27 Aug 2019

After years of defiance, the Board of Control for Cricket in India (BCCI) seems to have finally caved in by agreeing to come under the ambit of National Anti-Doping Agency (NADA) to avoid isolating itself from the global sports fraternity. Going forward, (subject to official confirmation) like any other athletes of other sports federations, Indian cricket players would be subject to World Anti-Doping Agency’s (WADA’s) Anti-Doping Code. Though there has been no official confirmation to that effect from either side, it seems that there is no way out for BCCI anymore.>>

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16 Aug 2019

The Hon’ble Supreme Court, in a recent judgement, answered the question of whether “special allowances” would fall within the expression “basic wages” for Provident Fund (PF) contribution in the affirmative. Interpreting the provisions of Employees Provident Funds and Miscellaneous Provisions Act, 1952 (“PF Act”) as a beneficial social welfare legislation, the Court affirmed the PF authorities’ factual conclusion that the allowances in question were essentially a part of the basic wage camouflaged as part of an allowance so as to avoid deduction and contribution to the provident fund account of the employees. In essence, the Court reiterated the principle laid down in prior rulings that where the wage is universally, necessarily and ordinarily paid to all across the board, such emoluments are basic wages and employers had to expressly prove the special treatment in the special allowance for it to be kept out of the purview of calculations for PF purposes.>>

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12 Aug 2019

The government has introduced a slew of tax measures in the union budget 2019 directed at taxing rich individuals and entities. One of these measures was the proposal to levy tax on listed companies when they buy back shares from the shareholders. The imposition of 20% tax on share buyback which was earlier applicable only to unlisted companies drew in a lot of flak and concerns from corporate giants. The stipulation was brought in as an anti-abuse provision to discourage buyback of shares and encourage dividend distribution to shareholders in case of surplus earnings by a companyThere was a feeling that listed companies took to the buy-back route to avoid paying the dividend distribution tax (DDT) pegged at an effective rate of 20.5576%. Therefore, it was deemed essential to plug this loophole that corporates were exploring to evade taxes. However, it is unfair to look at the corporate action of share buyback from such a narrow perspective. Apart from being a tax saving option, buyback also increases earnings per share of the company, avail positive debt-equity ratio and facilitates an exit route to shareholders. On that account, the government needs to issue clarification regarding the applicability of the announcement to existing buyback proposals and other legal implications of the same >>

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03 Jan 2019

The Department of Industrial Policy & Promotion (DIPP) released a Press Note on 26th December, 2018 (“Press Note”), which brought out major changes to foreign investment in E-Commerce Sector. The changes made, which have been slated to be brought into effect from 1st February, 2019, will trigger a significant shake-up for the major e-com players like Amazon and Flipkart.>>

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09 Oct 2018

The Companies (Prospectus and Allotment of Securities) Third Amendment Rules, 2018 (hereinafter “Rule(s)”) was published in the official gazette on 10th September, 2018 which is effective from 02nd October 2018. According to the Rules, the Ministry of Corporate Affairs, Govt. of India (hereinafter “MCA”) has mandated that every unlisted public company shall issue its securities only in dematerialised form and shall dematerialise all its existing securities as well.>>

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03 Oct 2018

Issuance of non-convertible debentures (NCDs) is one of most widely used methods through which companies have been raising money in the form of secured debt under private placement route. The issuance of NCDs are governed primarily through Sections 42 and 71 of the Companies Act, 2013 (‘Act’) read with the Companies (Prospectus and Allotment of Securities) Rules, 2014 (“Securities Rules”) and the Companies (Share Capital and Debentures) Rules, 2014 (“Debenture Rules”). The Ministry of Corporate Affairs recently issued the Companies (Prospectus and Allotment of Securities) Second Amendment Rules, 2018 (“Amendment Rule”) on 7th August, 2018, which brought out various changes to the rules in relation to issuance of securities under private placement method.>>

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17 Sep 2018

The status of the Home buyers under Insolvency and Bankruptcy Code (IBC) has been puzzling adjudicating authorities. The question was brought to forefront in public interest writ petition filed before Supreme Court[1] seeking relief for home buyers in Jaypee insolvency matter[2].  Apex Court initially granted stay and later directed that resolution plan should protect the interest of home buyers.>>

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07 Sep 2018

The Ministry of Civil Aviation of Government of India on 27th August 2018 issued Civil Aviation Requirements (CAR) for drones announced as Drone Regulations 1.0.  This Requirements would be effective from 1st December 2018.  The purpose of this regulation is to enable safe and commercial usage of civil drones, and is titled “Requirements for operation of civil remotely piloted aircraft systems (RPAS).  The erstwhile position of the Government by a notice dated 7th October 2014 was that Drones were banned.  Thereafter, draft of the drone Requirements was issued by DGCA on 21/04/2016 and thereafter on 01/11/2017.  With this Civil Aviation Requirements, private and commercial operation of drones are legal with a “No permission, no take off” policy.>>

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06 Sep 2018

The genesis of Foreign Portfolio Investor (FPI) can be traced to SEBI (Foreign Portfolio Investors) Regulations, 2014 (FPI Regulations). FPI Regulations consolidated the investments of foreigners in Indian Capital Market which was till then scattered under Foreign Institutional Investors and Qualified Foreign Investor route. The object clause of the FPI Regulations state that it is to put in place a framework for registration and procedures with regard to foreign investors who propose to make portfolio investment in India.>>

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06 Aug 2018

Yet another attempt has been made by the legislative authorities to reduce the number of frivolous cases and expedite the disposal of cases on dishonour of cheques by amending the Negotiable Instruments Act, 1881 (“Act”) to provide interim relief to the genuine/bona-fide complaints. The amendment is an attempt to help trade and commerce in general by allowing lending institutions, including banks, to continue to extend financial support to the productive sectors of economy.>>

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