions of Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004, listed Indian companies are permitted to invest up to 35 per cent of their net worth as on the date of its last audited balance sheet, in the equity of listed foreign companies, which are listed on a recognised stock exchange and having shareholding of at least 10 per cent in Indian companies listed on a recognised stock exchange in India and rated bonds / fixed income securities issued by overseas companies, under the portfolio investment scheme.

In order to provide greater opportunities to listed Indian companies for portfolio investments , the existing limit of 35 per cent has been enhanced to 50 per cent of the net worth of the listed Indian company as on the date of its last audited balance sheet. It has also been decided to do away with the requirement of a reciprocal 10 per cent share holding in Indian companies with immediate effect .

Accordingly, listed Indian companies are now permitted to invest up to 50 per cent of their net worth as on the date of its last audited balance sheet, in (i) shares and, (ii) rated bonds / fixed income securities, rated not below investment grade by accredited/registered credit rating agencies, issued by listed overseas companies. All other terms and conditions stipulated in Regulation 6B of the Notification shall remain unchanged.

3. Overseas Investment by Mutual Funds

Enhancement of the Aggregate Ceiling

The aggregate ceiling for overseas investment by Mutual Funds, registered with SEBI, has been enhanced from USD 4 billion to USD 5 billion with immediate effect. The existing facility to allow a limited number of qualified Indian Mutual Funds to invest cumulatively up to USD 1 billion in overseas Exchange Traded Funds, as may be permitted by the SEBI, shall continue.

Further Avenues for Overseas Investment

Mutual Funds, registered with SEBI are presently permitted to invest in ADRs / GDRs of Indian and foreign companies, rated debt instruments not below investment grade by accredited/registered credit rating agencies, in the equity of overseas companies listed on a recognized stock exchange overseas, in overseas mutual funds that make nominal investments (say to the extent of 10 per cent of net asset value) in unlisted overseas securities, and overseas exchange traded funds that invest in securities. In order to enable the Mutual Funds to tap a larger investible stock overseas, it has been decided to allow Mutual Funds also to invest in additional instruments, subject to the guidelines issued by SEBI.

Accordingly, the Mutual Funds registered with SEBI, are permitted to invest in:

i) ADRs / GDRs issued by Indian or foreign companies;

ii) Equity of overseas companies listed on recognized stock exchanges overseas;

iii) Initial and follow on public offerings for listing at recognized stock exchanges overseas;

iv) Foreign debt securities in the countries with fully convertible currencies, short term as well as long term debt instruments with rating not below investment grade by accredited / registered credit rating agencies;

v) Money market instruments rated not below investment grade;

vi) repos in the form of investment, where the counterparty is rated not below investment grade. The repos should not, however, involve any borrowing of funds by mutual funds;

vii) Government securities where the countries are rated not below investment grade;

viii) Derivatives traded on recognized stock exchanges overseas only for hedging and portfolio balancing with underlying as securities;

ix) Short term deposits with banks overseas where the issuer is rated not below investment grade;

x) Units / securities issued by overseas Mutual Funds or Unit Trusts registered with overseas regulators and investing in (a) aforesaid securities, (b) Real Estate Investment Trusts (REITs) listed in recognized stock exchanges overseas, or (c) unlisted overseas securities (not exceeding 10 per cent of their net assets).

Thanks & Regards

Alagar

0988471993

2 more Public Financial Institution

NOTIFICATION No. s.o. 1583 (E) dated 20-9-2007

In exercise of the powers conferred by sub-section (2) of section 4A of the Companies Act, 1956 (1 of 1956), the Central Government hereby specifies the following institutions to be public financial institutions and for that purpose makes the following further amendment in the Notification of the Government of India, published in the Gazette of India dated the 13th May, 1978 in Part II, section 3, sub-section (ii), in the erstwhile Ministry of Law, Justice and Company Affairs (Department of Company Affairs) vide number S.O. 1329 dated the 8th May, 1978, namely:--

In the said notification, after serial number 49, the following serial numbers and entries relating thereto shall be added, namely:--

''50. Tamil Nadu Urban Finance and Infrastructure Development Corporation Limited.

51. Kerala Power Finance Corporation Limited."

[F. No. 3/3/2004/CL.V]

Credits to CSMysore

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Vj
Trezrrr every pulsss
http://yehseeyes.blogspot.com/

RBI & ITS CONTROL ON COMMERCIAL BANKS

The Reserve Bank of India (RBI)

RBI ACT 1934 – to regulate the issue of bank notes & keeping reserves, to secure monetary stability in India & to operate currency credit system to its advantage.

v RBI & COMMERCIAL BANKS – RELATIONSHIP:

1) Supervisory & controlling authority over banks: S-22 to issue licenses; S-23 previous approval of RBI for new branches.

2) Inspection: Suo motto or as per CG. The Central Government (CG) may order prohibiting fresh deposit or direct RBI to wind up.

3) Power to issue directions: S-21 to regulate advances, rates, etc…

4) Control over Top Management: S-36:- Remove/terminate/appoint with RBI approval, the manager, CEO, chairman, etc…

v ORGANISATIONAL STRUCUTRE:

The Central Board of Directors who acts as CEO/Governor & <= 4 Deputy Governor; 4directors nominated by Central Government (CG) with 10other directors & 1 Government of India (GOI) official.

v RBI – LIQUID ADJUSTMENT FACILITY (LAF):

LAF allows RBI to adjust in system depending on its monetary policy stance & its reading of country's macro economic fundamentals. LAF operated through Repos & Reverse Repos in order to set a corridor for money market interest rates.

The rates that influence the conditions in money market are,

REPO or floor rate: @ which RBI is willing to borrow money against security; it is flexible & reflect market conditions; it SQUEEZES the liquidity.

REVERSE REPO or cap rate or Bank's re-finance: lending against security held by banks; it INJECTS liquidity.

Thus, LAF is the same day auction & settlement system.

v INTERVENTION IN FOREIGN EXCHANGE BY RBI –

It is to stabilise rupee by buying & selling in foreign exchange market. The choices include, Foreign exchange intervention, International Policy Co-ordination & Capital controls.

The currency intervention (sterilised/un-sterilised) is to dampen the volatility & to prevent misalignment. The un-sterilised intervention is to affect the size of money supply. The sterilised intervention is the effect of changes in money supply offset through Open Market Operation (Sell forex & Buy G-sec).

The objective includes,

Ø Reflection of economic fundamentals in external value of rupee;

Ø Reduce excess volatility in exchange rates;

Ø Help maintaining an adequate level of forex reserves;

Ø Help eliminating market constraints.

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Vj
Trezrrr every pulsss
http://yehseeyes.blogspot.com/

The entire gamut of Management Audit, thats it

FINANCIAL AUDIT ends where MANAGEMENT AUDIT begins;
Subset of MANAGEMENT AUDIT is OPERATIONAL AUDIT;
OPERATIONAL AUDIT is the extension of INTERNAL AUDIT;
INTERNAL AUDIT complements FINANCIAL AUDIT.

Check this !

Interesting & Important Notifications/Cases

CREDIT TO ICSI MYSORE NEWSLETTER http://www.esnips.com/web/icsimysore

Customs

Ø Determination of origin of goods

The Central Government has released the Rules of Determination of Origin of Goods under the Preferential Trading Agreement between India and Chile.

Customs Notification No. 84/2007-Cus. Dt 17/08/07 (NT)

Ø Exemption of additional duty of customs

The Central Government has exempted electronic integrated circuits falling under Customs Tariff Heading 8542 from payment of additional duty of customs in lieu of Sales Tax/VAT.

Customs Notification No. 93/2007-Cus. Dt 08/08/07

Ø HSN-Most suitable for classification

The Tribunal has held that the Explanatory Notes to the internationally recognized and accepted Harmonised System of Nomenclature (HSN) are most suitable for the determination of the customs classification of a product.

Hotel Leela Ventures Ltd. Vs. CC (2007 (145) ECR 222)

FTP

Ø Bank Certificate Not required

The Director General of Foreign Trade (DGFT) has deleted the requirement for filing of a bank certificate related to the financial soundness of the exporter filing an application for grant of Registration cum Membership Certificate (RCMC).

DGFT Public Notice No. 25 (RE-2007)/2004- 09, dt.23/07/07

Ø Procedural change in reimbursement of CST

The Central Government has made changes in the procedures relating to re-imbursement of Central Sales Tax for supplies made to 100% Export Oriented Units (EOU) and Units in Electronic Hardware Technology Park (EHTP) and Software Technology Park (STP).

Public Notice No. 39 (RE-2007)/2004 -2009,dt.24/07/2007

Ø Amendment of FTP

The High Court of Calcutta has held that the Foreign Trade Policy can only be amended by notifications published in the Official Gazette and not otherwise. Further, the High Court has held that the Foreign Trade (Development and Regulation) Act, 1992 does not authorize the Central Government to amend the export and import policy with retrospective effect.

Soubhik Exports Ltd. Vs. Union of India (2007 (214) ELT 334)

Antidumping Duty

Ø Anti-dumping duty has been imposed on the following products:

§ bias tyres, tubes and flaps originating in or exported from the People.s Republic of China and Thailand.

§ hexamine originating in or exported from Russia and Saudi Arabia.

§ partially oriented yarn, originating in or exported from People.s Republic of China.

§ nonylphenol originating in or exported from Chinese Taipei.

Customs Notification Nos. 88/2007 dt. 24/07/2007, 89/2007 dt. 25/07/2007,92/2007 dt. 03/08/2007 & 94/2007 dt.22/08/2007

Ø The Antidumping Duty levied on partially oriented yarn, originating in or exported from the Republic of Korea and Turkey, has been withdrawn.

Customs Notification 95/2007 dt. 22/08/2007

ESI

Ø ESI medical services are covered under consumer protection Act

The medical service rendered in an ESI hospital/dispensary to an insured employee fails with in the ambit of section 2(1) (o) of the Consumer Protection Act, and, therefore, the Consumer Protection Act have jurisdiction to adjudicate upon a dispute arising between the insured and the Employees. State Insurance Corporation.

Chairman, Employees. State Insurance Corporation,2007

LLR 740

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Interesting Act in Banking, now you will believe...

BANKER'S BOOKS EVIDENCE ACT, 1891

Gives mode of proving of entries in bank's book & production in courts.

Indian Evidence Act: so long as the original document is available, a copy cannot be produced. The exception being production of a certified copy of a document permitted by law.

"Bankers book" include ledgers, cash books, day books, account books & all other books used in the ordinary business of a bank & all other books used in the ordinary business of a bank.

S - 2(8): "Certified copy" means a copy of entry in the books of bank, with Certificate written at the foot of such copy that it is true copy of such entry, that such entry is contained in one of the ordinary books of bank & was made in the usual & ordinary course of business & that such book is still in the custody of the bank, & where the copy was obtained by mechanical/other process, which in itself ensure the accuracy of the copy, a further certificate to that effect but where the book from which such copy was prepared has been destroyed in the usual course of bank's business after the date on which the copy had been so prepared, a further certificate to that effect, each such certificate being dated & subscribed by the Principal accountant or manager of the bank with his name & official title.

Now, enjoy the same…

Entry with Certificate.

True Copy.

Ordinary books & Ordinary course under custody. Ensure accuracy, if by process.

Certificate after copy destroyed in the usual course.

Certificate to be dated subscribed by A/C't or Manager.

 

SECTION 4: A certified copy of any entry in banker's book is the prima facie evidence of existence of such entry & the matters, transactions, & accounts recorded therein recorded as, the original entry itself is now by law admissible BUT NOT FURTHER/OTHERWISE.

GAUHATI BANK LTD : entries in books of accounts shall not alone be sufficient evidence to charge any person with liability. It is a mere corroborative evidence.

SECTION 5: ONLY for order of court/judge make a special cause, an officer of bank be compelled to produce any banker's book or to appear as a witness to prove matters in any legal proceeding to which bank is not a party.

Criminal Procedure Code: an officer in charge of police station can compel a bank officer to produce the books without order of court.

"Legal Proceeding" means

·

Any proceeding/inquiry in which evidence is/may be given;

·

An arbitration; &

·

Investigation/Inquiry for evidence by police officer of Magistrate authorised person.

SECTION 6:

1. On application of any party to a legal proceeding, the court/judge may order to inspect & take copies of banker's books or the bank to prepare & produce the certified copies along with a certificate that "no other entries relevant was found in the books";

2. Order with or without summoning the bank & 3-clear days service;

3. Either offer to produce or SCN against order, within time limited for obedience.

SECTION 7:

1. Cost of application of doing under the act as per the discretion of court/judge who may further order to be paid by bank, if fault on the part of bank;

2. Enforced, as if the bank is a party to the proceedings;

3. Order as if it were the decree for money paid by itself.

SECTION 8: Order of court/judge for production & inspection of books of banks, an order by officer ranking not below Superintendent of Police.

Chota sa, nanha sa, pyara sa.... act hai nah !

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Trezrrr every pulsss
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