Louis L’Amour is my favorite author and this one does not disappoint. Brilliant story of a US air force pilot and a red Indian shot down and captured by Russians for information. Major Joe Mack is a Red Indian, a Sioux and knowing all the survival skills of his forefathers. He escapes prison by pole vaulting above the prison walls and then, in freezing temperatures, sprints across the cold, frozen Russian land and has to use all the skills of his ancestors to survive and be on the run for days, months and years. He meets a family of hunters and trappers, stays with them for a while, hunting meat for them and falling silently in love with the daughter Natalya. He is faced with with the guile of an Yakut, a Russian who has similar intelligence as him to trace him out of his hidings, Alekhin. He fears only Alekhin and has to constantly place secret snares and traps for his followers to fall to death. The deadly game of cat and mouse goes on for a couple of seasons with the KGB after his blood. Brilliant narrative as usual from Louis L’Amour – a pulsating, throbbing novel bought to life by the master. Goodreads 5/5
Monthly Archives: February 2021
MCA has vide its notification dated 11th February, 2021 notified section 52 of the Companies (Amendment) Act, 2020.
Section 52 of the Companies Amendment Act, 2020, brings to life a new Chapter XXIA which pertains to producer companies. Earlier these provisions were regulated under the old Companies Act, 1956, but now they have been brought into the Companies Act, 2013 proper.
Sections 378A to 378ZU governs the incorporation & administration of producer companies in India, which are a form of farmer co-operatives in the agriculture sector. They are formed by farmers/ producers of agricultural crops and there are strict guidelines regarding their formation, administration, governance, etc.
MCA has vide its notification amended the Companies (Specification of Definition Details), Rules, 2014 by introducing a new rule 2A which defines the companies which need not be considered as listed companies. The rule says
“2A. Companies not to be considered as listed companies.- For the purposes of the proviso to clause (52) of section 2 of the Act, the following classes of companies shall not be considered as listed companies, namely:-
(a) Public companies which have not listed their equity shares on a recognized stock exchange but have listed their –
(i) non-convertible debt securities issued on private placement basis in terms of SEBI (Issue and Listing of Debt Securities) Regulations, 2008; or
(ii) non-convertible redeemable preference shares issued on private placement basis in terms of SEBI (Issue and Listing of Non-Convertible Redeemable Preference Shares) Regulations, 2013; or
(iii) both categories of (i) and (ii) above.
(b) Private companies which have listed their non-convertible debt securities on private placement basis on a recognized stock exchange in terms of SEBI (Issue and Listing of Debt Securities) Regulations, 2008;
(c) Public companies which have not listed their equity shares on a recognized stock exchange but whose equity shares are listed on a stock exchange in a jurisdiction as specified in sub-section (3) of section 23 of the Act.”.
Section 23(3) of the Act pertains to listing in foreign jurisdictions. So basically all the public companies who have listed only their debt securities without listing their equity securities will not be considered as listed entities. Similarly private companies which listed only their debt securities also will be considered as listed entities anymore.
That takes from these entities, the onerous responsibility of complying with the listing regulations stipulated by SEBI.
Government calls it as an ease of doing business, but ideally, this should have been thought about early on itself i.e. such companies should not have been considered as listed entities ab initio itself.
RBI has vide its order dated 25th February, 2021 levied a monetary penalty of Rs.20 million on a nationalised bank i.e. Bank of Maharashtra. That penalty is due to massive non compliances relating to contravention of / non-compliance with certain provisions of the directions contained in Reserve Bank of India (Frauds classification and reporting by commercial banks and select FIs) directions 2016 and the circulars on Concurrent Audit System in Commercial Banks – Revision of RBI’s Guidelines, Disclosure of customer complaints and unreconciled balances on account of ATM transactions, and Micro, Small and Medium Enterprises (MSME) Sector – Restructuring of Advances.
This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers.
The statutory inspection of the bank with reference to its financial position as on March 31, 2018 and March 31, 2019 and the Risk Assessment Reports (RARs) pertaining thereto revealed, inter alia, non-compliance with the aforesaid directions issued by RBI. In furtherance to the same, notices were issued to the bank advising it to show cause as to why penalty should not be imposed for failure to comply with the directions issued by RBI. After considering the bank’s replies to the notices, oral submissions made in the personal hearing and examination of additional submissions made by it, RBI came to the conclusion that the aforesaid charges of non-compliance with RBI directions were substantiated and warranted imposition of monetary penalty.
Employees state insurance corporation press release dated 23rd February, 2021. Salient features.
- Relaxation in contributory conditions to avail Sickness Benefit to the Insured Women availing Maternity Benefit
After the enhancement in duration of maternity benefit from earlier 12 weeks to 26 weeks, in some cases Insured Women were not eligible to avail sickness benefit in the corresponding benefit period after availing maternity benefit as the mandatory contributory conditions of minimum 78 days were not met being the Insured Women under receipt of maternity benefit and leave.
In such cases, it has been now decided that an Insured Women will be qualified to claim sickness benefit in the corresponding benefit period if the contribution in her respect were paid or payable for not less than half the number of days available for working in such shorter contribution period.
The relaxation will be effective from 20.01.2017 i.e. the date from which the enhanced duration of Maternity Benefit is effective.
- Relaxation in contributory conditions to avail Sickness & Maternity Benefits for the benefit period of January to June’2021
The country was placed into lockdown to curb the spread of Covid-19 pandemic, which resulted in the closure of factories/establishments for several months. It resulted in non-entitlement to avail sickness & maternity benefits for many Insured Persons/Women as the mandatory days of contribution couldn’t be met. Considering the hardship being faced by Insured Persons, ESIC has now decided to extend the relief to the IPs by relaxing the contributory conditions for availing the Sickness & Maternity Benefits for the benefit period of 01.01.2021 to 30.06.2021.
Now, an Insured Woman will be entitled to avail Maternity Benefit, if the contributions in respect of her were payable not less than 35 days in immediately preceding two consecutive contribution periods.
In case of IPs/IWs appointed before the contribution period April-September, 2020 , the eligibility condition to avail sickness benefit will be decided on the basis of their contribution in previous contribution period i.e. September ’19 to March ‘2020,whereas, the IPs/IWs appointed during the contribution period April-September, 2020 will be eligible for sickness benefit in the benefit period January-June ‘2021 if contribution in respect of them were payable for not less than half the number of days available for working to them during the contribution period April-September ‘2020.
RBI has vide its circular dated 16th February, 2021 allowed resident individuals to invest in securities issued in the International Financial Services Centre (IFSC) through the Liberalised Remittance Scheme route. There are some conditions to be fulfilled, which are :
- The remittance shall be made only for making investments in IFSCs in securities, other than those issued by entities/companies resident (outside IFSC) in India.
- Resident Individuals may also open a non interest bearing Foreign Currency Account (FCA) in IFSCs, for making the above permissible investments under LRS. Any funds lying idle in the account for a period upto 15 days from the date of its receipt into the account shall be immediately repatriated to domestic INR account of the investor in India.
- Resident Individuals shall not settle any domestic transactions with other residents through these FCAs held in IFSC.
Further there are some compliances to be done by the authorised dealers in such transactions which are :
AD Category – I banks, while allowing such remittances, shall ensure compliance with all other terms and conditions, including reporting requirements prescribed under the Scheme. It may be noted that any person resident in India (outside IFSC) entering into any transaction with a person/entity in IFSC shall only be governed by regulations/directions and rules issued/notified by the Reserve Bank of India and the Government of India respectively under Foreign Exchange Management Act (FEMA), 1999. Further, compounding of any contravention of FEMA provision by such person resident in India shall be dealt by the Reserve Bank of India in accordance with the extant instructions/provisions on compounding of contraventions under FEMA.
Copy of the circular can be found here
Brilliant book by Frederick Forsyth “Dogs of War” set in the murky world of mercenaries being used to topple governments where mineral stakes are high, very high.
Zangaro, a fictional African country is in the middle of it, some platinum reserves having been discovered there, with a corrupt president at the helm, ethnic clashes, broken down army, no economy to speak of. In comes Sir James Mansion a wealthy mining businessman smelling riches aplenty and his two handpicked assistants, Endean and Thorpe to do the dirty job for him. Endean tasked with finding mercenaries who will carry arms to the country, do an ambush and kill the president and ransack the place to tithers.
Forsyth does a detailed narrative of the reconnaissance part of the operation from recruiting friends to the mission, to procuring the necessary arms, equipment, boats, arranging everything legally, well almost all of them. Most of the narrative is dwelt on the preparation part of the operation.
And when you expect the operation will run to plan, Forsyth springs a surprise at the end. Cat Shannon, the English mercenary is in the thick of the things, does a meticulous job of planning the operation down to the last hour, minute with precision. This one is cult classic for the ages.
MCA has issued a notification dated 11th February, 2021 wherein they have amended the Companies (Share Capital and Debenture) rules, 2014 by adding a new clause 12A after clause 12.
Basically what the new clause 12A says is that it stipulates that the rights issue offer has to be made for acceptance by the shareholders within 7 days from the date of offer.
Earlier this stipulation was never there in the act or rules. The exact wording of the rule 12A is as follows
12A. Period for notice under sub-clause (i) of clause (a) of sub-section (1) of section 62.- For the purposes of sub-clause (i) of clause (a) of sub-section (1) of section 62, the time period within which the offer shall be made for acceptance shall be not less than seven days from the date of offer.”.
Copy of this notification can be found at the MCA site .i.e. http://www.mca.gov.in
IRDAI circular dated 9th February, 2021 on the subject, which is self explanatory
All Insurers excluding GIC Re, FRBs and Lloyd’s (India)
Re: Issuance of digital insurance policies by insurance companies via Digilocker
Digilocker is an initiative under the Digital India program by the Government of India where citizens can get authentic documents/ certificate in digital format from original issuers of these certificates. It aims at eliminating or minimising the use of physical documents and will enhance effectiveness of service delivery, making these hassle free and friendly for the citizens.
2. In the insurance sector, Digilocker will drivereduction in costs, elimination of customer complaints relating to non-delivery of policy copy, improved turnaround time of insurance services, faster claims processing and settlement, reduction in disputes, reduction in fraud and improvement in customer contactability. On the whole it is expected that it will lead to better customer experience.
3. In order to promote the adoption of Digilocker in the insurance sector, the Authority advises all insurers to enable their IT systems to interact with Digilocker facility to enable policyholders to use digilocker for preserving all their policy documents.
4. The insurers should inform their retail policyholders about Digilocker and how to use it. Insurers are also advised to enable the process by which the policyholders can place their policies in the digilocker.
5. Digilocker team in NeGD (National e-Governance Division) under Ministry of Electronics and Information Technology shall provide necessary technical guidance and logistic support to facilitate adoption of Digilocker. A brief for on-boarding documents and contact details of resource persons in NeGD is annexed.
MCA has vide its amendment to the Companies (Compromises, Arrangements & Amalgamations) Rules, 2016 provided for easy merger/ amalgamation between two or more start-up companies or one or more start up company with one or more small company.
This comes under section 233 of the companies act, 2013 which provides for an easy procedure for merger/ amalgamation of small companies without going through the cumbersome process of court/ tribunal etc. The process under clause 25 of the above regulations is by no means easy as it still involves considerable paper work, documentation and procedures but compared to the court/ tribunals, it is relatively easier.
So MCA has introduced a new sub clause 1A under clause 25 of the aforesaid Rules to provide for the said easy merger/ amalgamation.
So this is one more avenue for the company secretaries – to guide small companies/ start-up companies in the merger/ amalgamation under section 233 of the companies act, 2013 and the aforesaid regulations.
MCA has vide its notification dated 1st February, 2021 changed the definition of small company in the Companies Act, 2013.
Now small company will be a company which has a paid up share capital and turnover of not more than Rs.20 million and Rs.200 million respectively. Hitherto the limits were Rs.5 million and and Rs.2 million respectively.
Note that both the conditions should be satisfied for a company to be a small company ie.. the paid up share capital should not cross Rs.20 million AND the turnover should not cross Rs.200 million. If a company’s paid up share capital is more than Rs.20 million but the turnover is less than Rs.200 million, then it will still remain a small company.
There are a few benefits of a company being a small company under the companies act, 2013 such as
- No need to prepare Cash flow statement as part of financial statement.
- Where other companies require providing details of remuneration to directors and key managerial personnel, small companies are required to provide details of the only aggregate amount of remuneration drawn by directors in its Annual Return.
- Mandatory rotation of auditor not required.
- An Auditor of small companies is not required to report on the adequacy of the internal financial controls and its operating effectiveness in the auditor’s report.
- Hold only two board meetings in a year.
- Annual Return of the company can be signed by the Company Secretary, or where there is no company secretary, by a single director of the company.
- Lesser penalties for Small Companies.
- Lesser filing fees for Small Companies.
The lesser filing fees for small companies has not been operationalised yet, but it is expected that MCA will bring that soon.