Monthly Archives: December 2021

consumer protection commission

https://pib.gov.in/PressReleasePage.aspx?PRID=1786342

In exercise of powers conferred by provisos to sub-section (1) of Section 34, sub-clause (i) of clause (a) of sub-section (1) of section 47 and sub-clause (i) of clause (a) of sub-section (1) of section 58 read with sub-clauses (o), (x) and (zc) of sub-section (2) of section 101 of the Consumer Protection Act, 2019, the Central Government has notified the Consumer Protection (Jurisdiction of the District Commission, the State Commission and the National Commission) Rules, 2021

The Consumer Protection Act, 2019 promulgates a three-tier quasi-judicial mechanism for redressal of consumer disputes namely district commissions, state commissions and national commission. The Act also stipulates the pecuniary jurisdiction of each tier of consumer commission. As per the existing provisions of the Act, District Commissions have jurisdiction to entertain complaints where value of the goods or services paid as consideration does not exceed one crore rupees. State Commissions have jurisdiction to entertain complaints where value of the goods or services paid as consideration, exceeds 1 crore rupees, but does not exceed 10 crore rupees and National Commission has jurisdiction to entertain complaints where value of goods or services paid as consideration exceeds 10 crore rupees.

After the Act came into force, it was observed that the existing provisions relating to pecuniary jurisdiction of consumer commissions were leading to cases which could earlier be filed in National Commission to be filed in State Commissions and cases which could earlier be filed in State Commissions to be filed in District Commissions. This caused a significant increase in the workload of District Commissions, leading to rise in pendency and delay in disposal of cases, defeating the very object of securing speedy redressal to consumers as envisaged under the Act.

With regard to revision of pecuniary jurisdiction, Central Government held wide consultation with States/UTs, consumer organizations, law chairs etc. and examined the issues that had created long pendency of cases in detail.

With notification of the aforementioned rules, the new pecuniary jurisdiction, subject to other provisions of the Act, shall be as under:

  1.  District Commissions shall have jurisdiction to entertain complaints where value of the goods or services paid as consideration does not exceed 50 lakh rupees.
  2.  State Commissions shall have jurisdiction to entertain complaints where value of the goods or services paid as consideration exceeds 50 lakh rupees but does not exceed 2 crore rupees.
  3. National Commission shall have jurisdiction to entertain complaints where value of the goods or services paid as consideration exceeds 2 crore rupees.

It may be mentioned that the Consumer Protection Act, 2019 stipulates that every complaint shall be disposed of as expeditiously as possible and endeavour shall be made to decide the complaint within a period of 3 months from the date of receipt of notice by opposite party where the complaint does not require analysis or testing of commodities and within 5 months if it requires analysis or testing of commodities.

The Act also provides consumers the option of filing complaint electronically. To facilitate consumers in filing their complaint online, the Central Government has set up the E-Daakhil Portal, which provides a hassle-free, speedy and inexpensive facility to consumers around the country to conveniently approach the relevant consumer forum, dispensing the need to travel and be physically present to file their grievance. E-Daakhil has many features like e-Notice, case document download link & VC hearing link, filing written response by opposite party, filing rejoinder by complainant and alerts via SMS/Email. Presently, facility of E-Daakhil is available in 544 consumer commissions, which includes the National Commission and consumer commissions in 21 states and 3 UTs. So far, more than 10,000 cases have been filed using the E-Daakhil Portal and more than 43000 users have registered on the portal.

To provide a faster and amicable mode of settling consumer disputes, the Act also includes reference of consumer disputes to Mediation, with the consent of both parties. This will not only save time and money of the parties involved in litigating the dispute, but will also aid in reducing overall pendency of cases.

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7.49 kms

7.49 kms for the morning. Quite a warm morning today unlike two days ago, when it was quite chilly. Had worn a muffler thinking it will be quite cold, but turned out to be otherwise. Have a great morning and have an awesome New Year blast. Last run of the year, finished with 118 kms for the month and 903 kms for the year.

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KYC regn agencies

SEBI has vide its press release dated 28th December, 2021 modified slightly the role of KYC registration agencies in the securities market. Read on .

  1. The Board approved amendments to the SEBI {KYC (Know Your Client) Registration Agency} Regulations, 2011 towards enhancing the role of KYC Registration Agencies (KRAs).
  2. As per the approved amendment, KRAs have been made responsible to carry out independent validation of the KYC records uploaded onto their system by the Registered Intermediary (RI) and to maintain an audit trail of the upload / modification / download w.r.t. KYC records of client.
  3. It has also been prescribed that the systems of the RIs and KRAs should be integrated to facilitate seamless movement of KYC documents to and from RIs to KRAs.

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periodic updation of KYC

RBI has vide its circular dated 30th December, 2021 given relief from the periodic updation of KYC by regulated entities, of its existing customers until 31st March, 2022 in view of the resurgence of covid in certain parts of the country.

Otherwise banks have to do periodic KYC updation and where KYC updation could not be done for any reason, banks had powers to put restrictions on customers’ bank accounts including freezing of bank accounts.

This periodic KYC updation is probably the biggest bugbear of banking customers today. Its needless, its time consuming, with lots of documentation and gives unnecessary tension and headaches to customers. Gone are the days when KYC was rarely sought, and i remember way back in 2004 when i opened a current account, it took all of 5 minutes. Nowadays it takes anywhere from three weeks to 2 months with endless documentation and frustration and delays. Bankers think that every body is a terrorist whereas the bankers themselves are responsible for the global money laundering taking place.

Hypocrisy sucks sometimes.

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Miracle Cure

Harlan Coben races fast with this fast paced medical thriller “Miracle Cure”.

It has all the hallmarks of a potboiler with suspense at every twist and turn. Dr. Harvey Riker has found a miracle cure for AIDS which will change many lives racked with that illness. His co Dr. Bruce Grey has some suspicions and ends up with a thud from the 11th floor hotel.

Bodies start piling up one after another and all from the gay community. A senator’s son also ends up in that pile. A basketball star Michael Silverman has some abdomen pain and lands up in hospital and is soon diagnosed with AIDS. His celebrity TV news anchor Sara Lowell pitches it up with a news conference.

Max Bernstein, the NYPD cop gets involved because of the multiple murders attributed to a Gay Slasher. Things take time to unravel in the Coben plot, but when it does its a race down the line with so many twists and turns happening all the time. Good pulsating book to end the 2021 with. There were some unrealistic elements to the plot, hence Goodreads 4/5

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mutual funds amendments

SEBI has vide its press release dated 28th December, 2021 announced some amendments to the Mutual Funds Regulations. Details are given below:

  1. The Board approved amendment to MF Regulations to mandate Mutual Funds schemes to follow Indian Accounting Standard (IND AS) from Financial Year 2023-24 onwards. Further, the Board approved amendments to MF Regulations with respect to accounting related regulatory provisions to remove redundant provisions and to bring more clarity.
  2. The Board approved amendment to MF Regulations to mandate the Trustees to obtain the consent of the unitholders when the majority of the trustees decide to wind up a scheme or prematurely redeem the units of a close ended scheme. Further, the trustees shall obtain consent of the
    unitholders by simple majority of the unitholders present and voting on the basis of one vote per unit held and publish the results of voting within 45 days of the publication of notice of circumstances leading to winding up. In case the trustees fail to obtain the consent, the scheme shall open for business activities from the second business day after publication of results of voting

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amdt to AIF regulations

SEBI has vide its press release dated 28th December, 2021 announced amendment to the SEBI (Alternative Investment Fund) Regulations to bring about a new category of fund viz. Special Situations Fund as a sub category under Category I AIF. Details are as under:

  1. The Board approved amendment to AIF Regulations, to introduce Special Situation Funds, a sub-category under Category I AIF, which shall invest only in ‘stressed assets’ such as:
     Stressed loans available for acquisition in terms of Reserve Bank of India (Transfer of Loan Exposures) Directions, 2021 or as part of a resolution plan approved under Insolvency and Bankruptcy Code, 2016
     Security receipts issued by Asset Reconstruction Companies
     Securities of companies in distress.
     Any other asset/security as may be prescribed by the Board from time to time
  2. Other important features of the regulatory framework for Special Situation Funds include:
     Exemptions from investment concentration norm in a single investee company
     No restriction on investing their investible funds in unlisted or listed securities of the investee company
     Minimum investment by an investor to be INR 10 crore and INR 5 crore in case of an accredited investor
     Minimum corpus of INR 100 crore
     Initial and continuous due diligence requirements mandated by RBI for ARCs’ investors shall also be applicable to SSFs while acquiring stressed loans in terms of Reserve Bank of India (Transfer of Loan Exposures) Directions, 2021

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appt of directors

SEBI has vide its press release dated 28th December, 2021 specified that directors, including managing directors or whole time directors or managers who fail to get elected as such at a general meeting of a listed entity, shall thereafter be appointed as directors, managing directors, whole time directors, managers, respectively only with the prior approval of the shareholders.

Suitable amendments for the same will be brought in the LODR by SEBI later.

The operative part of the press release reads as under:

  1. The Board approved a proposal to introduce provisions in the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“LODR Regulations” / “LODR”) relating to appointment or re-appointment of persons who fail to get elected as directors, including as Whole-time directors or Managing Directors or Managers, at the general meeting of a listed entity.
  2. Accordingly, appointment or a re-appointment of any person, including as a managing director or a whole-time director or a manager, who was earlier rejected by the shareholders at a general meeting, shall be done only with the prior approval of the shareholders.

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IPO related amendments

SEBI has vide its press release dated 28th December, 2021 specified certain IPO related amendments as per details given below.

The Board approved the proposal to amend various aspects of regulatory framework under the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 (ICDR Regulations) and consequential amendment to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as applicable, based on the public consultation process on the proposals recommended by Primary Market Advisory Committee (PMAC). Some of the key amendments are as follows:

  1. Following shall be applicable for Draft Red Herring Prospectus (DRHP) filed on or after notification in the Official Gazette:
    a. Conditions for Objects of the Issue:
    i. Where the issuer company in its offer documents, set out an object for future inorganic growth but has not identified any acquisition or investment target, the amount for such objects and amount for
    general corporate purpose (GCP) shall not exceed 35% of the total amount being raised.
    ii. The amount so earmarked for such objects where the issuer company has not identified acquisition or investment target, as mentioned in objects of the issue in the draft offer document and the offer document, shall not exceed 25% of the amount being raised by the issuer.
    iii. Above limits shall not apply if the proposed acquisition or strategic investment object has been identified and suitable specific disclosures about such acquisitions or investments are made in
    the draft offer document and the offer document at the time of filing of offer documents.
    b. Conditions for offer for Sale (OFS) to public in an IPO where DRHP is filed by issuer without track record i.e. under Regulation 6(2) of ICDR Regulations, 2018:
    i. Shares offered for sale by selling shareholders, individually or with persons acting in concert, holding more than 20% of pre-issue shareholding of the issuer, shall not exceed more than 50% of their pre-issue shareholding.
    ii. Shares offered for sale by selling shareholders, individually or with persons acting in concert, holding less than 20% of pre-issue shareholding of the issuer, shall not exceed more than 10% of pre-issue shareholding of the issuer.
    c. Monitoring Agency and reporting on utilization of issue proceeds:
    i. Credit Rating Agency (CRAs) registered with the Board, shall henceforth be permitted to act as Monitoring Agency instead of Scheduled Commercial Banks (SCBs) and Public Financial
    Institutions (PFI).
    ii. Such a monitoring shall continue till 100% instead of 95% utilization of issue proceeds as present.
    iii. Amount raised for GCP shall also be brought under monitoring and utilization of same shall be disclosed in monitoring agency report.
    iv. Monitoring agency report shall be placed before audit committee for consideration “on a quarterly basis” instead of “on an annual basis”.
  2. Price Band: In case of book built issues, a minimum price band of be at least 105% of the floor price shall be applicable for all issues opening on or after notification in the official gazette.
  3. Lock-in for Anchor Investors: The existing lock in of 30 days shall continue for 50% of the portion allocated to anchor investor and for the remaining portion, lock in of 90 days from the date of allotment shall be applicable for all issues opening on or after April 01, 2022.
  4. Revised allocation methodology for Non Institutional Investors (NIIs):
    a. For book built issues opening on or after April 01, 2022, the allocation in the NII category shall be revised as follows:
    i. one third of the portion available to NIIs shall be reserved for applicants with application size of more than two lakh rupees and up to ten lakh rupees;
    ii. two third of the portion available to NIIs shall be reserved for applicants with application size of more than ten lakh rupees:
    b. Allotment of securities in case of NII category shall be on ‘draw of lots’, as is currently applicable for retail individual investors (RIIs) category (i.e. draw of lots to allot minimum application size to applicants, in case of oversubscription and balance allotment on proportionate basis).
  5. Following shall be applicable for all preferential issues where relevant date is after the notification in the official gazette:
    a. Determining the floor price: Following factors shall be considered for determining the floor price for all preferential issues:
    i. For frequently traded security, the floor price for preferential issue shall be higher of 90/10 trading days’ volume weighted average price (VWAP) of the scrip preceding the relevant date or as per any stricter provision in the Article of Association of the issuer company.
    ii. For infrequently traded security, the valuation report by a registered independent valuer shall be required.
    b. An additional requirement for a valuation report from a registered independent valuer shall be required in case of change in control/allotment of more than 5% of post issue fully diluted share capital of the issuer company to an allottee or to allottees acting in concert. The same shall be considered for determination of floor price in addition to the methodology brought out at (a) above.
    c. Further, in case of change in control, a committee of independent directors shall be required to provide a reasoned recommendation along with their comments on all aspects of preferential issuance including pricing. The voting pattern of the committee shall also be disclosed to shareholders/public.
    d. Lock-in Provisions for preferential issue: In line with lock-in requirements for public issues, the tenure of lock-in of shares pursuant to a preferential issue shall be reduced as follows:
    i. For Promoters:
    The lock-in requirement for allotment upto 20% of the post issue paid up capital shall be reduced to 18 months from the existing 3 years. The lock-in requirement for allotment exceeding 20% of the
    post issue paid up capital shall be reduced to 6 months from the existing 1 year.
    ii. For Non-promoters
    The lock-in requirement for allotments shall be reduced from requirement of 1 year to 6 months.
    e. Pledge of locked-in shares:
    Promoters would be permitted to pledge the shares locked-in pursuant to a preferential issue provided if pledge of such specified securities is one of the terms of sanction of the loan granted by certain financial institutions and the said loan is to be sanctioned to the issuer company or its subsidiary(ies) for the purpose of financing one or more of the objects of the preferential issue.
    f. Preferential Issue for consideration other than cash:
    Consideration for preferential issue, “other than cash” shall be permitted only for share swaps backed by a valuation report from an independent registered valuer.
    g. Timelines for seeking in-principle approval from stock exchanges by issuer company:
    Issuer company shall necessarily apply for in-principle approval from stock exchanges on the same day as the date of dispatch of notice for AGM/ EGM to shareholders.

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REIT/ InvIT holder meetings

https://www.sebi.gov.in/legal/circulars/dec-2021/extension-of-facility-for-conducting-annual-meeting-and-other-meetings-of-unitholders-of-reits-and-invits-through-video-conferencing-vc-or-through-other-audio-visual-means-oavm-_54861.html

SEBI has vide its circular dated 22nd December 2021 allowed the annual meetings of the unit holders of Real Estate Investment Trusts and Infrastructure Investment Trusts by virtual mode i.e. by video conferencing or any other audio visual means upto 30th June, 2022 in line with a similar relaxation given by the Ministry of Corporate Affairs for the shareholders’ meetings.

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direct selling

https://pib.gov.in/PressReleasePage.aspx?PRID=1785873

Central Government in exercise of the powers conferred by clause (zg) of sub-section (2) of section 101 read with section 94 of the Consumer Protection Act, 2019 has notified  the Consumer Protection (Direct Selling) Rules, 2021.

These Rules shall apply to all goods and services bought or sold through direct selling, all models of direct selling, all direct selling entities offering goods and services to consumers in India, all forms of unfair trade practices across all models of direct selling and also to also to a direct selling entity which is not established in India, but offers goods or services to consumers in India.

Existing direct selling entities need to comply of these rules within ninety days from the date of publication of these rules in the Official Gazette.

The direct sellers as well as the direct selling entities using e-commerce platforms for sale shall comply with the requirements of the Consumer Protection (e-Commerce) Rules, 2020.

Direct selling entity and direct sellers are prohibited from:

(i)         Promoting a Pyramid Scheme or enroll any person to such scheme or participate in such arrangement in any manner whatsoever in the garb of doing direct selling business;

(ii)        Participate in money circulation scheme in the garb of doing direct selling business.

Rules provide for Monitoring by State Government.–– For ensuring compliance of these rules by direct selling entity and direct sellers, every State Government to set up a mechanism to monitor or supervise the activities of direct sellers and direct selling entity.

The Rules provide for certain obligation upon Direct Selling Entities which inter alia include :-

(i)         incorporation under the Companies Act, 2013 or if a partnership firm, be registered under the Partnership Act, 1932, or if a limited liability partnership, be registered under the Limited Liability Partnership Act, 2008;

(ii)        have a minimum of one physical location as its registered office within India

(iii)       make self-declaration to the effect that Direct Selling Entity has complied with the provisions of the Direct Selling  rules and is not involved in any Pyramid Scheme or money circulation scheme;

(iv)       have a prior written contract with its direct sellers in order to authorize them to sell or offer to sell its goods or services, and the terms of such agreement shall be just, fair and equitable;

(v)        ensure that all its direct sellers have verified identities and physical addresses and issue identity cards and documents only to such direct sellers;

(vi)       create adequate safeguards to ensure that goods and services offered by its direct sellers conform to applicable laws;

(vii)      be liable for the grievances arising out of the sale of goods or services by its direct sellers.

(viii)     every direct selling entity to provide the following information on its website in a clear and accessible manner

         registered name of the direct selling entity;

         registered address of the direct selling entity and of its branches;

         contact details, including e-mail address, fax, land line and mobile numbers of its customer care and grievance redressal officers;

         a ticket number for each complaint lodged through which the complainant can track the status of the complaint;

         information relating to return, refund, exchange, warranty and guarantee, delivery and shipment, modes of payment, grievance redressal mechanism and such other information which may be required by the consumers to make informed decisions;

         information on available payment methods, the security of those payment methods, the fees or charges payable by users, the procedure to cancel regular payments under those methods, charge-back options, if any, and the contact information of the relevant payment service provider;

         total price of any goods or service in single figure, along with its break-up price showing all compulsory and voluntary charges, including delivery charges, postage and handling charges, conveyance charges and the applicable tax;

         provide correct and complete information at pre-purchase stage to enable buyers to make informed purchase decisions,  No direct selling entity shall adopt any unfair trade practice in the course of its business or otherwise, and shall abide by the requirements specified in any law for the time being in force.

All products of a direct selling entity to comply with the declarations to be made under the Legal Metrology Act, 2009.

Every direct selling entity to establish an adequate grievance redressal mechanism and display the current and updated name, contact details including telephone number, email address and designation of such officer on its website, and the details of its website shall also be prominently printed on the product information sheet or pamphlet.

Grievance redressal officer to acknowledge the receipt of any consumer complaint within forty-eight working hours of receipt of such complaint and redresses the complaint normally within a period of one month from the date of receipt of the complaint and in case of delay of more than a month, reasons for the delay, and the actions taken on the complaint, are informed to the complainant in writing.

Every direct selling entity shall appoint a nodal officer who shall be responsible for ensuring compliance with the provisions of the Act and the rules made there under, and to ensure compliance with any order, or requisition, made in accordance with the provisions of any other law for the time being in force or the rules made thereunder.

Every direct selling entity shall establish a mechanism for filing of complaints by consumers through its offices or branches or direct sellers, either in person or through post, telephone, e-mail or website.

Every direct selling entity shall maintain a record of all its direct sellers, including their identity proof, address proof, e-mail and such other contact information.

Every direct selling entity shall, on the request in writing made by a consumer after the purchase of any goods or services, provide him with the information regarding any direct seller from whom such consumer has made a purchase, and such information shall include the name, address, e-mail, contact number and any other information which is necessary for making communication with such direct seller for effective dispute resolution.

Every direct selling entity shall ensure that the advertisements for marketing of goods or services are consistent with the actual characteristics, access and usage conditions of such goods or services.

 No direct selling entity shall, directly or indirectly, falsely represent itself as a consumer and post reviews about its goods or services or misrepresent the quality or features of any of its goods or services.

A direct selling entity which explicitly or implicitly vouches for the authenticity of the goods or services sold, or guarantees that such goods or services are authentic, shall bear the liability in any action related to the authenticity of such goods or services.

Notwithstanding the distribution system adopted by it, a direct selling entity shall monitor the practices adopted by its direct sellers and ensure compliance with these rules by means of legally binding contract with such direct sellers.

Every direct selling entity shall maintain a record of relevant information allowing for the identification of all direct sellers who have been delisted by the direct selling entity and such list shall be publicly shared on its website.

Every direct selling entity shall become a partner in the convergence process of the National Consumer Helpline of the Central Government.

The Rules provide for certain obligation upon Direct Sellers  which inter alia include :-

(i)         have a prior written contract with the direct selling entity for undertaking sale of, or offer to sell, any goods or services of such entity;

(ii)        at the initiation of any sale representation, truthfully and clearly identify himself, disclose the identity of the direct selling entity, the address of place of business, the nature of goods or services sold and the purpose of such solicitation to the prospect;

(iii)       make an offer to the prospect providing accurate and complete information, demonstration of goods and services, prices, credit terms, terms of payment, return, exchange, refund policy, return policy, terms of guarantee and after-sale service;

(iv)       provide an order form to the consumer at or prior to the time of the initial sale, which shall identify the direct selling entity and the direct seller and shall contain the name, address, registration number or enrollment number, identity proof and contact number of the direct seller, complete description of the goods or services to be supplied, the country of origin of the goods, the order date, the total amount to be paid by the consumer, the time and place for inspection of the sample and delivery of goods, consumer’s rights to cancel the order or to return the product in saleable condition and avail full refund on sums paid and complete details regarding the complaint redressal mechanism of the direct selling entity;

(v)        obtain goods and service tax registration, Permanent Account Number registration, all applicable trade registrations and licenses and comply with the requirements of applicable laws, rules and regulations for sale of a product;

(vi)       ensure that actual product delivered to the buyer matches with the description of the product given;

(vii)      take appropriate steps to ensure the protection of all sensitive personal information provided by the consumer in accordance with the applicable laws for the time being in force and ensure adequate safeguards to prevent access to, or misuse of, data by unauthorized persons.

(viii)     A direct seller shall not––

         visit a consumer’s premises without identity card and prior appointment or approval;

         provide any literature to a prospect, which has not been approved by the direct selling entity;

         require a prospect to purchase any literature or sales demonstration equipment;

         in pursuance of a sale, make any claim that is not consistent with claims authorized by the direct selling entity.

Every direct selling entity and every direct seller shall ensure that––

(i)         the terms of the offer are clear, so as to enable the consumer to know the exact nature of offer being made and the commitment involved in placing any order;.

(ii)        the presentations and other representations used in direct selling shall not contain any product description, claim, illustration or other element which, directly or by implication, is likely to mislead the consumer;.

(iii)       the explanation and demonstration of the goods or services offered are accurate and complete, particularly with regard to price and, if applicable, to credit conditions, terms of payment, cooling-off periods or right to return, terms of guarantee, after-sales service and delivery;

(iv)       the descriptions, claims, illustrations or other elements relating to verifiable facts are capable of substantiation

(v)        any misleading, deceptive or unfair trade practices are not used;

(vi)       direct selling is not represented to the consumer as being a form of market research;

(vii)      direct selling shall not state or imply that a guarantee, warranty or other expression having substantially the same meaning, offers to the consumer any rights in additional to those provided by law, when it does not;

(viii)     the remedial action open to the consumer shall be clearly set out in the order form or other accompanying literature provided with the goods or service

(ix)       the presentation of the offer does not contain or refer to any testimonial, endorsement or supportive documentation unless it is genuine, verifiable and relevant;

(x)        when after-sales service is offered, details of the service are included in the guarantee or stated elsewhere in the offer and if the consumer accepts the offer, information shall be given on how the consumer can activate the service and communicate with the service agent;

(xi)       unless otherwise stipulated in the offer, orders shall be fulfilled within the delivery date proposed to the consumer at the time of purchase and the consumer shall be informed of any undue delay as soon as it becomes apparent or comes within the knowledge of the direct selling entity or the concerned direct seller;

(xii)      in cases of delay  any request for cancellation of the order by the consumer shall be granted, irrespective of whether the consumer has been informed of the delay, and the deposit, if any, shall be refunded as per the cancellation terms proposed to the consumer at the time of purchase, and if it is not possible to prevent delivery, the consumer shall be informed of the right to return the product at the direct selling company’s or the direct seller’s cost as per the procedure for return of the goods proposed to the consumer at the time of purchase;

(xiii)       whether payment for the offer is on an immediate sale or installment basis, the price and terms of payment shall be clearly stated in the offer together with the nature of any additional charges such as postage, handling and taxes and, whenever possible, the amounts of such charges;

(xiv)     in the case of sales by installment, the credit terms, including the amount of any deposit or payment on account, the number, amount and periodicity of such installments and the total price compared with the immediate selling price, if any, shall be clearly shown in the offer;

(xv)      any information needed by the consumer to understand the cost, interest and terms of any other form of credit is provided either in the offer or when the credit is offered;

(xvi)     unless the duration of the offer and the price are clearly stated in the offer, prices shall be maintained for a reasonable period of time;

(xvii)      A direct selling entity or direct seller shall not––

         indulge in fraudulent activities or sales and shall take reasonable steps to ensure that participants do not indulge in false or misleading representations or any other form of fraud, coercion, harassment, or unconscionable or unlawful means;

         engage in, or cause or permit, any conduct that is misleading or likely to mislead with regard to any material particulars relating to its direct selling business, or to the goods or services being sold by itself or by the direct seller;

         indulge in mis-selling of products or services to consumers;

         use, or cause or permit to be used, any fraudulent, coercive, unconscionable or unlawful means, or cause harassment, for promoting its direct selling business, or for sale of its goods or services;

         refuse to take back spurious goods or deficient services and refund the consideration paid for goods and services provided;

         charge any entry fee or subscription fee.

(xviii)   direct selling entity and a direct seller shall not induce consumers to make a purchase based upon the representation that they can reduce or recover the price by referring prospective customers to the direct sellers for similar purchases.

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7.39 kms

7.39 kms for the morning. Happy Independence day to Mongolian runners and Happy Constitution Day to Irish runners.

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electronic gold receipt

Ministry of Finance has vide its notification dated 24th December, 2021 declared “Electronic Gold Receipt” as securities under the Securities Contract Regulation Act, 1956.

This move will ensure that EGR will be traded as a separate category in the bourses and will have trading, clearing & settlement features just like any other security in the stock market. The EGR holder will have a right to withdraw the underlying gold whenever he wants it. This is expected to create a vibrant gold eco system in the country.

Additional information sourced from

https://www.thehindubusinessline.com/markets/gold/electronic-gold-receipts-are-now-securities-says-finance-ministry/article38043968.ece

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investment advisory for accredited investors

https://www.sebi.gov.in/legal/circulars/dec-2021/investment-advisory-services-for-accredited-investors_54830.html

SEBI has vide its circular dated 21st December, 2021 clarified that exit load applicable to the client of Investment Advisory Services shall, in the case of accredited investor, be governed through bilaterally negotiated contractual terms and the SEBI regulations will not apply in such cases.

What is “accredited investor”. It means, as per clause 2(1)(ab) of SEBI (Alternative Investment Funds) Regulations, 2012 any person who is granted accreditation by an accreditation agency and who

(i) in case he is individual, HUF, family trust, or sole proprietorship, has (a) annual income of at least Rs.20 million OR (b) net worth of at least Rs.75 million out of which not less than Rs.37.5 million is in the form of financial assets OR (C) has annual income of at least Rs. 10 million and minimum net worth of not less than Rs.50 million of which not less than Rs.25 million is in the form of financial assets

(ii) in case of body corporate, has net worth of at least Rs.500 million;

(iii) in case of trust other than family trust, has net worth of at least Rs.500 million;

(iv) in case of general partnership, then each partner independently meets the eligibility criteria for accreditation.

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PMS for accredited investors

https://www.sebi.gov.in/legal/circulars/dec-2021/portfolio-management-services-for-accredited-investors_54828.html

SEBI has vide its circular dated 21st December, 2021 clarified that exit load applicable to the client of Portfolio Management Services shall, in the case of accredited investor, be governed through bilaterally negotiated contractual terms and the SEBI regulations will not apply in such cases.

What is “accredited investor”. It means, as per clause 2(1)(ab) of SEBI (Alternative Investment Funds) Regulations, 2012 any person who is granted accreditation by an accreditation agency and who

(i) in case he is individual, HUF, family trust, or sole proprietorship, has (a) annual income of at least Rs.20 million OR (b) net worth of at least Rs.75 million out of which not less than Rs.37.5 million is in the form of financial assets OR (C) has annual income of at least Rs. 10 million and minimum net worth of not less than Rs.50 million of which not less than Rs.25 million is in the form of financial assets

(ii) in case of body corporate, has net worth of at least Rs.500 million;

(iii) in case of trust other than family trust, has net worth of at least Rs.500 million;

(iv) in case of general partnership, then each partner independently meets the eligibility criteria for accreditation.

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