MINISTRY OF CORPORATE AFFAIRS (MCA)
Aviation Ministry, MCA take different flight paths on IBC moratorium
The Ministry of Civil Aviation (MoCA) has requested that leased aircraft be exempted from the asset moratorium rule enforced by India’s Insolvency and Bankruptcy Code (IBC) during the insolvency resolution of an airline, due to fears it could increase leasing costs for all carriers. Despite this, the Ministry of Corporate Affairs (MCA) has opposed the move, claiming it could dissuade investors from submitting resolution plans for insolvent airlines.
Government Mulling Regulatory Measures for Startups
According to reports, the corporate affairs ministry panel, known as the Company Law Committee (CLC), formed in 2019, is likely to look into the possibility of having regulatory measures for start-ups. The need for having a regulatory regime for start-ups is being felt amid instances of concerns being raised over issues related to corporate governance in such entities.
MCA To Withdraw 7,338 Pending Prosecutions In Second Round Of A Special Drive To Cut Litigations
The Ministry of Corporate Affairs (MCA) recently said that it has decided to withdraw 7,338 prosecutions pending before various courts in the second round of a special drive to cut litigations and ensure greater ease of doing business. The move will result in a 21.86% decline in the number of pending prosecutions being pursued by the central government, the ministry said.
RESERVE BANK OF INDIA (RBI)
Directions under Section 35A read with section 56 of the Banking Regulation Act, 1949 (As Applicable to Co-operative Societies) – The National Co-operative Bank Ltd., Bangalore
The Reserve Bank of India (RBI) vide Directive dated July 24, 2023, has issued certain Directions to the National Co-operative Bank Ltd., Bangalore. The bank shall not, without prior approval of RBI in writing grant or renew any loans and advances, make any investment, incur any liability including borrowing of funds and acceptance of fresh deposits, disburse or agree to disburse any payment whether in discharge of its liabilities and obligations or otherwise, enter into any compromise or arrangement and sell, transfer or otherwise dispose of any of its properties or assets except as notified in the RBI Direction dated July 24, 2023 the public.
SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI)
SEBI at an early stage of considering simplification of the process of on-boarding of clients by adoption of risk-based approach
The Securities and Exchange Board of India (SEBI) has recently released a statement clarifying that there is no proposal to curb retail participation in derivative markets. Currently, for trading in the derivative segment, SEBI requires stockbrokers to have documentary evidence of financial capability for all clients. However, SEBI is at an early stage of considering simplifying this process by adopting a risk-based approach. This would mean that the level of documentation required would be based on the risk profile of the client. Read More
Assurance players seek SEBI clarity on ‘overly restrictive’ ESG assurance rule
Top professional services firms have sought clarification from the Securities and Exchange Board of India (SEBI) regarding its recent ESG assurance regulation, which stipulates that the assurance provider or its associates must not sell products or offer any non-audit/non-assurance services, including consulting, to the listed entity or its group entities. The firms provide a variety of permissible and non-conflicting non-audit services like tax, compliances and other advisory services to major companies. They say the regulation prohibits BRSR Core assurance providers from offering permitted services under Section 144 of the Companies Act to their audit clients. Read More
FOREIGN DIRECT INVESTMENT (FDI)
Strategic investment targets initiative: DPIIT identifies 106 companies across sectors from 30 countries
The Department for Promotion of Industry and Internal Trade (DPIIT) has identified as many as 106 companies across sectors from 30 countries under its strategic investment targets initiative, an official said. The initiative is aimed at promoting investments in the country. The government is taking a series of measures such as reducing the compliance burden, easing foreign direct investment norms, rolling out of logistics policy, announcement of production-linked incentive scheme for 14 sectors, and easing procedures through the national single window system to promote investments into the country. Read More
India and Asean top recipients of FDI, says UNCTAD report
The United Nations Conference on Trade and Development (UNCTAD) in its World Investment Report 2023 said that India was the third largest recipient of foreign direct investment (FDI) in greenfield projects in the world in 2022. The FDI flows into India rose 10 percent from $44.7 billion in 2021 to $49.3 billion in 2022. Read More
Nirmala Sitharaman says Indian firms will soon be allowed to directly list their shares overseas
Finance Minister Nirmala Sitharaman has said that Indian companies can now go in for direct listing on foreign exchanges and the International Financial Services Centre (IFSC) in Ahmedabad. The provisions for direct overseas listing were approved by the government, as part of the Covid relief package announced in May 2020, but the rules in this regard are yet to be notified. Read More
REAL ESTATE
Model builder-buyer agreement: Buying a home can get easier soon
In order to speed up the home-buying process and safeguard customers from potential abuses, among other things, the government has decided to form a committee to work on a model buyer agreement. Consumer Affairs Ministry said that the committee, which will include representatives from the Ministry of Consumer Affairs as well as judges, national and state consumer commissions, various consumer bodies, and lawyers, is anticipated to be established within the next three months.
Builders must hand over common area to residents’ association: Karnataka RERA
The Karnataka Real Estate Regulatory Authority (KRERA) recently issued a significant directive to a builder, Signature Dwellings Private Limited, based on a complaint filed by Sandeep GW and Jonali Das. The judgement, given under Section 18 of the Real Estate (Regulation and Development) Act, 2016, instructs the builder to transfer the common area to the association of allottees immediately after the formation of the association. This judgement marks a noteworthy change, as until now, many builders have retained control over common areas in residential apartment complexes without transferring them to the respective associations of allottees.
Delhi HC directs 4B Networks do not sell or transfer its assets
Delhi High Court has inter-alia directed 4B Networks to not sell, transfer, alienate, encumber or otherwise create any third-party rights or interest directly or indirectly in the assets and proprieties of 4B Networks informed in a BSE filing. Read More
INFORMATION TECHNOLOGY (IT)
TRAI recommends independent body to regulate AI
The Telecom Regulatory Authority of India (TRAI) has released a set of recommendations advocating the urgent adoption of a regulatory framework to govern the responsible development of artificial intelligence (AI) across sectors. TRAI’s 10-page report said it was important to regulate specific AI use cases that may have a direct impact on humans within a risk-based framework. TRAI also recommended the establishment of an Artificial Intelligence and Data Authority of India (AIDAI), an independent statutory authority that will act both as a regulator and recommendatory body and play an advisory role for all AI-related domains.
Major digital players may get advice on dos & don’ts
A high-level Committee on the Digital Competition Law is likely to establish a set of “dos and don’ts” for systemically important digital intermediaries, with criteria based on nature of business, turnover, and user base, according to sources. The panel, chaired by Manoj Govil, corporate affairs secretary, will establish these intermediaries to check the ability of big tech to distort fair trade.
ARBITRATION
Panel set up to suggest reforms to Arbitration and Conciliation Act
The government has formed an expert committee to recommend reforms to the Arbitration and Conciliation Act, 1996, and will submit its report within two months, attorney general R Venkataramani informed a five-judge Constitution Bench of the Supreme Court. The issue that requires consideration by the five-judge bench is whether courts can deviate from the agreed procedure of appointing arbitrators under Section 11 of the Act and whether a person, who is ineligible to be an arbitrator, can nominate another person as an arbitrator. The apex court, after taking note of the AG’s submission, deferred the case till September 13.
Insufficiently Stamped Agreement can’t be a ground to set aside Arbitration Award: Delhi High Court
The Delhi High Court, in the matter of “ARG Outlier Media Private Limited vs HT Media Limited”, has ruled that although an Agreement with an arbitration clause must be properly stamped to be admitted as evidence, once the Arbitrator has accepted it and based the award on it, the award cannot be set aside due to insufficient stamping. The court clarified that it does not act as an appellate court against the arbitral award and, therefore, lacks the powers vested in Section 61 of the Indian Stamp Act, which deals with revising decisions on stamp sufficiency. Read More
India Rejects Ruling by Permanent Court of Arbitration in Pakistan Dispute
The Hague’s Permanent Court of Arbitration (PCA) dismissed India’s objections to a Pakistan-initiated procedure concerning water usage in the Indus River basin. This decision reopened a previously blocked procedure that had been on hold for several years. India has stated that it will not participate in the “illegal” proceedings at the Permanent Court of Arbitration over the Kishenganga and Ratle hydropower projects in Kashmir as the dispute is being already examined by a neutral expert under the framework of the Indus Waters Treaty. Read more
FOOD & BEVERAGES
Delhi High Court Directed Delhi Government: Conduct a Survey of All Pending Ration Card Applications for decision on food security and allowances
The Delhi High Court in the case Shabnam v. Government of NCT Delhi And Others observed and has directed the Delhi Government to conduct a survey of all the pending applications for ration cards and also to decide whether the person will be entitled to receive the food security allowance. The court in the case stated that the State Government is directed to conduct the survey of all pending applications to see whether they would be entitled to receive the allowance as stated under Section 8 of the Food Security Act. Read More
INFRASTRUCTURE & CONSTRUCTION
UltraTech joins WEF’s Moving India initiative
UltraTech has announced a major partnership with the World Economic Forum’s (WEF) Moving India initiative, which was introduced at the G20 Energy Ministers’ Meeting in Goa. This initiative, supported by the Indian Ministry of Ports, Shipping and Waterways, and supported by NITI Aayog’s e-FAST India program, aims to establish India’s first zero-emission road freight cluster along the west coast, spanning the states of Gujarat and Maharashtra.
MERGERS & ACQUISITION
CCI seeking more info on AI-Vistara merger is normal, important part of evaluation process: Campbell Wilson
Air India chief Campbell Wilson welcomed the Competition Commission seeking more information on the airline’s proposed merger with Vistara and said it is a “normal and important part of the evaluation process”. The Competition Commission of India (CCI) has asked for more details with respect to the proposed merger, which was announced in November last year, and approval from the regulator was sought in April this year. Read More
Power to appoint Director General (investigation) transferred from MCA to CCI
In a significant move, the Centre has implemented a key provision of the Competition (amendment) Act 2023 that vests power of appointment of Director General (Investigation) in the Competition Commission of India (CCI). So far, the power to appoint DG was vested in the Central Government. Besides implementing this key provision, the Centre has also now concurrently modified existing recruitment rules Competition Commission of India (Director General) Recruitment Rules, 2009 to change the composition of the Search-cum-Selection Committee for appointment of DG. Read More
LIC Mutual Fund Completes Merger with IDBI Mutual Fund
LIC Mutual Fund has completed the takeover of IDBI Mutual Fund and merged schemes with effect from July 29. The move is in line with LIC MF’s mission to strengthen and diversify its product offerings, expand its footprint and grow the assets under management to emerge as a leading player. With this merger, investors invested in IDBI MF schemes will get access to LIC MF’s diversified basket of product offerings covering equity, debt, hybrid, solution-oriented themes, ETF and index funds. Read More
GAMING & CRYPTOCURRENCY
Top investors ask PM Modi to review online gaming tax
A group of 30 Indian and foreign investors, including marquee names such as Indian venture capital firms Kalaari Capital, Peak XV Partners (formerly Sequoia India and South-East Asia) and Lumikai, and US firms Tiger Global Management and Tribe Capital, on Friday wrote to Prime Minister Narendra Modi, seeking a meeting to elucidate the impact of the Goods and Services Tax (GST) Council’s recommendation to tax the online gaming sector at 28% of the gross revenue earned by companies in this sector. The letter claimed that the new recommended tax for the sector could lead to an increase of up to 1,100%, based on the present interpretation of the GST Council’s recommendation to tax real-money online gaming companies at 28% of the “full face value” of their earnings. Read More
Clarificatory amendment to GST Act on online gaming in monsoon session: Revenue Secretary Sanjay Malhotra
Revenue Secretary Sanjay Malhotra has said the central government will bring clarificatory amendments to the GST Act in the monsoon session of Parliament to implement GST Council’s decision of imposing 28% tax on online gaming, casino and horse racing. The monsoon session will begin on July 20 and end on August 11, 2023. The implementation takes effect only when state legislatures have also passed amendments in state GST laws, he said, adding, that it will take some time. Read More
ENERGY LAW
India making great efforts in green growth and energy transition: PM Modi
Addressing via video link the G20 Energy Ministers’ Meeting, Prime Minister Narendra Modi said India is making great efforts in green growth and energy transition, and asserted that the country is moving ahead strongly on its climate commitments. He also said that India has shown leadership in climate action. The world looks up to this G20 group for advanced, sustainable, affordable, inclusive and clean energy transition, he said. Read More
Power ministry’s PSUs sign 15 MoUs on green energy at G20 meet
The Energy Efficiency Services Limited (EESL), a prominent joint venture of Public Sector Undertakings under the Union power ministry, has signed 15 MoUs worth Rs 700 crore, on the sidelines of the recently concluded G20 green energy ministerial in Goa. The event under the aegis of the Clean Energy Ministerial witnessed the exchange of 15 MoUs, to strengthen the EESL’s commitment to exploring innovative solutions for energy access, clean cooking, decarbonisation, and energy efficiency initiatives in India. Read More
World’s biggest wind power projects are in crisis just when world needs them most
Offshore wind projects are facing an economic crisis that erased billions of US dollars in planned spending this week — just as the world needs clean energy more than ever.
A unit of Spain’s Iberdrola SA agreed to cancel a contract to sell power from a planned wind farm off the coast of Massachusetts. Danish developer Orsted A/S lost a bid to provide offshore wind power to Rhode Island, whose main utility said rising costs made the proposal too expensive. Swedish state-owned utility Vattenfall AB scuttled plans for a wind farm off the coast of Britain, citing inflation. Soaring costs are derailing offshore wind projects even as demand for renewable energy soars. Extreme heat driven by climate change is straining electric grids all over the world, underscoring the need for more power generation and adding urgency to calls for a faster transition away from fossil fuels. In Europe, the move to reduce reliance on Russian oil and gas has also given clean-energy projects momentum. Read More
Avaada Energy bags solar project from SECI
Avaada Energy has said it has bagged a 280 megawatt renewable energy project from Solar Energy Corporation of India (SECI). SECI is the nodal agency of the central government for auctioning renewable energy projects. “Avaada Energy has won the 280 MWp project under tariff-based competitive bidding carried out by SECI as a part of SECI’s 2 GW ISTS (inter-state transmission system) connected solar projects (Tranche XI),” the company said in a statement. The bidding allows flexibility to Avaada Energy to set up the solar power project anywhere in India and supply green electricity on long term at a tariff of Rs 2.61/kWh (kilowatt hour). The project will become operational within 18 months from the signing of power purchase agreement (PPA). Read More
INTELLECTUAL PROPERTY LAW
Delhi High Court turns down PepsiCo’s appeal against revocation of potato patent
In a recent development, Delhi High Court judge, Mr. Navin Chawla upheld the decision by the Protection of Plant Varieties and Farmers’ Rights Authority (PPVFRA) and dismissed claims of public interest violation by PepsiCo after the company had tried to patent seeds for a certain type of potatoes which they use to make their famous Lay’s chips. The decision was based on a technicality which dates back to the application based on which the company obtained its certificate. Read More
Delhi High Court restrains Cipla Health from using marks Gluco-C, Gluco-D
Delhi High Court restrained Cipla Health from using the mark Gluco-C or Gluco-D. Zydus Wellness Products, which manufactures and sells energy drink GLUCON-C and GLUCON-D, a combination of Glucose and vitamin D, had alleged that Cipla Health’s Gluco-C and Gluco-D were deceptively similar to its registered trademarks and even the latter’s trade dress infringed its copyright in the trade dress of its GLUCON-D. Read More
Start-ups IPR scheme aimed at promoting innovation
The union minister of state (Independent Charge) for science and technology, Jitendra Singh has said that ‘StartUps Intellectual Property Rights Protection’ scheme is aimed at promoting innovation and entrepreneurship. Government launched the scheme, Startups Intellectual Property Protection (SIPP) for encouraging innovation and creativity of startups. Under the new Trademark Rules, Startups have been given a 50% rebate in filing fees compared to other companies. Even for promotion of registration of Industrial Designs by StartUps as per the new design amendment rules 2021, the government has reduced filing and prosecution fees for small entities. Read More
TAX LAW
50th Meeting of the GST Council
The Central Board of Indirect Taxes and Customs (CBIC) issued Notification to implement the rate changes for specific goods. The 50th GST Council Meeting, held in July 2023, proposed reductions in GST rates for various goods. The amended rates include changes in Schedule I, II, and III, affecting items like uncooked/unfried snack pellets, fish soluble paste, LD slag, imitation zari thread, and metalized yarn. The article also highlights the impacts of these rate changes on different goods and industries. Read More
Home Ministry wants all lottery prize payments to be made via banking channel
The Ministry of Home Affairs has proposed that the prize amount for lottery winners be paid through formal banking channels to prevent tax evasion and money laundering. The ministry has approached the Department of Revenue, the Finance Ministry, and state governments for their views on the matter. Winnings from lotteries or crossword puzzles are subject to Tax Deduction at Source (TDS) under sections 194B and 194G of the Income Tax Act. The Finance Act amended section 194B to include gambling or betting above a threshold of Rs 10,000 for TDS. Read More
