Liberalised Remittance Scheme for Resident Individuals- Reduction of limit from USD 200,000 to USD 75,000

Reserve Bank of India

RBI/2013-14/181
A. P. (DIR Series) Circular No.24

August 14, 2013

To

All Category-I Authorised Dealer Banks

Madam / Sir,

Liberalised Remittance Scheme for Resident Individuals- Reduction of limit from USD 200,000 to USD 75,000

Attention of Authorised Dealer Category – I (AD Category – I) banks is invited to the guidelines regarding the Liberalised Remittance Scheme (LRS) for Resident Individuals (the Scheme).

2. On a review of the scheme, it has now been decided to reduce the existing limit of USD 200,000 per financial year to USD 75,000 per financial year (April – March) with immediate effect. Accordingly, AD Category – I banks may now allow remittance up to USD 75,000 per financial year, under the scheme, for any permitted current or capital account transaction or a combination of both. Further, the following changes / clarifications in regard to the remittances under LRS will come into effect immediately :

(i). The scheme should no longer be used for acquisition of immovable property, directly or indirectly, outside India. Therefore, AD Category-I banks may henceforth not allow any remittances under the LRS Scheme for acquisition of immovable property outside India.

(ii). The scheme should not be used for making remittances for any prohibited or illegal activities such as margin trading, lottery etc., as hitherto.

(iii). Resident individuals have now been allowed to set up Joint Ventures (JV) / Wholly Owned Subsidiaries (WOS) outside India for bonafide business activities outside India within the limit of USD 75,000 with effect from August 5, 2013 and subject to the terms and conditions stipulated in Notification No.FEMA 263/RB-2013 dated August 5, 2013.

3. Further, the limit for gift in Rupees by Resident Individuals to NRI close relatives and loans in Rupees by resident individuals to NRI close relatives in terms of A.P. (DIR Series) Circular No.17 and 18 both dated September 16, 2011 shall accordingly stand modified to USD 75,000 per financial year.

4. All other terms and conditions mentioned in A. P. (DIR Series) Circular No. 64 dated February 4, 2004, A. P. (DIR Series) Circular No. 24 dated December 20, 2006, A. P. (DIR Series) Circular No. 51 dated May 8, 2007, A.P. (DIR Series) Circular No.36 dated April 4, 2008, A.P. (DIR Series) Circular No.17 and 18 both dated September 16, 2011 and A.P.(DIR Series) Circular No. 106 dated May 23, 2013 shall remain unchanged.

5. Necessary amendments to the Notification No. FEMA.1/2000-RB dated May 3, 2000, [Foreign Exchange Management (Permissible Capital Account Transactions) Regulations 2000] are being notified separately.

6. AD – Category I banks may bring the contents of this circular to the notice of their constituents and customers concerned.

7. The directions contained in this Circular have been issued under Section 10 (4) and 11 (1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.

Yours faithfully,

(C.D. Srinivasan)
Chief General Manager

Key Highlights of Companies Bill, 2013

  1. —  Uniform Financial Year for all the Companies i.e from April to March. (Exception where in approval from the National Company Law Tribunal have been granted).
  2. —   A Private Company can now have maximum of 200 members.
  3. —   Concept of One person Company have been introduced. (But the Company can only be incorporated as a Private Company).
  4. —   Object Clause of Memorandum of Association need not be divided into Main, Ancillary and Other Objects Clause.
  5. —   All types of securities are governed by Bill.
  6. —   The money raised by the Company through prospectus, cannot be used for any other purpose other than the purpose for which it was raised unless a special resolution have been passed and the said proposal is published by way of an advertisement. Otherwise an exit opportunity shall be provided to the existing shareholders of the Company.
  7. —  The prospectus has to be more detailed.
  8. —  If a Company, listed or unlisted, makes an offer to allot or invites subscription, or allots, or enters into an agreement to allot, securities to 50 or such higher number as may be prescribed, whether the payment for the securities has been received or not or whether the Company intends to list its securities or not on any recognized stock exchange in or outside India, the same shall be deemed to be an offer to the public and shall accordingly be governed by the provisions provided in this regard by the Securities And Exchange Board of India(SEBI). 
  9. —   There is no provision for issue of shares at a discount (other than issue of Sweat Equity Shares).
  10. —  The provisions of clause related to further issue of capital will now be applicable to all type of companies.
  11. —   Apart from existing shareholders, if the Company having share capital at any time proposes to increase its subscribed capital by issue of further shares, such shares may also be offered to employees by way of ESOP, subject to the approval of shareholders by way of Special Resolution. 
  12. —  Buyback provisions eased. Companies can buy back its shares even if it has defaulted in repayment of deposit or interest payable thereon, redemption of debentures or preference shares or payment of dividend to any shareholder or repayment of any term loan or interest payable thereon to any financial institution or bank, provided that such default has been remedied and three years have lapsed after such default ceased to subsist.  
  13. —  NBFCs not to be covered by the provisions relating to acceptance of deposits. They will be governed by the Reserve Bank of India rules on acceptance of deposits.
  14. —   Companies can accept deposits only from its members after seeking permission of its shareholders at a general meeting.  
  15. —  Certain public companies, as prescribed, can accept deposits from persons other than its members, subject to conditions such as credit rating.
  16. —   Bill provides for registering of all types of charges.
  17. —   Certification of Annual Return by practicing company secretary mandatory in case of companies with prescribed paid up capital and turnover.
  18. —   First annual general meeting of a company shall be held within nine months from the closure of its first financial year .
  19. —  Postal Ballot to be applicable on all Companies, whether listed or not.
  20. —  Every company has to follow the Secretarial Standards while preparing the minutes of board and general meeting.
  21. —   Listed companies required to file a return in a prescribed form with the Registrar regarding any change in the number of shares held by promoters and top 10 shareholders of such company, within 15 days of such change.
  22. —   Listed public companies to prepare a report, in the manner as may be prescribed, on each annual general meeting including the confirmation that meeting was convened, held and conducted as per the Act and the Rules made thereunder.
  23. —  Interim dividend declared by a Company in a current financial cannot exceed the average rate of dividend of the preceding three years if a company has incurred loss up to the end of the quarter immediately preceding the declaration of such dividend.
  24. —   Transferring of a fixed percentage of profits to reserve before declaration of dividend is not mandatory in the Bill.
  25. —   Financial Statements shall include Balance Sheet, Profit & Loss Account and Cash Flow Statement collectively.
  26. —   Provisions for re-opening or re-casting of the books of accounts of a company provided.
  27. —  The National Advisory Committee on Accounting Standards renamed as The National Financial Reporting Authority.
  28. —  The authority to advise on Auditing Standards and Accounting Standards.
  29. —  Every company is required at its first annual general meeting (AGM) to appoint an individual or a firm as an auditor. The auditor shall hold office from the conclusion of that meeting till the conclusion of its sixth AGM and thereafter till the conclusion of every sixth meeting. The appointment of the auditor is to be ratified at every AGM.
  30. —  Individual auditors are to be compulsorily rotated every 5 years and audit firm every 10 years in listed companies & certain other classes of companies, as may be prescribed.
  31. —   Prescribed class or classes of companies to have atleast one woman director.
  32. —   At least one director should be a person who has stayed in India for a total period of not less than 182 days in the previous calendar year.
  33. —  At least one-third of the total number of directors of a listed public company should be independent directors. Existing companies to get a transition period of one year to comply.
  34. —   Companies can have maximum of 15 directors.
  35. —  A person can hold directorship of up to 20 companies, of which not more than 10 can be public companies. The number 20 to include Private Companies aswell.
  36. —   A director can participate in a board meeting through video conferencing or other audio visual mode as may be prescribed.
  37. —  A notice of not less than 7 days in writing is required to call a board meeting. The notice of meeting to be given to all directors, whether he is in India or outside India by hand delivery post or electronic means.
  38. —   Every company with more than 1,000 shareholders, debenture-holders, deposit-holders and any other security holders at any time during a financial year shall constitute a Stakeholders Relationship Committee consisting of a chairperson who is a non-executive director and such other members as may be decided by the board.
  39. —  In a private company, an interested director cannot vote or take part in the discussion relating to any matter in which he is interested.
  40. —  The provisions related to inter-corporate loans and investments (section 372A of Companies Act, 1956) has been extended to include loans and investments to any person. 
  41. —  Loans can be given to a Director without seeking permission of the Central Government.
  42. —   No central government approval required for entering into any related party transactions.
  43. —   No approval of the central government required for appointment of any director or any other person to any office or place of profit in the company or its subsidiary.
  44. —  The Bill prohibits insider trading in the company. 
  45. —  The Bill provides provisions related to Corporate Social Responsibility (CSR).
  46. —  Provisions relating to the appointment of managing director/whole time director/manger to apply to a private company.
  47. —   The Bill provides for provision related to secretarial audit in certain prescribed class or classes of companies.
  48. —  The Bill prescribes the functions of a company secretary.
  49. —   The conditions under which the Registrar can remove the name of a company from his record have been changed.
  50. —  The Registrar of Companies has been empowered to file an application with the Tribunal for restoration of the name of a company where the company was struck off inadvertently or on the basis of the incorrect information.
  51. —  The manner of declaring a company sick and process of its revival and rehabilitation has been completely rationalized.
  52. —   Any document or returns required to be filed under this Bill, if not filed within prescribed time, have to be filed within a period of 270 days on payment of such additional fees as may be prescribed.
  53. —   New definition of Nidhi Company prescribed.
  54. —   The person to be appointed as President of the Tribunal shall be the judge of the High Court for atleast 5 years, as opposed to the Companies Act 1956, where no term has been prescribed for High Court Judge to be appointed as President; the only condition was that the person should be qualified for being a judge of high court.
  55. —  The National Company Law Appellate Tribunal shall now consist of a combination of technical and judicial members not exceeding 11, instead of 2 as provided in the Companies Act 1956.
  56. —  The Bill makes provision for cross border amalgamations between Indian companies and companies incorporated in the jurisdictions of such countries as may be notified from time to time by the central government.

http://www.mukeshraj.com

 

RBI allows use of ECB fund for import of services

Reserve Bank of India relaxed ECB norms and allowed companies to use the overseas debt to pay for import of services, technical know-how and licence fee as part of capital goods imports.

Currently, eligible entities can raise ECB (external commercial borrowing) for investment such as import of capital goods, new projects, modernisation/expansion of existing production units in industrial sector, infrastructure sector and entities in the service sector.

“On review, it has been decided to include import of services, technical know-how and payment of licence fees as part of import of capital goods by the companies for the use in the manufacturing and infrastructure sectors as permissible end uses of ECB…,” RBI said.

The modifications to the ECB guidelines have come into force with immediate effect. The rupee today tanked by a massive 106 paise to close at all-time low of 60.72 against dollar on heavy capital outflows and month-end dollar demand from importers. In a separate notification, RBI also said it has been decided that credit enhancement can be provided by eligible non-resident entities to the domestic debt raised through issue of INR bonds/ debentures by all borrowers eligible to raise ECB under the automatic route.

“It has also been decided to reduce the minimum average maturity of the underlying debt instruments from seven years to three years,” it said. Prepayment and call/put options, however, would not be permissible for such capital market instruments up to an average maturity period of three years, the RBI added. As of now, credit enhancement is permitted to be provided by multilateral financial institutions, Government-owned development financial institutions, foreign equity holder(s) for domestic debt raised through issue of capital market instruments by Indian companies engaged in development of infrastructure and by IFC’s.

PHONE NUMBERS OF DIN CELL AND HELP DESK

Stakeholders are hereby informed that operator for MCA21 project is changing w.e.f. 17.01.2013 from M/s. TCS Ltd to M/s. Infosys Ltd. Due to this the new contact numbers for DIN Cell and Help desk will be:

DIN Cell    : 0124-4583766 – 69

Help Desk    : 0124-4832500

No deduction of tax in certain cases

NOTIFICATION NO. 56/2012 [F. NO. 275/53/2012-IT(B)], DATED 31-12-2012

In exercise of the powers conferred by sub-section (1F) of section 197A of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies that no deduction of tax under Chapter XVII of the said Act shall be made on the payments of the nature specified below, in case such payment is made by a person to a bank listed in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934), excluding a foreign bank, namely:-

(i)  bank guarantee commission;

(ii)  cash management service charges;

(iii)  depository charges on maintenance of DEMAT accounts;

(iv)  charges for warehousing services for commodities;

(v)  underwriting service charges;

(vi)  clearing charges (MICR charges);

(vii)  credit card or debit card commission for transaction between the merchant establishment and acquirer bank.

2. This notification shall come into force from the Ist day of January, 2013.

Toll Free Number for search for Dealer Registered under Central Sales Tax

 

Toll Free Number for TIN Verification of Dealers Registered under Central Sales Tax Act :   

 

                                         1800 2200 17  

 

Steps to be followed for TIN Verification : 

1) Please dial the toll free number 1800 2200 17 from a BSNL / MTNL landline phone from anywhere in India.
2) Welcome message will be played by the Interactice Voice Response (IVR) System.
3) The system will prompt you to choose ‘1’ for English ‘2’ for Hindi”.
4) Select the required language.
5) The system will prompt you to enter the 11 digit TIN of the dealer you wish to verify.
6) Now enter the 11 digit TIN number.
7) The system will prompt you the dealer details of the corresponding TIN.

New Circle rates in Delhi

 

The Present Circle Rates of the Residential Properties in Eight Categories of Colonies in Delhi

The Government of Delhi has introduced the new circle rates in eight categories of colonies in Delhi with effect from December 05, 2012.

The Delhi government had first introduced the circle rates for the real estate properties in Delhi in July 2007. These rates were notified under the provisions of Delhi Stamp (Prevention of Undervaluation of Instruments) Rules, 2007 on July 18, 2007.

At present, there are eight categories of colonies in the Delhi — A, B, C, D, E, F, G, and H based on the Municipal Corporation of Delhi (MCD) categorization. The circle rates vary depending on the category of a colony or residential area in Delhi.

As notified by the Government of Delhi, with effect from December 05, 2012 the new circle rates of real estate properties in Delhi based on the colonies categorization are:

Category A Colonies – Rs. 645,000 Per Square Meter
Category B Colonies – Rs. 204,600 Per Square Meter
Category C Colonies – Rs. 131,040 Per Square Meter
Category D Colonies – Rs. 106,384 Per Square Meter
Category E Colonies – Rs. 58,316 Per Square Meter
Category F Colonies – Rs. 47,141 Per Square Meter
Category G Colonies – Rs. 37,820 Per Square Meter
Category H Colonies – Rs. 19,361 Per Square Meter

From November 16, 2011 to December 04, 2012, the circle rates of real estate properties in Delhi were:

Category A Colonies – Rs. 215,000 Per Square Meter
Category B Colonies – Rs. 136,400 Per Square Meter
Category C Colonies – Rs. 109,200 Per Square Meter
Category D Colonies – Rs. 87,200 Per Square Meter
Category E Colonies – Rs. 47,840 Per Square Meter
Category F Colonies – Rs. 38,640 Per Square Meter
Category G Colonies – Rs. 31510 Per Square Meter
Category H Colonies – Rs. 15,870 Per Square Meter

From February 08, 2011 to November 15, 2011, the circle rates of real estate properties in Delhi were:

Category A Colonies – Rs. 86,000 Per Square Meter
Category B Colonies – Rs. 68,200 Per Square Meter
Category C Colonies – Rs. 54,600 Per Square Meter
Category D Colonies – Rs. 43,600 Per Square Meter
Category E Colonies – Rs. 36,800 Per Square Meter
Category F Colonies – Rs. 32,200 Per Square Meter
Category G Colonies – Rs. 27,400 Per Square Meter
Category H Colonies – Rs. 13,800 Per Square Meter

From July 18, 2007 to February 07, 2011, the circle rates of real estate properties in Delhi were:

Category A Colonies – Rs. 43000 Per Square Meter
Category B Colonies – Rs. 34100 Per Square Meter
Category C Colonies – Rs. 27,300 Per Square Meter
Category D Colonies – Rs. 21,800 Per Square Meter
Category E Colonies – Rs. 18,400 Per Square Meter
Category F Colonies – Rs. 16,100 Per Square Meter
Category G Colonies – Rs. 13,700 Per Square Meter
Category H Colonies – Rs. 6900 Per Square Meter

Liaison Office (LO) / Branch Office (BO) in India by Foreign Entities – Reporting to Income Tax Authorities

RBI/2012-13/311
A.P. (DIR Series) Circular No. 55

November 26, 2012

To

All Authorised Dealers Category – I Banks

Madam / Sir,

Liaison Office (LO) / Branch Office (BO) in India by Foreign Entities – Reporting to Income Tax Authorities.

  1. Attention of Authorised Dealer Category – I banks is invited to A.P. (DIR Series) Circular No. 24 dated 30.12.2009 in terms of which LOs/BOs are required to furnish copy of the Annual Activity Certificate (AAC) to Director General of Income Tax (International Taxation), Drum Shaped Building, I.P. Estate, New Delhi 110002.
  2. It is clarified that copies of the AACs submitted to the DGIT (International Taxation) should be accompanied by audited financial statements including receipt and payment account.
  3. Further, at the time of renewal of permission of LOs by AD banks, they may note to endorse a copy of each such renewal to the office of the DGIT (international Taxation).
  4. AD Category – I banks may bring the contents of this circular to the notice of their constituents/customers concerned and ensure compliance.
  5. The directions contained in this circular have been issued under Sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.

Yours faithfully,

(Rudra  Narayan Kar)
Chief General Manager

PF withdrawal permitted for International Workers from Social Security Agreement countries

Employees’ Provident Funds (Fourth Amendment) Scheme, 2012
MINISTRY OF LABOUR AND EMPLOYMENT
NOTIFICATION

New Delhi, the 5th October, 2012

*G.S.R. 744(E).- In exercise of the powers conferred by section 5, read with sub-section (1) of section 7 of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (19 of 1952), the Central Government hereby makes the following Scheme further to amend the Employees’ Provident Funds Scheme, 1952, namely:-

1. (1) This Scheme may be called the Employees’ Provident Funds (Fourth Amendment) Scheme, 2012.

(2) It shall come into force on the date of its publication in the Official Gazette.

2. In the Employees’ Provident Funds Scheme, 1952 (hereinafter referred to as the principal Scheme), under paragraph 83 relating to special provisions in respect of International Workers.-

(a) in paragraph 69 of the principal Scheme, as modified by para 6 of aforesaid paragraph 83, for sub-paragraph (4), the following sub-paragraph shall be substituted, namely:-

“(4) In respect of a member covered under social security agreement entered into between Government of India and any other country, on ceasing to be an employee in an establishment covered under the Act.”;

(b) in paragraph 72 of the principal Scheme, as modified by para 7 of aforesaid paragraph 83, for sub-paragraph (2), the following sub-paragraph shall be substituted, namely:-

“(2) The due amount in respect of the member shall be payable in the payees bank account directly or through the employer”.

[F.No.S-35025/09/2011-SS-II]
RAVI MATHUR, Addl. Secy.

Foot Note: The Employees’ Provident Funds Scheme, 1952 was published in the Gazette of India, Part-II, Section 3, Sub-section (i), vide number S.R.O. 1509, dated the 2nd September, 1952 and lastly amended vide number G.S.R.382(E), dated the 24th May, 2012.

Export of Goods and Services – Simplification and Revision of Softex Procedure

A. P. (DIR Series 2012-13) Circular No. 47, dated 23-10-2012

Attention of the Authorised Dealers is invited to regulation 6 of the Notification No. FEMA 23/2000-RB, dated May 3, 2000 viz. Foreign Exchange Management (Export of Goods and Services) Regulations, 2000, as amended by the Notification No.FEMA.36/2001-RB, dated February 27, 2001, in terms of which designated officials of the Ministry of Information Technology, Government of India at the Software Technology Parks of India (STPIs) or at Free Trade Zones (FTZs) or Export Processing Zones (EPZs) or Special Economic Zones (SEZs), had been authorized to certify exports declared through SOFTEX Forms.

2. Considering the spurt in the volume of software exports from India in recent times, the complexity of work contracts involved, the voluminous nature of contract agreements and the duration involved in execution of each contract as well as the time-consuming process involved in the certification of SOFTEX forms, simplified and revised Softex procedure was introduced vide A.P. (DIR Series) Circular No. 80, dated February 15, 2012. Initially the revised procedure was applicable in STPI at Bangalore, Hyderabad, Chennai, Pune and Mumbai with effect from April 1, 2012.

3. Since the revised procedure is running successfully at the 5 designated centres, it has been decided to implement the revised procedure in all the STPIs in India with immediate effect.

4. As per the revised procedure, a software exporter, whose annual turnover is at least Rs.1000 crore or who files at least 600 SOFTEX forms annually on all India basis, will be eligible to submit a statement in excel format as detailed in our A.P. (DIR Series) Circular No.80 dated February 15, 2012.

5. Authorised Dealers may bring the contents of this circular to the notice of their constituents concerned.

6. The directions contained in this circular have been issued under section 10(4) and section 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions/approvals, if any, required under any other law.