Shares Buyback cannot be equated with capital reduction

  CA Suraj R. Agrawal Brief of the Case:- It is open to a company to buy back its own shares by following the procedure prescribed under section 77A/Section 68 or by following the procedure prescribed under section 391 read with Sections 100 to 104 of the 1956, Act. Facts of the case: The assessee is a wholly owned subsidiary of Goldman Sachs (Mauritius) LLC (GS-M). It was set up to undertake merchant banking and security business in India. Registered under the STPI scheme, the it had set up a 100% export oriented unit in Bangalore to serve as a global support centre for the Goldman Sachs Group entities. On 24.11.2010, the assessee had remitted an amount Rs. 1,88,99,97,781/- to GS-M under a buyback of shares scheme, whereby 4,03,93,199/- equity

Read More Shares Buyback cannot be equated with capital reduction

Service export prior to Export of service rules, 2005 are eligible for export rebate

  CA Urvashi Porwal Brief of the Case In the case of J.P. Morgan Services India Private Ltd. Vs. Commissioner of Central Excise(Service Tax), Mumbai, it was held that the benefit of export rebate cannot be denied even if the services are exported prior to the date when Export of Service Rules, 2005 are brought into the statute. Facts of the Case The relevant facts that arise for consideration are appellant had filed a refund claim on 12.01.2006 under rule 5 of the Export of Service Rules, 2005 (herein after preferred to as rules) being tax paid on input services utilized for export services during the period September, 2004 to June 2005. The adjudicating authority after issuing the show cause notice, and after following due process of law, rejected the

Read More Service export prior to Export of service rules, 2005 are eligible for export rebate

Abbreviations used in Customs, Central Excise and Service Tax

  A AAI : Airport Authority of India AAR : Authority for Advance Ruling AC/DC : Assistant Commissioner/Deputy Commissioner ACAO : Assistant Chief Account Officer ACES : Automation of Central Excise and Service Tax ACES-CFC : ACES Certified Facilitation Center ACP : Accredited Client Programme ACC : Air Cargo Complex AD /DD : Assistant Director/Deputy Director ADC : Additional Commissioner ADC : Assistant Drug Controller ADD : Anti-dumping duty ADG : Additional Director General AEO : Authorised Economic Operator AIIS : Agri-Infrastructure Incentive Scrip AIR : All Industry Rate AIU : Air Intelligence Unit AL : Advance License AML : Anti Money Laundering( measures) AO : Adjudication Order/ Administrative Officer AP : Audit Para ARTS : Automated Recordation and Targeting System ASIDE : Assistance to States for Developing Export Infrastructure

Read More Abbreviations used in Customs, Central Excise and Service Tax

Real Estate Investment Trust (REIT) – An overview

Meeti shah The Finance Act (No.2), 2014 and the recent, Finance Act, 2015 clearly spelled out tax treatment of all possible streams of income for all parties associated with a REIT which paved the way towards introducing an internationally acclaimed investment structure in India. More than 30 countries around the world have established REIT regimes, with more countries in the work. Let us understand the REIT regime in its true sense. What is REIT? Simply stated, REIT is similar to a mutual fund that invests in real estate properties which yield rent. It allows both small and large investors to acquire certain part of a property. REIT is a trust which pools in capital from many investors and invests the capital in income producing real estate. Parties associated with REIT: Trustee: A

Read More Real Estate Investment Trust (REIT) – An overview

Special Valuation Branch Under Customs Law

You are aware that the ‘Special Valuation Branch (hereinafter referred to as “SVB”) was created as institution specialising in investing transactions involving relationship between foreign supplier and importer or those involving other special circumstances surrounding the sale of imported goods, both of which a bearing on the assessable value. In this regard, detailed instructions were issued vide Circular No. 01/98-Customs dated January 01, 1998 and 11/2001- Customs dated February 23, 2001, prescribing the procedures to be observed by the Customs Houses for referring cases to SVBs and the time lines to be followed for finalising such cases. However, there is a tremendous delay in finalization of SVB investigations by the Departmental officials, resulting continued uncertainty due to provisional assessments, increase in transactions costs due to extra deposits and burdensome procedure

Read More Special Valuation Branch Under Customs Law

Suggestions on Draft Companies (Auditor’s Report) Order, 2016

CA Vivek Rajan. V 1. Background : The Ministry of Corporate Affairs [ MCA] vide its notice dated 9thFebruary 2016 had invited suggestions/ comments along with justification in brief on thedraft Companies ( Auditor’s Report) Order, 2016, (CARO, 2016). This article contains the suggestions/ comments. 2. Suggestions/ Comments “The Act” means the Companies Act, 2013 Part I – On clause that is covered in the Draft CARO, 2016 1. Para No 3, clause (iii) and 2. Para No 3, clause (xiii) Clause as existing in Draft CARO, 2016 Clause 3(iii) “Whether the company has granted any loans, secured or unsecured to companies, firms or other parties covered by clause (76) of Section 2 of the Companies Act, 2013. If so …” (the rest of the clause is not covered for sake of brevity) Clause

Read More Suggestions on Draft Companies (Auditor’s Report) Order, 2016

Analysing Law of Additional Director

Amitav Ganguly BACKGROUND The provision for appointment of additional directors is a special emergency power available to companies. The appointment lapses when the shareholders would normally assume control over the appointment of the directors at the general meeting. { Ref case: Topandas Mohanlal Advani v. Yeotmal Electric Supply Company {1940} 10 Com Cases 133 , 139: AIR 1940 Sind 87} The provision for additional directors was present in section 260 of the erstwhile Companies Act 1956 which has since been replaced by sub section {1} of section 161 of the Companies Act 2013 { new Act} and the latest law reads as follows: SECTION 161 (1) The articles of a company may confer on its Board of Directors the power to appoint any person, other than a person who fails to

Read More Analysing Law of Additional Director

Precaution in Information Return filing by RBI & Electricity Companies

CA Ashish Chaudhary CA Madhukar N Hiregange Information Return by RBI and Electricity Companies: Precaution to be taken by Manufacturers and Service Providers/Receivers Background Taxes are an important source of revenue to any Government. The government devises mechanism aimed at detecting cases of revenue leakage. It has been witnessed over last few years that there is increased emphasis on making interaction with taxpayers and requiring them to submit various information/records through online or electronic mode. This assists in cross verification of information furnished by assessee before various departments. One of such recent provision introduced in Indirect Taxation was insertion of section 15A under Central Excise Act, 1944 vide Finance Act, 2014. This amendment had provided for imposition of liability on specified persons/authorities like Income Tax, Registrar, Stock Exchange, Banks, Electricity

Read More Precaution in Information Return filing by RBI & Electricity Companies

Startups Cheer: Law eased of Issue of shares & Payment acceptance

 Priyanka Gera Startups’ Cheer – Regulatory Relaxations, Clarifications Relating To Issue Of Shares And Acceptance Of Payments Following the mention of startup friendly measures in its Sixth Bi-monthly Monetary Policy for the year 2015-16, Reserve Bank of India has clarified that the relaxations available to other businesses are applicable to startups as well. Following are the clarifications brought about by the RBI pursuant to the said monetary policy. 1. Acceptance of payments An Indian Start-up having an overseas subsidiary is allowed to open and maintain foreign currency account abroad to collect and pool foreign currency earning against exports/ sales. The balances in this foreign currency account should be repatriated to India within the prescribed time limits of realisation of export dues. Start-ups are also permitted to use Online Payments Gateway Service Providers

Read More Startups Cheer: Law eased of Issue of shares & Payment acceptance

Definitions under CA, 2013 and proposed by Companies Law Committee

  CS Manohar Mishra Definitions under the Companies Act, 2013 (the Act) and proposed by the Companies Law Committee (CLC) The Companies Law Committee (CLC) was set up on the 4th June, 2015 to make recommendations to the Government on the issues arising from the implementation of the Companies Act, 2013 as well as on the recommendations received from the Bankruptcy Law Reforms Committee, the High Level Committee on Corporate Social Responsibility (CSR), the Law Commission and other agencies. The CLC consisted of a former judge of the Delhi High Court, representatives of the Institute of Chartered Accountants of India, the Institute of Cost Accountants of India, the Institute of Company Secretaries of India and the industry. The CLC co-opted representatives from RBI and SEBI as members. The Report of CLC consists of

Read More Definitions under CA, 2013 and proposed by Companies Law Committee