15 - Legal & Regulation Updates - India

	SEBI Board Meeting
	The SEBI Board met in Jaipur on 15th January 2017 and took decisions to carry out amendments in the above-mentioned legislations
	SEBI (Foreign Portfolio Investors) (Amendment) Regulations, 2017
	SEBI via Notification dated January 12, 2017 has amended the SEBI (Foreign Portfolio Investors) Regulations, 2014.
	MCA: Companies (Incorporation) Fifth Amendment Rules, 2016
	The Ministry of Corporate Affairs (“MCA”) through its Notification dated December 29, 2016 has amended the Companies (Incorporation) Rules, 2014. (“Rules”).
	Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) (Fifteenth Amendment) Regulations, 2016
	New clause shall be inserted after Regulation 6C in the Foreign Exchange Management (Transfer or issue of Security by a Person Resident outside India) Regulations, 2000 namely “6D. Issue of Convertible Notes by startup companies”
	MSME- Implementation of Udyog Aadhar Memorandum
	Every Employer engaged in manufacturing of goods or rendering of services with total investment in plant and machinery to file the memorandum online on the website http://udyogaadhar.gov.in
	NCLT constitutes Special Benches at Mumbai, Delhi & Chandigarh
	The NCLT has constituted Special Benches at the following locations as per dates below to hear matters listed.
	CBDT: Clarifications on the Taxation and Investment Regime for Pradhan Mantri Garib Kalyan Yojana, 2016
	Pradhan Mantri Garib Kalyan Yojana, 2016 provides an opportunity to persons having undisclosed income in the form of cash or deposit in an account to declare such income and pay tax, surcharge and penalty totalling in all to 49.9 percent of such declared income and make a mandatory deposit of not less than 25% of such income in the Pradhan Mantri Garib Kalyan Deposit Scheme, 2016. The Scheme has commenced on 17.12.2016 and shall remain open for deposit up to 31.03.2017. CBDT has issued a clarification regarding the scheme throwing light on the applicability and the declarations that can be made under the scheme. The clarification demarcates the scope of the scheme and provides further comments.
	Payment of contributions & other dues by the employers-Grace period for 5 days for the employers for the month of December 2016
	Payment of contributions & other dues by the employers- Grace period for 5 days for the employers for the month of December 2016 is given. As per the circular grace period of 5 days is allowed for the employers to deposit the contribution and other dues for the month of December 2016 by 20th January 2017. The Payment of contribution to Employees provident Fund Organization and the return in Form 5 shall be submitted by 20th January 2017 as 5 days grace period is allowed for the employers.
	Draft- Maharashtra Factories (1st Amendment) Rules, 2016
	In Rule 57 of The Maharashtra Factories Rules, 1963 after schedule VIII the “Schedule VIII-A is inserted for power press machines. It will be applicable to all types of power press machines including the press brakes, except when used for working hot metal.

	SEBI: Guidelines for participation/functioning of Eligible Foreign Investors (EFIs) and FPIs in International Financial Services Centre (IFSC)
	Pursuant to the announcement made in the Union Budget 2015-16, on Gujarat International Finance Tec-City (“GIFT”), SEBI, after consultation with stakeholders, is in process of laying down requisite regulatory framework for facilitating and regulating financial services relating to IFSC. Subsequently, SEBI has issued IFSC Guidelines, 2015 on March 27, 2015 and has further issued guidelines for functioning of Stock Exchanges and Clearing Corporations in IFSC on November 28, 2016.
	SEBI: Consultation paper proposing amendments/clarifications to the SEBI (Issue and Listing of Debt Securities) Regulations, 2008
	SEBI has issued a Consultation Paper dated January 04, 2017 proposing amendments/clarifications to the existing ILDS Regulations, with an objective to seek comments on the proposal with respect to public issuances of Non-Convertible Debentures having below investment grade credit rating.
	Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Third Amendment) Regulations, 2016
	SEBI has amended Regulation 26 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Third Amendment) Regulations, 2016 through a Notification dated January 5, 2017
	SEBI: Guidance Note on Board Evaluation
	SEBI has issued Circular dated January 05, 2017 relating to Guidance Note on Board of Directors Evaluation in order to provide clarity on the Board Evaluation Process
	Securities and Exchange Board of India (Alternative Investment Fund) (Amendment) Regulations, 2016
	SEBI via Notification dated January 04, 2017 has amended the SEBI (Alternative Investment Fund) (Amendment) Regulations, 2016 (“Regulations”) to ease certain requirements pertaining to Angel Funds
	SEBI: Exclusively listed companies of De-recognized/Non-operational/exited Stock Exchanges placed in the Dissemination Board (DB)
	SEBI has issued a Circular dated January 05, 2017 regarding ELCs of De-recognized/Non-operational/exited Stock Exchanges placed in the DB. This Circular is in furtherance of the previous Circular dated October 10, 2016, which dealt with the exit process of ELCs from the DB of the stock exchanges.
	SEBI (Portfolio Managers) (Amendment) Regulations, 2016
	SEBI via Notification dated December 29, 2016 has amended the SEBI (Portfolio Managers) Regulations, 1993. SEBI has also issued a Public Release to this effect. This amendment shall come into force from January 02, 2017 (i.e. date of publication in the Official Gazette).
	MCA issues exemptions to IFSC Companies
	MCA via Notification dated January 04, 2017 has stated that certain provisions of the Act shall not apply or shall apply to Private and Unlisted Public Companies being set up in International Financial Services Centres (“IFSC”) located in an approved Multi Services Special Economic Zone (“SEZ”) set-up under the Special SEZ Act, 2005 (“IFSC Companies”) with exceptions, modifications and adaptations as prescribed. This Notification shall be applicable to IFSC Companies, which are licensed to operate by the Reserve Bank of India (“RBI”) or Securities and Exchange Board of India (“SEBI”) or the Insurance Regulatory and Development Authority of India (“IRDA”) from the IFSC.
	Income-tax (1st Amendment) Rules, 2017.
	CBDT has made it mandatory for all individuals to submit PAN or Form.60 before 28th February 2017 to their respective banks. This is because it is mandatory for banks to link PAN with Bank Account before the said due date. Further, banks have also been directed to submit information regarding cash deposits during the period 1st  April, 2016, to 9th  November, 2016, in respect of accounts that have seen deposits of more than Rs.2.5 lakh during the demonetization period, i.e, 9th November, 2016 to 30th December, 2016. Lastly, it directs all persons and banks to quote PAN in all the reports submitted to Income Tax.
	Migration of existing Central Excise/ Service tax Assesses to GST
	Under the GST regime, the assesses having a valid PAN shall be granted registration under GST regime on a provisional basis. The Directorate General of Systems, CBEC has made necessary arrangement of communicating these provisional lDs along with passwords to the respective assesses though the ACES portal.( www.aces.gov.in) Further, awareness campaigns and outreach programmes such as seminars and workshops including photographs, of such seminars/workshops will be uploaded  in  the  CBEC’s  Intranet Portal. (https://antarang.icegate.gov.in/communities/login )
	Introduction of Single Window Interface for Custom Clearance of Export Consignments.
	After successful implementation of single-window interface for imports, the revenue department has extended the facility for customs clearance of export consignments. This is done with a view of bringing down transaction cost and encourages convenience. A pilot project for exporters has been initiated from January 5,2017 in Chennai, Delhi and Mumbai for air cargo complexes for CITES (the Convention on International Trade in Endangered Species of Wild Fauna and Flora) and wildlife items. Under this pilot project, shipping bills will be filed online on ICEGATE or through the service centre and will be referred to the concerned agency online for a no-objection certificate (NOC). This will reduce direct interference of government agencies, and reduce time and cost involved in doing business. A list of documents is given in the notification which is to be filed along with online application.
	The Special Economic Zones (Amendment) Rules, 2016
	New rule 5A is inserted which is applicable in  case of a Special Economic Zone, Infrastructure requirements relating to information technology, Bio-technology, Research and Development facilities, Fabless Semi-conductor Industry and Electronic Manufacturing Services. Employer to ensure a) twenty-four hours uninterrupted power supply at stable frequency in the zone; (b) reliable connectivity for uninterrupted and secure data transmission; (c) provision for central air-conditioning system; and (d) a ready to use, furnished plug and pay facility for end users.
	The Contract labour (Regulation and Abolition) (Maharashtra Amendment) Act, 2016
	The Contract Labour (Regulation and Abolition) act, 1970 was applicable to every employer and contractor employing 20 or more workmen as a contract labour. However as per the amendment the act will be applicable on employing 50 or more workmen as contract labour. Aadhaar mandatory for members and pensioners of the Employees'' Pension Scheme
	The Employees'' Provident Funds (Amendment) Scheme, 2017
	Employer for the payment of contribution where there is no branch of the Reserve bank or State Bank of India, shall pay the fund, the amount of contribution through  scheduled banks in India including private sector banks.
	The Tea (Marketing) Control (Amendment) Order, 2017
	As per the amendment there is addition of Certifying authority who will be the Deputy Chairman and definition and compliances related to mini tea factory are added.

	SEBI: Interpretive Letter
	The Securities and Exchange Board of India (“SEBI”) has issued an Interpretive Letter as requested by MarketMagnify Investment Advisers and Research Pvt. Ltd. dated December 22, 2016 under the SEBI (Informal Guidance) Scheme 2003 with regard to SEBI (Investment Adviser) Regulations 2013 (“Regulations”).
	SEBI - Disclosure of financial information in offer document for REITs
	The Securities and Exchange Board of India (“SEBI”) has issued a Circular dated December 26, 2016 pertaining to the requirements of disclosure of financial information in the Offer document for REITs. The brief heads to be covered in the Offer document are financial information of REITs, Projections of REITs Income and Operating Cash flows, Management discussion and analysis of REITs operations, Other Disclosures for REITs which shall include disclosure on Working Capital sufficiency and past market performance, Historical financial information of Manager and Sponsor(s), Framework for calculation of Net Distributable Cash Flows, Principles for preparation of combined Financial Statements, Minimum disclosures for key Financial Statements.
	SEBI: Green Initiative for Filing Form PAS-4 & PAS-5 for Issuance of Debt Securities
	The Securities Exchange Board of India via Circular dated December 23, 2016 has introduced a Green Initiative for submission of record of Private Placement offer by Companies issuing Debt Securities. Rule 14(1) and Rule 14(3) of Companies (Prospectus and Allotment of Securities Rules), 2014 mandates Companies to maintain a complete record of private placement offers in Form PAS-5 and file copy of such record along with the private placement offer letter in Form PAS-4 with the Registrar, and in case of Listed Companies with SEBI within a period of 30 days of circulation of the private placement offer letter.
	MCA: National Company Law Tribunal (Amendment) Rules, 2016
	Ministry of Corporate Affairs (“MCA”) has amended the National Company Law Tribunal Rules, 2016 through a Notification dated December 20, 2016. A bench of the NCLT can now permit multiple persons to present a single petition if it is satisfied, having regard to the cause of action and the nature of relief prayed for, that the petioners have a common interest in the matter. Such permission can be granted where the joining of the petitioners by a single petition is specifically permitted by the Companies Act 2013 (‘Act’).”
	MCA: FAQs on Simplified Proforma for Incorporating Company electronically ("SPICe")
	The Ministry of Corporate Affairs (“MCA”), with a view to guide stakeholders, has issued Frequently Asked Questions (“FAQs”) on SPICe. SPICe has been established with an objective of providing speedy incorporation related services within the stipulated time.
	RBI - Streamlining flow of credit to Micro and Small Enterprises (MSEs) : Additional Working Capital
	Consequent upon withdrawal of legal tender status of Specified Bank Notes (SBN) of 500 and 1000 denominations and based on feedback that some MSEs are facing temporary difficulties in carrying out their normal business due to cash flow mismatches, banks are advised that they may use the facility of providing above ‘additional working capital limit’ (approved by their boards as above) to their MSE borrowers. This would be a onetime measure up to March 31, 2017 and should be normalised in fresh working capital assessment cycle.
	RBI - Prudential Norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances
	Due to withdrawal of the legal tender status of the existing 500 and 1,000 notes, small borrowers needed some more time to repay their loan dues. Taking these representations into consideration, RBI issued a circular, “Prudential Norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances” that provided an additional 60 days beyond what is applicable for the concerned regulated entity(RE) for recognition of a loan account as substandard in certain specified cases. The RBI has further decided to provide an additional 30 days for dues payable between November 1, 2016 and December 31, 2016.
	Introduction of Income-tax (36th Amendment) Rules, 2016
	Rule 67(2) provided for a table which elaborated the manner in which the investable income out of provident fund is to be invested. The Income- tax (36th Amendment) Rules, 2016 has amended the same and provided a new table according to which such income should be invested. “Investible Income” is that income of the provident fund which is not deposited in the Post Office Savings Bank Account in India or in a current account or a Savings Bank Account with any scheduled bank.
	IRDAI: Report of the Implementation Group of Ind AS in Insurance Sector
	As per a press release dated January 18, 2016, insurers/insurance companies are required to prepare Indian Accounting Standard based financial statements for accounting periods beginning from April 1, 2018 onwards with comparatives for the periods ending 31st March 2018 or thereafter. In order to prepare the insurance industry for the same, IRDAI had constituted an Implementation Group (IG) to examine its implications, address the implementation issues and facilitate formulation of operational guidelines to converge with Ind AS. The Implementation Group has submitted its report which is published on the website of IRDAI.
	The Payment of Wages (Amendment) Ordinance, 2016
	Section 6 has been substituted as the payment of wages shall be paid in current coin or currency notes or by cheque or by crediting the wages in the bank account of the employee. However, appropriate State Government can specify the industrial or other establishment or the employer to pay wages to every person employed in such industrial or other establishment by cheque or by crediting the wages in his bank account only.
	Annual Return Submission under Central Labour Laws
	Annual Return under The Payment of Wages Act, 1936, The Minimum Wages Act, 1948, The Contract Labour (Regulation & Abolition) Act,1970, The Inter-State Migrant Workmen (RE&CS) Act, 1979, The Maternity Benefit Act, 1961,The Industrial Disputes Act 1947, The Payment of Bonus Act, 1965, The Building and Other Construction workers (Regulation of Employment & Conditions of Service) Act, 1996. can be unified and be filed online.
	Employees Pension (Seventh Amendment) Scheme, 2016
	The Special provision in respect of Employees Enrolment campaign, 2017, is included, the provisions of the scheme shall apply to the employees whose membership is declared under Paragraph 82A as the employees who were not enrolled as members of the fund for the period beginning from 1st April 2009 to 31st December 2016. The employees will be applicable for remittances in respect of valid declarations under the Employees Enrolment campaign, 2017. The notification will be valid from 1st January 2017 to 31st March 2017.
	Employees'' Provident Funds and Miscellaneous Provisions, Act, 1952
	As the Central Government in the notification has determined 0.01 percent of the aggregate of the basic wages, dearness allowance and retaining allowance to be paid by the employer every month to the Deposit linked insurance to meet the expenses in connection with the administration of Employees Deposit-linked scheme, 1976. The proviso is inserted that the employer only needs to pay the expenses towards the cost of any benefits provided under the Employees Deposit-linked scheme for meeting the expenses in connection with the administration of the scheme, in relation to the employees whose membership is declared as per the Employees Enrolment Campaign, 2017, to the Deposit linked insurance fund. https://innovatorsrace50.com/team/compliance-watcher.html#.WJxAx8FH6A4.gmail