Current Affairs for Bankers Till October 2020
Financial Developments
General Awareness
Compliation under guidance of Sh.N S TOOR
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Financial Awareness CENTRE TO CREATE MULTIPLE APP STORES IN COUNTRY: The
Government will facilitate the creation October 2020 of multiple app stores in the country to CBDT ISSUES NORMS FOR TDS give competition to Google’s Play Store. AND TCS ON E-COM: CBDT has Ultimately, monopoly of one market issued the norms for Tax Deducted at player is not good. Whether it is Google Source (TDS) by e-Com Operators and or anybody else, it has to be fair to all Tax Collected at Source (TCS) on sales stakeholders. The Government could set of goods exceeding Rs.50 Lakh. TDS up a play store but the real solution will refers to payment made after deduction lie in enabling multiple such platforms of tax at specified rate while TCS is to ensure competition in the payment received along-with tax amount marketplace. The Government can at a specified rate. Both these intend to oversee the interests of App developers. curb tax evasion. Rate of TDS by the e- GOVT. EXTENDS TIME FOR commerce operator will be 1% while DEPOSIT REPAYMENT RESERVE: rate of TCS would be 0.1%. For TDS, The Government has extended the threshold for payment has been kept at timeline for another three months up to Rs.5 Lakh while for TCS, the threshold December 2020 for compliance with is Rs.50 Lakh. TDS and TCS will not be creation of a Deposit Repayment applicable on transactions in securities Reserve. It has also extended by three and commodities that are traded through months the timeline for investment of a recognised stock exchanges or cleared portion of their maturing debentures in and settled by the recognised clearing 2020-21 in liquid instruments. Two corporation, located in the IFSC. extensions in time has been already SEBI ISSUES NEW FRAMEWORK allowed by the Government which was ON DEPOSITORY RECEIPTS: SEBI valid up to June 30 and then till has issued the new framework to September 30.Under Company Law, monitor foreign holding in Depository India Inc would have had to create by Receipts (DRs). Under the framework, a April-end a Deposit Repayment Reserve listed company will appoint one of the of 20% of deposits maturing during Indian depositories as the designated Fiscal 2020-21. Corporates are also depository for the purpose of monitoring required to invest or deposit at least 15% of limits in respect of depository of the amount of maturing debentures receipts. The designated depository in during the financial year in liquid coordination with domestic custodian, instruments. With extension of timeline other depositories will compute, monitor for compliance, corporates will get to and disseminate the DR’s information as use their deposits and resources prescribed in the framework. Further, the efficiently for the benefit of their information will be disseminated on the employees and their sustenance. This is websites of both the Indian depositories. expected to ease the liquidity crunch For this purpose, the designated being faced by the entities amid the depository will act as the lead depository ongoing Covid-19 disruption. and the other depository will act as feed BILATERAL NETTING LAW depository. BECOMES OPERATIONAL: The Centre has operationalised all the
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provisions of the Bilateral Netting of option to pay 35% of the net cash tax Qualified Financial Contracts Act from liability of the last quarter using an auto- October 1. The law now provides an generated challan. An assessee having unambiguous legal framework for turnover below Rs.5 Crore will have enforceability of netting of a qualified three options. First, continue with the financial contract. Prior to the existing system of filing returns on a legislation, India did not have a legal monthly basis and pay the tax due. framework for bilateral netting. Netting Second, using the quarterly return filing enables two counter parties in a bilateral system with payment of a certain financial contract to offset claims against percentage of tax due during the first each other to determine a single net three months and settle the whole payment obligation due from one amount along-with the return in the third counter party to others in event of month. Third, if there is no tax due then default. Netting will help in evaluating do not pay on a monthly basis and file risks on a far more real time basis and NIL return in the third month through actual risk assessment will happen rather SMS bases system. than notional assessment based on gross SEBI ISSUES DETAILED figure. FRAMEWORK FOR EVALUATION IR CODE NOTIFIED ALLOWS OF RISK: SEBI has issued the detailed CONVERTING PERMANENT framework for evaluation and disclosure JOBS: The Centre has done away with of risk associated with investing in the safeguard provision that deterred mutual funds. SEBI has added one more employers from converting permanent level of risk-”Very High” to the existing jobs into fixed term contracts. The five levels of risks. Under the existing Industrial Relations (IR) Code 2020 system, risk in MF scheme is gauged in which has been notified has allowed terms of the risk to the principal. This firms to hire contract workers directly essentially boils down to the risk level through a fixed term contract. Earlier, depending on the scheme category. Once firms had to go through a contract to hire the new methodology takes effect, the contract workers –an expensive and risk level of each MF scheme will be cumbersome process. Fixed term evaluated based on its actual portfolio contract workers are entitled to receive composition and not merely the category all statutory dues that permanent to which it belongs. Now the risk will be workers in the same unit get. But such evaluated after taking into several workers unlike permanent employees are factors and not simply the risk to the not entitled to retrenchment principal. compensation. E-INVOICING SYSTEM STARTS FILING OF GST RETURNS MADE AND MADE MANDATORY: E- EASY BY GOVT.: The Government invoicing System which has been made has said that the small tax payers having mandatory for GST assesses with a the aggregate annual turnover less than turnover of Rs.500 Crore or more from Rs.5 Crore will be allowed to file returns October 1 has started. E-invoicing on a quarterly basis with monthly involves reporting details of specified payments from January 1, 2021. Such GST documents to a Government- quarterly tax payers would for the first notified portal and obtaining a reference two months of the quarter, have an number. Those registered can continue
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to create GST invoices on their own penetration. This is all the more urgent accounting/ERP systems. Once the in the current context of the pandemic invoices are reported to the invoice when millions of Indians especially in registration portal, the IRP, after the informal sector have lost their digitally signing the e-invoice and livelihoods and are now leading more adding a QR code, returns the e-invoice unsecure lives and are falling back into with a unique IRN. A GST invoice is poverty. Micro insurance companies valid only if it has a valid IRN. It has should be allowed to act as composite been clarified that invoices raised by insurers to transact both life and non-life notified taxpayers during October business through a single entity. Their without following the e-invoice portfolios should have a balance of both procedure, will be deemed to be valid life and non-life business. and no penalty will be levied if the IRN SEBI UNVEILS PROCEDURE FOR is obtained within 30 days of the date of DEBENTURE TRUSTEES: SEBI has the invoice. come out with a uniform procedure that SEBI TIGHTENS INTER-SCHEME needs to be followed by debenture TRANSFER OF SECURITIES: SEBI trustees in case of default by issuers of has tightened regulations for inter- listed debt securities. The process scheme transfers (IST) within the same includes seeking consent from the mutual fund house by banning transfer investors for enforcement of security or of investment in close-ended schemes for entering into an Inter-creditor after three business days of allotment. Agreement (ICA). International Thereafter, no ISTs will be permitted. At securities identification number (ISIN) is present, transfer of securities from one used for uniquely identifying securities scheme to another scheme in the same like stocks, bonds, warrants and mutual fund is allowed only if such commercial papers. SEBI said the transfers are done at the prevailing resolution plan in the ICA may involve market price and the securities so restructuring, including roll-over of debt transferred are in conformity with its securities, requiring consent of the investment objective. For open-ended investors. schemes, ISTs may be allowed only for ALL FOUR LABOUR CODES TO meeting liquidity requirements due to GO LIVE FROM APRIL: The unanticipated redemption pressure. Government intends to implement all the IRDAI PANEL FOR LOWER four labour codes from April1. These ENTRY-LEVEL CAPITAL: The four codes will subsume all existing 29 IRDAI Committee has suggested Central laws. The four codes are- reduction in entry-level capital Industrial Relations Code, Code on requirement for stand-alone micro- Occupational, Safety, Health and insurance companies to Rs.20 Crore Working Conditions, Social Security from the current Rs.100 Crore with a Code and Code on Wages. These codes view to accelerate expansion of this have already been enacted after passed segment of insurance market in the by Parliament and accented by the country. The Committee said that like President earlier this month. These codes other nations, India too will need to will establish transparent, answerable attract multiple players if it wants to and simple mechanism reducing to one substantially increase insurance registration, one licence and one return
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for all codes. Fixed-term employees’ JANUARY: IRDAI has come out with a service conditions, salary, leave and standard individual term life insurance social security will be the same as a product called Saral Jeevan Bima. This regular employee. In addition, fixed term will be mandatorily offered by all the employee has also been given the right life insurance companies from January to pro-rata gratuity. 1, 2021 onwards. Insurers have to file NCLAT RULING ON DEFAULT the product with the regulator latest by THRESHOLD: The Ministry of December 1. The minimum sum assured Corporate Affairs (MCA) notified on under the product will be Rs.5 lakh and March 24 the enhanced minimum the maximum can go up to Rs.25 lakh. amount of default limit of Rs.1 Cr for However the insurer will have the option initiating corporate insolvency process of providing sum assured beyond Rs.25 (CIRP). It will provide relief to small lakh. While the minimum age of entry is and medium businesses as it by and 18 years the maximum has been capped large prevented the start of insolvency at 65. The maximum maturity age will proceedings against MSMEs amid the be 70 years. The policy term will extend pandemic. Now National Company Law from 5 to 40 years. The product will be Appellate Tribunal (NCLAT) has ruled offered without restrictions on gender, that the revised default threshold of Rs.1 place of residence, travel, occupation or Cr for trigger of corporate insolvency educational qualifications. applies prospectively from March 24 and FINMIN CLEARS AIRCRAFT not retrospectively. This would mean LEASE FINANCING FROM GIFT that those applications before March 24 CITY: The Finance Ministry has that had debt default of less than rs.1 Cr cleared, making India a Hub for but over Rs.1 lakh can be admitted for financing aircraft purchasing and leasing corporate insolvency process. activities. It notified “Aircraft Lease” as BASE YEAR OF CP INDEX TO BE a financial product that can be transacted REVISED: Govt.plans to change the at Gujarat’s GIFT City, the country’s base year for the Consumer Price (CP) sole international financial services Index for Industrial workers to 2016 centre. The move is expected to pave the from 2001. This could mean further way for “onshoring” aircraft leasing and increase in Dearness Allowance (DA) financing which is the most profitable and Dearness Relief (DR) when revised segment of the aviation value chain. It from next year. DA as a percentage of will support local carriers which had basic pay is paid to serving government placed orders for more than 1000 officers and employees while DR is as a aircraft, making it the third largest order percentage of basic pensions are for book in the world behind the US and retired officers and employees. Amidst China. the pandemic, the Government had CENTRE NUDGES LARGE decided to freeze DA/DR at the current CORPORATES TO CLEAR DUES 17% of basic pay/pension rates till July OF MSMEs: Encouraged by the strong next year. The revision will make base response from the top 500 companies to year closer to current scenario and thus clear dues of MSMEs, the Centre has the rate of inflation more realistic. written to the top management of over IRDAI TO OFFER STANDARD 2800 corporates by name asking them to TERM LIFE POLICY FROM clear the dues of MSMEs by the end of
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this month. Timely clearance of purview. However it would not apply to receivables will help MSMEs better transactions of securities and leverage the festive season. Further to commodities traded through recognised solve the cash flow problem of MSMEs, stock exchanges or cleared and settled a bill discounting mechanism has been by recognised clearing corporations. started by RBI, called Trade Receivables FINMIN ISSUES GUIDELINES ON Discounting System. It is mandatory for BONUS: Finance Ministry has issued all CPSEs and companies with a the guidelines for disbursement of turnover of more than Rs.500 Crore to bonus. One of the key conditions for join this platform. eligibility is at least six months of FSSAI’s NEW COMPLIANCE continuous service during FY 20. PLATFORM TO BECOME Eligible employees are allowed pro-rata OPERATIONAL FROM payment for continuous service during NOVEMBER 1: The Food Safety and the year from six months to full year. Standards Authority of India (FSSAI) is Employees appointed on purely to launch its cloud-based and upgraded temporary/ ad-hoc basis are eligible food safety compliance online platform subject to fulfilling the conditions of six across the country from November 1. months of continuous service from The Food Safety Compliance System is March 31, 2020 without a break. conceptualised to provide one-point stop Contract employees can also get the for all engagement of an FBO with the bonus provided they are eligible for department for any regulatory benefits such a DA and interim benefits. compliance transaction. For the start, the If these benefits are not available then system will be offering licencing, the bonus will be on par with casual registration, inspection and annual return labour. modules. Sample management, CBDT ALLOWS RPFT TO INVEST improvement notices, adjudications, IN LR INSTRUMENTS: CBDT has audit management system etc allowed the recognised provident fund activities/modules will be enabled in a trusts (RPFT) to invest in lower-rated phased manner in future. (LR) instruments. The new norms will MFs, AIFs UNDER AMBIT OF NEW come into effect on April 1, 20201. TAX NORMS: Mutual funds (MFs) and “AA” rated instruments will be Alternative Investment Funds (AIFs) substituted by “A”. “AA” rated have come under the ambit of new tax securities are less risky than “A” rated collected at source (TCS) regime, which ones. This change would lead to came into effect on October 1. investment of PF monies in securities According to the Finance Act, 2020, a that hitherto were not permitted. seller is to deduct tax equal to 0.1% of Recognised PFs can invest at least 35% the sale proceeds if the value of goods of the investment fund which can go up sold exceeds Rs.50 Lakh in a financial to 45%. year. The collection is to be made at the GOVT. ROLLS OUT COMPOUND time of transaction. Since TCS INTEREST WAIVER SCHEME: To provisions apply to the sale of goods by offer relief to small borrowers, the a seller whose turnover exceeded Rs.10 Government has rolled out the Crore in the preceding financial year, all compound interest waiver scheme. The MFs and AIFs may fall within its relief will be paid to the borrower in the
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form of grant of ex-gratia payment of entities or citizens of neighbouring difference between compound interest countries sharing land border with India and simple interest for six months from allowing such investments to be made March 1 to August 30. For eligibility only through the Government route. The under the scheme, the aggregate Policy also weaves in the 26% cap on outstanding amount across all loan FDI in uploading or streaming of news accounts of the borrower should not and current affairs through digital media. exceed Rs.2 Crore across all lending In the event of the transfer of ownership institutions as on February 29, 2020. of any existing or future FDI in an entity Further the account should be standard in India directly or indirectly resulting in and not an NPA as on February 29. Such the beneficial ownership will also borrowers will be eligible for the benefit require Government approval. irrespective of whether they opt for the moratorium or not. The difference September 2020 between compound interest and simple interest for the six months period will be RBI TO EASE LIQUIDITY credited to the borrower’s account. If PRESSURE IN MARKET: RBI has loan account has been closed mid-way announced measures, including two then the relief will be for the period more trenches of “Operation Twist” between March 1 and the date of closure aggregating Rs.20, 000 Crore and Term of the account. Repo Operations aggregating Rs.1 DIPAM TO MONETISE PUBLIC Lakh Crore in September, to cool the SECTOR ASSETS: The Department of rising bond yields and ease liquidity Investment and Public Asset pressures seen arising due to advance Management (DIPAM) has decided to tax outflows. RBI has also created more monetise assets of Central Public Sector room under the so called “Held-to- Enterprises (CPSEs), Public Sector Maturity” HTM category, which banks Undertakings (PSUs) and immovable can utilise from September 1 to park enemy properties apart from assets of their fresh G-Secs acquisitions. other Government organisations. The Currently, banks are required to Government has set the threshold for maintain 18% of their Net Demand and executing authority to monetise assets Time Liabilities (NDTL) in SLR. The having value of Rs.100 Crore and above extant limit for investment that can be under the framework. Further assets held in the HTM category is 25% of the below value of Rs.100 Crore would be total investment. Banks are allowed to monetised by the owner exceed this limit provided the excess is (CPSE/Administrative Ministry/ invested in SLR within an overall limit Department) following their extant of 19.5% of their deposits. Now RBI process. DIPAM is a part of Finance has allowed banks to hold fresh Ministry and mainly known as the nodal acquisitions of SLR from September 1 department for disinvestment. under HTM up to an overall limit of GOVT. UNVEILS CONSOLIDATED 22% of NDTL up to March 31, 2021. FDI POLICY: The Government has DGFT FOR BENEFITS UNDER unveiled the consolidated FDI Policy MEIS: The Directorate General of 2020 incorporating the restrictions Foreign Trade (DGFT) has capped the notified earlier this year on FDI from benefits earned by exporters under the
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popular Merchandise Export from India central employees, a sum of Rs.510.86 Scheme (MEIS) at Rs.2 Crore per Crore will be spent over a period of five exporter on exports made in the four- years from 2020-21 to 2024-25. The month period from September 1 to key focus of the programme will be to December 31. It has also been notified transition from “Rules-based” to that any Import-Export Code (IEC) “Roles-based” HR Management and holder who has not made any export for aligning of work allocation of civil a period of one year preceding servants by matching their September 1 or any new IEC obtained competencies to the requirements of the on or after the date of notification will post. not be eligible for submitting any claim RBI ALLOWS BANKS TO under MEIS. Further the Scheme of REVERSE LTRO MEIS will be withdrawn with effect TRANSACTIONS: RBI has said that from January 1, 2021. the banks can exercise the option of CA INSTITUTE FOR NEW reversing Long-term Repo Operations STANDARDS FOR ACCOUNTING: (LTRO) transactions whereby they The Institute of Chartered Accountants availed themselves of funds between of India (ICAI) proposes to come out February 17, 2020 and March 18, 2020 with a set of Forensic Accounting and through a repayment exercise which Investigation Standards (FAIS) The will be spread over five days, beginning new standards are expected to be ready September 14. RBI infused liquidity by end-December and will raise the aggregating Rs.1,25,117 Crore by quality benchmark of forensic conducting five LTRO transactions engagements. FAIS will be mandatory between February 17 to March 18, for the members of the CA Institute and 2020 at the then prevailing policy Repo non-adherence will invite disciplinary rate of 5.15% in a bid to improve action. Further even if FAIS is monetary policy transmission. By conducted by a non-audit international exercising the option of reversing firm, any member of the institute LTRO transactions before maturity, signing such report would be required banks can reduce their cost of funds as to follow the FAIS. The CA Institute the policy Repo rate has come down to will be first body in the accounting 4%. world to develop a full set of FAIS RBI TIGHTENS BANK AUDIT standards for forensic professionals and WITH LONG-FORMAT stakeholders. REPORTS: RBI has asked banks to UNION CABINET APPROVES put into operation starting FY 21, a MISSION KARMAYOGI: The Union revised Long Format Audit Report Cabinet has approved the launch of (LFAR) whereby Statutory Central Mission Karmayogi Programme to Auditors (SCAs) will be required to bring comprehensive reforms in civil comment on adverse features services. Under the scheme, a Capacity considered significant in Top 50 Building Commission will be set up standard large advances and the and Special Purpose Vehicle (SPV) will accounts that need the management’s be created for owning. It will also have attention. The LFAR will cover risks a coordination unit headed by the associated with credit, market and Cabinet Secretary. To cover 46 Lakh operational and also look at capital SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 6
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adequacy, going concern assessment enhance liquidity in India’s bad loan and information systems. The SCAs market, freeing up banks to lend afresh. will need to examine and comment on FPIs are known for their big-ticket recovery from all the written-off purchases. Hence FPIs may soon be accounts during the financial year. RBI able to directly acquire bad loans being also said that an examination of sold by banks and other lenders. inactive and inoperative accounts might CENTRE GIVES FLEXIBILITY also be carried out as it is a fraud-prone ON STRCTURING area. CONVERTIBLE NOTES FOR LIC ACT TO BE AMENDED BY START-UPS: The Centre has CENTRE: The Government is sweetened the deal for Start-ups by preparing for getting the LIC Act 1956 allowing them to raise funds through to be amended to facilitate the public convertible instruments on extended issue. The amendment is required to terms of repayment-up to 10 years achieve at least three objectives- list the without being categorised as “deposits” insurer as a corporation and not as a for company law compliance purposes. company, expand its paid up capital A convertible bond is a debt security and ensure that it continues to give that provides an investor with a right to sovereign guarantee to policyholders. exchange the bond for pre-determined LIC’s original capital was Rs.5 Crore number of shares on a maturity debt. which was enhanced to Rs.100 Crore Till then the bond holders will get after the 2011 LIC Act amendment. interest on the money invested through Though the Government has not the convertible note or bond. Prior the disclosed how much of its shareholding change the maximum repayment period will be offloaded through the IPO it is for the convertible note was five years. expected to be 10%. Once listed, an GOVT. TO IMPLEMENT RODTEP entity is required to have at least 25% SCHEME REPLACING MEIS: The of public shareholding – share owned Government is identifying sectors for by those other than promoters-within priority implementation of the New three years. Remission of Duties or Taxes on FPIs TO BUY BAD LOANS Export Product (RODTEP) Scheme DIRECTLY: Foreign Portfolio which aims at refunding exporters Investors (FPIs) are permitted to in indirect taxes paid on inputs by invest in listed securities, debt replacing the popular Merchandise instruments and hybrid paper such as Export from India Scheme (MEIS) that real estate investment trusts. FPIs can is incompatible with World Trade currently invest in stressed assets Organisation (WTO) norms. The indirectly. ARCs acquire them from RODTEP Scheme will be available for lenders and in turn issue security all export items but the process of data receipts which FPIs can buy. This collection for fixing rates is laborious process has not been successful as and time-consuming. That is why the ARCs were also involved. Now RBI scheme may be extended to few priority and SEBI have in principle agreed for sectors first and then subsequently to having more FPI participation in the rest of the items. The Centre plans stressed assets. The move on FPI’s to withdraw MEIS which has been participation is part of RBI’s efforts to ruled as being in violation of SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 7
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multilateral trade rules by the WTO at and small-caps each. The fund the end of this year and items that managers will have the discretion to currently enjoy benefits under it would invest the remaining 25% in any instead benefit under the RODTEP category or to keep it as cash. Earlier, scheme. there was no such minimum threshold. UNION CABINET APPROVES IBBI TO RAISE GOVERNANCE SOCIAL SECURITY CODE: The QUOTIENT OF IPAs: Currently, the Union Cabinet has approved the Social insolvency professional has a two tier Security Code which will have enabling regulatory architecture with the provision to allow self-employed Insolvency and Bankruptcy Board of workers to make voluntary contribution India (IBBI) as the Principal Regulator towards the EPF. The Code has made and three Insolvency Professional provisions for contribution from Agencies (IPAs) as front-line companies towards Gig workers. regulators. IBBI proposes to introduce Further the workers employed in the minimum qualifications, experience Gig economy will also be eligible for and other criteria for the appointment of insurance benefits provided by the directors of the IPAs, the Front-line State-run ESIS. This is the First Time regulators of Insolvency Professionals that such workers will be covered under (IPs). It wants the governing board of India’s Social Security Law. IPAs to periodic self-evaluation of IRDAI ISSUES NEW HEALTH three dimensions of board composition COVER GUIDELINES: IRDAI’s and quality, board meetings and new norms will drive growth in health procedures and board functions and insurance products while benefitting development. customers. According to the guidelines, GOVT. FOR NEW LENDING health cover will now come with FORMULA FOR ROAD wellness and preventive measures and PROJECTS: The Government is policyholders can get rewards for working on new norms on lending for adhering to a healthy wellness regime. hybrid-annuity projects after operators The guidelines will allow insurers to suffered losses due to pandemic- reward customers in various ways such induced lockdown. In order to reduce as discounted outpatient consultations risks in road construction projects and or treatments, medicines, health also cushion banks, the Government is checkups and diagnostics, redeemable looking at an average of the marginal vouchers for health supplements and cost of fund based lending rates or also membership in fitness centres and MCLRs of several lenders for such sport clubs. contracts. This would spread the risks SEBI TWEAKS DEFINITION OF in a project over multiple banks as MULTICAP MUTUAL FUNDS: distinct from one bank, which happens SEBI has increased the minimum now. investment threshold in equity and GOVERNMENT ISSUANCE OF equity-related instruments. It is now SOVEREIGN GOLD BONDS: The between 65 and 75% of the Fund’s Government has so far launched six corpus. Further it has mandated that at series of Sovereign Gold Bond (SGB) least 25% of the fund’s corpus should Scheme during 2020-21. SGBs are be deployed in large-caps, mid-caps Government Securities denominated in SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 8
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grams of gold. Investors have to pay the mutual fund products and to energise issue price in cash and the bonds are the distribution network. Now all redeemed in cash on maturity. Investors mutual fund investors including those get interest every year during the 8 year with up to Rs.2 lakh investment will get tenor. Investments in the bonds are at their NAV on the day their money current prices and redemption at the reaches the fund houses. Currently, price trend during maturity. fund houses calculate the NAV for RBI TO INTRODUCE INTEREST investments up to Rs.2 Lakh on the day RATE DERIVATIVES FOR BOTH they receive applications from clients. RETAIL, FOREIGN INVESTORS: However, big investors investing more RBI has proposed to introduce than Rs.2 Lakh have to wait till the exchange traded and over-the counter realisation of the funds to the asset interest rate derivatives products that management companies. The new rule would be accessible to both foreign is applicable from Jan 2021. investors and retail participants. PSBs TO FLOAT COMPANY FOR Foreign portfolio investors would be DOORSTEP BANKING: All 12 allowed to transact in permitted Public Sector Banks (Anchored by exchange-traded interest rate UCO Bank) under the aegis of IBA derivatives for a collective Rs.5000 have joined forces to initially offer 10 Crore in net long positions. Retail non-financial services at customer’s participants can, only use the product doorstep. Now banks are working for hedging while non-retail towards floating a company to house participants can use it for any purpose. the operations of their recently RBI TO GET MORE POWERS TO launched PSB Alliance for Door-step SUPERVISE CO-OP BANKS: The Banking (DSB) initiative. These bill which has been introduced by the services are being offered through DSB Government intends to empower co- Agents at 100 top deposit centres across operative banks to raise equity or the country. IBA is looking to fill the unsecured debt capital from the public position of CEO for the company which subject to RBI approval. Also, it will eventually run PSB Alliance for empowers the RBI to prescribe DSB. DSB services are chargeable with conditions on and qualifications for the current rate being Rs.75 plus GST employment of Chairman of co- per financial/nonfinancial services. operative banks. The RBI may remove GOVT. ISSUES NEW RULE FOR a Chairman not meeting the “fit and IMPORTERS TO GET FTA proper” criteria and appoint a suitable CONCESSION: The Centre has issued person. RBI may supervise the board of new rule for the Importers who need to directors of a co-operative bank after furnish proof of 35% value addition in consultation with the state government. Goods from the Country of Origin to The Bill allows the RBI to undertake claim duty concession under the Free reconstruction or amalgamation of a Trade Agreements (FTA). It has clearly bank without imposing moratorium. . been specified that without furnishing SEBI CHANGES RULES ON MF proof the importers will not get the INVESTMENTS: SEBI has come out concession. The move is aimed at with easy rules for investors of up to plugging duty evasion through routing Rs.2 Lakh to increase the penetration of exports to India under FTAs. The new SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 9
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rule will be a change from the present entity which can trade in relatively ones by which a “Country of Origin” illiquid investment-grade corporate certificate issued by a notified agency bonds and be readily available in times in the country of export is produced by of stress to buy such bonds from the importer who has no additional participants in the secondary market. obligation even though he claims MFs would have to set up such an substantial benefit. entity with enough capital so that it BANK FDs TO CEASE AS would be able to buy illiquid assets in COLLATERALS: Brokers may cease exchange for Government bonds. to accept bank fixed deposits from CENTRE ISSUES SBD FOR clients as margins for stock market PRIVATISATION OF SPD transactions. Clearing Corporations- COMPANIES: The Union Ministry of entities associated with stock exchanges Power has issued a “Standard Bidding to handle confirmation, settlement and Document” (SBD) for the privatisation delivery of all trades-are planning to of the State-owned Power distribution remove FDs from the list of securities (SPD) Companies. This will be the that can be put up as collaterals against guiding document for state trades. Concerns over the legal governments that want to offer their enforceability of liquidating bank FDs Discoms to private companies. This is in the event of non-payment of dues by the first time the Central Government the investors have prompted Clearing has drafted a guiding SBD for Corporations to consider the move. Discoms’ privatisation. It is in line with SUPREME COURT TO TELCOs the Centre’s efforts to improve the ON AGR DUES: According to the operations and finances of state Supreme Court order, telecom Discoms. Last year, the Ministry had operators have to make 10% payment suggested several private franchisee of the total dues as demanded by DOT models to states for the power by March 31, 2021. DOT has already distribution sector. raised demand for full AGR dues. The CAG RAPS CENTRE OVER NON- 10% payment to be made by this march UTILISATION OF CESSES: The will be calculated on total AGR Comptroller and Auditor General liability. Operational telecom operators (CAG) of India has come down on the are expected to pay Rs.12, 921 Crore utilisation of cess collection by the by March 31 of which close to 80% has Centre. The Centre collected over to be paid by Vodafone Idea and Bharti Rs.2.74 lakh Crore through 35 types of Airtel. cesses during FY19. Under the rules, SEBI FOR “BACKSTOP ENTITY” the collection first needs to be TO BUY MF’s ILLIQUID transferred to Reserve Funds and then CORPORATE BONDS: SEBI plans used for the specific purposes as to set up a “Backstop Entity” to buy approved by Parliament. However, only illiquid investment-grade corporate Rs.1.65 Lakh Crore was transferred to bonds from mutual funds in a bid to Reserve Funds and the rest was retained reduce the stress in debt schemes. A in the Consolidated Fund of India backstop will ensure that a part of the (CFI). Funds collected through Central offering is purchased if it goes unsold. taxes along-with cesses and other levies The backstop facility would be an go to the CFI. Here taxes and SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 10
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surcharges are parked in divisible pool SECURITY; RBI has proposed and 42% of the total is given to states Cybersecurity rules based on the size as devolution. and complexity of Urban Cooperative BILATERAL NETTING BILL Banks (UCBs) to bring the largest of PASSED FOR FINANCIAL them on a par with other banks that run SECTOR: The financial sector is a full gamut of protection against online likely to get far more resilient with threats. The UCBs with higher digital Parliament passing the Bilateral Netting depth will now have to appoint a Chief of Qualified Financial Contracts Bill Information Security officer and set 2020 which seeks to help banks various committees. There has to be a optimally utilise capital and increase board-approved IT governance credit limits to enhance liquidity in the framework and considering the economy. The bill primarily aims to implementation to be a costly process. provide an unambiguous legal The responsibility for implementation, framework for enforceability of netting monitoring, compliance and response of a qualified financial contract. Prior would have to be assigned from the to this, India did not have a legal board level and percolate down till the framework for bilateral netting. Netting end-user. enables two counter parties and a GOVT. TO ROLL OUT GST E- bilateral financial contract to offset INVOICING: The Government is claims against each other to determine a operationalising GST e-invoicing from single net payment obligation due from October 1. E-invoicing involves one counter party to others in event of reporting details of specified GST default. documents to a Government notified IBC SUSPENSON GETS portal and obtaining a reference EXTENSION FROM CENTRE: The number. Registered persons will Centre has extended by three months continue to create GST invoices on the suspension of insolvency their own accounting/billing/ERP proceedings initiation against the systems. Initially, it will be mandated corporate debtor for defaults arising for registered persons with a minimum post March 25 when the Covid-19 aggregate turnover of Rs.500 Crore in a induced lockdown was announced. The financial year. These invoices will now first-timeline of six months from March be reported to the Invoice Registration 25 is getting over in September. While Portal (IRP) which will return the e- the Law prohibits insolvency invoice with a unique Invoice proceedings against the corporate Reference Number (IRN) after digitally debtor for defaults occurring during the signing the e-invoice and adding a QR specified period, it does not disallow code. Then the invoice can be issued to such action against the personal the receiver along-with the QR code. A guarantors of a corporate debtor. There GST invoice is valid only with a valid is no prohibition of initiation of IRN. insolvency proceedings on defaults pertaining to debts taken prior to March August 2020 25. GOVT. NOTIFIES E-INVOICING RBI ASKS UCBs TO ADOPT FOR FIRMS: The Government has MORE ROBUST CYBER SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 11
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notified an e-invoicing system under the risk from non-funded FDs as collateral. GST Regime which makes it mandatory By SEBI’s new rule brokers now have for large businesses with turnover of to collect full margins from clients and over Rs.500 Crore to submit sales any short reporting will attract penalties. invoices electronically. When the LISTED PSUs TO ACHIEVE system stabilises then the system will MINIMUM PUBLIC cover with turnover of Rs.100 Crore. SHAREHOLDING NORM: The The system is expected to be rolled out Finance Ministry had notified in 2018 from October1. The system has been that every listed public sector company implemented to track movement of which has public shareholding below goods and track flow of transactions and 25% to increase is public share holding identification of revenue leakages. to at least 25% within a period of two IDR BID ADIEU TO DOMESTIC years from the date of the notification EXCHANGES: Indian depository (August 3,2018). Since many PSUs are receipt (IDR) is a rupee-denominated yet to achieve a minimum public security, listed on domestic bourses, shareholding target and considering the created against the underlying shares of pandemic situation, the Government has an overseas company. IDRs enable extended the deadline by one year more overseas companies to raise funds from to achieve the target. Indian investors. In 2010, the first and GOVT. INCENTIVES UNDER PLI only IDR took off from Standard SCHEME: The Production Linked Chartered Plc. Domestic bourses were Incentive (PLI) Scheme for large scale not able to attract any other company to electronics manufacturing was notified raise funds from India through the IDR by the Government on April 01 and it route. After a decade-long experiment, was open for filing applications till July Standard Chartered Bank decided to 31. The incentives are applicable under delist its IDR from Indian bourses from the scheme from August 01. The June 15. scheme extends an incentive of 4% to SEBI SCRUTINY ON NON- 6% on incremental sales (over base FUNDED FDs AS COLLATERAL: year) of goods under target segment that The use of “Non-funded” fixed deposits are manufactured in India to eligible (FDs) as collateral to get a trading limit companies for a period of five years in equity and commodity markets, has subsequent to the base year (FY2019- come under the scanner of SEBI. SEBI 20). The Government will allow five has asked details of cash collaterals global champions and five domestic from exchanges clearing corporations manufacturers in mobile phones where private banks promise Rs.100 manufacturing to start first under this worth FDs against small deposit scheme. actually deposited by a broker. Banks GOVT. MOVE FOR “ONE NATION call such an arrangement a “Funded ONE CARD PLAN”: The Government Bank Guarantee” and the clearing has enabled the integration of four corporations have extended trading additional states-J&K, Manipur, limits to brokers against it. Banks earn Nagaland and Uttrakhand-to the “One fee on such guarantees. Recently, in the Nation One Card” scheme and with this commodity segment, when crude oil move the scheme has now been enabled prices crashed below Rs.1, SEBI saw in 24 states/UTs. The Government aims SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 12
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to integrate the remaining states/UTs by kitty (Essentially from taxpayer’s March next. With this, about 65 Crores money) since fiscal 2018, the Centre has (80%) of total National Food Security been funding them via recapitalisation Act,2013 (NFSA) scheme population is bonds owing to its weak finances. The now potentially enabled for receiving money raised through issue of recap food grains anywhere in these bonds is pumped in as capital into PSBs states/UTs through national portability (Hence not counted under the fiscal of ration cards. The scheme aims to deficit calculation). ensure the delivery of food security RBI FIRM ON NO BANK LICENCE entitlements to all beneficiaries covered TO INDIA INC: RBI has stuck to its under the Act irrespective of their traditional stand of restricting large physical location anywhere in the corporates from promoting banks. Most country by implementing nation-wide developed countries have moved away portability of ration cards. from the model of banks being owned SEBI TIGHTENS DISCLOSURE or controlled by large business houses, NORMS FOR PROXY ADVISORY especially after 2008-09 global financial FIRMS: SEBI has asked proxy crises. RBI’s main concern is that if advisory firms to disclose the large business houses take a controlling methodologies and processes followed stake in banks, tracking the money trail in the development of their research. and its end-use might become They have also been told to share their challenging. reports with clients and the company GOVT. NOTIIFICATION being reviewed. This sharing policy EXPANDS AMBIT OF AaDHAR should be disclosed by proxy advisors USE: This notification opens up a on their website. The timeline to receive method to use Aadhar for agriculture, comments from the company may be education and health schemes under defined by proxy advisors and all UID can be used for smooth running of comments/clarifications received from schemes through quick identification the company within the timeline shall and weeding out of fakes and duplicates be included as an addendum to the from the system. Aadhar can also be report. Proxy advisors help shareholders used to curtail misuse of Government with data, research and identity cards such as driving licences, recommendations on since an offender can not get a duplicate management/corporate governance once it is linked to the unique identity. issues. Under the new rules, any Government CAG TO GOVT. ON department can link its schemes with RECAPITALISING OF PSU Aadhar to verify or authenticate. BANKS: Comptroller and Auditor RBI ALLOWED BANKS TO General of India (CAG) want to look RESTRUCTURE LOANS: RBI has into the issue of recapitalisation of PSU allowed all financial institutions to Banks. The Auditor wants to know if restructure loans of both companies and the money given to these banks as part individuals without classifying them as of recapitalisation has been utilised NPA as a one-time dispensation to help correctly. In a marked deviation from them to manage the financial stress the past trend, when the Government caused by Covid-19 pandemic. An infused capital into PSU Banks from its expert committee has been formed by SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 13
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RBI which is to be headed by former entitled to a fee corresponding to the ICICI Bank CEO KV Kamath to amount distributed by him. finalise the parameters for the RBI ANNOUNCES MEASURES TO restructuring and suggest ways in which BOOST DIGITAL PAYMENTS: RBI the plan will be implemented. has introduced a slew of measures to RBI ALLOWED SLF OF Rs.10 promote digital payments including a CRORE TO NABARD AND NHB: scheme for offline payments using RBI has allowed additional Special mobile devices and cards and also Liquidity Facility (SLF) of Rs.10 Crore announced a Positive Pay Mechanism to to NABARD and NHB (Rs.5000 Crore prevent frauds with high value cheques. each to NABARD and NHB) at its Under this mechanism, cheques will be policy lending rate. Under this facility, a processed for payment by the drawee small NBFC and micro lenders which bank based on information passed on by extend small sized loans to the poor and its customer at the time of issuance of a housing finance companies focussed on cheque. The Positive Pay Mechanism affordable lending are going to get will cover approximately 20% and 80% liquidity assistance via NABARD and of total cheques issued in the country by the NHB respectively. This is the volume and value respectively. The second support offered to these mechanism will be for all cheques of institutions since the country went into a values of Rs.50, 000 and above. nationwide lockdown in March. While GST RETURNS FORM WITH NABARD got a refinance support of IMPROVED FEATURES FROM Rs.35000 Crore in April and NHB got SEPTEMBER: GST Assessees in the Rs.10000 Crore. country will have an improved form to IBBI ALLOWS REPLACING file returns from September. Also, the LIQUIDATOR DURING VL GST Portal’s capacity to accept returns PROCESS: The Insolvency and would be near-doubled. The capacity to Bankruptcy Board of India (IBBI) has file returns on the GST Portal has been now allowed corporates the flexibility to enhanced to 3 Lakh while the capacity replace its liquidator during Voluntary of the gateway will be 5Lakh at any Liquidation (VL) process. The existing point of time. As regards improvement liquidator can be replaced by appointing in the returns filing mechanism, there another insolvency professional as will be complete linkage of GSTR1, liquidator by a resolution of members or GSTR2B and GSTR3B. This will put a partners or contributories. Previously, complete check on liability mismatch there was no specific regulation for and greater check on input tax credit replacing the liquidator during the mismatch. voluntary liquidation process. IBBI has CBDT ISSUES NORMS FOR also clarified that where a liquidator ALTERNATIVE TAX DISPUTE realises any amount but does not RESOLUTION MECHANISM: distribute the same, he shall be entitled CBDT has issued a comprehensive to a fee corresponding to the amount Mutual Acceptance Procedure (MAP) realised by him. Likewise, where a guidance for the benefit of taxpayers, liquidator distributes any amount, which tax authorities, and treaty partners. The is not realised by him, he shall be guidance comes in the wake of recommendations of report of the Base SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 14
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Erosion and Profit Splitting (BEPS) harvest infrastructure. Under the project of the OECD and G-20 scheme, Rs.1 Lakh Crore will be countries. provided by banks and financial IBBI COMES OUT WITH “RED- institutions as loans with interest FLEG” DOCUMENT: IBBI has come subvention of 3% p.a and credit out with a “Red Flag” document that guarantee coverage for loans up to Rs.2 would serve as a guide to Insolvency Crore. The duration of the scheme will Professional (IP) during the Corporate be 10 years from FY 2020 to FY 2029. Insolvency Resolution Process (CIRP) GOVT. GIVES POWERS TO RBI and help detect if the corporate debtor TO ADMINISTER FDI REGIME: has been subjected to any “avoidance The Central Government has given the transactions”. Insolvency Law frowns powers to RBI through a notification on on alienations of property prior to the July 27, to administer the FDI Regime commencement of the insolvency which includes allowing Central Bank proceedings, if it vitiates the sanctity of to interpret various rules and grant equitable distribution (Pari passu exemptions pertaining to FDI. The rule treatment of the creditors of the same change applies only to foreign direct class) and maximisation of the value of investment which is purchase of shares the assets of a corporate debtor. Such in the secondary market. The change alienations are called avoidance could cut down the processing time for transactions. They vitiate insolvency FDI applications to 5-6 weeks compared proceedings. The IP is duty bound to with 3-4 months currently. file an application with the adjucating SUPREME COURT RULING ON authority seeking claw back of the value HUF PROPERTY: The Supreme lost in avoidance transactions. Court has ruled that a daughter can SEBI ALLOWS MF TRUSTEES TO claim an equal share of parental APPOINT OFFICER TO ASSIST: property. This will be applicable even if SEBI has allowed trustees of mutual the father had died before the funds to appoint a dedicated officer to enforcement of the 2005 amendment to assist them in carrying out their the Hindu Succession Act. The Apex fiduciary duty. The officer should have Court has said that the provisions a professional qualification and contained in the substituted section 6 of minimum of five years experience in the Hindu Succession Act, 1956 confer finance and financial services related the status of coparcener on the daughter field. The officer will be an employee of born before or after the amendment in the trustees and directly report to them. the same manner as a son with same These instructions will be applicable rights and liabilities. from October 1. IBBI GUIDLEINES FOR PM LAUNCHES AGRICULTURE COMPETING BIDDERS IN CIRP: INFRASTRUCTURE FUND: The Insolvency Regulator IBBI has issued Prime Minister has formally launched guidelines for competing bidders in a the recently-announced Rs.1 Lakh Crore Corporate Insolvency Resolution Agriculture Infrastructure Fund. It is Process (CIRP). With the latest change, meant to provide support to farmers, the Committee of Creditors (COP) PACS and agri-entrepreneurs to build would be required to put to vote all community farming assets and post compliant resolution plans SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 15
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simultaneously. The resolution plan that SUPREME COURT RULING ON receives the highest vote, but not less LIMITATION PERIOD IN IBC than 66% of voting share would be CASES: The Supreme Court has ruled considered as approved. that NCLT can not admit applications SEBI MULLS FASTER for Corporate Insolvency Process (CRP) SETTLEMENT FOR STOCK initiations where more than three years TRADES: SEBI is considering a have passed since the date of debt reduction in settlement cycle for default. The Apex Court has confirmed completion of share transactions to T+1- the operation of Law of Limitation over an abbreviation for “Trade plus one IBC proceedings and reaffirmed that day”-from the existing T+2. The move three year time period as prescribed is expected to improve liquidity, boost under the limitation Act for recovery of efficiency and reduce risks to the the debt would apply for admission of system. A T+1 system would mean that corporate insolvency resolution process. trades will be settled the day after the RBI RELEASES FRAMEWORK transaction. So, a buyer would get the FOR RETAIL PAYMENTS: RBI has shares in the Demat account and the released the framework for seller would get the sale proceeds the establishment of a new umbrella entity next day. Currently, trades are settled for retail payments. This entity will be two working days after execution. India tasked with setting up, managing and had moved to the T+2 settlement cycle operating new payment systems in the from T+3 cycle nearly 17 years ago. retail space. It may operate as “for- SEBI had introduced the T+5 system for profit” organisation. The entity formed stocks in July 2001 which was cut to shall be a company incorporated in T+3 in April 2002 and further shortened India under the Companies Act, 2013. to T+2 in April 2003. The entity will have minimum paid-up LABOUR CODES EMPOWER capital of Rs.500 Crore with no single STATES TO CHANGE LAWS: promoter group holding over 40% According to the Labour Code, states investment in the capital. Initially, the will be able to introduce significant promoter should have a minimum of changes to their labour law framework. Rs.50 Crore at the time of submitting such as allowing retrenchment of the application. The promoter/promoter workers, sans a legislative amendment group shareholding may be diluted to a under the proposed labour codes. The minimum of 25% after 5 years of Centre has rejected the key commencement of business of the recommendation of Parliamentary umbrella entity and a minimum net Standing Committee that powers should worth of Rs.300 Crore be maintained at not be given to states. Now, once all times. approved, the Codes will give powers to GOVT. RELAXES WORKING the state governments to notify changes CAPITAL NORMS FOR DISCOMS: to the threshold needed for retrenchment The Government has given Power of workers, hire fixed-term employees, Finance Corporation (PFC) and Rural and weaken the negotiating power of Electrification Corporation (REC) a trade unions while strengthening the one-time relaxation to lend to stressed health facilities for workers at the power distribution companies above the factory premises. limits that were set under the Ujwal SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 16
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Discoms Assurance Yojana (UDAY) by other agencies including IT Scheme. Under this scheme, Discoms Department. The one time settlement were not allowed to borrow from PFC period under the Scheme remains open and REC beyond certain levels. These from August 1 to October 31. SEBI is limits were introduced by the Centre to expected to collect Rs.4000 Crore if a stop Discoms from masking their losses majority of the 14, 000 alleged by increasing liabilities. Now PFC and wrongdoer’s avail of the Scheme. REC will be able to lend to Discoms an RBI TO DISSOLVE BANKING amount more than 25% of the working CODES AND STANDARDS capital of last year’s revenues. BOARD: RBI has decided to dissolve NSFE PITCHES FOR “5C” MODEL the Banking Codes and Standards Board TO MAKE ALL INDIANS of India. The board was set up by RBI FINANCIALLY LITERATE: The in February 2006 as an independent and revised National Strategy for Financial autonomous body, assigned to formulate Education (NSFE) 2020-25 has codes of conduct to be adopted by banks recommended adoption of “5C” model- voluntarily for ensuring fair treatment of Content, Capacity, Community, customers. RBI has since set up CEPD Communication and Collaboration- to (Consumer Education and Protection achieve the financial well-being of all Department), issued the charter of Indians. The NSFE has been put Customer Rights and considerably together by the National Centre for strengthened the Ombudsman Financial Education in consultation with Mechanism to enhance consumer the four regulators –RBI, SEBI, IRDAI protection. CEPD acts as the single and PFRDA and other stakeholders. nodal point for receipt and disposal of NSFE-2020-25 has been released on the all external complaints on deficiency of backdrop of a paradigm shift in digital services by RBI. transactions and payment infrastructure GOVT. TO BANKS ON PERSONAL (Goal of Less Cash Economy) and GUARANTORS TO CORPORATE subsequent to the completion of NSFE- LOANS: The Finance Ministry, to keep 2013-18. a closer eye on personal guarantors of SEBI OFFERS ONE TIME corporate debtors, has directed the SETTLEMENT SCHEME FOR Public Sector Banks to set up a ENTITIES INVOLVED IN ISO mechanism to monitor cases that may MANIPULATION: SEBI on July 27 require initiating individual insolvency had proposed a one time opportunity for process against the guarantors before settlement to the entities allegedly the NCLT. Banks may also consider involved in “Illiquid Stock Options” setting up IT systems to collate the data (ISO) wherein proceedings have been regarding personal guarantors to initiated for executing bogus trades in corporate debtors in all such cases. In the stock options segment between the absence of an IT system and a April 1, 2014 and September 30, 2015. central database, banks were not in a In a bid to evade taxes, they are accused position to effectively monitor cases of of making losses in their trades which personal guarantees although the IBC were later reversed by the counterparties regulations were amended in November the same or next day. The Scheme does 2019 to initiate proceedings against not provide immunity from prosecution personal guarantors. SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 17
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RBI TO DEFER DEADLINE FOR BANKS ON the investors purchasing shares at discounted CAPITAL BUFFER: The transition to full prices in reconstruction schemes including Yes Capital Conservation Buffer (CCB) of 2.5% by Bank Ltd. Reconstruction Scheme and other banks was to be completed by March 31, 2019. resolution plans approved by NCLT will not But the RBI deferred implementation of the last face income tax. CBDT has notified changes to tranche to March 31, 2020. Considering the relevant sections to enable this, which will also potential stress on account of Covid-19, RBI exempt transactions by residents receiving had deferred the implementation of the last property in un-regularised colonies in NCT tranche of 0.625% of CCB from March 31, Delhi which are now regularised. The 2020 to September 30, 2020. If CCB is not transactions are based on the latest power of deferred, it will go up to 2.5% from October 1, attorney, agreement to sale, will, possession 2020 from the current 1.875% now, letter and other documents. necessitating banks to raise capital. Including GOVT. FLOATS SLS TRUST TO BAIL CCB, the total capital ratio of a bank will go up OUT NBFCs, HFCs: The Centre has approved to 11.5% from October 1 due to the increase in a Special Liquidity Scheme for purchasing CCB against 10. 875% now. Hence, RBI may short term debt up to Rs. 30, 000 Crore from again defer the implementation of the last stressed NBFCs, HFCs. SBI’s subsidiary tranche of CCB by banks. SBICAP has set up a SPV –a Special Liquidity Scheme (SLS) trust to purchase short term July 2020 papers from eligible NBFCs and HFCs who have repayment liabilities of Rs.65, 000-Rs.75, NEW STAMP DUTY TO HIT MUTUAL 000 Crore between July and Sept. of this year. FUND INDUSTRY: The uniform stamp duty There is fear that some stressed NBFCs may of 0.005% on mutual fund investments which default on their liabilities which could pose comes into effect from July 1, 2020 will turn Systemic Risks to the entire financial sector. To out to be an entry load and double tax on the avoid such situation the SPV will purchase industry. The mutual fund industry which is investment-grade commercial papers and non- essentially a pass-through vehicle, was never convertible debentures with a residual maturity levied any tax on investment till date. The of not more than three months. The facility will Govt. introduced changes to the Stamp Duty not be available for any paper issued after Sept Act last year by introducing a uniform rate of 30, 2020. The SPV will cease to make fresh stamp duty on trading of shares and purchases after this date and will recover all commodities which were earlier being charged dues by December 31, 2020. at different rates in each state. The tax will have RBI TO HAVE REGULATORY a major impact on short term mutual fund CONTROL ON CO-OP BANKS IN schemes such as overnight and liquid funds, PHASED MANNER: Union Govt. will notify compared to long-term investment in equity. the recently promulgated Ordinance to give GOVT. EXTENDS PMGKAY SCHEME: more powers to RBI on Co-cop banks in phased Govt. announced extending PM Garib Kalyan manner. The new Ordinance has been made Anna Yojana (PMGKAY) Scheme till effective from June 29 to cover multi-state co- November which was initially valid for 3 operative banks. However, a large majority of months till June 30. Under the scheme, 80 co-operative banks that operate in one state or Crore individuals will continue to get 5 kg of state co-operative bank will be covered under wheat or rice a month free till November. This the new law from a later date for which will be over and above the subsidised notification will be issued. The new Ordinance foodgrains being made available under the enables the RBI to take control over Public Distribution System. Also, each poor management of Co-operative banks registered household will get 1Kg of pulses per month with the state government apart from multi- free. The extension will cost over Rs.90, 000 state Co-operative banks. Crore and if initial three months expenditure is GOVT. EASES ELIGIBILITY NORMS included the total spend comes out to Rs.1.50 FOR FPIs: In Sept last year, SEBI had Lakh Crore. reclassified registration categories of FPIs into CBDT NOTIIFES ON IT UNDER Category I and Category II with strict and RESOLUTION PLANS: CBDT has said that SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 18
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increased threshold of eligibility norms made hereafter, the buyer will have to pay penal applicable for Category-I participants including interest @1% per month for delayed payment. sovereign funds, pension funds, regulated Under general finance rules, buyers are entities like offshore banks. Centre has eased required to make payment within 10 calendar eligibility criteria for investment funds set up days of generation of CRAC. by category-I FPIs to avail tax benefits INDIA TO SEE TRADE SURPLUS AFTER retrospectively from Sept 23, 2019. These 18 YEARS: India may register its first monthly Funds do not need to adhere to certain trade surplus in over 18 years in June as the conditions-having min 25 members, none pace of contraction of exports is estimated to having more than 10% participating interest have slowed down to around 12% while and aggregate participating interest of 10 imports are seen to have fallen almost 49% members not exceeding 50%- to benefit from during the month. Initial estimate for June show India’s special taxation regime. a trade surplus of around $786 million with SEBI FOR RATINGS ON NON- imports pegged at $21.1 Billion and exports at COOPERATING COMPANIES: The $21.9 Billion. The last time India had a positive number of companies refusing to share balance on the trade account was in January information with Credit Rating Agencies has 2002 when it had a surplus of $10 million. increased sharply. The percentage of companies GOVT. GUIDELINES FOR CONTRACT into the “Non-cooperative category” has more FARMING: According to the Govt. than doubled from 22% in FY 2018 to 47% in guidelines, farmers entering into contract FY 2020. SEBI had directed the Rating farming agreement with food processors and Agencies in January to downgrade an other firms will have liability limited to the instrument to “Non-investment Grade” with advance that they receive or the cost of farm issuer-non-cooperating status, if all outstanding services provided by the sponsoring firm. Also, ratings of the issuer remain non-cooperative for the sponsor under no circumstances can gain more than 6 months. From July 1, Raters are ownership rights over the farmers’ land. The supposed to downgrade issuers who have been sponsor would be responsible for any loss or non-cooperative since January. damage to the farm produce. Farmers, on the IBBI MULLS CAP ON NO. OF other hand, can not use the inputs provided by ASSIGNMENTS BY IPs: The Insolvency the sponsor for anything other than growing the Regulator IBBI proposes to limit the maximum produce agreed upon. The farming agreement number of assignments handled by an should be for a minimum of one cropping Insolvency Professional (IP) under the season to a maximum of five years. The corporate insolvency resolution process and contract can be beyond five years only if a liquidation process to 5 at a given point of time. single production cycle of the crop is more than For corporate debtors having turnover less than five years. Sponsor has to give reasons for Rs.1000 Crore, Cap has been proposed 5. In rejecting produce. Farmers can insist on 3rd case of turnover ranging from Rs.1000 Crore to party verification of rejected produce. Rs.5000 Crore, limit has been proposed at 4. In GOVT. TO PERMIT IBA TO SET UP BAD case of companies with turnover exceeding BANK: The Centre is likely to tell the Indian Rs.10, 000 Crore the maximum number of Banks’ Association (IBA) to set up its proposed assignments for an IP has been pegged at 2 and “Bad Bank” with financial support from banks the limit will be one if turnover exceeds Rs.50, instead of asking the Government to become a 000 Crore. promoter. If the banks want they can set up FINMIN RULES FOR PAYMENT TO through their own funds. IBA had proposed a VENDORS ON GeM: Finance Ministry has National-level Asset Reconstruction Company decided to levy interest on late payments to (ARC) owned by the Government with its vendors on the Govt. e-Marketplace (GeM). capital infusion worth Rs.10, 000 Crore. This This has been done to discipline and timeliness would have allowed the Bad Bank to take up in payment to vendors, especially MSMEs. stressed loans from banks worth Rs.70, 000 Whenever a Consignee Receipt and Acceptance Crore. The IBA wanted the Government to Certificate (CRAC) is auto-generated or issued invest and control the ARC to give some level by a buyer and payment is not made 10 days of comfort to the lenders because the present
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ARC mechanism in the market has not shown privately funded highways on the Build- expected results. Operate-Transfer (BOT) model that includes a GOVT. MAKES CHANGES IN APY revenue protection to traffic risks. Currently, SCHEME: The Centre has made certain revenue assessment is done after 10 years or changes in the Atal Pension Yojana (APY). once in the life cycle of the project. Now the Presently, while the APY is primarily focussed assessment will be done after every five years. on workers in the unorganised sector, it is open The work order for building highway project to all citizens of India and those between 18-40 will be issued only when 90% of the land is years of age can enrol. The scheme seeks to acquired and this will form a part of the provide fixed monthly pension of Rs.1000- condition precedent. Rs.5000 depending on their monthly CBDT’S NEW TOOL FOR TDS ON contributions from the age of 60 years. The HEAVY CASH WITHDRAWALS: CBDT changes include the auto debit facility for has announced a new tool for banks and post contributions towards the APY from July. offices to ensure tax deduction at source (TDS) Secondly, APY subscribers can upgrade or on cash withdrawals beyond a certain downgrade the desired pension amount any threshold. Any non-filer of income tax returns time during the year. is subject to TDS if he/she withdraws Rs.20 GOVT. NOT TO MERGE THREE PSU lakh or more in a financial year. The TDS rate INSURERS: The proposal for merger of three will be 2% (of withdrawn amount over Rs.20 state-owned insurances firms – National lakh). This rate will go up to 5% if the Insurance, Oriental Insurance and United India withdrawal is more than Rs.1 Crore. Here too, Insurance – was announced by then Finance TDS will be applicable on the amount over Minister in his budget speech in February 2018. Rs.1 Crore. This system comes into effect from Now the Centre has decided not to merge the 3 July 1. insurers but the Union Cabinet has approved SEBI FOR CORPORATE BONDS TO Rs.12, 450 Crore capital infusion in them and TRADE LIKE STOCKS AND G-SECS.: the focus will be on their profitable growth. SEBI has decided to develop the Bond Market. LANDMARK RULING OF HIGH COURT SEBI wants that the Corporate Bonds should be ON MORATORIUM: Karnataka High Court traded on exchange platforms like the same has delivered a landmark ruling on Moratorium way stocks and Government Securities (G- in the case of Velankani Information Systems Secs) are traded for a wider set of such Ltd. The Apex Court said that all businesses are securities. NSE and BSE operate corporate entitled to loan moratorium if it is a question of bond platforms but those are merely systems their survival. All borrowers are eligible to seek for reporting corporate bond deals. SEBI is a moratorium. If a borrower were to seek for looking to create a platform that automatically grant of a moratorium on the ground that does order matching similar to stocks and continuity of its business would be affected and Government Securities. Most of the trades in establish the same, the borrower would as a the corporate bond market are decided on the matter of right be entitled to the grant of phone. SEBI wants to ensure guaranteed moratorium so that such continuity is not settlement of trades and streamline the process adversely affected. The Court also asked RBI to of trade execution and settlement. An automatic verify if lending institutions have Board order-driven system and seamless settlement approved moratorium policies and set up an will bring in transparency and liquidity to effective grievance redress forum for market. complaints. Further the court also said that AIR INDIA INTRODUCES “LEAVE when multiple banks are involved in a loan WITHOUT PAY” SCHEME: Air India has transaction, one bank can not deny extension of approved a “Leave without Pay” Scheme for its the moratorium facility if others are willing to employees for six months to two years which extend the benefit. can be extended to five years. The Scheme has PANEL APPROVES MODEL come into effect immediately. The scheme is AGREEMENT FOR BOT: An Inter- applicable on a voluntary basis or can be Ministerial Group has approved the Model availed of for personal reasons. Currently, the concession agreement used for building Airline’s salary bill stands at Rs.250 Crore a
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month. No employee making use of the scheme Rs.2 Crore. This subvention will be available will be permitted to take up a job in other for a maximum period of seven years. For loans public sector undertakings. Employees can, above Rs.2 Crore, the subvention will be however, avail of medical/ passage benefits as limited to Rs.2 Crore. per company rules during their period of leave SEBI FOR STOCK EXCHANGES TO without pay. MOVE INTO REAL-TIME NITI AaYOG MANDATES 25% SETTLEMENT: SEBI has proposed to the RECYCLED PRODUCTS IN INFRA stock exchanges to gradually move towards PROJECTS: Niti Aayog mandates the use of real-time settlement of trades in the share recycled materials up to 25% in large market. Exchanges, through the use of block infrastructure projects in line with the global chain should try real time settlement in the move to promote the use of secondary products. stock markets. They should go for at least on a Currently, secondary products hardly find place pilot or trial basis. The markets have come a in large infrastructure projects because of a long way from 45 days of settlement to the strong presence of primary products which are current position. As of now, settlement of trade available for the same price as secondary in India’s stock markets is done on a T+2 basis. products. Recycled materials do not lose any According to the brokers, the T+2 settlements physical or chemical properties and compete system encourages intraday trading but real- with primary products. Using recycled products time settlement would most likely mean by up to 25% may reduce raw material cost of immediate payment of cash and delivery of the project by at least 10-15%. shares. IT DEPARTMENT FOR FACELESS WAGE SETTLEMENT OF BANK STAFF ASSESMENT: The Finance Ministry had SETTLED BETWEEN IBA AND UNITED launched faceless assessment last October in a FORUM ; According to the MOU between move that tax assessments should be IBA and the United Forum of bank unions anonymous thereby eliminating discretion and representing workmen unions and officers physical interface. Under this mechanism cases association 15% Wage Hike has become are assigned randomly using algorithms and effective from November 2017 to October kept away from the geographical jurisdiction of 2022. Wage-hike has become “Performance- the case. The identity of the assessing officers linked pay for PSB staff” for the first time. This remains unknown to the taxpayers. A total of a departure from the past practice of setting a 58, 319 cases were picked up in the first phase fixed salary hike based on bilateral of faceless assessment process out of which negotiations. Banks with increase in operating 7116 cases have been disposed off. Thus the profit of less than 5% will get no additional faceless assessment system has been a game- pay. All employees will get an additional pay changer in the arena of Direct Taxation. It has of 5-15 days of basic and DA component of empowered taxpayers and altered the facets and their salary per year based on the profitability perception of overall tax administration in levels. Banks reporting an increase in operating India. profit of 5-10% will give additional salary of 5 CENTRE ISSUES NORMS FOR AIF days, 10-15% 10 days and above 15% 15 days. SCHEME: Govt. issued guidelines for The banks’ contribution to the National Pension financing under the recently announced Rs.1 System Fund will be increased to 14% from lakh Crore Agriculture Infrastructure Fund 10% subject to approval by the Government. (AIF) Scheme that seeks to facilitate creation and strengthening of post-harvest management and marketing infrastructure across the country. Disbursements will be made in the first four years- Rs.10, 000 Crore in the current fiscal and Rs.30, 000 Crore each over the next three years. The moratorium for repayment under the scheme may vary from six months to two years. All loans under the scheme will have an interest subvention of 3% per annum up to a limit of
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year period but could be extended by another year as per notification. GOVT. AMENDS ACCOUNTING STANDARDS ON RENTALS: The Government has amended the accounting FREE HEALTHCARE FOR MIGRANT standards to provide relief to companies that WORKERS UNDER AYUSHMAN received concessions on their rentals after BHARAT: The Centre had launched Covid-19 outbreak. Changes to the Indian Ayushman Bharat Scheme in September 2018 Accounting Standards (Ind-AS) will allow which provides a cover of up to Rs.5 Lakh per companies to show the benefit in their profit family per year. The Centre had in June and loss (P&L) account. The move comes as a extended the flagship scheme to migrant huge relief for airlines and retail chains which workers across states, in the wake of the have many assets or properties on hire. Until lockdown and travel restrictions imposed. now, if any terms and conditions of an existing Migrants were identified based on e-cards. lease contract changed then it would have to be National Health Authority (NHA) has launched treated as a new lease contract. This means that a campaign “Swasthya Ki Chaanv, Shehar ho if a company got a rental concession for one ya Gaanv” to reach out to migrants and educate year in a ten-year contract the benefit would and empower them to make use of the free have to be reworked to reflect its present value healthcare services under the scheme. Covid-19 which would be lower than the current value. treatment is also covered under the scheme. The latest amendment does away with the need SEBI’S NEW MARGIN NORMS IN CASH for such recalculations and the benefit can be MARKET TO START IN AUGUST: SEBI’s taken into the P&L account for the current new margin norm in the cash market is to kick- period. in from August 1. In the cash market, traders GOVT. RELAXES PENSION RULES and investors will have to maintain 100% UNDER COVID: The Department of Pension upfront margin to buy or sell stocks. This had created a Portal which could be accessed means that NIL or short collection of margin by any Government Employee approaching will attract penalty. This rule will coincide with superannuation to find out the status of his or “non-considering power of attorney” for her pension papers. Due to the disruption to the collection of margin which is also being official work due to the pandemic and implemented from the same date. On an lockdown, some of the employees who had average, cash equities witness trades in excess retired during this period, may not have of Rs.30, 000 Crore daily and retail investors provided with PPO. In order to avoid a delay in largely do not pay any upfront margin for this. the start of regular pension covered under From August 1, that would change as money Pension Rules 1972, the rules have been will have to be paid in advance to brokers to relaxed to enable seamless payment of not only buy but even sell shares. “Provisional Pension” and “Provisional SBI TO RECRUIT RETIRED EMPLOYEES: Gratuity” till the regular PPO is issued. This State Bank of India has opened its door again to facility will initially continue for a period of six former employees for different roles. The months from the date of retirement and the recruitment is being conducted by the Local period of provisional pension may be further Head Offices (LHO) or Circles of the Bank extended up to one year in exceptional cases. depending on their respective human resource UNION CABINET APPROVES NEW requirements. Though the process of hiring NATIONAL EDUCATION POLICY: Union retired employees started in Delhi Circle a Cabinet has approved New National Education couple of months ago, the same model is being Policy. The 10+2 structure of school curricula adopted now by other SBI Circles. Those up to is to be replaced by a 5+3+3+4 curricular 63 years of age who served as scale-I to Scale- structure corresponding to ages 3+ 8, 8-11, 11- V officers and retired at 60 are eligible to 14 and 14-18 years respectively. This will bring apply. Those who had opted for voluntary the hitherto uncovered age group of 3-6 years retirement or been dismissed from service are under the school curriculum which has been not eligible. The appointment will be for a one recognised globally as the crucial stage for the
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development of the mental faculties of a child. restrained YES Bank from paying interest The new system will have 12 years of (Coupon) on Upper Tier-II Bonds as its capital schooling with three years of anganwadi/ pre- adequacy ratio is below regulatory schooling. The Policy emphasises mother requirements. The Bank had approached the tongue /local/regional language as the medium RBI seeking approval to pay interest due as on of instruction at least till Class V, but June 29 for upper-Tier-II bonds. These preferably till class-VIII. Sanskrit is proposed unsecured non-convertible bonds carry coupon to be offered at all levels of school and higher of 10.25%. Its overall capital adequacy ratio education as an option, including in the three- stood at 8.5% at the end of March below the language formula. The report card will be regulatory requirement of 11.5% with common comprehensive report on skills and capabilities equity tier-I of 6.3%. In this behalf, bank’s instead of just marks. shareholders approved raising capital of up to Rs.15, 000 Crore to enhance capital adequacy ratio, support growth and create buffers. SEBI ISSUES FRAMEWORK FOR DEFAULTED DEBT SECURIITIES: SEBI has allowed transactions in defaulted debt securities and put in place operational framework for such transactions. The framework has come after the redemption amount has not been paid on maturity or redemption date. With regard to default in payment of redemption amount and resumption of transaction on defaulted debt securities, SEBI said that within two working days from the date of intimation from issuer or debenture trustees that issuer has defaulted on its payment obligations, the depositories in coordination with exchanges will update the ISIN master file SUPREME COURT RULING ON FARM- and lift restrictions on transactions in such debt LAND THROUGH WILL: (Case- Vinod securities. Further, information regarding Chandra VS. State of Gujarat) Transfer of resumption of transactions will be disseminated agricultural land for commercial purposes is a immediately on the websites of both controversial subject. Supreme Court has ruled depositories and stock exchanges. that under the Bombay Tenancy Act, such transfer is not allowed through a Will. Even SEBI EASES PRICING RULES FOR otherwise, such transfer requires permission PREFERENTIAL ISSUES: SEBI has relaxed from an authorised officer. If such transfer is pricing norms for preferential issuances to ease permitted through testamentary disposition, it capital-raising process for listed companies. would defeat the purpose of the Act. The earlier guidelines required the issue price to be the average of the last 2 weeks or the last RBI TO BANKS OVER “RED-FLAGGED” 26 weeks whichever was higher. The new ACCOUNTS: According to the RBI directive, pricing formula will be a volume weighted once an account is “Red-flagged”, banks are average of weekly highs and lows for 12 weeks mandated to complete its forensic audit within or two weeks whoever is higher. SEBI, said six months and decide whether it is fraudulent that the shares issued under the new pricing or not. Classifying loans as fraud would mean a norms will be locked in for three years and the jump in provisions and impact the bottom-line pricing relaxation will be valid for issuances of banks in June quarter. This would belie until Dec 2020. market expectations that bad loan provisions would not spike in April-June quarter because IBM LAUNCHES FREE DIGITAL of moratorium on repayments allowed because LEARNING PLATFORM: IBM has launched of Covid-19. “Skills Build Regnite” to provide job seekers and entrepreneurs with access to free online RBI RESTRAINED YES BANK PAYING coursework and mentoring support, designed to INTEREST ON TIER-II BONDS: RBI has SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 23
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help them reinvent their careers and businesses. losses. SEBI would permit a two-month window According to the India Skill Report 2019, only for trades in these securities on the stock 45.6% of youth graduating from educational exchanges. This will be the first time the SEBI is institutions are employable. This reflects the permitting existing NCDs to be listed. massive shortage of skilled workforce in the FOREIGN BANKS TO OFFLOAD INDIA country. Any individual with learning LOANS: Foreign Banks with large exposure to aspirations can tap into host of industry Indian corporates may be forced to sell their loans relevant content including Artificial after Moody’s downgraded India’s Sovereign Intelligence, Cloud, data analytics and security rating to the lowest Investment grade. Most to re-skill and up-skill themselves at no cost. foreign banks follow the sovereign ceiling policy practised by all major rating agencies which means that if there is downward revision of JUNE 2020 sovereign rating, the credit rating of corporate YES BANK SENIORS TO HAVE CTC AS debt issuers of the country will fall in tandem, VARIABLE PAY: Yes Bank has restructured the irrespective of the issuer’s financial rating. In salaries of senior leadership team for the current such situation, they typically reduce their financial year by moving up to 30% of their total exposure by exiting or part selling their loan cost to company (CTC) to variable pay category. portfolios. The Leadership Team has taken a voluntary SEBI FOR EASIER FUNDRAISING FOR ALL decision for restructuring of their compensation Cos VIA PREFERENTIAL ROUTE: SEBI is package. Earlier the compensation on CTC basis considering a relaxation in pricing rules to make was fixed at 100%. As per RBI guidelines, the it easier for all companies to raise capital by variable pay could be in the form of share-linked making preferential equity sale to financial and instruments or a mix of cash and share-linked strategic investors in the wake of the Covid-19 instruments. The entire variable pay can be in that has impacted stock prices and earnings. SEBI cash only in cases where rules and regulations do is to make the preferential allotment regulation not permit share-linked instruments. At Yes more realistic not just for stressed companies but Bank, the bonus-performance linked to any listed entity which is struggling in the compensation was outside of CTC. present environment despite a viable business GDP, CPI BASE YEAR REVISION PROCESS model. DERAILED: The recession forecast caused by UNION CABINET APPROVES “ONE INDIA- the covid-19 pandemic has derailed the ONE AGRI-MKT ORDINANCE: Union Cabinet Government’s plan to carry out the consumer approved 3 ordinances intended to create “One expenditure survey in 2020-21. Base year revision India-One Agriculture Market”. The 1st one process is recommended on a 5 year basis to keep enables farmers to sell their produce outside up with the structural changes in spending regulated mandis. There will be no restrictions on patterns; but it should be a normal economic year. inter-state and intra-state trade. 2nd provides an The Government had earlier decided to revise the agreement on price assurance that the farmers can base year from 2011-12 to 2017-18. If the survey engage with processors, aggregators, wholesalers, is conducted in 2021-22 or 2022-23, the base year large retailers and exporters through contract on revision would finally happen much after 2025- pre-agreed prices. It will eliminate intermediaries 26, an over 15-year gap in revision. Former chief resulting in full realisation of price. Under 3rd statistician of India Pronab Sen, heads the Ordinance, cereals, pulses, oilseeds, edible oils, committee to improve quality of Indian Statistics. onion and potatoes will be removed from list of SEBI FOR ONE-TIME LISTING WINDOW Essential Commodities. There will be freedom to FOR UNLISTED NCDs: SEBI is considering an hold, move, distribute and supply will lead unprecedented one-time listing window for harnessing of economies of scale. existing unlisted non-convertible debentures to GOVT. TIGHTENS IMPLEMENTATION OF ease stress at various mutual funds. Such funds NEW SCHEMES: Union Finance Ministry has holding illiquid, lower-rated securities would be put the brakes on the implementation of new able to use this opportunity to offload them to schemes other than those announced in the Rs.20 buyers. The rise in risk aversion after Covid-19 Trillion package to revive the economy and help lockdown had made it very difficult for funds to vulnerable sections amid the Covid-19 crisis. sell these securities without incurring heavy New schemes up to Rs.500 Crore which were SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 24
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given in-principle approval would also be having four mega-public sector banks through suspended in the current FY. The Ministry has mergers or privatisation. already given interim approval for continuation of SUPREME COURT RULING ON LIABILITY: the existing schemes for 2020-21. However, this (case- Telengana Power Distribution Co. VS. would be subject to the assessment of the Srigdhaa Beverages) In this case a unit of a resource position of the exchequer after the mineral water bottling company was sold through acceptance of the recommendations of the 15th auction by invoking the Securitisation Act as the Finance Commission later this year. owner could not repay a loan given by Syndicate RBI SETS UP FUND TO BOOST E- Bank. The distribution company demanded the PAYMENTS: RBI has set up a Payment dues of the defaulting company from the new Infrastructure Development Fund (PIDF) with a buyer, leading to litigation. Supreme Court ruled corpus of Rs.500 Crore, with an aim to give a that the liability to pay electricity dues of the push to digital payments nationwide. RBI has previous owner falls on the auction purchaser if made an initial contribution of Rs.250 Crore the terms of the sale recites “As is where is, what covering half the fund. The remaining will come is there is and without any recourse basis’ as per from the card-issuing banks and card networks Security Interest (Enforcement) Rules. operating in the country. This fund has been SUPREME COURT RULING ON GRATUATY created to encourage acquires to deploy Point of OF CHARGED OFFICER: (Case- Mahanadi Sale infrastructure, both physical and digital in Coalfields VS. Rabindranath) In this case the the tier-3 to tier-6 centres and north-eastern states. Supreme Court has ruled that an Employer has This is in line with the measures proposed by the the right to withhold the gratuity of an employee Vision Document on Payment and Settlement during the pendency of the disciplinary action Systems in India 2019-21. even if he has retired. Further, the employer has GOVT. ISSUES ORDINANCE ON IBC: Govt. can impose the penalty of dismissal even if he has has notified an Ordinance to suspend insolvency attained the age of superannuation. proceedings for up to one year against fresh GOVT. CONSIDERING NEW CLASS OF default from March 25. The move will potentially FUND FOR STRESSED ASSETS: The Govt. is provide breather to thousands of firms battered by considering a new category of Alternate Covid-19 Pandemic crisis. Hence, no application Investment Fund which will focus on acquiring for initiation of corporate insolvency resolution stressed assets from banks and shadow lenders, a process of a corporate debtor shall be filed for any move aimed at resolving some of the highest bad default arising on or after March 25, 2020 for a debt in the world. The Fund will be allowed to period of 6 months or such further period not buy stressed assets directly from the banks and exceeding one year from such date. However, non-banking financial companies. At present, insolvency applications filed for default before investors can only access bad loans through March 25 will be entertained. securities issued by asset reconstruction SEBI ISSUES REGULATORY SAND BOX companies but the new fund category will allow FRAMEWORK: SEBI has released guidelines for them to do so directly. the regulatory sandbox, enabling entities RBI ISSUES DRAFT FRAMEWORK FOR regulated by SEBI to test their new solutions in a SECURITISATION OF STANDARD ASSETS: live environment and on a limited set of real RBI has released a draft framework for the customers with necessary safeguards. securitisation of standard assets, proposing an CENTRE TO DESIGNATE BANKING AS easing of minimum holding requirements for STARATEGIC SECTOR: The Centre is likely to mortgage-backed securities and a modification in designate the banking as strategic sector under the the definition of the term “securitisation” to apply new privatisation policy. According to the new it to single-asset transaction as well. Only privatisation policy, announced by the Union transactions that result in multiple trenches of Finance Minister as part of the “Atmnirbhar securities being issued reflecting different credit Bharat” package, the Govt. will come up with a risks will be treated as securitisation transactions list of strategic sectors. In each strategic sector, and accordingly covered under the guidelines. For no more than four state-owned companies will residential mortgages against which Mortgage- exist. After the latest round of consolidation of backed Securities (RMBS) will be issued by the public sector banks, there are currently 12 public Special Purpose Entity, the minimum holding sector banks. The long term plan will involve period (MHP) applicable will be six months or SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 25
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period covering six instalments whichever is later. GSTR3B or summary returns in the case of NIL The Minimum Retention Requirements (MRR) on liability, whereas in cases of tax liability, late fees RMBS for the originator shall be 5% of book has been capped at Rs.500 per return for the value of the loans being securitised. period between July 2017 and January 2020. RBI ISSUES FRAMEWORK FOR SALE OF Further interest rate has been halved to 9% for LOAN EXPOSURES: RBI has issued draft late filing of returns for small companies for comprehensive framework for sale of loan supplies made between Feb and April. exposures. The lenders can sell stressed assets FIRST NATURAL GAS EXCHANGE TO only on cash basis. The entire sale consideration START: Indian Gas Exchange (IGX) the should be received upfront and the asset can be Country’s First Natural Gas Exchange will start taken out of the books of the transferor only on operations. IGX, set up by the Indian Energy receipt of the entire sale consideration. RBI said Exchange (IEX) will offer option of both just that the lenders shall hold purchased stressed buying the product as well as purchase along-with assets on their books for at least 12 months before delivery. The delivered transactions will require selling it to other party. The regulator has ensuring pipeline availability with operators. Spot mandated assigning 100% risk weight for NPA contract for the day-ahead market gas will be acquisition if the acquirer is classifying it as delivered the next day. Additionally, there will be “Standard Asset” in its books. The purchasing forward contracts too, that will be daily, weekly, lenders shall adjust recoveries in respect of an monthly and fortnightly markets. The Exchange is NPA purchased from other lenders against its coming up without any regulatory framework in acquisition cost only. Thereafter, recoveries in place. Currently, neither Govt. nor the Petroleum excess of acquisition cost can be recognised as and Natural Gas Regulatory Board have any profit. regulations for LNG. SEBI RULING ON PROMOTER’S KIN: Owner GOVT. FOR NO LEGAL ACTION OVER of Red Tape, a Brand of Shoes, sought guidance DATA GAPS: Govt. will not invoke a legal from SEBI whether married daughters of MD / provision that empowers it to penalise the Promoter, holding > 10% of the voting rights in companies refusing to submit data for key the listed company but living separate lives with statistics such as Index of Industrial Production. no involvement in the firm’s management, can be The country’s statistics body did not release reclassified from the promoter group to the public headline numbers for Index of Industrial category. SEBI has held that a promoter’s kin can Production (IIP) for April and Consumer Price not be re-categorised as public shareholder even if Index (CPI) for April and May when India was in they live independent lives or uninvolved in lockdown due to the spread of Covid-19 affairs of the company. pandemic. As per the Collection of Statistics Act, SEBI MAKING BOARD OF DIRECTORS 2008, whoever refuses to supply the data ACCOUNTABLE: SEBI is making the Board of particulars for statistical purposes is punishable Directors accountable for investment decisions with a fine of up to Rs.1000 or in the case of a taken by Alternative Investment Funds (AIFs) company, with a fine of Rs.5000. that hire external advisors and are often a INSOLVENCY REGULATOR FOR NO BAR preferred choice of wealthy foreign and local ON INVOKING INSOLVENCY AGAINST investors betting on Indian businesses. The Board GUARANTOR: As per latest Ordinance, of Fund’s Asset Management Company typically insolvency proceedings was suspended for 1 year delegates the investment powers to an investment against fresh default from March 25. Insolvency committee. SEBI has made it clear that if there Regulator clarified that it does not stop creditors are external third parties in the investment from initiating bankruptcy process against a committee, the board of directors and senior personal guarantor to a corporate debtor. SBI employees would be responsible for the recently took Anil Ambani to the NCLT for investment and not the committee. personal guarantee given on loans worth over GST COMPLIANCE NORMS FOR SMALL BIZ Rs.1200 Crore to Reliance Communications. EASED: GST Council has eased the compliance RBI EASES TARGETS FOR WLA FIRMS: RBI burden for small businesses by slashing late fees has relaxed the deployment norms for White- and halving the interest rate on them. In order to Label ATM (WLA) Firms, who will now not clean up pendency in return filing, the council need to put up thousands of units every year. RBI decided to waive late fees for not furnishing is for manageable annual targets, a major SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 26
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departure from the stiff run rates set under the other restrictions will continue for another six licence terms in 2012. Deployment by WLA months. firms has been poor at 23, 597 units, 7 years after SEBI EASES NORMS FOR BROKERS: SEBI they began operations. As many as 200, 000 has extended the deadline for brokers to submit WLATMs would have been deployed if the run reports on client funding and daily margin till rate had been maintained. July 31 in the wake of covid-19 crises. Besides, SEBI EASES PREFERENTIAL ALLOTMENT, SEBI has given more time for submitting QIP NORMS: SEBI has eased the capital raising compliance certificate on margin trading, risk- norms for listed companies to tide over the based supervision, internal audit report as well as liquidity crisis created by the Covid-19 pandemic. net worth certificates of brokers for half year SEBI has amended the takeover code to allow ended March 31, 2020. The imposition of penalty promoters to acquire up to 10% in a FY without was effective from April 1, and the relaxation in triggering an open offer. However, such an this regard was given till June 2020. Reporting of acquisition can be done only through the non-collection/ short collection of margins in the preferential issue of equity shares. Promoters will cash segment shall continue. have to infuse fresh capital into their company CO-OP BANKS TO COME UNDER RBI and not simply acquire shares from the secondary SUPERVISION: The Union Government has market. SEBI has also relaxed the norms for decided to take the Ordinance Route to give more qualified institutional placements (QIP). The powers to RBI to supervise co-operative banks Regulator has eased the mandatory 6-month akin to commercial banks. In February, the cooling-off period between two QIPs to just two Government had said that the audit of such co- weeks. operative banks will be in accordance with the RBI TIGHTENS RULES FOR HOUSING RBI regulations and the best management FINANCE LENDING: RBI has proposed a host practices laid down by the Regulator will also of changes to the rules that govern housing apply to them. RBI will get powers to supersede finance companies (HFCs). These include the board of Co-operative Banks. doubling the net-owned funds to Rs.20 Crore, at least 75% of half of HFCs’ net assets should be individual housing loans and proposed that no prepayment penalty should be levied for floating rate loans. The changes have been initiated as HFCs came under direct supervision of RBI in early August 2019 from National Housing Bank. RBI draft rules also said that non-deposit taking HFCs with asset size of Rs.500 Crore and above and all deposit-taking HFCs irrespective of their asset size will be treated as “Systematically Important HFCs”. FINMIN ASKS BANKS TO CUT NON- ESSENTIAL EXPENSES: The Finance Ministry has asked public sector banks to cut non-core business expenses by 20% and instructed lenders to avoid incurring non-essential expenditure like SUPREME COURT RULING ON FARM- purchase of staff cars, refurbishment of guest LAND THROUGH WILL: (Case- Vinod houses or spend on interior decoration items. Chandra VS. State of Gujarat) Transfer of agricultural land for commercial purposes is a RBI ALLOWS WITHDRAWAL LIMIT IN PMC controversial subject. Supreme Court has ruled BANK: RBI had imposed restrictions on the Bank that under the Bombay Tenancy Act, such on September 23, 2019 after it found that 75% of transfer is not allowed through a Will. Even the loans were fraudulently given to HDIL Group otherwise, such transfer requires permission from which subsequently went bad. Now RBI has an authorised officer. If such transfer is permitted allowed that the depositors can withdraw up to through testamentary disposition, it would defeat Rs.1 Lakh from their bank accounts enhancing the purpose of the Act. the limit which was earlier Rs.50, 000. However,
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RBI TO BANKS OVER “RED-FLAGGED” formula will be a volume weighted average of ACCOUNTS: According to the RBI directive, weekly highs and lows for 12 weeks or two weeks once an account is “Red-flagged”, banks are whoever is higher. SEBI, said that the shares mandated to complete its forensic audit within six issued under the new pricing norms will be months and decide whether it is fraudulent or not. locked in for three years and the pricing Classifying loans as fraud would mean a jump in relaxation will be valid for issuances until Dec provisions and impact the bottom-line of banks in 2020. June quarter. This would belie market IBM LAUNCHES FREE DIGITAL LEARNING expectations that bad loan provisions would not PLATFORM: IBM has launched “Skills Build spike in April-June quarter because of Regnite” to provide job seekers and entrepreneurs moratorium on repayments allowed because of with access to free online coursework and Covid-19. mentoring support, designed to help them RBI RESTRAINED YES BANK PAYING reinvent their careers and businesses. According INTEREST ON TIER-II BONDS: RBI has to the India Skill Report 2019, only 45.6% of restrained YES Bank from paying interest youth graduating from educational institutions are (Coupon) on Upper Tier-II Bonds as its capital employable. This reflects the massive shortage of adequacy ratio is below regulatory requirements. skilled workforce in the country. Any individual The Bank had approached the RBI seeking with learning aspirations can tap into host of approval to pay interest due as on June 29 for industry relevant content including Artificial upper-Tier-II bonds. These unsecured non- Intelligence, Cloud, data analytics and security to convertible bonds carry coupon of 10.25%. Its re-skill and up-skill themselves at no cost. overall capital adequacy ratio stood at 8.5% at the end of March below the regulatory requirement of May 2020 11.5% with common equity tier-I of 6.3%. In this MSME SCHEME NORMS RELAXED FOR behalf, bank’s shareholders approved raising PROJECT CLEARANCE: Under the PMEGP capital of up to Rs.15, 000 Crore to enhance scheme, loans up to Rs.25 lakh are given for capital adequacy ratio, support growth and create manufacturing and service industries in which buffers. subsidy is provided by KVIC. So far, such SEBI ISSUES FRAMEWORK FOR proposals were scrutinised by the District Level DEFAULTED DEBT SECURIITIES: SEBI has Task Force. Since the District Collector is often allowed transactions in defaulted debt securities inundated with administrative duties, there was and put in place operational framework for such considerable delay in sanctioning of the projects. transactions. The framework has come after the Hence, Ministry of MSME has done away with redemption amount has not been paid on maturity district level approval system and eased up the or redemption date. With regard to default in procedure for the scheme that helps fund payment of redemption amount and resumption of enterprises in rural and semi rural areas. transaction on defaulted debt securities, SEBI said INDIA OFFERS LAND TO COMPANIES that within two working days from the date of LEAVING CHINA: India is developing a land intimation from issuer or debenture trustees that pool nearly double the size of Luxemburg to lure issuer has defaulted on its payment obligations, businesses moving out of China. Land has been the depositories in coordination with exchanges one of the biggest impediments for companies will update the ISIN master file and lift looking to invest in India. The Centre is working restrictions on transactions in such debt securities. with the State governments to change this Further, information regarding resumption of scenario as investors seek to reduce reliance on transactions will be disseminated immediately on China as manufacturing base in the aftermath of the websites of both depositories and stock the coronavirus outbreak and the resultant supply exchanges. disruption. A total are of 461, 589 hectare has SEBI EASES PRICING RULES FOR been identified across the country for the purpose. PREFERENTIAL ISSUES: SEBI has relaxed SEBI ON EASING QIP PRICING NORMS: pricing norms for preferential issuances to ease Pricing norms for Qualified Institutional capital-raising process for listed companies. The Placements (QIP) mandate that the issue price in earlier guidelines required the issue price to be QIP to be not less than the average of weekly the average of the last 2 weeks or the last 26 high and low for two weeks preceding the weeks whichever was higher. The new pricing SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 28
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relevant date. A further discount of up to 5% on not to treat delayed or skipped payments as the floor price can be offered to investors. defaults between March and May period. Investment bankers asked SEBI to allow GOVT. HIKES STATE GOVT. BORROWING companies to offer a 10% discount on the floor LIMIT: The Centre acceded to a demand from price as cash strapped firms are struggling to raise States that their market borrowing limit be money due to earnings uncertainty. But SEBI enhanced. The Union Finance Minister has raised feels that share prices were already trading at the net borrowing limit for state governments lower levels and so the Regulator has rejected the from 3% of the Gross State Domestic Product proposal of the investors. (GSDP) to 5% to make available an additional SUPREME COURT RULING ON CO-OP Rs.4.28 Lakh Crore to all states combined. While BANKS: In a landmark ruling, a Supreme Court 0.5 percentage points (pps) of the extra borrowing five-judge Constitution bench has ruled that the window will be available to all states Co-operative Banks can use the Securitisation and unconditionally, one percentage point will be Reconstruction of Financial Assets and made available in four equal tranches with each to Enforcement of Security Interest Act (SARFESI clearly “specified, measurable and feasible reform Act) for recovery of debts from defaulters and can actions. The balance 0.5 pps can be accessed if size and sell their assets to recover their dues. milestones are completely achieved in at least INDIA TO CONSIDER TAX RELIEF ON three out of four areas-Universalisation of “One FORCED RESIDENCY DUE TO LOCKDOWN: Nation One Ration Card” , ease of doing As per provisions applicable up to FY20 any business, power distribution and augmentation of individual who stays in India for 182 days or urban local body revenues. more in a financial year or 60 days or more in a IT LIABILITY IN CASE OF SALARY financial year and at least 365 days in the past PAYMENT DEFERMENT: If a company defers four years is a tax resident in India. His or her an employee’s salary or a vendor’s payment say global income becomes taxable in India as well. by six months, tax is applicable on such salaries The Finance Act 2020 amended the Income Tax or payments under current taxation laws since it is Act in which Indian citizens or persons of India a promise of income in future. As companies origin who have India-sourced income exceeding defer salaries to staff and payments to suppliers Rs.15 Lakh will be regarded as Indian Tax and vendors due to cash flow constraints because residents in a financial year if their stay is 120 of the Covid-19 pandemic and resultant days or more and at least 365 days in the past four lockdown, it is clear that deferring the expense financial years. India has been under lockdown does not mean that tax too can be postponed. As since March 25 and stopped international flights per current tax regulations, companies will have even before that. India may provide relief to to provide for any deferral under Section 192 of individuals who have technically become resident the Income tax Act in their books and tax will in the country because they have been forced to have to be deducted on that. extend their stay due to lockdown. SEBI EASES NORMS ON FINANCIAL GOVT. TO RAISE GROSS MARKET REULTS OF BANKS: SEBI has exempted banks BORROWING TARGET: The Government has and insurance companies from publishing raised its gross market borrowing target for the consolidated financial results for the June quarter current financial year to Rs.12 Lakh Crore from in the wake of Covid-19 pandemic. At present, Rs.7.8 Lakh Crore estimated in the budget, listed companies having subsidiaries are required attributing the over 50% increase in the to submit quarterly or year-to-date consolidated borrowing to the Covid-19 pandemic. The higher financial results. Besides, Ind-AS is applicable to borrowing is possible due to a combination of all listed entities, barring those in the banking and lower taxes and more fiscal stimulus to support insurance sectors. SEBI has also eased norms on the economy. requirement of dividend warrants and cheques. PFRDA TO OFFER MORATORIUM ON NCD Currently, rules allow issuance of “payable at PAYMENTS: PFRDA plans to offer companies a par” warrants or cheques in case it is not possible three-month moratorium on interest and principal to use electronic modes of payment. In case the payments on bonds and debentures held by amount payable is more than Rs.1500, the Pension Funds in line with the bank and market cheques should be sent by speed post. The regulators offering moratorium on loan and bond requirement of this regulation will apply upon payments. Pension Fund Managers will be asked normalisation of postal services. SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 29
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IBA PROPOSES GOVT-OWNED BAD BANK: Secretary a party respondent in all cases related to The concept of Bad Bank was first floated by the Insolvency and Bankruptcy Code (IBC). Sunil Mehta, PNB CMD in 2018 which came out NCLT had said in the order that the order would with project Sashakt. Now IBA has proposed a be applicable throughout the country to all the Bad Bank which would have a two-tier structure NCLT benches. NCLAT objected to the order and where the Government would own 100% of said that the order is beyond the power of the reconstruction company with an investment of Tribunal and it tantamount to imposition of a new Rs.10, 500 Crore. Banks may shift up to Rs.70, rule in a compelling fashion. 000 Crore of bad loans at a value net off the LIC LAUNCHES PENSION SCHEME FOR regulator-determined provisions and would SENIOR CITIZENS: LIC of India has started review the stressed accounts post the lifting of selling the Pradhan Mantri Vaya Vandana Yojana moratorium and could decide to shift more assets for senior citizens aged 60 years and above. This with additional capital from the government. The pension scheme is non-linked and non- plan involves setting up of an Asset Management participating and will be available for investors Company with Rs.100 Crore as capital with till March 31, 2023. This scheme has a policy participation from all banks and a reconstruction term of 10 years and the pensioners can choose company with a potential to buy as much as monthly, quarterly, half-yearly and yearly mode Rs.70, 000 Crore of bad loans. The reconstruction of pension. The scheme will provide an assured firm will have a tenor of 10 years. rate of return of 7.40% per annum in FY 21. For GOVT. GIVES RELIEF TO MSMEs IN investors investing this financial year will get INSOLVENCY PROCEEDINGS: In a big relief 7.40% per annum payable monthly for entire to cash-starved firms, the Government said that duration of ten years. insolvency proceedings against fresh defaulters GOVT. TO WITHDRAW RBI BONDS would remain suspended for up to one year and SCHEME: The Government has decided to Cocid-19 related debt would be excluded from the withdraw 7.75% savings (Taxable) Bond Scheme definition of default. Initially, proceedings under due to declining interest rates. The Scheme, the IBC can not be invoked for six months which commonly known as RBI Bonds or GOI Bonds is can be extended by another six months depending popular among retail investors who looking for on the pandemic situation. Further in a bid to safety of principal and regular income. NRIs, insulate small businesses from being dragged to however, are not eligible for making investments NCLT the default threshold for triggering in these bonds. As per the scheme, the bonds are insolvency has been raised to Rs.1 Crore from repayable on the expiration of seven years from Rs.1 Lakh. Further Union Finance Minister said the date of issue. The interest rates on bank fixed that the suspension on fresh initiation of deposits as well as lending rates are on decline insolvency proceedings for one year is likely to with RBI lowering the Key repo rate. The Repo increase provisioning for banks. rate is currently at historic low of 4%. Hence the SEBI ISSUES LISTING NORMS FOR MF Government has notified withdrawal of this SCHEMES: SEBI has issued the guidelines for Bonds Scheme form May 28th. listing of Mutual Fund (MF) schemes which are in the process of winding up, wherein the AMC, February 2020 its Sponsor, employees and trustees will not be CBDT NOD TO SEVEN ELECTRONIC allowed to transact in such units. This comes after MODES: The Central Board of Direct Taxes Franklin Templeton Mutual Fund closed six of its (CBDT) has included 7 new electronic modes that debt schemes citing redemption pressures and will be accepted for making non-cash payments. lack of liquidity in the bond markets. Under the These modes include payments using- Debit norms, such units can be listed and traded on a Card, Credit Card, Net Banking, IMPS, UPI, recognised stock exchange which may provide an RTGS and BHIM. These modes can be utilised exit route to investors. for making payments and availing various NCLAT SETS ASIDE NCLT ORDER IN IBC benefits and relief under the Income Tax Act MATTERS: The National Company Law 1962. Till now, the accepted payment channels Appellate Tribunal (NCLAT) has quashed the for payment were Account Payee Cheque, November 22 order of the National Company Demand Draft and ECS which could be used Law Tribunal (NCLT) that sought to implead the under various Income Tax Provisions instead of Ministry of Corporate Affairs (MCA) through its SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 30
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cash. This is an enabling Rule introduced in the reclassified as a private sector bank last year. Income Tax Law which will significantly Loss-making IDBI Bank has been picked as the encourage businesses to accept payments through first public sector bank in which the Government contemporary electronic modes of payments and will divest its entire ownership. Last year LIC promote the Government’s initiative of “Digital acquired a 51% stake in IDBI Bank following India”. which the Government now owns 47% stake. The GOVT. TO DILUTE ITS STAKE IN LIC OF Government now plans to sell its remaining INDIA: Union Budget proposed an IPO for LIC equity in the secondary market. of India through which the Govt. will dilute its RBI TO BANKS TO SET UP CELLS TO stake in it. Finance Minister assured 30 Crore MONITOR LVC EXPOSURES: RBI is likely policyholders of LIC that their interests would be to ask banks to set up dedicated cells for market protected when the Government dilutes its stake. intelligence and monitoring Large Value Credit They are bringing an Initial Public Offering (IPO) (LVC) exposures. This is expected to address of LIC and not selling it completely. There will issues relating to large divergences observed in be no change in the ownership. It has also been asset classification and provisioning in bank’s assured that the LIC policies will not lose their credit portfolios vis-a-vis RBI’s supervisory “Sovereign Guarantee”. assessment and the rising incidence of frauds. CAPITAL INFUSION BY GOVT. FOR PSU RBI may also direct banks to leverage data GENERAL INSURERS: While State-run Banks analytics more to monitor credit exposures. did not get any allocation for capital infusion, the GOVT. TO USE E-BIDDING PLATFORM budget set aside Rs.6950 Crore for FOR DISINVESTMENT: The Government is recapitalisation of the three Public Sector General ready with an Electronic Bidding System to make Insurance Companies- National Insurance, public sector strategic sale process more Oriental Insurance and United India Insurance transparent and will do away with paper bids that which are to be merged. The Centre had have been the norm. The Platform which has been previously infused Rs.2500 Crore in the three developed by state-run MSTC will allow suitors insurers through the first supplementary demand for state-run companies to not just submit bids for grants for 2019-20 in December last year. online but will encrypt them so that even the According to the Rating Agency ICRA, “The transaction advisors and government officials recapitalisation capital outlay for the public sector dealing with the sale can not access them. The insurance companies would be credit positive for latest platform has already been tested and is the 3 companies (All are undercapitalised). based on the recommendations of the independent IMMUNITY SCHEME FOR DIRECT TAX external monitoring group comprising former DISPUTES: The Government has introduced an Chief Justice RC Lahoti, former CAG VK Immunity Scheme –”Vivvad se Vishwas” for 5 Shunglu and former Chief Vigilance months till June 30, 2020 for citizens to settle Commissioner. disputes on income tax, offering relief from a MERGED BANKS TO GAIN FROM TAX: “Vexatious litigation process”. Under the The Union Budget has allowed carry forward of proposed scheme, one is required to pay only the losses and depreciation for state-run banks and amount of the disputed tax. By doing so, the general insurance companies that are being person will get complete waiver of interest and merged, a move that would substantially reduce penalty provided the payment is made by March tax outgo of recently merged state-run banks. 31, 2020. For a disputed penalty, where interest Banks are allowed to carry forward depreciation and fee are not connected with the disputed tax, and net loss in their books for up to 8 years and one is required to pay only 25% of this total for use them to offset their future profits and pay settling the dispute. If repaying after March 31, lower tax. However, as per the current one shall be required to pay 110% of the disputed regulations, in the event of a merger they can not tax. take either depreciation or loss on the books of GOVT. TO DIVEST ITS ENTIRE the merged entity. OWNERSHIP IN IDBI BANK: IDBI was itself MCA NOTIFICATION ON MAJORITY classified as a development financial institution SHAREHOLDERS TO BUY MINORITY (DFI) and converted into a bank only in 2004. STAKE: According to a February 3 notification With LIC buying the majority stake, it was by the Ministry of Corporate Affairs (MCA)
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majority shareholders planning to buy minority the board of multi-state Co-operative Banks. investors from an unlisted public or private Currently, there are 1540 Co-operative Banks. company will now have to deposit 50% of the RBI TO LAUNCH DIGITAL PAYMENTS acquisition price in a separate bank account. The INDEX: RBI would launch in July a Digital notification also stipulated that shareholders with Payments Index (DPI) to capture the extent of a 75% stake can now make an offer to buy out the digitisation of payments in the country. The DPI remaining shareholders holding 25%. Prior to the would be based on multiple parameters and shall February 3 notification, rules provided that reflect accurately the penetration and deepening shareholders with a 90% stake could buy out the of various digital payment modes. The Index will remaining 10% stake. Majority shareholders help the regulator to understand the impact and through special resolution always had an ability to spread of digital payments in rural, urban and cause reduction of capital and achieve squeeze- semi-urban areas as well as understanding the out of minority shareholders. impact of policy decisions made by it. COs TO PAY STIFF PENALTY FOR SEBI ISSUES NORMS FOR AIF FAKING EXPENSES: The Government has BENCHMARKING: SEBI has issued the said that the fake bills to lower profits and evade guidelines for benchmarking the performance of tax through artificial expenses will attract a stiff Alternative Investment Funds (AIFs) with a view penalty from the next financial year. Companies to streamlining disclosure standards and helping caught with false entries in their account books investors in assessing scheme performance. will have to cough up a penalty as high as the Benchmarking will apply to all schemes that have total value of the invoice –over and above the completed at least one year from the date of “First amount of tax it will have to pay. The penalty will Close”. Funds incorporated overseas with India now be 100% of the aggregate of the amount of track record shall also provide the data to such false or omitted entry and not the tax agencies when they seek registration as AIFs. evaded, as per old provisions. Now the law has a Performance benchmarking shall be done on a new provision primarily targeted at bogus half-yearly basis based on data as on September purchases, capital gains or expenses. 30 and March 31 of each year. SBI PLANS EVALUATION METRICS FOR WhatsApp PAY GETS APPROVAL FROM OFFICERS: SBI has decided to link grant of NPCI: Facebook-owned messaging service extension for officers to evaluation metrics WhatsApp has secured regulatory approval for comprising parameters such as performance, launching its digital payment platform- attitude and credentials, compliance and integrity, “WhatsApp Pay” –in a phased manner, around conduct and benchmark-qualifying score. The two years after a small-scale pilot run. The cases of officers for the purpose of grant of National Payments Corporation of India (NPCI) extension in service or otherwise will be reviewed granted permission to the company to operate the in two stages under the evaluation metrics: First platform that would cater to 10 million users in Stage on completion of 30 years of India in the first phase. The NPCI’s approval service/pensionable service or on attaining 55 followed the RBI’s go-ahead. WhatsApp assured years of age, whichever occurs first. (For grant of RBI and NPCI that it would comply with data extension in service up to 58 years of age). localisation norms. Second stage will be on attaining 58 years of age SBI’s NEW ATMs TO HOLD/DISPENSE for grant of extension/ continuation in service up NOTES OF ANY DIMENSION: SBI wants to to 60 years of age, being the age of retirement. ensure that its new ATMs, which will be installed CABINET NOD TO AMEND BR ACT ON under the fully outsourced model, are equipped CO-OP BANKS: The Cabinet has given its nod with adjustable cassettes that can hold and to amend the Banking Regulation (BR) Act so as dispense currency notes of any dimension. To to put certain co-operative banks under the minimise disputes between customers and the regulatory ambit of RBI. Under the proposed bank, the new ATMs will have a camera at the amendments, co-operative banks will need to take cash slot to capture the movement of cash from the RBI approval for the appointment of CEO. the presenter belt and final withdrawal by the Besides, such co-operatives banks will also come customer. Besides enabling the usual under the RBI’s supervision in terms of audit. transactions, such as cash withdrawal, balance The Regulator will also have power to supersede enquiry, mini-statement, PIN change and cheque
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book request, SBI wants its ATMs to provide organisation operating retail payments and value-added services. settlement systems in India. As many as 56 INDIAN MNCs TO PAY TAX ON PRE- member banks are shareholders in NPCI. Now NEGOTIATED INCOME: The Government NPCI’s reign as the sole umbrella organisation has allowed the Multi National Companies could come to an end with RBI allowing private (MNCs) having a permanent establishment (PE) entities to apply for a licence to set up rival in India to enter into Advance Pricing umbrella entities. RBI said that entities keen on Agreements (APA) with the Income Tax setting up a pan-India New Umbrella Entity Authorities and they can negotiate how much of (NUE) for retail payments system can incorporate the margin on profits accrued in India would be a company in India under the Companies Act, taxed for having PE in India. Until now, such an 2013. The NUE should have a minimum paid-up arrangement was possible only in transfer-pricing capital of Rs.500 Crore. matters. The new provision will allow about 3500 CBDT FOR SHARING INFORMATION TO foreign firms and 1400 PEs to access APAs or a SEBI FOR FRAUD PROBE: CBDT, which safe harbour regime in which they can pre-decide frames policy for the tax department, has issued the income for at least nine years (Including the an order in this context on Feb 10, 2020. The rollback of four years) and accordingly pay tax. Income Tax Department will share all taxpayers’ At present, the rate of tax on PEs is 43% data, such as PAN information with SEBI in order including cess and surcharge, while subsidiaries to help the Market Regulator in its probe against of MNCs come under the corporate tax structure. various entities including those involved in stock SUPREME COURT RULING ON INCIDENT market manipulation. The sharing of information INFORMATION: (Gurshinder Singh VS. will be under three broad heads- Request-based Shriram General Insurance) In this case the Exchange of Data, Suo Moto and lastly person whose tractor was stolen had lodged a Automatic. complaint with police but the vehicle could not be SUPREME COURT DIRECTION TO traced. He filed a claim but the insurer rejected POLITICAL PARTIES ON “CRIMINALS”: the claim due to delay of 52 days. The District The Supreme Court has directed the political Consumer Forum and the National Consumer parties to upload on their respective websites and Commission also rejected the case on the same social media platforms the details of pending ground. The Party then appealed the Supreme criminal cases against candidates contesting on Court which held and ruled as follows- “When their party symbols, the reasons for selecting the party had lodged the FIR immediately after them and for not giving a ticket to those without the theft and when the police after investigation criminal antecedents. The Apex Court further said have lodged a final report that the vehicle was not that these details should be published within 48 traced and when the surveyors/ investigators hours of the selection of the candidate or at least appointed by the company have found the claim two weeks before the first date for filing of of the theft to be genuine, mere delay in nominations whichever is earlier. intimating the insurance company can not be a PMO TO BANKS ON NPA CASES TO BE ground to deny the claim”. REFERRED TO NCLT: Banks find it safer IRDAI REVISES NORMS FOR INSURERS option to refer all bad loan cases to NCLT as they TO MONITOR INVESTEE FIRMS: IRDAI fear that resolutions through one time settlement has issued revised set of stewardship guidelines or sale to an Asset Reconstruction Company for insurance companies to closely monitor the could invite scrutiny from investigative agencies. companies they invest in, intervene if required As a result, most banks especially public sector and also compulsorily vote if they own more than banks, are using NCLT as an escape route rather a specified amount of equity in the firm. Insurers than a tool to empower and keep companies have been asked to have a clear policy on voting running. In view of such type of situation, the and disclosure of voting activity every quarter. Prime Minister’s Office (PMO) has suggested to Revised guidelines focus more on voting banks that they should refer cases to a Tribunal activities. where the loan amount is at least Rs.200 Crore. NPCI’S MONOPOLY IN PAYMNETS AND This is aimed at declogging the overburdened SETTLEMENT TO END: Currently, National NCLT ecosystem. Where the loan amount is less Payments Corporation of India (NPCI) is the sole than Rs.200 Crore, the PMO wants banks to work
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with the current promoters to find long term GOVT. REVAMPS CROP COVER SCHEME solution to prevent closure of companies and job PMFBY: The Government has announced that it losses. would reduce its share in premium subsidy for the IRDAI TO SET UP COMMON flagship crop insurance scheme –PM Fasal Bima ELECTRONIC PLATFORM: IRDAI plans to Yojana (PMFBY)-to 30% and 25% respectively set up a Common Electronic Platform for settling for un-irrigated and irrigated crops from the health insurance claims. The idea to form this existing 50% for major states, even as it made the platform is that all are there on a single platform- crop protection cover voluntary for farmers. Insurer, Insured and Hospital- and the claims will Further the central share in the premium subsidy be processed on this platform. This will give a would be increased to 90% for the north-eastern rich wealth of data apart from standardising states. settlement and ensuring that settlements are done · RBI TO PUSH NEW ACCOUNTING within a specified period in time. The Regulator NORMS TO FY 23: RBI could push the has already formed a committee for this purpose implementation of Ind-AS –the Indian version of and the platform will be developed by the global accounting standards to fiscal 2023 in view Insurance Information Bureau. of poor preparedness of banks to make the transition. The new rules are expected to add to NHAI TO ADOPT PROJECT-BASED the burden of higher capital requirements for FUNDING MODEL FOR FUTURE banks especially loan-loss provisions. It is PROJECTS: National Highway Authority of estimated that PSU banks would require an India plans to adopt a project based funding additional Rs.1.1 lakh Crore to immediately model for future projects to reduce debt. They adhere to the accounting rules if implemented. will convert each project into a Special Purpose Further the proposed merger of public sector Vehicle (SPV). The funds will be arranged by that banks is expected to create more complications on company. They have a list of 22 expressways and the calculations of expected loss accounting. So, access-controlled highways where they plan to it is practical if this implementation is pushed for implement this model. According to the proposal, a few years. every project would have an SPV seed funded by · CBIC TO ROLL OUT FACELESS NHAI to the tune of 30% equity and remaining ASSESMENT: After completion of pilot 70% would be sourced through debt which would projects, the Central Board of Indirect Taxes and be serviced by SPV from the toll revenue. Customs (CBIC) have decided to introduce faceless assessment. This is expected to bring SEBI ISSUES TIGHTER NORMS FOR anonymity in assessment and reduce the physical INVESTMENT ADVISORS: SEBI has issued interface between the Assessing Officer and the the tighter norms for Investment Advisors. SEBI Importer/ Broker to a large extent. Each National has barred use of titles like independent “financial Assistant Commissionerates (NAC) will have an advisors” by those dealing in distribution of all India jurisdiction and it would consist of a securities unless they are registered as investment cluster of “Faceless Assessment Groups” (FAGs). advisors also. The Regulator requires investment The FAGs will be legally empowered to advisors and distributers of financial products to undertake assessment pertaining to any customs segregate their services. Distributers of financial location in India. products will no longer be able to act as · GOVT. CONSIDERING UNLISTED investment advisors to the same clients. COMPANIES TO LIST ABROAD: The SUPREME COURT RULING ON Government is considering an amendment to the PERMANENT COMMISSION FOR Companies Act to allow Indian Companies to list WOMEN IN ARMY: The Supreme Court ruled abroad without having to register themselves on and ordered the Government to grant permanent the domestic exchanges. Currently, Indian service to women officers in the Army’s non- companies tap foreign capital mostly through combat support units on par with their male American Depository Receipts or Global Depository Receipts. Infosys was the First Indian counterparts, should they wish to continue with it Information Technology Company to be listed on after completing their short service commission. Nosdaq, one of the two major stock exchanges in Denial of such an opportunity combined with the the US. Companies prefer foreign listing since Army Policy of not giving them command posts investors are more credible in these platforms. It of (Colonel and beyond based on performance gives them more liquidity to their stock. index) lowered their status to that of a jawan/JCO.
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· SUPREME COURT RULING ON BOUNCED brokers will have to be specifically marked CHEQUE: (Case- Aps Forex Services VS. “Shares pledged for the purpose of margin”. So Shakti International Fashion Linkers) In this case far, the practice did not require any such specific on the issue of “Burden of Proof” in bounced pledge and merely shares lying in clients’ Demat cheques, the Supreme Court reiterated that once accounts held by brokers were considered for the the issuance of the cheque and the signature on it purpose of margin. Transfer of securities to the have been admitted, there is always a Demat account of the trading member /clearing presumption that it was issued to satisfy a legally member for margin purposes, shall be prohibited. enforceable debt or liability. However, this · GOVT. NOTIFIES POLICY FOR FDI IN presumption can be rebutted by the drawer by INSURANCE: The Department of Promotion of leading evidence as prescribed under section 139 Industry and Internal Trade (DPITT) has of the Negotiable Instruments Act. amended the FDI Policy 2017 to allow 100% FDI · FIRST AaDHAR AUTHENTICATED in Insurance Intermediaries through the automatic FARMERS’ DATABASE LAUNCH: The route. Till now FDI up to 49% was allowed in Government will launch first of its kind Aadhar- insurance intermediaries through the automatic authenticated digital database of farmers in June. route. However, as far as insurance companies are This will be used as a master database for concerned, foreign investment of up to 49% is implementing any farmer-related government allowed through the automatic routes subject to schemes. The database will be a consolidation of the approval of the Insurance Regulator. Further all kinds of genuine lists of farmers available with the ownership and control of the firms must the Government. The database will be launched remain with resident Indian entities. with 60 million farmers and their landholdings · SEBI TO MUTUAL FUNDS FOR will also be mapped. Presently the Government is LIQUIDITY BUFFER: SEBI has exhorted the having database of more than 9 Crore (90 Mutual Fund Industry to build an adequate Million) farmers out of which 84% are now “Liquidity Buffer” for debt schemes to be better Aadhar-authenticated. This is an ongoing process prepared in the event of a crises. SEBI has also and it is being updated. asked the mutual funds to participate more in the · GOVT. NOTIFICATION FOR voting process of company resolutions rather than RESTORATION OF FULL PENSION: The abstain from it. The industry has also been Labour Ministry has notified the restoration of warned against miss-sell credit risk funds –which full pension after 15 years of retirement for invest more than 65% of their corpus in lower- pensioners who have commuted part of their rated bonds –to investors by assuring them pension at the time of retirement. The move is unrealistic returns. expected to benefit 630, 000pensioners and substantially increase pensions for those members January 2020 of the EPFO who retired before September 26; 2008.and had opted for partial commutation of SEBI ALLOWS TRADING IN OPTIONS ON pension. The higher or full pension benefit will be COMMODITIES: SEBI has allowed the Stock restored after 15 years from the date of receiving Exchanges to start trading in options on goods commuted pension at the time of retirement. which could potentially bring down the risk of · RBI TO BANKS ON EXTERNAL trading in commodities like gold, silver, rubber BENCHMARK: RBI has asked that all new and garments. This will allow traders to take floating rate loans to Medium Enterprises delivery of goods on which they buy options. Till extended by banks from April1 will have to be now, futures on commodities were allowed and linked to an external benchmark. This move is to options’ trading was limited to contracts on those further strengthen the monetary policy futures, while direct trading in options contracts transmission. Banks can link the loans to one of on commodities were not allowed. the four external benchmarks- RBI’s Policy Repo PANEL TO VET BANK FRAUDS BEFORE Rate, Govt. of India three month treasury bill PROBE AGNECIES: All big cases of suspected yield, Six month treasury bill yield, and any other banking frauds will have to be vetted by a Panel benchmark market interest rate published by the before banks ask agencies such as CBI to initiate Financial benchmarks India Pvt. Ltd. action. Such step is a framework designed to · SEBI UNVEILS NEW MARGIN PROCESS: allow bankers to take decisions without fear. The SEBI has now set a new process for brokers to “Advisory Board on Banks and Financial Frauds” take shares as margin from clients. From June 1, has been set up by the CVC to examine shares of clients lying in Demat accounts of complaints against bankers. The five member board will function as the first level of SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 35
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examination for all alleged cases of fraud investment in derivatives and not indulge in involving Rs.50 Crore or above and official of the speculative transactions that are not accompanied rank of General Manager and above. by actual delivery. GOVT. MAKES EASIER FOR PENSIONERS SEBI ISSUES NEW FRAMEWORK ON TO SUBMIT LIFE CERTIFICATES: To avoid LISTING GUIDELINES: SEBI has issued the discontinuation of pension due to pensioners’ stricter mechanism to deal with non-compliance inability to submit a life certificate by November of listed conditions under which stock exchanges 30 every year, the Department of Pension and will have powers to slap penalties of up to Rs.50, Pensioners’ Welfare has asked the disbursing 000 for certain violations. At present, a stock banks to send the pensioners reminders via SMS/ exchange is allowed to charge a maximum e-Mail four times before the stipulated date and amount of Rs.10, 000 for each violation of listing also ask them if they would like to avail of a norms that need to be complied with by doorstep service. The pension disbursing banks companies. The bourses can levy a fine of have been asked to send SMS/ e-Mails to the Rs.25000 each in cases of non-disclosure of pensioners on October 24, November 1, dividend distribution policy in annual reports and November 15 and November 25 every year on the websites of the entities. reminding them to submit the annual life GOVT. TO COME OUT WITH NATIONAL certificate by the stipulated date. BUSINESS REGISTER: Govt. will come out SUPREME COURT RULING ON BANK with a National Statistical Business Register that NEGLIGENCE: (Case- DAV Public School VS. will have data on all business enterprises in the Indian Bank) The bank accounts of the School country based on the results of the ongoing 7th were without net banking facility. But when the Economic census. The register will list district- principal opened a savings net banking account wise all business enterprises and establishments for transferring funds to the three school engaged in production of distribution of goods or accounts, it was found that Rs.25 Lakh was services and it will be updated regularly using unauthorisedly transferred from the school data from other official data-bases such as GSTN. accounts. Moreover it was found that a duplicate The data collected is expected to help improve the SIM card was used to transfer money. On appeal, quality of national accounts and provide input for the Supreme Court said that the bank linked the the proposed annual survey of services. school accounts to that of the principal without RBI DOUBLES FPIs’ DEBT INVESTMENT any request from the school. Therefore, neither LIMIT: In a bid to attract more investment in the school nor the principal was responsible for Government and Corporate debt, RBI has doubled the loss but the bank should compensate the loss the investment cap for Foreign Portfolio Investors to the school. (FPI) under the “Voluntary Retention Route” GOVT. APPOINTS CHIEFS OF THREE (VRR) to Rs.1.5 Lakh Crore. The VRR was PSBs: The Government has announced the introduced in March 2019 to enable FPIs invest in appointment of Lingam Venkata Prabhakar as debt. These limits will be available “on tap” and MD&CEO of Canara Bank, Sanjiv Chaddha as allotted on “First come first served” basis. The MD& CEO of Bank of Baroda and Atanu Kumar new VRR scheme also allows FPIs to invest in Dass as MD&CEO of Bank of India. Further the Exchange Traded Funds (ETFs) that invest only Appointment Committee of the Cabinet approved in debt instruments. So far, they could invest only the appointment of Challa Sreenivasulu Setty as in government and corporate debt. The minimum MD of SBI. retention period for these investments is three SEBI NOTIFIED NORMS FOR PMS: SEBI years. has notified its norms for Portfolio Management SEBI TIGHTENS MARGIN NORMS ON Services (PMS) doubling the minimum COMMODITY DERIVATIVES: SEBI has investment amount to be taken from clients to tightened norms for commodity futures trading by Rs.50 Lakh and asking such managers to raise categorising commodities based on their volatility their net worth to Rs.5 Crore within three years of and by imposing identical margins across notification. Under PMS, portfolio managers offer exchanges. A commodity with realised volatility customised investment advice to clients, typically above 20% will be categorised as High Risk high net worth individuals. The regulator has while those with 15-20% and 0.15% will be disallowed portfolio managers from charging termed as Medium and Low Risk. SEBI has upfront fees to clients, either directly or prescribed a formula for calculating the realised indirectly. SEBI has asked the portfolio managers annualised volatility of each commodity. High- not to leverage the portfolio of clients for risk non-agricultural commodities will have a
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minimum initial margin of 10% while it will be UNIFORM STAMP DUTY REGIME 12% for agricultural commodities. Medium and STARTS: The uniform stamp duty regime has low risk non-agricultural commodities will carry started in the country. Till now, brokers used to an initial margin of 8% and 6%. It will be 10% collect stamp duty at different rates based on the and 8% for agricultural commodities. state they reside, from traders. The stamp duty SEBI STEPS SCRUTINY OF DEALS BY rate will be Rs.1500 per Rs.1 Crore for delivery ARMS POST IL&FS FALLOUT: It came to (Holding of shares for more than one day) and light in the IL&FS scam that the company had Rs.300 per Rs.1 Crore in case of non-delivery used beneficiaries as a conduit to extend loans to (intra-day) trades. However, the new rates are related parties and other group companies. So, only on the buy-side and not on both buy and sell SEBI Working Group has now recommended that sides, as currently charged. transactions by arms of listed companies also be RBI ALLOWS KYC PROCESS ON MOBILE included in the definition of “Related-Party VIDEO: RBI has amended its norms to allow the Transactions” (RPTs). All related party “Know Your Customer” (KYC) process to be transactions and subsequent material completed through a mobile video conversation. modifications shall require prior approval of the RBI has also facilitated e-KYC and digital KYC audit committee of the listed entity. Provided that by allowing use of Aadhar or other e-documents a related party transaction to which the subsidiary in the customer due diligence process. of a listed entity is a party but the listed entity is RBI ISSUES GIDELINES FOR UNIVERSAL not a party shall acquire prior approval of the ACCESS TO FINANCIAL SERVICES: RBI’s audit committee. The committee also needs to National Strategy for Financial Inclusion (NSFI) specify if the transaction relates to any loans, 2019-24 has recommended increasing the inter-corporate deposits, advances or investments outreach of banking outlets to provide universal made or given by the listed entity or its access to financial services to every village within subsidiary. a 5 kilometre radius/hamlet of 500 households in GOVT. CONSTITUTES ABBFF OF hilly areas by March 2020. NSFI has suggested SUSPECTED FRAUDS: The Government has that the digital infrastructure must be expanded constituted an Advisory Board for Banking and through better networking of Bank Branches, Financial Frauds (ABBFF) for the first level of Business Correspondents, Micro ATMs, POS examination of suspected frauds in excess of Terminals and stable connectivity. It also Rs.50 Crore. The personal responsibility of recommended extending the digital financial MD&CEO of Public Sector Banks (PSBs) for infrastructure to co-operative banks and other compliance has been done away with. Powers specialised banks (payments banks, small finance have been delegated to the Boards of PSBs by the banks) as well as other non-bank entities to Department of Financial Services to put in place a provide efficiency and transparency in the suitable mechanism for ensuring compliance of services offered to customers. the various timelines laid down by RBI and CVC SUPREME COURT RULING ON PRE- circulars. The Centre has also aligned the norm DEPOSIT IN CHEQUE CASES: (Case- requiring compulsory examination of fraud for all Standard Chartered Bank VS. Heavy Engineering NPA Accounts exceeding Rs.50 Crore with the Corporation) In this case the Supreme Court has CVC circular of Jan.15 this year, whereby all ruled that if the demand to encash the bank such cases of suspicious fraud are to be initially guarantee is in terms of the contract it is not open referred to ABBFF. for a bank to determine whether the invocation IRDAI ISSUES NORMS ON POLICY was justified. It can not decide on its own whether HOLDERS OF MERGING PSBs: The it was a fraud, irretrievable injustice or special Insurance Regulator has come up with the equities. guidelines to protect the interests of Group SEBI GIVES TWO MORE YEARS TO insurance policy holders of merging state-run SPLIT CMD POST: SEBI has given India Inc banks. The Regulator said that upon the merger of two more years to separate the positions of Public Sector Banks, group health insurance chairman and managing director in companies. policies of customers of the merged banks shall The move follows resistance by big companies continue to be serviced by the insurer till the end and industry bodies, which cited a compliance of the policy period. The insurance companies burden amid a downturn in the economy. shall make suitable arrangements with the Previously, the regulator had mandated the top acquiring banks to this effect. 500 Listed Companies by market value to separate the chairman and managing director
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posts by April 1, 2020. Despite SEBI giving downgrade an instrument to “Non-investment ample time to India Inc to meet the requirement, Grade” with “Issuer not Co-operating Status”, if many firms were yet to comply with this, with all outstanding ratings of the issuer remain non- less than three months left for the deadline. Now cooperative for more than six months. If non- SEBI has postponed the deadline to April 2022. cooperation by the issuer continues for a further FRAUDULENT CLAIMS FOR INPUT TAX six months from the date of downgrade to non- CREDIT TO BE NON-BAILABLE OFENCE: investment grade or CRA should assign any new Government is likely to make fraudulent claims rating to such issuer, until the company resumes for input tax credit a non-bailable offence in the cooperation or the rating is withdrawn. hands of recipients of goods and services in the SEBI UNVEILES NEW FRAMEWORK FOR upcoming budget by tightening the GST Law. CORE SETTLEMENT GF: SEBI has come out CEOs, directors and employees directly with a new framework for Core Settlement responsible for making such claims can also be Guarantee Fund (GF) and liability of non- penalised as per the proposed changes aimed at defaulting members of clearing corporations. The tackling evasion under the Indirect Tax Regime. Core Settlement Guarantee Fund (Core SGF) is a The threshold of Rs.5 Crore will apply for the corpus used for settlement of trades during offence being treated as bailable and beyond that defaults and all intermediaries –stock exchanges, it will be non-bailable. The stringent provision clearing corporations and brokers –contribute already applies to suppliers of goods and services. towards it. The requisite contributions to the core These are to be expanded to include recipients SGF by various contributors for any month will found guilty of colluding in such fraud. be made by the contributors before the start of the RBI ON VALID DOCUMENT FOR KYC month. PROCESS: As per RBI’s directive to banks, a RBI NOD TO SHIVALIK MERCHANTILE letter from the National Population Register TO CONVERT INTO SFB: RBI has set the ball (NPR) containing details of name and address is rolling on the conversion of Urban Co-operative now among the list of “Officially Valid Banks (UCBs) into Small Finance Banks (SFB) Document” (OVDs) to be accepted by banks for granting “in-principle approval” to Shivalik opening of an account or for meeting any other Merchantile Co-operative Bank for conversion KYC norms. The others among the OVD list are into Small Finance Bank. This is the first such Permanent Account Number (PAN) Card, approval after RBI came up with a “Scheme on Driving Licence, NREGA Job Card and the Voluntary Transition of UCB into SFB” in Aadhar Card. Banks are gearing up to accept NPR September 2018. The approval granted by RBI is data following the direction. RBI released a valid for 18 months to enable the applicant to notification asking its customers to submit KYC comply with the requirements under the scheme. details before January 31, 2020. The list of KYC The minimum net-worth of the proposed SFB documents that it sought included the NPR letter. should be Rs.100 Crore from the date of Those who fail to submit the details can not commencement of business. As SFBs are required withdraw/transfer money. to maintain a minimum capital adequacy ratio of HALLMARKING OF GOLD JEWELLERY 15% of its Risk Weighted Assets on a continuous MANDATORY: Consumer Affairs Minister has basis, the availability of adequate capital should said that the jewellers can sell only hallmarked be ensured. Promoters should maintain at least jewellery and artefacts made of 14, 18 and 22 26% of the paid-up equity capital. carat gold from January 15, 2021 and violation of GOVT. TO LAUNCH NIRYAT RIN VIKAS this will attract penalty and imprisonment of one YOJANA: Govt. is working on measures to year. Jewellers have been given one year time to arrest the declining exports. For that, it plans to register with the Bureau of Indian Standards come out with an export financing scheme to (BIS) and implement the mandatory hallmarking offer lower interest rates in rupee and dollar terms of gold jewellery to ensure purity of the precious as well as reduced premium cost for small metal. Consumers have to watch out for four businesses. In this direction, the government is marks on hallmarked gold jewellery – BIS mark, going to launch a Niryat Rin Vikas Yojana Purity in Carat, Assay Centre’s name and Scheme wherein the interests rates will likely fall Jewellers’ Identification mark. to 3.15% for export credit in dollar terms and SEBI MODIFIES NORMS FOR CRAs ON 7.35% in rupee terms. Currently, interest rates are NON-CO-OP FIRMS: In a move to further pegged at 3 to 6% for credit in foreign currency strengthen the credit rating process, SEBI has and around 10% in rupee terms. directed the Credit Rating Agencies (CRAs) to
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GOVT. NOTIFIES MANDATORY BOM will have minimum five members and SECRETARIAL AUDIT FOR COMPANIES. maximum 12. The CEO would be a non-voting The Corporate Affairs Ministry has notified the member. mandatory secretarial Audit for Private Firms · ARCIL TO FLOAT AIF FOR BUYING with total outstanding borrowings of Rs.100 STRESSED ASSETS: With banks increasingly Crore or more from banks and financial insisting on 100% cash payment for selling their institutions. Under the previous rules, only public stressed assets, Asset Reconstruction Company companies with a paid-up share capital of Rs.50 (India) Limited (ARCIL) plans to float a Rs.1000 Crore or more or those with a turnover of Rs.250 Crore Alternative Investment Fund (AIF) to pony Crore or more were required to submit secretarial up the cash to buy them. ARCIL and its AIF will audit reports along-with their board report. co-invest for buying out these assets. ARC raised MCA CLARIFIES ON RULES FOR CO. Rs.258 Crore under the Arcil Asset SECRETARY IN PVT. FIRMS: Ministry of Reconstruction Fund (AARF), the first dedicated Corporate Affairs (MCA) has brought clarity into fund in India for investing in bad loans acquired the appointment of company secretaries by from banks and financial institutions in 2007. private companies. It has now stipulated that all Further ARC raised its second AARF amounting private companies with a paid-up capital of Rs.10 to Rs.191 Crore. Crore or above should have a whole-time · NON-ANCHOR PSBs URGE GOVT. FOR company secretary. The earlier norms on this NEW NAME AFTER MERGER: Previously, front were quite ambivalent with no specific rule in the merger of Vijaya Bank and Dena Bank with governing the appointment of company Bank of Baroda, the logos of all the three lenders secretaries in private companies. The private are being retained, with that of BOB being companies with Rs.5 Cr or more paid up capital prominent display with the tagline “Power of were covered by inference in around-about- Three”. However, this time, the non-anchor banks manner but now rules provide for direct coverage are not in favour of a Bank of Baroda like and with a higher threshold of Rs.10 Cr or more. branding. The anchor banks would be PNB, Canara Bank, Union Bank and Indian Bank in the GOVT. ANNOUNCES NIP WORTH RS.102 merger process of – (PNB, OBC and, United LAKH CRORE: Govt. announced a National Infrastructure Pipeline (NIP) with projects worth Bank of India), (Canara Bank and Syndicate Bank). (Union Bank of India, Andhra Bank and Rs.102 Lakh Cr over 5 years. The Centre will ensure timely implementation of projects spread Corporation Bank) and (Indian Bank with across 18 states and UTs. The govt. expects that Allahabad Bank). The change in bank’s name with more states /UTs submitting their proposals, would be a long-drawn process as it would need another Rs.3 Lakh Crore will be added to the total Parliamentary approval in Gazette notification. April 1, 2020 has been set as deadline for expenditure shortly. Of the capex to be completion of the merger process. undertaken for the infra sector, the Centre (39%) and states (39%) are to have an equal share with · SBI TO CREATE UNIT TO MANAGE the private sector chipping in with the rest (22%). RURAL AND SEMI-URBAN BUSINESS: The Centre expects the private sector’s share to State Bank of India is creating a unit to manage go up to 30% by 2025. the vast network of semi-urban and rural branches · RBI DIRECTS UCBs TO SET UP BOARD OF in the country to provide a thrust to scale up farm lending, micro finance and financial inclusion. MANAGEMENT: To facilitate professional Bank is making major changes in the retail management and focussed attention to their banking-related activities, RBI has directed the banking vertical, the National Banking Group. Urban Co-operative Banks (UCBs) with deposit The Bank has decided to create a separate size of Rs.100 Crore and above to constitute a network for micro-finance and financial inclusion Board of Management (BOM). In its guidelines under each circle. The new unit will be headed by a General Manager. Around 35% of branches in on constituting BOM in UCBs (Other than Salary Earners Banks) RBI said that it will be mandatory rural and semi-urban areas will be managed by this unit. for such banks to constitute BOM for seeking approval to expand their area of operation and/or · IRDAI FOR STANDARD HEALTH POLICY open new branches. These UCBs will also require HAVING UNIFORM RATES: IRDAI has prior approval of the RBI for appointment of their asked all insurers to offer Standard Health Policy CEOs. UCBs with deposit size of less than Cover on indemnity (Protection) basis only. This Rs.100 Crore and Salary Earners Banks, however, means that they can only pay for the actual are exempted from constituting BOM although expenses incurred (either cashless or through they are encouraged to do so voluntarily. The reimbursement). The Standard Policy will have SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 39
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benefits of cumulative bonus and insurers will not of global benefits and privileges for consumers in be permitted to impose deductibles. However, India- India’s Largest Credit Card Issuer. customers will be subjected to a fixed co-pay of Sector in which PMI rose to 56.8 in September 5% of claim amount across all ages which will be against 52 in August- Manufacturing Sector. explicitly disclosed in the application. There can Stock Exchange against which SEBI has imposed not be any added cover like critical illness or penalty of Rs.6 Crore for picking up stake in six benefit-based covers. Further rates have to be entities without obtaining approval- National uniform all India and insurers can not have Stock Exchange. geography or zone-based pricing. Atal Tunnel which will be inaugurated at Rohtang · GOVT. ISSUES “WINDING-UP RULES”: by PM Modi to connect 9.02 KM long Manali and The Corporate Affairs Ministry (MCA) has come Lahul-Spiti- World’s Longest Highway Tunnel. with “Winding-up Rules” which among other Report according to which, a total of 269 million things provide for summary/curtailed procedure Viewers watched IPL in its opening week which is for shutting companies of specified thresholds. 11 million more viewers per match compared to The winding up of companies falling within the 2019- Nielsen Report. specified thresholds will henceforth require Bank in which Three-member Committee of approval of the Central Government instead of the Directors has been formed to exercise the powers NCLT. MCA move will come into effect from of MD&CEO of the Bank- Dhanlaxmi Bank. April 1 and is expected to reduce the burden of Bank whose operations have been banned by RBI the NCLT as summary procedure for liquidation after allegations of embezzlement- Guru can now be filed with the Central Government. Raghvendra Bank. · KOTAK BANK REACHS SETTLEMENT State which has become the First State in the WITH RBI: Kotak Mahindra Bank has reached a Country to become eligible who can borrow 0.5% settlement with RBI on the issue of diluting the over and above the standard 3.5% of GDP- promoter stake in the bank. As per the agreement, Andhra Pradesh. the promoter stake in the bank will be diluted to Network which is to be set up to assess “Vaccine 26% in six months after final approval from the candidates”- Global Lab Network. regulator. RBI had originally asked the promoter Regulator which is to rope in Consultant for to reduce his share holding to 15% of the paid up hiving off NPS Trust and Structural Rejig- capital by March 2020. As on December 31, PFRDA. 2019, promoters held 29.96% stake in the bank Law which becomes operational from October 1- with its founder and promoter Uday Kotak Bilateral Netting Law. holding the lion’s share of 29.67%. Now RBI has Company which has become the First Company in principle accepted the proposal for capping the after Reliance Industries in India to cross the promoter’s voting rights in the bank at 20% of the Market-Capitalisation (M-CAP) of Rs.10 trillion- Paid Up Voting Equity Share Capital (PUVESC) Tata Consultancy Services (TCS). until March 31, 2020. From April 1, 2020, the Prize which has been awarded jointly to Dr. promoter’s voting rights in the bank will further Harvey J Alter, Michael Houghton and Charles M be lowered and capped at 15% of PUVESC. Rice for discovery of “Hepatitis C Virus”- Noble
Prize in Medicine.
Indian Ride-hailing Firm which has been found GENERAL AWARENESS “Not Fit and Proper” to hold licence in London- Ola. OCTOBER 2020 Dinesh Kumar Khara has been appointed by the Tax which is to be collected by the Seller from Centre as- Chairman of SBI. October 1, 2020 if his turnover exceeds Rs.10 Prize awarded to three Scientists- Britain’s Roger Crore in the last financial year as per directions of Penrose, Germany’s Reinhard Genzel and CBDT- Tax Collected at Source (TCS). American Andrea Ghez for their discoveries about Transactions which crossed 1.7 Billion Mark as of one of the most exotic phenomena in the universe, September 29 and value of transactions crossed 3 the Black hole- Noble Prize for Physics. trillion- UPI Transactions. Programme which the finance Minister launched Limit which has been fixed by RBI for Second for MSMEs- Indian Bank’s Business Mentoring Half of this Year at Rs.1.25 Trillion- Ways and Programme. Means Advances (WMA) Limit. Ashima Goel, Jayanth R Verma and Shashanka SBI Card which has entered into a strategic Bhide have been nominated by the Government to partnership with American Express to offer a mix
SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 40
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– Reconstituted Monetary Policy Committee of Company on whom SEBI has slapped Rs.30 Crore RBI. penalty for Insider Trading- Kirloskar Brothers. Ratio which may hit 15%, Highest since Accounts in which balance surged from Rs.11, Independence- Cash-to-GDP Ratio. 000 Crore as on April 1, 2020 to Rs.1,30,741 Prize awarded to two scientists Frenchwoman Crore on October 14-Jan-Dhan Accounts. Emmanuelle Charpentier and American Jennifer India becomes the Most Indebted Country after for “Work on Gene Editing”- Noble Prize in Bhutan and Sri Lanka in South Asia as its ratio hit Chemistry. record high of 90%- Debt-GDP Ratio. M. Rajeshwar Rao, currently ED of RBI has been After a gap of 35 years, India gets – appointed by the ACC as- RBI Deputy Chairmanship in International Labour Governor. Organisation (ILO) – UK won Defense Orders worth $14.2 Billion in The Indian School Of Business’ has been ranked 2019 and kept its position as- World’s 2nd First in India in the latest FT 2020 Rankings and Largest Arms Exporter after US. also ranked- 53rd Globally. Banks which must have an ED besides MD&CEO Bank form which SBI has raised Loan worth $1 in the bank- Small Banks. billion- Japan Bank for International RBI facility which will be available for Cooperation. “24X7X365”basis from December onwards- Real- Indian Institute of Science, Bengaluru has Time Gross Settlement (RTGS) Facility. emerged as the Top Ranked Indian University in- Prize which UN Food Agency won – Noble Peace Times Higher Education’s Rankings 2020. Prize. Prize awarded to US Duo academics Paul SEPTEMBER 2020 Milgrom and Robert Wilson for “Auction Theory”- Noble Prize in Economics. Growth which contracted by 23.9% in April-June, International Agency which has slashed “India’s Worst Performance since quarterly measurement GDP Growth Forecast to -10.3%”- IMF. began in 1996 and First Contraction since 1980- SJ Mukhopadhaya, Former First Chairperson of India’s GDP. National Company law Appellate Tribunal has Group which has become in Infrastructure Sector joined- GFG Alliance’s Global Advisory Board. especially Transport, unmatched by any Player Stock Market which tops $10 trillion- World’s even Globally- Adani Group. Second Largest Market of China. Bank which has invested $650 million in the To make land acquisition easier for public projects construction of Kanpur’s Metro Line- European besides ending dubious land ownership, Govt to Investment Bank. start- 14-digit Unique Land Parcel Transactions which clocks Record Volume of 3- Identification Number. Lakh Crore in August- UPI Transactions. Govt. has approved for all Ministries and public departments about Mandatory utilisation of Court which has allowed Telcos 10 Years to clear services rendered by- BSNL and MTNL. their AGR dues- Supreme Court. Bank which approved $12 Billion for developing Body which will be First Body in the Accounting countries to finance the purchase and distribution World to develop a full set of FAIS standards for of Covid-19 Vaccines- World Bank. forensic professionals and stakeholders- CA Council which decided to suspend publishing TRP Institute (ICAI). ratings of News Channels- Broadcast Audience Apps which have been blocked numbering 118 Research Council. including PUBG- Chinese Mobile Apps. AUM which has crossed the “Rs.5 Lakh Crore Finance Co. which is to raise Rs.50, 500 Crore by Mark”- Pension Assets under Management issuing Hybrid Instruments on private placement Court which has appointed retired Supreme Court basis- LIC Housing Finance Co. Judge Justice Madam B Lokur as one-man Committee to prevent “Stubble-burning” in Airlines which can operate up to 60% of their Punjab, Haryana and UP- Supreme Court. capacity from 45% at present- Domestic Airlines. Rajkiran Rai, MD&CEO of Union Bank of India Index in which India ranks 48th Position into the has been elected as- New Chairman of IBA. Top-50 club- Global Innovation Index. According to S&P Rating Agency, Bank which Mission which has been approved by the Union has sufficient financial headroom to withstand Cabinet to bring in reforms in Civil Services- downside risks from tough operating conditions in Karmayogi Mission. India- HDFC Bank. SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 41
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Organisation which has set up Dispute Panels Scheme under which over 42 Crore poor people against India’s Import duties- World Trade have received financial assistance of over Organisation. Rs.68000 Crore- PM Garib Kalyan Package. Stock Exchange which is creating two new Bank which has exited National Stock Exchange Crypto Currency Indexes with the goal of setting (NSE) by selling its remaining shares- IDBI the pricing standard for Bitcoin and Ethereum in Bank. Asia- Singapore Exchange Ltd. (SGX). Stock Exchange which has got nod for e-KYC S. Krishnan, presently ED of Canara Bank, has Aadhar Check- NSE. been appointed as- MD&CEO of Punjab & Agency which fined Standard Chartered with Sindh Bank. $13.6 million for breaking foreign exchange Investments which have tumbled 84.2% year-on- rules- India’s Anti-money Laundering Agency. year in August to $306.46 million against Small Finance Bank which plans to organize its $1937,24 million in August 2019- Investments in “First Finetech Conclave” which will provide a Indian Start-ups. platform to showcase their new digital banking From April, car-owners will not be able to obtain solutions- ESAF Small Finance Bank. a third-party insurance cover if they do not have- During Covid-19 Crises, IPO subscribed 150 FASTag for Cars. times- Happiest Minds. Vinod Kumar Yadav has been appointed as – Scheme which has been launched by PM Modi by CEO of Railway Board. inaugurating the e- Gopala App for Fisheries Debt which hit $3.3 trillion bigger than its Farmers- PM Matsya Sampada Yojana. Economy’s Size for the First Time since World Subscribers who will get interest for FY 2020 in War-II- US Debt. two parts-8.15% now and 0.35% by December Directors Isha Ambani and Akash Ambani under (Total 8.50%) - EPFO Subscribers. the age of 40 have been named as “Emerging Index which RBI to construct to be the Key to Leaders” Globally in FORTUNE-40- Reliance accurately measure the deepening and penetration Jio Board Directors. of Digital Payments across the Country- Digital Regulator which has attached bank and Demat Payment Index. accounts of Fugitive businessman Mehul Country which has cancelled “Airshow” due to Chowksi to recover dues over Rs.5 Crore.-SEBI. Coronavirus for First Time in 24 Year History- Ranking in which Andhra Pradesh State has been China. ranked in “Top Position” in the country- Ease of Prize for which US President Donald Trump has Doing Annual Business Ranking. been nominated by Norway Parliament for his Scheme under which the Govt. Panel has okayed peace efforts in West Asia- Noble Peace Prize. $100 billion Mobile Export Proposals- Subhash Kamath, CEO at BBH & Publics Production Linked Incentive Scheme. Worldwide, India has been elected as- Chairman Bank which has moved to invoke personal of Advertising Standards Council of India. guarantee of Bhushan Power Promoter Sanjay Report according to which there is “68% Decline Singhal- SBI. in Wildlife Population” since 1970- WWF’s 2nd Worst-hit Nation which has been replaced by Living Planet Report 2020. India after having with over 42 Lakh Covid Veteran Actor Paresh Rawal has been appointed Cases- Brazil. as- Chairperson of National School of Drama According to NITI Aayog, States will be ranked (NSD). on- Poverty Index Parameter. Bank which has been ranked First under “Top SEBI has set March 31 as cut-off date for- Re- Improvers” category by IBA- Bank of lodgment of Share transfer for Demat. Maharashtra. Authority which plans in three months to come CITI to be 1st Big Street Bank to be run by out with “Mobile App” for investor Protection to Woman CEO- Jane Fraser. file claims- Investor Education and Protection Company which has become First Indian Fund Authority. Company to surpass $200 billion in Market India took off and flew “Hypersonic Vehicle” for Capitalisation- Reliance Industries Ltd. 2 kilometers per second and joined- Select Club of Russia, US and China.
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Ranking in which Gujarat retained its Top Maharashtra’s Appellate Authority for Position followed by Andaman and Nicobar – Advance Rulings. Best State Start-up Ecosystems Rankings 2019. Indian Industrialist who made “Rs.90 Crore an SFC which is the only Financial Corporation in Hour” since Lockdown- Mukesh Ambani, the Country raising funds without a Government Chairman of Reliance Industries. Guarantee- Kerala Financial Corporation. Certificate for which the Govt. has relaxed the AUGUST 2020 existing timeline (November) for submission by Central Government Pensioners up to December Inflation which eased to 5.06% in June from 31- Life Certificate. 8.59% in the same month last year- Retail Inflation for Industrial Workers. Index in which India falls to 105th Place from Partha Pratim Sengupta has been appointed as- th 79 in- Global Economic Freedom Index. MD&CEO of Indian Overseas Bank. Authority which has suspended Licence of 56 Economy which tumbled into its Worst Customs Brokers over a period of one year on Recession by record 12.1% in the Second account of their activities being “Suspicious”- Quarter- Euro Zone Economy. Central Board of Indirect Taxes and Customs (CBIC) Six Banks-SBI, PNB, BOB, BOI, Canara Bank and Union Bank-have been shortlisted in which Bank Chief who has been conferred with the Govt. to cut in 12-18 months its- Stake to Lifetime Achievement Award by Euromoney Awards of Excellence 2020- Aditya Puri, 51%. MD&CEO of HDFC Bank. Tournament which will be held from Rajesh Khullar has been appointed by the Govt. September 19 to November 10 at UAE- Indian as- ED of World Bank. Premier League (IPL). Sameer Kumar has been appointed by the Govt. Scheme under which the accounts spurred with as- ED of Asian Development Bank. Covid Relief to “40 Crore Mark” since the launch in August 2014- PM Jan Dhan Yojana Asian Development Bank (ADB) has appointed Takeo Konishi as- New Country Director for (PMJDY) Scheme. India. After Two Power Exchanges (IEX and PXIL) Company which becomes IInd Indian Company PTC India gets CERC nod to set up – Third to cross Rs.9 Trillion in Market-Capitalisation- Power Exchange. TCS. Shortest ruling benchmark ever, Govt has Index in which India slipped 11 places to 54th launched new set of- 10-Year Benchmark among 56 Countries- Appreciation of Home Bonds. Prices Index. Bonds listed on NSE which delivered a return of 8-12% in last one month due to sharp rally in Index in which India has been ranked at 116th Position – World Bank’s Human Capital Index. gold prices- Sovereign Gold Bonds. Rating Agency which has downgraded RBI has approved the name of Sashidhar “Sovereign Rating of Kuwait” for First Time on Jagdishan as- MD&CEO of HDFC Bank. account of Country’s liquidity risks- Moody’s. Govt. has approved extension for appointing System which goes Live- Faceless Income tax Ajay Tyagi by more 18 months till February Appeal System. 28, 2022 as- Chairman of SEBI. New Regulator which has come into existence- Free Export of “Made-in-India Ventilators” for National Medical Commission. Covid-19 allowed by- DGFT. Regulator which has identified LIC, GIC and Returns which surged from 4.04 Crore to 6.87 New India Assurance as “Systemically- Crore and scrutiny of cases declined from Important” Insurers and subject to enhanced 0.71% to 0.25% from Assessment Years 2015- regulatory supervision- IRDAI. 16 to 2018-19 –Income Tax Returns. PD Vaghela has been appointed by the Corporation which launched its Fund-raising of Government as- Chairman of TRAI. Rs.14, 000 Crore through the Qualified Authority which ruled that Prize Money received Institutional Placement- Housing from Horse-race Clubs are not liable to GST- Development Finance Corporation (HDFC)
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State which is Most Tax-Compliant State in FY While Cheapest City in the World in terms of 2019 with 22.3% Income Tax Returns filing Rent is “Ho Chi Minh City”, Most Expensive against National Average of 12%- Gujarat. City in the World is- New York City. Portal which has doubled its Network Capacity Country which enters Recession as GDP to handle 3 Lakh Users who were 1.5 Lakh tumbles 20.4%, Worst in Europe- Britain. before June 2020- GST Portal. Scheme which has been launched by the Prime On Pilot Basis, An Exclusive Parcel Train Minister for all tax payers in India- Faceless which has been inaugurated by the Govt. to Tax Assessment Scheme. carry fresh and perishable farm produce Credit Registry which will go live early 2021- between Nasik and Patna- Kisan Rail. RBI’s TCS-Coded Public Credit Registry. Institute which has announced the cost of Index in which Bengaluru has been ranked 26th “Covid-19 Vaccine” at Rs.250 a dose- Serum Indian City Globally as “Fastest Growing Institute of India. Residential Market in Quarter-2” while Manila Index in which sentiment has been steadily has topped the list- Knight Frank Prime falling since imposition of Biggest Pandemic Global Cities Index. Lockdown in March and reached at 53.8 in July Foreign Bank which has invested about Rs.15, (Below 100 Mark)- Consumer Confidence 000 Crore in ICICI Bank in its Fund-raising Index. Plan- People’s Bank of China. Registry which will be launched by the Govt. to After Vivo Pullout, “Dream-11” has bagged- enable collection of real-time clinical data for IPL Title Sponsorship. evidence-based clinical practice, research, formulating guidelines and policy making- Clients who can trade in US Market- Axis National Clinical Registry for Covid-19. Securities Clients. Mission has been launched by the Centre which Norway’s $1.15 Trillion Sovereign Wealth proposes a Unique Health ID for each citizen- Fund posted a Loss of $21.27 Billion in first National Digital Health Mission. half of 2020- World’s Largest Sovereign Wealth Fund. Country which has emerged as World’s Biggest Covid-19 Hotspot in August- India followed Ashok Lavasa, Election Commissioner who has by US and Brazil. resigned to join as- Vice-President of Asian Development Bank. Scheme from which Gujarat, too exits after Bihar and West Bengal while Punjab did not Bank which has approved a loan of $1 Billion implement it at all, citing Premium Burden- to support construction of the Delhi-Meerut PM Fasal Bima Yojana. Regional Rapid Transit System- Asian Development Bank. Online Dashboard which has been launched by the Union Finance Minister to be a one stop Autonomous Agency which is to be set up by solution for all stakeholders for getting the Govt. to conduct Common Eligibility Test information on Infrastructure Projects in India- eliminating the need to multiple tests- National National Infra Pipeline Online Dashboard. Recruitment Agency. Tata Motors has overtaken Mahindra & Subsidiary which has been launched by NPCI Mahindra to third place in terms of vehicles to promote UPI, RuPay Overseas- NPCI registered in July while top of the Company is- International Payments Ltd. (NIPL) Maruti followed by Hyundai. Index in which Indore has emerged as the “Cleanest city in the Country” for the 4th time in Indian Industrialist who has moved one notch up to emerge as the “4th Richest Man” in the a row- Swachh Survekshan 2020. World- Mukesh Ambani, MD of Reliance Bureau which is to be given Statutory Power by Industries Ltd. the Govt. to become “One-Stop Repository” for Country which has claimed to be “First all labour-related data- Labour Bureau. Country to have a Covid-19 Vaccine”- Russia. In order to counter bogus entities, the Govt. has Bank which plans to Capital Infusion of introduced Aadhar Number Authentication for Rs.2700 Crore for branch operations in India- getting registrations under-GST. Deutche Bank.
SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 44
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Scheme under which total number of farmers New process of classification and registration covered dropped at 32% as many states opt out of enterprises starts on July1.Govt. has of the Scheme- PM Fasal Bima Yojana. launched- New Portal for MSMEs CBDT made it mandatory for personal hearing Institute in India which has climbed to 36th for GST-related Appeals via- Video Position from 61st last year into the Global Top Conferencing. 50 Executive MBA Rankings- Indian Institute Brokerage Firm Zerodha has been selected as of Management, Bangalore. “Startup of the Year” and got- Economic Collection which improved to Rs.90, 917 Crore Times Startup Award 2020. in June against 62, 009 Cr in May and Rs.32, Importers for 24 Major Crops to declare that 294 Crore in April- GST Collection. products are “Genetically-modified” (GM) and also have “Non-GM origin” from January 1, Bank which has approved $750 Million Loan to 2021- Declaration Mandatory. the Indian Gov. for 19 years including moratorium period of 5 years to support NABARD introduces debt and credit guarantee products to small units in rural areas hit by MSMEs- World Bank. Pandemic- Micro-finance Institutions. Regulator which clarified that stamp duty is not Frauds which doubled in FY 2020 to Rs.1.85 applicable on redemption of mutual fund units trillion from Rs..71, 543 Crore in FY 2019- but switching in mutual fund would attract the Bank Frauds with Rs.1 Lakh and Above. stamp duty- SEBI. Index which was launched by NITI Aayog, Rating Agency according to which India’s GDP Gujarat has topped the states in the Country may contract by(- 6.4%) for the current followed by Tamil Nadu and Rajasthan- financial year- CARE Ratings Agency. Export Preparedness Index. Delhi Government has launched Country’s- RBI transferred Rs.57, 100 Crore of its surplus First Plasma Bank. or income to the Government which accounts Apps. which have been banned by the Govt. for 44% only- Lowest Surplus Transfer in last 7 Years. and blocked their access to mobile users in the country- 59 Chinese Apps. Name of Dinesh Kumar Khara, presently Senior-most MD of SBI has been Bank which has decided to wind down its UK recommended by Banks Board Bureau as- Subsidiary- AXIS Bank. Chairman of SBI. NHAI has set up a Panel to appoint a Chairman Facility which City Union Bank has launched and two independent directors to manage its to facilitate new customers to open savings Infrastructure Investment Trust (InvIT) and the account digitally from the comfort of the Panel to be headed by-HDFC Chairman Homes- Video-KYC Facility. Deepak Parekh. Court has ruled that States and Universities can Bank which has extended its Digital Auto not promote students without holding final year Loans Product in which loan to be given within exams by September 30- Supreme Court. 10 seconds in 1000 cities throughout the India has been ranked 72nd among 106 Countries Country- HDFC Bank. while Switzerland topped the List- Average Currently, Drones or components manufactured Wage Per Month. by China form the backbone of India’s Drone Industry and the Chinese Company which has JULY 2020 monopoly on it- DJI Drones. Package under which PFC, REC to offer loans Tribunal which ruled that “Pooja expenses to State Discoms @9.5%- Liquidity Infusion incurred for the smooth functioning of business Package of Rs.90, 000 Crore. can be treated as “Business Expenses” which Balance which has recorded a Marginal Surplus qualify for income tax deduction”- Income Tax of $0.6 Billion in the fourth quarter ended Appellate Tribunal. March 31, 2020- India’s Current Account Balance.
SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 45
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Country’s Largest Commodity Exchange to insolvency professionals and valuation launch Options trading on Spot Gold (Min. 100 professionals- Insolvency Regulator IBBI. grams)-MCX. Global Banking Co. which has got approval for Bank which has launched an “Instant Personal setting up an IFS Banking Unit at GIFT City – Loan Disbursal Facility in Seconds”- Yes Bank. HSBC. As per IRDAI guidelines, all General Insurers Govt. has proposed giving equal opportunity in to offer First of its kind Standard Corona Employment to transgender community under- Insurance Product compulsorily by July 10- Transgender Persons Rules 2020. Corona Kavach. Scheme under which the due date for filing SEBI to permit Petrol and Diesel for- Futures annual return has been extended by Govt. to Trading. August 31- Scheme for Composition Dealers. Bank which is to provide $400 million Aid to Indian Company which has become World’s 3rd support “Namami Gange Programme” to Largest Energy Firm after Saudi Aramco and rejuvenate the Ganga River- World Bank. ExxonMobil- Reliance Industries Ltd. Standard Health Insurance Policy in which Ashok Lavasa, currently Election IRDAI has removed the Cap on Maximum Sum Commissioner, has been appointed- Vice- of Rs.5 Lakh and Minimum Sum of Rs.1 Lakh- President of Asian Development Bank. Arogya Sanjeevani. Policy. Scheme under which the Banks to buy Rs.14, Index in which India’s Real Estate Sector 000 Crore Bonds, CPs issued by NBFCs under- jumped five spots to rank 34 on JLL and Revamped Partial Credit Guarantee Scheme. LaSalle’s- Global Real Estate Transparency DOT has exempted 3 PSUs GAIL, GRID Corp. Index. and Oil India Ltd from paying- Rs.2.3 Lakh Regulator with which CBDT has signed MOU Crore –Adjusted Gross Revenue (AGR) Dues. for exchange of data- SEBI. State which has Topped and got First Ranking Stock Exchange which has celebrated its 147th in the Country in attracting Fresh Investments Birthday on 9th July- Bombay Stock Exchange. in the State during First Quarter- Tamilnadu Former RBI Governor Rangrajan has got the followed by Maharashtra and UP. Lifetime Achievement Award- Mahalanobis Scheme since its launch in 2015, July 2020 has National Award. been the Best Month for sale of gold bonds IRDAI has formed a Working Group to worth 4.13 tonnes- Sovereign Gold Bond examine the feasibility of “Pandemic Risk Scheme. Pool” which is to be headed by- Suresh Court which ruled that the Legal Heirs are Mathur, ED of IRDAI. under no statutory obligation to intimate the In a major relief to BSNL and MTNL to issue death of the Assessee to IT Department as the long term bonds, restructure their existing debt responsibility to pay the dues lies with legal and meet capex requirements, the Govt. has heirs- Delhi High Court. approved issuance of- Sovereign Guarantee of According to Report of Institute for Rs.15, 000 Crore. International Finance, “Debt which surged to a Out of 10 Global Billionaires, Indian record of $258 trillion in First Quarter of 2020” Industrialist who has got 8th Ranking in the as Economies around the world shut down due Bloomberg Billionaires Index– Mukesh to Covid-19- Global Debt. Ambani, Chairman of Reliance Industries. Aditya Puri, MD of HDFC Bank who earned a US remains India’s Top Trading Partner for salary of Rs.2.91 Crore in FY 20 becomes- second consecutive fiscal in 2019-20 having Highest Paid Banker 2020. bilateral trade of $88.75 billion against $87.96 Scheme under which UP has got the Highest billion in 2018-19. Allocation of more than Rs.12, 000 Crore Regulator which allows Online delivery of followed by Rajasthan in the Country- education beyond September 30 to prospective Agriculture Infrastructure Fund Scheme. SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 46
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As per IRDAI mandate, any sale, purchase and As per Survey by Randstad Employer Brand pledge of equity in excess of 5% of an Research, Microsoft India followed by Insurance Company’s paid up capital will Samsung India and Amazon have emerged- require- Regulator’s Prior Approval. India’s Most Attractive Employer Brand. CBDT launched “Faceless Assessment” in After 34 years, India is to adopt- New National Taxation Arena became- World’s Education Policy. First Country Using Such System. Multilateral Funding agency which has As per IRDAI mandate, any sale, purchase and approved $3 million as Covid Grant to India- pledge of equity in excess of 5% of an Asian Development Bank. Insurance Company’s paid up capital will Union Cabinet has approved “Change in the require- Regulator’s Prior Approval. Name of HRD Ministry” to- Education Federation which has abstained from signing Ministry. Wage Pact for Bank Employees- Bank Universities which have been allowed by the Employees Federation of India (BEFI) Indian Govt. to set up Campuses in the Voluntary Retirement Scheme (VRS) has been Country- Foreign Universities. offered to its Employees above 45 years of age Nearly 23 Years after Sukhoi Aircraft were before its Divestment by- Bharat Petroleum imported, a Fleet of Five French-manufactured Corporation Ltd. Jets have arrived in India- Rafale Combat Jets. Govt. issued orders for grant of Permanent Economy of the Country which suffered its Commission to Women Officers in the Army as sharpest downturn to 32.9% since 1940 –US per- Supreme Court’s Directive. Economy. National Dairy Development Board (NDDB) has inaugurated at Anand ((Gujarat)- India’s JUNE 2020 First NABL-accredited Honey Testing Lab. Package under which PFC, REC to offer loans to Stock Exchange which is First to launch State Discoms @9.5%- Liquidity Infusion “Option Trading in Agriculture Goods”- Package of Rs.90, 000 Crore. NCDEX. Rupee set to enter a new era on 1st June, as Local Aditya Puri, MD of HDFC Bank who is to Banks to trade rupee in- Overseas Non- retire in October this year at the age of 70 years deliverable forwards (NDF) Market. after serving the Bank for last 26 years- Bank which has approved $177 million Loan to Longest Serving MD of Private Bank. upgrade state highways in Maharashtra- Asian Development Bank. After banning 59 mobile applications including Rating Agency which has downgraded India’s TikTok, Govt. has banned 47 more rating to the Lowest Investment grade of Baa3 applications- Chinese Apps. from Baa2 with Negative Outlook for first time in About 84, 545 fraud cases involving about 22 years- Moody’s. Rs.1.85 trillion have been reported by- Proposal “that Non-profit Organisations can Scheduled Commercial Banks and FIs. directly list on Social Stock Exchanges” has been Indian Economy to see this fiscal year with approved by Panel set up by SEBI which is “Current Account Surplus of 0.4% of GDP”- headed by- Ishaat Hussain. After 16 years since FY 2004. Uday Kotak, CEO of Kotak Mahindra Bank has been appointed as- President of Confederation of Scheme under which the Centre to ban import Indian Industry. of weapons that can be produced indigenously- Country which has launched a probe against India Atmnirbhar Bharat Abhiyan. for imposing Digital Services Tax on e-commerce Stock Exchange which has introduced trading Players- United States. in Treasury Bills (T-Bills) and State Public Rights Issue of Rs.53, 124 Crore of Development Loans (SDLs) in its Capital Reliance Industries under Covid-19 Pandemic Market Segment-NSE. situation oversubscribed 1.6 times- Largest Offering by Non-financial Company in World. SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 47
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Bank which has launched SIB Insta, a paperless Network which will be used by EPFO for Life quick Online Account opening platform that Certification of its Pensioners- Common Service facilitates instant account opening with zero Centres Network human contact- South Indian bank. Court which ruled that “Reservation of Seats to Standard Chartered Bank has started operations at Certain Communities is not a Fundamental IFSC GIFT City, Gandhinagar and becomes- First Right”- Supreme Court. Global Bank. Bank which re-launched its Aadhar-based instant Regulator which has decided to publish on daily digital facility in which “Insta Savings Bank basis data on volume and value of transactions Account” will offer a complete paperless and through various Payments Systems- RBI. instant digital savings account opening with just Regulator which has asked all insurers to obtain a PAN and Aadhar- SBI. Legal Identifier Code before July 31- IRDAI. Authority which becomes 1st in Construction Biocon Executive Chairperson, Kiran Mazumdar sector to go “Fully Digital”- National Highways Shaw has become the First Woman Entrepreneur Authority of India. in India to win- EY World Entrepreneur Award Reserves which crossed the $500 Billion Mark on 2020. June 5 for the First Time which is the Highest Department which is to roll out First Phase of weekly increase since September 28, 2007- Countrywide faceless assessment of Foreign Exchange Reserves. Consignments to improve transparency- Customs Regulatory Authority which said that the Health Department. Insurers will not be allowed to contest the claims Index in which Gujarat, Tamilnadu and once the premium has been paid for continuous Maharashtra have topped in the Country ensuring period of eight years- IRDAI. food safety in 2019-20- FSSAI Food Safety Bank which has extended paperless OD facility to Index. Salary Account Holders- ICICI Bank. Bank which has been adjudged “Best Domestic Index which entered the Deflationary Zone for Bank” at the Asiamoney Best Bank Awards 2020- First time in over four and half years as the HDFC Bank. market fell 3.2% in May- Wholesale Price Index. Bank which projects that India’s economy to Bank which has extended $216 Million Line of contract by 3.2% in the current fiscal which is Credit to Malawi to help project exporters from sharp downgrade from its April projection of India to execute drinking water supply schemes- 1.5% -2.8% growth- World Bank. EXIM Bank of India. New Zealand lifted all social and economic Index in which India continues to remain Ranked restrictions declaring that it was free of 43rd on- Annual World Competitive Index. Coronavirus- First Country in World to return India received $51 Billion in foreign investment Pre-pandemic Normality. in 2019- World’s 9th Largest Recipient of FDI. Index according to which the Hiring Activities/ Court which sees “No Merit in charging interest Recruitment declines 61% in May due to on unpaid interest for deferred loan payment Nationwide Lockdown- Nakuri-Jobspeak Index. instalments during 6 month Covid-19 moratorium Bank which has invited application of Chief period” and asked RBI and Govt. to reconsider Financial Officer (CFO) on contract with salary the issue- Supreme Court. up to Rs.1 Crore a year, more than the standard Bank which approved an additional $750 Million salary of the Bank’s Chairman- SBI. Loan to India to fight Covid-19 pandemic crises- IIT Mumbai has retained its status as India’s Beijing-based Asian Infrastructure Investment Premier University at 172nd Global Rank- World Bank. University Rankings. Rating Agency which downgraded India’s Rating Agency which affirmed its Sovereign sovereign rating to BBB- and its Outlook as Rating for India at “BBB”-Lowest Investment Negative- FITCH Rating Agency. Grade- Standard and Poor’s Rating Agency. Former RBI Governor Urjit Patel has been Ranking Framework in which IIT Madras appointed as- Chairman of National Institute of retained the Top Spot as India’s Best Institute in Public Finance and Policy. both the “Overall and Engineering Categories”- Think Tank which has recommended “Indigenous National Institutional Rankings Framework. 4G for BSNL”- NITI Aayog.
SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 48
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Company with Market Capitalisation crossing Scheme which was launched in January for 12 Rs.11 Trillion for First Time has also become States now has been extended for more 5 states “Net-Debt Free”- Reliance Industries Ltd. now totaling 17 states in the country- Scheme for K.Paul Thomas, MD&CEO of ESAF Small Portability of Ration Cards. Finance Bank has been elected as- Chairman of Indian Government to cap Corona Relief at $60bn Sa-Dhan, Largest Association of Community as excess spending could trigger – Sovereign Development Finance Institutions in India. Rating Downgrade. India has become after holding worth $157.4 For the First Time in History of Independent Billion on April-end- 12th Largest Holder of US India, Auto Car-makers posted – Zero Sale in Govt. Securities. April. Nita Ambani with Reliance Foundation is the Co-op. Bank whose licence has been cancelled by only Indian in the Global List of- Top RBI- CKP Co-operative Bank Mumbai. Philanthropists 2020. As, collections of Power Discoms across the Banks whose outlook has been revised to country have reduced by 80% barely enough to “Negative” on IDRs by FITCH Rating Agency- sustain staff salaries, India faces- Serious Risk of SBI and PNB. Blackouts. Mukesh Ambani, Chairman of Reliance Under new FDI norms, for investments from Industries Ltd whose net worth has jumped to countries sharing land border with it including $64.5 Billion and making him the -Only Asian China, Prior Govt. Nod made- Mandatory. Tycoon in Exclusive Club of World’s Top 10 Bank which has been allowed by Delhi High Richest People.(HT) Court to deduct Indiabulls’ loan instalments from Rating Agency which has projected Indian their Fixed Deposit which it holds as security- economy to shrink 3.1% in 2020- MOODY’s. HDFC Bank. Guideline made Mandatory through which Sellers Imports which fell to 99.5% to 60 kilogram in to enter the “Country of Origin” while registering April from 13 tonne in month ago- Gold Imports. new products on it- Govt e-Marketplace (GeM). For First Time, Court whose hearing to be Country whose Central Bank has suspended Broadcast Live- US Supreme Court. “WhatsApp Digital Payment System”- Brazil Banks whose earnings estimates have been cut by Central Bank. 90% and downgraded them by Bank of American Bank which has launched its Digital wallet “Yuva Securities- SBI, ICICI Bank, BOB and IndusInd Pay” to enable contactless payments- YES Bank. Bank. Govt. notified Ordinance in which Co-op. Banks India to deploy Commercial Jets, Military to come under- RBI Supervision. Transport Planes and Naval warships to bring Govt has notified amending Rule-93 relating to back 108million Indians from abroad due to “Dimensions of Motor Vehicles” under the Central Covid-19 disruptions- Biggest Peacetime Motor Vehicles Rules 2989- At par with Global Repatriation. Standards. Sector in which the Index plunged to 5.4 in April from 49.3 in March, an unprecedented contraction May and Feb 2020 since the survey started over 14 years ago- Rating Agency which predicts that India to see a Services Sector. permanent loss of 4% of GDP or Rs.9 Lakh Crore To ensure health and hygiene measures the due to disruptions triggered by Covid-19 “Construction Sector” to have- Covid Marshals. pandemic- CRISIL. State which has emerged as the State with the Market Research Firm which has revised its Highest Fatality Rate of 10% as India crosses outlook for the growth of the FMCG segment 50000 mark in Covid-19 cases- West Bengal. downgrading it from 9-10% to 5-6% for this year Bank whose Licence has been cancelled by RBI due to Covid-19- Nielsen. has become the First Bank to get benefit from India’s Richest Person who has decided to forgo Higher DICGC Cover of Rs.5 Lakh which was his entire Compensation as the company raised from Rs.1 Lakh in the Budget- CKP Co-op announced salary cuts for its employees in the Bank Mumbai. hydrocarbon business- Mukesh Ambani, Chairman of Reliance Industries.
SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 49
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Bank in which loans were given Rs.66000 Crore Indian Exports fell over 60% in April due to more than its deposits in FY 20 showing Lockdown- Worst in 30 Years. disturbing CD ratio and mismatch- YES Bank. Bank which has approved $1 Billion loan to Bank which has approved a $500 million Loan to support India’s fight against Covid-19- World support India’s fight against the Covid-19 Bank. pandemic- Asian Infrastructure Investment Bank. Report according to which the cost of Tribunal which has imposed interim penalty of Coronavirus pandemic could reach as much as Rs.50 Crore on LG Polymers India in the “Gas $8.8 trillion or almost 10% of Global GDP- ADB Leak Incident” in Vishakhapatnam- National Report. Green Tribunal. Index which has fallen to 44.2 in April-June India connects Kailas Mansarovar Route to- quarter from 60.5 in the last quarter- Financial Actual Line of Control between India and China. Sector Sentiments Index. Rating Agency which has predicted that India’s To improve “Ease of doing business”, Govt. Economy will not grow in FY21 due to Deep allowed Indian Public Companies for- Direct Shock caused by Covid-19 and it may grow 0% Overseas Listing of Shares. in FY21- Moody’s. India GDP to contract by 5% in FY 21 as Authority which has ruled that the salary of a predicted by- Goldman Sachs. Director in a company is not liable to be taxed Bank which has launched “Video KYC” for under GST- Karnataka Authority of Advanced account opening- Kotak Mahindra Bank. Rulings. Bank which has been directed by RBI to cut its Prime Minister cited economy, infrastructure, stake in Insurance subsidiaries by 50% or below system, demography and demand- Five Pillars of on or before December16- HDFC Bank. Self-Reliance. Stock Exchanges which have cut Listing Fee for Govt. has made “Arogya Setu Mobile App.”- SMEs by 25%- BSE and NSE. Mandatory for Travel. RBI has refused to give Licences to- NBFCs with Trust from which Govt. decided to allocate Mauritius Investments. Rs.3100 Crore for fight against Covid-19 Entities which have been permitted by SEBI to (Rs.2000 Crore for Ventilators, Rs.1000 Crore for invest additional funds in Govt. Securities and Migrant Labourers and Rs.100 Crore for Treasury Bills- Mutual Funds. Coronavirus Vaccine)- PM Cares Fund Trust. As per CBDT guidelines, Entities which have As per Govt. Decision, Canteens which have to been exempted from certain digital payment sell only Local Products from June-1- modes- B2B Entities. Paramilitary Canteens. Country which sold Bonds with an average yield Report according to which India has moved up below Zero for the First time- Britain. th two positions to rank 74 on Global Energy Bank which has announced $160-bn assistance to Transition Index- World Economic Forum 100 developing countries to fight the Covid-19 Report. crises- World Bank. Report as per which revenue loss for 21 major Country which has passed legislation to bar states in the country has been estimated as Chinese Companies from listing on its stock Rs.97100 Crore in April due to Lockdown- India exchanges- US. Ratings Report. Pension Fund Regulator PFRDA has allowed Bank which has fully disbursed $1 Billion Aadhar-based Paperless KYC process for on- Emergency Assistance loan to India to contain boarding of new subscribers under-National spread of Covid-19- New Development Bank of Payment System (NPS) BRICS. Bank which is to give 7% interest on Savings Pradeep Kumar Dass has been appointed as- Account opened via Video KYC- IDFC First CMD of Indian Renewable Energy Development Bank. Agency (IREDA) As per Govt. Notification, Donations which will Scheme under which the Migrant Workers to get be counted as Corporate Social Responsibility their monthly quota of Foodgrains from any fair (CSR) - PM CARES Donations. Price Shop across the country- One Nation One Paperless Allotment facility has been rolled out Ration Card Scheme. by CBDT for applicants possessing valid Aadhar
SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 50
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Number and having Mobile Number registered Survey according to which “Unemployment rate with Aadhar for getting- PAN. in the country was 6.1% in 2017-18- New Bank which has been monetary penalised by RBI periodic Labour Force Survey. with a fine of Rs.4 Crore for contravention of Index in which India has slipped to 40th position guidelines of Banking Regulation Act- Citi Bank. out of 53 Global Economies- International Sector in which growth recovered 1.3% in Dec Intellectual Property Index. 2019 after remaining in the negative zone in the Onetime Billionaire who has pleaded “Poverty” previous four months- Core Sector. in London Court in his dispute with three Chinese Collections which has reached to Rs.1.1Lakh Banks seeking $680 million in defaulted loans- Crore in January 2020 rising nearly 8% Anil Ambani. compared to Rs.1.02 Lakh Crore in January 2019- Bill which was withdrawn in August 2018 after a GST Collections. backlash on a clause that put the onus on Company which is exempt from tax on income depositors to bail-in, in case of bank failure, is for transactions of crude oil stored in its strategic going to be reintroduced by the Govt. - Financial caverns, provided it replenishes the removed fuel Resolution and Deposit Insurance Bill. within 3 years- Indian Strategic Petroleum Index which has fallen to 83.7, Lowest since Reserves Ltd. (ISPRL). March 2015- Consumer Confidence Index. Turnover which has been increased from Rs.1 Two Indices to be introduced by the Govt. to help Crore to Rs.5 Crore- Tax Audit Turnover. improve the quality of life and civic amenities Scheme in which the Govt. will provide enhanced across major cities in the country- Ease of Living insurance cover with reduced premium for Small Index and Municipality Performance Index. Exporters- Niryat Rin Vikas Yojana (NIRVIK) Bank, for the First Time in India, which was held Scheme by the Govt, would become Private not by M Ajit Kumar, 1984 batch IRS officer, has been disinvestment but Govt. exiting it- IDBI Bank. appointed as- Chairman of Central Board of According to the Business Standard Annual Indirect Taxes and Customs. Awards 2019, “Larsen & Toubro” has been Frauds which have been reported involving adjudged as- Company of the Year. Rs.1.13 Lakh Crore in the first half of current As per BS Annual Awards 2019, “Bhaskar Bhatt, financial year- Frauds in Banks and Financial Former MD of Titan Company” has been Institutions. adjudged as- CEO of the Year. Net savings by Indian Households dropped to Azim Premji, Founder Chairman of Wipro, has 6.5% of GDP in 2018-19- Lowest in last Eight got- Lifetime Achievement BS Annual Award Years. 2019. Shaktikanta Dass, RBI Governor has been named At about 7.5% of GDP, the Revenue-to- by Banker Magazine as “Central Banker of the Expenditure Gap in India is- Highest among Year, Asia-Pacific 2020. Major Emerging Markets. Rating Agency which said that “Economic Business Standard Journalist Somesh Jha has growth projections made in the Union Budget won- Best Business and Economic Reporter appear ambitious given the structural and cyclical Award 2020. challenges facing the Indian economy”- Moody’s Commission for which the Govt. has clarified that Sector in which Index rose to 55.5 –”7-year it “would not give any Permanent Status” to it but High” in January 2020- Services Sector. it will be formed for fixed period as per past Scheme for which the Bill has been introduced in practice- Finance Commission. Lok Sabha to settle the disputed direct tax cases- Top Three Profitable PSUs in 2018-19- ONGC, Direct Tax Vivvad se Vishwas Scheme. IOC and NTPC. India’s Largest Payments Platform which has Top Three Highest Loss-making PSUs in 2018- launched an “All-in-One Android POS Device” 19- BSNL, Air India and MTNL. for merchant partners across the country- Paytm. As per Govt’s decision, name of the National Ranking in which Ace Cricketer Virat Kohli has Institute of Financial Management (NIFM) , retained the Top Slot for the third successive Faridabad has been renamed as- Arun Jaitly year- Celebrity Brand Valuation Ranking. National Institute of Financial Management. Capital infusion of Rs.2500 Crore by the Govt. in three General Insurers ahead of their proposed SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 51
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merger by the end of March is to meet- Supretim Bandyopadhyay has been appointed as- Regulatory Solvency Ratio. Chairman of Pension Fund Regulatory and Chitetsu Watanabe, Japanese Man of 112-years Development Authority of India (PFRDA). old has entered in Guinness Record as- World’s Biocon Chairman Kiran Mazumdar Shaw has got- Oldest Living Man. EY’s Entrepreneur of the Year Award. Indian-origin Politician Rishi Sunak, Son-in-law Cayman Islands has overtaken Switzerland and of Infosys Co-founder Narayana Murthy, has got Top position in the newly released been appointed as- UK’s New Finance Minister. -Financial Secrecy Index FSI2020. Rating Agency S&P has retained India’s Ratings Scheme under which the Govt. has decided to due to Economy’s Weak Fiscal Position as at- make it “Voluntary” for Loanee farmers from Lowest Investment Grade “BBB-” with Stable Kharif 2020 onwards- Pradhan Mantri Fasal Outlook. Bima Yojana (PMFBY) Senior Bureaucrat Rajiv Bansal, presently The First 5G-enabled Handset in India to be Additional Secretary in the Ministry of Petroleum launched by – Chinese Smartphone Maker- and Natural Gas, has been appointed as- CMD of Realme. Air India. Sanjay Kothari, Secretary to President has been Mobile Operator which has been emerged as the appointed as- Chief Vigilance Commissioner. Second-Most Valuable Telco in Emerging Asia behind China- Bharti Airtel. Bimal Julka, currently serving as information Commissioner has been appointed as- New Chief Newspaper which has bagged the “Association of Information Commissioner in CIC. National Exchanges Members of India Award” th for the “Most Diversified Coverage-Newspaper”- India has been placed at 77 Ranking on- Business Line. Sustainability Index. Regulator which issued guidelines that the Company which is the Cheapest Oil and Gas Portfolio Managers can not charge upfront fee Company in the World- ONGC. from clients- SEBI. New Web Form which the Govt. has rolled out to The International Audit Firm which has decided make easier for incorporating a business in India- to stop non-audit services to Public Interest SPICe+. Entities that they audit under the laws and Subsidiary of the Bank which has launched regulations in India- Deloitte Haskins & Sells. “Insta-Demat” facility online in association with Indian Companies now have the option to list NSDL- Canara Bank Securities Ltd. their Global Depository Receipts (GDRs) at the Report according to which, “Two-Third of the International Financial Services Centre (IFSC) World’s Most Polluted Cities” are in India- 2019 Gujarat. World Air Quality Report. IT Service Provider which is shutting its “Free List as per which Mukesh Ambani has been Wi-Fi Programme in India” which was available ranked at 9th position while Amazon Founder Jeff across 400 Railway Stations- Google. Bezos has topped the list- Hurun’s Global Rich Report as per which India has emerged as the List.
World’s Fifth Largest Economy by overtaking the January 2020 UK and France in 2019- US-based Think Tank Rating Agency which has downgraded World Population Review. Renewable Energy Sector from “Stable” to Inflows which has dipped to 11 year Low of “Negative” on rising headwinds- ICRA. Rs.64, 537 Crore till December 2019- Bank which plans to float 42 Billion Distressed Participatory Notes. Asset Fund during 2020 - SBI. London-headquartered Bank which is to shed Company which has been penalised by IRDAI 35000 jobs with aim to cut costs from 2, 35, 000 with fine of Rs.2.18 Crore for violating norms on to 2, 00, 000 only- HSBC Bank. motor insurance service providers- Hero Farmers for whom the Govt. has decided to Insurance Broking India. increase interest subvention from 2% to 2.5%- National Highways Authority of India (NHAI) Dairy Farmers. has started Electronic Toll Collection and issued- Three States in the Country accounted for almost 11.5 Million FASTags. 70% of Solar Installations in 2019 and Karnataka tops followed by- Rajasthan and Tamilnadu. SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 52
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Lead Bank with 15 Consortium Banks has been Bank which has launched an API Banking Portal allowed by a Special Court in Mumbai to which will enable partner companies to co-create liquidate movable assets of Vijay Mallya to repay customer solutions in a faster and simpler debt- SBI. manner- ICICI Bank. Country which has cut Bank’s Reserve Ratio and Bank which has been barred by RBI from released $115 Billion to spur economy- China. carrying out operations such as granting new Vinod Kumar Yadav who assumed office as loans, making investments or accepting new Chairman of Railway Board is likely to be it’s – deposits- Bengaluru-based Sri Guru Raghvendra First-ever CEO of Railway Board. Co-operative Bank. Austria Sebastian Kurz, 33 who formed Coalition Gold Jewellery and Artifacts below 2 Grams have Government is- World’s Youngest Leader. been exempted by the Govt. for- Mandatory Quantas (Australia) has been named in the Asia Hallmarking. Pacific Region as- World’s Safest Airline. Country whose Economy has slumped to its Scheme under which record 87.5% eligible lowest level at 6.1% in 29 years- China. taxpayers have opted for- Legacy Dispute Corporation which has raised Rs.750 million Resolution Scheme. through issuance of Overseas Bonds to fund Central Depository Services Ltd. (CDSL) business expansion plans- Power Finance inaugurated its First IFSC Branch at the GIFT- Corporation. International Financial Services Centre and has Regulator which now holds 625.2 tonnes of Gold become- First Depository. or 6.6% of its Forex Reserves- RBI. Portability which has been rolled out by the Govt. Tax on which the Centre has clarified that the on pilot basis in 6 states and then it is to be lawyers are exempted and there is no move to implemented throughout the country from June 1, impose the levy on them for providing legal 2020- One-Nation One Ration Card Portability. services- Service Tax. India’s largest Payments Platform which has Govt. is to provide universal social security launched its “All-in-one Quick Response” (QR) coverage to unorganized workforce and for this for merchants across the country- Paytm. purpose it is to maintain- National Database for Bank which has celebrated its 109th Foundation Workers in Informal Sector. Day on 21. 12, 2019- Central Bank of India. West Bengal has overtaken Uttar Pradesh and India is proposing to rate its National Highways emerged as - Top Vegetable Production State. on parameters including safety and mobility Exchange which has become the First Exchange among others so as to improve – Quality of to receive SEBI’s approval for launch of weekly Highways Network in the Country. contracts on Interest-Rate-Futures (IRFs)- Bank which has launched a Value-added service Metropolitan Stock Exchange of India. for Religious Bodies, Societies, clubs wherein the International Agency which has slashed India’s users will be able to pay donations and make GDP estimate from 6.1% to 4.8% for 2019-20- other payments- HDFC Bank. International Monetary Fund. Index in which Haryana, Karnataka and Kerala Executive Capital of Andhra Pradesh will be- have topped- State Energy Efficiency Index 2019. Vishakhapatnam. Scheme which the Govt. is to start for the Being member’s contribution, India made the assesses to declare the additional income of the advance payment of Swiss Franc 44, 55, 445 previous five-six years without penalty or (Rs.33 Crore) to – World Trade Organisation. prosecution- Direct Tax Immunity Scheme. Process of printing of the Union Budget starts Stock Exchange which introduced Cross- with – Halwa Ceremony. Margining Facility to offset positions in Stock Exchange which has again become the correlated equity indices- BSE. Leading Market Place Globally for Derivatives By January 2020, all users in India will have to Trading ahead of the US-based Chicago register Drones to regulate their numbers- On Merchantile Exchange- National Stock Exchange. Digital Sky Platform. (NSE). Michael Debabrata Patra, presently ED in Rating Agency which said that the credit risk will Monetary Policy Department of RBI, has been remain high in the country despite recognition of appointed as- Deputy Governor of RBI.
SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 53
Compiled under guidance of NS TOOR CURRENT AFFAIRS
legacy stressed assets and capital infusion by to payment delays by Discoms and tight financing Govt.- Standard & Poor’s. environment- ICRA. Index in which India is having poor ranking and Asia’s 2nd Biggest Cement Company by Market stands at 76th out of 82 Countries globally while Capitalisation- Ultra Tech. Denmark has topped the index- Social Mobility Index. India has slipped 10 places to 51 in 2019 out of 167 Countries globally while Norway has topped the Index- Democracy Ranking Index. Company whose Brand Value has increased nearly six-fold since 2010 to $13.5 billion and made it the “Fastest Growing Brand of the Decade”- TCS. Switzerland has minted a 2.96 millimeter Gold Coin- World’s Smallest Gold Coin. Company on which SEBI has slapped a total penalty of Rs.10.7 Crore relating to manipulation in issuance of Global Depository Receipts- Jindal Cortex Ltd. Study as per which it is revealed that 75% Indians want to continue working beyond retirement age- Study by Credit Suisse Research Institute. Submission of Aadhar/ PAN by Employee to Employer “Mandatory” failing which 20% TDS to be deducted by the Employer- CBDT Forum which has formed the First Global Consortium focused on designing a framework for the “Governance of Digital Currencies”- World Economic Forum. Among UPI (Unified Payments Interface) Apps., while BHIM contributed 6%, Paytm 7% and PhonePe 26%, the maximum contribution of 59% goes to- Google Pay. Bank which has added a new feature that analyses “rogue” apps on user devices that may trigger fraudulent transactions and advises users to uninstall such apps- Paytm Payments Bank. Sunil Mehta, retired MD&CEO of PNB has taken over as- Chairman of IBA. Oxford University Press has named “Samvidhaan”(Constitution) as- Oxford Hindi Word 2019. As per report of Tom Tom Traffic Index, Bengaluru is the- “Most Traffic Congested City in the World” According to Survey in which Assam has emerged as “Top State in formulation of Best Budgetary Practices” – Survey by Transparency International. Rating Agency which revised Wind Energy Sector Outlook from “Stable” to “Negative” due
SCO 32, 2nd Floor, Sector 33-D, Chandigarh Ph. 0172- 2665623, 0988221167 54