Monthly Archives: October 2013

Simplification & Standardisation of Procedures for Transmission of shares

SEBI has issued a new circular no. CIR/MIRSD/10/2013 dated October 28, 2013 wherein they have further simplified and standardised the procedure for transmission of shares in case of listed companies: 


1) In case of transmission of securities in dematerialized mode, where the securities are held in a single name without a nominee, the existing threshold limit of Rs.1,00,000 (Rupees One lakh only) per beneficiary owner account has now been revised to Rs.5,00,000 (Rupees Five lakh only), for the purpose of following simplified documentation, as already prescribed by the depositories vide bye-laws / operating instructions.

2) In case of transmission of securities in physical mode, where the securities are held in single name without a nominee, the STAs/issuer companies shall follow, in the normal course, the simplified documentation for a threshold limit of ` Rs.2,00,000 (Rupees Two lakh only) per issuer company. However, the Issuer companies, at their discretion, may enhance the value of such securities.

3) The timeline for processing the transmission requests for securities held in dematerialized mode and physical mode shall be 7 days and 21 days respectively, after receipt of the prescribed documents.

Documentary requirement for securities held in physical mode
1. For securities held in single name with a nominee:
i. Duly signed transmission request form by the nominee.
ii. Original or Copy of death certificate duly attested by a Notary Public or by a Gazetted Officer.
iii. Self attested copy of PAN card of the nominee. (Copy of PAN card may be substituted with ID proof in case of residents of Sikkim after collecting address proof)

2. For securities held in single name without a nominee, following additional documents may be sought:
a) Affidavit made on appropriate non judicial stamp paper – to the effect of identification and claim of legal ownership to the securities

b) For value of securities upto ` 2,00,000 (Rupees Two lakh only) per issuer company as on date of application, one or more of the following documents:
i. No objection certificate [NOC] from all legal heir(s) who do not object to such transmission (or) copy of Family Settlement Deed duly notarized or attested by a Gazetted Officer and executed by all the legal heirs of the deceased holder.

ii. Indemnity made on appropriate non judicial stamp paper – indemnifying the STA/Issuer Company.

c) For value of securities more than ` 2,00,000 (Rupees Two lakh only) per issuer company as on date of application:
i. Succession certificate (or) Probate of will (or) Letter of Administration (or) Court decree.

The full circular is available at


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Listing on SME Exchange without public issue

SEBI has issued guidelines whereby small and medium enterprises and start up ventures can list their securities on the Institutional Trading Platform of the SME Exchange without having the need to make a public issue of their securities. Some salient features of the regulations are:

1) The ITP shall be accessible only to informed investors who are either individuals or institutions and the minimum trading lot shall be ten lakh rupees on this platform;

2) the company has atleast one full year’s audited financial statements, for the immediately preceding financial year at the time of making listing application;

3) the company has not completed a period of more than 10 years after incorporation and its revenues have not exceeded one hundred crore rupees in any of the previous financial years;

4) the paid up capital of the company has not exceeded twenty five crore rupees. 

5) the company should have received minimum investment of at least 50 lakh rupees from specified set of investors such as alternative investment fund, venture capital fund, angel investor fund etc. If a registered merchant banker has invested 50 lakh rupees then he must also have done the due diligence for the project;

6) Listing shall not be accompanied by issue of securities or capital raising from public in any manner;

7) Such company may raise capital through private placement or rights issue;

8) In case of rights issue, there shall be no option for renunciation of rights and the articles of association needs to be amended to that effect;

9) Not less than twenty per cent. of the post listing capital of the company shall be held by the promoters at the time of listing and the same shall be locked-in for a period of three years from date of listing.

10) Company listed on the ITP on SME exchange may exit from the platform after following the procedure such as postal ballot in which 90% of total votes and majority of non promoter votes have been cast in favor of the exit and also in principle approval from the SME exchange;

11) The company will be compulsorily required to exit the ITP if it has been listed for more than 10 years, its paid up share capital increases to more than Rs.25 crores, turnover to more than Rs.300 crores in the last audited financial statement or the market capitalisation is more than Rs.500 crores;

12) Company listed on ITP will be delisted and permanently removed if there are instances of non filings for a period of one year, failure to observe corporate governance norms for more than one year;

13) Minimum promoter holding conditions are not applicable to listing on ITP because there is only a listing without any offer of securities to the public. 

The copy of the SEBI circular is available at the SEBI site and at this link



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e-KYC services of UIDAI for insurance companies

IRDA has mandated vide its circular dated 21st October 2013 that e-KYC services of UIDAI can be accepted as valid KYC documents by all the insurance companies. This has been made possible pursuant to the amendment to the Prevention of Money Laundering Act wherein UIDAI identity has been made acceptable for KYC purposes. Further with UIDAI going the e-way by adopting e-UIDAI it is but natural that a boost has been given to the KYC process of UIDAI. IRDA circular is given below


Ref:IRDA/SDD/CIR/AML/207/10/2013 Date:21-10-2013
e-KYC services of UIDAI
Attention is drawn to the following circulars issued by the Authority:
i.      IRDA/F&I/CIR/AML/151 /07/2011 dated July 5, 2011 wherein insurers were informed of the amendments to the Prevention of Money Laundering (Maintenance of Records) Amendment Rules 2010 by which “the letter issued by the Unique Identification Authority of India containing details of name, address and Aadhaar number” was considered as officially valid document that may be obtained as part of Customer Identification Procedure, for the purposes of identification. 
ii.    Master Circular 2010 on AML/CFT guidelines clause 3.1.1 (iv) wherein it has been indicated that “No further documentation is necessary for proof of residence where the document of identity submitted also gives the proof of residence.”
2.         You may be aware that the Unique Identification Authority of India (UIDAI) has  operationalized e-KYC services recently. The acceptability of these services for KYC purposes under the Prevention of Money-laundering (Maintenance of Records) Rules, 2005, was discussed with the Department of Revenue, Ministry of Finance and operational issues were taken up with the insurers.
3.         Now, following confirmation from the Ministry that e-KYC services may be accepted as a valid process for KYC verification under the Prevention of Money-Laundering (Maintenance of Records) Rules, 2005, it has been decided that e-KYC services of UIDAI is acceptable for KYC verification subject to specific and express consent of the customer to access his/her data through UIDAI system.
4.         It may further be noted that in cases where e-KYC services are availed for KYC verification, certification requirements under clause 3.1.1 (iv) of the Master Circular (2010) AML/CFT guidelines shall be deemed to be complied with.
5.         Insurers may take note of the above.
(R.K. Nair)
Member (F&I)


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service tax exemption for factory canteen

The service tax department has vide its notification no. 14/2013 dated 22nd october 2013 exempted “services provided in respect to serving of food or beverages by a canteen maintained in a factory covered under the Factories Act, 1948 and having the facility of air-conditioning or central heating at any time during the year” – so basically it means factory canteens are exempted from the negative provisions of service tax even if they are having air-conditioning or central heating at any time of the year. 

The copy of the notification is given below, since the URL of the service tax is not available for the specific notification.



Government of India
Ministry of Finance 
(Department of Revenue)



Notification No. 14/2013-Service Tax

New Delhi, 22nd October, 2013


G.S.R.____ (E).- In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994,  (32 of 1994),  the Central Government, being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No.25/2012-Service Tax, dated the 20th June, 2012, namely:-


            In the said notification, in the opening paragraph, after entry 19, the following entry shall be inserted, namely:-


“19A. Services provided in relation to serving of food or beverages by a canteen maintained  in a factory covered under the Factories Act, 1948 (63 of 1948), having the facility of air-conditioning or central air-heating at any time during the year.”.


[F. No. B1/13/2013-TRU]


(Akshay Joshi)
Under Secretary to the Government of India 



Note.- The principal notification was published in the Gazette of India, vide notification No.25/2012-Service Tax, dated the 20th June, 2012, vide G.S.R.467(E), dated the 20th June, 2012 and was last amended by notification No.13/2013-Service Tax, dated the 10th September, 2013 vide G.S.R.616(E), dated the 10th September, 2013.




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Branch liberalisation Policy

In a major move to boost opening more banks in unbanked centres and give a measure of confidence to the banking industry in India, Reserve Bank of India has liberalised the branch opening policy. Hitherto banks had to take permission from the RBI to open banks, which were given on a case by case basis. But now in a major move, banks are given general permission to open bank branches, specialised branches, extension counters, satellite offices, service branches in Tier 1 to Tier 6 cities subject to some conditions such as 25% of all branches opened in a year should be in unbanked centres. Further the number of new branches opened in Tier 1 centres should not exceed the number of branches opened in Tier 2 to 6 cities and North East states and sikkim combined. Banks have been given two years’ leeway in opening branches in Tier 2 to 6 cities. The full circular is available at 

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Service Tax Return for April to September 2013

Service Tax Return (ST-3) for the period April -September’ 13 is now available in ACES for e-filing by the assesses in both offline and online version. The last date of filing the ST-3 return for the said period is 25th October, 2013. The assesses can file return either online or use the offline utility by downloading the latest version from or from ‘DOWNLOADS’ Section of ACES website. For details on how to e-file in ACES or any further information/assistance, assessees may read the Instructions given in the return form and the FAQs under ‘Help’ Section of the ACES website ( or contact their jurisdictional Service Tax Officer.

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South by Java Head by Alistair Maclean

Alistair Maclean is my favorite author. South by Java Head is a gripping, breathtaking book of vintage Maclean style. The plot takes time to evolve, situated as it is in the 1940s in the Pacific ocean where a desperate group of seamen are looking for a way out of Singapore out of the marauding Japanese invaders. Each of the character is invested with power and personality and the plot takes a lot of u-turns, twists and turns so typical of Maclean. The sinking of two ships and their flight across to an island away from some sinister machinations of which most were not aware of, makes this book a very engaging one. Maclean specialises in maritime stories and this one does not disappoint with its pulsating, throbbing narrative. Rating 5/5 – must read for Alistair Maclean fans. 

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SOP for suspension/ revokation of trading of shares of listed entities

SEBI has released a Press Release on September 30, 2013 wherein they have stipulated that stock exhanges will start levying fine on per day basis for non compliance or delay in compliances with the listing agreement by listed entities instead of putting the scrips on suspension which affects the non promoters more than the promoters. Other measures stipulated are freezing of promoter shares and moving of shares to “trade to trade” window. 

Copy of the Press Release is available at

and copy of the Circular is available at


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