December-2016 L Ahalada Rao V

The Council CONTENTS President �l Mamta Binani ISSN 0972-1983 ® vice President �l Shyam Agrawal (Dr.) CHARTERED SECRETARY Members [ Registered under Trade Marks Act, 1999 ] (in alphabetical order) Vol. : XLVI n No. 12 n Pg 1-164 n December-2016 l Ahalada Rao V. l Amardeep Singh Bhatia l Ashish C. Doshi 1. From the President 18 l Ashish Garg l Atul H Mehta l Gopalakrishna Hegde 2. Articles 23 l Gopal Krishan Agarwal l Mahavir Lunawat l Makarand M. Lele 4. Legal World 75 l Rajesh Sharma l Rajiv Bajaj l Ramasubramaniam C. 5. From the Government 85 l Ranjeet Kumar Pandey l S. K. Agrawala l Satwinder Singh 6. News From the Institute 113 l Vijay Kumar Jhalani l Vineet K. Chaudhary 7. Miscellaneous 131 l Yamal Ashwinkumar Vyas

Secretary QR Code/Weblink of Chartered Secretary Journal l Dinesh C. Arora https://www.icsi.edu/JournalsBulletins/CharteredSecretary.aspx Editorial Advisory Board Annual Subscription 12 Chairman inland : Rs. 1000 (Rs. 500 for Students of the iCSi) l S K Agrawala Foreign : $100; £60 (surface mail) Single Copy : Rs. 100

Members ‘Chartered Secretary’ is normally published in the first week of every month. n Non- (in alphabetical order) receipt of any issue should be notified within that month. � n Articles on subjects of l Ashu Gupta (Ms.) n l Deepak Kukreja interest to company secretaries are welcome. Views expressed by contributors are n l D K Jain (Dr.) their own and the Institute does not accept any responsibility. The Institute is not in l D P Gupta any way responsible for the result of any action taken on the basis of the advertisements n n l Gourav Vallabh (Prof.) published in the journal. All rights reserved. No part of the journal may be l G R Bhatia reproduced or copied in any form by any means without the written permission of the l H M Choraria Institute. n The write ups of this issue are also available on the website of the Institute. l N K Jain l Puttaparthi Jagannatham Edited, Printed & Published by l Pradeep K Mittal dr. s.K.dixit for The institute of Company Secretaries of india, l Prithvi Haldea ‘icsi House’, 22, institutional Area, lodi Road, new Delhi- 110 003. l R Radhakrishnan Phones : 41504444, 45341000, Grams : ’CoMPSEC’ l Sanjeev Kapoor Fax : 91-11-24626727 l Tridib Kumar Barat E-Mail : [email protected] Editor & Publisher website : http://www.icsi.edu l S.K. Dixit (Dr.)

Consulting Editor Mode of Citation: CSJ (2016)(12/--- (Page no.) l V. Gopalan design & Printed at legal Correspondent M. P. Printers B-220, Phase ii, noida-201305 l T. K. A. Padmanabhan Gautam Budh nagar, u. P. - india www.mpprinters.co.in CHARTERED SECRETARY I DECEMBER 2016 3 ICSI IMAGES 9 7 1 4 4 5 3 2 6 u u u u u u u u

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Sitting onthedaisfrom Left:CSKVSinghal,MamtaBinani, VineetKChaudhary,CSGSSarin,Nitin KumarandCSManishAggarwal. CS MamtaBinaniaddressing. Chakraborty (GlobalDirector,FrostandSullivan), CSGSSarin,MamtaBinaniandVineetKChaudhary. Startovation –StartupandinnovationSummit, 2016–Dr.RajSingh(RoC,MCA)lightingthelamptomarkinaugurationofStar tovation. OthersstandingfromLeft:Digbijoy Supreme CourtofIndiaandChairman,21 Union MinisterofStateforFinanceandCorporate Affairs). ICSI President’sMeetingwithHon’bleUnion MinisterofStateforFinanceandCorporateAffairs–CSMamtaBinaniseenpresenti ng abouquettoArjunRamMeghwal(Hon’ble Meeting withJustice,SupremeCourtofIndia andChairman,21 ICSI President’sMeetingwithMemberofParliament –CSMamtaBinaniseenwithMeenakshiLekhi(MemberofParliament). others seeninteractingwithPiyushGoyal(Hon’bleMinisterofStateIndependentCharge forPower,Coal,NewandRenewableEnergyMines). Interaction withHon’bleMinisterofStateIndependentChargeforPower,Coal,New andRenewableEnergyMines–CSMamtaBinaniVineetKChaudharyamong Union MinisterofFinanceandCorporateAffairs). Meeting ofICSIdelegationwithHon’bleMinisterFinanceandCorporateAffairs–Seen in thepicturefromLeft:CSVineetKChaudhary,MamtaBinaniandArunJaitley(Hon’ble 8 u A viewoftheinvitees, dignitariesanddelegates. st Law CommissionofIndia)andDr.SSivakumar (Member,LawCommissionofIndia). st LawCommissionofIndia–StandingfromRight CSMamtaBinani,JusticeBalbirSinghChauhan(FormerJustice, 06 09 02 04 DECEMBER 2016 I CHARTERED SECRETARY 07 CHARTERED SECRETARY I DECEMBER 2016 5 4 DECEMBER 2016 I CHARTERED SECRETARY 10 15 14 13 12 11 16-21 u u u u u u 15 13 12 10 ICSI u

CHARTERED SECRETARY Address byCSAnilMurarka, CSSanjayKumarGupta,NitinAmbure (VicePresident,NSDL),CASushilGoyal, CSManojBanthiaandDr.NavrangSaini(DII,DGCoA, MCA). EIRC - 27 (IRS, Jt.CommissionerDept.ofCE&ST,Salem), GuestofHonourPadmavathi(Dty.Commissioner,Deptt.ofCommercialTax,Coimbato re) andCSSolaiyappan. SIRC -SalemChapter–Fulldayseminar onGST–CSCRamasubramaniamaddressing.Otherssittingthedaisfrom Left: CSSanthanamN,ChiefGuestArokiaRaj (Chairman-CII, Mysore),G.V.KrishnaRao(IRS, Commissioner,CentralExcise),R.SundaraRaju(IRS,Joint Excise). Central Excise),A.S.Satish(President-MCCI), S.RajKumar(IRS,Chief Commissioner, Central Excise), SudhakarS.Shetty(VicePresident-FKCCI, Bangalore),Dr. N Muthukumar SIRC –MysoreChapterJointAwarenessProgramme onGST–StandingfromLeft:RamannavarS.S.(Secretary-MCCI),CSBhansali M.C.,RaviKiranEdara(IRS,JointCommissioner, Manish Gupta,VijayJhalani(GovernmentNominee ontheCentralCouncilofICSI),CSAtulMehta,AshishGarg,AkashJain andCSPriyanka. NIRC -TwoDaysRegionalConferenceonPCSEmpower,Emerge&Excel(Host:Agra Chapter)SittingfromLeft:CSAmitGupta,PradeepDebnath,RanjeetPandey, Seen from Left: CS Vineet K Chaudhary (Chairman, Corporate Laws and Governance Committee of ICSI), CS (Dr.) M S Sahoo, AmardeepSingh Bhatia (JS, MCA) and CS Mamta Binani. of FinanceandCorporateAffairs),CSMamtaBinani,VineetKChaudhary(Chairman, CorporateLawsandGovernanceCommitteeofICSI)andTapanRay(Secretary,MCA). CS SantoshKumarAgrawala, CSRajeshSharma(CentralCouncil Member(Govt.Nominee),ICSI)andCSGautam Dugar. Siddhartha Murarka,CS SandipKumarKejriwal,AlokSamantrai (RD, MCA);ManoramaKumari(Member(Judicial), NCLT),CSMamtaBinani,Dr.NavrangSaini (DII,DGCoA,MCA), Insolvency th Regional Conference of Company Secretaries on Governance with Excellence – Release of Quarterly Newsletter of EIRC - Standing From Left: CS Ashok Purohit, CS Professional Agency I DECEMBER 2016 Certificate receiving ceremony – Standing among others from 16 Left: CS Dinesh 14 C Arora, 11 CS (Dr.) 17 Shyam Agrawal, Arun Jaitley 18 (Hon’ble Union Minister 5

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C Ramasubramaniam, CSSivakumarPandJayashree. Meeting ofICSIdelegation withHon’bleLabourMinister,Govt.ofKerala –TPRamakrishnan(Hon’bleLabour Minister, Govt.ofKerala)seeninteracting withCSMamtaBinani, Binani andBGHarindranath (LawSecretary,Govt.ofKerala.) Meeting ofICSIdelegationwithLawSecretary, Govt.ofKerala–StandingfromLeft:CSJeevanVarghese,Suresh,CRamasu bramaniam, CSSivakumarP,Mamta and TomJose(IAS,AdditionalChiefSecretary, Deptt.ofLabour,Govt.Kerala.) Meeting ofICSIdelegationwithAdditionalChief SecretaryofKerala–StandingfromLeft:CSJayashree,Suresh,CRamasubramaniam,SivakumarP,MamtaBinani Varghese, CSCRamasubramaniam,Suresh andPSreeramakrishnan(Hon’bleSpeaker,KeralaLegislativeAssembly). Meeting of ICSI delegationwith Hon’ble Speaker ofKeralaLegislative Assembly –Standingfrom Left: CSJayashree, CS Arun K KAmalolbhavan, CS Ahalada Rao V, CS Jeevan of Industries,Govt.Kerala),CSCRamasubramaniam, CSMamtaBinani,SivakumarP,JeevanVargheseandArunK Kamalolbhavan. Meeting ofICSIdelegationwithHon’bleMinister ofIndustries,Govt.Kerala–StandingfromLeft:CSSuresh,jayashree,RakeshRanjan,ACMoideen(Hon’bleMinister PinarayiVijayan (Hon’bleChiefMinisterofKerala),CSArunKKamalolbhavanandJeevan Varghese. Meeting of ICSI delegation with Hon’ble Chief Minister of Kerala – Standing from Left: CS jayashree, CS Sivakumar P, CS Suresh, CS Mamta Binani, CS C Ramasubramaniam, CS SantoshKumarAgrawala. ICSI ConvocationatEasternRegion–StandingfromLeft:CSSandipKumarKejriwal, MamtaBinani,ChiefGuestGyaneshChaudhary(MD&CEO,VikramSolarPvt.Ltd.)and 20 ICSI President’sVisit toThiruvananthapuram ICSI 21 26 28 22 24 DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 7 6 DECEMBER 2016 I CHARTERED SECRETARY 32-40 29 30 41-43 31 u u u 29 41 31 35

44 u u CHARTERED SECRETARY th Dinesh CArora. – SittingonthedaisfromLeft: CSTusharShah,AshishGarg,(Dr.)ShyamAgrawal,Mamta Binani,CSAshishDoshi,YamalVyasand Curtain raiser to 44th National Convention of Company Secretaries on Powering Governance – Empowering Stakeholders: CS the Governance Professional and ArjunRamMeghwal( Hon’bleMinisterofStateforFinance andCorporateAffairs). Video Messagesby Arun Jaitley (Hon’ble Union Minister of Finance and CorporateAffairs), Suresh PrabhakarPrabhu (Hon’ble Union Minister of Railways) Vijaybhai RRupaniandCSDineshC Arora. Address by: CS AshishCDoshi, CS AshishGarg, CS (Dr.)ShyamAgrawal, Mamta Binani, BimalChoudhary,M M Paranjape, CS(Dr.) M S Sahoo, withHon’bleChiefMinister, Govt.ofGujarat. CS MamtaBinaniinconversation Board ofIndia),MParanjape(MD& CEO,MultiCommodityExchangeofIndiaLtd.),CSAshishCDoshi, GargandCSDineshCArora. Chief Minister,Govt. The InsolvencyandBankruptcy of Gujarat),CSMamtaBinani,(Dr.)MSSahoo(Chairman, R Rupani(Hon’ble Agrawal, Vijaybhai Inaugural Session–Sittingonthedais from Left: CS TusharShah,PrakashP ( Pandya, BimalChoudharyMD,Anmol BuiscuitsLtd.), CS (Dr.) Shyam NationalConventionofCompanySecretaries(November17-19,2016)heldatGandhinagar, Gujarat 36 I DECEMBER 2016 42 37 30 32 38 39 33 43 40 34 7

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Ahmedabad), DeveshBansal(Director, SkipperLimited),SaurabhSoparkar(Sr.Advocate,GujaratHighCourt)and CSSKAgrawala. (Professor, IIM M Lele,JohnE. Partner, IP(ED,VikramSolarPrivateLimited), Dr.RHDholakia Matheson (ManagingPolicyServices LLP),JoySaxena others sitting onthedaisfromLeft:CSMakarand –Yamal AVyasaddressing. Glass to2022–Indiaat75RoleofProfessionals Session –I(Looking Binani. withaTraditionalPagribyCSMamta Vijaybhai RRupanibeinghonoured presenting amementotoBimalChoudharyandCSAshishGarg amementotoMParanjape. a mementotoCS(Dr.)MSSahoo,AshishDoshi and CS(Dr.)ShyamAgrawalseenpresenting Presentation ofMementoes–CSMamtaBinani Address by CS Makarand M Lele, Dr. R H Dholakia, Devesh Bansal, John EMatheson,SaurabhSoparkar,JoySaxenaandCSSKAgrawala. Dr.RHDholakia,DeveshBansal,John Address byCSMakarandMLele, Release of ICSI publications Saathi and Premier on Company Law by Hon’ble ChiefMinister,Govt.ofGujarat. andPremier on CompanyLawbyHon’ble Release ofICSIpublicationsSaathi NationalConventionofCompanySecretaries(November17-19,2016)heldatGandhinagar, Gujarat 49 45 47 51 DECEMBER 2016 52 I CHARTERED SECRETARY 53 CHARTERED SECRETARY I DECEMBER 2016 9 8 DECEMBER 2016 I CHARTERED SECRETARY 59-63 65-66 69-70 67-68 64 58 64 u 54 u 67 59

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CHARTERED SECRETARY Release of ICSI publication titled Guide toTransferPricing. publicationtitledGuide Release ofICSI session. Ashram) andherAssociatesseenconductingthe Yoga Session inAssociationwithMinistryof(Chief YogaTrainer,Sivananda Ayush –SangeetaThawani Address by Gaur Gopal Das and CS SatwinderSingh. Address byGaurGopalDasandCS Singh. and CSSatwinder Das (ISKON,Mumbai) Others sitting fromLeft:GaurGopal Life –CSAtulHMehtaaddressing. Towards Meaningful Session Special Glimpses oftheYogaSessioninprogress. (Director, ProindBusinessSolutionsPrivateLimited)andSachinAghor(OneDelta SynergiesPvt.Ltd.). Singh Ways), Harinder (Passage Ways), JoyRichard & CEO,Passage (Co-founder Chadha Paroon Mathur (Diligent), by Puja – Address B2B Session th NationalConventionofCompanySecretaries(November17-19,2016)heldatGandhinagar, Gujarat 55 I DECEMBER 2016 60 68 56 65 61 57 62 69 58 66 63 70 9

ICSI IMAGES ICSI IMAGES 78 79-85 72-76 86 77 71 10 u u u u 82 78 71 74 ReleaseofICSIpublicationtitledCGCertificationunder ListingRegulations. 44 u u

Purvi DavepresentingamementotoRajesh Sharma. Chadha (Co-founderandCEO,Passageways) andCSMahavirLunawat. C, Pramod Mulani (Head, Product and Digital Initiative, NSDL), Rajesh Sharma (Govt. Nominee on the Central Council of the ICSI), CS Pavan Kumar Vijay, Apurva Mehta, Paroon Session III-(PanelDiscussiononDigitalDrive –EmpoweringKnowledgeEconomy)ReleaseofICSIPublicationtitledRiskManagementStandingfromLeft:CSRamasubramaniam Ashok Barat(ChiefOperatingOfficer,CyrilAmarchandMangaldas),CSMamtaBinani, Sunil Mathur(MD&CEO,SiemensIndiaLtd.)andCSRanjeetPandey. Session II – Panel Discussion (CEO’s Speak – Emulate Governance from Corporate Leaders) – Standing from Left: CS Ahalada Rao V, Uday Khanna (Chairman,Bata India Ltd.), Address byRajeshSharma,CSRamasubramaniam C,PramodMulani,CSPavanKumarVijay,ApurvaMehta,ParoonChadhaand CSMahavirLunawat. Address byCSAhaladaRaoV,UdayKhanna,AshokBarat,SunilMathurandRanjeet Pandey. th NationalConventionofCompanySecretaries(November17-19,2016)heldatGandhinagar, Gujarat 83 75 84 76 85 79 77 86 DECEMBER 2016 72 80 I CHARTERED SECRETARY 73 81 CHARTERED SECRETARY I DECEMBER 2016 11 10 DECEMBER 2016 I CHARTERED SECRETARY 93-95 92 91 90 96 88-89 87 u u u u u 93 96 87 91 InteractivesessionforMembersofICSI withCouncilMembers–Aviewofthedais. AddressbyGautambhaiNavalchandShah. RunforacauseCSBFinassociation withMinistryofAyush–GautambhaiNavalchandShah(Mayor,AhmedabadMunicipalCorporation) seenwithMembersICSI. PresidentICSIpresentingamemento toYuvrajSMJadeja. 44 u u Glimpses ofrunforacauseCSBF. Address byYuvrajSMJadejaandCSGopalakrishna Hegde. CHARTERED SECRETARY Session IV–LearningfromtheExperienceofRoyalMajestiesSittingfromLeft:Yuvraj S MJadejaofRajkotandCSGopalakrishnaHegde. th NationalConventionofCompanySecretaries(November17-19,2016)heldatGandhinagar, Gujarat I DECEMBER 2016 94 88 89 92 90 95 11

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NationalConventionofCompanySecretaries(November17-19,2016)heldatGandhinagar, Gujarat

Grade Aand A+categoriesrespectivelyfromthe Chief Guest. in Grade D,GradeC,B, best Chapteraward receiving Chapter representatives Indore andHyderabad Bhubaneswar,Nagpur, Visakhapatnam, Address by:VinayKSaxenaandSmriti ZIrani. U KChaudhary,VijayJhalani(Govt.NomineeontheCentralCouncilof ICSI)andCSRajivBajaj. Krishna Agarwal(Govt. Nomineeonthe Central Councilof the ICSI), Dr. P D of Vagela (Commissioner,Commissionerate CommercialTax), CS (Dr.) Others sittingonthedaisfromLeft: addressing. Gopal CS VineetKChaudhary the WayBeyondCompliance)– Skills –Finding Session V(Enhancing Smriti ZIrani. Award fromtheChiefGuest Council the BestRegional receiving and ChapterAwards–NIRCrepresentatives Council of BestRegional Prize distribution CS MamtaBinaniinconversationwith ChiefGuestSmritiZIrani. KVIC, MinistryofMSME),CSMamta Binani, ChiefGuestSmritiZIrani(Hon’bleUnionMinisterofTextiles),CSAshish GargandCSDineshCArora. Closing Plenary : Sitting on the dais from Left: CS Tushar Shah, CS Ashish Doshi, CS(Dr.) Shyam Agrawal, Guest of Honour Vinay K Saxena (Chairman, CS ChetanPatelpresentingamemento toDr.PDVagela. Address byGopalKrishnaAgarwal,CS(Dr.)UKChaudhary,VijayJhalani andRajivBajaj. 105 103 109 106 98 107 99 DECEMBER 2016 110 100 I CHARTERED SECRETARY 101 CHARTERED SECRETARY I DECEMBER 2016 13 12 DECEMBER 2016 I CHARTERED SECRETARY 114 113 117-119 116 115 119 116 114 111 u u u 44 u

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NationalConventionofCompanySecretaries(November17-19,2016)heldatGandhinagar, Gujarat Appearance ofAmeeshaPatelinculturalevening andglimpsesofculturalprogrammesconductedattheConvention. Hyderabad ChapterrepresentativesreceivingtheNationalBestaward fromtheChiefGuest. Meenakshi DattaGhosh(IAS,Retd.,Former SecretarytoGovt.ofIndia)announcingthenamesafterdrawlotsforfreeparticipationinICGDprogrammeInstitute. CS MamtaBinaniand(Dr.)ShyamAgrawalpresentingamementotoSmritiZIrani. CS AshishDoshipresentingamementotoVinayKSaxena. I DECEMBER 2016 117 112 115 118 113 13

ICSI IMAGES 44th National Convention of Company Secretaries (November 17 - 19, 2016) held at Gandhinagar, Gujarat

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120 u A view of some of the stalls set up at the Convention venue.

121-123 u Glimpses of distinguished invitees, dignitaries and delegates attending various sessions of the Convention.

124 u Group photo of team ICSI with President, Vice President and Council Members of the Institute.

14 DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 15 14 DECEMBER 2016 I CHARTERED SECRETARY O T T oriented approach. the stakeholder approach by a corporate and not a charity an actionablebusinessagenda. CSRagendashouldcarry part ofcompanystrategyand budgetandbetreatedlike be thatofparticipatoryand not acontributory.Let,CSRbe time toensurethatwhiledealing withCSR,approachshould attitude fortakingCSRinits right perspective.Now,it’s future lessons that can be helpful for sharpening the overall certain by since CSRisinthelargerinterest,implementationofsame overall needfortheholisticgrowthanddevelopmentofIndia, the cornerstoneofmodernconcept-CSR.Lookingto the Theory of“Trusteeship”coinedbyLateShriMK.Gandhi is Hemant Gupta Hemant Present and the Future CSR in theIndian Context – thePast, Bhavesh A.Kinkhabwala CSR – Rethinking the phenomenon Dube Dr. Indrajit Shift inDecolonized Company Law Philosophical A Responsibility– Statutory CorporateSocial Indian CorporatesfromaCSR/CSDperspective. concludes withthekeyfactorsthatdrivedecisionmakingin CSR andtheshifttoCorporateSustainableDevelopment.It on IndianCSR.Thearticlethenmovestomaturingof Indian global CSRlandscapearealsotracedalongwiththeirimpact making Indian CSR more inclusive. Parallely, developments in the CompaniesAct2013wasakeydriverinchangesand towards CorporateSocialResponsibility.Itdwellsuponhow and global Corporate philanthropy and the paradigm shift The articlestartswithastructuraldescriptionoftheIndian outlines them both from an Indian andaGlobal context. Development. Itdescribeskeydriversforthisjourneyand for formalizationofCorporateSocialResponsibilityinIndia. Articles compulsion initial days of Philanthropy to Corporate Sustainable he articletracesthehistoryofIndianCSRrightfrom and itisnotaconceptborrowedfromtheforeigncountry. rigin ofCSRcanbetracedfromtheancientscriptures economic modelofIndiaalsohighlightstheattemptsmade he article while explaining the reasons for transformation of CHARTERED SECRETARY extent. PART-1 :Articles onsoaAu dit &CSR through ISO certification legal I DECEMBER 2016 compliance and CSR seems standards justifiable P-23 are P-25 P-33 P-28 the to S C C normal courseofbusiness. activitiesundertakeninpursuanceof ongoing), excluding its Policy, as projects or programs activities(eithernew bythecompany,asperitsstatedCSR be undertaken shall communities, andotherstakeholders.TheCSRactivities activities related to the environment, consumers, employees, the company’s through impact a positive encouraging and responsibility as embracing (CSR) canbedescribed and operations. Whereas corporatesocialresponsibility helping andthecommunitywhile suppliers, regulators,themedia, with investors,customers, relationships and advance transparency and greater disclosure;this can helpamend A social auditcansatisfy stakeholder demandsfor increased performance. report on,andimprovetheirsocialresponsibility to understand, choose companies There aremanyreasons accountability. social including to improvingstrategicplanning, to demonstrateitscommitment for anorganization approach an objective provides audit Thesocial it byitsstakeholders. of expected responsibilities social ethical, andphilanthropic towards theupliftmentofsocietyandenvironment. Dipti Shah Dipti Social Responsibility Social Audit and Corporate Kausik Nath not charity, but aresponsibility Corporate Social Responsibility is Jain & Karuna Jain Komal People and Planet Corporates towards Prosperity of Priceless Contribution of Corporate Social Responsibility - corporates have nowbecomestrategic.So fromatickthe aside which mandates wealthycorporatesto Responsibility” set action byintroducingtheconceptof“CorporateSocial therefore ourlegislatorsthoughtof adopting retaliatory to citizensandenvironment, damage wascaused irreparable and progressive industrialization, and With globalization spirit. true letterand in adhered are that CSRissues ensure should KMP ofthecompany secretary being Company for professionals. opportunities and scope in abundant brought business’s and reportinga is theprocessofassessing ocial auditing voluntary and more of a philanthropic exercise for exercise of aphilanthropic more and voluntary was earlier (CSR) which Responsibility Social orporate provision of CSR underCompaniesAct, 2013 has many phasesinIndia.Mandatory through SR hasgone some these part stakeholders performance of their profits better

in to fulfilling compensate understand the economic, the and firm’s contribute 15 P-48 P-43 P-38 goals legal,

AT A GLANCE AT A GLANCE S W impactful CSRactivities. CSR forundertaking audit under of social focuses onrole same – frameworkforCSRimplementation sound operating formulate Effective CSRauditseekstohelp accordingly. organization and to suggest appropriate remedies the environmental,socialorgovernancerisksfacedby has beenfelt to conduct socialauditof CSR for identifying CSR Policy,aneed of reporting obligation its compulsory CSR committee to monitor theCSRpolicyof company and Bharatsinh Chandrasinh Parmar Chandrasinh Bharatsinh Responsibility in India Enforcement of Corporate Social Contemporary Statutory Efficacy of Social Audit in Gupta Meenu Responsibility Audit of CorporateSocial 16 CSR projects,theresultantadvantages, etc. Audit, CSR,the value of Social Audit as a tool toappraise context, this article aims to understand the concepts of Social an instrument called social audit can be very useful. In this CSR their the relevant companies in India do design and implement stakeholders. In compliance with the statutory requirement, values and operations to improve the welfare of society and integrate social,environmentalandeconomicconcernsinits Social Responsibility(CSR)isastrategyofcompanyto of discharging itssocialresponsibilitiesandmeetingtheneeds to checkhowwellanorganizationhasperformedin manner. to doitinastrategic,systematicandthoughtful challenge well asto the societyat large. Corporateshaverisento the benefits the CSR, since in more spend would India in corporates a societyalongwiththegovernment.Asyearsgoby, build and notcharity.Itto is moreofacollectiveresponsibility world.It success inthemodernbusiness isaresponsibility for reputation. CSRisnowavitalcomponent company’s capital andresourcestoservethesocietybuilda box exerciseitisnowinvestingcorporate’shardearned the

CSR of an organization towards the society. It is conducted of an organization towards the society. It is conducted ocial Audit is an instrument to gauge the contribution reach Social Responsibility rules and the constitution of and theconstitution rules Responsibility Social Act, ith theCompanies 2013mandatingCorporate targeted as of initiatives. is to strategic done the beneficiaries beneficiaries under However, CSR are the of to for twofold, financial a check whom given how for they project. audit. the far were the corporate The benefits Corporate designed, P-51 P-55 article as of

S S T made overthem”. to carry out Audit of “such CSR Activities & the expenditure in thisdirection the FinancialYear2014-15andnecessity made out theactualprogress Article makesanattempttobring Act, 2013.Thepresent enacted insection135oftheCompanies its discharging SocialObligations. This provision hasbeen them tocomeforward&helptheGovernment in compelling certain companies, of involving rightly enactedtheprovision has issues, theGovernmentofIndia with environmental lower levelof education, widedisparityof income, etc. coupled & povertylevel, high population of Indiaparticularly problems particularly athe country likeIndia.Consideringinherent its own withoutthe help of any Non-governmentorganisations, functions on welfare all itssocial the Governmenttodischarge it hasindirectlybeenenforcedbytheCompaniesAct,2013. has beenmadetoenvisagethemeaningofsocialauditandhow comprehensive ISO26000standard.Inthisarticleanattempt social responsibilitycomponents.CSRauditisbasedonthe Social Audit in the Context of CSR R Parthasarathy Companies Act, 2013 Social Audit under S. Rajarathinam need forSocialAudit Social Responsibility of Enterprises C.B.Prabhumirashi accounting relationships, Community development, diversity, environment, international have regarding the social and environmental responsibilities. the businesstomeet expectations the stakeholder groups objectives. Itevaluatesmeasurablegoalsintendedtohelp companies sector canbeanalysedinterms ofthedegreetowhich become a global issue. Public accountability ofthe corporate four etc.). etc.). Society andtothelocalcommunity.(e.g. environment,pollution responsibility totheshareholders d)Socialresponsibilitytothe b) Socialresponsibilitytotheir ownemployeesc)Social

identified Corporate on Corporate Social Responsibility (CSR) Corporate onSocialResponsibility(CSR) ocial Auditisanassessmentoftheperformancea accountability of corporate enterprises which have of late accountability ofcorporate enterprises whichhaveoflate he articlegivesmoredetailsof theaspectssocial play ocial Audit in the context of CSR activitiesinIndiawill a have and very marketplace areas:- financial fulfilled pivotal DECEMBER 2016 a) Social their role. monitoring practices, social Nowadays responsibility I CHARTERED SECRETARY obligations fiscal are commonly it responsibilities, is to very in the the consumers difficult assessed following P-68 P-63 P-60 and

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CHARTERED SECRETARY I DECEMBER 2016 17 16 DECEMBER 2016 I CHARTERED SECRETARY “U n n n n n n n have beenprovidedandhighlightedinthisArticle.” collection anddepositofTaxatSourcetakingcreditthereof been introduced. Various provisions regarding theirliability of Agarwal Dr. Sanjiv Aggregators of GSTonE-Commerce& Levy reporting bytheSecretarialAuditors. by a followed Report Annual their in performance social their to highlight will maketheenterprisesstatutorilyresponsible Act, 2013 made intheCompanies that theprovisions It ishoped

Legal the FirstRespondent.[SC] rums, StateCommissionand NationalCommission. prove the functioning and administration of consumer fo- LW: 78:12:2016SupremeCourtissuesdirections toim- gives securityforthesaidamountofRs.418crores.[SC] the principalsumofRs.418croresinvestedbyFMO,or fend thesuitonlyifitdepositsinBombayHighCourt In ouropinion,thedefendantwillbegrantedleavetode- raised asubstantialdefencetotheclaimmadeinsuit. LW: 77:12:2016Itcannotbesaidthatthedefendanthas LW: 76:12:2016 of 1960.[SC] the provisionscontainedinSection187ofTripuraAct by thebankforrealisationofitsduesthatwillprevailover gory ofpersonstowhommortgagedpropertycanbesold of 2002,whichdonotcontainanyembargoonthecate- LW: 75:12:2016 It is the provisions of the SARFAESI Act as turbed LW: 74:12:2016 The High Court ought not to have dis- States toimpose entrytax.[SC] Supreme Court upholds thevalidity of the power of the LW: 79:12:2016 Nine Judge ConstitutionBench of the [SC] LMJ: 14:12:2016Sharesarenotgoodsbeforeallotment. tion 11(2)ofFTDRAct,1992.[Del-DB] the penaltyinexerciseofpowersconferredbySec- cannot besaidtohavecommittedanyerrorinimposing produce requireddocuments.Therefore,therespondents the respondents that the appellant/writ petitioner failed to CHARTERED SECRETARY they “aggregator” and “Electronic commerce operator ” have “aggregator” and“Electroniccommerceoperator”have nder the provisions of the Model GST ACT , terms like the WORLd were findings not PART-2 :ARTICLE onGST in A in challenge categorical favour I DECEMBER 2016 of in finding the the Second Writ was Petition recorded Respondent P-75 filed P-71 by by • • n n n n • • • • • • • • • • • • n n n n n n n ClarificationRegardingFilingofOfflineChallanswithIEPF NotificationofSickIndustrialCompanies(SpecialProvisions) FROM THE other two yearsormoreundertheCompaniesAct,2013. offences punishablewithimprisonmentof Special Courtforthepurposesofprovidingspeedytrial Authority underCompaniesAct. Resolution ProcessForCorporatePersons)Regulations,2016 Insolvency andBankruptcyBoardOfIndia(Insolvency Professionals) Regulations,2016 Insolvency andBankruptcyBoardofIndia(Insolvency Professional Agencies)Regulations,2016 Insolvency andBankruptcyBoardofIndia(Insolvency Regulations, 2016 and GoverningBoardofInsolvencyProfessionalAgencies) Insolvency andBankruptcyBoardofIndia(ModelBye-Laws Repeal Act,2003 National AdvisoryCommitteeonAccountingStandards Amendments toScheduleIIoftheCompaniesAct,2013 Readers’ Write Readers’ Report oftheBoardDirectors forPublicComments and on Dividend Standards Drafts ofSecretarial Exposure Secretaries ary companyanditsemployees.[Del-DB] sary orproperpartytothelitigationbetweensubsidi- cause of the fact that it is a holding company, be a neces- LW: 81:12:2016Theholdingcompanywouldnot,be- dealer.[SC] levied beforedeductingtheamountofentrytaxpaidbya of surchargeunderSection5AtheOSTActistobe Rules, weareoftheconsideredopinionthatamount OST Act,Section4oftheOETActandRule18 LW: 80:12:2016onaconjointreadingofSection5the Proceedings of 44 Proceedings CG Corner GST Corner Corner Ethics &Sustainability CSBF Revolving FundSchemesfor becoming lifemembersof Members Certificate of Practice fee for Associate andFellow Membership fee,EntranceFeeand in theAnnual Revision News Regional Imparting Training List of Practising Members/Companies Registered for Company SecretariesBenevolent Fund Licentiate ICSI Admitted Certificate ofPracticeIssued/cancelled Members Admitted/Restored hig GOVERNMENT hligts th National Convention of Company of Company Convention National P-113 P-85 17

AT A GLANCE FROM THE PRESIDENT O notes a non legal tender andmakingitapiece ofpaperfrom notes anonlegal wealth. The stunning rulingof the Government to declare these 20-25 percentofit is inthe form of blackmoneykeptas cent of cash is in the form of 500 and 1,000 notesandaround in amass. AsinIndia,morethan80per money andgrowing developed a symbiotic mutualistic relationship with black in duetothisand dowry andmanymoreevilshavecreeped expenses, Swissbanksdeposits,election cash transactions, unaccounted laundering, money hawala, transactions, benami system illegal acts similar to blood inthebody.Corruption, withsobriety.Cashcurrency in this development national hindering and huge drastically hasbecome economy parallel economy of black moneyisinexistencesincelong.This with ourreallegaleconomicstructure,ashadow In India,along system. Nation’s economic the cleansing in way a long go will notes counterfeit and money that the resolveof our Governmentagainstcorruption,black As anInstitute,wefirmlybelieve and poorinparticular. general Black Moneyfor the economic developmentof the Country in Rs. 500currencynotes,inordertorootoutthemenaceof Rs. 1,000and to demonetize and historicaldecision breaking Shri NarendraModiJiforhisstupendous,daring,path Esteemed ProfessionalColleagues 18 You arewhatyourdeep,drivingdesireis.Asis,soiswill.will sois congratulations to Hon’ble Prime MinisterofIndia, to Hon’ble congratulations Team Members of the ICSI, we extendourheartiest n behalfof the ICSI, Council Members,Studentsand your deed.Asdeedis,soisdestiny. â ØÍæ·¤æ×ô ÖßçÌ Ìˆ·ý¤ÌéÖüßçÌÐ ÖßçÌ ØÍæ·¤æ×ô â Øˆ·¤×ü ·é¤L¤Ìð ÌÎçÖâ´ÂlÌðH ·é¤L¤Ìð Øˆ·¤×ü Øˆ·ý¤ÌéÖüßçÌ Ìˆ·¤×ü ·é¤L¤ÌðÐ Ìˆ·¤×ü Øˆ·ý¤ÌéÖüßçÌ ·¤æ××Ø °ßæØ´ ÂéL¤á §çÌÐ ÂéL¤á °ßæØ´ ·¤æ××Ø I toknowthatthisissue ofChartered am alsopleased old moneyinthesystem. just newmoneyreplacing with newsecurityfeatures, ensuringmuchmorethan designed notes havebeen to carry.Besides, thenew convenient crime becauseit is anonymous andbigcurrencyismost the cost of transactions. Cashgreasesthewheelsof illegal is toelevate shock this exogenous behind idea The elementary economy, weshouldaimtogo‘less-cash’,andnot‘cash-less’. On the sametime,it is pertinentto mention that as an money andcorruptioninIndia. therefore, to make crediblethethreatofonblack a clampdown piled througha number of means. It was most apropos time, were givenawindowof opportunity to declare theirwealth followed the Income DisclosureScheme2016,wherepeople (PMJDY) inIndia.ThismovebythePrimeMinisterhasalso with massiverolloutofthePradhanMantriJan-DhanYojana hindsight in seems clearly of thisannouncement The timing tomakeitasuccess. Government/s havejoinedhands of world isnota cake walk.But this time, people, Banks, such ahugequantityofnotesinonethelargesteconomies of Replacement 7.5 billion. 1,000 notestobearound while 500 notesineconomyisestimatedtobearound16.5billion property etc. As perDeputyGovernorofRBI, the numberof notes, gold, currency other into or conversion laundering immediate effecthassnatchedawayscopeofmoney DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 19 18 DECEMBER 2016 I CHARTERED SECRETARY November 17-19, 2016. This Convention witnessed wondrous witnessed 2016.ThisConvention 17-19, November Gujarat from at Gandhinagar, The RoleofCSProfessionals” Stakeholders: Governance-Empowering theme: “Powering of CompanySecretariesonthe Convention our 44thNational convenience etc. we arepleased to share that we organised of infrastructureandsetting up ofbusinesswitheaseand ofservices,jobcreation,development delivery judicious such aspovertyelimination,agriculturalreforms, transparency, country, weneedtoonthechallenges initiate deliberations of our anddiscusstrueempowerment In ordertodeliberate Company Secretaries 44th NationalConventionof Submission ofSuggestions/Representations hearted our whole to extend no stoneunturned and leave the nextlevel together’. We are determinedto take our reveredprofessionto ‘Growth isneverbymerechance;ittheresultofforcesworking Meeting withDignitaries of Novemberhereunder: in the month of ICSItowardsexcellence to thevoyage you all Movingahead,Iwillnowtake is reallypromising. contributions of as thequality base ofourreaders the knowledge enriching Ifindthisthemetobeveryaptand Social Responsibility. Audit andCorporate focus onSocial Secretary hasitsspecial • StateofKerela Sh.B.GHarindranath, LawSecretary, • Dr.SSivaKumar, Member,LawCommissionofIndia • Draft • DraftMedical DevicesRules, • representations on: esteemed members, ICSI submitted its suggestions and for our opportunities professional With aviewtoexplore Justice • Sh. • Sh.Pinarayi Vijayan,Hon’ble • ofPower Sh.Piyush Goyal,Hon’bleMinister • Sh. • month ofNovember: in the dignitaries met following ICSI representatives objective, Sh. • Sh. • Draft • State ofKerela Sh. Tom JoseIAS , Chief Secretary - Department of Labour, Kerela Interconnection (AddressableSystems)Regulations,2016 Corporate AffairsandFinance Corporate Affairs of Kerela Commission ofIndia XII-EB oftheIncome-TaxAct,1961 market valueinrespectofthetrustorinstitution-Chapter CHARTERED SECRETARY T. A.C Arjun Arun support Telecommunication Rules P (Dr.) Moideen, Ramakrishnan, Jaitley, Ram for in Balbir prescribing flagship Meghwal, Hon’ble Hon’ble Singh I DECEMBER 2016 (Broadcasting Hon’ble Government Minister the Union Hon’ble 2016 ChiefMinisterofKerala Chauhan, method Minister Minister of Minister initiatives. and Industries, of Chairman, of valuation Cable of Labour, of Finance Services) State With State of State

Law this fair for of &

to realthisopportunity toexcelinthisarea. IBBI has also introduced examinations, I request our members Advocates who are in practice for A minimum period of 15 years. Secretaries, Chartered Accountants, Cost Accountants and begin with, this registration canbe availedbyCompany Agency has already started enrolling professional members.To Insolvency Professionals.TheICSIProfessionals tremendous professionalopportunitiesforitsmemberstoact as and Individualinsolvencyresolutionprocess.TheInstitutesees Insolvency Resolution Process, Corporate Liquidation Process ocean ofopportunitiesfortheprofessionalsinareaCorporate and theRegulations/Rulesmadethereunderhasopened an The NotificationofInsolvencyandBankruptcyCode,2016 Minister Sh.ArunJaitleyon28November,2016inNewDelhi. Affairs Corporate and Finance Union ICSI bytheHon’ble • • • • • • • • • • • Certificate 2016. TheRegistration Agencies) Regulations, Professional Agency (IPA) Professional undertheIBBI (Insolvency to actasInsolvency Agency’ Professionals ‘ICSI Insolvency to registration (IBBI) hasgranted of India Board Bankruptcy We arehappytosharewithyouthatTheInsolvencyand InsolvencyProfessionals Agency ICSI • • were released: publications valuable commemorate thisConvention,following Khadi andVillageIndustriesCommission,Guest of Honor. To Chief Guest along withSh. Vinai KumarSaxena,Chairman, Smt. UnionMinisterof Smriti ZubinIrani,Hon’bleTextileas The Valedictory Sessionwitnessedthe cordial presenceof graced theeventasGuestsofHonor. Biscuits MD &CEO,Anmol Chaudhary, Sh. Bimal and Limited India; Sh. Mrugank M. Paranjape, MD & CEO of MCX of India The InsolvencyandBankruptcyBoardof Sahoo, Chairman, R. Rupani.CS(Dr.)Madhusoodan of Gujarat,Sh.Vijaybhai Chief Minister Session wasHon’ble The ChiefGuestofInaugural of thecountrytowidentheirhorizonknowledge. in fromallparts whorolled delegates of precious participation Secretaries of Company Convention – 44thNational Souvenir Technical Analysis A Comparison Act, 2013: and Companies 2015 SEBI (LODR)Regulations, Governance AToolforGoodCorporate Risk Management: Independent Directors–AHandbook Handbook onArbitration,ConciliationandMediation Guide toTransferPricing E-learning ModuleonBankingTerminology Delisting ofEquityShares:LawandPractice Cyber Crime:Law&Practice CS Sathi:AReferencerforCorporateLeaders Regulations: AReferencer Corporate Secretaries inLabourLaws Opportunities for Challenging PracticingCompany of IPA Governance as a Section Certification 8 Company was under awarded 19 Listing to

FROM THE PRESIDENT E-book on Companies Act, 2013 conceptualized the idea of having a day declared as Technology has two faces. We all feel it, but sometimes can’t “International Corporate Governance Day”. As an important find words to describe it. E-books are the best example to show initiative, and to profess and create international consensus for the 0-1 nature of emotions the technology evokes. Keeping in “International Corporate Governance Day”, the Institute is view, the ease provided by technology in the modern world, the hosting its first ever Global Congruence on 8-9 December in Institute has launched an e-book portal on updated Companies the city of Hyderabad to promulgate International Corporate Act, 2013. The features of this e- book portal include: Governance Day. Updated Sections and Rules in view of recent MCA Notifications, Circulars and RODs • 1st Weekend Management Skills Orientation • Arrangement of Sections and Rules under appropriate Program (WE-MSOP) Chapter heads The Co-founder of Google, Larry Page believes in “Always Chronological arrangement of all Notification, Circulars, deliver more than expected.” We fathom the limitations of Orders & Clarifications • our professionals who are not able to spare time for full time Date wise search facility of all Notifications, Circulars and participation in MSOPs. Keeping this in view, a special Weekend Orders • Management Skills Orientation Program (WE-MSOP) for Senior Specified links in text of Section with the Rules Professionals having passed the Professional examination of the linking of Sections with MCA Notifications, Circulars and Orders FROM THE PRESIDENT • Institute, but not able to join MSOP at a continuous stretch of 15 Search Engine for Rules and Sections • days, has been introduced by the Institute for the very first time. This e-book was launched at the National Convention and has • been hosted on the website of Ministry of Corporate Affairs as it Exposure Drafts of Secretarial Standards is a joint initiative and also on ICSI website. This can be availed The exposure draft of Secretarial Standard on ‘Dividend and without any cost and is a gigantic step towards bringing in ease Secretarial Standard on Report of the Board of Directors’ were of reference to the Act. hosted on our website soliciting valuable views and suggestions ICSI Company Law Premier from the stakeholders. We are completely aware that Company Secretaries in practice and employment must sharpen their axe from time to time. 16th ICSI National Awards for Excellence Therefore, ICSI has come out with a unique and innovative in Corporate Governance and 1st ICSI CSR publication on Companies Act, 2013, “ICSI Premier on Excellence Awards Company Law”. The takeaways from the book will be a treasure Every year, the Institute recognises the Best Governance forever, as it will not prove to be a helping hand to a person Practices amongst the Indian Corporates through its National in gaining understanding on the subject, but, will also provide Awards for Excellence in Corporate Governance. This year, deep insights after reading the Commentaries and Case Laws. the Institute has also initiated CSR Awards. The presentation This book is a must possess for each desk, popularly known as ceremony of the 16th ICSI National Awards for Excellence in ‘blue book’ has also been launched at the National Convention. Corporate Governance and 1st ICSI CSR Excellence Awards is scheduled to be held on 24 December, 2016 at Vigyan Compliance Management and Audit Bhawan, New Delhi. The meeting of the eminent Jury chaired Configuration (CMAC) Software for Members by Hon’ble Justice Shri V N Khare, Former Chief Justice of With a view to facilitate our esteemed members, the Institute India was held on 27 November, 2016 for finalising the has got developed a tool for facilitating conduct of Secretarial awardees of the 16th ICSI National Awards for Excellence in Audit ‘Compliance Management and Auditing Configuration Corporate Governance and 1st CSR Excellence Awards. (CMAC)’ having checklists for around 35 Industry Verticals and 50 Industry sub-verticals. Further, a detailed checklist of Start-O-Vation Punjab applicable laws covering the Central and State Acts has been The Institute collaborated with Indian Chamber of Commerce made available in downloadable form to act as a ready reckoner as Strategic Knowledge Partner in Startup and Innovation for Compliance Management in Companies. In the first phase, Summit, 2016 titled “Start-O-Vation” organized on November all Manufacturing and Services Industry Laws are available in 29 at Chandigarh. The Summit had deliberations on guiding the tool covering more than 400 Acts and Rules etc. the entrepreneurs to build a strong base in terms of financing, leadership and strategies. The Ministry of Corporate Affairs were Global Congruence to promulgate gracious to put up a big pavilion in the event which was manned by International Corporate Governance Day the officials of ICSI, where the concepts of OPC, small company, With the current global changes and with the objective to SPICE, incorporated body etc. were explained to the start-ups re-iterate and create further sensitization with respect to and reading material and pamphlets were also distributed to the adoption of Good Governance practices, the Institute has participants both in English and Hindi languages.

20 DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 21 Vigilance Awareness Week, 2016 done it, you feel you can do anything.’ A unique event “Run The Institute was invited to participate at the National Seminar for the cause of CSBF”, for promotion of the cause of CSBF, addressed by the Hon’ble Prime Minister of India in its was organised at the Sabarmati Riverfront, Ahmedabad on Valedictory Session on the occasion of Vigilance Awareness during the last day of National Convention for promoting the Week, 2016 organized by Central Vigilance Commission on philanthropic cause of CSBF witnessing the zestful participation November 7 at Vigyan Bhawan, New Delhi. The programme from esteemed members. Sh. Gautambhai Navalchand enriched the awareness of the participants in deliberations Kishore, the Mayor of Ahmedabad Municipal Corporation, the during technical sessions on “Public participation in promoting Chief Guest of this event flagged off the run. Ministry of Ayush integrity and eradicating corruption” and “Public Procurement”. was the co-host for this zestful event. A session on Yoga was also hosted on this occasion. Knowledge Series on GST It is the supreme art of the teacher to awaken joy in creative Propagation for Enrolment to CSBF expression and knowledge- Albert Einstein. The Institute ‘He that does good to another does good also to himself’ - collaborated as an Associate Partner with PHD Chamber for Lucius Annaeus Senec. In the month of November, 64 new conducting second Knowledge Series on Goods & Services members enrolled for the CSBF Fund. We are trying our level Tax. In the month of October, two full day seminars in this best to circulate information concerning enrolment to CSBF via series were conducted on November 17 and 24 to analyze SMS, emails etc. with a view to apprise members of increment detailed provisions under GST vis-à-vis the provisions under in financial assistance w.e.f. January 1, 2017 in case of sad FROM THE PRESIDENT existing Indirect Tax regime. demise of any life member of CSBF. I request all esteemed members to enrol themselves for CSBF. We introduced the CS Olympiad scheme of ‘Each One Get One’ and this has really picked After successful completion of two phases of CS Olympiad, up well. I once again mention that the increment of financial next phase of CS Olympiad was conducted on an International assistance is from Rs. 5 lakh to Rs. 7.50 lakh. platform in more than 10 Schools in Gulf Region, Bhutan, Srilanka, Singapore, Uganda etc. Besides, the result of CS ‘CS Touch’ Mobile App revamp Olympiad has also been declared. Muskan Yadav of RPS The Institute had launched ‘CS Touch’, a Android based mobile Public School, Narnaul, Haryana and Harini from Pushpalata application for students, members and other users to access Vidya Mandir, Tirunelveli, Tamilnadu attained the top rank the required information via smart phones which is a Mobile amongst the participants from Class XI and XII respectively. Application for Web based Content Management System for iOS and Android platforms. Based on the response of the users Baal Sahbhagita on Children’s Day, 2016 and stakeholders, the app has been revamped with enhanced ‘Children are the world’s most valuable resource and its best features to serve the users more efficiently. hope for the future.’ Ministry of Corporate Affairs, had announced celebration of “Baal Sahbhagita”, an event ICSI Study Centre Scheme scheduled with an objective of initiating massive engagement In the month of November, the Institute has opened one study of students through debate, painting competitions, quizzes and centre at Bharathidasan Government College for Women, marathons with special drives in girls’ schools on Children’s Puducherry taking the total count to 30. Day 2016. The Institute also participated in the same by organising a painting competition and quiz competition in a Success Stories of Top 10 Rank Holders of June School for Under-privileged Children in Noida. 2016 Examination The Institute has shared the video bytes of the Top Ten rank Convocation holders of the Institute who have brought laurels to the Institute The Institute is organising region-wise bi-annual Convocations in June 2016 examination. The video link is available at the at Kolkata, Chennai, Mumbai and Delhi in the months of website of the Institute. November, December and January for awarding Certificate of Membership to the Associate members and also to award Epilogue prizes/medals to meritorious students (National) and winners of National level student competitions. The first Convocation The Joy of Little Things in the series was held on November 26 at Kolkata. To my new This time, I came across a simple but wonderfully narrated real members my message would be Seize each moment, seize story authored by Donna Marie Todd, ‘The Joy of Little Things’, each opportunity to grow, and to live your passion. Love your that touched my heart, which really made me to comprehend work and it will give you an impressive identity. deeply about what matters really in our lives and how we take our zillion blessings for granted and never realized grace of Run for the Cause of CSBF God been showered upon us every day. She articulated very ‘A marathon is like life with its ups and downs, but once you’ve beautifully how a simple physical act of ‘eating’ was really a

20 DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 21 FROM THE PRESIDENT by!! such tinylittlemoments,whichwe There areinnumerable life justslips big tohappen…complete that something waiting moments that to just or arehappeningus! happened And, in andinthiswait,forget tocherishsomanybeautiful to happen, for bigthings waiting gadgets. Wekeeping with ourelectronic and stillfindnojoywhilespendingtheseasweareoccupied to tellus.Wewaitfortheweekends kids have day ouramazing to whatourlifepartnerhassayorthecutelittletalesof the time tolisten very little having go tosleep and home We come actually. to nowhere commuters onthebusypathsthatlead other a partofmillion breakfast inahurryandbecome getting ready,wegrabour while in ourmind to complete is onthego!Wegetupfrombedandhavethousandtasks Our livesaresobusythesedays, too busyreally.Everything carrots andbroccoli.I was reallymovedbyhernarrationas: little actofeating the simple months andhowhesavoured to eatafter speech therapistfinallygavehimpermission his from him.And,when anything of eating the ‘pleasure’ in theageof23madehertorealize,asthisstroketookaway blessing untilherhusbandwhosufferedfrom a massive stroke 22 only when we are forcedtorealizeso.” “The joy of lifeisinthe little thingsandwe realize this taught meagreatlesson that day: gratitude for asoft carrot inallmy life. Myhusband seen anything asbeautiful asmyhusband’s He savouredeverymomentofthatmeal. of vegetables. plate minutes toeatthat took him45 It chew. his mouthandbeganto into the carrot fork, pulled slowly heopenedaroundthe hismouth,closedlips then very And it. and sniffed the color admired it, at up andlooked He heldit determination. a carrotwith grasped hisforkwithweakrighthandandspeared open with aflourishand spread iton his lap.He Then he flashedalopsidedgrin,flappedhisnapkin “Thank... you...God.Amen.” in hisandveryslowlysaid With anairofutterreverence, he gentlytookmyhand some vegetables on a plateandsatdownnext to him. until theywerejustsoandsaid“join...me.”SoIput the plate tothe table andrearrangedthe vegetables out of the pan andplacedthemon his plate.He took I steamedthe carrots andbroccolithen lifted them ones reserved for very special occasions. edged ingoldwitha pale pinkrose in the middle. The tome,theones of mymother’sbonechinaplates He carefullycarriedone room table. head ofthedining took outafancy,ironedlinennapkinandputitatthe He wenttothehutchand at thecarrotsandbroccoli. “When we gothome, he opened the fridge andpointed I havenever New Delhi Best wishes Happy Miracles!! perception (fromfeartolove)equatesamiracle. shift in way.” Theslightest in anuncommon see thecommon To quote NoahBenshea:“Ato miracle isoftenthewillingness moments. but mostjewelled microscope that is able to discover andappreciatetheselittle a to become our vision So, letusraise always. does year old tocomeacross,likeathree in everythingwehappen laughter little, theyarethepearlsofourlife.Letuslearntofindjoyand things, itisinus.Thelittlethemoments,theyaren’t joy isnotin moments… indeed warming Beautiful…heart     thatwe’reblessedwitheveryday. simple pleasures of the be mindful moments. Let’s a growingmosaicofhappy little things that come aliveineachmoment, our lifebecomes joy oftheselittlethingsinourlife.Whenweaffirmtoenjoythe new year,letusmakeaNewYearresolutionofnotmissingthe towards abrand fail tofindjoyinthejourney.Whileheading Sometimes, webecomesofocusedonthefinishline,that postpone ourhappiness. as we of ourcircumstances a slave more being nothing being these littlethings, what is the rest of life madeof? It winds up every moment.Withoutslowingdownto unfolding appreciate the joyofplentylittlethingsinourlife and appreciate down to our ownmentalandemotionalhealthisrememberingslow This storytaughtmethatoneoftheeasiestwaystosupport that maynevercome. for thosebigmoments pass…and we,keepwaiting similarly in lifeornot.Somanyyearshavepassedandmorewill overlook whenwe sit down to “evaluate” whetherwearehappy December 05,2016 December in worstofourmoodsandspirit Let us value the bear hugby some lovedonewhenweare without failformostoftheirlives let us kiss the hands todaywhodoallthis selflessly and our kidstiffin box is duly packed withoutanyexpectation; and prepared fully we gotoourworkplaces before things our betterhalfsettingthe watching Let usfeeljoywhile Let usrelishhomefoodcookedbyourMaaorGrandma seven million,letustreasurethosewonders seven wondersof the world ina child’s eyes, there are no there are heart; itissaid of achild’s the innocence and the mystery Let usenjoythemagic,purity,wonder, . DECEMBER 2016 I CHARTERED SECRETARY (CS Mamtabinani) [email protected] Yours sincerely CHARTERED SECRETARY I DECEMBER 2016 23 ARTICLES

n CSR in the Indian Context – the Past, Present and the Future n Statutory Corporate Social Responsibility– A Philosophical Shift in Decolonized Company Law n CSR – Rethinking the phenomenon n Social Audit and Corporate Social Responsibility n Corporate Social Responsibility - Priceless Contribution of Corporates towards Prosperity of People and Planet n Corporate Social Responsibility is not charity, but a responsibility n Audit of Corporate Social Responsibility n Efficacy of Social Audit in Contemporary Statutory Enforcement of Corporate Social Responsibility in India n Social Audit under Companies Act, 2013 n Social Audit in the Context of CSR n Social Responsibility of Enterprises need for Social Audit n Levy of GST on E-Commerce & Aggregators

22 DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 23 Articles in Chartered Secretary Guidelines for Authors 1. Articles on subjects of interest to the profession of company secretaries are published in the Journal. 2. The article must be original contribution of the author. 3. The article must be an exclusive contribution for the Journal. 4. The article must not have been published elsewhere, and must not have been or must not be sent elsewhere for publication, in the same or substantially the same form. 5. The article should ordinarily have 2500 to 4000 words. A longer article may be considered if the subject so warrants. 6. The article must carry the name(s) of the author(s) on the title page only and nowhere else. 7. The articles go through blind review and are assessed on the parameters such as (a) relevance and usefulness of the article (from the point of view of company secretaries), (b) organization of the article (structuring, sequencing, construction, flow, etc.), (c) depth of the discussion, (d) persuasive strength of the article (idea/ argument/articulation), (e) does the article say something new and is it thought provoking, and (f) adequacy of reference, source acknowledgement and bibliography, etc. 8. The copyright of the articles, if published in the Journal, shall vest with the Institute. 9. The Institute/the Editor of the Journal has the sole discretion to accept/reject an article for publication in the Journal or to publish it with modification and editing, as it considers appropriate. 10. The article shall be accompanied by a summary in 150 words and mailed to [email protected] 11. The article shall be accompanied by a ‘Declaration-cum-Undertaking’ from the author(s) as under: Declaration-cum-Undertaking 1. I, Shri/Ms./Dr./Professor…...... declare that I have read and understood the Guidelines for Authors. 2. I affirm that: a. the article titled “….....” is my original contribution and no portion of it has been adopted from any other source; b. this article is an exclusive contribution for Chartered Secretary and has not been / nor would be sent elsewhere for publication; and c. the copyright in respect of this article, if published in Chartered Secretary, shall vest with the Institute. d. the views expressed in this article are not necessarily those of the Institute or the Editor of the Journal. 3. I undertake that I: a. comply with the guidelines for authors, b. shall abide by the decision of the Institute, i.e., whether this article will be published and / or will be published with modification / editing. c. shall be liable for any breach of this ‘Declaration-cum-Undertaking’. (Signature)

24 DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 25 MAY 2016 14CHARTERED SECRETARY I SEPTEMBER 2016 15 24 DECEMBER 2016 I CHARTERED SECRETARY * [email protected] BSE SammaanCSRLtd,Mumbai MD &CEO Hemant Gupta Present andtheFuture CSR intheIndianContext –thePast, of theauthor. The viewsexpressedhereinarepersonal. views CHARTERED SECRETARY I DECEMBER 2016 rather “participants” as“givers”andnot themselves viewed typically ofthecorporates the management One reasonfor Social Responsibility.that was thatdecisionmakersor the socalled as Corporate today recognize not exactlywhatwewould or charityand philanthropy Whether it was theeastor west, corporates engagedin what wewouldcall localities theyoperatedinorforcommunitiescamefrom. of for theup-liftment spent money also Other corporates to champion. they wanted created theirown foundations that were usedto by thefounders asvehiclesfor causes stature, global assumed some ofwhom organizations, Thelarger or bycommunities. stress), continues in the form of fund raisers/ charity driveseitherledby the church upon attimesofsocial causes andalsobedrawn beusedforsocial a fundthatwould establishment, butalso proceeds ofwhichwerenotonlyusedtosupportthereligious Similarly, inthe west, what originatedas a “tithe” (a tax levied by the church, the giving backtosociety. In most instances these weretreatedas acts of charity orphilanthropy, or the owners back tothesocietyinsomeshapeorform. through whichwehadcorporatesgiving places of worship to bring communitiestogether;orawholehostof other methods to their communitiesorcausesnearanddearto their hearts; or foundations building giving back employees; orbusinessmen families andhencehappier having happier on amigratoryworkforceandfor them toreducedependence around communities in the Whether itwasthefactoriesinvesting since timeimmemorial. Philanthropy inCSR/ have beenengaged Charity/ As iscommonwisdom,Indiancompanies BACKGROUND This more inclusive form of charity, changed the very nature of corporate giving over the verynatureofcorporate giving formofcharity,changed This moreinclusive participate andvolunteerismalso startedincreasing. causes inwhichthe funds were invested.Managersinturn, encouraged employeesto the so did expanded, and of “stakeholders” Withthat thesphere the management. before) toothers in withtheowners(asmentioned localized from being expanding making with thedecision were propelled The earlywindsofchangein thisdirection forward. shift andwhatisthepathgoing this paradigm what caused CSR. Letusexamine using and Brandbuilding Strategic Alignment about socialimpact,butalsoincludeCorporate just longer no are threads the discussion or Sustainability, of CSR the sphere in Even here being“more”,corporatecharityisstillaliveandkicking, butisreducinginimpact). (keyword more byIndividuals done charity issomething Nowadays, and Sustainability. are CSR India, thebuzzwords as within as well and, globally to thepresent Fast forward MOVING FROMCHARITYTOCSR charity, withthereinsbeingfirmlyinhandsofowners. widened further as the employees of the corporate hadlittleor no roleto play inthis Corporate Indiainthisspace. conclude withsomeofthedriversinfluencingbehaviourtoday’s Responsibility (CSR) to Corporate Sustainable Development (CSD) and of CorporateIndiamovingfromPhilanthropytoSocial Through this article the author is endeavouring to trace the journey than PART-1 : “stakeholders”. and Articles on Social AuditArticles onSocial &CSR the recipients This of distance the charity between were the viewed givers purely and as the “beneficiaries”, beneficiaries 25

ARTICLE ARTICLE corporates acouple ofoptionsinparticipating inCSR– their CSRspendswithcorporate objectives.Thelawgave law. For other companies,this was anopportunityto re-align already and re-strategisewhattheyhad was achancetore-review (UNIDO) Organisation Development Industrial Nations The United Business’. of 21stCentury with Forks:theTripleBottomLine ‘Cannibals in his1997book articulated morefullybyJohnElkington In subject. on the in severaltheoriesandbestpracticesbeingpublished also resulted and research institutions. Thedebate educational of alotveryrespected as asubjecttothecurriculum added to being in addition research, and debate academic of greater the subject As CSRbecamemoremainstream,italso charity wasevolvingandassumingabroadercontext. time. The same wastrue in the east and inthe west, corporate CSR intheIndiaContext–P 26 investments or without the law–usedthis opportunityto streamline the undertook CSRanyway – with that traditionally Companies discussion oranicetodoactivity. andnotjustacoffeetable being aCorporateResponsibility the CompaniesAct, into 2013. SuddenlyCSRwaspropelled of 135 of Section The icingonthecakewasenactment corporate subject. the “Tatas becameamoremainstream and Birlas”,increasingly of thatcameinthepurview Government subject,orsomething Social development, that had long been treated as a CSR trendsinIndiaandoverseas. in CSRthe west, which resultedingreateralignmentthe to thetrends exposure them agreater also gave Globalization to contributethesociety. and prosperbemorewilling to them opportunities grow operate withmoreliberty,providing to Indian Corporates bytheGovernment.Thisallowed relaxed and controlswerebeing up, licenses opened was being economy in west,theIndian Concomitant withthesedevelopments of staying withthetopicat hand, these are notdiscussedhere. however, intheinterest on CSRthatareapplicable, publications There areseveralotherequallyimportantresearchworksand Social Responsibility(CSR)– financial and environmental report onsocial, and measure should Working’. Inthiswork,hearguedthatenterprises Co-operative Tool for in apublicationcalled‘SocialAudit-AManagement 1981, the expectationsofshareholdersandstakeholders.” Bottom-Line- Approach”),whileat the sametimeaddressing and socialimperatives(“Triple- economic, environmental the way through which a company achieves a balance of as being understood CSRisgenerally their stakeholders. concerns intheirandinteractionswith business operations environmental and social integrate companies whereby concept is amanagement Social Responsibility “Corporate been Freer performance. puts they doing Spreckley forward made in order The the in first this following to phrase articulated ast fit regard. , PresentadtheFuure into “triple the definition For the requirements bottom triple these of bottom firms, Corporate line” of was this line the b) a) CSR spendof these 100companies,aggregatedto Rs. 52.4bn in FY2015.“The disclosures by IiASofBSE100companies’ of astudy the subject was of thelaw impact The immediate in to lookatnewareasandpilotsomeinitiatives Choosing solutions andbenefitstoawiderpopulation their had, replicating that theyalready up initiatives Scaling objectives. competitors etc. capital, differentiate themselvesfrom save money, increaseaccessto consumers, easetheirsupply chains, brand intheeyesofinvestorsand risk, recruitemployees, bolstertheir increasingly CSDtomanagetheir Companies investinCSRand the first year DECEMBER 2016 that were aligned I CHARTERED SECRETARY with their Corporate CHARTERED SECRETARY I DECEMBER 2016 27 26 DECEMBER 2016 I CHARTERED SECRETARY CSR has and services of goods delivery that sincepublic government), within the (including recognition but thereiswidespread infrastructure has been the responsibility of the Government, of this the development traditionally, earlier, As mentioned which inturnwillbettertheiremploymentprospects. improving thelevelof nutritional, skillandeducationalyouth, health, skilldevelopmentandsocialinfrastructurewillresult in turn into a source of social division.Investment in education, the dividend not have and its rewards to reap infrastructure of theright for thecreation need urgent is an There dividend. being the fact that India hasaccess to a huge demographic The 85bn inthecurrentfinancialyear,”studysaid. to Rs. in FY13.Thisamountisfurtherexpectedtoincrease amount, itwasupalmost75percentfromRs. 30bn prescribed the than 26 percentlower was the spend for FY15.Although efficacy in enhanced to thissector therebyresulting innovation bring also but will goods, and of theseservices for delivery channel implement the same.Tools suchastheBSESammaan implement out their CSRstrategy and identifying suitablepartnersto corporates It’s now beentwoyearssince the lawwasenactedandmost been law CHARTERED SECRETARY not and was riddled only have a very more provides

already with significant scalable corruption gone a I DECEMBER 2016 more infrastructure for through

several and efficient bureaucratic the reasons, being process and implemented. cost-effective one inefficiency, of of figuring them 3. value ofthesame. stages of this journey, but almost allrecognizethe Strategic are atdifferent different Corporates Clearly, Development. by themtotheirstrategic advantage andfor Sustainable a mainstreamactivityfor Corporates, butisbeingleveraged Act, of theCompanies2013,CSRtodayisnotonly introduction Assisted bythe a longwayfromthedaysofphilanthropy. CSR journeyhas come the IndianCorporates’ In conclusion, 4. 2. 1. below - from competitorsetc.etc..Someofthekeydriversaregiven themselves accesstocapital,differentiate money, increase save chains, their supply ease consumers, and of investors bolster theirbrandinthe eyes their risk,recruitemployees, CSD to Companies investinCSRandincreasinglymanage Why CSD overall so manytrees,thatthe only forestry. Itmeantcuttingdown phrase “SustainableDevelopment” arefrom 18th Century (CSD)”. Development Interestinglyenough,theoriginsof the Sustainable “Corporate to whatiscalled and morereferences As CSRmaturesincorporateIndia,wearecomingacrossmore CSR TOSUSTAINABLEDEVELOPMENT from CSRtoCSD. factors the underlyingthat are makingCorporateIndiamove to understand inCSDanditwillbeinteresting the stakeholders to all be applicable this would In thecontextofourdiscussion, own needs”. to meet their of futuregenerations the ability compromising thatmeetstheneedsofpresentwithout is “development platform So wheredoestheCSRjourneyleadtoinnearfuture? Agencies) havehelpedcorporatesinachievingthisobjective. projects Long-term projects–Theywishtoestablishlong-term from theirinvestments. attrition, reduces and morale employee enhances This notonly and inthe conceptualizing executionof CSR programmes. effective deliveryofCSRatthegroundlevel. State Governments alsosteppinginto contribute to more of partnershipswiththeCentraland focus onPublic-Private there isalot collective andsustainedimpact.Additionally, it tocreate a to leverage wish efforts and collaborative that’s in They seethevalue and priorities. vision other’s each with the companies among alignment a strong be Also,thereseemsto companies. of various inclinations and forums withregardtothestrategies,approaches held in being –Thereisalotofdiscussion Partnerships brand wheneveraparticularissueistalkedabout. stakeholders, butalsoestablishastrongrecallfor their there that realised have – Companies engagement Employee seen andtalkedabout. companies wantto ensure theycreateimpactthat can be leader. for every effect isimportant a tangible Impact –Making CSR intheIndiaContext–P tree (that is significant Given population but that provides can not the significantly only value a is sums wide preserved. serve in engaging array of the enhance money ast of purpose A , PresentadtheFuure verified their more the can employees of recent benefit Implementation be benefiting significant, definition 27 accruing both the

in CS

ARTICLE ARTICLE [email protected] IIT, Kharagpur. School ofIntellectualPropertyLaw Associate Professor,RajivGandhi Dr. IndrajitDube Company Law A Philo Statutory CorporateSocialResponsibility– 28 sophical ShiftinDecolonized reforms in trading practice in stock exchanges.(Shah, 1999) This wastobring 1999) in stockexchanges.(Shah, practice reforms intrading normsandprescribedrulesformarketparticipants, initiated anddevelopedseveral reforms inmarketpractice, and regulatetheCapital Market.SEBIinitiated develop to The mandatetoSEBIwas established. (SEBI), was Board ofIndia Exchange To initiatemarketreforms under NEP,capitalmarketregulator,Securitiesand Gokarn, 1996) generally, legislations.(See several enacting, andamending byrepealing, reforms were initiated institutional n.d.,p.3)several (“Economic SurveyofIndia:2007,OECDPolicyBrief(2007),” To supportthisgrowththroughamarketeconomy, and moreprivateparticipation. more through rate ofgrowth from Hindu growth was tomovetowardsholistic objective of expansion non-PSUdomesticcompaniesandinvestment byforeigncompanies.The accessed bythe PSUs. of The de-regularizationdifferent sectorsincreasedthe or only equities toparticipateindifferentsectors,whichwasuntil thendominated private on PSUweredoneawaywithunderNEP.Thisencouraged overdependence the capitalmarket,and control overaccessing aslicence-raj), known popularly economy. Centralizedbureaucraticcontroloverresource allocation(whichwas Indiawiththeworld in1991soughttointegrate Economic Policy(NEP)introduced Sharma, 2009,p. 1523; Singh, 2002,pp.3–5;VanZile,2011,p. 285) etc. New currencies, (Cerra&Saxena,2002; of foreign balance payment deficitandsinking of Rate of Growth’, theheavybalance known as‘Hindu economy whichispopularly (PSU), slowgrowthinthe Sector Undertaking in themodelofPublic inefficiency model of India. Thechangesinitiatedinthe economy weredueto several factors, i.e., the economic in a transformation marked of1991 beginning and The endof1980 Shift inEconomicPhilosophy Introduction a strongCSRmandatepriortotheenactmentofthenewCompaniesAct2013. emerged asamajorequityholderby60’s,withallthegovernmentcompaniesadvocating development andtoutilizetheprofitforsocio-economicupliftment.TheGovernment industrial segments.Theobjectivewastousethecorporationasavehiclefor era. Translationofthisphilosophywasnationalizationmajorcompaniesindifferent appointed to recommend company law and industrial reforms in the post-independence philosophical approach was echoed in the reports of various expert committees pluralism. Theroleofbusinessinnationbuildingwasreadilyrecognised,andthis governed by the mandate to achieve social and economic justice and aimed at economic instrumental catalystforCorporateSocialResponsibility(CSR)initiatives.India was ethical, cultural and strategic reasons. Post – independent governance of India was an historicevidences. Therehasbeenmultipledriversleadingtothislaw,includingmoral, development, CSRwas not a new conceptin India and can be traced with (CSR) throughthenewCompaniesAct2013(CA2013).Priortothislandmark India isthefirstcountryinworldtointroduceStatutoryCorporateSocialResponsibility formalization ofCorporateSocialResponsibilityinIndia. economic modelofIndiaalsohighlightstheattemptsmadefor The articlewhileexplainingthereasonsfortransformationof DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 29 28 DECEMBER 2016 I CHARTERED SECRETARY stakeholders about reframing of Companies Act. On 2 concept paperon its website to seek suggestionsfrom On 4 of thecompany. the functioning emphasized onrecognitionof different stakeholders’ rightsin The Committee para. 1.22(b)) Affair, MinistryofFinance,2003, of Corporate …’(Department stakeholders, on various impact prosperity of the entities[companies],beingmindfulof the structural environmentthatisconducivetothegrowth and reforms, regulatoryenvironmentshould‘…providing a The Committeeobservedthatkeepinginmindeconomic (Department ofCorporateAffairs, Ministry ofFinance,2003) Act, Companies 1956andIndianPartnership1932. to the reference with particular environment regulatory rational Chandra on10 of SriNaresh Chairmanship a committeeunder appointed of Finance, Affairs, Ministry ofCompany The Department strengthen theCorporateGovernancefurther. Subsequently, several committees have been set up to on CorporateGovernance(Clause49)of Listing Agreement. of recommendation theBirlaCommitteeincorporatedprovision 2015, p.57)The & Kamalnath, as well.(Gopalan stakeholders has anotbut responsibility onlytowardsshareholdersthe the CommitteefeltthatBoard of severalrecommendations, Out Governance. of GoodCorporate the standards for raising BirlaCommitteetomakerecommendations Kumar Mangalam in 1999,SEBI Consequently,set up American philosophy. submitted thereportwhichborrowedheavilyfromAnglo- of bestpractice.Thecommittee code a voluntary recommend issues, and to committee toexaminecorporategovernance ofIndianIndustry(CII)bysetting up a the Confederation was by The firstinitiative Governance. time wasonCorporate reforms of this advise onthereforms.Oneofsignificant investor protection. It appointed severalexpertcommitteesto SEBI aggressively concentrated on market reforms and inept tomeettheneedofhour. (twice) and2006. It was felt that mere amendmentswouldbe Act in1999,2000,2001, 2002 Companies 1956wasamended the n.d.) Tothat end, Secretariat, framework. (LokShaba legal needed to introduce reforms in the policy, institutionaland it wasfeltthat India In thisbackdrop, business. space inworld to theeconomyandcreated significantly They contributed ambition. international and cherished service andproductions segment of the new entered now Companies phenomenal. at thistimewas of incorporations activities. Thenumber the preferredbusinessvehiclefor economic andcommercial and dynamic.Companies,mainly private equity,emergedas After reforms, the economy becamemorediverse,complex Sharma, 2009,p.1524). Patil, 2006;Shah,1999; 2000).doc,” n.d.;Seegenerally, in OperationIndia(1994to business.(“Growth ofCompanies bureaucratic control, which facilitatedthe development of the strengthened the regulatory institutions and minimized practices. The reforms generated investor confidence, transparency, predictability, and openness in the market Chairman of the Expert Committee (popularly known as Irani known of the ExpertCommittee(popularly Chairman as of thecountrywasappointed leader corporate noted December 2004, Dr. J.J. Irani, Director, Tata Sons Ltd., and a th CHARTERED SECRETARY August 2004,theMinistry of Corporate Affairs placed a th Jan., 2003 tosuggestamorescientificand I DECEMBER 2016 Statut ory Corporate Soc ial Responsbility –APhilos inDecolonized Compaophical Shft ny La nd

Bill inLokSabhaon3 partner together’.(“Corporate Social Responsibility Voluntary Social Responsibility partner together’.(“Corporate Government, corporatesector andcommunitiesneedto mechanism is required to this channelize energyfor which the a suitable this area, in for utilization is available energy and economic While alotofhuman responsibility. social business sectorpracticesvarious methodsof its discharging thebusinessmodel, Indian interestin stakeholder’s From inactive philanthropy to the incorporation of the been sociallyresponsible. ‘The Indianbusinesshastraditionally He furtheradded, 2009,” n.d., p. 05) Voluntary Guideline Social Responsibility operates’(“Corporate well-being ofthecommunitiesinwhichbusiness of wealthand business practicesthatensuresthedistribution take theresponsibilityofexhibitingsociallyresponsible to sector alsoneeds the business of sectoralprogrammes, a series through initiatives development extensive undertakes the government While to bebridged. needs This gap capability. 1 between theIndiaandBharat the gap as widening seen is something growth The corporate illiteracy, malnutrition,etc., unemployment, facingthenation. simultaneously wealsohavetheproblemofpoverty, value for the shareholders in the last sixty years, but ‘We have seenthe business sector generating wealthand note, commentedthat, of CorporateAffairs, Mr. SalmanKhurshid,inhisforwarding by the Indian Companies.The then Ministerof State, Ministry 2009,”n.d.)tobeadopted Voluntary Guideline Responsibility Social 2009’(“Corporate Guideline Voluntary Responsibility Social the ‘Corporate Bill, 2009,italsopublished Companies While the Ministry, on onehand,wasbusyplacingthe Responsibility Attempt toformalisationofCorporateSocial introduced on 23 on introduced the Irani Committee, a new Companies Bill, 2008 was the report. Following in find aplace didn’t responsibility social about corporate & Kamalnath,2015,p.58)Also,discussion interest.(Gopalan anything onthenon-shareholder deliberate Affairs, 2005)TheCommitteedidn’t (Ministry ofCorporate investigation under the Companies Act, offences andpenalties. protection, accessto capital, mergerandacquisitions, transactions, minorityinterests,investoreducationand Management and Board Governance, related party ofe-governancein companyadministration,adoption of companies, covered differentaspectsliketheclassification its reportwhich submitted Committee Irani Subsequently, protection or CSR.(See, Gopalan& Kamalnath, 2015,p. 58) on stakeholder The conceptpaperdidn’topenanydiscussion ministries. andtheconcerned regulatory bodies professional bodies,expertsandrepresentativesfrom statutory various industriesandtradebodies/associations, Concept Paper.ThisCommittee included representativesof on the received the suggestions to examine Committee) 14 of to thedissolution due about CSR.Itlapsed any clause th whereas Bharat indicated as underdeveloped restofIndia. asunderdeveloped whereas Bharatindicated Urban India anddeveloped indicatedasincreasing prosperous ‘India’ LokSabha. Subsequently, the Government introduced the LokSabha. Subsequently,theGovernmentintroduced rd October 2008. The bill also did not include did also Thebill October2008. rd August 2009 as Companies Bill, 2009. August 2009asCompanies 1 through its income-skewing 29 w

ARTICLE ARTICLE Statut 30 thereto?’(Question No.151, Corporate Social Responsibility, Social No.151, Corporate thereto?’(Question of thegovernment thereof andthereaction if so,thedetails in thisregard;and objections their reservations/ whether theCorporateSector has expressed if so, the detailsthereof; (CSR); Corporate SocialResponsibility net profitunder Sector tospendtwopercent ofcompanies’ the Governmenthas madeitmandatoryforCorporate ‘whether Natarajan, MP, Lok Shabaaskedthequestion, in the floor of the Parliament. On, 25 in thefloorofParliament. the IndiaandBharatbecameintense The argumentregarding Concern ofIndianParliamentonCSR generally, Gopalan&Kamalnath, 2015,pp.59–60) 2009,”n.d.,pp.11–12;See Voluntary Guideline Responsibility Social defined.(“Corporate werewell inclusive development human rights,respectforenvironment,activitiessocialand functioning, respectforworkers’rightsandwelfare, The ‘coreelements’like,carefor all stakeholders,ethical mechanism andresponsibility,time schedules andmonitoring. to identify the implementation strategy, organizational bytheBoard.TheCSRpolicyalsoneeded should beapproved levels of executives for the development of the policies which of various 2009,” n.d.,p.11)Ittheinvolvement suggested Guideline Voluntary Responsibility Social goals’.(“Corporate part of the overall businesspolicyandalignedwithits business policy foreachbusinessentity,‘whichshouldbeanintegral upon theformulationofCSR emphasised The Guidelines 2009,” n.d., Guideline p.9) development.’(“Corporate Social Responsibility Voluntary growth and in economic citizens eagertobeactiveparticipants and of enterprise, theaspirationsofstakeholders modern-day of with thechallenges grapple current times,asorganizations and all-encompassing values are even more relevant in These sound of allstakeholders. of thewell-being objective is still relevanttoday, inspires peopleto work for the larger which wisdom, ancient India’s character formillennia. nation’s our defined that have the values within of working tradition andbusinessenterpriseshavea ‘Indian entrepreneurs long in thepreviousparagraph. attempted tohighlight have of thispaper author which ethos business summarisethe The Preambleof the Voluntary Guidelines attempted to 2009,” n.d., Guideline p.06) On 1 (Questions),” n.d.) practices inthe interest of astakeholder’.(“Lok Sabha Governance Corporate good through voluntarily responsibility their social to address encouraged being said, ‘companies that theGovernmentdidnothaveanysuchplan.He answered Gupta, Affairs, Mr.PremChand of Corporate The thenMinister the Parliament],“LokSabha(Questions),”n.d.) of [Lower House Responsibility, Social Question onCorporate amongindustries?’(QuestionNo.4627, social responsibility corporate The mannerinwhichtheGovernmentisencouraging is beinghonoured;and Corporate SocialResponsibility If so,thechecksthathavebeeninstitutedtosee company tohaveacorporatesocialpolicy; for every the Governmenthasmadeitmandatory ‘whether Gandhi, MP, LokSabha, askedthequestion, st ory Corporate Soc ial Responsbility –APhilos inDecolonized Compaophical Shft ny La December 2011, Mr. and AsaduddinOwaisi P. R. th April2008,Mrs.Maneka own doalotof CSR contributionsandit would be cumbersome sector onits Governments feelsthatthecorporate whether commitments; Responsibility profits towardsCorporateSocial 2 percentoftheirnet to spend for companies compulsory Committee onFinancehas recommendedtomakeit ‘whether the Department-related Parliamentary Standing on 22 and inclusioninthenewAct (See Table 2). In the RajyaSabha, active overCSRdevelopment wasequally The RajyaSabha Table 1 2007 to2015. raised onCSRinLokSabhabetween of thequestions represents thenumber below The graph “Lok Sabha(Questions),”n.d.) by companiesvoluntarily.’ in 2009foradoption VoluntaryGuideline Social Responsibility Corporate This Ministryhasissued examination. is under disclosure inthe Directors” reportto the members. Thereport activities by a class of companies along with sufficient financial years on Corporate Social Responsibility (CSR) preceding of averagenetprofitsduringthethreeimmediately introduced inLokSabha,has recommended spendingof 2% Finance, after examination of the CompaniesBill, 2009 (CSR) activities.StandingCommitteeon The Parliamentary have a provision to mandate CorporateSocialResponsibility the government andsaid,“TheCompaniesAct, 1956 doesnot of the position summarized Affair Mr.MurliDeora Corporate Venkatarami Reddy]ofLokSabha.ThentheMinister Lalubhai PatelandMr.M.Krishnaswamy,Anantha again raisedbytheMembers[Ms. Priya SunilDutt, Mr. CSR andfundspend mandatory regarding questions similar no. 216) (Starred question 10.03.2011 no. 630)and question (Unstarred in24.02.2011 to betiltedtowardsthat.(Subsequently embedded withtheandGovernmentseems parliamentarians got firmly CSR of mandatory It seemsthattheprocess Sabha (Questions),” n.d.) year.’(“Lok ofthenetprofitprevious percentage specified as a a CSRbudget resolution, through aboard mandatorily, to create losses, have except thosemaking enterprises, Central PublicSector Enterprises inApril2010,whereinthese for hasissuedGuidelines Department ofPublicenterprises Corporate SocialResponsibility(CSR).However,the sector to spend two percent of companies’ net profit under ‘Government hasnotmadeit mandatory for the corporate said: The then Ministerof Corporate Affairs, Dr. M VeerappaMoily, “Lok Sabha(Questions),”n.d.) nd November 2010, November2010, Mr. Ishwar Singh, asked: DECEMBER 2016 w I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 31 30 DECEMBER 2016 I CHARTERED SECRETARY The CommitteeopenedaPressdated18 Communique regulators. with theframeworkofothersectoral harmonized the Bill whether and framework legal the proposed examine Standing Committee onFinance inSeptember 2009to Bill, 2009tothe referred theCompanies The Parliament Committee Proceeding andRecommendationofStanding Table 2 829, Dated08.08.2011“RajyaSabha(Question),”n.d.) ministry duetoitsvoluntarynature.(Question by theconcerned that therewerenosuchdatamentioned the Ministerresponded spending onCSR. On the question of failure of voluntary CSR, the Ministrydidnotmaintainanydatabaseoncorporate that but informed was on2%spending Committee Standing acknowledged that the recommendation of Parliamentary Khurshid, Affairs, Mr.Salman of Corporate The thenMinister 22.11.2010 “RajyaSabha(Question),”n.d.) policing of their books;…’ (Question No. 1256, Dated to makeitmandatoryasthecorporatesectorrightlyresents corporate social responsibility’. On inquiry of committee about corporate social responsibility’.Oninquiryof committeeabout further ‘2 per cent of the last 3 years should be spent on are profitable companies and which are certain size’. He added policy in each and every company beyond a certain limit, which responsibility. …therewillbe a CorporateSocialResponsibility mention intheearlierCompanies Actaboutcorporatesocial deposed before theCommittee andstated, ‘There was no p. 14) While the Secretary, Ministry of Corporate Affairs, policies andactivitiesthereunder.”LokShabaSecretariat,n.d., requiring biggercompaniestomakedisclosureabouttheirCSR Corporate SocialResponsibility(CSR)asaconceptinthe Bill, as aconceptintheBill.(Toquotefromreport“Introduction of principles of the Bill and the most innovative of them was CSR 14) After deliberation, the Committee developed guiding modified, altered and formulated.(Lok Shaba Secretariat, n.d., p. 500 casesmadebytheCommittee.Andabout125were The MinistryofCorporateAffairsacceptedthesuggestions in Affairs forresponse. questions onthe bill weresent to nodal MinistryCorporate Secretariat, n.d.,para.11)TheParliamentary (Lok Shaba the Bill. in for modifications/inclusions suggestions numerous comprising Memoranda received morethan100 Committee experts/interested individual.Inresponsetothat,the September 2009, to invite suggestions from institutions/ CHARTERED SECRETARY I DECEMBER 2016 Statut ory Corporate Soc ial Responsbility –APhilos inDecolonized Compaophical Shft ny La th

activities.’(“Discussion on themotionfor of activities.’(“Discussion consideration the amount earmarked forCorporateSocial Responsibility area andareasaroundit where it operates, for spending the to thelocal preference give shall that thecompany ‘Provided intheBillandinserted, Corporate SocialResponsibility) for 135 (i.e.Clause in theClause amendment suggested of principle disclosure,not on policing.Thelowerhouse CSR, theMinistercommented thatitwillbebasedonthe ofwhatshouldbethedeliveryprogramme On thequestion Bill, 2011(BillPasses),” 2012) of theCompanies consideration choice andplaceofonthe activities.(“Discussion motionfor about their freedom tothecompanies like togiveenough the stringent CSRcompliance,hetold, the Government would On theissues of of development. Bharat fromtheperspective Passes),” 2012) He wentback to the debate onIndiaand (Bill Bill, 2011 of theCompanies for consideration motion on the now becomeamandatorypartofthisbill.”“Discussion and theywanttogivebackthesociety.Therefore.CSR has move forwardandshowthat they are responsible,sensitive themselves if thecompanies correction. Thatcanonlybedone bigger andbigger. It is abouttimethat we doaperception is getting the poor and the rich between country, thedivide air as we go forward.We have seena big divisioninthis of theirfunctioning,Ithe Think, willgoalongwayinclearing as a part company, buttohaveacorporatesocialresponsibility give backto the society. Giving taxes is aof responsibility the who must also areas andwebelievethatitisthesecompanies manufacturing or production companies,theyworkincertain which they function. It is because everycompany,beit in 2 percentoftheirprofitintothecommunities contribute to of companies class for certain It isnowmandatory following. bigger andbigger.(“Sir,the CSR provisioninthisbillisthe is getting the poor and the rich between the society’.Thedivide to back give but they‘mustalso of thecompany responsibility Passes),” 2012)Headdedthatthepaymentoftaxis (Bill Bill, 2011 of theCompanies for consideration motion on the “Discussion to bepartofthisbill.” forced thisissue really Committee onFinanceandallitsMembersforhaving asastatute. Social responsibility I must thanks theStanding India perhapswillbethe first country that will haveCorporate they dothat,itisforthefirsttimeand and while meaningfully India we must have the corporate entities contribute that in But webelieve are FranceandIndonesia. countries The in theworldwherethereissomesortofCSRregulation. and wehavelearntthereareonlytwocountries study globally am happy to inform the Housethatalarge we haveundergone on CSR.(“I and Indonesia,whohavesomesortofregulation Sachin said,therearetwocountriesintheworld,i.e.France thebill,MinisterofCorporateAffairs, While defending Mr. was acceptedbytheMinistry. Director ReportregardingCorporateSocialResponsibilitywhich insertion ofastatutoryprovisionforseparateheadinginthe a provisioninthelawitself’.TheCommitteerecommended something wecannotmandatebeyondthat,butaremaking limit shouldhaveacorporatesocialresponsibilitypolicy.Thisis putting it in the law itself that every company beyond the certain social responsibilitywhichtheChairmandirectedtous.Weare the firsttimeinworld–isthatweareputtingCorporate report’. Headded,‘Thisisthefirsttimeandhistoricallyitmaybe being donewillbeinpublicdomain.…Itgiventhe of the Act is disclosure method. Whatever is being done, what is monitoring thesocialobligation,hereplied,‘Thewholeemphasis 31 w

ARTICLE ARTICLE Statut l Reference and economicpluralism. role toplayinresourceallocation that recognizing thebusinesses (readascompanies)havea are increasingly in thesecountries countries. Thegovernment Corporate LawPhilosophy with reference to developing within to theauthor,thisisanewdevelopment According another. of mandatoryCSRdifferfromonecountryto implementation of mandatory CorporateSocialResponsibility.Themodalities their lawsto adopt etc.)whohaveamended China, Indonesia statute book;butfactually,thereareotherAsiancountries(e.g. in the responsibility corporate social has incorporated which It has beeninformedinParliamentthatIndiaisthefirst country Conclusion company needbeplacedinthecompany’swebsite. the Boardreports,rulesspecifythatCSRactivitiesof 2014. The rule has again been amended in 2015. In addition to Rules, Policy) Responsibility Social (Corporate Companies Government framedtherulesonCSRin2014,i.e.,The Government and inserted a modification in the year 2014. The and the Schedule have undergone amendment under the New committee andactivitiesintheBoard’sreport.BothSection n.d.) The Board needs to disclose the composition of the CSR Policy’.(Sub -Section5,135“CompaniesAct2013,” years, in pursuance of its Corporate Social Responsibility company madeduringthethreeimmediatelyprecedingfinancial year, atleast,twopercentoftheaveragenetprofits needs toensurethatthecompanyspends,‘ineveryfinancial Section 3, Section 135 “Companies Act 2013,” n.d.) The Board propose themechanismformonitoringactivities.(Sub- undertake, expenditurefor implementation of the activities and formulating policiesshallindicatetheactivitiescompanywill (“Companies Act2013,”n.d.)Thecommitteeresponsiblefor of rupeesfivecroresormoreduringanyfinancialyear. turnover of rupees one thousand crores or more or a net profit having net worth of rupees five hundred crores or more or n.d.) TheStatutoryCSRisonlyrestrictedtothosecompanies director.(Sub -Section1,135“CompaniesAct2013,” more directors,outofwhichonedirectorshallbeanindependent mandatory boardcommitteewhichwillbecomprisedofthreeor institutionalises CSR within companies by constituting a act The companies. bythe undertaken be may activities CSR whileScheduleVIIexplainstheheadswhere Act 2013,”n.d.)Section135providesthesubstantivelawon 135(“Companies Act 2013,” n.d.)and Schedule VII.(“Companies the Company’s Corporate Social Responsibility in Section The Companies Act 2013 incorporates the provision relating to The CompaniesAct,2013onCSR passedtheCompaniesBill,2011on8 The RajyaSabha Bill, 2011(BillPasses),”2012) Companies 32 l Corporate Affairs - The Companies Act,” Corporate Affairs-TheCompaniesn.d.) Section 135wasnotifiedon12thSeptember2013.(“MinistryOf assent. August 2013andtheBillwassentforPresidential

Companies Act 2013. (n.d.). Retrieved January 14,2016, currency crisisinIndia?IMF Staff Papers , 395–425. the 1991 Cerra, V.,&Saxena,S.C.(2002). Whatcaused ory Corporate Soc ial Responsbility –APhilos inDecolonized Compaophical Shft ny La

CS th

l l l l l l l l l l l l l l l l l 961. 96: An Assessment. Market Reforms,1992- Gokarn, S.(1996).IndianCapital PE=browse oecdbookshop.org/get-it.php?REF=5L9LMQNHSTZS&TY 16, 2015,fromhttp://www. December (n.d.). Retrieved Economic SurveyofIndia:2007,OECDPolicyBrief(2007). Debates/Result15.aspx?dbsl=8914 13, 2016,fromhttp://164.100.47.192/Loksabha/ January Passes). (2012,12).Retrieved (Bill Bill, 2011 Companies Discussion on the motionforconsideration of the partnerships,%202003.pdf regulation%20of%20private%20companies%20and%20 Naresh%20Chandra%20committee%20report%20on%20 Retrieved from http://reports.mca.gov.in/Reports/3- Partnerships, 2003(Naresh Chandra Committee). Report onRegulationofPrivateCompaniesand Department of Corporate Affair, Ministry of Finance. (2003). Guidelines_24dec2009.pdf gov.in/Ministry/latestnews/CSR_Voluntary_ (n.d.). January11,2016,fromhttp://www.mca. Retrieved 2009. VoluntaryGuideline Corporate SocialResponsibility regulation in the global market. APLPJ, in theglobal regulation meets creative capitalism Creative proposal: responsibility Van Zile,C.(2011).India’s mandatory corporatesocial Prospects. Mittal Publications. & Reforms inIndia:Problems Economic Singh, M.(2002). India: Anoverview.TheInternationalLawyer Sharma, S. G. in (2009). Corporate socialresponsibility markets. Shah, A. (1999). Institutional changeinIndia’scapital 2016, fromhttp://164.100.47.5/qsearch/qsearch.aspx 12, January (Question).(n.d.).Retrieved Rajya Sabha market. Patil, R. H. (2006). Currentstate of the Indiancapital MinistryV2/companiesact.html 14,2016,fromhttp://www.mca.gov.in/ January Retrieved Ministry Of Corporate Affairs - The CompaniesAct. (n.d.). MCA.pdf http://www.primedirectors.com/pdf/JJ%20Irani%20Report- from (JJ IraniCommitteeReport).Retrieved Law 2005 Ministry of CompanyAffair. (2005). ReportonCompany Companies_Bill-2009.pdf Retrieved from http://www.nfcgindia.org/pdf/21_Report_ Bill 2009) (21th ReportonCompanies Finance Lok ShabaSecretariat.(n.d.). QuestionsHome.aspx from http://164.100.47.192/Loksabha/Questions/ Lok Sabha(Questions).(n.d.).RetrievedJanuary12,2016, showstat/ExportWord?Length=8 doc. (n.d.).Retrievedfromhttp://www.indiastat.com/ Growth of CompaniesinOperationIndia(1994to2000). Soc. Pol’y, An IndianSolutionfor Piketty and the Millennials. Inequality: for Reducing as aVehicle Responsibility Social Gopalan, S., & Kamalnath,A.(2015).MandatoryCorporate CompaniesAct2013.pdf from http://www.mca.gov.in/Ministry/pdf/ Economic andPoliticalWeekly, 1001–1011. Economic and Political Weekly, Economic andPolitical 183–194. 10, 34. DECEMBER 2016 w Economic andPoliticalWeekly, 956– I CHARTERED SECRETARY Standing Committeeon 13, 269. , 1515–1533. (No.21). Nw. JL& CHARTERED SECRETARY I DECEMBER 2016 33 32 DECEMBER 2016 I CHARTERED SECRETARY [email protected] Company Secretary,Ahmedabad Bhavesh A.Kinkhabwala,ACS CSR –Rethinkingthephenomenon CHARTERED SECRETARY I DECEMBER 2016 basics ofmoderntermCSR.Fewversesareasfollows:- sustainable living.SeveralversesinTaittiriyaUpanishad,Rig Ved,AtharvaVedcarrythe scriptures alsocarriesrulesandregulationsfor preservation of environment aimed for the Kutumbakam” [entireuniversebelongstothesamefamily]. Suchrichheritageofholy acts]. Upnishadashavecoinedaveryuniqueandcomprehensive conceptof“Vasudhaiva “Dharma” [balancingactbetweenowndutiesandotherrights] and“Satkarma”[good whereas ourancientscripturesandholytextsrepeatedly espousesthenotionsof the people.Atpresentmostofconceptsandtheoriesare putforwardinpiecemeal as totherestraintsonroyalautocracy,responsibilityofministers andtheauthorityof (treatises onlaw)andepics(RamayanaMahabharata) contain frequentdiscussions (deliverance). TheHinduNeetishastras(treatisesonstatecraft), DharmaShastras four goalsoflifeviz,Dharma(ethics),Artha(economics),Kama (desires) andMoksha which wasmainlyguidedbyreligiousteachings.TheVedas propoundedandnurtured Since the time of ancient India, CSR practice in India has been mainly altruistic in nature literatures likeRamayana,Mahabharataand BhagvatGita. The Origin of CSR canbetracedfromour Upnishadas, Puranas and Vedic corporate levelCSRpractices. of modern is theverybasis tradition and knowledge ancient Our rich industries. to thecorporatehousesand hasgivendirection moment issuchancientwisdom the proud and for CSR a platform framed has wisdom and ourancient India ancient countries.But,thefactisthatconcept ofCSRhasexistedin from theforeign theconcept India hasborrowed and countries in foreign done have been many things While doingweb search aboutCSRandpoliciesapparently onefeelsthat lot FROM FOREIGNCOUNTRY ORIGINATED INANCIENTINDIAANDNOTACONCEPTBORROWED Policies. ofCorporateSocialResponsibility of theimplementation monitoring for improved measures so astosuggest was submittedinSeptember,2015 which Affairs [MCA],GovernmentofIndia Committee setupbytheMinistryofCorporate Level to takenote ofthereportHigh be alsointeresting outlook. Itwill sensible with apassageofCSRcanbeimbibeddifferent time now,thephenomenon Act, of newCompanies2013and premier corporatehousesonly.Withtheapplicability for few was somewhatconcern CSR wasinnascentstageand of CSRwhen basics [CSR]” carrying Responsibility Social Secretary andCorporate with atitle“Company bythesameauthor In theyear2009,anarticlein“CharteredSecretary”waspublished BACKGROUND n n n n n n n

in itsrightperspective. can behelpfulforsharpeningtheoverallattitudetakingCSR ISO certification and CSR standards are the future lessons that through legalcomplianceseemsjustifiabletocertainextent. development ofIndia, CSRimplementationbycompulsion Looking to the overall need for the holistic growth and Earth, atmosphere, sky, sun, moon, stars, waters, plants, trees, moving creatures, fortodayandtomorrow.(RigVedaSamhitavi716) One shallproducefairwealth Let therichsatisfypoorwith abroadervision.(RigVedaSamhitax1175) Samhitaxxx4) The leaderisthedistributorof wealth.(Vajasaneya wondrous One shallnot be selfishandconsume allbyitself.(RigVedaSamx1176) Help otherstowinwealth.(Rig VedaSamhitaiv509) A manshallstrivetowinwealth bytherighteouspath.(RigVedaSamhitax312) 33

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n n n n n n n n n n n n n n CSR –Rethinkingthephenomenon 34

whom doesitbelong.) it wellasto quota andmustnotacceptotherwise knowing accept thingsnecessaryfor him asitissetasidehis therefore by theLord.Oneshould owned and is controlled (Everything animate or inanimate that is withintheuniverse Ishavasya Upanishad) tyaktena bhunjitha ma gridhah kasyasid dhanam. ( jagat tena Isha vasyamidamsarvamyatkimchajagatyam Samhita x524) Waters areto be freedfrom defilement. (AtharvaVeda Samhita vi395) Veda (Rig poison. have no should herbs Waters and rime, streams,riversandocean.(TaittiriyaSamhitavii413) clefts, holes,lakes,morasses,ponds,tanks,marshes,rains, Offerings should be dedicated to waters of wells, pools, Veda Samhitavii10410) sinks both himself and hisoffspringintodestruction.(Rig who is arobber mountains theforestsand injures Whoever Samhita iv2) (Vajasaneya Waters bearoff alldefilements andcleansepeople. Samhita vii704) Veda (Rig treasures forgenerations. waters are Plants and Veda Samhitavii758) (Rig Nature hastobeprotectedfromman’sexploitation Veda Samhitax975) (Rig Trees arehomesandmansions. x974) Samhita Veda Goddesses. (Rig Plants aremothersand vi4817) One shouldnotdestroythetrees.(RigVedaSamhita (Atharva Veda) to purifytheair. by everyone beperformed should Yajna (Atharva Veda) be freefrompollution. it should Air isGod(vayudevta)and vi713) protect thehabitation.(RigVedaSamhita One should offered oblations. offered oblations. (TaittiriyaSamhitai813) swimming creatures, creeping creaturesallarehailedand efficiency andbetteroutcomes. management skillsandwithgreater with theirinnovative ideasand discharging theirsocialresponsibility indeed toinvolvethecorporatesin The objectiveofthisprovisionis taxes/cess onthesecorporates. been metbylevyingadditional infrastructure, couldaswellhave for suchdevelopmentorsocial since theresourcegap, ifany, for socialandhumandevelopment is nottogeneratefinancialresources The rationalebehindCSRlegislation to amongtheentiresociety. distribution equal and concerned with all of sharing emotion and rather needstobedoneasadutythesocietywithmindset contribution must not have any expectationsinreturnbut offered to the divine. In the CSRcontext, the societal fruits thereof– andwhereboththeactionfruits are deeds withoutattachment tothe one’s performing emphasizes outlook foranactionandimplementationof decisions The responsibility-through-spiritual-leadership-business-essay.php) (https://www.ukessays.com/essays/business/corporate-social- entire society. dharma isuselessbecauseapoorpersoncannotsupportthe toothless (dharmasyamoolamartha),andwealthwithout to Kautilyais according dharma). Dharmawithoutwealth doing thingsrightlyandright(sukhasyamoolam happiness is obtained not only by wealth andprofit, but also by Hestatedthat of allstakeholders. narrates thewellbeing society andaconceptof sustainability. In other wordsit the of serving offers thepillar carries “sarvalokahitam”which 4th century BCalsocarriesgenesisof CSR. Vedicliterature Kautilya’s Arthashashtra,roots found inRigVeda, written in Governance. of Corporate carries theorigin texts which In addition to above, there aremanygenesisfoundinourholly – spendingmoneyonself,donationanddisruptionofmoney. being andthesociety.Therearethreewaystousemoney “Artha” is given utmost importance as it serves needs of human they areinhierarchyandtheultimategoalistoattain“Moksha”. “Artha” be soughtinthehumanlife,theseare“Dharma” As said earlier our Vedic tradition has identified four objectives to n n modern concept calledthe“CorporateSocial Responsibility”. essence whichisreflected capture thestartingpointof today’s but, the outdated orunjustified and maysound are debatable “Trusteeship” in thebook coined concepts and Some points the remainderforsociety...” “.. Take whatyourequirefor your legitimateneeds,anduse the community...” of to thecommunityandmustbeusedforwelfare belongs than thatbymillionsof enjoyed others. Therest of my wealth no better livelihood, to meistherightanhonourable belongs to me;what “…I mustknowthatallwealthdoesnotbelong the followingexcerptsfrombooklet“Trusteeship”: of trusteeship of surplus wealth. It will be useful to go through modern genesis of CSR is also routed in the Gandhian principle held byoneselfintrustforsocietyandusedaccordingly. The According toGandhiji,thewealth,inexcessofone’sneeds is “ people or interestsofthecountryand its it servestheneeds unless in materialtermsisworthwhile “No successorachievement CSR: and inturn the “Trusteeship” quote byJ.R.D.Tatasignifies many thingsfor corporate to learn fromthebook. Following thatthere arelot it appears booklet the said through going grasp. After and to read worthwhile is really – “Trusteeship” small bookwrittenbyLateShriMK.Gandhi A veryvaluable GANDHIAN PRINCIPLEOFTRUSTEESHIPANDCSR

Veda Samhita). not beselfishandconsumeallbyhimself.(Rig One shall distributed to1000hands(AtharvaVedaSamhita). Wealth accumulatedthrough100handsshouldbe Bhagavad-Gita coins the concept of nishkama karma; an coins theconceptofnishkama Bhagavad-Gita g Money, “Kama” DECEMBER 2016 g urges and“Moksha” I CHARTERED SECRETARY g g salvation and salvation and value system, value system, CHARTERED SECRETARY I DECEMBER 2016 35 34 DECEMBER 2016 I CHARTERED SECRETARY EXPECTATIONS TOEARN RETURNS segment ofthenation. and underprivileged for thebettermentofsociety knowledge skills andprofound come forward andsharetheirdynamic should Corporates politicians andGovernment. For the societal goodcause cannot leaveeverythingunderthedomainandtomercy of access to the decent living.In such a type of environment we to have an it isthebasicbirthrightforahumanbeing whereas achievement as an things of materialistic a possession and living In Indiaweperceiveadescent all arestillabigchallenge. and growth to to thedevelopment access totheopportunities with less along underdevelopment and regional of large benefit to the exploited not been have disparities regional population of theentire portion a reasonable and for many challenge as a cloth, sanitation water, food,shelter, like necessities India westillfacedifficultiesinmeetingtheverybasic living. In large andforbeingameanstotheendofsustainable be intheinterestofsocietyat itwould because welcomed implementing relevant rules and regulations should be push isrequiredtheninitiallyasortofcompulsion by vision isfor at sustainable developmentmacrolevelanda motivation. Thisshouldbethecasebut, when theobjectand by self to bedone anything if causing it isgood compulsion out of anything of driving that instead it issaid In general objective isnotdefeated. so thatthis CSR resources the companies’ to ring-fence felt thatthereisaneed strongly of thesociety,Committee for optimalbenefitsofsections the poorandunder-privileged / projectsaretakenup programmes and thatonlysustainable the resourcessogenerated frittered awaybythinlyspreading is not that thisopportunity sections ofsociety.Toensure under-privileged and poor of thedeserving funds forthebenefit mandatory provisionof CSR islikelyto generate substantial special attentiontotheneedsofunderprivileged.The with of thepeople, and /orpromotesthewellbeing purpose good andforanyactivitythatservespublic for largerpublic Further, thesaidReportsuggeststhatCSRactivitiesmustbe by thecompanies. delivery of‘publicgoods’isatthecoreCSRimplementation Use ofcorporateinnovationsandmanagementskillsinthe interpreted asasourceoffinancingthegapsininclusivegrowth. efficiency andbetteroutcomes.Therefore,CSRshouldnotbe innovative ideasandmanagementskillswithgreater the corporatesindischargingtheirsocialresponsibilitywith corporates. Theobjectiveofthisprovisionisindeedtoinvolve as wellhavebeenmetbylevyingadditionaltaxes/cessonthese gap, ifany,forsuchdevelopmentorsocialinfrastructure,could resources forsocialandhumandevelopmentsincetheresource rationale behindCSRlegislationisnottogeneratefinancial Further, intheaforesaidreportithasbeenmentionedthat Act, of theCompanies2013. CSR provisions of compliance years, fornon two tothree for theinitial least report hassuggestednottotakeactionsagainstcompanies,at The HighLevelCommittee[HLC]setupbytheMCAinits Act, corporate entitiesvideCompanies 2013. mandatory enforcement provisions relatingtoCSRforcertain India isthefirst and onlycountry across theglobehaving PENALTY CLAUSE COMPULSION REALLYNEEDED?IFYES, Many perceive CSR spendsasanexpense, cost[burden]and Many perceive CHARTERED SECRETARY I DECEMBER 2016 its forms,extortionand bribery. including in all corruption work against should 10: Businesses Principle Anti-Corruption friendly technologies. environmentally and diffusionof the development 9: encourage Principle responsibility; environmental greater topromote initiatives undertake 8: Principle challenges; approach toenvironmental Principle 7: Environment employment andoccupation. in respectof of discrimination 6: theelimination Principle 5: theeffectiveabolitionofchildlabour. Principle labour. of allformsforcedandcompulsory 4: theelimination Principle collective bargaining. association and the effective recognition of the right to Principle 3:Businessesshouldupholdthefreedomof Labour rights abuses. in human 2: makesurethattheyarenotcomplicit Principle proclaimed humanrights. protection ofinternationally Principle 1: Human Rights and anticorruption. standards, theenvironment rights, labour in theareasofhuman set ofcorevalues a of influence, their sphere enact, within and support embrace, Compact. The UNGlobal Compact asks companies to Global Nations the thenformedUnited as including well companies, as together theexpertisefromanumberofleading Corporate SocialResponsibilities. Thisframeworkdrew their to managing adopted they had the approaches improve assess and with aframeworktohelp organisations provide to for CSR the framework produced Management) for Quality In 2004EFQMFoundation (formerly knownastheEuropean EFQM FRAMEWORKFORCSR Responsibility released on 1stNovember, 2010.It released was oneof Responsibility on Social by ISO/TMB group was prepared Working 26000 ISO basis canbeadopted. but,onvoluntary is notmandatory and standard is aguidance Responsibility on Social ISO 26000 ISO 26000 money makingbase. stands foranoblecausewhichgoesbeyondtheprofitsand the firm that considering and attractstheconsumers house business of loyal up animage supports building definitely today’s eraof cut throatcompetitionsuchavisionofCSR terms but,in in financial returns directly not earn will certainly spends CSR their brands. to promote tool asameans CSR part ofsocietalmarketing,causerelatedmarketinganduses CSR asa views activities of strategicmarketing an approach with segment retail into FMCGand falling Mostly, companies performance. financial to higher claims thusleading implicit claims andahighCSRdrivenimagemaylowerthecostof on bothexplicitandimplicit concept thatafirm’svaluedepends spent. However CorporateStakeholdertheory has coineda cost oftheamountCSR get carriedawaybytheopportunity Businesses should support andrespect the Businesses should support a precautionary CSR –Rethinkingthephenomenon 35

ARTICLE ARTICLE Respect • Respect • Ethical • private sector, where a company mayseeCSR activitybothas private sector, where acompany by gets dovetailed levels ofmeritgoods.This deficiency efforts are necessary,they not sufficienttoprovideoptimal governments’ all overtheworld suggeststhatwhile Experience AN EELESCAPESFROMTHE GOODFISHERMAN Respect • Transparency: • Accountability: • 26000 Seven principles ofsocialresponsibility enshrined inISO in thetimetocome. norm forSocialResponsibility to setthe is expected standard The ISO26000 environment. the on societyand actions impacts ofanorganization’s as the which isunderstood of organizations, responsibility social the improving continuously and implementing Standard ISOonunderstanding, 26000 providesguidance The International acceptance. and attention global received and the mostbyISO comprehensive standardseverdeveloped CSR –Rethinkingthephenomenon 36 Fair • Environment • Labor • Human • Organizational • are: should consider, The SevenCoreSubjects,whicheveryuserofISO 26000 Respect • Community • Consumer • respond totheinterestsofitsstakeholders. right orgoodconduct that impactonsocietyandtheenvironment. the environment. and activities andtheirimpactsonsociety,theeconomy operating practices behavior: rights for for for for issues involvement rule international human stakeholder practices governance Openness of Being In law: accordance rights mandatory answerable and norms interest: about development with of decisions behavior Respect, accepted for decisions and consider principles activities and and of

(IT) services company Tata Consultancy Services Ltd (TCS) Services Tata Consultancy (IT) servicescompany Rs.2,167 croreinFY16. Among thelot, information technology rose 22%to to FY15, theirspend that whencompared shows ofthe33companies A firstlookattheCSRspending (NGOs) organizations across 450projectsduringtheyear. with morethan150non-governmental partnered that companies shows the legacyofFY15continues. Itsanalysis preliminary Rules playedout, what theearlytrendsareandwhetherornot 2016 inaneffort to understand howthesecondyearof CSR theexercise,withacut-offdateof8July, company, undertook CSR management NextGen, aBengaluru-based However, is notmuchencouraging. it isclearthattheparticipation From the abovefactsto pertaining thefinancialyear2014-15, Act, Companies 2013. section 206(1)toshowcauseunder450of the under issued and thatlettershavebeen on CSRspend carries a news thatwere 100 companies servedwith notice At the sametimeEconomicTimesdated16thJuly,2016 companies spent 76% ofthemandatedCSRexpenditure. 71% ofwhereasprivatesector the mandatedCSRexpenditure PSUs spent CSR expenditure. 76% ofthemandated nearly spent was that totalamount it isclear table From theabove CSR expenditureduring 2014-15 (in Rs. Crore) details : following as per 2014-15, the year during crores at Rs.6337 estimated returns onCSRtheirwebsitesis annual have placed May, 2016 CSRexpenditureof 460 listedcompanies,which answered bythe Minister of Finance ShriArunJaitleyon3rd no. 999 question unstarred Sabha to Rajya In response spending themandatedamountwas: mandated amountonCSR.Thetop3reasonsstatedfornot carries :32(64%)oftheNiftycompaniesdidnotspend companies hadspentRs.3989crores.Further,saidreport Against the recommended amount of Rs.5046 crores, the 47 79% oftheamountmandatedunderCompaniesAct. Services Pvt.Ltd.inDecember,2015:Niftycompanies spent Analysis” publishedbyCimplyFiveCorporateSecretarial As per“IndiaSecretarialPractice2015-Nifty50AnnualReports (Deodhar, 2015). creating proposition for strategic brandbuildingexercise a virtuousactionofcorporatecitizenandvalue a responsible 3) 2) 1) No. Sr. No. Sr. 2) 1) Company Type Total :- Companies Private Sector PSUs multiyear projectbeingexecuted CSR projects amount sanctioned, next financialyear implementation spillingintothe CSR projectssanctioned, capacity tospendbeingbuilt First yearofCSRmandate, Mandated Amount Reason fornotspendingthe DECEMBER 2016 Companies No. of 460 409 51 I CHARTERED SECRETARY 4 9 12 Number ofCompanies spent Rs. Amount 6337.36 3950.76 2386.60 Expenditure Rs. Mandated CSR 8347.47 4987.63 3359.84 13 28 38 % CHARTERED SECRETARY I DECEMBER 2016 37 36 DECEMBER 2016 I CHARTERED SECRETARY CSR have seen companies headed intherightdirection. CSR haveseencompanies the firsttwoyearsof experts believe projects. Onthewhole, are focusingonlargerandlonger-term 15% ascompanies up by about ticket sizehasgone and theaverage companies byRs.350croreforthe33 spent bycompanieshasincreased Ltd missedbyahugemargin.ThequantumofCSRcapital And some,likeKotakMahindraBankLtdandHindustanZinc not meetthe2%benchmark. did surveyed of the33companies 16 In all, the othertoptwospenders. Infosys Ltdwere Ltd and spent Rs.294croreandemergedasthebiggestspender.ITC CHARTERED SECRETARY I DECEMBER 2016 adhered to for the sensible implementation of CSRagenda. implementation to forthesensible adhered be should standards various and ratings benchmarking, of theworkdone.Inaddition, the sustainability examines which be introduced should CSR audit audit social Just like uplifting the target group shouldbeanintegralpart of agenda. and Well being approach. corporate andnotacharityoriented by a approach carry thestakeholder should CSR agenda agenda. business and betreatedlikeanactionable and budget and notcontributory. CSRshould bepartofcompanystrategy that ofparticipatory be should approach with CSR dealing While strategiestogaincompetitiveadvantage. the corebusiness Strategic CSRisallaboutintegratingthe societal issuesinto be theinstrumentto overcome anyhurdlesto the pathway. should Responsibility Social toCorporate Strategic approach SUGGESTIONS country intoawelfarestate. witness CSRasoneof the catalyst for the transformationof the the needforCSRbyMCAisexpectedsoasto sensitizing education, continuous picture inyearstocome.However, can expectabetter stakeholders with anoptimisticapproach of CSRand of timeforCorporatetofullygrasptheessence inIndia.It far asCSRstratumisconcerned couldbeamatter from the goodfisherman”mayseeturningpointinfutureso From the above it seems that the old proverb“An eel escapes RvFO/CSR-gets-greater-acceptance-in-year-two.html) (http://www.livemint.com/Companies/3WSHLVqdonhIbh6bMR 8) http://www.livemint.com/Companies/3WSHLVqdonhIbh6b CSR, Processof mandatory Satish Y,“India’s Deodhar 7) Trusteeship–LateShriMK.Gandhi 6) 5) www.ind.tuv.com 4) http://www.efqm.org/ 3) https://www.ukessays.com/essays/business/corporate- B. Muniapan, andDass,M.Social (2008) ‘Corporate 2) returns? A yield Responsibility Social Does Corporate 1) REFERENCES : two.html retrievedon17thOctober,2016) onhIbh6bMRRvFO/CSR-gets-greater-acceptance-in-year- (Source :http://www.livemint.com/Companies/3WSHLVqd MRRvFO/CSR-gets-greater-acceptance-in-year-two.html 2015. May W.P. No.2015-05-01, – IIM-Ahmedabad, Publications and Research of spending”, and channels compliance 2016) retrieved on17thOctober, leadership-business-essay.php business/corporate-social-responsibility-through-spiritual- essay.php (Source:https://www.ukessays.com/essays/ social-responsibility-through-spiritual-leadership-business- Management, Vol.1,No.4,pp.408–420 Indian perspective’, Int. J. Indian CultureandBusiness approach fromanancient a philosophical Responsibility: Tirthankar Nag & Prof. firms –Prof.AsishK.Bhattacharyya study ofIndian CSR –RETHinkinGTHEPHEnoMEnon

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ARTICLE ARTICLE [email protected] Ahmedabad Zone Ltd. Adani Ports&SpecialEconomic Company Secretary Dipti Shah,FCS Responsibility Social Audit andCorporate Social 38 social contributionofbusiness. such while adevelopmentaudithasbroaderfocusincludingenvironmentandeconomicissues, audit andsocialisthatafocusesontheneglectedissueofimpacts, Social Audit is different from developmentaudit. The key difference between development social performanceofanygovernmenteffortororganization. • SCOPE environmental responsibilities. business meettheexpectationsyourstakeholdergroupshaveregardingsocialand social responsibilityobjectives.Itevaluatesmeasurablegoalsintendedtohelpyour A corporatesocialauditisanassessmentofacompany’sperformanceon DEFINITION efficiency A socialaudithelpstonarrowthegapsbetweenvision/goalandreality; concept waspioneeredbyCharlesMedawarin1972. performance toitsstakeholdersandseeksimprovefuturesocialperformance.The Social auditisaprocessbywhichanorganization/governmentaccountsforitssocial INTRODUCTION OFSOCIALAUDIT It isthusaprocessandnotanevent.” carried out,asfarpossible,withtheconsentandunderstandingofallconcerned. “Social audit isbasedon the principlethat democratic local governance should be • OBJECTIVES and foreachsubject,theSocialAuditorwillanalyzeexpectations ofallstakeholders. company’s SocialPolicy(Ethics,Labor,Environmental,Community, HumanRights,etc.), their immediateinterest.Asaresult,theSocialAuditorwillwork onthecomponentsofa to beconsideredasawhole,becausetheirconcernsarenot limitedtothedefenceof Social Auditordoesnotstudyeachgroupofstakeholdersseparately. Stakeholdershave The • • • has madeCSRmandatory. which repealedtheoldcompanylaw, i.e. The Companies Act, 1956, It hasalotmorestrategicsignificance. The Companies Act, 2013, the CSR aspect if it wants to sustain its competitive advantage. In any business CSR is imperative. No business can afford to ignore Creating local development. Assessing services. Estimation oftheopportunitycost forstakeholdersofnotgetting timely access to public particularly ofruralpoor. Scrutiny ofvariouspolicydecisions, keepinginviewstakeholderinterestsandpriorities, Increasing efficacyandeffectiveness oflocaldevelopmentprogrammes. services. identification as the and efficiency awareness effectiveness. the of physical the of among stakeholders a and project It allows financial beneficiaries or programme. us is gaps to generally measure, DECEMBER 2016 and between providers It the Monitors, verify, needs first I task of CHARTERED SECRETARY report and local appraises of resources on an social and audit. and and to available improve However, productive measures the for a CHARTERED SECRETARY I DECEMBER 2016 39 38 DECEMBER 2016 I CHARTERED SECRETARY can begin meeting philanthropic responsibilities. Philanthropic If acompanyisabletomeet allofitsotherresponsibilities,it Philanthropic Responsibilities higher levelresponsibilitiesthat benefitsociety. that obligateittoshareholders andthelaw,itcanmoveonto to thebottom.Asabusiness meets lower-levelresponsibilities can bearrangedinapyramid,withbasicresponsibilitiescloser have multipleresponsibilitiestomaintain.These The ideabehindcorporatesocialresponsibilityisthatcompanies Four TypesofCorporateSocialResponsibility in ScheduleVlloftheAct. to theconditionthatsuchpolicywillcoversubjectsenumerated of the Board as Per declared CSR policy of the company subject (board) in pursuance of recommendations of the CSR Committee to activitiesundertakenbytheboardofdirectorsaCompany in Schedule VII to the Act or Projects or programmers relating not Corporate Social Responsibility (CSR) means and includes but is What isCSR protection throughvariousprojectsandprogrammes. research andcultural),communitydevelopmentenvironment has included,inadditiontoinstitutionalbuilding(educational, of CSR in India still remains within the philanthropic space, but philanthropic activity. Post Companies Act 2013, the practice CSR and others have helped building the society through India. Traditionally,inIndia,bigcorporatehouseshaveadopted The conceptofsociallyresponsibleorganizationsisnotnewto concept anditsimplementation. Business.. Sincethen,therehasbeencontinuousdebateonthe academic topicinHRBowens,SocialResponsibilitiesofthe The integrate socialandenvironmentalconcernsintheirbusiness. It refers to strategies and activities through which companies Corporate SocialResponsibility(CSR)isamanagementconcept. Introduction CORPORATE SOCIALRESPONSIBILITY(CSR) and recognizeitssocialimpactinthecommunity. society so that the organization receives the correct information points mustrepresenttheapplicabledepartmentorsegmentof from allpartiesineachstageandauditareaisvital.Theseview are receivedbysocietyatlarge.Obtainingrelevantpointsofview assess it isimportanttoidentifyandinvolvethemintheaudit.Theyhelp Those withavestedinterestincompanyarestakeholders,and STAKEHOLDERS example, don’texploitchildrenformanufacturingtheirproducts. that appeartobeethicallyconscience.Thesecompanies,for Additionally, customers might more favorably view organizations gain motivation when companies perform corporate social audits. Working environmentsmightbecomesafer,andemployees shortcomings andpossibleareasmethodsofimprovement. with givingvitalinformationtotheexecutivesaboutcompany’s operations. Suchanauditresultsinagoodpublicimagealong personnel intheorganizationwhoseekdetailsaboutits Corporate socialauditsareoftenpursuedbykeymanagement BENEFITS limited idea CHARTERED SECRETARY core of to areas CSR Projects first of or operations came programs I DECEMBER 2016 up while in relating 1953 identifying to when activities it benefits became specified that an refusing todobusinesswithoppressivecountries. include being environmentally friendly, paying fair wages or they haveanobligationtodoso.Ethicalresponsibilitiescould because its owners believe it’s the right thing to do -- not because responsibilities arethatacompanyputsonitself a companycanconcernitselfwithethicalresponsibilities.Ethical a company.Aftercompanyhasmetthesebasicrequirements, Economic andlegalresponsibilitiesarethetwobigobligationsof Ethical Responsibilities causes. projects toaidtheenvironmentordonatingmoneycharitable by donating services tocommunity organizations, engagingin They what issimplyrequiredorthecompanybelievesright. responsibilities arethatgoaboveandbeyond placed A company’slegalresponsibilities aretherequirementsthat Legal Responsibilities ensuring thatit obeys alllawsisthemostimportant responsibility, efficiency andbetteroutcomes. management skillsandwithgreater with theirinnovative ideasand discharging theirsocialresponsibility indeed toinvolvethecorporatesin The objectiveofthisprovisionis taxes/cess onthesecorporates. been metbylevyingadditional infrastructure, couldaswellhave for suchdevelopmentorsocial since theresourcegap, ifany, for socialandhumandevelopment is nottogeneratefinancialresources The rationalebehindCSRlegislation involve on it by making the Social Audit anCorporate SocialResponsbility law. an Next effort to ensuring to benefit that society company -- for is profitable, example, 39

ARTICLE ARTICLE business Corporate social responsibility generates direct and indirect Importance ofCorporateSocialResponsibilitytosocieties A Economic Responsibilities law, environmentallawandevencriminallaw. responsibilities can range from securities regulations to labor according tothetheoryofcorporatesocialresponsibility.Legal Social Audit anCorporate SocialResponsbility 40 it. b) a) expenditure for the following companies– Every company having- Section 135(1) of Companies Act 2013 mandates the CSR Applicability ofCSRProvision underCompaniesAct2013 been takenintoconsideration for structuringtheCompaniesAct. 2013) cameintoforce.InfactvariouspropositionsfromNVGhave responsible entitiesmuchbeforetheCSRAct(Companies Act- designed withtheaimofassistingenterprisestobecome irrespective ofsize,sectororlocation.Theseguidelineswere National voluntaryguidelinesareapplicabletoallbusinesses National VoluntaryGuidelines(NVG) • • • • • • • • following adopting corporatesocialresponsibilityinitiativesmayobtainthe Basic constituentsofCSR profitable. good social responsibilities.Beforeacompanythinksaboutbeing company won’tevenbeabletothinkabouttakingcareofits not makemoney,itwon’tlast,employeeswilllosejobsandthe turning that is to say, a company needs to be primarily concerned with development economic towards Sustainable Contribution managers. to ownersand only responsible corporation is industrialisation; charity during philanthropy and Purely company’s In (1850 -1914) Turnover ofRs.1000 croreor Net worthofRs.500crore,or Increased customerloyalty. Avoiding stateregulation. Less volatilestockvalue. value. Bolstering publicimageandreputationenhancedbrand Increased qualityofproductsandservices. Less litigation. Gaining legitimacyandaccesstomarkets. Increased employeeloyaltyandretention. Phase 1 synthesis, corporate a profit. benefits first This citizen, the and employees. owners, managers responsible to corporation is struggle; Independence during the development CSR associal Social change Make desirable and responsibility (1910 -1960) Phases ofEvolutionCSR is Phase 2 benefits advantages for it first the and simple needs is environments. and othertarget owners, managers responsible to corporation is paradigm”; “mixed economy CSR underthe advantages (1950 -1990) Social environment Improvement of its to Phase 3 to fact the economic make that corporation sure if that a the publicatlarge. environments and other target managers, to owners, is responsible state; corporation is inaconfused globalized world CSR ina responsibility company (1980 onwards) that corporations Phase 4 that Business and it Towards Society can adopt does be -- than 8 oftheActoraregisteredtrustsociety,other its CSR activities through a company established under section Provided that-if,theBoardofacompanydecidestoundertake (b) (a) activities approvedbytheCSRCommittee,through The Board of a company may decide to undertake its CSR its normalcourseofbusiness. new or ongoing), excluding activities undertaken in pursuance of its statedCSRPolicy,asprojectsorprogramsactivities(either The CSRactivitiesshallbeundertakenbythecompany,asper CSR activities The Committee shall institute transparent monitoring mechanism. and approvetheCSRpolicyofcompany. into accounttherecommendationsmadebyCSRCommittee and monitortheCSRpolicyofcompany.TheBoardshalltake amount ofexpendituretobeincurredontheactivitiesreferred shall indicatetheactivitiestobeundertaken;recommend formulate andrecommendtotheBoard,aCSRpolicywhich consisting ofthreeormoredirectors.TheCommitteeshall Committee (‘Committee”)oftheBoardDirectors(“Board”) Every qualifying company will be required to constitute a CSR CSR Committee Section 381ofCompaniesAct2013. purpose ofthiscalculationshallbemadeasperSection198and Turnover, Section. 135andrelatedRules.

Act Net directors outofwhich1shallbeindependentdirector. Need toformulatetheCSRCommittee;itshallhaveminimum3 netprofitofRs.5.00crore c) A company may also collaborate with other companies for and themonitoringreporting mechanism.] modalities ofutilisationfunds ofsuchprojectsandprograms has in undertakingsimilarprograms orprojects;andthecompany society shallhaveanestablished trackrecordofthreeyears a Foreign CompanyorHoldingSubsidiaryhaving required tofollowtheprovisionofCSR. to comeinabovecriteriaforconsecutivethreeyears,theyarenot If any company on which CSR provisions were applicable ceases in IndiacoveredunderSection135. company and dividend received from other companies received Foreign Company Company Private Limited Company Unlisted Public Listed Company branch 1956, established underanActofParliamentoraStatelegislature: Central Government or State Government or any entity registered trust or a registered society, established by the A company established under section 8 of the Act or a company, eithersinglyoralongwithanyother registered trust or a registered society, established by the A company established under section 8 of the Act or a Types ofthe Profit specified those company office excluding Net to specified be the profit or calculated projects project DECEMBER 2016 and theothernominatedbyForeignCompany. 2 Persons,outofwhich1shouldberesidentinIndia 2 Directors,IDnotnecessary 3 Directors,IDnotnecessary be anIndependentDirectors(ID). Minimum 3DirectorsoutofwhichATLEAST1should profit in or Nature andnumberofcommitteemembers this Net office arising or sub-rule, under worth programs in I from CHARTERED SECRETARY India Section of such such overseas to shall company be 198 Company also undertaken, of branch comply Companies or trust for of with the the the or CHARTERED SECRETARY I DECEMBER 2016 41 40 DECEMBER 2016 I CHARTERED SECRETARY Policy and the prescribed expenditure of the Company is The Boardshallensurethatthe activitiesincludedintheCSR displayed onTheCompany’sWebsite. The content disclosing the CSR in Board Report should also be of itsspending,reasonincasefailureetc. following: CSR policyshouldspecifythatthecorpuswillinclude the plans toundertakeandmonitoringprocessoftheproject. It includes a list of CSR Projects or programs which a company CSR PolicyistheCharterforActivatesofCompany. CSR Policy income. Any Surplus arise in CSR Project is not a part of the business g g g g CSR Activitiesdoesn’tincludetheactivitiesundertaken CSR spending. incurred onsuchcollaborativeeffortswillqualifyforcomputing companies toundertakeCSRactivitiesandanyexpenditure Companies may collaborate or pool resources with other only shallamounttoCSRExpenditure. the CSR projects or programs or activities undertaken in India Subject to provisions of sub-section (5) of section 135 of the Act, accordance withtheserules. in a position to report separately on such projects or programs in manner that the CSR Committees of respective companies are undertaking projectsor programs orCSR activities insucha Committee, pertaining toOverviewofCSRPolicy,Composition the Responsibility Policy)Rules,2014,whichcontainsparticulars the formatasprescribed in the Companies (Corporate Social The Board Report shall include an annual report on CSR in Yearly AnnualCompliances/disclosure g g g g g g Core ElementsofCSRPolicy displayed intheCompany’swebsite,ifany. CSR policy as approved by the committee and Board shall be shall notformpartofbusinessprofitsthecompany. CSR Policytospecifythatsurplusarisingoutofactivities Sch –VII. Board to ensure that activities under CSR Policy are included in course ofbusiness. schedule, monitoring process, excluding activities under normal Sch –VII,modalitiesofexecutionsuchprojects,implementation Projects orprogrammeswhichacompanyplanstoundertakewithin CSR Policywillincludethefollowing: thereof; c)SurplusarisingoutofCSRactivities. political party. To contributionofanyamountdirectlyorindirectlyto for thebenefitonlyofemployeesandtheirfamilies outside India in thenormalcourseofbusiness. Activities forSocialandInclusiveDevelopment Respect forEnvironment Respect forHumanRights Respect forWorkers’RightsandWelfare Ethical functioning Care forallStakeholders CHARTERED SECRETARY a) Avg. 2% Net of average Profit, I DECEMBER 2016 prescribed net profit; expenditure b) any income and arising details (vi) (v) until CSR Rule,2014,suchcompanywouldhavebeenrequiredtowait with the provisions of the aforesaid section read with Companies year (i.e.F.Y.2014-15)andconsequently,requiringcompliance (iv) ii Expenses (iii) “Circular”) vide its General Circular No. 21/2014 dated June 18, 2014 (the However, Ministry of Corporate Affairs, Government of India commenced fromthenextfinancialyear(i.e.F.Y.2015-16). F.Y. 2014-15.Inotherwords,thecomplianceactionwouldhave the determining Earlier a view was being formed that for the purposes of Financial year Clarifications onCorporateSocialResponsibility– undertaken /spentbytheCompanyinrespectivemanner. (ii) (i) Clarifications withrespecttootherissuesrelatingCSR: provisions ofsub-section(1)Section135theAct. year 2011-12and/or2012-13arealsorequiredtocomplywiththe financial companies whoarenotmeetinganyofthethresholdcriteriain of theActreadwithCompaniesCSRRule,2014.Even immediately required to comply with the provisions of section 135 millions ormore,inanyofthethreeprecedingFinancialyearsare more; orturnoverofINR10billionsmorenetprofit50 Resultantly: CompanieshavingnetworthofINR5billionsor 2014, implies‘anyofthethreeprecedingfinancialyears’.” 135 oftheActreadwithRule3(2)CompaniesCSRRules, “Any Act which,interalia,include: Corporate SocialResponsibility(“CSR”)undersection135ofthe net CSR Rules,2014)wouldinclude trustsregisteredunder Registered Trust(asreferredin Rule4(2)oftheCompanies do soaspersection135ofthe Act. Indian subsidiariesandifthe subsidiaryisrequiredto subsidiary if,theCSRexpenditures areroutedthrough activities inIndiawillqualifyasCSRspendoftheIndian Expenditure incurred by foreign holdingcompany for CSR CSR projectcostaspartoftheexpenditure. time/hours as tovolunteersofthecompanies(inproportioncompany’s Salaries paidbythecompaniestoregularCSRstaffaswell under theAct. Acquisition Act etc.) would not count as CSR expenditure Act/ statute of regulations (such as Labor Laws,Land as partofCSRexpenditure. sponsorships marathons/ awards/charitablecontribution/advertisement/ Companies CSR Rules, 2014). One-off events such as in project/ programme mode (as referred in Rule 4 (1) of CSR activitiesshouldbeundertakenbythecompanies illustratively mentionedintheAnnexuretoCircular. based andareintended to coverawiderangeofactivitiesas The itemsenlistedintheScheduleVIIofAct,arebroad- capturing the essence of the subjects enumerated therein. mentioned intheScheduleVIImustbeinterpretedliberally must relatetoScheduleVIIoftheActandactivities The activitiesundertakeninpursuanceoftheCSRpolicy the financial worth, determination year has the 2013-14 clarified year” or incurred spent eligibility Social Audit anCorporate SocialResponsbility turnover, of TV referred specifically but of certain by programmes the criteria, were companies or financial under issues net meeting i.e., on profit Sub-Section CSR) with etc. position whether for the criteria regard would the can same of a fulfillment be in not the company to in (1) this factored provisions the be company of 41 qualified financial financial Section of fulfils into any of in

ARTICLE ARTICLE Contributions orfundsprovided totechnologyincubatorslocated women; the ScheduledTribes,otherbackward classes,minoritiesand development and relief and welfare of the Scheduled Castes,. other-fund setupbytheCentral Governmentforsocio-economic Contribution to the Prime Minister’s National Relief Fund or any paralympic sportsandOlympic sports; Training topromoteruralsports,nationallyrecognised and theirdependents; Measures traditional artsandhandicrafts; art; settinguppubliclibraries;promotionanddevelopment of of buildingsandsiteshistoricalimportanceworks of Protection of national heritage, art and culture including restoration up bytheCentralGovernmentforrejuvenationofriverGanga; air and water including contribution to the Clean Ganga Fund set- conservation ofnaturalresourcesandmaintainingquality soil, Social Audit anCorporate SocialResponsbility 42 protection Ensuring environmentalsustainability,ecologicalbalance, and economicallybackwardgroups; citizens andmeasuresforreducinginequalitiesfacedbysocially homes, daycarecentresandsuchotherfacilitiesforsenior homes andhostelsforwomenorphans;settingupoldage Promoting genderequality,empoweringwomen,settingup enhancement projects; children, women, elderly, and the differently abled and livelihood employment enhancingvocationskillsespeciallyamong Promoting education,includingspecialeducationand safe drinkingwater; Government forthepromotionofsanitationandmakingavailable contribution to the Swach Bharat Kosh set-up by the Central care includingpreventivehealthandsanitation Eradicating hunger, poverty and malnutrition, promoting health Schedule VIIunderCompaniesAct2013 (Vii) to asubjectcoveredinScheduleVIIoftheAct. corpus iscreatedexclusivelyforapurposedirectlyrelatable exclusively for undertaking CSR activities; or (b) where the (a) the trust/ society/ section 8 companies etc. is created companies etc.willqualifyasCSRexpenditurelong Contribution to corpus of a trust/ society/ section 8 States whereregistrationoftrustisnotmandatory. to asthe“IncomeTaxAct1956”inCircular)forthose Income TaxAct,1961(whichhasbeeninadvertentlyreferred for of the flora benefit and of fauna, armed animal forces welfare, veterans, agroforestry, war widows No Tax Benefits need toexplainreasonsfornon-complianceinitsreport. to spendthestatedamountonCSRactivities.TheBoardwill The Actdoesnotprescribeanypenalprovisionifacompanyfails Penal Provision any lawforthetimebeinginforce. or anyStateGovernmentothercompetentauthorityunder shall mean any area declared as such by the Central Government Explanation.— Forthepurposesofthisitem,term‘slumarea’ Slum areadevelopment. Rural developmentprojects. Government within academicinstitutionswhichareapprovedbytheCentral

expenditure While expenditure onCSRdoesnotformpartofbusinessexpenditure. 1961. enjoy exemptionsunderdifferentsectionsoftheIncomeTaxAct, extension development projects,skillagricultural to incurred onCSR,spendingseveralactivitieslikecontributions 4 3 2 1 Prime specific Notification Schedule Rules Section no specific projects, Minister’s per se. tax tax exemptions DECEMBER 2016 etc. 540(E)dated23.05.2016 AmendmentRules,2016.Notification numberG.S.R. a Companies(CorporateSocialResponsibility Policy) a Amendmentvianotificationdated6th August,2016 March,2014 a AmendmentviaCorrigendaEffectivefrom 31st Effectivefrom27thFebruary,2014 a ScheduleVII Effectivefrom19thJanuary,2015 AmendmentRules,2015. a Effectivefrom12thSeptember,2014 AmendmentRules,2014 a Companies(CorporateSocialResponsibilityPolicy) Effectivefrom01.04.2014 Rules.2014 a Companies(CorporateSocialResponsibilityPolicy) dated16thMay2016 CompaniesAct,2013GeneralCircularNo.05/2016 SocialResponsibilityundersection135ofthe a ClarificationwithregardtoprovisionsofCorporate No.01/2016 135oftheCompaniesAct,2013GeneralCircular totheCorporateSocialResponsibilityunderSection a FrequentlyAskedQuestions(FAQs)withregard 2014 GeneralCircularNo.21/2014,Dated:18thJune, CompaniesAct,2013. SocialResponsibilityundersection135ofthe aClarifications withregardtoprovisionsofCorporate [Effectivefrom1stApril,2014] a Section135 Particular ofUpdate exemption Legal UpdateinCSR The Relief Companies (CorporateSocialResponsibilityPolicy) which finance Fund, find has have place I been Act, CHARTERED SECRETARY Scientific been 2014 in extended Schedule extended also Research, to clarifies expenditure VII, to already Rural CSR that CS CHARTERED SECRETARY I DECEMBER 2016 43 42 DECEMBER 2016 I CHARTERED SECRETARY Surat [email protected] Practicing Company K Jain&Co. Karuna Jain,ACS [email protected] Practicing CompanySecretaries K Jain&Co. Komal Jain,ACS Prosperity ofPeople andPlanet Priceless ContributionofCorporates towards Corporate SocialResponsibility- Surat CHARTERED SECRETARY

Secretaries I DECEMBER 2016

it cannot be separated from entity. However, for “company” a society is a place within which corporates beyondthelegalcompliances,rulesandregulations.Theconceptofcompany effect on environment and social wellbeing. This is an effort which is undertaken by big Corporate socialresponsibilityisanactionorstrategytotakeaforcompany’s Introduction society responsible. Everybusinessneedssomeplacecalled“society”tooperateandevery a toolbywhichthebenefitstobusinessformeetingthoseobligationscanbeidentified. society; a way of proposing policy ideas on how those obligations can be met; as well as CSR isameansofdiscussingtheextentanyobligationsbusinesshastoitsimmediate businesses and economic systems, and the communities within which they are based. CSR isameansofanalyzingtheinter-dependentrelationshipsthatexistbetween business andsociety. operates legal compliancesintrueletterandspirit. of thecompanyassumessignificantresponsibilitiesforvarious Secretary in employment being the ‘Key Managerial Personnel’ has brought in fresh opportunities for professionals. Company The MandatoryprovisionofCSRunderCompanies Act, 2013 needs and “business” defines the for growth. number Therefore of stakeholders CSR is for a which mutual it benefit is directly bridge or 43 indirectly between

ARTICLE ARTICLE Co practices wereregularlynotpracticed ordoneonlyfornamesake. making contributiontowardscorporate socialresponsibility,CSR Since theCompaniesAct,1956 didnotmandatecompaniesfor towards theupliftmentofsociety andenvironment. make aprofitandrewardshareholdersadequately. company tobalancetheneedsofallstakeholderswithitsneed on theenvironmentwhenmakingdecisions.Thisrequiresthat company takeintofullaccountitsimpactonallstakeholdersand from astrategicperspective.Itrequiresthatresponsible Charity isalegitimateaspect of CSRas long as it is approached the localcommunityandsocietyatlarge”. the qualityoflifeworkforceandtheirfamiliesaswell ethically andcontributetoeconomicdevelopmentwhileimproving CSR as“thecontinuingcommitmentbybusinesstobehave set “Corporate SocialResponsibility” whichmandatescorporatesto of adoptingretaliatoryaction byintroducingtheconceptof caused to citizens and environment, our legislators thought dimension. Lookingafterprogressiveandirreparabledamage of businessonsocietyandenvironmentassumedentirely new and donations. With globalization and industrialization, impact group have been involved in serving community through charity economy was worsening, corporates like Tata, Aditya Birla etc. After independence when socio-economic conditions of Indian caused tolocalcitizensorenvironment. hanged todeathifanynegligence,harm,inconvenience was protection ofenvironmentandsocietylikeaccusedperson was Even before19thcenturyvariouslawswereenactedfor the development agenda. growth andtoengagetheCorporateWorldwithcountry’s the under theCompaniesAct,2013isanattempttosupplement growing divideinoursocieties.TheinclusionoftheCSRmandate unequal asset distribution has led to disparity, inequality and the overall humandevelopment.Butdifferentialregionalgrowthand focusing about underprivileged,underdevelopedandbackwardpeopleby every majorpolicyformulatedbyourgovernmentshowsconcern even though the concept was not formally formulated until recently The historyofCSRisasoldthebusinessitselfand, Origin ofCorporateSocialResponsibility The 44 rpo aside government’s World rate So they arenothavingone. to havetheirwebsite, incase, under theCSRcriteriaarerequired company whicharecovered recommended practice. Hence, the the websiteofcompanyisa Display ofotherinformationon website isstatutoryrequirement. Displaying theCSRpolicyon on some Business cial R fulfillment part esponsibility -Pricel efforts Council of their of of their profits for equitably Sustainable fundamental ess Contribution o to compensate delivering Development rights, the and f Co equality benefits rpo contribute defines rates t and of ow ards Prosperity o Corporation on behalfoftheCommittee.The Committeewill will beapprovedbytheCommittee andmaintainedbythe by itsChairmanoranytwomembers. Minutesofitsmeetings times peryear.Ameetingof theCommitteemaybecalled deems appropriate. Corporation’s managementsuchpowersandauthorityas it may delegate to such subcommittees or to members of the The Committeemayformsub-committeesforanypurpose and is lessthanthree(3)membersasaresultofthevacancy. average Act, 2013 has mandated compulsorily contribution of 2% of legislation forensuringproperCSR.Hence,theCompanies This pavedthewayforanurgentneedtointroduceproper should beindependentdirector. fulfill The Committeeshallmeet as frequentlynecessaryto the the pleasureofBoard.Whereavacancyoccursatanytime in Corporate GovernanceandNominatingCommitteeserve at appointed annuallybytheBoardonrecommendationof the Committee membersandtheChairmanwill be Composition andMeetingsofcommittee Applicability ofCSR contained inthefollowingsections- Provisions RelatingtoCSRasperCompaniesAct,2013are responsibility. financial financial year,theCSRwouldbeapplicable: below mentionedconditionsaretriggeredduringanytimeina and 500 croreor Net Worth membership shall more its OR net years be duties filled profits f Peo by and of 1000 croreof by pl specified Turnover COMPANIES (CSRPOLICY) CSR made DECEMBER 2016 the e a the more RULES, 2014-W.E.F responsibilities, nd Pl W.E.F -01.04.2014 Committee, Board SCHEDULEVII SECTION 135- during 01.04.2014 anet corporates if . the the 5 Croreor Net Profit OR I membership CHARTERED SECRETARY it more three may but towards immediately be not filled and at least one more directors prised ofthreeor Committee” com- cial responsibility “Corporate So- mittee known as constitute acom- companies shall that 135 (1) provides Further section of less corporate if anyofthe provides that in India and office registered having companies foreign including all companies be applicableto Act, 2013shall of Companies Section 135(1) the by than Committee the preceding specified situated Board, social three CHARTERED SECRETARY I DECEMBER 2016 45 44 DECEMBER 2016 I CHARTERED SECRETARY To monitor whether policy formulated has been duly executed be • to expenditure of amount the board the recommend To • • To ensure that the corporate is proactively addressing CSR • To keep members informed of current developments relating • To engage in the expanding dialogue with NGOs, charitable • businesses, Corporation’s the of impact the consider To • To promote a culture that emphasizes and sets high standards • Committee whichareasunder:- Section 135 (3) states functions of Corporate Social responsibility AresponsibilitystatementoftheCSR Committeethatthe 6. Details of CSR spent during the fi nancial year. 5. PrescribedCSRExpenditure(twopercentoftheamountasin 4. Average net profi t of the company for last three fi nancial years 3. TheCompositionoftheCSRCommittee. 2. 1. A brief outline of the company’s CSR policy, including in theBoard’sReport Format for the Annual Report on CSR Activities to be included percentage of profi ts as provided under the section. company. It shall specify the reasons for not spending specifi ed of committee,CSRpolicydevelopedorimplementedbythe company shall specifi cally mention and disclose the composition Section 135 (2) provides that the board of directors report of the report itsactivitiestotheBoard. no. Sr. 2. 1. (1) and implemented. incurred ontheactivities practices issues andismakingCSRapartofitsvision,values management assessmentandbestpractices and governanceissues,disclosurerequirements,risk human rights,environmentalandenergyissues,ethical to all aspects of the practice, including employment law, trusts andotherexternalstakeholders clients, employees,communitiesandregulators perspective, taking into account the interests of shareholders, operations and programs from a social responsibility performance againstthosestandards for corporatesocialresponsibilityandreviews with CSRobjectivesandPolicyofthecompany. implementation and monitoring of CSR Policy, is in compliance fi nancial the during spent amount the which in Manner (c) Amountunspent,ifany; (b) Total amount to be spent for the fi nancial year; (a) item 3above) or programs. and areferencetotheweb-linkCSRpolicyprojects overview ofprojectsorprogramsproposedtobeundertaken Schedule VII by activities whichshallbeundertaken the company as per toboardaboutvarious To formulateandrecommend identifi ed activity project or CSR CHARTERED SECRETARY year isdetailedbelow. (2) covered project is the in which Sector (3) area II. other area I. local programs or Projects (4) I DECEMBER 2016 outlay Amount (5) CoRPoRATE SoCiAl RESPonSiBiliTY - PRiCElESS ConTRiBuTion oF CoRPoRATES TowARDS PRoSPERiTY oF PEoPlE AnD PlAnET. projects spent on actually Amount (6) reasons with the along incurred not Amount (7) or Trust agency Name of (8) Any dividend received from other companies in India, which • Any profi t arising from any overseas branch or branches of • of theAct,butshallnotincludefollowing,namely: statement preparedinaccordancewiththeapplicableprovisions “Net profi t” means the net profi t of a company as per its fi nancial to be made in the profi t for the year. managerial remuneration and requires specifi c addition/deduction with section 198. Section 198 deals with calculation of profi t for this section, the average net profi t will be calculated in accordance An explanationtothesection135(5) states that for thepurposeof for this net profi t purpose. of meaning the specifi cally explain not does of Rs. 5.00 crore or more during any fi nancial year. The section criteria for the CSR applicability is that a company has a net profi t In accordance with section135(1)of the 2013 Act,oneofthe MEANING OFNETPROFIT COMPUTATION OFNETPROFITS:

Net profi tsasper section198 Compensations/damages paid Loss ofcapitalnature Income taxorsuperpaidunderTaxAct,1961 Non permissibledeductions Depreciation andBaddebtswrittenoff Interest onloans,debentures,mortgagesoradvances Usual Workingcharges Tax notifi ed by Central Government Bonus orcommissionpayable Director remuneration Permissible deductions Profi t on sale of fi xed assets/immovable property Profi t/premium on issue of shares Profi t of capital nature Credit nottobeprovidedfor:- Bounties andsubsidiesreceivedformgovernment Credit tobeprovidedfor:- Profi t before tax as per profi t & Loss Account Particulars section 135oftheAct. are coveredunderandcomplyingwiththeprovisionsof otherwise; and the company,whetheroperatedasaseparatecompanyor CSR companies Amount XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX 45

ARTICLE ARTICLE Company • CSR activitiesthroughthefollowingmethods:- India Under 1. Various accountingtreatmentareasfollow:- treatment isgiveninthebooksofaccountscompany. adopts forCSRactivities.Dependinguponthepolicy,accounting Accounting treatmentusuallydifferswithroutewhichthecompany on CSRActivities Accounting Treatmentofexpensesincurred well obligations toincludetheholdingandsubsidiarycompaniesas The CSRRulesappeartowidentheambitforcompliance implement CSRActivities Routes throughwhichcompanycan Co 46 Reporting requirement ofForeign Companies whichever islowerasperAS-2 andservicestobevaluedatcost. Manufactured goods shall be valued at cost or market price account shall be provided when the control of goods is transferred. renders the services as CSR activities, treatment in the books of Where thecompanysupplies the goodsmanufacturedbyitor 3. 2. single financialyear. exceed 5%ofthetotalCSRexpenditurecompanyina years, providedthattheexpenditureforsuchactivitiesdoesnot through institutionswithestablishedtrackrecordsofatleastthree CSR capabilitiesofitspersonnelorimplementationagencies to the local areas within which it operates.A company can build As per section 135 (5) of the act, company shall give preference whether establishedbycentral,stateoranyotherentitynot. with newrulewhichincludescompanyregisteredundersection8 Through • As Collaborating • Through • Through • rpo per Expenses incurredbythecompanyitself- company Expenses inrelationtosupplyofgoodsmanufacturedbythe treated asexpenseandchargedtoprofitlossaccount. Under thissituation,amountspentonCSRactivitieswouldbe society- Expenses incurredbythecompanythroughtrust,NGOsor capital expenditureinthebooksofaccounts. economic when thecompanyhascontrollingpowerandderivesfuture as specifiedunderscheduleVIIofCompaniesAct,2013. companies areableindividuallyreportonsuchprojects. undertaking CSRactivities,providedthateachofthe Companies canalsocollaboratewitheachotherforjointly three yearsundertakingsimilaractivities. that entitywouldneedtohaveanestablishedtrackrecordof established underanactofparliamentorastatelegislature. established byCentre,StateGovernmentorotherentity profit be treatedasrevenueexpenditurewhichisachargeagainst When anexpendituredoesnotgiverisetoassetitwould made inrelationtowhetheritisrevenueorcapitalexpenditure. this initiative. as rate So fulfil recent foreign of the this cial R the its non notification company can benefits specified situation, own companies esponsibility -Pricel company registered or directly non-profit pooling under out dated criteria. the spend and of whose their organizations, first 23.05.2016 section foundation that when The the resources classification ess Contribution o asset, branches CSR company 8, an registered Rule set- amount asset it trust, with would or up 4(2) can other is is project so society on was required generated be as implement f Co trust, the companies. to substituted treated rpo offices provided activities facilitate society rates t to i.e. be as its in ow

ards Prosperity o India specificannualreport,ifany. detail aspertheprescribedformatprovidedinAnnexure1 recommended thatallforeigncompaniesshouldprovideCSR related requirement the foreign company should also disclose the CSR balance sheet under Section 381(1)(b). In addition to the above is In caseofforeigncompaniesunderRule8(2),acompany companies are:- from top10 highlights reports. Some 2014-2015 on based at the ranking to arrive companies at top217 The studylooks 1. required tohavetheirwebsite,incase,theyarenothavingone. the companywhicharecoveredunderCSRcriteria the websiteofcompanyisarecommendedpractice.Hence, website is statutory requirement. Display of other information on of thecompany.Therefore,displayingCSRpolicyon to displaytheCSRpolicyandotherinformationonwebsite As perSection135(4)(a)oftheAct,allcompaniesarerequired on Website Display ofCSRPolicy&Information Facts andfindings (2015) Rank 1 2 3 4 5 6 7 also of variouscompaniesinIndia. reports responsibility reports andbusiness reports, annual quantitative andanalyticalexaminationof the sustainability The study wasconductedwhichanunbiased, relationship n n n n n n n n Fund raising Building valuechain Cost savings Competitive advantage Employee retention Customer loyalty Improver BrandImage welfare facilities Better infrastructureand information required Name ofcompany Tata SteelLimited Limited Tata PowerCompany Ultratech CementLimited Limited Mahindra & Tata MotorsLimited Tata ChemicalsLimited ITC Limited f Peo Benefits ofCSRtoKeyStakeholders to pl DECEMBER 2016 e a in file nd Pl its Employees Companies an anet India annexure . specific (2014) Rank 1 2 3 4 5 6 7 Larg Society at Investors I CHARTERED SECRETARY n n on Name ofcompany Limited Mahindra & Reducing nonfinancialrisk of theirinvestment Maximise thesocialimpact Limited Tata PowerCompany Tata SteelLimited Larsen &ToubroLimited Tata ChemicalsLimited Tata MotorsLimited GAIL (India)Limited website. n n n n n n CSR Education Improver qualityoflife Environment benefits Community well-being Healthcare Emloyment along Further, with It its is CHARTERED SECRETARY I DECEMBER 2016 47 46 DECEMBER 2016 I CHARTERED SECRETARY

5. 4. Many 2. 3.

2 1 No. Sr. 5 4 3 2 1 No. Sr. 8 9 10 profit aftertax:- CSR spent as a percentage of average previous three years top CSR activities than service sector companies. Study reveals Manufacturing sector companies spend more amount on on Private companies spent more amount than pubic companies of Health, wellnessandeducationaretheareaswheremajority spending theamount. yet tobespent.Theirboardreportstatedthereasonsfornot committed CSRAmount;rest31%oftheis survey conducted, companies have spent only 69% of their for CSRActivitiesbutcouldspendonlypartofit.Asperthe private spenders:- has beenspent:- Following isthechartdepictingareaswhereCSRamount Limited Bharat Forge Corporation Burmah Trading Bombay Company Manufacturing Limited Corporation Indian Oil Coal IndiaLimited Fertilizers Limited Chemicals & Rashtriya Corporation Neyveli Lignite Oil IndiaLimited Public Company CHARTERED SECRETARY the CSR Shree CementLimited Corporation Limited Bharat Petroleum Larsen &ToubroLimited five

companies companies manufacturing activities.

had have 3.2% 5.5% spent % ofCSR 2.0% 2.0% 2.1% 2.3% 2.7% spent % ofCSR The set and I DECEMBER 2016 spent aside study service 8 9 10 Co Ltd. Adani Enterprises Limited Tech Mahindra Service company Limited Reliance Industries UPL Limited Bharat ForgeLimited Limited Tech Mahindra Trading Corporation Bombay Burmah Private company 2% their rpo reveals

rate So or part Corporation Limited Bharat Petroleum Infosys Limited Limited Jubilant LifeSciences companies more top cial R of of average five average esponsibility -Pricel in public 2.4% 3.3% spent % ofCSR 2.9% 3.1% 3.2% 3.3% 5.5% spent % ofCSR terms profits. profits and of ess Contribution o of Personnel’ Secretary inemploymentbeingthe‘KeyManagerial Company for professionals. in freshopportunities brought has Act, 2013 Companies of CSRunder provision Mandatory compliance in trueletterandspirit.Beinga compliances various legal resolutions, preparationandsigningofMinutes,etc. of passing i.e. notices,agendas, constituting meetings and conducting respect ofconvening, in full compliance ensure Committee membersandtheirMeetings.Further, he should the CSR through and accorded adhered addressed, properly

7. Conclusion Position ofCompanySecretary have aneffective andlastingsolutiontothesocial woes. about a change in the current social situation in India in order to by thecorporates.Notonebut all corporatesshouldtryandbring 6. 5 4 3 Prescribed CSRbudgetincreasesby13.8%from the company:- Top andbottomstatesofIndiawhereCSRamountisspentby 2015-16. the Limited Ambuja Cements Industries Limited Reliance UPL Limited company officer f Co rpo assumes he rates t 2.8% 2.9% 3.1% should ow ards Prosperity o significant ensure Zone Limited Special Economic Adani Ports& Wipro Limited Limited Ushdev International In March, this year Shri In March,thisyearShri significant ability tomakea phases in India. The has gonethroughmany during 2014-2015.CSR towards CSRactivities of Rs.6337.36crores have disclosed spending many as460companies Arun Jaitelyhassaidas has clearly been proven has clearlybeenproven the overallqualityoflife the societyandimprove that responsibilities

CSR f Peo difference pl 2014-15to issues e a 2.0% 2.1% 2.1% 47 nd Pl anet are for in CS .

ARTICLE ARTICLE * The views expressed here are personal anddon’t [email protected] Mumbai Bennett Coleman&CompanyLimited Vice President&CompanySecretary Kausik Nath*,ACS charity, butaresponsibility Corporate SocialResponsibility isnot 48 reflect thoseofBennett Coleman&Co.Limited. upheaval. Corporates have been the targets of those perturbed by this skewed picture ofunevendistribution of wealthandthebenefitsgrowth.Thisleadstosocial and on the other hand, we have many people living in abysmal poverty. So, we have a myriad contradictions.Onone hand,weareoneofthelargesteconomiesworld, such initiativesinlinewiththe Act.CorporateshaverealizedthatIndiaisacountryof corporates whowerenotinCSR, therearosetheneedtolookatareasfund,pilot but to re-strategize whatever they were doing within the parameters of the Act. For in amorestrategicmanner.Forthesecompanies,itwasnot increasing theirexpenditure, or otherwise with the onset of the Act streamlined whatever spending they were doing Corporates thatweretraditionallyundertakingCSRanyway, asaphilanthropicinitiative corporates inIndiawiththecountry’soveralldevelopmentagenda. supplement itseffortsofequitabilitybydeliveringthe benefits ofgrowththrough driven by corporate legislation. It is an attempt on the part of the government to introduced thisprovision.Inshort,Indiacannowbetakenas thepioneerofCSRbeing contribution bycorporatesisuniquetoIndia.Noother countryintheworldhas why wefailedtodoit.”Thishasbeenwidelyaccepted.As weallknowthattheCSR compulsory. Itis“complyorexplain.”notthey“mustdo it”but“willdoitorexplain The changeinthethoughtprocessisbecauseCSR,though beingaresponsibilityisnot /resources toservethesocietyandbuildacompany’sreputation. no longeraforcedphilanthropyorticktheboxresponsibility.Itisinvestinghardcapital talent to mitigating risk and increasing competitiveness. So, the thinking now is that it is do, butalsogoodforthebusiness-benefitsaremany,fromattractingandretaining time build their reputation as a company which cares. So,it is not only the right thing to future resourcesbysecuringnewemployees,markets,clientsandatthesame and thoughtfully.Corporateshaverealizedifitisa“StrategicCSR”thentheycanbuild spending shouldachieveresults,andthisneedstobedonestrategically,systematically towards communitydevelopmentthroughvariousprojects.Thethoughtprocessis have startedtoviewCSRasstrategicphilanthropylinkedwithresponsibilityandveering research andeducationalinstitutes.Thethinkinghasnowchanged,corporates nothing to do with business. It was more like an institution building exercise like building driven directlyorthroughvariousNGOs.Itwasmoreofaphilanthropicexerciseandhad Before theintroductionofCSRbyAct,activitiescorporateswerevoluntary, private sector,Indianandmultinationalcompanies. large, corporateshaverespondedpositively,withparticipationacrossthepublicand How iscorporateIndiafulfillingtheresponsibilitysogivenbygovernment?Byand policies, includingCSRprojectsorprogramsasrecommendedbythecommittees. earnest. BoardsofalleligiblecompaniesintermstheActhaveapprovedtheirCSR policies, includingtheactivitiestheywishtoundertakeandimplementsameinright broad contourswithinwhicheligiblecompaniesarerequiredtoformulatetheirCSR dated 18th January 2014, issued by the Ministry of Corporate Affairs (MCA) provides the T in Indiatostandupthischallengeandfulfillitsresponsibilities. Companies Act, 2013hasprovidedanopportunitytocorporates Government. The uniqueprovisionsofsection135the reduces disparities. It is a collective responsibility with the Building asocietybyprovidingequalaccesstoopportunities with Schedule VII and the CSR Policy Rules 2014. This along with general circular Responsibility (CSR)byintroducingtheprovisionsofSection135Act,read he CompaniesAct,2013(Act)usheredintherequirementofCorporateSocial DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 49 48 DECEMBER 2016 I CHARTERED SECRETARY

and theareassospent: unspent, the sector wise expenditure for the said financial years Year 14-15andFinancial16,theamountremaining The chartbelowexplainstheCSRexpenditureforFinancial beneficial tothelargergroup/community. need tospendonthetraditionalareasasittendsbe for the benefit of the poor. The answer to this is that there is a sports orwhicharedyingsaybuildingnewtechnologies conservation of national heritage or say development of rural and culture orconservationofanimalswhicharegettingextinct, ask is why only in these areas and say why not in areas like arts through thePrimeMinisterReliefFund.Thequestiononemay schemes like“SkillIndia,”“SwatchBharat.”Somehavespent broad objectivesofthegovernmentinitsvarioussocialimpact Some corporateshaveevenaligned their CSR spends with the areas like road safety, pollution control, slum development. poverty andsoon.Corporatesarealsomovingtospendin development, ruraleliminationofhungerand spending. It is mainly in education, women empowerment, skill Let usnowlookattheareasinwhichcorporatesIndiais being pushedtocontributeintermsofthenewlegislation. their CSRinitiativeswhilesomesmallcompaniesarenow have been quick to understand this and proactively pushed bridge thisgapbetweenhaveandhave-nots.Manycompanies other hand, is watching as to what corporates are doing to development, growthinthecountry.Thecivilsociety,on *Source: www.livemint.com dated3rdAugust,2016 CHARTERED SECRETARY I DECEMBER 2016

the sameasa part of their CSRidentity.For eg- building communicate and projects should thustakeup larger corporates year afteryear, spend a recurring As theActmandates • with othercompanies. while partnering costs arealsoreduced significantly operational together willbeveryhighand willbewellaccepted.The by SMEsgetting impact onacausechosen The collective bySMEsmaybevery less. contribution CSR fund.Individual cluster to resources inaspecificgeographiccreatesizeable (SMEs) canpool their enterprises example, smallandmedium to all.For is beneficial impact onthesocietyatlarge collective effort by leveraging each other’s expertise, to create a with eachother’svisionandpriorities.So,acollaborative align as ateam. In suchpartnerships,thereisanimmediateneedto As theActCSRspends permits, corporatescanchannelize • sector. road safetybyacorporateintheautomobile larger audience.For example, therecentadvertisementon to a by allandcanbecommunicated which canbevisible be such create animpact.Theimpactshould should amount that thequantified to ensure need such, thereisanimmediate to be spent isas large as2%of the profitsof a company.As assessment oftheCSRspends.Mainlybecauseamount There is a needfor growing corporates to carry out animpact • are: conclusion to itslogical responsibility Some of the keyareasoneshouldfocusupontotakethis totheworldat company’s responsiblebehavior large. a after assessing to choose have thepower They also world ornot.Samegoeswithapotentialclientofthecompany. of the co-citizen is aresponsible house a business whether tuned tothefact in thecountryarehighly at large people thatconsumersandthe have alsounderstood Companies Itisaresponsibility. world. business success inthemodern by theAct.Itfor is morethanthat.Itnowavitalcomponent no longerjust a toolmandated public convenientrelationship have understoodthatCSR is As reiteratedabovecompanies HOW TOTAKETHISRESPONSIBILITYFORWARD? Long Term Projects Term Long Partnership Assessment Impact world ornot. is aresponsibleco-citizenofthe to thefactwhetherabusinesshouse large inthecountryarehighlytuned that consumersandthepeopleat Companies havealsounderstood world. Itisaresponsibility. for successinthemodernbusiness that. Itisnowavitalcomponent mandated bythe Act. Itismorethan convenient relationshiptool CSR isnolongerjustapublic Co rpo rate So cial R esponsibility isno t charity , buta respon sibility 49

ARTICLE ARTICLE chain. This not only increases their income, but atthesame their income, chain. Thisnot onlyincreases by incorporating the community intothe company’s supply community livelihood in enhancing CSR initiativeslikeinvesting as representativesof the employer. Thereareotherinnovative to Employees shouldbeencouraged take up suchmandates citizen. as anactofaresponsible can thusbeconstrued and exercise relations public events and into softmarketing turned Bandra festivalinMumbai,etc.Thesecanbe and Celebrate Ghoda festivals, Kala traditional culture. Eventspromoting and name atimportantlocalevents.Eventssuchaspromoting arts in communityeventssothattheseescompany’s to participate should alwayslookforopportunities Companies seen tobeactivelyengagedwiththelocalcommunity. so thatonecanbe the company’simmediatesurroundings There is also aneedtoanimpacton make CSRexpenditure • accounted asCSRexpenditure. be cannot of employees services of thepro-bono monetization a Socially ResponsibleCorporate inallaspects. However, to be italsopromotesCSRasanobligation among employees, in CSRwork of pride So apartfromgeneration aspirations. the Company’s CSR projects, one can channelize such inherent wishto give backto the society. Being associatedwith there isan employees, Further, amongthenewgeneration feel empoweredandmay come out with innovativeideas. projects. This helps ingainingwideracceptance.Employees CSR withthecompany’s employees There isaneedtoengage • to contribute. is constrained if anyone their contribution; partners canincrease corporates tosomeextentcanaddressthisissueasother resources by program soinitiated.Partnershiporpooling a long-term the company.Afluctuatingbudgetcanjeopardize performance of on thefinancial year. Thisagainisdependent from yearto of companies the uncertaintyinCSRbudgets long term Although amajorobstacleindevelopingprojectsis community unrestthatmayhamperbusinessactivities. a largemanufacturingplantisbeingset up. It helps inavoiding where area a tribal say in relationship better community builds these long-term projectsinmakingtheirlivesbetter. It also of thesupport the importance have startedtorealize large helps inbrandrecallto the publicat large. Communitiesbyand projects, it the CSRfundstosuchlong Byaligning of villages. or group schools, largersanitationprojectsfortheentirevillage Co 50 rpo Community Development Community Employees Engaging rate So cial R esponsibility isno t charity , buta respon sibility challenge and fulfillitsresponsibilities. challenge an opportunitytocorporates inIndiatostandupthis provided has with thegovernment. This uniquelegislation responsibility It isacollective disparities. reduces to opportunities access equal a societybyproviding as well.Building opportunity and nowonemaysaythereisan to responsibility, philanthropy from moved strategic. So,wecansayhavegenuinely are increasing;theintentandfocusisnowmore expenditures we may say overall corporateshaverespondedwell.The are manybuttotakeastepbackward; To conclude,challenges also socially. but to grownotonlyeconomically business for responsible will evolveanddevelopovertheyears.It may becomeamodel about CSRspendsbycorporates.It is feltthatCSRinIndia years i.e.(14-15and15-16) we haveseenonlytwofinancial may notbeforthcoming.Tillnow Answers tothesequestions FACE ORMAYBEFACING? WHAT ARETHECHALLENGESCORPORATESMAY How • many. Tolistafew: are forasuccessfulCSRimplementation The challenges made. so being of theCSRexpenditures success measurable is aneedforCorporatestorelyonsuchnewentities There stakeholders. to their and areanswerable professionally success of a project/ program. Theyarealsomanaged tools tomeasureandquantifyensurethe and analytical technological modern monitor, deploy set toimplement, skill The newset of people havethepassionto invest, butalsothe Startup havepeoplewithskillset coming fromIITs / MBA etc. These NGOs/ sectors havesetupoperations. focus onsocial recent yearsmanynewNGOs or one cansayStartupswitha CSR scheme.Inthiscontext,itneedstobepointedoutthatin NGOs toimplementtheir have startedtoidentifyappropriate corporates this many reach. Realizing geographic extensive and over duration scale, longer on alarge CSR initiatives to run if theywish more manpower deploy should Companies • chain foritsfinishedproducts. time for corporate itandsecuresupply becomes anadditional Can • How • Is • Should • Is • How • How • Is • How • generation more embedded to theconceptofCSR? more embedded generation system at the grass root levels to make the future Engage with NGOs with Engage convey theintentandspiritofCSR? financial statements? their annual filedbycompanieswith monitor CSRbythereportsbeing which canbeassessedthrougharatingmechanism. money goestotherightNGO, larger partoftheCorporate say onthearea,itspeople,societyatlargeandsoon. to makeitmorerelevant.?If so bywhom? inareaslikeNorthEast? CSR expenditure there there Ministry the to to to to to a make make improve carry culture a start a Government requirement need of out CSR CSR a DECEMBER 2016 of Corporate mechanism the to an CSR expenditure expenditure ensure reporting assessment body be of an embedded Affairs a be of audit

mechanism I CHARTERED SECRETARY geographical setup more more rating of of the the through the measurable? qualitative? to of right impact monitor CSR NGOs? by spread our corporates institution expenditure of CSR? education the So, of CSR that the to to CS

CHARTERED SECRETARY I DECEMBER 2016 51 50 DECEMBER 2016 I CHARTERED SECRETARY Audit ofCorporate SocialResponsibility [email protected] Company Secretary,Noida Meenu Gupta,ACS CHARTERED SECRETARY I DECEMBER 2016 - ByNiallFitzGerald business.” a nice thing to do or because people are forcing us to do it because it is good for our “Corporate SocialResponsibilityisahard-edgedbusinessdecision.Notbecauseit While evidence-informed approachcanhelpachievetheseobjectives. what works,canbescaledandstillneedstotested- totheirCSRportfolio.An adopt the same approach they use to make important business decisions-understanding ought tobeinwhethertheseinvestmentscanmademore impactful. Companiesshould companies aremeetingtheirminimumspendingrequirements. Anequallyimportantfocus Since the introduction of CSR rules, much of the debate has revolved around whether have hadlittleimpactonlearningoutcomes. that manyoftraditionalinvestmentineducationalinputs(likemoretextbooksorcomputers) the AnnualStatusofEducationReport2014.Yet,severalrigorousevaluationshaveshown cause giventhatnearlyhalfofClass5childrencannotreada2textbook,accordingto of totalCSRspendingin2014-15hasbeendirectedtowardseducation,anunderstandable ineffective, ideas.Forinstance,asubstantialamountofCSRspendinginIndiaaround23% solutions withprovenimpactandallowthemtosteerclearofwell-intentional,butultimately Growing evidencefromimpactevaluationcanguidecompaniestowardsimplementingand understanding competition. This rigorous approach isequally critical toCSR investments. new products,successfulcompaniesconductduediligence:exploringthemarketand CSR decisionsneedtobeasrigorousotherbusinessdecisions.Beforelaunching companies, businessdecisionsarebasedonharddataandreturninvestmentcalculations. By evidence. creating the impact it seeks as many companies do not base their decisions on rigorous It is a game changer for Indian Philanthropy. However, it is less clear if CSR spending is or per Secton135ofCompaniesAct,2013,everycompanyhaving networthofRs.500crore any and data demonstrating howsocialandenvironmentalprogramsarebeing arrivedatandwillfocuson the valueandcredibilityofstatements,asocialauditcanverify theCSRofacompanyby appropriate remediesaccordingly. EffectiveCSRaudithelpstoformulatesoundoperating identifying environment,social or governancerisksfacedbytheorganizationandsuggest be incurred on the activities referred. This requires internal auditor to perform CSR Audit for CSR policy of the company from time to time and recommend the amount of expenditure to T significant assertionsinthereport. instead, tofocusonthedataverification, andevidencegathering, forall audits isnottoplacejudgementontheperformanceofacompanybut similarly toafinancialaudit. Also, like financialaudits, thepurposeofsocial taking theroleofinstrumentssocialaccountabilityforanorganisation social performance against particular standards or expectations, ultimately of individualcompanies. This allowsstakeholders toevaluate acorporation’s Social auditingfacilitatesatransparentcontrolandmonitoringmechanism more definition, financial provides verification a or financial networth, he amount ofRs.6,300crorein2014-15asaspendingonsocialsectorprogrammes. turnover year companies implementation an and assurance audit shall turnover of evidence Rs. constitute provides affected 1,000 that and of gathering financial verification profits crore by mandatory a CSR CSR or under committee for statements rules more all of CSR the financial are significant or net Companies healthy to spending are profit assist statements true assertions and of Board and for Rs. Act, profitable. companies accurate, 500 2013, to provided in frame crore the In has CSR such and thus or by unleashed with more a monitor reports. successful increasing company, 51 specific during the As an

ARTICLE ARTICLE Social Social AuditanditsImportance impact onsociety’sdevelopment. the importanceof social audit under CSR ambit, to evaluate its framework forCSRimplementation.Thearticleseekstohighlight 52 one conductedbyanoutsideconsultant whowillimposeminimal conducted internallybycompany. However,itcanchoosetohave audits andispromotingtheiruptake. Theauditingprocessmaybe bodies has started to recognisethe importance and value of social or evenbyadedicatedgovernment entity.Eachofthesedifferent external and independent consultant, by a NGO representative may gathered The mannerinwhichsocialandenvironmentalinformation is significant assertionsinthereport. justification depending onthecorporationorjurisdiction.Forexample,one The realpurposeofsocialauditisalsointerpreteddifferently gathered withinanorganisation. the collection of data from interviews, documents and inspections and environmentalperformancewithregularmonitoringthrough formally measuringandrecordingthelevelofacompany’ssocial or indirectly,impactstakeholders.Inotherwords,itisameansof performance measuring andreportinganorganisation’ssocialethical of standards orexpectations,ultimatelytakingtheroleofinstruments to evaluate a corporation’s social performance against particular mechanism ofindividualcompanies.Thisallowsstakeholders Social auditingfacilitatesatransparentcontrolandmonitoring data anddisclosingitinasatisfactorymanner. to ensurethatcompaniesarecollectingsocialandenvironmental is seen as a means of assurance, relied upon by governments, and popularityofthewellperformingcompany.Lastly,socialaudit equivalent to its stakeholders so that they may compare such data with performance mayreleasethecollatedsocialdata has committeditselfto.Alternatively,acompanywithhighCSR the extenttowhichitisablemeetvaluesandobjectives about its own social performance, would be to directly determine to to placejudgementontheperformanceofacompanybutinstead, audit. ‘Audit o social focus be Also, Audit f Co collected on accountability and data rpo like the for by may processed rate So scrutinising financial from data a and be corporation cial R other verification, verified broadly for audits, in esponsibility’ companies, an its a social non-financial organisation by defined the to and the audit purpose gather company evidence possibly as varies activities similarly sufficient a of way social significantly. raising itself, gathering, which, of to audits information by a analysing, the financial a directly profile for is hired Data not all oiled little children is no longer adequate proof of CSR activity. of smilingvillagers,mobilehealth vansandclassroomfullofwell- by corporate managed hospitals and technical institutions, pictures Since the CSRregulationisenforced,symbolismrepresented could potentiallythreatentheunbiasednatureofreport. an externalaccountantpaidbythecompanybeingaudited,which social auditsareeitherconductedbycompaniesthemselvesor by outcome ofaudit.However,this is not thenorm and veryoften, independent from management and with no vested interests in the are trend, whichreliesheavilyontheassurancethatsocialaccounts purpose of meeting regulatory requirements. This is a growing success orfailureofaparticularCSRregulationandthusserve In fact, social audits are very important means of assessing the breaching certainsocial,ethicalandenvironmentalstandards. governments monitor companies and hold them accountable when Social Social auditing plays a fundamental role in upholding Corporate cause marketing. company’s publicrelations,socialcauseactivities,and is to take the results seriously and if the general public is to believe credibility toevaluation.Thisisessentialifmanagement Consider biases, the In additiontoallowingcompaniesanalyseanddetermine market share. the bestreputationandthusmaintainingorgaininganincreased other companies.Thisleadscompaniestoaraceofmaintaining achieving thegoalsithassetitselfandhowisperformingagainst social responsibilityreportstoestablishwhetheracorporationis their socialperformanceasstakeholdersandinvestorsrelyonthe stimulates healthy competition between companies to increase of its employees and impact on environment. This, in turn, itself: suchasthesustainabilityofcompany,treatment allocation ofcompanies’resourcesinvestedintheorganisation community, thepublic,aswellotherorganisations,about its in increasinganorganisation’stransparencyandaccountabilityto providing valuable data, social audits also play an important role to allowingcompaniesincreasetheirimageandperformanceby external normsandstandardscompetingcompanies.Inaddition compare their own social performance over time as well as against Furthermore, regularyearlysocialauditsallowcompaniesto commitment tosocialobjectives. with stakeholdersbydemonstratingitssocialperformanceand simply, enhance a company’s reputation, image and relationship in thecaseofaparticulareventleadingtonegativepublicity,or performance, asocialaudithasthepotentialtosafeguarditsimage corporate accounting.Infact,whereacompanyhasgoodsocial reduced operating costs; improved communityrelations, to positive brand awareness; increased employee satisfaction; has shownthatintegratingbusinessstrategyandCSRcontributes deficiencies better self-assessment and establishment of the strengths and information andinsighttoacompany.This,inturn,leads social, environmentalandcommunitygoals,providesvaluable comparing thelevelofsocialperformanceinrelationtopre-set socially responsiblepracticesandimpactonstakeholders, to boththecompanyanditsstakeholders.Reviewing non-financial environmental strategyandprovidingstakeholderswithaccurate stakeholders, audited practicality Responsibility which that present by data, fact may qualified much and as social DECEMBER 2016 within with prove and efficiency like audits a and financial is a a to corporate financial proving objective also be of play more I audit, CHARTERED SECRETARY their direct audit strategy. an social an beneficial important corporate does. outside and auditors Further, indirect They auditor role to social inform which company. in research benefits helping brings and are the CHARTERED SECRETARY I DECEMBER 2016 53 52 DECEMBER 2016 I CHARTERED SECRETARY reputation abovethatofitscompetitors. their desired effectofplacingpressureonthecompanyto try to increase activities, whatevertheirperceivedimpact.Thiscouldhave the of CSRreportswhichensurescompaniesdisclosealltheir solution hasemergedwheregovernmentsregulatethedisclosure companies to behave in a socially responsible manner. A balanced challenging and not necessarilytheonlymethodto compel and themonitoringenforcementofsuchregulationsisclearly The risksofnot payingattentiontoCSRare clear-reputation becoming key. CSR policy,practicesandculture, thenotionofauditingCSRis broad perspective.Inordertoascertain anorganisation’seffective processes andbehavioralimpact onsociety’sstakeholdersfroma managing and taking into consideration organsation’s operational purpose of addressing the scope of a CSR audit, CSR is about beyond ‘right thing’andalsoprotectingthereputationofanorganization social audits.SocialResponsibilityisconcernedwithdong the that money spent in name of CSR is subjected to independent Since CSRbecamemandatory,thereiseveryneedtoensure Audit ofCorporateSocialResponsibility in worsen. Affectedcitizensarequestioningtheextentofworkdone of thecommunitiesaffectedbyanindustryimproveandinnocase Civil societyorganisationsaredemandingthatthelivingconditions of related mattersastheydonotdirectlyprovideanenhancement focusing too much attention to, or neglecting altogether any CSR responsible mannerhasthetendencytoleadcompaniesavoid of mandatoryobligationstoconductbusinessactivitiesinasocially performance, isnotbringingtheanticipatedresults.Infact,alack to increasecorporatesocialreporting,and,moreimportantly, Countries havebeguntorealise,thatsolelyrelyingonmarketforces direct stakeholderaction,whichhastakenplaceacrosstheworld. linked to the constant increase of legislation and regulation and a commitment ofcompanies,but,moreimportantly,ithasbeen reporting. Thisrisehasbeenattributedpartlytothevoluntary Recent years have seen a rise in the general uptake of CSR to beputinplaceoverseethefulfillmentofrules. never discussed. A system of social audits would necessarily have something whichuntilnowwasonlyreportedtoshareholders–but are demandingasocialauditoftheprocessesandoutcomes did they have to say about the impact of the CSR efforts? They the profit. CSR company, thetreatmentofits employees andimpactonenvironment. resources investedintheorganisationitself: suchasthesustainabilityof the public, aswellotherorganisations, abouttheallocationofcompanies’ to itsstakeholders, muchlike afinancialauditdoes. They informthecommunity, important roleinincreasinganorganisation’s transparencyandaccountability image andperformancebyprovidingvaluable data, socialauditsalsoplayan competing companies. Inadditiontoallowingcompaniesincreasetheir performance overtimeaswellagainstexternalnormsandstandards Regular yearlysocialauditsallowcompaniestocomparetheirown CHARTERED SECRETARY name short-term However, performance of CSR. considerations the How to imposition attract were I DECEMBER 2016 the investors of of beneficiaries profit regulations and maximization. raise relating selected? its profile to For What CSR and the iii. ii. i. considerations including: component programs addressing both internal and external An organization’ssocialresponsibilityinitiativemayincludemany Management • Reliabilityofmeasuresperformance • Adequacyofinternalcontrolandreviewmechanisms • investors On onehand,managementisresponsibletoshareholdersand Management must reconcile sometimes these contrary needs. creating The challenge of developing a socially responsible organization is responsibility issues that affect their organization and industry. The auditor should develop a general understanding of social reputational andbusinessprobitynottomentionCSRgovernance. an auditthattakesintoconsiderationhealth,safety,environment, actions. This called for a different approach to audit and in part focus on these risks and assist management to identify appropriate damage, lawsuits and government scrutiny. Internal audit should Effectiveness • • A CSRauditprogramcovers: control overitsresourcesandemployees. responsible to thesociety that invests the modern corporation with social issues. relations andtheadequacyof the PRfunctioninaddressing actions andtherelatedimpactto thecommunity.Assesspublic to employeesandthepublic to describetheorganizations – Establisheffectiveplanstocommunicate Communications success. independent review of project performance are critical to objectives, adequateresourcing,effectivemonitoringand and resources,bothmonetarypeople.Settingofclear long or business impact. These projects may typically run over a large CSR projects that are aimed at delivering high Brand –Companiesoftenembarkon Implementation Project volunteer inthecommunityonpaidtime. should be considered. Some companies allow personnel to involvement thetiming,amountoffunds,andtypegifts judgment. Althoughthisisaverycommontypeofcommunity that donationsare carefully reviewedand based upon sound – Managementshouldensure Resources & Funds Donating attention, etc regulatory compliance,managementofpotentialadverseNGO implementation Effectiveness of the operating frameworkfor CSR the time to deliver balance horizon of of a implementation between risks financial and associated involve ‘Audit o profitability return. f Co significant of Conversely, specific, rpo with and rate So external other investment large cial R management public CSR esponsibility’ factors 53 projects of goods. time like is

ARTICLE ARTICLE standards againstwhichaCSR Auditcantakeplacesuchas: management. The CSRauditisatoolfor decision makingandforstrategic commitment fromthebusiness at alllevels. the businessisintegratedwith CSRinitiativesandthereishigh stakeholders. This is a highly sustainable model as the success of the business objectives, creating a ‘virtuous circle’ for all the At thehighestlevel,CSRstrategyiscloselyintegrated with iii. ii. i. CSR activitiescoveravarietyofadditionalissuesincluding: periodic reviewoftheiraccountingandoversightprocesses. are alsosubjecttointernalcontrolsandshouldbeconsideredfor sponsorship ofcharityevents,andgiftstothearts.Suchinitiatives include scholarshipsforstudents,adoptionofparksorhighways, contributions aspartofgoodcorporatecitizenship.Examples some levelofcommunityawareness,publicservice,orcharitable adopted bytheorganization.Atbasiclevel,organizationshave CSR programscanoperateatdifferentlevelsaccordingtothepolicy vii. vi. v. iv. 54 ‘Audit o poor countrylabororagriculturalmarkets. disparities or exploit people. Examples include exploitation of for healthyeconomicgrowththatdonotexacerbatewealth and theirmarketplacecommunitiesshouldhaveopportunities fire significantly –Themegacorporationsthat Development Market Free and pollution. strip mining, protection of endangered species, deforestation natural habitats,wildlife,andlandsurfaces.Examplesinclude – Depletion of Resources or Habitat Natural of Destruction on childlabor. workers with reasonable work conditions, including restrictions social rightsofworkers.Examples include fairwagesforfactory Protection of Human Rights – Denialorpreventionoflegal effective, andincorporatecommoninterests. related legislationandregulatorymandatesaresound, rather than part of the problem. Companies can also ensure responsibilities can help ensure they arepartof the solution better understand the problems at issue and the governments often alongwiththeirindustrycompetitors.Organizationsthat with government agencies to provide research on issues Government Program Participation – Companies collaborate products toensureproperdisposalorreuse. support recyclingprogramsforprinterinkcartridgesandother byproducts. Forexample,manufacturingcompaniescan or productsthatreduceremoveundesirableimpacts –Organizationscanconduct research intoalternativemethodsorapproachestooperations Development & Research component. any partofthecommunityshouldincludeasocialresponsibility plants that directly impact the community. For example, operations or incorporate social responsibility considerations especially those made transparenttothepublic.Managementdecisionsshould procedures, statementstothepublic,marketingcampaigns,and plans. Theseintentionsmaybeincludedinpolicyand levels and objectives should incorporate social responsibility – Allorganizational Support Decision & Policies Managerial address appropriateissues. or theenvironmentwillhelporganizationunderstandand groups andworkingwiththoseresponsibleforpublicwelfare responsibility issues.Establishingliaisonswithcommunity dedicated resources to identify, evaluate, and research social – Organizations can allocate Analysis Responsibility Social f Co regarding that rpo rate So Just create impact fair like cial R noise, trade developing a esponsibility’ financial traffic, policies. or audit, market pollution, Less there economies developed or are that various impinge are countries under CSR on substantial improvement inglobalCSR. social auditinglegislationtohave thedesiredeffectofensuringa CSR legislation, it is required to consider the implementation of high levelofimpartiality by auditor. With the implementation of which helptoensureasatisfactory collationofdataaswella stakeholders social auditingsystemwhichcan betrustedandrelieduponby of quality of CSR reports. The most effective way of achieving a CSR reportingpracticesbynotbeingabletoguaranteethelevel n n n n n n benefits lack ofareliablemeaningfulsystemisthreateningthepotential environmental auditingpracticesarestillintheirinfancystage. The Even afterdecadesofdevelopment,currentsocial and Conclusion in evolution considerations intheirdecisionmakingprocessetc.Ahigher but doingitinamoreresponsiblemanneri.e.embeddingsocietal organizations whereby organizations started to do what they do This evolved into a more integrated approach of CSR in at large. society andhowtheyaffectorcanbeaffectedby activities independentoftheirbusinessoperations,impacton certain CSR related activities whereby they undertake responsible the increasedhypeofCSR,organizationsstartedtoundertake Traditionally organization’sprimefocusistodobusiness.With organization: and howaCSRauditcanfacilitatebetterunderstandingofan However, following are organizations different approaches to CSR of CSRandenableorganization’stobeauditedagainstthem. These standardsalthoughvaryinstyleanddepthcoverthebasics vi. v. iv. iii. ii. i. Following areCSRissuesthataAuditshouldcover: objectives, creatinga‘virtuouscircle’forallthestakeholders. manner butafurtherstepofintegratingCSRwiththeorganization’s things tosociety,oroperatingone’sorganizationinaresponsible today “sustainability”. It is no longer simply a matter of doing good a decision makingprocess; Approach toCSRrelatedissueswithrespectitsinternal CSR practices,policiesandculture; CSR goalsandobjectives; Good BusinessFramework Global ReportingInitiative Global Compact interest causes. contribution to social and economic development, General Community Involvement:Impactsonlocalcommunities, their useanddisposal. into the manufacturing and distribution of products, and into Environment: Incorporationofenvironmentalconsiderations controls, Treatmentofshareholders,Executiveremuneration. Corporate Governance:BoardofDirectors,Auditandinternal system. and safety, career development and training, Remuneration Human Resources:Laborrelations,Workingconditions,health practices. contractors, Preventionofcorruptionandanti-competitive Business Behavior:Relationswithclients,suppliersandsub- Forced labor,Childlabor. association andCollectivebargaining,Nondiscrimination, Human Rights: Fundamental Human Rights, Freedom of responsible gained finally is to manner from led implement DECEMBER 2016 organizations the a current closer specific definition I CHARTERED SECRETARY increased to regulation doing to responsible trend what and we of guidelines adopting now things call CS CHARTERED SECRETARY I DECEMBER 2016 55 54 DECEMBER 2016 I CHARTERED SECRETARY Secretaries ofIndia–New Delhi. for theexclusiveuseofTheInstitute Company work through this write-up. This article has been written it. The author, in any way, does not intend to solicit author shallnotbeliableforanyactiontaken basedon does notconstitutealegaladviseoropinion. The exercise andtheinformationcontainedin thearticle * Thisarticleispurelyaresearchand academic [email protected] Advocate, Vadodara Parmar*, ACS Bharatsinh Chandrasinh Social ResponsibilityinIndia Statutory Enforcement ofCorporate Efficacy ofSocial Audit inContemporary CHARTERED SECRETARY

I DECEMBER 2016 1 journal-of-scientific-research-IJSR)file.phpval=October_2012_1349177858_07f3d_06.pdf (LastvisitedonOctober26, 2016) of CSRprojectsinthepostStatutoryeraIndia. concept welfare ofsocietyandstakeholders.Onthisbackdrop,articleaimstounderstandthe social, environmental and economic concerns in its values and operations to improve the which harm the community and environment. CSR is a strategy of a company to integrate from theirbusinessactivities.Companiesencouragesocietalgrowthandeliminatepractices society aswellenvironmentbytakingresponsibilityforthenegativeimpactsemanating with Corporate Social Responsibility (CSR) represents an ideology whereby companies along benefit accruingtothesociety. being ofcitizens,determinesthesocialcostandmeasures activities onthesocialwell they weredirected.Itprovidescriticalinputstocorrectlyassesstheimpactofgovernment whether reporting over. Social Audit is a term used to describe the process of examining, measuring and Social Audit is also linked with the concept of CSR followed by corporate entities the world auditors. places andlistentocitizens’opinionsregardingvariousmatters, whoweredesignatedas ancient emperors, to get feedback on their activities, engaged some persons to go to public The term‘Audit’issaidtohavederivedfromtheLatin“Audire” means ‘tohear’.Beliefisthat Social Audit-Meaning&Definition Social Introduction Social designed, thusitprovestobeaninstrumentofsocialaccountability ofanorganization. Grameen • utility vis-à-visitssocialrelevance. whether National • Swapan KumarRoy,“SocialAuditinIndia:AnOverview” 1IJSR16(2012)availableat-httpwww.worldwidejournals.cominternational- CSR projectsinthepostStatutoryeraIndia. and alsotochecktheusefulnessefficiencyofSocial Audit of This article aims to understand the concept of Social Audit and CSR democratic settingsshapethebaseforoperationalizingsocialaudit. and officials. Essentiallysocio-cultural, administrative, legaland accountability ofdecision-makers, representatives, managers transparency and communication of information resulting in greater Social auditprocessisaninstrumentforsocialengagement, reporting andultimatelyimproving anorganization’ssocialandethicalperformance”. assembly whereallthedetails of theprojectarescrutinized”. carrying audit Audit of the the on Social may is benefits Institute the benefits out Bharat, an social be Audit instrument their defined of of of a and and Rural the economic the bulletin ethical relevant CSR as projects/activities of Development an social and of in-depth obligation performance Ministry projects also accountability to scrutiny defines and of check for reach Rural of profitability activities an it and the of as the organization. Development an usefulness, “a analysis organization, people way reach also of of measuring, the for consider the efficiency It’s defines beneficiaries whom working a a process process the the understanding, it of of as Social interests same any to to for 55 “a find find whom public public Audit were out out 1

ARTICLE ARTICLE corporations startedpublishingtheirresultsannually. first Audit’. In Brazil, the idea began in the 1970s and by 1980s the information ofasocialnatureledtowhatisknownas‘Social and objectives.ThepublicationofAnnualReportscontaining companies began to provide accounts for their social actions 3 2 methodology in thecasesofpublicworks by thegovernmentapplying In India,theconceptofsocialauditisbyandlargetargeted Social AuditinIndia to society aswellobtainingpublicfeedbackontheiractivities corporates asaninstrumentforreportingtheircontributionto all concerned. Theconceptat that moment developed among used asfarpossiblewiththeconsentandunderstandingof should accountfortheuseoftheirpowers,whichbe starts withtheprinciplethatinademocracydecisionmakers professional accountability.AccordingtoMedawar,SocialAudit safety issues and on matters of corporate, governmental and 1972 withtheapplicationofideainmedicinepolicy,drug developed itinUSA1950s.CharlesMedawarpioneered to acknowledgeresponsibilitytowardscitizens.HowardR.Bowen Theodore J-regardedasitsfoundingfather-calledoncompanies Social Audit was in its nascent stages in 1940s when Kreps Historical Background 56 conflict. and sharesofsomecompaniesthatwereassociatedwiththe the war in Vietnam triggered a movement to boycott the goods United StatesandEuropeduringthe60s,publicrepudiationof IRJSS-2013-157.pdf ( LastvisitedonSeptember04,2016). available at9.ISCA-IRJSS-2013-157httpwww.isca.inIJSSArchivev2i119.ISCA- India relatingtoPanchayatRajinstitutions. significance Limited (TISCO)Jamshedpurintheyear1979.Itgained In India,theinitiativewastakenbyTataIronandSteelCompany industry trendsoractionsoftradeunions. concerned withtheeconomicfunctionofgovernmentpolicies, that theseevaluationshadasocialangletothemandwere not on jobs,communityandtheenvironment,inorderto emphasize used todescribeevaluationsthatfocused on thelikelyimpact In the United Kingdom and Europe in the mid 1970s, it was Efficacy o Sushmita Gahlot,“SocialAuditsinIndia” 2(11) IRJSS41(2013)ISSN2319–3565 Ibid. ct2012o2277-8179 supplement social Society f So audits cial Audit inContempo after of their involving demanded were the market 73rd published. public Amendment and a new rary Statut financial through However, ethical of o ry Enfo performance. 3 physical

the attitude since Constitution rcement o the verification and 2

1990s, In some f Co the rpo of rate So The • Mahatma • RighttoInformationAct2005: • The • supports availabletoSocialAuditinIndia,like: lesser practicedphenomenon.Therearesomelegislative Corporates regarding their CSR project is comparatively a mobilization etc.ProductionofSocialAuditReportbyIndian of works,recordsassessment,publichearingandmass addition phenomenon isthatwhenthe corporations getbiggerinsize, the community,environment.Thefundamentalbelieffor this encourage societalgrowthandeliminatepracticesthatharm for thenegativeimpactsofbusinessactivities.Companies of societyaswellenvironmentbytakingresponsibility 5 4 economic CSR is an ideology whereby companies along with shouldering Corporate SocialResponsibility principles. among differentsocialgroupsreachedthroughgoodgovernance in performance ofaprogrammevis-a-visitsstatedcorevalues Social Auditcoversawiderspectrumsinceitexaminesthe Social Audit&Otherudits rights, community,societyandstatutorycompliances. its reportsrevolvearoundethics,labour,environment,human stated objectives.Itcoversawidehorizonofstakeholders and organisation shapesthesocialauditprocessaccordingto its is that it is an internally generated process whereby the The maindifferencebetweensocialauditandotheraudits experience, reappraisingstandards. analyzing deviation, taking corrective actions and based on this measuring performanceagainststandards,examiningand Operations audit involves establishing standards of operation, affairs inaccordancewiththefinancialreportingframework. respects, and the same give a true and fair view of its state of in nature. These are expectations of the society from these are that Financial auditisconductedtoprovidereasonableassurance stakeholder’s views. objectives throughsystematicandregularmonitoringbasedon Supra 3atp.43. Supra 2atp.18. the cial R in thescheme. trained agencies, to ensure transparency and accountability Social Auditasperthepre-designedschedulethrough The StateGovernmentismaderesponsibleforconducting Act (MGNREGA),2005: resources tomakearequestforinformationformally. categories of information so that the citizens need minimum for widedisseminationandtoproactivelypublishcertain Act requireseverypublicauthoritytocomputerizerecords It isakindofsupportforSocialAuditsysteminIndia.The addition tootherfunctions. empowered the Gram-Sabhas to conduct Social Audits in object ofdecentralizationinthecountry. of the Panchayat Raj institutions as well as achieving the 2002) emphasizedsocialauditfortheeffective functioning several the light financial esponsibility inI to approach 73rd obligation their of It other provides community Gandhi amendment economic statements DECEMBER 2016 paper responsibilities for National ndia an profitability values to responsibility impact the of are Rural the and presented Ninth I assessment CHARTERED SECRETARY of also the Constitution non-financial Employment Five of distribution consider earning 4 fairly

Year of in non-financial profits, the Plan of all and Guarantee of 5

interests India: material benefits (1997- social there It CHARTERED SECRETARY I DECEMBER 2016 57 56 DECEMBER 2016 I CHARTERED SECRETARY Approve • The Boardshall- • qualify forCSR. Rural development.Amountspentonthesecategories will Welfare ofSC-ST-Minority-Women/Technologyincubators/ war widows/Sports/contributiontoPMNationalRelieffund, 8 7 p. 199 6 The Responsibility Policy)ules,2014 The Companies(CorporateSocial heritage-arts-culture/those Sustainability andecologicalbalance/ProtectionofNational Education /Addressing gender discrimination/Environmental to-Eradication of Poverty-hunger, Sanitation-healthcare/ It prescribesbroadcategoriesofCSRactivitiesrelating Schedule VIIoftheAct Net • Turnover-Rs.1000crores/more-or • Networth-Rs.500crores/more-or • having: every company CSR activities.Accordingly, VII describes Schedule and for CSR of theActmakesprovisions 135 Section Act, 2013(the‘A’) Statutory aspectsofCSR–theCompanies defines The WorldBusinessCouncilforSustainableDevelopment Definition explicit andimplicithelptheseentitiesstandwheretheyare. corporates to give something in return to the society with whose 9 inMinistrypdfFAQ_CSR.pdf (lastvisitedonMarch23,2016) CSR, dtd. 12/01/2016, FAQ , atFAQ_CSRhttp://www.mca.gov. available 2013) families aswellofthecommunityandsocietyatlarge.” while improvingthequalityoflifeworkforceandtheir commitment bybusinesstocontributeeconomicdevelopment ICSI-Professional Programme-ModuleIV-‘Governance, BusinessEthics&Sustainability’ Ibid. Ministry ofAffairs’General CircularNo.01/2016,05/19/2015- Corporate (last visited onDecember11, at http// available www.icsi.inStudy%20Material incurred onCSRactivitiesandmonitorthepolicy. in ScheduleVII,recommendamountofexpendituretobe Report andplaceonthecompany’swebsite immediately i.e. Ensure that CSR-activities are undertaken and CSR amount- of theAct(i.e.PROFITBEFORETAXATION(PBT). shall be calculated in accordance with the provisions of 198 and amount, thecompanyshallgivepreferencetolocalareas reasons fornotspendingtheamount.ForCSR spend suchamount,theBoardshallinitsreportspecify CSR formulate/recommend totheboardaCSRPolicyindicating shall disclosethecomposition.TheCSRCommittee consisting of three or more directors and the Board’s report preceding Central CHARTERED SECRETARY at CSR areas profit-Rs. activities least as the 8 Government

financial around 2% “Corporate preceding CSR to of 5 be average crores/more policy it undertaken years” where Social beneficial financial I has DECEMBER 2016 and shall net it notified Responsibility disclose profits operates. by constitute during years- Efficacy o to the Armed made company these is contents “any Average a f So spent. forces, CSR during is Rules cial Audit inContemporary Statut the of as Committee If in continuing the veterans, net specified the it 9 Board’s

& fails 7 three three profit also 6 to in Board’sReport. Format fortheAnnualReportonCSRactivitiestobeincluded social capital. people aboutservicesprovidedandultimatelycontributesto social relevanceofprogrammes,improvessatisfaction Audit generatesroomforcivilsociety’scontributions,ensures institutionalizing socialauditwithbestpracticedmodel.Social of thescheme.AndhraPradeshhasbeensuccessfulin accountability from thoseinvolvedintheimplementation of social audit has been made mandatory, further ensuring Employment Guarantee Act (MGNREGA) 2005, conduct the Government of India’s Mahatma Gandhi National Rural 11 10 -RVNL- NewDelhi,andconductedbyNationalCorporateSocial Projects forFY2014-15,CommissionedbyRailVikasNigam Ltd. For eg. the Mid Term Social Audit Report of CSR & Sustainability Illustrative CaseStudy between whatpeoplewantanddotheyget. The rationalefor the thrust for social audit is the vast divide Statutory CSRregimeinIndia Need andefficacyofSocialAuditin Audit%20Toolkit%20Final.pdf(last visitedonOctober26,2016) at SocialAuditToolkitFinal-httpwww.cgg.gov.inpublicationdownloads2aSocial%20 Toolkit”, CentreforGoodGovernance,Government ofAndhraPradesh,p.25available IRJSS-2013-157.pdf (LastvisitedonSeptember 04,2016) available at9.ISCA-IRJSS-2013-157httpwww.isca.inIJSSArchivev2i119.ISCA- during that companies covered under Section 135 of the Act, to ensure The CompaniesAct,2013makesitmandatoryforthe deprived people,socialauditmaybecomeimperative. local society at large. For CSR, many Indian companies engage with Act, therebyextendingtheboundariesofcompaniesinto the spent onCSRactivitiesprescribedunderScheduleVIIofthe of ascertain howthese CSR activitiesbring changes in thelives CSR activities are generally from the local population. So to P. KMohantyDr.,V.K.Parigi,KurianThomas and VivekMisra,“SocialAudit:A SushmitaGahlot,“SocialAuditsinIndia” 2(11)IRJSS42(2013)ISSN2319–3565 community CSR programmes /policies. it canreshapeitsCSRactivities valuable feedbackbasedonwhich capital. The companyinturngets and thuscontributestosocial people aboutservicesprovided improves thesatisfactionof relevance ofprogrammes, contribution, ensuressocial creates aspaceforcivilsociety’s Social Audit ofCSRprojects communities the amount o three ry Enfo 11 at

large -i.e. in rcement o immediately surrounding at and least f Co specifically rpo 2% preceding areas, rate So of average the cial R so disadvantaged financial the esponsibility inI net beneficiaries profits years- 10 57 Under made and ndia of is

ARTICLE ARTICLE (iii) 12 EnhancementofOrganisationalReputation: • several respectsasstatedbelow: Conducting SocialAuditofaCSRprojectisadvantageous in Advantages (ii) (i) RVNL’S CSRProjects- its CSRactivitiesinatimeboundmanner.” sustainable basis,initsvicinity.RVNLiscommittedtoexecute the qualityoflifecommunitiesandstakeholdersona meet itssocialobligationsbyplayinganactiveroletoimprove revealed that- “at RVNL, CSR is envisaged as a commitment to (by a research team led by Prof. B. Venkatesh Kumar- Director) Responsibility Hub,TataInstituteofSocialSciences,Mumbai 58 programmes /policies. feedback basedonwhichitcanreshapeitsCSRactivities contributes tosocialcapital. The companyinturngetsvaluable satisfaction ofpeopleaboutservicesprovidedandthus ensures social relevance of programmes, improves the of CSRprojectscreatesaspaceforcivilsociety’scontribution, Thus, ascanbeseenfromtheaboveRVNL-case,SocialAudit Social_audit_report_kolkata__2014-15.pdf(last visitedonSeptember 04,2016) kolkata__2014- 15httpwww.rvnl.orgadminuploaded1leftdocument20150501133527_ Sciences, Mumbai,pp.13-49availableat20150501133527_Social_audit_report_ conducted byNationalCorporateSocialResponsibility Hub,TataInstituteofSocial Projects forFY2014-15”,Commissionedby RailVikasNigamLtd-RVNL-NewDelhi, Efficacy o B. VenkateshKumarProf.“MidTermSocial AuditReportofCSR&Sustainability immensely of their children.Needy people from thevillageshave and continuetheprojectinyear2015-16. the opinion that RVNL should identify more such households impact anddemandofthestakeholders,auditteamis used tostudyunderkeresonelamps.Inviewofpositive is noelectricity.Agreatboontoschoolgoingchildrenwho blocks of24ParaganadistrictWestBengalwherethere families livingaroundthevillagesofJalangiandBhangar Approximately 350solarlightshavebeenprovidedtothe Math, Naora. districts ofWestBengalbeingimplementedbyRamakrishna Providing Solarhomelightingsysteminsomebackward them. resulting participation, socialawarenessandlocaldemocracy tune withpeople’sexpectations.Itpromotescommunity is helpfultotheorganisationinreshapingitspriorities performance and stakeholders’ perception which in turn It providesinformationaboutorganisation’sethical parents From thefeedback obtained from parents,it is seenthat Bengal byRamakrishnaMath. support to the downtrodden villages in the Naora –West Educational Supporttounderprivilegedchildrenandhealth the project. positive impacts in the weaker section of the society from RVNL tocontinuethesupportIHBPforlongrunget moving towards self dependent stage. It was advised to very happywiththeperformanceoftheirchildrenwhowere praised & asked for further support of RVNL as they were section of thesociety.Duringinteractionparents abled childrenofunderprivilegedbackwardandweaker Kolkata providesqualityeducationandtrainingtodifferently Institute fortheHandicappedandBackwardPeople(IHBP) f So are cial Audit inContempo in benefited extremely to company’s satisfied from fulfilment the rary Statut with health the of o ry Enfo social support overall 12 rcement o responsibility,

development provided f Co rpo to rate So base foroperationalisingsocialaudit. cultural, administrative,legalanddemocraticsettingsshape the and of a given CSR project and the improvements required if any Multidirectional: • Participatory: • Comprehensive: • Multi-Perspective/Polyvocal: • principles havebeenrecognized,i.e.socialauditis- social objectivesthroughauditingpractices,thefollowing To achieve continuously improving performance relating to Principles ofSocialAudit 14 13 Difficulty has It is conducted to check how well the concerned organization Purpose ofSocialAudit representatives, resulting ingreateraccountabilityofdecision-makers, engagement, transparencyandcommunicationofinformation Thus, social audit process is an instrument for social Disclosed: • Verified: • Comparative: • Regular: • development programmescarried outbythecompany. It Increasedconfidence: • OrganisationalChange: •

Id. atpp.19-20. Supra 11atpp.22-23. cial R similar fashion. in work andreporting similar doing with organizations for comparisons but alsoprovides norms orbenchmarks external each yearandagainstappropriate performance to compareitsown the organization Since itnotonlyenables Since stakeholdersshareandgivefeedbackonseveralaspects. stakeholders. It encourages participation and sharing of values by work andperformance. Since it covers reporting of all aspects of organisation’s stakeholders oforganisation. Since it revealsviewsand voices of thetotality accountability andtransparency. and thecommunityatlarge,thisdemonstrates Since theauditedaccountsaredisclosedtostakeholders in theconcernedorganisation. experienced personoragencyhavingnovestedinterests Because social accounts are audited by some reasonably activities. ingrained intheorganizationalculturecoveringall on aregularbasis,theconceptandpracticebecome Since itenablestheorganisationtoproducesocialaccounts areas neglectedsofarorhavingbeengivenlowpriority. accountability organisational changes. progress onthesame,leadingtowardspositive It pinpoints certain improvement goals and emphasizes performance oftheconcernedcompanyalsoincreases. performed thereby helps esponsibility inI organisation to increase in meeting managers and DECEMBER 2016 ndia the thereby to the act efficacy/ needs and with the I CHARTERED SECRETARY officials. greater of effectiveness 14 reputation the

targeted confidence Essentially and of beneficiaries concerned financial in socio- social 13

CHARTERED SECRETARY I DECEMBER 2016 59 58 DECEMBER 2016 I CHARTERED SECRETARY the programme pertainingtoagivenCSRprojectshallinclude 5 4 3 17 16 15 environmental gauge the performance of the company in terms of its social, for conductingsocialauditisnottodiscovermistakesbut to ultimate with theconceptofCSR,bothfocusingonwelfare the Thus, the concept of SocialAuditbyimplication goes parallel Conclusion Defining 2 1 include thefollowingsteps: The SocialAuditProgrammeforagivenCSRProjectmay Steps forocialAuditProgramme Government • Being aflexibletoolcanbeusedbymanyuserslikethe- Users ofSocialAudit Several inclusiveness andconsensus. may subscribe to good governance principles of participation, Such asocialauditprogramme of company’s CSR activities 6 NGOs/Civil • : 5|Oct al=October_2012_1349177858_07f3d_06.pdf (LastvisitedonOctober26,2016) -httpwww.worldwidejournals.cominternational-journal-of-scientific-research-IJSR)file.phpv introduction ofsocialauditsystem. Private • audit exist, lackoflegalactionincasenoncompliancesocial rights, suitable social accounting reporting system does not lack of education peopletend to remainindifferent about their Id. atpp.46-49. Supra 14atpp.32-33. Swapan KumarRoy,“SocialAuditinIndia: AnOverview”1IJSR17(2012)availableat social Social Audit Dissemination- Presenting social accounts to prepared withkeyissuesforactionandthefuturetargets. collection, viewsofstakeholders,socialaccountstobe Preparing andUsingSocialAccounts-Basedondata and preparationofsocialaccountingplantimeline. selection ofperformanceindicatorsforsocialaccounting the useof existing data, additional data to be collected, Social AccountingandBook-keeping-Decidingabout purpose, keyissuesandstakeholdersforconsultation. CSR projects. programme andeffectiveadvocacyanalysisaboutthe social auditetc. budgets andallotmentofresponsibilityforconductingthe concerned CSRprogramme,itsobjectives,deliverysystem, Preparatory Activities-Collectingprimaryinformationofthe social auditprocess. their participation ultimately resulting in institutionalization of ends, followupactions,reviewingstakeholders’reportsfor to Feedback and Institutionalization of Social Audit- Feedback then todisseminatethesocialauditor’sconsolidatedreport. viability withimpactonthecommunityandenvironment, of agivenproject, implementing CSRprogrammes,forperformanceappraisal views CHARTERED SECRETARY principles fine-tune difficulties beneficiaries auditors of Corporate Audit stakeholders/beneficiaries and Society the etc. 16 Departments, boundaries

arise for community CSR prove of their Enterprises, etc. a in policies-programmes given conduct I verification, as DECEMBER 2016 to 17 and a goals.

be project. Funding tool 15 hindrances Stakeholders- for

of Efficacy o to The Social balancing on force recommendations The Agencies efficient the basic f So Audit, their service in towards cial Audit inContemporary Statut the Determining the intervention assumption social like or financial delivery efficient due social those audit and to efficient instrument. programmes objectively,socialauditmayprovetobean reasons. Tomapsuchgapsand execute companies’ CSR concerned projects,duetovariouscontrollable/uncontrollable of amountforCSRandutilisationthesameinexecution for emergenceofgapresultingfromthestatutoryallocation and mandatory requirement in India, there may be possibility appropriation ofprescribedamountforCSRisnowastatutory mechanism of the company and the concerned project. Since the References 7. 6. 5. 4. 3. 2. 1. http://www.wbcsd.org/work-program/business-role/ September 04, 2016) Social_audit_report_kolkata__2014-15.pdf(last visitedon orgadminuploaded1leftdocument20150501133527_ Social_audit_report_kolkata__2014- 15httpwww.rvnl. Mumbai, pp.13-49available at20150501133527_ Responsibility Hub, Tata Institute of Social Sciences, New Delhi,Conductedby National CorporateSocial 15”, Commissioned by Rail Vikas Nigam Ltd-RVNL- Report of CSR & Sustainability Projects for FY 2014- Venkatesh Kumar B. Prof., “MidTermSocialAudit IRJSS-2013-157.pdf (LastvisitedonSeptember04,2016) IRJSS-2013-157httpwww.isca.inIJSSArchivev2i119.ISCA- (2013) ISSN2319–3565pp.41-43,availableat9.ISCA- Research JournalofSocialSciences,Vol.2(11),November Sushmita Gahlot,“SocialAuditsinIndia”IRJSS-International 2016) 12_1349177858_07f3d_06.pdf(Last visitedonOctober26, journal-of-scientific-research-(IJSR)file.phpval=October_20 available at-httpwww.worldwidejournals.cominternational- 1, Issue5,October2012ISSNNo2277-8179pp.16-18 IJSR Roy Swapan Kumar, “Social Audit in India: An Overview” Final.pdf(last visitedonOctober26,2016) inpublicationdownloads2aSocial%20Audit%20Toolkit%20 available atSocialAuditToolkitFinal-httpwww.cgg.gov. Governance, Government of Andhra Pradesh, pp. 19-49, Vivek Misra,“SocialAudit:AToolkit”,CentreforGood Mohanty P.KDr.,V.K.Parigi,KurianThomasand (last visitedonMarch23,2016) FAQ_CSR http://www.mca.gov.inMinistrypdfFAQ_CSR.pdf No. 05/19/2015-CSR,dtd.12/01/2016,FAQ,availableat Ministry ofCorporateAffairs’GeneralCircularNo.01/2016, 2013) www.icsi.inStudy%20Material (last visited on December 11, Business Ethics & Sustainability’ p. 199, available at http// ICSI-Professional Programme-ModuleIV-‘Governance, visited onApril15,2016) previous-work/corporate-social-responsibility.aspx(last - International o ry Enfo rcement o Journal f Co rpo Of rate So Scientific cial R Research, esponsibility inI 59 Volume ndia CS

ARTICLE ARTICLE [email protected] Hand InIndia,LittleKanchipuram Deputy ChiefFinancialOfficer Parthasarathy R,ACS Social Audit underCompanies Act, 2013 60 Social auditshaveseveralaimsviz., (vi) (v) (iv) (iii) (ii) (i) Six keystepsareidentifiedforeffectiveSocialauditwhichare: timeliness, accountingandstatutorycompliances. projects orendeavors.Socialauditauthenticatestheefficientutilizationofgrants,transparency, Social auditisanofficialevaluationoforganization’sinvolvementinsocialresponsibility well asnon-financialdisclosurespresentatrueandfairviewoftheconcern. documents andvouchersofanorganizationtoascertainhowfarthefinancialstatementsas Audit isasystematicandindependentexaminationofbooks,accounts,statutoryrecords, Introduction CSR auditprogramcancoveralloranyofthefollowingrisks: • • • • v) iv) iii) ii) i) enhance communitydevelopment. to provideinformationneededimprovetheeffectiveness of programsdesignedto community, to make local social service providers and other beneficiaries aware of the needs of the community andtheassetsthatareavailablefordevelopment ofthelocalsociety, to makeajudgmentofthematerialandmonetaryshortfallsbetween theneedsof community, to assessthetypeofsocialandenvironmentalinfluencethat the donorhasinitslocal how ithasbeenenforcedbytheCompanies Act, 2013. standard. This articleexplains the meaning of social audit and components. CSR audit is based on the comprehensive ISO 26000 financial monitoringarecommonlyassessedsocialresponsibility marketplace practices, fiscalresponsibilitiesand accounting and development, diversity, environment, international relationships, to the social and environmental responsibilities. Community meet theexpectationsofstakeholder groups havingregard It evaluates measurable goals intended to help the business to Corporate on Corporate Social Responsibility (CSR)objectives. Social Audit isanassessmentofthe performance ofa Dissemination ofthereporttoauthoritiesconcerned. Dissemination oftheconsolidatedreporttodecisionmakingcommittee. benefits accrued. Collection ofinformationfromthestakeholdersregardingimplementationand Revision ofsocialaccountsinaccordancewithauditors’recommendation. social accountingandreporting. Verification of the data used, assess the interpretation and comment on the quality of Presenting socialaccountstoauditors management ofpotentialadverse NGOattention,etc. Management of risks associated with external factors like regulatory compliance, Reliability ofmeasuresperformance – Adequacy ofinternalcontroland reviewmechanisms– Effectiveness ofimplementation ofspecific,largeCSRprojects– Effectiveness oftheoperatingframework forCSRimplementation– DECEMBER 2016 I CHARTERED SECRETARY 2 CHARTERED SECRETARY I DECEMBER 2016 61 60 DECEMBER 2016 I CHARTERED SECRETARY iii) ii) i) According toGeoffreyLantos,therearethreekindsofCSRasunder: 3) 2) 1) qualifications the statute, the following may be taken as the recommendatory of underany isprescribed statutoryqualification no Though Qualifications ofSocialAuditors • • • • • • • following Advantages ofsocialauditsincludethe • • Social Audits–aboonorbane both thecompaniesandstakeholders. Strategic CSR –Social Welfare Responsibilities that benefit or philanthropiccauses? the possibleexpensesofbusinessforaltruistic,humanitarian Altruistic CSR–whichiscontributingtothecommongoodat or socialinjuries? Ethical CSR–whichisabouttheresponsibilitytoavoidharms Contribution RegulationAct,2010etc. viz., Companies Act, 2013, Income Tax Act, 1961, Foreign Expert Knowledgeaboutthecomplianceofvariousprovisions Expert Accountingknowledge Expert KnowledgeabouttheactivitiesofSocialWork Enhancing thecompany’simageineyesofpublic Assisting withhumanresourcesgrowthanddevelopment the responsibilities Promoting decision-makingasacommunityandthesharingof disadvantaged Benefiting individualsandfamiliesthatarepooror Promoting communityinvolvement Supporting democracyinthelocalcommunity Helping thecommunitywithplanning the socialconscienceofindividualcorporates. Yet anotheropinionisthatsocialcontributionsshouldbeleftto internal andconfidential. an impositiontodivulgetheinformationwhichtheythink General beliefamongtheCorporatesisthatsocialauditsare CHARTERED SECRETARY I DECEMBER 2016 Social auditunderCompaniesAct,2013 (b) (a) Section 135(3)envisagestheroles oftheCSRCommitteeasunder: comes fromtheprovisionsofSection 135(3). For whatpurposetheCSRCommitteeisformed.Theanswer envisaged undertheAct. 134(3). ThisstressestheimportanceofCSRCommittee as Committee shall be mentioned in the Board’s Report under Section No. Section135(2)mandatesthat,thecompositionofCSR Can the company just form a CSR committee and remain silent? Information regardingCSRCommittee bringing alargesectionoftheCorporatesunderitspurview. is thustospreadthewingsofCSRaswidepossible crossed the limits prescribed therein. The intention of the legislature under thepurviewthoughitsnetworthorturnoverwouldnothave Thus acompanywhosenetprofitcrossedRs.5croreswillstillbe The conditions in Section 135(1) are alternative and not cumulative. of anindependentobservationtheactivitiesCSRCommittee. director. Insistenceofindependentdirectorstressestheimportance directors, out of which at least one director shall be an independent Responsibility Committee of the Board consisting of three or more during any financial year shall constitute a Corporate Social iii) ii) i) Section 135(1)envisagesthateverycompanyhaving: Stress onCSRCommittee: 2013: How Social audit is indirectly enforced by the Companies Act, in indirectlyenforcingthesocialaudit. perusal ofSection135,wecanfindtheintentionlegislature Social auditisnotspecificallydefinedintheCompaniesAct.On a netprofitofrupeesfivecroreormore turnover ofrupeesonethousandcroreormore; net worthofrupeesfivehundredcroreormore; recommend the amount of expenditure to be incurred on the undertaken bythecompayasspecified inScheduleVII; Responsibility Policywhichshall indicatetheactivitiestobe formulate andrecommendtothe Board,aCorporateSocial the Corporatesunderitspurview. possible bringingalargesectionof wings oftheCSRtoaswide legislature isthustospreadthe therein. The intentionofthe have crossedthelimitsprescribed net worthorturnoverwouldnot under thepurviewthoughits crossed Rs.5 croreswillstillbe Thus acompanywhosenetprofit are alternativeandnotcumulative. The conditionsinSection135(1) Social Audit underCompa nies Act 61 , 2013

ARTICLE ARTICLE 3) 2) 1) The conditionsare: Social ResponsibilityPolicy. immediately precedingfinancialyears,inpursuanceofitsCorporate average net profits ofthecompanymadeduring three company spends, in every financial year, at least two per cent of the company referredtoinsub-section(1),shallensurethatthe Sub-section 5ofSection135envisagesthattheBoardevery Quantum ofCSRspending (a) The Boardof every company referred to in sub-section (1) shall,— evident fromsub-section4toSection135asunder: Companies Act,2013ensuresthetransparentCSRPolicyas its Report, disclosed in the website of the company. Thus the CSR Policy so formed, shall be, in addition to be mentioned in Responsibility iscastontheBoardtoensurethatcontentsof Disclosure ofCSRPolicy Social Audit underCompa nies Act 62 4) (c) (b)

company fromtimetotime. monitor theCorporateSocialResponsibilityPolicyof activities referredtoinclause(a);and by thecompany. Social ResponsibilityPolicyofthecompanyareundertaken ensure thattheactivitiesasareincludedinCorporate prescribed forthepurposeofCSR spendingalso. net profitsforthepurposeof managerialremunerationis under Section198.198 prescribedforcalculationof recalculated takingintoaccount theadjustmentsrequired Loss Account.Itisclearthat thenetprofitsshallbe Net profitsisnottheProfitafter tax mentionedintheProfitand Net profitscalculatedunderSection198 below the2%ofnetprofits. words, companyisatitslibertytospendmorebutshallnotfall Quantum prescribedisnot2%but“atleast2%”.Inother At least2% year. (1) ofSection135,itshallspendtheamountineveryfinancial As longasthecompanycomeswithinpurviewofsubsection Spent ineveryfinancialyear Average of the net profits for 3 immediately preceding Average ofthe netprofitsfor3immediately prescribed; and on thecompany’swebsite,ifany,insuchmannerasmaybe disclose contentsofsuchPolicyinitsreportandalsoplaceit Corporate SocialResponsibilityPolicyforthecompanyand Corporate SocialResponsibilityCommittee,approvethe after takingintoaccounttherecommendationsmadeby , 2013 committed itselfto. organization livesuptothesharedvaluesandobjectivesit has limitations. It is a way of measuring the extent to which an demonstrate itssocial,economic,andenvironmentalbenefits and Social auditingthusenablesanorganizationtoassess and which thecontraventioncontinues. extend toonethousandrupeesforeverydayafterthefirstduring contravention iscontinuingone,withafurtherfinewhich may with fine which may extend to ten thousand rupees, and where the company whoisindefaultorsuchotherpersonshallbepunishable provided elsewhereinthisAct,thecompanyandeveryofficerof given or granted, and for which no penalty or punishment is direction or exemption in relation to any matter has been accorded, which anyapproval,sanction,consent,confirmation,recognition, thereunder, or any condition, limitation or restrictionsubject to contravenes any of the provisions of this Act or the rules made If acompanyoranyofficerofotherperson becomes operative,whichreadsasunder: The answerisabsoluteno.Insuchacase,Section450oftheAct report ? do awaywiththenon-compliancebyamerementioninginitsBoard come toknowofthedefault.Insuchacase,cancompanyjust legislature inthisprovisoisthatthemembersofcompanyshall shall bereportedbytheBoardinitsreport.Intentionof non-spending orshortspending.Itonlyenvisagesthatthesame Section 135donotprescribeanypenalty for non-complianceviz., amount. section (3) of section 134, specify the reasons for not spending the amount, theBoardshall,initsreportmadeunderclause(o)ofsub- Second Provisosaysthatifthecompanyfailstospendsuch Non-compliance ofSection135 local areasshallbegivenpreference. pains ofthepeopleonsurroundings,Actstressesthat resources and the life of the people living around it. To mitigate the company hasitsimpactonthesocialsurroundings,natural The intentionofthelegislatureisobvious.Existence Corporate SocialResponsibilityactivities. it whereoperates,forspendingtheamountearmarked company shallgivepreferencetothelocalareaandareasaround The Provisotosub-section(5)ofSection135saysthatthe Scope oftheCSRactivities www.transcampus.org 3 www.schemaadvisory.com 2 1 Acknowledgements prescribes themethodforcalculatingnetprofit. “average ofthenetprofit”inasmuchSection198 drafting errorthat“averagenetprofit”shouldhavebeen not explained in the Act, means the simple average. There is a three immediatelyprecedingfinancialyears.Average,though as awhole,theActenvisagesaverageofnetprofitsfor into account,thefluctuationsinbusinessofcompany Again itisnotthenetprofitforsingleyearalone.Taking Credibility andTransparency”by JUBAzubike. “Impact ofSocialauditingonCorporate Governance,Corporate “Auditing CorporateSocialResponsibility” Downloaded fromwww.smallbusiness.chron.com Kokemuller inHoustonChronicle. Article on“WhatisaCorporateSocialAudit”byMr.Neil financial years. financial 3

DECEMBER 2016 I CHARTERED SECRETARY CS CHARTERED SECRETARY I DECEMBER 2016 63 62 DECEMBER 2016 I CHARTERED SECRETARY [email protected] Pune Company Secretary C.B.Prabhumirashi, Social Audit intheContext ofCSR CHARTERED SECRETARY I ACS DECEMBER 2016 I Social Audit Act, andprovidesaroughroadmaptostructureplanSocial AuditsforCSRprojects. The currentnoteexaminesvariousaspectsofSocialAuditwithspecialreferencetoCompanies social objectives. for are used resources is how audit of asocial concern costs andfinance–thecentral does notmerelyconsistinexamining Auditing is used,Social the term‘Audit’ Although participatory fashion. in a publicly and shared is analyzed The information of anorganization. resources The World BankconsidersSocialAuditas a process, that collects information onthe impacted by theintervention. employees, volunteersandthebeneficiaries funders, These stakeholdersinclude, and interactingwithkeystakeholders. processes of an non-financial objectivesthroughsystematic organization’s and regularmonitoring In the historicalcontext, Social Audithasbeenassociatedwithmeasuringthe impact (1) “Section 135.CorporateSocialResponsibility better understandingtheconcept ofSocialResponsibilityaCorporateSector. The saidSection&Schedulethereof oftheCompaniesAct,2013arereproducedbelowfor under ScheduleVIIoftheAct. mechanisms totrackandreport theprogressofsocialdevelopmentprogramsasmentioned Section, thesecompanies(to whomtheaboveSectionisapplicable)havetoevolve programs on a project mode in accordance with its approved CSR policy. Therefore, under this Section 135 of theCompaniesAct,2013hasmandatedcertainto undertake the organization oranentityhasliveduptotheagreedcommonsocial objectives. environmental benefits.Itisawayofmeasuringandevaluating theextenttowhichan Social Auditingenablesanorganizationtoassessanddemonstrate itssocial,economicand social accountability. independent evaluationoftheperformanceanorganization and aninstrumenttomeasure performance inordertoachieveimprovementandsuggestcourse correction.Itisalsoan performance of an activity of the organization. It also measures and reports the social Social Auditreferstoaprocessformeasuring,understanding andimprovingthesocial use SocialAudit as an information toolto influence in governments’decisionmaking processes. achievements oftheinstitutionsthatclaimsocialdevelopment.CommunityBasedOrganizations In general,CivilSocietyOrganizationsundertake‘SocialAudit’tomonitorandtrack evaluate theirperformance. process, the executive and the legislature are evaluating newer ways of Social Audit to its socialgoals.Itisaninstrumentofaccountabilityorganization”Inthegovernance independent evaluationoftheperformanceanorganizationasitrelatestoattainment The CentreforGoodGovernanceinitssocialaudittoolkitdefinesSocialAuditas“an resources includingpublicservices,policiesanddecisions. quality ofpublicresourcesincludingservices, policiesanddecisions. strategies. Itisalsooneoftheways of understanding thequantityand evaluating democratic governance and a tool to implement anti-corruption suggest course correction. Social Audit has become a key component of and reportsthesocialperformanceinordertoachieveimprovement the socialperformanceofanactivityorganization. Italsomeasures Social Audit refers to a process for measuring, understanding and improving Every company having net worth of rupees five hundred crore or more, or turnover of strategies. It is also one of the ways of understanding the quantity and quality of public component ofevaluatingdemocraticgovernanceandatooltoimplementanti-corruption n the context of Welfare State in a country like India, Social Audit has become a key 63

ARTICLE ARTICLE Social Audit intheContexofCSR 64 (5) (4) (3) (2) amount earmarked for Corporate Social Responsibility activities: area andareasarounditwhere itoperates,forspendingthe Provided thatthecompanyshall givepreferencetothelocal pursuance ofitsCorporateSocial ResponsibilityPolicy: made duringthethreeimmediately precedingfinancialyears,in least twopercent.oftheaverage netprofitsofthecompany ensure thatthecompanyspends,ineveryfinancialyear,at The Boardofeverycompanyreferredtoinsub-section(1),shall (b) (a) shall,— The Boardofeverycompanyreferredtoinsub-section(1) (c) (b) (a) The CorporateSocialResponsibilityCommitteeshall,— Committee. disclose the composition of the Corporate Social Responsibility The Board’sreportundersub-section(3)ofsection134shall director shallbeanindependentdirector. consisting ofthreeormoredirectors,outwhichatleastone of the BoardCommittee Responsibility Social Corporate crore or more during any financial year shall constitute a rupees onethousandcroreormoreanetprofitoffive respect tothespecificCSRproject Auditor willalsoverifybookswith qualitative information. The Social capturing bothquantitativeand will facilitatetheresearcherin mixture oftechniquesthat The Social Auditor willusea milestones andbudgetallocations. of theproject, objectives, agreed such as, CSRpolicy, background the projectwithsocialauditor sharing asmuchinformationabout social auditlieswiththecompany The essentialsforanunbiased vis-à-vis vis-à-vis by thecompany. Social ResponsibilityPolicyofthecompanyareundertaken ensure thattheactivitiesasareincludedinCorporate as maybeprescribed;and place it on the company’s website, if any, in such manner and disclosecontentsofsuchPolicyinitsreportalso the CorporateSocialResponsibilityPolicyforcompany the CorporateSocialResponsibilityCommittee,approve after taking into account the recommendations made by company fromtimetotime. monitor theCorporateSocialResponsibilityPolicyof the activitiesreferredtoinclause(a);and recommend theamountofexpendituretobeincurredon Schedule VII; activities tobeundertakenbythecompanyasspecifiedin Social Responsibility Policy which shall indicate the formulate andrecommendtotheBoard,aCorporate sanctioned budget. (x) (ix) (viii) (vii) (vi) (v) (iv) (iii) (ii) (i) Activities relatingto:— companies intheirCorporateSocialResponsibilityPolicies This Schedulepertainstotheactivitieswhichmaybeincludedby Schedule VII(Section135):- 3. 2. 1 public scrutinyandlegalcompliance. SocialAuditshouldaimto: implementation ofpoliciesasplannedbutalsohelpsaddressintense projects are no exception. It not only helps to be assured of plan aspartofanysuccessfulprojectimplementationandCSR It’s important to have strict and accurate monitoring and evaluation it helpsensuregreaterverifiabilityofdataandaccountability. perception ofCSRprojectsandinputstothepolicy.Internally, limitations toexpectedimpact.Itwillalsoprovidemulti-stakeholder It willaidCompaniestounderstandthecurrentimpact and implementation oftheCSRproject. andthefinalinconsistencies betweenagreedobjectives social objectivesoftheCSRproject.Itisexpectedtoidentify Social Auditisatransparentprocesstomeasureandreport the Scope andObjectivesoftheocialAudit financial information. audit gearedtowards verification of reliability andintegrity of Social Auditinitiated by theCorporatesmayalsoincludefinancial unintended impactsofsocialdevelopmentprojectstheirgeographies. It alsohelpstomonitorconsequencesoftheintendedand manage andmeasureCSRsponsoredsocialdevelopmentprojects. 2013, Social Audit is a tool through which companies can plan, In the context of Section 135 & Schedule VII of the Companies Act, to trackandreporttheprogress. to the social activities, Social Audit becomes even more prominent by theCorporateSectoraswelldepthinvolvedwithrespect Considering the huge amount spending on various social activities Reasons forcarryingouttheSocialAudit such othermattersasmaybeprescribed. Tribes, otherbackwardclasses,minoritiesandwomen; funds for the welfare of the ScheduledCastes, Scheduled Governments forsocio-economicdevelopmentandrelief other fund set up by the Central Government or the State contribution to the Prime Minister’s National Relief Fund or any social businessprojects; employment enhancingvocationalskills; ensuring environmentalsustainability; deficiency syndrome,malariaandotherdiseases; combating humanimmunodeficiencyvirus,acquiredimmune reducing childmortalityandimprovingmaternalhealth; promoting genderequalityandempoweringwomen; promotion ofeducation; eradicating extremehungerandpoverty; section 198. profit” shallbecalculatedinaccordancewiththeprovisionsof Explanation. —Forthepurposesofthissection“averagenet the amount. section (3) ofsection134, specify the reasons for not spending the Boardshall,initsreportmadeunderclause(o)ofsub- Provided furtherthatifthecompanyfailstospendsuchamount, a transparentandfairway. Assist CSRSub-Committeeplan andexecuteCSRactivitiesin met assignedresponsibilities. Facilitates CSR team to understand how each stakeholder has and undertakecoursecorrections. Track, assessandreporttheprogress ofthesponsoredproject DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 65 64 DECEMBER 2016 I CHARTERED SECRETARY 4. 3. 2. 1. social auditreportcontainingsomeofthefollowingcomponents: The Government is required to decide to have a framework of the Social AuditReport activities social responsibility and anintegralpartof company’s annualreportdevotedto of toAct, Directors reportincompliancetheCompanies2013 audits. TheauditreportalsohelpsindraftingBoard undertake the strongestanddetailedsocialaudittoolsbuiltinto that hasundertakenimpactassessmentsastheyhaveoneof United NationbodiesorWorldBanklargescaleorganization It tohireanagencythathasworkedwith would beappropriate subject toauditreports. evaluation. The credibility is essential if the donation tranches are audit conductedbyanoutsideauditorwillbringcredibilitytothe in conducting social audits. It is a matter of fact that the financial could beanotforprofitorganizationorprivateentityspecialized or Chartered Accountant) or agency to reduce biases. Social Auditor consultant (likePractisingCostAccountantorCompanySecretary company. However,itisadvisabletohaveconductedbyanoutside The auditingprocessmaybeconductedinternallybythedonor Social Auditor sanctioned budget. also verifybookswithrespecttothespecificCSRprojectvis-à-vis both quantitativeandqualitativeinformation.TheSocialAuditorwill mixture oftechniquesthatwillfacilitatetheresearcherincapturing milestones andbudgetallocations.TheSocialAuditorwillusea such as,CSRpolicy,backgroundoftheproject,objectives,agreed sharing asmuchinformationabouttheprojectwithsocialauditor The essentials for anunbiasedsocialaudit lies with the company and implementation Implications ofpolicy,program 4.

future CSRprojectsbasedontheirstrengths. Assess thecapabilitiesofimplementingpartnersandplan stakeholders- Corporatesector onitsowncandecidethe Perception of the Company and implementing Year. corporate entityforthatparticular Financial by the be checkedwiththebudget, ifany,prepared can accounting activities. These expenses spent onsocial can bethebaseof whethertheamountactually auditors to these submitted of expenses accounting and papers / Secretarial Auditorcanbehelpful.Thedocumentation reports submittedbytheStatutory Auditor aswellthe Status of social accounting and book keeping - The activity orprogramme. part ofSocial the particular to takeactiondevelop as thestatisticsandalso to preparethedata-baseaswell this to Section wasmadeapplicablethem. This will enable when since Years the Financial Sector during Corporate carry out analysis of the contributions made by the Techniques to of analysis-TheGovernmentisrequired scope ofSocialAuditcanalsobewidened. the scopeof CSR activities,andasaresultof this, the allthecompaniesunder to bring section canbewidened of this to theGovernment.Thebase helpful be shall Act, 2013 VII oftheCompanies & Schedule 135 Section For thatpurpose, Sector tosharetheSocialResponsibility. backing bywhichtheGovernmentcanseekCorporate Context of the social audit - This shall containthe legal CHARTERED SECRETARY I DECEMBER 2016 . 6. Summary and conclusion - After going throughthe above of the 5. Perceptionofthebeneficiaries-Themanagement Companies spent9.7croresonaverage. rupees. PSUsonanaveragespent46.8crorewhilePrivate 2387 crores while the 409 private companies spent 3951 crore (PSUs) and 409 Private companies. The 51 PSUs spent a total of were spentonCSRactivitiesby51PublicSectorUndertakings According tothedatareleasedbyMCA,atotalof6338crorerupees such abigamountofCSRActivities. Crores and the total no. of Companiesis7334whichhave incurred during theFinancialYear2014-15whichisamountingtoRs.8802.90 total expenditureincurredonCSRActivitiesbytheCorporateSector The MinistryofCorporate Affairs hasreleasedinformationonthe Actual PositionofCSRSensitivityinIndia Section 135 of Companies Act, Section 135ofCompanies2013. under are covered which for companies mandatory now as is the formofaReport in Government to theCentral as as well of thecompany to theShareholders addressed Government. TheconclusionofthisAuditshallbe the Central to solvethesamesomeextentalongwith to theseproblems their contribution and of India problems sectoraboutthesocial form ofsensitivitythecorporate of thistypeauditcanbeinthe sector. Theconclusion & CSRActivitiesofthecorporate out theauditofSocial carrying while he hasconfronted / observations findings Auditor canmakesummaryofthe points, theSocial where itcaneffectivelycontribute. areas particular the companytoconcentrateon help section. Thiswill stated inthesaid activities thatareclearly details of requirements asstatedinSection135andthe It go into planned. should to beproperly activity isrequired & every each stakeholders. Forthatpurpose, relevant benefits of such socialprogrammesandactivitiesto the the likely to takeintoaccount required is also company company initsAnnualReporttotheShareholders. of the by theManagement to bedisclosed required andactivitiesare All theseprogrammes programmes. of & theareasforimplementationsuchsocialactivitiesand of therelevantstakeholders may takeintotheconfidence discretion of the Management of the Companies.They of implementation theprogrammecanalsobeasper spent aspertheSectionofCompaniesAct, 2013. The the amounttobe social activitiesbutafterconsidering depth of the socialproblemand can selectanyof these Social Audit intheContexofCSR 65

ARTICLE ARTICLE Following aresome oftheBigCorporateswhich havespecified position. presence ofITCompanieshad only47projectsandisinthe15th states in the top 10. Surprisingly, Telangana that has a large Bengal (79),MadhyaPradesh (71)andDelhi(66)aretheother Rajasthan (89), Uttar Pradesh (80), Andhra Pradesh (79), West were inTamil Naduwhile95projects wereinKarnataka. projects with202followedbyGujarat(111projects).97 36 differentStates/UTs.Maharashtraleadsinthenumber of A totalof1790projectswereundertakenunderCSRin2014-15 in Projects the all of 1/6th than more for account Gujarat & Maharashtra Top 10SpendersofCSRActivities(isinRs.Crores)- accounted for56%ofthetotalCSRspend. for 43.5%ofthetotalCSRspendwhiletop20companies are alsointhetop10 spenders. The top 10 spendersaccounted India (Infosys, TCS&Wipro).StateownedNTPC,NMDCOil crores. Three out of the top 10 are companies from the IT Sector the mostwith760.6crorerupeesfollowedbyONGC495.2 remaining 11 are private companies. Reliance Industries spent Out of the top 20 spenders under CSR,9are PSUs and the 9 oftheTop20spendersarePSUs Social Audit intheContexofCSR 66 Financial Year2014-15. tried tohelpcarryoutCSRactivitiesinIndiaduringthe Following is the listofTop20 such companieswhich have

20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 No. Sr. Total Cairn IndiaLimited LARSEN ANDTOUBROLIMITED HINDUSTAN UNILEVERLIMITED MAHINDRA ANDLIMITED NORTHERN COALFIELDSLIMITED BHARAT HEAVYELECTRICALSLIMITED INDIAN OILCORPN.LIMITED HDFC BANKLIMITED AXIS BANKLIMITED WIPRO LIMITED OIL INDIALIMITED ICICI BANKLIMITED TATA STEELLIMITED NMDC LIMITED NTPC LIMITED TATA CONSULTANCYSERVICESLIMITED ITC LIMITED INFOSYS LIMITED OIL ANDNATURALGASCORPORATIONLIMITED RELIANCE INDUSTRIESLIMITED Name 3778.5 70.3 76.5 82.4 83.0 101.6 102.1 113.8 118.6 123.2 132.7 133.3 156.0 171.5 188.7 205.2 210.4 214.1 239.5 495.2 760.6 (In Crores) CSR Spent villages. villages. MANSI project, Tata Steel is scaling up the project to cover 1,500 Based ontheearlyevidenceof successandlearningsfromthe by 26.5%, increase in institutional delivery from 58% to 81%. 32.7%, reductionininfantmortality (uptotheageofoneyear)rate outcome indicators,suchasreduction in neonatal mortality by mortality. MANSI has achieved improvement in all process and district since2009.Theprojectgoalsaretoreducechildandinfant oftheSeraikelablockJharkhand’sSeraikela-Kharsawan villages (MANSI), a public-private initiative, is being implemented in 167 Flagship Programme:MaternalandNewbornSurvivalInitiative 2.04% oftheaveragenetprofitlastthreefiscals. spending in2014-15onCSRwasRs171.50Crores,which is Total Odisha andChhattisgarh,coveringnearly500corevillages. and sports. Initiatives run across ten districts in Jharkhand, preservation ofethnicityandcultureindigenouscommunities empowerment andsustainable livelihoodopportunities, Key CSRAreas:Education, healthcare, facilitation of 3. internationally. bodies seedsofMahseerinexcess10MillionIndiaand programme hasproducedanddistributedinvariouswater restoration andeco-developmentprojectforthelakes.The Power setupabreedingcentreinLonavalaaspartofitseco- initiative startedin1975forsavingendangeredspecies.Tata Flagship Programme:‘ActforMahseer’,aconservation requirement ofRs17.2Crores. ventures ofthecompanywasRs18.20Croresasagainst Crores. Further,theCSRspendingofsubsidiariesandjoint 31.10 Croresasagainstthe2%ofPATrequirementRs29.8 livelihood generation.ItstotalCSRspendinginFY15stoodatRs conservation, women empowerment, skill development and development, health,safety,security,resourceandenergy Key CSRAreas:Education,environment,community 2. and curtailingdropoutstolessthan10%. project includeanincreaseinbothenrolmentofgirlsschools support (workbooks,studyclasses).Thekeyoutcomesofthe (uniforms, bags,notebooks,shoesandsocks)academic underprivileged girlsintenstates,providingmaterialsupport Project NanhiKalisupportstheeducationofover11Lacs Flagship Programme:SetupbyAnandMahindrain1996, crore —2%ofPAT. Vidyalaya. ExpenditureonCSRinthelastfiscalwasRs83.24 in governmentschoolsaspartofSwachhBharat locations across11statesand104districtsspecificallyforgirls of ArakuValley.M&Mhasconstructed4,340toiletsin1,171 million treestilldate,includingfourinthetribalbelt communities Thenthere’sProjectHariyali,whichhasplanted7.9 Lifeline Expresstrainsthattakemedicaltreatmenttofarflung Chennai, Patna,ChandigarhandSrinagar.M&Msponsorsthe communities andhavetrainedover13,000youthinPune, training toyouthfromsociallyandeconomicallydisadvantaged and environment. Mahindra Pride Schools provide livelihood through programmesinthedomainsofeducation,publichealth Key CSR Areas: 1. Activities intheFinancialYearending31.03.2015. their own“KeyCSRAreas”&“FlagshipProgramme”under Tata Steel Tata Power Mahindra & Mahindra

DECEMBER 2016 Focus on the girl child, youth and farmers I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 67 66 DECEMBER 2016 I CHARTERED SECRETARY Skills (GIS) is also working towardsbridging the skillgap faced by scholarships once they get into IITs/NITs. The GAIL Institute of provided residentialcoaching programmes andgivenmonthly communities joinIndia’spremier engineeringinstitutes.Theyare helped over500students fromeconomicallybackward and environment.ThroughGAILUtkarsh,thecompany has like health,sanitation,education,skilldevelopment,livelihood, Key CSR Areas: 7. GAIL implementation partnerprovidestheorytraining. the trainee while Tata Motors contributes the rest. The provide the training and contribute two-thirds of monthly stipend of (NGOs andTechnicalTrainingInstitutes)arepartners.Dealers at service centres. Tata Motors’ Dealers, implementation partners theoretical learningissupplementedthrough‘on-the-job’exposure mechanic motorvehicletraining,ayear-longprogrammewhere Flagship Programme: Learn, Earn and Progress (LEAP) for 18.62 CroresonCSRin2014-15,despitereportinganetloss. of RAMashelkar,whichmonitorsCSRperformance.ItspentRs has created a CSR Committee of the board under the chairmanship automotive tradesareimplementedacrossIndia.Thecompany but employabilityprogrammesfocusedonbuildingskillofyouthin Most programmesareinthevicinityofmanufacturinglocations Key CSR Areas: 6. the scientificstudyofspeciestoensureitslong-termsurvival. whale sharkshavebeensaved.Thecompanyisnowinvolvedin engaging withfishermenandschoolcommunities,morethan498 inflated shark flotillas, community meets, postage stamps and decade ofcampaigningthroughstreetplays,games,posters, slaughter byfishermenalongtheGujaratcoastforexport.Aftera the world’s largest fish, which was fast depleting because of started in 2004, aims to spread awareness about the whale shark, Flagship Programme: ‘ standalone PAT. fiscal, it spent Rs 12.76 Crores on CSR, amounting to 2.93% of abatement strategy forsustainable manufacturing. Inthe last change policythatmapsitscarbonfootprintandiscreatingan and preserving the ecosystem. Thecompany has a climate Key CSRAreas:Focusedonsustainablecommunitydevelopment 5. over theyearsto150.Thiswillbenefit75,000villagers. Maharashtra, takingthetotalnumberofcheckdamsconstructed of 50 check dams in Talasari block of Palghar district in Flagship Programme: L&T recently committed to the construction three years. amounting to1.44%oftheaveragenetprofitforpreceding rural youth.Inthelastfiscal,L&TspentRs76.50CroresonCSR, Institutes (CSTIs),establishedin1994,provideskillstrainingto Lonavala andKansbahal.L&T’sConstructionSkillsTraining Thane, Ahmednagar,Hazira,Vadodara,Coimbatore,Chennai, AIDS. L&T’scommunityhealthcentresarelocatedatMumbai, leprosy control, integrated counselling & testing centres for HIV/ programmes focused on reproductive health, tuberculosis & skill building.L&Tpartnerswithlocalgovernmentsonhealth Key CSRAreas:Waterandsanitation,education,healthcare 4. Tata Motors Tata Chemicals L&T CHARTERED SECRETARY Education and employability (skill development). Supporting communities in multiple thrust areas Save the Whale SharkCampaign’, I DECEMBER 2016 Foundation, spansseveralstatesacrossIndia. program, an initiative in partnership with the Akshaya Patra Flagship program: 15, Infosysspent239.50CroresonCSRactivities. training inunderrepresentedcommunities.InFinancialYear2014- divide in America bysupportingcomputerscienceeducation and culture. Infosys Foundation USA is focused on bridging the digital abandoned womenandchildrenpreservingIndianart infrastructure, supportingprimaryeducation,rehabilitating Sudha Murty, towards removing malnutrition, improving healthcare Key CSRareas:WorkswithInfosysFoundation,headedby 9. Infosys 7 CroresLitresofwaterbenefittingover5,500families. positive. In 2014-15, 40 villages were made water positive by creating Rajasthan, UttarPradeshandAndhraPradesh,makingthemwater extended toover140villagesinMaharashtra,TamilNadu,Karnataka, along BPCL’sproductpipeline.Inthepast6years,ithasbeen drought-free. ItbeganwithfourvillagesinMaharashtra,whichwere construction of rain water harvesting structures to making villages Flagship Programme:ProjectBOOND,whichhasevolvedfromthe Bharat SwachhVidyalayaprojects. been carriedtothecurrentfiscal,andhasspentonSwachh Rs 76 Crores,ofwhichit spent Rs34.0 Crores. The balance has and ruraldevelopment.In2014-15,BPCLhadaCSRallocationof unemployed youthandpersonswithdisabilities),health/hygiene to theunderprivilegedwithaninclusiveapproachforwomen, conservation, skill development (employment linked skill training secondary education and empowering teachers), water Key CSR Areas: Qualityeducation(strengthening primary, 8. its areasofoperation. job-linked skilltrainingtolocalyouthofcommunitiesinandaround addresses the issue of unemployment and skill gap, by providing Flagship Programme:GAILhasestablishedGISwhich Crores onCSRactivities. states and UTs. In the Financial Year 2014-15, it spent Rs 43.0 the oilandgasindustry.GAIL’sCSRprogrammeoperatesin25 3. 2. 1. References: development projects. tracking, monitoringandreportingforsuccessfulsocial CSR projectproposalswithbuilt-incomponentsforregular updating internalcommunicationchannels.It’stimetoincorporate Extracts from the Social Auditreportare an excellent way of Committee, senior management and inputs to CSR policy. It also helps in providing timely project updates to CSR Sub- context ofmanagingCSRprojects. personnel tounderstandthesignificanceofSocialAuditin the for betterprojectmanagement.ItisessentialeveryCSR ways ofmonitoringandevaluationvis-a-vissocialauditpractices have tolevel-uptheirconceptualclarityindifferentiatingtraditional actual CSRactivitiesinIndia,itistimethatthepersonnel In thecontextofmanaginglargescaleprojects&position of Conclusion Bharat Petroleum The EconomicTimes dated26thOctober,2015. 2014-15. MCA Report of Actual CSR Expenditure of Financial Year Relevant Section&ScheduleVII ofCompaniesAct,2013. The Infosys Foundation mid-daymeal Social Audit intheContexofCSR 67 CS

ARTICLE ARTICLE [email protected] Bengaluru S. Rajarathinam,ACS Social Audit for Social ResponsibilityofEnterprises need 68

enforce theenterprisestofulfiltheirsocialobligationassumes greatimportance. system ofpublicAccountability.Inthiscontexttheconcept ofSocialAuditwhichcan enterprises indischargingthesesocialresponsibilities.This is possible onlythrougha Shareholders’ rights.Nomechanismexiststobringinto focustheperformanceof protection of consumers’ rights, safeguard of interest of workers and protection of enterprises. Environment is onlyoneaspect of responsibility. Equally important are: awareness oftheirsocialresponsibilitiesinthisareaishardly aseriousagendawiththe establish anuclearpowerplantatEdinburg.Unfortunately,genuine concernandgreater measures. Public resistance in Edinburg has not allowed the British Government, to the peoplehasforcedindustriesandgovernmentstotakecertainpreventive industrial revolutionisstillgoingon,thoughinsubtlerform.Greaterawarenessamong The confrontationwhichbeganbetween industry andenvironmentfromthebirthof more thanbread. ugly relationshipbetweenworkersandemployers.Thehumansoulneedsbeautyeven ugly ideals,religion,hope,love,clothes,furniture,houses, condemning oftheworkerstougliness,meaninglessandformlessuglysurroundings, classes and promoters of Industry committed in the palmy Victorian days was the betrayed thespiritofmaninnineteenthcentury.Thegreatcrimewhichmoneyed than D. H. Lawrence; Now though perhaps nobody knew it, it was ugliness which really social offenders, nobody could perhaps portray the baneful effects of industrialisation brought immensebenefitsandprosperitytotheSociety,industrieshavebeenworst While thewheelofindustrialandtechnologicalprogresscannotbestoppedithas repay theirdebtstothesociety. on thesocietyfortheirexistenceandorganizationshouldbemindfulofneedsto and totallyindebtedtothesociety.Similarly,allorganizations,bigorsmall,aredependent alone, anindividualcannotmakeevenapinorpen;Heistotallydependentonothers of thegreatestPhysicisttwentiethcenturywhowasalsoaphilosopher.Left have receivedandamstillreceiving’.Thesewordscamefromdeepfeelingforhumanity living and dead ,and that I must exert myself in order to give in the same measure as I day, I remind myself that my inner and outer life are based on the labours of other men, Albert Einsteinin his famousbook“TheworldasI see it”wrote;Ahundred times every INTRODUCTION by theprivate company escapesanysuchpublic scrutinywhilethefunds usedbythe Committees andtheParliament ingeneralthroughquestions,motionsetc.Butspending General, theexaminationby PublicAccountsCommitteeandtheUndertakings been ensuredthroughstrict system ofcontrol.ScrutinybytheComptrollerandAuditor interest and should not be frittered away. Public accountability of Government funds has spending isunderstrictscrutiny becauseitistaxpayers’moneywhichmustbeinpublic hardly anydistinctionbetween Governmentfundsandprivatefunds. Accountability of Enterprises is essential because of two main factors. First, there is DISTINCTION BETWEENGOVERNMENTFUNDSAND PRIVATEFUNDS their socialobligationassumesgreatimportance. concept ofSocial Audit whichcanenforcetheenterprisestofulfil only throughasystemofpublicaccountability. Inthiscontextthe enterprises indischargingtheirsocialresponsibilities. This ispossible No mechanism exists to bring into focus the performance of DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 69 68 DECEMBER 2016 I CHARTERED SECRETARY and perhapsoblique expressionofit.The factthatpublic open channels for public approval or criticism, as an informal imperfect, expression of public interest, and also effective and pressure whichincludesthe lawasaformal,ifperhaps And clearlydependsontheir beingeffectivepublicpressure- has much to gain by observing them and much to lose by not . appropriate standards and which then ensuresthata company only onprovisionofinformation,butasystemwhichsets Charles Medawarsays“effectiveaccountabilitydepends not pioneering work‘theSocialAuditConsumerHandbook(1978), government andcorporateresponsivenesstothesociety.In his has beenapioneerincreatinggreaterawareness of Social AuditLimited,London,anon-profitmakingorganization THE PIONEERS 4) 3) 2) 1) social obligationsinthefollowingfouridentifiedareas: terms ofthedegreetowhichcompanieshavefulfilledtheir Public Accountability of the corporate sector can be analysed in ASPECTS OFSOCIALACCOUNTABILITY first principleinsecuringresponsiblebehavior. workers andcommunity”.Opennessin‘corporateaffairsisthe disclosure that the company make available for creditors, responsibilities mustbereflectedintheinformation,and recommended (1978)“Acceptanceofconceptsocial The SacharPanelheadedbyJusticeRajinder community ingeneralhavebeenaffectedbytheirexistence. about their actions, their operations, their impact and how the are outsidethepublicpurview.Thesocietyhasarighttoknow governmental activities,theactivitiesofbigprivateorganizations society. While people are constantly watching andregulating organizations have an obligation to repay their debt to the dark aboutthelethalmaterialcompanywashandling.All how thegovernment,publicandworkerswerekeptin operations ifgowrong,canaffectthelivesforgenerationsand which isthebiggestindustrialdisasterhasshownhow operations of these organizations. The Bhopal gas tragedy and howthesocietyhasbenefitedorbeenaffectedby to assessashowtheyhavedischargedthesocialobligations control the policies of the government. It is, therefore, essential advanced industrialcountries,theyconsiderably influence and resourceful andpowerfulthanmanygovernments.Evenin policies and actions and products. Some ofthem are more influence thelivesofmillionspeoplealloverworldbytheir society. Alargenumberoforganizationsaremulti-nationalswho their existencetothesocietyandearnprofitsfrom Secondly, andmostimportantlytheprivateorganizationowe introduced. accountability asitexistsforGovernmentfundsisrequiredtobe funds andprivatefunds.Therefore,asystemofpublic corporate worldthereishardlyanydistinctionbetweenpublic and onlyasmallportionisheldbytheowners.Into-day’s held bythepublicfinancialinstitutionslikebanks,L.I.Cetc, shares ,debenturesanddeposits;alargepartofthefundsare private arecontributedbythecommonpeopleinfavourof private companies are hardly private. Bulk of the funds in the (e.g.-environment, pollutionetc.) Social responsibilitytotheSocietyandlocalcommunity Social responsibilitytotheshareholders. Social responsibilitytotheirownemployees. Social responsibilitytotheconsumer. CHARTERED SECRETARY I DECEMBER 2016 Pollution) Act,1981. control ofPollution)Act,1974 and Air(Preventioncontrolof required toberegulatedaccording toWater(Preventionand wastes. InIndia,thestandards ofqualityairandwaterare taken toreducethelevelofdischarge, emissionortotreatthe requirements, standards or objectives and the steps it has the companyororganization hascompliedwiththelegal sewers ,industrialpollutants)socialAuditmustfindoutwhether gas, dust)andwaterpollutions(dischargeofcitywaster, Science, London.Asregardsairpollution(emissionofSmoke, departments or the British Society for Social Responsibility in Inspectorate, the manufacturers, the trade union research will have to be obtained from other sources- the Factory more oftenthannotunwillingtodoso.Therefore,theinformation the workplaceandmonitoringhedoes.Butemployer is about theknownandsuspectedhazardsofsubstances at 1974,an employershouldgivetheemployeeinformation in factories .Under the British Health and safety at Work Act U.K, thereisveilofsecrecyabouttheharmfulsubstancesused and foundinenvironment.Inmanywesterncountriesincluding information on toxic chemicals and substances used in factories evidenceand collect investigation intothehazardsand this handbookFrankelexplainshowtomakeindepth Maurice Frankel’s ‘Social Audit Pollution Handbook’ (1978). In Another pioneeringworkinthefieldofSocialAudithasbeen the corporatesectorshouldbeachievedbysocialaudit. interest are of overriding importance and full accountability of raised inhisconsumerHandbook.Medawarthinks the product?ThesearesomeofquestionsMedawarhas business and with what guarantee? What is the real worth of standards of behaviours the society can reasonably expect from goes on in business and other centres of power? What tell thecorporatebodysamethinginway’.What human bodythatsomethingiswrongwithit.Publiccriticismmay mean itisnoteffective.Painanobliquewayoftellingthe criticism isoblique(andalsounwelcomeinitseffect),doesnot pollution etc.). local community(e.g.-environment, responsibility totheSocietyand to theshareholdersandSocial employees, Socialresponsibility Social responsibilitytotheirown responsibility totheconsumer, four identifiedareas:Social social obligationsinthefollowing the companieshavefulfilledtheir in termsofthedegreetowhich corporate sectorcanbeanalysed Public Accountabilityofthe Social Responsbility ofEnterprisesneed forSocialAudit 69

ARTICLE ARTICLE strike in Jamshedpur over an industrial dispute for more than the idealLabour-management relations.“Therehasbeenno Rs.10 Croresannually.Thecommittee wasalsoimpressedby markets, playgrounds and clubs for which, the company spends local communityinprovidinghousing, roads,schools,hospitals, highly impressed by the good work done by the company to the rated intermsquality,safety, andprice.Thecommitteewas consumers, says the Report .The products of TISCO are highly in country “The Company has fulfilled its obligations” to the other benefitsofferedtotheemployeeswereperhaps,best shares oftheCompany.TheCompany’swagestructure and with allnecessaryinformationandopportunitiesasregards always receivedtheirdividendsontimeandhavebeenprovided Company had shown laxity. The shareholders of TISCO have some extent,environmentalandworkplacepollutionwhere the the consumersandlocalcommunityingeneralexcept to fulfilled theirsocialobligationstotheshareholders,employees, to thebestinwest.AccordingReport,TISCO has commendable workandthereportingstandardwascomparable handicaps and lack of literature on the subject the committee did its kindwhichwasnotknownbefore.Notwithstandingtheinitial mark in thehistoryof Indian Industry.It was thefirstreports of Report submitted by the expert committee in July 1980 is a land shareholders, society and the local community. The social Audit and moralresponsibilities to the consumers, employees, in Clause 3Aof its Articles ofAssociationregarding its social extent towhichthecompanyhasfulfilledobjectivecontained the Committeeweretoexamineandreportwhether, Sciences, Ahmedabad as members. The terms of reference of P.G. Mavlankar,DirectorofHaroldLaskiInstitutePolitical Centre forthestudyofDevelopingSocieties,DelhiandProf. High CourtasChairman,Prof.RajniKothari-,Directorofthe consisting ofJusticeS.PKotval,retiredChiefBombay By aresolutionin1979,,socialAuditteamwasappointed ,society andthelocalcommunity.” responsibilities totheconsumer,employees,shareholders follows:- “TheCompanyshallbemindfulofitssocialandmoral Association andaddedanewclause3Awhichreadsas in Industry.In1979,theTISCOamendedtheirArticlesof adopted theconceptofSocialAuditfaraheadotherleaders characteristic style of enlightened business management, Bodies, Tata Iron andSteel Company(TISCO), intheir with the concept of Social responsibilities of the Corporate While theindustrializednationsofwestwerestillgroping INDIAN EXPERIENCE Social Responsbility ofEnterprisesneed forSocialAudit 70 performance anditscostbenefitratio. maintain acontinuing study andassessment of social air. Weshall,inkeepingwiththecommittee’srecommendations, from the discharge of any objectionable matter of gas into the all moderndesignfeaturesanddevicestomakeitvirtuallyfree Melting ShopNo.2willinclude,atacostofsomeRs.10crores, Modernization Programme in replacement of the old Steel the shareholdersthatnewshopweshallbuildaspartofour Jamshedpur liesintheSteelMeltingShops.Iamgladtoinform announced “oneofthemajorsourcessuchairpollutionsat Presented in 1980. On August 1980, The Chairman of TISCO monoxide” TISCO fully accepted the Social Audit Report different typesofnoxiousgasesincludingthedeadlycarbon the plants“chargedwithparticlesofcoalandpossiblyiron concern abouttheatmosphericpollutioncausedbysmokefrom after everytwohoursofwork.TheAuditcommitteeexpressed advising workersoftheplanttotakefreshairforhalfanhour condition inthesilteringplantanddisappearanceofNotice However theCommitteewascriticalofinternalworking fifty years”. development. can playavitalroleinthe socialandcommunitysector at largeinthesocialandcommunity fieldandthecompanies the social activities under taken by them for the benefit of public make thecompanies’management statutorilyliabletobringout the report.Thisprovisionin the CompaniesActof2013,will (profit and loss account and balance sheet) as an attachment to together withtheReportofAuditors’onauditedaccounts general meeting(A.G.M)alongwithCompany’sAnnualReport report should be presented to the shareholders in its annual Secretarial auditor (practicing Company Secretary), whose of theCompanyissubjecttoaSecretarialAuditReportby a performance andsocialcommunitywelfare.Thisactivityreport regarding theactivitiesundertakenbytheminareaofsocial mention intheannualreportofcompanyaspecific the newCompaniesActof2013andmadeitmandatory to incorporated bothintheearlierCompaniesActof1956and in here that the Ministry of Corporate Affairs have amended and provision intheArticlesofAssociation. It may be pointedout responsibilities. Oneobstaclemaybe,absenceofanysuch the extenttowhichacompanyhasfulfilleditssocialandmoral has comeforwardtointroducesocialauditwhichonlycanjudge TISCO hasshowntheway.Unfortunatelynoothercompany CONCLUSION DECEMBER 2016 I CHARTERED SECRETARY CS CHARTERED SECRETARY I DECEMBER 2016 71 70 DECEMBER 2016 I CHARTERED SECRETARY * [email protected] Jaipur Chartered Accountants Agarwal Sanjiv&Company Partner Managing Dr. SanjivAgarwal*,FCS Levy ofGSTonE-Commerce & Aggregators ICSI. Also ACIS(UK).FormerChairman,NIRC of CHARTERED SECRETARY I DECEMBER 2016 C or markwithwithout anyindicationoftheidentity ofthatperson. for communication. There mustalsoexistacommunicationdevicebetweenaggregator andserviceproviders manage awebbasedsoftwareapplication. Blabla car,Tripdaetc.Theaggregatorswouldincludeonlineservice providersthatownand Examples oftheaggregatorsincludeUber,Olacabs,Airbnb, Expedia, Groupon, (d) (c) (b) (a) Aggregator shouldbeaperson(asdefinedinsection43B(a)ofmodelGSTlaw. An ‘aggregator’shouldsatisfythefollowingconditions– particular kindunderthebrandnameortradeofsaidaggregator. device, enablesapotentialcustomertoconnectwiththepersonsprovidingserviceof manages anelectronicplatformandbymeansoftheapplicationacommunication As persection43B(a)ofthemodelGSTlaw,‘aggregator’meansaperson,whoownsand Meaning of‘Aggregator’ connection, in the logo, label,signature,whichis usedforthepurposeofindicating,orsoastoindicatea is tosay,anameormark,such asaninventedwordorwriting,asymbol,monogram, name ortradename’meansa brand nameoratradename,whetherregisterednot,that ‘Brand nameortradename’is defined in clause (b) of section 43B. Accordingly, ‘brand Brand NameorTrade ame and to deductanddepositapercentage of taxesfromthecollectionpayabletosuppliers. information to the government regarding the details of supplies made by the actual suppliers the servicesrenderedinrelationtosuchsupplies.Theirobligationisrestrictedprovide supplies madebyactualsuppliersthroughthemexceptfortheliabilitytodischargetaxon In caseofe-commerceoperators,notaxliabilityhasbeenimposedupontheminrespect there willbedevelopmentofseamlessnationalsupplychain. Many producers, sellers and consumers will have easy access to an all-India market as movement ofgoodsacrossthecountry. place may reduce the tax burden, inventory cost and logistical issues, and ensure seamless in the state where the delivery happens. In the long-run the creation of a unified market implementation ofGST,itwillbecomesimple.Sellersone-commercehavetopaytax paid tothecentrewhileVAThasberemittedstategovernments.After and statestaxthesalesofgoods.Thereforeservicetax,CSTcustomsdutyhavetobe value-added tax(VAT)andcustomsduty.Atpresentthecentretaxessaleofservices highlighted inthis Article. Tax atSourceandtakingcreditthereofhavebeenprovided provisions regardingtheirliabilityofcollectionanddeposit and “Electronic commerceoperator” havebeenintroduced. Various Under theprovisionsofModelGST ACT, termslike “aggregator” Services shouldbeprovidedunderthebrandnameortrade oftheaggregator. (say, mobile) Such connecting shall be by means of the web application and a communication device particular kind(say,carrentals). It should enable a potential customer to connect with persons providing service of a Aggregator shouldownandmanageanelectronicplatform. companies facefive indirect taxes including service tax, central sales tax (CST), E-commerce includingaggregatorsinsection43Band43C.Presently,e-commerce hapter XIBofModelGSTActcontainsprovisionsinrelationtotaxation PART-2 :ARTICLE onGST course of trade, between a service and some other person using the name 71

ARTICLE ARTICLE (d) (c) (b) (a) be coveredunderthemeaningandscopeofelectroniccommerce: To understande-commerce,followingaretheessentialfeaturesto services isdonebytheoperator. online andwhetherornottheultimatedeliveryofgoodsand/or Data Interchange(EDI),whetherornot the payment isconducted Integration (UDDI),FileTransferProtocol(FTP),andElectronic shopping carts,Webservices,UniversalDescription,Discoveryand rely ontheinternet,likebutnotlimitedtoe-mail,instantmessaging, network, primarilytheinternet,byusinganyofapplicationsthat / orservices,transmittingoffundsdata,overanelectronic ‘electronic commerce’shallmeanthesupplyorreceiptofgoodsand According to clause (d) of section 43B of the model GST law, Meaning andscopeofelectroniccommerce(e-commerce) taxed asanormalsupplierandTCSwillnotbeapplicable. not be treated as e-commerce operator for such supply. They will be engaged insupplyofgoodsorservicestheirownbrand,theywill or servicesontheirownbehalf.Wheree-commerceoperatorsare aggregator anddonotincludepersonsengagedinsupplyofgoods It may be noted that E-commerce operators are different from provided byhotels,airlinesetc. it willbetreatedasbrandedservices.Examplescouldservices operator provides service under its own brand name or trade name, services mayornotberegistered.Ifanelectroniccommerce aggregators). Thebrandnameortradeofsuchbranded Branded servicesareprovidedbye-commerceoperator(andnot whether registeredornot. commerce operatorunderitsownbrandnameortradename, Services’ meansserviceswhicharesuppliedbyanelectronic In termsofclause(c)section43BmodelGSTlaw,‘branded Branded Services (iii) (ii) (i) which is- (vi) (v) (iv) (iii) monogram, (ii) (i) can beanameormarksuchas– Brand nameortrade(likeola,uber,taxiforsureandsoon) Levy ofGSTonE-Commerce&Aggregat 72 indication ofidentifythatperson. in course of trade and such connection is with or without a connectionbetweenservice and person using name or mark used forthepurposeofindicatingorindicateaconnection registered orotherwise signature, label, or logo, a symbol, invented wordorwriting. It mayornotinvolveconduct ofpaymentonline (viii) (vii) (vi) (v) (iv) (iii) (ii) (i) e-mail internet [notlimitedto]likeanyofthefollowing– Such networkshoulduseanyapplicationthatreliesonthe (primarily internet) Such supplyortransmissionshallbeoveranelectronicnetwork (iii) (ii) (i) It shouldinvolve– electronic datainterchange(EDI) discovery andintegration(UDDI) universal description web services shopping carts instant messaging transmitting ofdata transmitting offunds,or supply orreceiptofgoods/services, file transferprotocol(FTP) ors business modelsundere-commerce. them is made by e-commerce operator. There are different orders inturnmaybesuppliedbydifferentsuppliersandpaymentto platforms andthesealsoreceivethepayment.Such etc. Theordersforgoodsandservicesarebookedonsuch Examples ofe-commerce operators areAmazon,Flipkart or Paytm (d) (c) (b) (a) E-commerce operatorsshould: goods and/orservicestosupplytheirservices. manages anelectronicplatform,whichfacilitatesthesuppliersof operator isapersonwhodirectlyorindirectly,owns,operates As persection43B(e)ofthemodelGSTlaw,ane-commerce Meaning ofElectronicCommerceOperator (h) (g) (f) (e) (d) (c) (b) (a) transactions carriedout Following transactions/eventstakeplacegenerally,whena Transactions carriedoutbyane-commerceoperator (e) operator isrequired to deduct tax (GST) i.e. collect anamount According to section43Cof the model GST law, everye-commerce Collection ofTaxatSource i.e. goodsandservicesbeingsupplied areownedbysuchoperators. engaged insupplyofgoodsand or of themodelGSTlawspecificallyexcludespersonswho are The definitionofe-commerceoperatorinclause(e)section 43B (iv) (iii) (ii) (i) shall bemandatoryirrespectiveofthresholdexemption- In following cases (section 19, Schedule-III), registration under GST aggregator. obtaining registrationismandatoryfore-commerceoperatorand an exemption of Rs. 9 lakh or Rs. 18 lakh will not apply to them. Thus, name ortradeshallberequiredtoregistered.Threshold operator andanaggregatorwhosuppliesservicesunderhisbrand purpose ofregistrationunderGST,everyelectroniccommerce III stipulatethatirrespectiveoftheaggregatethresholdlimitfor Section 19ofthemodelGSTlawreadwithclause5itsSchedule- Registration equirements

provide servicestoothersoronbehalfof connection withelectronicplatform provide anyinformationorotherservicesincidentaltoin facilitate thesupplyofgoodsand/orservices, own, operateormanageanyelectronicplatform E-commerce operator settles the vendors payment periodically. e-commerce operator The vendorconcernedsuppliestocustomerandinforms order E-commerce operatorinformstherespectivevendorof options Customer paystoe-commerceoperatorbyoneofthepayment e-commerce forsupplytocustomer. Customer choosesthevariousvendorsregisteredwith e-commerce operator Customer choosesthe product andpriceterms of Customer visitsthee-commerceplatformwithhisrequirement. operator aredisplayedonhiselectronicplatform. Various productsandservicesavailablewithe-commerce services bytheecommerceoperator. It mayornotresultinultimatedeliveryofgoods/ or tradename. aggregator providing branded services under his brand name every electroniccommerceoperator; services, throughe-commerceoperator; person supplyinggoods and / orservices, other thanbranded person makinginter-statesupplies; DECEMBER 2016 by ane-commerceoperators: I CHARTERED SECRETARY services on their own behalf,

CHARTERED SECRETARY I DECEMBER 2016 73 72 DECEMBER 2016 I CHARTERED SECRETARY supplier shall claimcreditinhiselectronic cash ledger. supplier payment of tax on behalfof the concerned supplierandthe Government bye-commerce operator shallbedeemedto be a to thecreditofappropriate paid and collected Any amount and thedetailsofsuchsupplies duringthesaidcalendarmonth. supplies ofgoodsand/orservices effectedthroughtheoperator amount collected on behalf of each supplier in respect of all The statement filed by operator shall contain the details of the e-commerce operatorontheirbehalf. by deposited with anamount be credited will such supplier by thesupplier,electroniccashledgerof details declared with the On itsmatching bysuchsupplier. returns furnished e-commerce operatorwillbematchedwiththeperiodical details ofsupplies,deductionsanddepositfurnished by credit of such amountintheirelectroniccashledger.The to claim be eligible by e-commerceoperatorwill deposited services onwhosebehalfthepaymentofTCSiscollected and of goods and to section43C(6),thesuppliers According Taking creditofTCS month. month foranycalendar within 10daysofthefollowing made usinghisportalandfurnishsuchstatement supplies collected byhimfromthepaymentsmadeforoutward amounts a statementofall to furnish the obligation also collecting anddepositingtax by 10th of following month, has Under section 43C(4), the e-commerce operator besides Filing ofreturninrelationtoTCS ofGST Government ontherecommendation Council. The rateofTCSshallbenotifiedbytheCentralorState operator. Government bythee-commerce to thecreditofappropriate be paid TCS amountshall is made. Such after theendofmonthinwhichcollection i.e., withinten days which theamountofTCSwassocollected month in by 10thdayofthefollowing operator e-commerce by the to bedeposited TCS isrequired 43C(3), As persection of goodsand/ or servicesmadethroughit. towards thesupply consideration to thesupplier,representing or paid from theamountpayable Such taxhastobecollected (b) (a) to becollectedonearlierofthefollowingtwoevents using e-commerceoperator’splatform.Suchamountisrequired goods andservices,whohadsuppliedsuchservices deduction) tax from the payment to be made to the suppliers of An e-commerceoperatorisrequiredtocollect(bywayof and DepositofTCS Collection operator. reflected inthestatement/returnfiledbye-commerce as perentries cash ledger, his electronic credit in claim payment of tax onbehalfof the supplierandshall deposited withthe Government shall bedeemedto be the and from thesupplier TCS collected In termsofsection43C(5), at alaterstage. reconciliation to subject be will which to vendors on payment collected to be have services. Thistaxwill and goods of theirown supply of in thestatesrespect GST ispayable to what addition in E-commerce operatorswillhave to collecttax at source(TCS) source (TCS), similar totaxdeductedatsource(TDS). operator. Thetax so deductedisknownastax collected at or services usingthe electronic platformof such e-commerce and /suchgoods or services,whohavesupplied of goods called TCSfromthepaymentstobemadesupplier time ofpayment amount tosuchsuppliers of goodsand/ or services time ofcreditamounttotheaccountsactualsupplier CHARTERED SECRETARY I DECEMBER 2016

thousand forsuch failure. whichmay extenduptorupeestwentyfive to penalty i.e. liable GST law, 66 ofthemodel section attract actionunder so shall working daysfromthedateof serviceofnotice.Failuretodo an obligationto furnish therequired informationwithinfive shall beunder The operatoronreceiptofnotice asaforesaid (b) (a) under themodelGSTdetails– law tofurnishthefollowing way ofnoticeinwriting,beforeorduringanyproceedings of the rank of Joint Commissioneror above may require, by tax authority 43C, any of section (10) In termsofsub-section Information tobeSubmitted Additional made bytheactualsuppliersusingportalof operator. sought bytheGovernmentrelatingtodetailsofsupplies relates. Theoperatorisresponsibletoprovidetheinformation 10 daysaftertheendofmonthtowhichsuchcollection respective Statementcontainingthedetailsofsuchcollectionis the collectedamountonbehalfofsuppliersandtofile respective details.Thetimeavailabletotheoperatordeposit amount tothegovernmentandfileastatementcontaining out oftheproceedspayabletoactualsuppliers,paysuch responsible tocollect/deductthespecifiedpercentageofamount According tosection43ofmodelGSTlaw,theoperatoris of e-commerceoperatorforTCS Responsibilities communicated. is month inwhichthediscrepancy the calendar succeeding output liabilityof the saidsupplierfor the calendar month to the be added shall iscommunicated discrepancy which return forthemonthin in hisvalid rectified bythesupplier which anydiscrepancyiscommunicatedandnot to anypaymentinrespect of The valueofsupplyrelating - asmaybespecifiedinthenotice. places ofbusinessbysuchsuppliers as additional declared by suchoperatorsand whatever namecalled,managed by through suchoperatorinthegodownsorwarehouses, supplies making by thesuppliers held stock ofgoods operator duringanyperiod,or such and/or serviceseffectedthrough of goods supplies Levy ofGSTonE-Commerce&Aggregat

73 ors CS

ARTICLE 74 DECEMBER 2016 I CHARTERED SECRETARY 3 Legal World

n MORGAN STANLEY MUTUAL FUND v. KARTICK DAS [SC] n PRESIDENT/SECRETARY J.K. SYNTHETICS MAZDOOR UNION (CITU), KOTA v. ARFAT PETROCHEMICALS PVT.LTD & ORS [SC] n UCO BANK & ANR v. DIPAK DEBBARMA & ORS [SC] n ROTOMAC ELECTRICALS LTD v. UNION OF INDIA & ANR [Del] n IDBI TRUSTEESHIP SERVICES LTD v. HUBTOWN LTD [SC] n STATE OF U.P. & ORS v. ALL U.P. CONSUMER PROTECTION BAR ASSOCIATION [SC] n JINDAL STAINLESS LTD & ANR v. STATE OF HARYANA & ORS [SC] n COMMISSIONER OF COMMERCIAL TAX & ORS v. BAJAJ AUTO LTD & ANR [SC] n GLOBE GROUND INDIA EMPLOYEES UNION v. LUFTHANSA GERMAN AIRLINES & ORS [DEL]

CHARTERED SECRETARY I DECEMBER 2016 75 Legal World broadly private useorConsumption.Themeaningoftheword‘consumer’ is the definition,consumerisonewhopurchasesgoods for The consumerasthetermimpliesisonewhoconsumes.As per Reason: Decision: Appealallowed. come tobepreferred. by thisorder,civilappealarising out of SLP (C) No.272of1994has appellant toraisefundsfromthepubliconscheme.Aggrieved public. The consumerforum passedandinterim orderrestraining the unfair. The appellant was seeking to collect money by misleading the irregularities in the same. Thebasisofallotmentisarbitraryand Offering CircularwasnotapprovedbytheSEBI.Thereareseveral floated. The principal grounds taken were that the appellant’s Redressal Forum seeking to restrain the public issue from being The respondentmovedtheCalcuttaDistrictConsumerDisputes public toitsmutualfundscheme“MorganStanleyGrowthFund”. The appellantmadeapublicissueinvitingsubscriptionfromthe the SupremeCourtofIndia. complaint”. We are concerned with this aspect of law laid down by debentures/ units etc., become ‘goods’ so as to maintain a consumer or otherwiseofthedecisionHighCourt,was“Whenshares/ crucial andinteresting question whicharose, to decidethe correctness practice with respect to the issue of shares/debentures/ units etc., the Though thiscaserelatetoconsumerprotectionquaunfairtrade Brief facts: shares beforeallotmentisgoods-Held,No. Consumer protectionAct,1985readwithSaleofGods1930-goods-whether (1994) 81CompCAS318. Equivalent citations:1994SCC(4)225;JT(3)654;SCALE(2)1121; M.N.Venkatachalliah, A.S.Anand&S.Mohan,JJ.[Decidedon20/05/1994] Civil appealNo.4584of1994(arisingoutSLP(C)No.2721994) MORGAN STANLEY MUTUALFUNDv. KARTICKDAS[SC] CS:LMJ: 14:12:2016 76 The consumes goodsorservicesat theendofchainproduction. producer, supplier, wholesalerandretailer. and industrial activity. He needs protection from the manufacturer, every society,consumerremains thecentreofgravityallbusiness deserves togetwhathepaysfor inrealquantityandtruequality.In money as the price or cost of goods and services. The consumer comprehensive stated in the definition above definition aims at covering Corporate so as to every include Laws man anyone who pays who consists of thewordownershare.Buttitletogetonregister register, and only a person who is on the register is in the full sense “The Companyisentitledtodealwiththeshareholderwhoon was observedthus: Pestonji Bharucliav.WadilalSarabhai&Co.AIR1926PC38.It As to the scope of this clause, reference may be made to Maneckji or acquiredbytheselleraftermakingofcontractsale.” “(6) ‘future goods’means goods to be manufacturedorproduced Act, 1930.Thatreads: It willbeusefultoreferclause(6)ofSection2theSaleGoods are agreedtobeseveredbeforesaleorunderthecontractofsale.” crops, grass, and things attached to or forming part of the land which shares,growing and actionable claimsandmoney;includesstock “(7) ‘goods’meanseverykindofmovablepropertyotherthan goods sinceSection2(7)of the SaleofGoods Act, 1930isasunder: actionable they canneverbecalledgoods.UndertheSaleofGoodsAct,all allotment of shares takes place, “the shares do not exist”. Therefore, which anapplicationismadeforallotmentwouldbe‘goods’.Tillthe In thelightofthis,wewillhavetoexaminewhether‘shares’for prospective investorcouldfallunder theAct. (d) be atransaction of buying goodsfor consideration underSection 2(1) the signed by the registered holder. This-is what Bharuchahad. He had to of a completed transaction of a sale and purchase. If regard is had requirement services ofthecompanyforaconsideration.Inordertosatisfy the goods for a consideration nor again could he be called the hirer of the The issue was yet to open on 27-4-1993. There is no purchase of At thatstage,heisonlyaprospectiveinvestor(sicin)futuregoods. (Article of Association of Company). But certainly not before allotment. Therefore, itisafterallotment,rightsmayariseasperthecontract contract evidencedbythearticlesofassociationCompany.” by asumofmoneyandmadeupdiverserightscontainedin the “A shareisnotasumofmoney;itrepresentsaninterestmeasured this Courtobserved: Standard applicant forsuchsharescouldbecalledaconsumer?InCITv. goods. Inotherwords,beforeallotmentofshareswhetherthe A fortiori,anapplicationforallotmentofsharescannotconstitute allotment differentconsiderationsmayprevail. Therefore, atthestageofapplicationitwillnotbegoods.After passes fromthesellertobuyer.” shares ofjointstockcompanies)takesplacewhentheproperty “A sale accordingto the Sale of GoodsAct(andinIndia goods include AIR 1950FC21itwasheldthus: not suggested thatabrokerwhosoldsharesbygeneraldescriptiondid It wouldbeanupsetofallStockExchangetransactionsifitwere Again shares inIndia.” equitable considerationsnotapplicabletogoodsdoapply shares, but alsothis class of choses in action,are goods. Hence every kindofmoveablepropertyitisclearthatnotonlyregistered Act, delivered chosesinaction.ButIndia,bythetermsof the Contract He sold what in England would have been choses in action, and he described. Bharuchasoldwhathehadgot.Hecouldsellnomore. and blanktransfers,signedbytheregisteredholdersofshares the (i) certificates implement these of in definition the Madholal in Vacuum choses claims the said of

above his and possession of Act. bargain Sindhu in Oil and blank complaint DECEMBER 2016 action definition The Co. money

transfers, of definition AIR by are of Bombay supplying under 1966 of a are goods. certificate consumer,

signed excluded contemplates SC I the CHARTERED SECRETARY v. By Official the 1393 Act, the by buyer together it

the it is while from definition Assignee will clear registered with the be the defining with that pre-existence the

clear definition of of there a certificate goods Bombay holders. transfer shares, that must no as of

CHARTERED SECRETARY I DECEMBER 2016 77 76 DECEMBER 2016 I CHARTERED SECRETARY is Having regard to the frivolous nature of the complaint, we think it seem readilytooblige.Wethinksuchatendencyshouldbecurbed. speculative andvexatiouslitigationadventurismwhichthefora There is an increasingtendency on the part of litigants to indulgein association isnotaconsumerundertheAct. our answeristhataprospectiveinvestor like the respondent or the allotment ofsharesdoesnotbringintoexistence.Therefore, relating tothecarryingofanytrade.Creationsharecapitalwithout making arrangementsforcarryingonthetrade.Itisnotapractice of issuing the same is for building up capital. To raise capital, means trading inshares.Thesharemeansathecapital.object Act, 1969.Thatagaincannotapplybecausethecompanyisnot under Section 36-A of Monopolies and Restrictive Trade Practices trade any unfairtradepracticehasbeenadopted.Theexpression‘unfair arise inthis case. Therefore, what requires to beexaminedis, whether Certainly, clauses(iii)and(iv)ofSection2(1)(c)theActdonot this Act.” such goods, with a view to obtaining any relief provided by or under being inforceordisplayedonthegoodsanypackagecontaining of suffered heavily.Therefore,weawardcostsofRs25,000infavour definition What isthathecouldcomplainofundertheAct?Thistakesusto sold toRespondent No.1foratotalconsideration ofRs.15crores. MoU the assets of the Kota Units of Respondent No. 2 were to be Pvt. Ltd.(APPL),theFirstRespondent herein.Accordingtothesaid Memorandum ofUnderstanding(MoU) withM/sArafatPetrochemicals In themeanwhile,Second Respondententeredintoa units wasaccepted. the RehabilitationSchemerecommending thede-mergerofcement Second Respondent was declared a sick industrial company and J.K. Synthetics Limited (now Jay Kay Enterprises Ltd.), who is the Brief facts: No. purchaser-Held, the to directions issues BIFR whether company- SICA, 1985-saleofunitbysickcompanytopurchaser- purchaserisnotasick Anil R.Dave&L.NageswaraRao,JJ.[Decidedon18/11/2016] No. 8599of2010. Civil Appeal No. 8597 of 2010 & Civil Appeal No. 8598 of 2010 with Civil Appeal [SC] (CITU), KOTA v. ARFAT PETROCHEMICALSPVT.LTD &ORS PRESIDENT/SECRETARY J.K.SYNTHETICSMAZDOORUNION LW: 74:12:2016 accordingly. No. 4584of1994arisingoutSLP(C)272isallowed a (iv) atraderhaschargedforthegoodsmentionedincomplaint in anyrespect; (iii) defects; (ii) the goods mentioned in the complaint suffer from one or more by anytrader,thecomplainanthassufferedlossordamage; complainant that- (i) as a result of any unfair trade practice adopted “2. (1)(c)‘complaint’meansanyallegationinwritingmadebya price the a the fit practice’ CHARTERED SECRETARY appellant. case in services of excess complaint for as award It mentioned per of shall the rules under be of price costs, recovered shall in Section I fixed DECEMBER 2016 the have more complaint by 2(1) from the or so, under (c) same the when which suffer first any meaning the respondent. reads law from appellant for as as deficiency the follows: defined C.A. time has judgment No. 8599of2010isfiledbyJKSyntheticsLimitedaggrievedthe not challengedintheWritPetition. dated the FirstRespondentnottoalienate/transferassetsbyitsorders BIFR wasnotcorrectinpassinganorderofstatusquoanddirecting industrial companyinaccordancewiththeSanctionedScheme. The sick industrial company and that it purchased the assets from a sick company. ThereisnodisputethattheFirstRespondentnot a can issue a direction not to dispose of assets only to a sick industrial It isclearfromaplainreadingofSection22 A oftheActthat the Board the scopeofSection22AAct. The onlypointthatfallsforconsiderationintheseAppealsisregarding Reason: the companyallowed. Decision: Appealsofthetradeuniondismissedandappeal Unions Being aggrievedbythesaidjudgmentofHighCourt,Labour which is not a sick industrial company under Section 22 A of the Act. the AAIFR do not have jurisdiction to issue directions to a company High Court allowed the Writ Petition by holding that the BIFR and filed The AAIFRbyitsorderdated11.12.2008dismissedtheAppeals assailed bytheFirstand Second RespondentsbeforetheAAIFR. The ordersdated05.05.2008and30.06.2008oftheBIFRwere First Respondentwasnotrightincontendingso. no directions can therefore be issued to it. The BIFR held that the by theBIFRandinformedthatitisnotasickcompany The FirstRespondentparticipatedinthenextreviewmeetingheld of the Kota unit on the ground that there is change in management. Respondent cannot escape responsibility towards the rehabilitation thattheSecond held BIFRalso The of2005. Scheme the Sanctioned interest oftheworkmenhavetobesafeguardedinaccordancewith the that held BIFR The Respondent. First the by waste/scrap as units the complaints that were made regarding the sale of assets of the Kota units. In the review meeting held on 05.05.2008, the BIFR took note of in favouroftheFirstRespondentforsaleassetsKota Respondent Second bythe executed was deed asale On 24.03.2008 19.10.2001. of theKotaunitstoFirstRespondentintermsMoUdated APPL. on07.01.2005,theAAIFRsanctionedaSchemefortransfer The liability towards payment to the workmen was to be borne by period specifiedinClause(a)and (b).” sick industrialcompanyfromdisposing ofitsassetsonlyduringthe confers a limited power on the Board to pass an order prohibiting a “It runscountertotheexpressterms ofSection22AtheActwhich reported in(1995)4SCC276wherein itwasheldasfollows: Ltd. v.U.P.StateSugarCorporation KaramchariAssociation&Anr this viewbyajudgmentofCourt inU.P.StateSugarCorporation industrial competence toissuedirectionsacompanywhichisnot sick High Courtin the impugned judgmentthatthe BIFR doesnothave Respondent Aggrieved bytheorderdated11.12.2008ofAAIFR,First was rejected. BIFR hasnojurisdiction overacompanywhichisnot asickcompany of theKotaunits.ThecontentionFirstRespondentthat and reviewtheeffortsmadebyFirstRespondenttowardsrevival The BIFR was also directed to continue the monitoring of the Scheme the exactpositionrelatingtopaymentofduesworkmen. by 05.05.2008 filed the company in First so Civil filed far Respondent Appeal a and as under Writ it 30.06.2008. set Petition No. Section aside 8597 and the in 22 directed We and findings the A agree of Rajasthan 8598 the the in with Act. of its BIFR 2010. favour the We High to findings are Civil re-examine which Court. fortified 77 Appeal of were The the in

Legal World Legal World conclusion that the HighCourt was wholly incorrect inanswering the It will not require much appreciation or scrutiny to come the Reason: Decision: Appealallowed. that of Scheduled Tribe(s) of the State of Tripura. They had contended The writpetitioners,whoaretherespondentsherein,members Court. High Gauhati ofthe Bench Agartala the before instituted The writpetitionoutofwhichtheseappealshavearisenwas facts: Brief by thebank–whetherprohibitedprovisionsofTripura Act-Held,No. 1960- enforcementofsecurityinterest-salemortgagedassetstheborrower SARFAESI Act,2002readwithTripura LandRevenueand landReformAct, Ranjan Gogoi&AbhayManoharSapre,JJ.[Decidedon25/11/2016] CivilAppealNo.11250of2016(arisingoutS.L.P.With (C)No.33671of2016) Civil AppealNo.11247of2016(arisingoutS.L.P. (C)No.36973of2012) UCO BANK&ANRv. DIPAK DEBBARMA&ORS[SC] LW: 75:12:2016 Respondent Respondent. no liabilityinrespectofKotaunitswhichhavebeensoldtotheFirst As statedsupra,theAAIFRheldthatSecondRespondenthas Sanctioned Schemeandpasssuitabledirections. of the Act. It is open to the BIFR to review the implementation of the express noopiniononthejurisdictionofBIFRunderotherprovisions are notrelevantforadjudicationofthedisputeintheseappeals.We of hearingtheseAppealswhichwehavenotadvertedtoasthey bybothsidesduringthecourse Several contentionshavebeenraised 78 to 31-B oftheConstitution,wouldprevailoverAct2002so as the Constitutionand,therefore,enjoyingprotectionofSection the TripuraActof1960beingincludedinNinthSchedule to in favour of the respondents/writ petitioners on the ground that The High Court by the impugned order answered the writ petition scheduled tribe. case happenedtobethepersonswhoarenotmembersof any member of a scheduled tribe. The auction purchasers in the present of mortgagedpropertiesbythebanktoanypersonwhoisnot a under the Tripura Act there is a legislative embargo on the sale Act, 1960(hereinafterreferredtoasthe“TripuraActof1960”) Reforms Land and Revenue Land Tripura ofthe 187 of Section 2002 (hereinafterreferredtoasthe“Actof2002”)wasininfraction of Financial Assets and Enforcement of Security Interest Act, Bank undertheprovisionsofSecuritisationandReconstruction are dismissed.CivilAppealNo.8599of2010isallowed.Nocosts. For theaforesaidreasons,CivilAppealNos.8597and8598of2010 in theWritPetitionfiledbyFirstRespondent. in favour of the Second Respondent as they were not in challenge clarification findings set asidetheentire order dated11.12.2008without taking note of the contrary to the provisions of Section 187 of the Tripura Act of 1960. High invalidate the Court. Sale in favour The by in the Notification The the the sale High of Writ said Second the Notification Court Petition findings Second dated Respondent ought filed 26.06.2012 dated were Respondent. not in the to not 26.06.2012, have was High challenged issued also disturbed Court. The dismissed by petition the The the by same the High appellant the findings filed by being Court First the for

writ the State Actdealingwithlandreformintoanareaofbankingcoveredby is onaccountofanapparentoversteppingbytheprovisions measures consolidate the land revenue law in the State and also to provide The object of the State Act, as already noted, is anattempt to bank is an inseparable and integral part of the business of banking. in ListIoftheSeventhSchedule.Salemortgagedpropertybya The Act of 2002 is relatable to the Entry of banking which is included by theActof2002forrealisationamountsduetobank. of ascheduledtribe.Thisisclearrestrictiononwhatpermitted by a member of a scheduled tribe to any person other than a member the bank from transferring the property which has been mortgaged Section 187 of the Tripura Act of 1960, on the other hand, prohibits prescribed. the propertysold,subjecttocompliancewithrequirements its dues.Thepurchaserofsuchpropertyacquiresacleartitleto take possessionofandsellsuchpropertytoanypersonrealise favour. of anypropertywhereasecurityinteresthasbeencreatedinits The provisionsof the Act of 2002enablethe bankto take possession is the dominant legislationhavingregard the area of encroachment. In did notproceedontheaforesaidbasis. notwithstanding thefactthatproceedingsbeforeHighCourt This isaquestion,therefore,thatthisCourtwillhavetodealwith being overriddenby the provisions of a Parliamentary statute. would, therefore,notconferimmunitytothesaidlegislationfrom Inclusion of the Tripura Act of 1960 in the Ninth Schedule by itself, that itviolatesanyoftheprovisionsPartIIIConstitution. protection/immunity toalegislationfromchallengeontheground of thelanguagecontainedtherein,isself-explanatoryandprovides on the above basis. Article 31-B of the Constitution, on the very face in favourofthebankeither theCentralenactments. on the Centralenactmentsnottohave anyoverridingeffect,proceeds judgment of this Court holding the State enactments to be valid and similar/parallel providing Sales Tax Act, 1959 and the Kerala General Sales Tax Act, 1963 & Ors(2009)4SCC94,holdingthattheprovisionsofBombay The decision of this Court in Central Bank of India v. State of Kerala Act of1960. prevail over the provisions contained in Section 187 of the Tripura property canbesoldbythebankforrealisationofitsduesthat will contain any embargo on the category of persons to whom mortgaged would beinvalid.ItistheprovisionsofAct2002,whichdonot the provisionsof the Tripura Act of 1960, pro tanto, (Section 187) way. ThedominantlegislationbeingtheParliamentarylegislation, the extentthatitisinconsistentwithActof2002,mustgive with activitiesrelatingtosaleofsecuredassets,theStatelaw, by enacting such alawtraceable to Entry 45anddealingexclusively 187, operatedvalidly.However,themomentParliamentsteppedin and referabletoEntry45ofListI,theStateAct,includingSection exist anyparallelCentralActdealingwithsaleofsecuredassets the State legislature is in the area of banking. So long there did not specific the Actof2002mustbeunderstoodbynoticingabsence any Financial Institutions, Act 1993 (for short the “DRT Act”) and also provisions contained in the Recovery of Debts Due to Banks and pay sales tax, in favour of the State, is not inconsistent with the the the Central petition present said Specifically, provision for of basis

Act. and agrarian a case provision

first striking The i.e. in the DECEMBER 2016 charge Section absence test, either reforms. conflict

down of therefore, of a on 13

first the of the between The the of any sale charge Central the property would field provision I CHARTERED SECRETARY

2002 Notification the of in enactments be Central encroachment Act favour of to creating the enables find

dated and of person out the a the containing

26.06.2012 as the first bank. State made to liable bank charge which The Act by to to a

CHARTERED SECRETARY I DECEMBER 2016 79 78 DECEMBER 2016 I CHARTERED SECRETARY appellant bills showing authorization No/File No. Further, it is observed that logged byCustoms. They have not been able to produce shipping appeal, it is observed that Part-2 of DEEC Book has been not As of advancelicenceNo.0131276dated22.12.1999. 1992. Onaperusalofthe show cause notices, we found that the not opentotherespondents invoke Section11(2)ofFTDRAct, cause notices beingsilentabout the proposed levy of penalty, it is We powers conferredbySection11(2) ofFTDRAct,1992. ofthe inexercise thepenalty errorinimposing committed any to produce. Therefore, the respondents cannot be said to have the respondentNos.1&2thatappellant/writpetitionerfailed appellant recorded bythestatutoryauthoritiesregardingfailureof the required it isclearthattheappellantdidnothaverequisitedocuments as perPolicy/Procedurebuttheyfailedtodoso.Fromtheabove, They wererepeatedlyadvisedtoprovidethedocumentsrequired evidence personal hearingasdetailedinaboveparastoproducerequisite the case. The appellant was granted various opportunities of I haveexaminedthedocumentsandgonethroughfactsof Reason: Decision: Appealdismissed. imposed. Theappellantchallengedtheimpositionofpenalty. and thepenalproceedingswereinitiatedagainstitpenaltywas issue Board (FOB) value within a period of 18 months from the date of the to completetheexportobligationofRs.1,07,58,600/-asFreeOn required was appellant the licence, ofthe conditions the Asper Act’). Trade (DevelopmentandRegulation)Act,1992(forshort‘FTDR 22.12.1999 underDutyExemptionSchemetheForeign licence dated petitionerwasgrantedanadvance The appellant/writ Brief facts: documents- penaltyimposed-whethertenable-Held,yes. obligations- failuretodischarge–penaltyproceedings-produce Foreign Trade (DevelopmentandRegulation)Act, 1992- advancelicence-export G.Rohini &SangitaDhingraSehgal,JJ.[Decidedon08/11/2016] LPA No.363of2016 [Del] ROTOMAC ELECTRICALSLTD v. UNIONOFINDIA&ANR LW: 76:12:2016 by failed todoso.Fromthedocuments(onlyphotocopies)submitted of of export obligation as required under the terms and conditions could be consideredornot,buttheissuewaswhetherappellant can licence beforethegrantofadvance even place had taken to theinterpretationofclause4.12aswhetherexports that of India. We have observed that the dispute was not with regard Constitution ofthe 226 Article under jurisdiction ofthewrit exercise the exportobligationwarrantsnointerferencebythisCourt in

the the rightly do of CHARTERED SECRETARY produce not advance firm advance to has of to held find prove with fulfilment furnish not any by authenticated their licence. produced licence. that the substance the they letter learned of

documents The A export have Duplicate/Bank dated categorical I DECEMBER 2016 appellant even documents Single fulfilled obligation 03.09.2014 in to the Judge, export failed establish finding contention Certificate to but to prove obligation such and fulfil the was the also finding appellant this the that copy recorded fulfilment obligation in with fulfilment the of respect of BRC. show their has fact by of

the Petitioneris thedebenturetrustee. Amazia and Rubix executed two debenture trust deeds where Rubix TradingPvtLtd(“Rubix”). Securingtheaboveinvestment, (“OPCDs”) issued by Amazia Developers Pvt Ltd (“Amazia”) and this sum in certain optionally partially convertible debentures The valueof this investment isabout Rs.418 crore. Vincainvested referred to as the “CCDs”) of Vinca Developer Pvt Ltd (“Vinca”). shares andcompulsorily convertible debentures (hereinafter equity certain in (“FMO”)invested N.V. Ontwikkelingslanden Nederlandse Financierings-Maatschappijvoor defendant. out ofaCorporateGuaranteeexecutedbytheRespondent- by thePetitioner,adebenturetrustee,toenforcerightsthatarise dismissed. reasons, the appeal is devoid of merit and the same is accordingly none of the Directors approached this Court. For the aforesaid not havebeenmadeliablealsodeservesnoconsiderationsince The contentionthattheDirectorsofappellantcompanyshould case onhand. Limited(2007) 15 SCC 91 are not relevant for adjudicating the 89 and Commissioner of Central Excise v. Gas Authority of India Central Excise, Nagpur v. Ballarpur Industries Ltd. (2007) 8 SCC Engineering India Ltd. (2006) 7 SCC 592; Commissioner of the appellant, i.e., Commissioner of Customs, Mumbai v. Toyo has nofactualbasis.Therefore,thedecisionscitedonbehalfof the show cause notices were silent about the action proposed the advance licence dated 22.12.1999. Hence, the allegation that summary The present appeal arisesout of a Summons forJudgment in a Brief facts: Held, No. guarantor- court allowedunconditional leave to defend–whether correct- suitfiledagainstthe interest- Enforcementofcorporateguarantee-summary Investment indebentures-appointmentofdebenturetrustee-failuretopay Kurian Joseph&R.F.Nariman, JJ.[Decided on15/11/2016] Civil AppealNo.10860of2016(arisingoutSLP(C)No.314392015) IDBI TRUSTEESHIPSERVICESLTD v. HUBTOWNLTD [SC] LW: 77:12:2016 under issued underSection14oftheFTDRActproposingtotakeaction note thattheshowcausenoticedated01.12.2009wasinfact to petitioner wasputonnoticethatitfailedtosubmitthedocuments prove Section the suit fulfilment filed 11(2) on for the of non-fulfilment original export obligation. side of of export the General It Bombay is obligation also Laws High relevant 79 against Court, to

Legal World Legal World suit. Hencetheappeal. guarantee inwhichthecourthasgrantedleavetodefend the BombayHighCourtforenforcementofcorporate uninfluenced by anyobservationsmadebyus herein. within a period of one year from the date of this judgment, We further direct that the suit be tried expeditiously, preferably judgment oftheBombayHigh Courtissetaside. months from today. The appeal is accordingly allowed, and the and SeniorMaster,BombayHigh Courtwithinaperiodofthree amount of Rs.418 crores, to the satisfaction of the Prothonotary of Rs.418croresinvestedbyFMO,orgivessecurityforthesaid suit onlyifitdepositsintheBombayHighCourtprincipalsum In ouropinion,thedefendantwillbegrantedleavetodefend the being thecase,plaintiffneedstobeprotected. to usbeintherealmofbeing‘plausiblebutimprobable’.This stopped beingmadebythem.Thedefencethusraisedappears made by the concerned parties until 2011, after which payments the structured arrangement mentioned above admittedly being submerged inabuildingconstruction project, with payments under a triableissue.Rs.418croreshasbeenstatedtobeutilized and about theDefendant’s good faithandthegenuinenessofsuch the FEMARegulations,nevertheless,weareleftwitharealdoubt even ifatriableissuemaybesaidtoariseontheapplicationof Arguably atthehighest,asheldbylearnedSingleJudge, has raisedasubstantialdefencetotheclaimmadeinsuit. Based on the aforesaid, it cannot be said that the defendant carried out,andnototherwise. 3 SCR 739 would be attracted only if the illegal purpose is fully judgment inImmamiAppaRaov.G.Ramalingamurthi,(1962) then againtherewouldbenoinfractionofFEMARegulations.The permission wouldbenecessary.IfRBIisnotgranted, At the stage that FMO wishes to repatriate such funds, RBI breach ofFEMARegulations. agreements inIndia.Ifthisisso,againprimafaciethereno stage utilise the funds received pursuant to the overall structure Vinca after the requisite time period has elapsed, FMO may at that of theFEMARegulations.SinceFMObecomesa99%holder Indian company,sothatprimafacieagainthereisnoinfraction trustee, anIndiancompany,forandonbehalfofVinca,another invoked. PaymentunderthesaidGuaranteeistodebenture the defendant’s casethat the saidCorporateGuarantee iswrongly which onitstermsisunconditional.Itmaybeaddedthatitnot In corporate guarantee,whichwasalsonotresponded. demand certificatenoticeontheRespondentenforcing notice which was not responded. Therefore, the Petitioner issued redemption issued petitioner the OPCDs, the on interest of Consequent upontheDefaultsbyAmaziaandRubixinpayment The not allegedtobeviolativeoftheFEMAregulations. compulsorily convertibledebentures.Thistransactionbyitselfis the Dutchcompany,toVincaforpurchaseofsharesaswell It is clear that a sum of Rs. 418 crores has been paid by FMO, Reason: Decision: Appealallowed. in an unconditional,absoluteandirrevocablecorporateguarantee under thedebenturetrustdeeds,Respondenthadissued punctual paymentbyAmaziaandRubixofallduestoVinca In ordertosecurethesaidOPCDs,andensuredue 80 favour these suit circumstances is of filed the Petitioner only on the invocation for Petitioner the benefit of filed the of a Corporate Vinca summary ( “Guarantee”). Guarantee suit before creation requirements ofstaff; • • the • the • the • Arijit Pasayat,aformerjudgeofthisCourt,toexamine: the SupremeCourt constituted aCommittee presidedoverbyMrJustice Court inthe course of the proceedings inthis case. On 14January 2016, the ConsumerProtectionAct,1986hasledtoseveraldirectionsofthis administrative conditionsofeligibilityforappointmentnon-judicialmembers; • • Court issuesdirectionstoimprove. Consumer ProtectionAct,1985-deficiencyintheadministrationoflaw-Supreme T.S. Thakur, D.Y. Chandrachud&L.NageswaraRao,JJ.[Decidedon21/11/2016] Civil AppealNo.2740of2007withWritPetition(C)1642002 BAR ASSOCIATION [SC] STATE OFU.P. &ORSv. ALLU.P. CONSUMERPROTECTION LW: 78:12:2016 (iii) TheUnionGovernmentshall whileframingthemodelruleshave Commissions andNationalCommission; the appointmentofmembersrespectively oftheDistrictfora,State to regard 20(1)(b)in Section and 16(1)(b) Section 10(1)(b), Section rules prescribingobjectivenorms forimplementingtheprovisionsof (ii) TheUnionGovernmentshall also framewithinfourmonthsmodel within fourmonthsandshallbesubmitted tothisCourtforitsapproval; adoption bythe state governments.Themodelrulesshallbeframed 16(2) of the Consumer Protection Act, 1986frame model rules for the exerciseof the rule making power underSection10(3)and Section (i) TheUnionGovernmentshallforthepurposeofensuringuniformity in The SupremeCourtissuedthefollowingdirections: Directions: Decision: Directionsissued. service • The Brief facts: officers andmembers; district level; deficiencies ininfrastructureandremedialmeasures; level; the presidingofficersofstateanddistrictfora; level; andotherrelevantissues. deficiency need position infrastructural conditions of for of a separate of infrastructure additional powers vacancies DECEMBER 2016 including requirements cadre which Benches in of of

the have pay members Protection Law staff adjudicatory at I scales CHARTERED SECRETARY been at

the of the

the national, at or national, Consumer governing the should State fora national,

constituted state state be Commissions, the conferred and and state presiding district district

under and on

CHARTERED SECRETARY I DECEMBER 2016 81 80 DECEMBER 2016 I CHARTERED SECRETARY purposes oftheConsumerProtectionAct,1986. explained inthisJudgmenttoeffectivelyimplementtheobjectsand Commissions over the District fora in terms of Section 24(B)(2) as 24(B)(1)(iii) andinrespectoftheadministrativecontrolState the NationalCommissionoverStateCommissionsunderSection in ordertoeffectuatethepowerofadministrativecontrolvested of theCentralGovernmentwithinaperiodthreemonthsfromtoday to formulateregulationsunderSection30Awiththepreviousapproval The NationalConsumerDisputesRedressalCommissionisrequested Section 30oftheConsumerProtectionAct,1986; appropriate rulesintheexerciseofrulemakingpowersunder Governments shallproceed to adoptthe model rules by framing State the Court, this by rules model the of approval the Upon Redressal Commission,withintheperiodstipulatedabove; consultation with the President of the National Consumer Disputes to the natureof adjudicatory duties andthe need to attract suitable talent of servicethemembersconsumerforacommensuratewith provide for the payment of salary, allowances and for the conditions to inthestatutoryprovisionsmentionedabove.Themodelrulesshall by the members of the respective fora in the domain areas referred of theability,knowledgeandexperiencerequiredtobepossessed due regardtotheformulationofobjectivenormsforassessment character of our polity andthe Centre-State relationship inlegislative any pronouncement of this Court is bound to impact the federal the powersofStatelegislatures tolevytaxesbutalsobecause considerable public importance not only because the same deal with decided bymajority.Thequestions assumeinagreatmeasure several Constitution Bench decisions of this Court, all but one, XIII oftheConstitutionwhich have beenthesubjectmatterof touching theinterpretationofArticles301to307comprising Part These appealsbringtoforeforourdeterminationvexedquestions Brief facts: validity thereof-SCanswersthereferenceinaffirmative. Tax levy ofEntry country- byStates- whether impedes the free trade- constitutional 52-articles301-304- freetradethroughoutthe Constitution ofIndia-ListII-entry on 11/11/2016] D.Y.Chandrachud, AshokBushan,R.Banumathi&A.M.Khanwilkar,JJ [Decided T.S. Thakur, A.K. Sikri, S.A. Bobde, Shiva Kirti Singh, N.V. Ramana, Civil AppealNo.3453of2002withbatchappeals [SC] JINDAL STAINLESS LTD &ANRv. STATE OFHARYANA &ORS LW: 79:12:2016 the CHARTERED SECRETARY adjudicating bodies. These I DECEMBER 2016 rules shall be finalized Laws Tax upon due (2) (1) the ConstitutionBenchwereinfollowingwords: Issues: ThequestionsformulatedbytheCourtfordetermination determine thelawrelatingtolevyofentrytax. to havearelookontheissues,questionsraisedanddecide the constitution bench of the Supreme Court (consisting of 9 judges) [1] SCC 673). Therefore, all these matters were ultimately referred to Rajeev Kumar v. Commissioner of Sales Tax, M.P. & Ors. (1995 Supp M/s.Bhagatram and SC232) ofAssam&Ors.(AIR1961 Ltd. v.State based on thejudgements rendered in the case of Atiabari Tea Co. various entering intotheState.Theselegislationwerechallengedbefore Various States had enacted legislation levying entry tax on goods larger Benchmadeinthefollowingcircumstances. of thequestionsthat lies atthebottomofpresentreference to a (9) (8) (7) (6) (5) (4) (3) and (10)

aforesaid if entrytaxiscompensatoryincharacterandtheanswerto the of the Schedule VII is violative of Article 301 of the Constitution? If Whether impositionofentrytaxleviedintermsEntry52ListII clause (b)ofArticle304? clause (a) of Article 304 is conjunctive with or separate from 304 of the Constitution for determining their validity and whether to betestedwithreferencebothclauses(a)and(b)ofArticle Whether the State enactments relating to levy of entry tax have be savedbyanyotherarticle? saved by reference to Article 304of the Constitution aloneor can the trade and thus violates Article 301 of the Constitution can be Whether ataxongoodswithintheStatewhichdirectlyimpedes consumers infringesArticle301oftheConstitution? of beingpassedonandhasbeenbytraderstothe Whether the non-discriminatory indirect State tax whichiscapable and ifso,towhatextent? case and Automobile Transport case apply to entry taxcases on vehicles (commonly known as “transport”) cases in Atiabari Whether interpretation of Articles 301 to 304 in the context of tax are notsold,usedorconsumed? border orwhenitpassesthroughalocalareawithinwhichthey goods whenthereisnobartotheentryofatState Whether theentrytaxcanbetermedaonmovementof the movementofgoodsceasesin“localarea”? for beingsold,usedorconsumedcometorest(standstill)after meant goods the where atall levied taxmaybe entry the Whether matter oftaxesimposedunderPartXIII? Will theprinciplesofquidproquorelevanttoafeeapplyin was collected? State tospendthetaxcollectedwithinlocalareainwhichit explicit inEntry52ListII,ScheduleVIIwhichwouldcompelthe Constitution asperArticle266andthereisnothingexpressor with law and for the purposes and in the manner provided in the of theStateandwouldhavetobeappropriatedinaccordance Fund oftheStatebeingarevenuereceivedbyGovernment entry tax which ordinarily would be credited to the Consolidated field other taxing entries in the Schedule, merely provides a taxing Whether Entry52ListII,ScheduleVIIoftheConstitutionlike tax? be appliedtodeterminethecompensatorycharacterofentry represented by thecostsincurredinprocuring thefacility/ demonstrate thatthevalue of thequantifiablebenefitis of a compensatory levy, must, on the principle of equivalence Whether alevyunderEntry52List II,evenifheldtobeinnature fiscal answer High for matters. exercising Courts question

in the There which affirmative is the in resulted is power the no affirmative gainsaying whether in to conflicting levy

such and what that whether judgements levy are it is

the can the yardsticks be collection importance protected 81 that were of to

Legal World Legal World paid onthegrosssalestax-Held,yes taxagainstgrosssalestax-whetherthesurchargetobe tax- adjustmentofentry Orissa SalesTax Tax ActreadwithOrissa Entry Act-surchargeongrosssales Shiva KirtiSingh&R.K.Agrawal,JJ.[Decided on28/10/2016] Civil AppealNos.5913-5920of2008 withCivilAppealNos.5921of2008 AUTO LTD &ANR[SC] COMMISSIONER OFCOMMERCIALTAX &ORSv. BAJAJ LW: 80:12:2016 8. 7. 6. 5. 4. 3. 2. 1. to thereference: of caselawstheSupremeCourtrenderedfollowinganswers to catena on theissueandreferring discussions After elaborate Answers tothereference: 82 10. 9.

the purposeofentrytax?” State or a part thereof can be comprehended as local area for provided in the “local area” concerned and whether the entire recompense for the provider of the services/facilities) to be services (whichcostsinturnbecomethebasisofreimbursement/ Therefore, in theprotectionist sense) andnot on meredifferentiation. Article 304(a)frownsupondiscrimination(ofahostilenature are notproducedwithinthetaxingState. goods similar although therein ispermissible consumption A taxonentryofgoodsintoalocalareaforuse,saleor pronouncements are to the extent of such reliance over ruled. Jindal cases (supra) andallother judgments that follow these Transport and Decisions ofthisCourtinAtiabariAutomobile has nojuristicbasisandisthereforerejected. Transport The compensatory tax theory evolved in Automobile disjunctively. Clauses (a)and(b)ofArticle304havetoberead tax wouldnotconstituteaninfractionofArticle301. by Article 304(a). It follows that levy of anon-discriminatory Only suchtaxes asarediscriminatory innature areprohibited 301 doesnotmean“freefromtaxation”. of the Constitution of India. The word ‘Free’usedinArticle Taxes simpliciterarenotwithin the contemplation of Part XIII under Article304(b)ortheprovisothereissatisfied. procedure ifthe even saved be cannot 304(a) thatviolates A levy determined bytheregularbencheshearingmatters. satisfy thistest levies inthepresentcaseindeedislefttobe the whether Thequestion of theConstitution. Article 304(a) fall equally.Suchmeasuresiftakenwouldnotcontravene from otherStatesandgoodsproducedwithintheState to legislations ensurethat the tax burden ongoodsimported States are well within their right to design their fiscal the matters. benches hearing by theregular be determined satisfy the leviesinpresentcaseindeed thistest is left to areas wouldnot violate Article 304(a). The question whether backward economically fashion withaviewtodeveloping class of dealers for a limitedperiodof time inanon-hostile open tobedeterminedinappropriateproceedings. ofIndiafromanothercountryareleft entering thelandmass goods on entry taxcanbelevied whether and area a local The questions case incentives, whether and subsequently set-offs the . entire etc. modified State granted can in to be Jindal’s a notified specified case as

set aside. passed bytheHighCourtcannot besustainedandisliableto In view of the forgoing discussion, the impugned judgment and order a dealer. Act is to be levied before deducting the amount of entry tax paid by opinion that the amount of surcharge under Section 5A of the OST of theOETActandRule18Rules,weareconsidered Thus, on a conjoint reading of Section 5 of the OST Act, Section 4 accordance withtheprovisionsofOSTAct. quantification Act isindependentoftheprovisionsOETAct.Theassessment or centum of tax payable under the OST Act. Tax payable under the OST sales to theextentofentrytaxalreadypaidforsamearticlewhich way, prescribesfor reduction of the tax amount payablebythe dealer him undertheOSTAct.Section4(1)ofOETAct,insame OST Act to pay surcharge @ 10% on the amount of tax payable by Act createsachargeandimposesliabilityoneverydealerunderthe OET ActandtheRules,itcanbeseenthatSection5AofOST On aplainreadingoftheprovisionsOSTActaswell of surchargeunderSection5AtheOSTAct. amount ofentrytaxfromthepayablebeforelevy contained intheOETAct,adealerisnotentitledforreductionof the mannerlaiddownforlevyofsurcharge.Inviewprovisions nothing butanadditionaltaxandispayableonthesaleofgoodsin it canneithercurtailsnorexpandsitsambit.Further,surchargeis exhaust thefullcontentofsectionwhichitillustratesbutequally It iswellsettledthatanillustrationgivenundertheRulesdoesnot the amountofentrytax? sales tax or on the net amount of sales tax after setting of or deducting Section 5AoftheOSTActistobecomputedongrossamount The sole question for consideration is whether the ‘Surcharge’ under Reason: Decision: Appealallowed. has tobecalculatedwithoutdeductingtheentrytaxfromOST. entry tax, while the department contended that surcharge on OST respondents calculated the surchargepayableonOST after deducting Again there is a provision to pay surcharge also on the OST. The Under theOSTAct,thereisaprovisiontodeductentrytax. Entry TaxAct,1999(inshort‘theOETAct’). were bought into the State of Orissa under Section 3(3) of the Orissa The respondents had been paying entry tax on the goods when they (in short‘theOSTAct’)aswellundertheCentralSalesTaxAct. Vehicles and are registered dealers under the Orissa Sales Tax Act The respondentsareengagedinthesaleandpurchaseofMotor facts: Brief surcharge, Section 5AoftheOSTActisaself-containedprovisionand the under theOSTAct. 1 and2ofSection4theOETActprovideforreductionliability provision ofsetoffbyway“reductionintaxliability”.Sub-Sections the regarding idea broad a OETActgives the 4of ofSection heading Act andtheRulesframedthereundernotinOSTAct.The enacted in1999.TheprovisionofsetoffhasbeenmadetheOET that OSTActwasenactedintheyear1947whereasOET here tomention important Itis off’. ‘set of modality the down lay Rules the salestaxorsurcharge.Inessence,provisionsmadein or theRuleshavetobetakenintoconsiderationwhileassessing anything, which would indicate that the provisions of the OET Act tax is as payable. or already computation DECEMBER 2016 The seen Section, above, of surcharge does I is CHARTERED SECRETARY liveable not shall specifically at have the to specified contemplate be made per in CHARTERED SECRETARY I DECEMBER 2016 83 82 DECEMBER 2016 I CHARTERED SECRETARY patent appealtothedivisionbench. High holding company in the liswhich was declinedbythe Tribunal. On appeal respondent. It is pertinent that the order of the reference was sent only to the second workmen concernedentitled?” workmen down theirestablishmenton15.12.2009andretrenchingtheservicesof106 Ltd., NewDelhi, asubsidiaryofLufthansa German Airlines(Carrier), inclosing “Whether theactionofManagementM/sGlobeGroundIndiaPrivate Central Government made the following reference to the Tribunal to decide: December, 2009.Theappellantunionraisedanindustrialdisputeandthe services fromthemattheInternationalAirportDelhiwitheffect15th informed thesecondrespondentthattheywouldstopavailing ground handling services andancillary handling ground 230 workmen.Thesecondrespondentprovided operations at the Delhi International Airport in 1999 and had employed about of appellant unionhadpredicatedanddefendedtheirassertionforimpleadment It is apparent from the impugned order passed by the single Judge thatthe Reason: Decision: Appealdismissed. subsidiary Appellant is the workers’ Union of the second respondent, which is the Brief facts: partywassought-whethertenable-Held,No. necessary raised the dispute- impleadement of the holding company in the proceedings as proper / company Industrial DisputesAct,1947-referenceofdisputetotribunal-workerssubsidiary Sanjiv Khanna&SunitaGupta,JJ.[Decidedon24/11/2016] LPA No.107of2016 AIRLINES &ORS[DEL] GLOBE GROUNDINDIAEMPLOYEESUNIONv. LUFTHANSAGERMAN LW: 81:12:2016 The second issue which arises for consideration is, whether inthe facts of the unacceptable andlegallyuntenable. and madeaparty.This,asgeneral oruniversalproposition,wouldbe holding or the subsidiary company, as the case may be, would be impleaded litigation against a subsidiary or holding company and its workers, the and itsemployees.Iftheaforesaid principleisnotaccepted,theninevery necessary or proper party to the litigation between the subsidiary company company would not, because of the fact that it is a holding company, be a party. Onthesaidaspect,weagreewithsingleJudgethatholding the Court first CHARTERED SECRETARY to (as respondent the of also The

per the first refused appellant annexure) first respondent. on

respondent. the to implead sought dictum is On justified I DECEMBER 2016 9th to Labour Laws that

the The implead December, Industrial & the first and first holding respondent. legal?

respondent the 2009, first company To what respondent the Hence

had first reliefs is a respondent started this necessary are i.e. letters the the its

to the appellantunionandsecondrespondent.Thefactualpositionrelating In the present case, as noticed above, there is no factual dispute between employment withthesecondrespondent. Services Ltd.Theappellant-unionseeksemploymentorrathercontinuityof second respondent and was never a shareholder in Bird Worldwide Flights and except ofthosewhowereinvolvedintradeunionactivities.Itisanaccepted company hasengagedservicesofemployeesthesecondrespondent, up anothercompany,namely,BirdWorldwideFlightsServicesLtd.andthis the second respondent has transferred its business and assets by setting terminated andretrenchedtheworkers.Itisalsopleadedallegedthat secondly, the second respondent, who is the employer, should not have to asserted No prayertothesaideffecthasbeenmade.Whatpleadedand employees ofthesecondrespondenthasnotbeenpleadedorexpounded. Piercing ofthecorporateveilregardingemploymentretrenched The or toensurecompleteandeffectiveadjudication. presence not the second respondent is uncontroverted and an admitted position. We do union again we observe that there is no lis or dispute between the appellant is requiredforsettlingallthequestionsinvolvedincontroversy.Once the that theemployeesofunion,onwhosebehalfclaimisraised,were a necessarypartyforobviousreasons.Theappellantuniondoesnotclaim second to international airlines as per the policy of the Government of India. The a Frenchcompanywhichprovidesgroundhandlingandancillaryfacilities parts India,exceptforDelhi.Thesecondrespondenthaspleadedthatitis second respondentcontinuestoprovidegroundhandlingservicesinother course of hearing, learned counsel for the appellant union has stated that the respondent is an existing company and has not been dissolved. During the It is pertinent to mention, and an accepted position, that the second second respondentisdifferent. respondent. Theissueandthelisbetweenappellantunion is be impleadedasanecessaryorproperpartytotheindustrialdispute,which an of opinionbytheCentralGovernmentmaynotbeconclusiveorbinding,but is first Government ofIndiawhilemakingthereferenceneverfeltorregarded are the terms of reference quoted above, which are lucid and clear. The As anadditionalreasonthoughnottheprimaryground,wewouldnote, issue whichhastobeadjudicatedanddecided. the secondrespondentandpleaofappellantunioniscardinal handling as an operator. They are bound by the said policy. The defense of the private operator has its own policy of awarding contracts for ground Bird Group. Further, the Delhi International Airport stands privatized and present the to no orderastocosts. appellant andthesecondrespondent.Infactsofcase,therewill be expression ofopiniononthemeritsindustrialdisputebetween the and dismissthesame.Nothingstatedinthisjudgmentwouldbetreated as In the aforesaid circumstances we would not accept the present appeal Industrial Tribunal. is requiredtobeimpleadedasaproperpartytheproceedingsbefore the pending the the operate indication think context employees respondent admitted first first and specific respondent-company, case, that respondent in of respondent the before the

flights of the of the fact the the second points claim their first or was relief holding the that present should from

respondent a opinion statement is and Industrial proper the in respondent claimed also Indira the company, be matters first matter, and lis not and treated respondent it

Gandhi will is Tribunal? or is has a belief.

necessary the necessary dispute incidental we party on directly i.e. been as fact do the the The International employees whose

that not The between factual is asserted, affect first party. adjudication to no to think the first prevent respondent, the longer presence the first matrix The respondent that reference the of was first respondent Airport

aforesaid the multiplicity a appellant the relating shareholder has respondent not and first first can to floated at made would respondent. appearance be respondent and expression Delhi 83 to union continues of confined

the actions to should not by or of and, it. and first the the the be In

Legal World Article Legal World or 011-45341034. contact DirectorateofProfessional Development,PerspectivePlanning [email protected] icsi.edu. Theregistrationsareonfirstcome first servebasis. at www. are available of January,2017 from lastweek batch commencing The detailsofsecond Finance, GovernmentofIndiatolaunchthefollowingcourses: (NIFM), InstitutionofMinistry Management, Faridabadanautonomous Institute ofFinancial National hands with the Institutehasjoined areas. Inlinewithnewlyfangledrisingareasofprofessionallearning, diversified in services focused quality render to knowledge and skills more acquire to them enabling of aim foremost the with members its to Courses (PMQ) Qualification Membership Post offers Institute The edu or011-45341034. and Studiesatacademics@icsi. Planning Perspective Development, contact DirectorateofProfessional benefit ofthesame.Foranyquery, please to registerfor thecourse(s)andavail Members arerequested registrations areonfirstcomeservebasis. of details The Registration Fees-Rs.12,500+ServiceTaxper participant(tobepaidonline). participant(s). The inclusivelearning is supported bycase studies andonlinematerial for self study offered to the Webinar classesonweekendsandonlineevaluation. with These comprehensivecourse(s)withdurationof 3Monthsareverywelllocatedfortheprofessionals 84 of internalauditing. field the in Secretaries Company for opportunities Audit (DIA). This coursewillopenavastareaof the Institute has launched Diploma inInternal including complianceandoperationalaudits, of Company Secretariesto conduct internalaudit the skills to further develop a view Therefore, with aptly suitable to perform the role of internal auditors. Secretaries beingGovernanceprofessionalsare to agreat extent.TheCompany its scope widened the concept of internal audit to the forefront andhas Section 138oftheCompaniesAct,2013introduced Diploma inInternalAudit(DIA) Batch CommencesonlastweekofJanuary,2017 Last DateforreceiptofOnlineapplication-August22,2016 ac cmecn fo Spebr , 06 r aalbe t w.cieu The www.icsi.edu. at available are 2016 1, September from commencing batch Batch CommencesonSeptember1,2016 Registrations OpenforOnlineCourse(s) Fee StructureandOtherModalities relevant intoday'sbusinessenvironment. to enhancethe skillsof CompanySecretaries Course inValuation whichoffers anintensive training assignment, the Institute has launched a Certificate Secretaries incarryingoutthevaluation Company of skills the Therefore, toenhance the valuation. professionals willbeempanelledto carryout the valuerswherein ofregistered the concept Section 247oftheCompaniesAct,2013recognises Certificate CourseinValuation DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 85

Article

Registrations Open for Online Course(s) Last Date for receipt of Online application - August 22, 2016 Batch Commences on September 1, 2016 The Institute offers Post Membership Qualification (PMQ) Courses to its members with the foremost aim of enabling them to acquire more skills and knowledge to render quality focused services in diversified areas. In line with newly fangled rising areas of professional learning, the Institute has joined hands with National Institute of Financial Management, Faridabad (NIFM), an autonomous Institution of Ministry of Finance, Government of India to launch the following courses: From the Diploma in Internal Audit (DIA) Certificate Course in Valuation 4 Section 138 of the Companies Act, 2013 introduced Section 247 of the Companies Act, 2013 recognises the concept of internal audit to the forefront and has the concept of registered valuers wherein the widened its scope to a great extent. The Company professionals will be empanelled to carry out Secretaries being Governance professionals are the valuation. Therefore, to enhance the skills of Government aptly suitable to perform the role of internal auditors. Company Secretaries in carrying out the valuation Therefore, with a view to further develop the skills assignment, the Institute has launched a Certificate of Company Secretaries to conduct internal audit Course in Valuation which offers an intensive training including compliance and operational audits, to enhance the skills of Company Secretaries the Institute has launched Diploma in Internal relevant in today's business environment. Audit (DIA). This course will open a vast area of opportunities for Company Secretaries in the field of internal auditing.

Fee Structure and Other Modalities

These comprehensive course(s) with duration of 3 Months are very well located for the professionals with Webinar classes on weekends and online evaluation. The inclusive learning is supported by case studies and online material for self study offered to the participant(s). n Clarification Regarding Filing of Offline Challans with IEPF Authority under Companies Act. n Special Court for the purposes of providing speedy trial of offences punishable with imprisonment of Registration Fees- Rs. 12,500 + Service Tax per participant (to be paid online). two years or more under the Companies Act, 2013. n Amendments to Schedule II of the Companies Act, 2013 n National Advisory Committee on Accounting Standards The details of batch commencing from September 1, 2016 are available at www.icsi.edu. The n Notification of Sick Industrial Companies (Special Provisions) Repeal Act, 2003 registrations are on first come first serve basis. n Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) Regulations, 2016 Members are requested to register for the course(s) and avail benefit of the same. For any query, please n Insolvency and Bankruptcy Board of India (Insolvency Professional Agencies) Regulations, 2016 n Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016 contact Directorate of Professional Development, Perspective Planning and Studies at academics@icsi. n Insolvency and Bankruptcy Board Of India (Insolvency Resolution Process For Corporate Persons) Regulations, 2016 edu or 011-45341034.

84 DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 85 FROM THE GOVERNMENT 02 01 1. Extraordinary, Part-II,Section(3)Sub-section(ii)] I(Vol.-IV) dated 17.11.2016. To bepublished inGazette of India, [Issued bytheMinistryofCorporateAffairsvide[F.No.01/12/2009-CL- 3. 2. 1. dated 05.12.2016] [Issued by the Ministry of Corporate Affairs [vide no. 05/05/2016 – IEPF 86 Sl. No. 1

(1) namely:- imprisonment oftwoyearsormoreundertheCompaniesAct,2013, for the purposes of providing speedy trial of offences punishable with Meghalaya, herebydesignatesthefollowingCourtasSpecial with the concurrence of the Chief Justice of the High Court of of theCompaniesAct,2013(182013),CentralGovernment, In exerciseofthepowersconferredbysub-section(1)section435 This issueswiththeapprovalofCompetentAuthority will notbeacceptedafter15.12.2016 is followed.ThecallansnotgeneratedonMCA21portal toensurethattheaboveprocedure therefore, requested transferring theamounttoIEPF All companiesare, (ii) (i) Act, Companies 2013to:- amounts toIEPF depositing undersection125of Notified on05.09.2016.itismandatoryforthecompanies (Accounting, Audit, Transfer andRefund)Rules,2016. In accordancewithInvestorEducation&ProtectionFund Judge, Shillong. Court ofDistrictandSessions (online mode only) (online File formIEPF – ItheSRNNo.ofchallan mentioning only: online Generate challan

Act, 2013. two yearsormore undertheCompanies imprisonment of speedy trialofoffences punishablewith Special Courtforthepurposesofproviding Companies Act. Challans withIEPFAuthorityunder Clarification Regarding FilingofOffline Existing Court (2) TABLE Corporate State ofMeghalaya Jurisdiction asSpecialCourt Monika Gupta Laws (3) Deputy Director 03 04 “(iv) This 2. 1. to amendScheduleIIthesaidAct,namely:- further amendments makes thefollowing hereby Government 467 oftheCompaniesAct,2013(182013),Central In exerciseof the powersconferred bysub-section (1)of section of India,Extraordinary,Part-II,Section(3)Sub-section(i)] 17/60/2012 CL-V)dated17.11.2016.TobepublishedinGazette [Issued bytheMinistryofCorporateAffairsvide[F.No. 2. . In 2. 1. namely:- lhc Government hereby makes the following Rules further to amend 469 oftheCompaniesAct,2013(182013),Central (1) and{2)ofSetion 399, 403and404readwithsub-sections In exercise of the powers conferred by sections 396, 398, Gazette of India, Extraordinary, Part-II, Section(3) Sub-section(i)] in To bepublished (Pt-I)) dated07.11.2016. 01/16/2013CL-V [Issued bytheMinistryofCorporateAffairsvide[F.No.

Companies Cost Accountant, inwhole-timepractice.” Secretary or as thecasemaybebylhe the Company commencing onorafter01stApril,2016. sub-clause (iv), the following shall besubstituted,namely:- (iv), thefollowing sub-clause rules, in principle rule8, in sub-rule (12),inclause(b)(for 2014, (hereinafter refer to rules), inthe as the principle under Companies(AccountingStandards)Rules,2006.” (Ind AS), it shallcomplywith relevant Accounting Standards required to comply withthe Indian AccountingStandards Standards (Ind AS) shall apply.Wherea company is not “(ii) Forassets, intangible therelevantIndianAccounting and wordsshallbesubstituted,namely:- brackets, letters apply”, thefollowing the words“forceshall with and ending and wordsstartingwith“(ii)Forintangible” (ii), forthebrackets,letters in para3,sub-paragraph II, Part‘A’, Act, 2013,inScheduleunder In theCompanies of jurisdictionmentionedincolumnnumber(3). as SpecialCourtinrespect shall exercisethejurisdiction The aforesaid Court mentioned in column number (2) publication intheOfficialGazelle. of their date the comeintoforcefrom shall (2) They Offices andfees)SecondAmendmentRules,2016. (Registration theCompanies may becalled (1) Theserules the AOC-4 notification Companies

Companies Act,2013 Amendments toScheduleIIofthe Accounting Standards National AdvisoryCommitteeon (Registration certification by DECEMBER 2016 shall (Registration be applicable Offices the AMARDEEP SINGHBHATIA AMARDEEP SINGHBHATIA I CHARTERED SECRETARY Offices Chartered and for Fees) accounting and Accountant or Fees) Rules, Joint Secretary Joint Secretary Rules, period 2014,

CHARTERED SECRETARY I DECEMBER 2016 87 86 DECEMBER 2016 I CHARTERED SECRETARY 05 06 clause (b)ofsection4thesaidAct. 1. Short titleandcommencement. following Regulations,namely- 2016), theInsolvencyandBankruptcyBoardofIndiaherebymakes the with section240oftheInsolvencyandBankruptcyCode,2016(31 of In exerciseofthepowersconferredbysections196,203and205 read Part-III Section-4dated22.11.2016] No: [IBBI/2016-17/GN/REG001,dated21.11.2016.PublishedinG.O.I. [Issued by the Insolvency and Bankruptcy Board of India Vide Circular 1 the notifies hereby Government the Central (1 of2004), 2003 Act, Repeal Provisions) (Special the SickIndustrialCompanies (b) ofsection4 by clause of powersconferred In exercise the 1 appoints hereby Government (1 of2004),theCentral Act, 2003 Repeal Provisions) (Special of theSickIndustrialCompanies (2) ofsection 1 In exerciseofpowersconferredbysub-section Sub Section–(ii)dated28.11.2016] dated 25.11.2016.PublishedinG.O.I.ExtraordinaryPart–IISection3 [Issued bytheMinistryofFinanceVideS.O.3568(E)and3569(E) 3. provisions of thesaidAct provisions shallcomeintoforce. Qualification ofDirectors)Rules2014 of theCompanies(Appointmentand Identification Numberunderrule11(f) (vii) ForsurrenderofDirector section 153oftheAct Idenlificalion Number(DIN)under “(vi) ForallotmentofDirector For Applicationmade st

day of December, 2016,asthedatefor the purposesof (1)

namely;- sub-item shallbesubstituted, sub-item (vi),thefollowing In the principal rules, in the Annexure, in item II, for st CHARTERED SECRETARY day of December, 2016, asthedateonwhich

These Regulations may be called the Insolvency and Board of Insolvency Professional Agencies) Regulations, 2016. Bankruptcy BoardofIndia(Model Bye-LawsandGoverning

Regulations, 2016 Insolvency ProfessionalAgencies) Laws andGoverningBoardof Board ofIndia(ModelBye- Insolvency andBankruptcy Repeal Act,2003 Companies (SpecialProvisions) Notification ofSickIndustrial PRELIMINARY CHAPTER I I DECEMBER 2016 1000 500 Companies OPC andSmall Other than AMARDEEP SINGHBHATIA 1000 500 Companies OPC andSmall R.N. Dubey R.N. Dubey Economic Adviser Economic Adviser Joint Secretary

who (b) 5. Composition oftheGoverningBoard. oftheamendedbye-lawswithBoardwithinfifteendays specifiedbytheBoard. Theinsolvencyprofessionalagencyshallfileaprintedcopy (4) 2 The (2) 3. Insolvency professionalagenciestohaveBye-Laws. be 4. Amendment ofBye-Laws. 2. Definitions.

(5) the presenceofatleastoneindependent director. Provided (4) professionals. (3) (2) (1) (3) (1) (2) defined (2) (1) (4) (3) publicationintheOfficialGazette. (1) (2)

(c) (a) An independentdirectorshallbean individual- tenure asdirectors: at thetimeoftheirappointment,andalltimesduring More thanhalfofthedirectorsshallbeindependent Not morethanonefourthofthedirectorsshallbeinsolvency their tenureasdirectors. India atthetimeoftheirappointment,andalltimesduring More thanhalfofthedirectorsshallbepersonsresidentin The Governing Board shall have aminimum of seven directors. from thedatewhensuchamendmentismadeeffective. the seventh day of the receipt of the approval, unless otherwise The amendmentstothebye-lawsshallcomeintoeffecton passing, foritsapproval. professional agency. the applicationforitsregistrationasaninsolvency A companyshallsubmittotheBoarditsbye-lawsalongwith shall havethemeaningsassignedtotheminCode. Regulations these in defined not and used expressions Unless the context otherwise requires, words and (c) A resolution passed in accordance with sub-regulation (1) shall shall (1) sub-regulation with accordance in passed A resolution the directors. the numberofvotes,ifany,castagainstresolution,by passed byvotesinfavourbeingnotlessthanthreetimes The Governing Board mayamendthebye-laws by a resolution created underthebye-lawsonitswebsite. the compositionofallcommitteesformed,andpolicies The insolvency professional agency shall publish its bye-laws, bye-laws. The bye-lawsshallatalltimesbeconsistentwiththemodel model bye-laws. (b) (a) In theseRegulations,unlessthecontextotherwiserequires- These Regulationsshallcomeintoforceonthedateof their

filed that no meeting of the Governing Board shall be held without that no meeting of the Governing Board shall be held without bye-laws who isnotaninsolvency professional; or insolvency. who isapersonofabilityandintegrity; contained intheScheduletotheseRegulations. “model bye-laws”meansthemodelbye-lawsas insolvency professionalagency; (18 of 2013), of the company registered as an “Governing Board” means the Board of Directors, as 2016 (31of2016); “Code” meanstheInsolvencyandBankruptcyCode, with has the GOVERNING BOARD expertise under shall Board CHAPTER III CHAPTER II BYE LAWS provide section in within the field 2(10) for seven all of

of finance, matters days Companies from

law, specified the

management Act, date 87 in 2013 of the its

FROM THE GOVERNMENT FROM THE GOVERNMENT

specified 5. III. OBJECTIVES 6. IV.

88 “certificate (a) 4. II. 3. 2. 1. I.

(6) (2) (2) (1) (1) DUTIES OFTHEAGENCY (1) DEFINITIONS Governing Board of Insolvency Professional Agencies) Regulations, 2016. the InsolvencyandBankruptcyBoardofIndia(ModelBye-Laws These bye-lawsmay not be amended, except in accordance with [provide fulladdress]. Companies The Agency is registered as a company under section 8 of the (hereinafter referredtoasthe‘Agency’). The nameoftheInsolvencyProfessionalAgencyis“____” GENERAL

Explanation -ForthepurposesofthisRegulation,anyfractioncontainedin Agency [Under Regulation3readwith2(1)(c)] (e) Chairperson oftheGoverningBoard. The directorsshallelectanindependentdirectorasthe (g) (f) used and not defined in these bye-laws shall have the Unless the context otherwise requires, wordsandexpressions (e) The Agencyshallnotcarryonany functionotherthanthose incidental thereto. professional agencyundertheCode,andfunctions The Agencyshallcarryonthefunctionsofinsolvency meanings assignedtothemintheCode. standards intheregulation ofitsprofessionalmembers. The Agencyshall maintainhighethicalandprofessional agency. discharge ofitsfunctionsasaninsolvency professional (b) (a) (d) In thesebye-laws,unlessthecontextotherwiserequires- (d) (c) (b)

MODEL BYE-LAWSOFANINSOLVENCY capital oftheinsolvencyprofessionalagency;and shareholders holding more than ten percent of the share who is not a member of a governing council of any of the who hadorhasnopecuniaryrelationshipwiththe who is not a shareholder of the insolvency professional agency; who isnotarelativeofthedirectorsGoverningBoard; “professional member” means an insolvency professional “professional member” means an insolvency professional it insection2(77)oftheCompaniesAct,2013. “relative” shallhavethesamemeaningasassignedto VI ofthesebye-laws; who has been enrolled as such, in accordance with Part next lowernumber. ‘not more than one- fourth’ shall be rounded down to the number; and ‘more thanhalf’shallberoundedofftothenexthigher Act, 2013(18of2013); “Governing Board”meanstheBoardofDirectors the 2016 (31of2016); “Code” meanstheInsolvencyandBankruptcyCode, membership oftheAgencygrantedunderbye-law10; financial yearsorduringthecurrentyear; of itssharecapital, duringthetwoimmediatelypreceding or any of its shareholders holding more than ten percent insolvency professional agency, or any of its directors, Act, in PROFESSIONAL AGENCY 2013 sub-clause as of with defined SCHEDULE membership” its (1), registered under or which section means office is inconsistent 2(10) the situated certificate of Companies at with ______of the

grounds Provided furtherthatsuchadditionalrequirementsshallnotdiscriminateonthe requirements forenrolment: eligibilityProvided thattheGoverningBoardmayprovideadditional 9. Eligibility forEnrolment. VI. itdeemsfit; suchmembersasitdeemsfit; 8. Other CommitteesoftheAgency. 7. Advisory CommitteeofProfessionalMembers. V. 10. Process ofEnrolmentasProfessionalMember.

(4) eligible toberegisteredasaninsolvencyprofessionalwiththeBoard: No individual shall be enrolled as a professional member if he is not PROFESSIONALMEMBERSHIP (2) (1) (2) (1) COMMITTEES OFTHEAGENCY (2) opportunity (3) withsuchfeesasmaybespecifiedbytheAgency. (2) (1)

religion, The Agencymayrequireanapplicant tosubmitadditional in theapplication. independent directoroftheAgency. The ChairpersonofeachtheseCommitteesshallbean (d) (c) (b) (a) The GoverningBoardshallconstitute- as theGoverningBoardmayprovide. The AdvisoryCommitteemaymeetatsuchplacesandtimes (c) (b) (a) pertaining to- professional membersoftheAgencytoadviseitonanymatters The GoverningBoardmayformanAdvisoryCommitteeof (g) (f) (e) (d) (c) (b) (a) The Agencyshall- On examinationoftheapplication, theAgencyshallgivean and guidelinesthereunder. the applicableprovisionsofCode, andrules,regulations The Agencyshallexaminetheapplication inaccordancewith by submittinganapplicationinsuchform,mannerand An individualmayapplyfor enrolment as a professional member least onemembernominatedbytheBoard. one ormoreDisciplinaryCommittee(s)consistingofat shall beaprofessionalmemberoftheAgency; not lessthanthreemembers,atleastoneofwhom one ormoreGrievanceRedressalCommittee(s),with a MonitoringCommitteeconsistingofsuchmembersas one ormoreMembershipCommittee(s)consistingof liquidation andbankruptcy. best practicesinrespectofinsolvencyresolution, standards ofprofessionalandethicalconduct; the developmentofprofession; provide informationaboutitsactivitiestotheBoard. professional members;and professional andethicalconductaremaintainedbyits guidelines toensurethathighstandardsof continuously improveuponitsinternalregulationsand professional members; promote continuousprofessionaldevelopmentofits develop theprofessionofinsolvencyprofessionals; and directionsissuedtoitsprofessionalmembers; be accountabletotheBoardinrelationallbye-laws professional members; practices fortheenrolmentandregulationofits employ fair,reasonable,just,andnon-discriminatory insolvency professionals; conduct ofinsolvencyprofessionalagenciesand and guidelinesissuedthereundergoverningthe ensure compliance with the Code and rules, regulations

race, DECEMBER 2016 to

caste, the

applicant gender,

place to I CHARTERED SECRETARY remove of

birth or the professional deficiencies, affiliation. if any,

CHARTERED SECRETARY I DECEMBER 2016 89 88 DECEMBER 2016 I CHARTERED SECRETARY

performdutiesasquicklyandefficientlyreasonable, (g)

13. VII. 12. Register ofProfessionalMembers.

theapplicant,alongwithacertificateofmembershipinForm 1 The 11. Professional MembershipFee. documents forremovingthedeficienciesorpresentingadditional deficienciesorsubmitadditionaldocumentsinformationto documents,

(2) (1) DUTIES OFMEMBERS (1) sum ofmoneyasitsannualmembershipfee.

(9) (8) (7)

(6) (5) CHARTERED SECRETARY

Agency (h) (f) (e) (d) (c) (b) The recordsrelatingtoaprofessionalmembershallbemade (i) (g) (f) (a) shall- In theperformanceofhisfunctions,aprofessionalmember (d) (c) (b) (a) available forinspectionto- The Agency shall maintain a register of its professional memers, The Agency shall maintain a register of its professional memers, (e) (d) (c) (b) (a) containing their- the appeal in the manner it deems expedient, within thirty days days thirty within expedient, deems it manner the in appeal the The MembershipCommitteeshallpassanorderdisposingof thirty daysfromthereceiptofsuchdecision. may appealto the Membership Committee of the Agency within An applicantaggrievedofadecisionrejectinghisapplication A oftheAnnexuretothesebye-laws. The acceptanceoftheapplicationshallbecommunicatedto of thereceiptappeal. days ofthereceipt of the application, excludingthetime given applicant statingthereasonsforsuchrejection,withinthirty The rejectionoftheapplicationshallbecommunicatedto its satisfaction,forreasonsrecordedinwriting. satisfy thecriteriaforenrolmentordoesnotremove The Agency may reject an application if the applicant does not reasonable time.

details ofdisciplinaryproceedingspendingagainsthim details ofgrievancespendingagainsthimwiththeAgency; subject tothetimelines undertheCode; continuously upgradehisprofessional expertise; professional competenceand ethics; discharge hisfunctionswiththehighest standardsof be independentandimpartial; objectivity; discharge hisfunctionswithutmostintegrityand endeavour tomaximizethevalueofassetsdebtor; professional; act in good faith in discharge of his duties as an insolvency act ingoodfaithdischargeofhisdutiesasaninsolvency Disciplinary CommitteeoftheAgency. details oforderspassedagainsthimbytheBoardor with theAgency;and number; date ofregistrationwiththeBoardand date of enrolment andprofessional membership number; member forsuchinspection. any otherpersonwhohasobtainedtheconsentof been appointed as an interim resolution professional, or resolution processwheretheprofessionalmemberhas the committeeofcreditorsinacorporateinsolvency the AdjudicatingAuthority, the Board, address; contact details; proof ofidentity; name; may

or information require clarification the I DECEMBER 2016 or professional by clarification the Agency, members that as

deems the to case pay

fit,

may within a fixed be.

21. IX. The 20. provide (b) anyothermattersthatmaybespecifiedbytheGoverning 19. (f) 18. 17. 16. 15. VIII. maintainconfidentialityofinformationobtainedinthe (i) 14.

(2) (1) GRIEVANCE REDRESSALMECHANISM (d) (c) (b) (a) information pertainingto- by theBoard with information collectedduringmonitoring,including (c) (a) The MonitoringPolicyshall– (e) (d) (c) (b) (a) The MonitoringPolicyshallprovideforthefollowing- Monitoring Policy. submitted bytheprofessionalmembersinaccordancewith The MonitoringCommitteeshallreviewtheinformationandrecords year. in ongoing and concluded engagements as an insolvency professional, A professional membershallsubmit information, includingrecords of given bytheGoverningBoard. thereunder, these bye-laws, the Code of Conduct and directions the provisionsofCode,rules,regulationsandguidelinesissued activities andconduct of professional members for their adherence to The AgencyshallhaveaMonitoring Policyto monitor the professional MONITORING OFMEMBERS Professionals) Regulations,2016. specified with, and that shall provideforallmatters in the Code of Conduct as The AgencyshallhaveaCodeofConductthatbeconsistent the

Agency (a) grievance, may- The GrievanceRedressalCommittee, afterexaminingthe (c) (b) (a) member oftheAgencyby- disclosing grievancesagainsttheAgencyoranyprofessional the procedureforreceiving,processing,redressingand The AgencyshallhaveaGrievanceRedressalPolicyproviding the outcomeofeachappointment. of hisappointment;and the transactionsconductedwiththirdpartiesduringperiod of hisappointment; the transactions conducted with stakeholders during the period the detailsofappointmentsmadeunderCode, be non-discriminatory. and disclosure ofinformationisrequiredbytheBoardorlaw, have dueregardfortheprivacyofmembers, Board. evaluation ofperformancemembers;and the use,analysisandstorageofinformationrecords; Monitoring Policy; the obligationsofprofessionalmemberstocomplywith inspection; and records of the professional members, including by way of the mannerandformatofsubmissionorcollectioninformation the frequencyofmonitoring; (h) manner in dismiss thegrievanceifitisdevoid ofmerit;or by theGoverningBoard. any other person or class of persons as may be provided concerned professionalmembersoftheAgency;or any personwhohasengagedtheservicesof any professionalmemberoftheAgency; to disclosesuchinformationbylaw. course ofhisprofessionalactivitiesunlessrequired functions; and comply withapplicablelawsintheperformanceofhis the shall for and Insolvency confidentiality submit format

a report and specified Bankruptcy of

to information the by Board the Board Agency, in received, the of manner India at least except (Insolvency 89 specified twice when a

FROM THE GOVERNMENT FROM THE GOVERNMENT theformatandmannerforfilinggrievances; (a) 22. 90 24. (d) 23. X.

(c) (b) The GrievanceRedressalPolicyshallprovidefor- (3) fitandproperpersontocontinueactingasan (3) (2) (1) (c) (b) (a) cause noticeagainstprofessionalmembers- The Agencymayinitiatedisciplinaryproceedingsbyissuingashow- DISCIPLINARY PROCEEDINGS (h) (g) (f) (e) (d)

dismissal, referencetotheDisciplinaryCommitteeor maximum timeforthedisposalofgrievancebyway grievance; maximum timeandformatforacknowledgingreceiptofa disciplinary action. the DisciplinaryCommittee,wherevergrievancewarrants The Grievance Redressal Committee shall refer the matter to (b) (b) (a) member hascommitted- of aprofessionalmemberifithasfoundthatthe The DisciplinaryCommitteemaypassanorderforexpulsion (f) (e) (d) (c) (b) (a) shall include- The ordersthatmaybepassedbytheDisciplinaryCommittee (e) (d) (c) (b) (a) for thefollowing- The AgencyshallhaveaDisciplinaryPolicy, whichshallprovide suo moto,basedonanyinformationreceivedbyit. or following thedirectionsgivenbyBoardoranycourtoflaw; based onmonitoringofprofessionalmembers; Committee; based onareferencemadebytheGrievancesRedressal periodic reviewoftheGrievanceRedressalMechanism. arrived at;and maintenance ofaregistergrievancesmadeandresolutions action tobetakenincaseofmaliciousorfalsecomplaints; the grievance; to thepartiesgrievanceupondismissalorresolutionof provision of areport of the grievance andmediation proceedings details ofthemediationmechanism initiation ofmediation; grievance. initiate amediationbetweenpartiesforredressalof insolvency professional. given bytheGoverningBoardwhich rendershimnota guidelines issuedthereunder,bye-laws ordirections a grossviolationoftheCode,rules, regulationsand six months,oranoffenceinvolving moralturpitude; punishable withimprisonmentfor a termexceeding an offenceunderanylawforthetimebeinginforce, directions relatingtocosts. Board; and restitution or compensation that may be enforced by the in appropriatecases,recommendationoftheamount reference ofthemattertoBoard,whichmayinclude, imposition ofmonetarypenalty; admonishment oftheprofessionalmember; period oftime; suspension oftheprofessionalmemberforacertain expulsion oftheprofessionalmember; rights andobligationsofthepartiestoproceedings. notice; and timelines fordifferentstagesofdisposalshowcause following principlesofnaturaljustice; disposal ofshow-causenoticebyareasonedorder, the issueofshow-causenoticebasedonfacts; ascertain facts; the mannerinwhichDisciplinaryCommitteemay\

experience 25. inanyothercaseitdeemsfit. (vii) disadvantageofapartywhichcannotbejustifiedwith XI. daysfromthereceiptofacopyfinalorder. starts (c) 26. Temporary SurrenderofProfessionalMembership.

(1) (5) (4) (3) (2) (2) Board. the registersofAgency,andsameshallbeintimatedto name of the professional member shall be temporarily struck from the surrender, temporary for ofapplication date fromthe days of thirty and uponacceptance of suchtemporary surrenderandoncompletion (1) EXPULSION FROMPROFESSIONALMEMBERSHIP AND MEMBERSHIP PROFESSIONAL OF SURRENDER

member fromamongstthepersonsofeminencehaving consisting ofoneindependentdirectortheAgency, The GoverningBoardshallconstituteanAppellatePanel and Bankruptcy Fund constituted undersection 224oftheCode. the Disciplinary Committee shall be credited to the Insolvency Monetary penalty received bythe Agency under theordersof each ofthepartiestoproceeding. of the said order, andacopy of the order shall beprovided to on the website of the Agency within seven days from passing Any orderpassedbytheDisciplinaryCommitteeshallbeplaced (vi) (v) (iv) (iii) appeal. it deemsexpedient,withinthirtydaysofthereceipt The AppellatePanelshalldisposeoftheappealinmanner may preferanappealbeforetheAppellatePanelwithinthirty Any person aggrieved of an order of the Disciplinary Committee the Board. (ii) (b) (a) membership oftheAgencyshallbe acceptedif- No applicationfortemporarysurrenderofprofessional (b) (a) before he- surrender ofhismembershiptheAgencyatleastthirtydays A professional membershallmakeanapplication for temporary (i)

liquidation orbankruptcyprocess; reference totheinterestsofinsolvencyresolution, providing unequalordifferentialtreatmenttothe VII ofPartIIItheCode, accordance withChapterVIIofPartIIor aiding orabettinganyactivitywhichisactionablein accordance withsections71or187oftheCode; contravening provisionsoftheCodeinvitingactionin 124 oftheCode; permitting contraventionofsections14,96,101or knowingly orwilfullycommittingauthorizing the Code; is actionableinaccordancewithsections70(2)or185of contravening provisions of the Code in a manner which 28, 31,111or153oftheCode; purpose of obtaining creditors’ approval under sections making afalse representation or indulginginfraud for the the professionalmemberhasbeen appointedasa cooperate insuchproceeding;or the Board,andhehasnotgiven anundertakingto against theprofessionalmemberbefore theAgencyor there isagrievanceordisciplinary proceedingpending the CodeofConduct; takes upemployment;or becomes apersonnotresidentinIndia; include- Explanation: DECEMBER 2016 any in the business, field The violationsreferredtoinsub-clause(b) of law, except I and CHARTERED SECRETARY as one specifically member nominated permitted under by

CHARTERED SECRETARY I DECEMBER 2016 91 90 DECEMBER 2016 I CHARTERED SECRETARY Date: Place: Sd/- Thiscertificateshallbevalidfrom[insertdate]. 2. 1. No......

27. Surrender ofProfessionalMembership d upon thecancellationofhiscertificateregistrationby (d) 30. Expulsion fromProfessionalMembership. 29. 28.

number]. professional agency]withmembershipno.[insert enrolled asaprofessionalmemberof[insertnameinsolvency This istocertifythat[insertname]residingataddress] (2) (1) (3) (e) (c) (b) (a) A professionalmembershallbeexpelledbytheAgency– (b) (a) any professionalmemberif- The Agencymay refuse toaccept the surrender ofmembership by struck fromtheregistersofAgency. surrendering hismembershipshallbeclearedpriortonamebeing Any fee that is due to the Agency from a professional member CHARTERED SECRETARY CERTIFICATE OFPROFESSIONALMEMBERSHIP For andonbehalfof[nameinsolvencyprofessionalagency] name oftheprofessionalmembershallbestruckfrom completion of thirty daysfrom the date of suchacceptance, the Upon acceptanceofsuchsurrenderhismembership,and application forsurrenderofhismembership. membership oftheAgencymaydosobysubmittingan A professionalmemberwhowishestosurrenderhis intimated totheBoard. inserted intheregisterofAgency,andsameshallbe revival, thenameofprofessionalmembershallbere- to beapplicable,anduponacceptanceoftheapplicationfor for temporarysurrenderasprovidedinsub-clause(1)cease temporarily surrenderedmembershipwhentheconditions A professional member may make an application to revive his upon theorderofanycourtlaw. Board; least twonoticesservedinwriting; upon non-paymentofprofessionalmembershipfeedespiteat Committee, unlesssetasideorstayedbytheAppellatePanel; on expiryofthirtydaysfromtheorderDisciplinary if hebecomesineligibletobeenrolledunderbye-law9; professional maybedetrimentaltosuchprocess. under theCode,andappointmentofanotherinsolvency professional, liquidatororbankruptcytrusteeforaprocess the professionalmemberhasbeenappointedasaresolution Board; or against theprofessionalmemberbeforeAgencyor there isanygrievanceordisciplinaryproceedingpending Board. registers of the Agency, and the same shall be intimated to the (Under bye-law10oftheAgency’sbye-laws) such process. another insolvencyprofessionalmaybedetrimentalto for aprocessundertheCode,andappointmentof resolution professional,liquidatororbankruptcytrustee ANNEXURE FORM A I DECEMBER 2016 Dr. M.S.SAHOO Chairperson

07 c “certificate (c) ithasapaid-upsharecapitaloffivecrorerupees, (d) 3. Eligibility forregistration. used publicationintheOfficialGazette. 2. Definitions. 1. Short titleandcommencement. in termshereof,namely- provide aframeworkfor regulation ofinsolvencyprofessionalagencies 2016 (31of2016),theBoardherebymakesfollowingRegulationsto and 220 read with section 240 of the Insolvency and Bankruptcy Code, 196,201,202,219, conferredbysections In exerciseofthepowers Extraordinary Part-IIISection-4dated22.11.2016] No: [IBBI/2016-17/GN/REG002,dated21.11.2016.PublishedinG.O.I. [Issued by the Insolvency and Bankruptcy Board of India Vide Circular

than10%ofitssharecapitalarefitandproperpersons. (h) (g) (f) (e) (c) (b) (a) 8 oftheCompaniesAct,2013,andprofessional agencyunlessitisacompanyregisteredundersection No person shall be eligible to be registered as aninsolvency (2) (1) (2) (1) Explanation: itself, itspromoters,directors and personsholdingmore subsidiary; Explanation: “layer”inrelationtoabodycorporate meansits one layer: it isnotasubsidiaryofbodycorporatethroughmorethan indirectly, bypersonsresidentoutsideIndia;and not morethan49%ofitssharecapitalisheld,directlyor it isnotunderthecontrolofperson(s)residentoutsideIndia, it hasaminimumnetworthoftencrorerupees; Professional Agencies),2016; (Model Bye-LawsandGoverningBoardofInsolvency the InsolvencyandBankruptcyBoardofIndia it hasbye-lawsandgovernancestructureinaccordancewith professional agencyundertheCode; its soleobjectistocarryonthefunctionsofaninsolvency meanings assignedtothemintheCode. Unless the context otherwise requires, wordsandexpressions (d) (b) (a) In theseRegulations,unlessthecontextotherwiserequires- These Regulationsshallcomeintoforceonthedateoftheir Regulations, 2016. Bankruptcy BoardofIndia(InsolvencyProfessionalAgencies) These RegulationsmaybecalledtheInsolvencyand

in section2(27)oftheCompaniesAct,2013; “control” shall have the same meaning as assigned to it it undersection2(57)oftheCompaniesAct,2013. “net worth”shallhavethesamemeaningasassignedto these Regulations; registration grantedorrenewedbytheBoardunder 2016; “Code” meanstheInsolvencyandBankruptcyCode, Agencies) Regulations,2016 of India(InsolvencyProfessional Insolvency andBankruptcyBoard and not For defined determining REGISTRATION of PRELIMINARY CHAPTER II CHAPTER I registration” in these whether Regulations, means a person a certificate shall is fit and 91 have of proper

the

FROM THE GOVERNMENT FROM THE GOVERNMENT it hascompliedwiththeconditionsofcertificate (d) f abidebysuchotherconditionsasmaybespecified. (f) yearaftertheinwhichcertificateisgrantedor b at (b)

c pay (c) deems IftheBoardissatisfied,aftersuchinspectionorinquiryasit (1) authorisedrepresentativeforclarificationsrequired 5. Grant ofcertificateregistration. clarificationthatitdeemsfit. opportunitytotheapplicantremovedeficiencies, non-refundableapplicationfeeoffivelakhrupees. 92 competenceincludingfinancialsolvencyandnetworth. 4. (iii) Application forregistrationorrenewalthereof. consideration

(2) clarification, orappearinginperson,asthecasemaybe.

the of theapplication,excludingtimegivenbyBoardforremoving B oftheScheduletotheseRegulations,withinsixtydaysreceipt carry ontheactivitiesofaninsolvencyprofessionalagencyinForm (6) (5) (4) (3) (2) (1) (ii) (i) may

deficiencies, (c) (e) (d) (a) insolvency professionalagencyshall- The registrationshallbesubjecttotheconditionsthat (b) (a) in section200oftheCode,thatapplicant:— processing theapplication. reasonable time,beforetheBoardinperson,orthroughits The Boardmayrequiretheapplicanttoappear,within reasonable time,additionaldocuments,informationor The Boardmayrequiretheapplicanttosubmit,within if any,intheapplication. The Boardshallexaminetheapplication,andgivean Regulation withinsevendaysofitsreceipt. The Boardshallacknowledgeanapplicationmadeunderthis Form AoftheScheduletotheseRegulations,alongwitha expiry ofsuchregistration,make an application for renewalin registration underRegulation5,maysixmonthsbeforethe An insolvencyprofessionalagencywhohasbeengranted application feeoftenlakhrupees. the ScheduletotheseRegulations,alongwithanon-refundable agency, maymakeanapplicationtotheBoardinFormAof A companyeligibleforregistrationasaninsolvencyprofessional absence ofconvictionsandrestraintorders, integrity, reputationandcharacter, following criteria- under theseRegulations,theBoardmaytakeaccountofany grant

renewal underRegulation4(2) registration, ifhehassubmittedanapplicationfor to performitsfunctionsundertheCode;and professional andotherrelevantexperience,toenableit has initsemployment,personshavingadequate the Code; has adequate infrastructure to perform its functions under take adequatestepsforredressal ofgrievances;and professional agency; directly orindirectly, ofthe sharecapital of the insolvency statutory body, seeks to hold more than ten percent, seek approvaloftheBoardwhena person,otherthana renewed; thereunder anditsbye-laws; abide bytheCode,rules,regulations,andguidelines is eligibleunderRegulation3; satisfy therequirementsundersub-regulation(1); or necessary all renew a or fee times presenting as of a five it after and certificate deems lakh having the additional rupees grant fit, of regard including registration of to documents, the to the the Board, certificate but principles to not the payable information limited applicant continue specified every to or to the to

for 7. Surrender ofregistration. continueitsfunctionstillsuchtimeasmaybespecified, (b) accepttheapplication,alongwithcertificateof (a) clarifications,orappearinginperson,asthecasemaybe. deficiencies,presentingadditionaldocuments,informationor the enableittoformafinalopinion. to 6. The Procedure forrejectingapplication. (3)

The (5) continueitsfunctionstillsuchtimeasmaybespecified, (b) (1) (4) (3) (2) (1)

conditionsasitdeemsfit. (4) (3) (2) SURRENDER ORCANCELLATIONOFREGISTRATION

An insolvencyprofessionalagencymaysubmitanapplication (c) (a) shall requiretheinsolvencyprofessionalagencyto- The orderrejectinganapplicationforrenewalofregistration (b) decision to- under sub-regulation(1),theBoardshallcommunicateits After considering the explanation, if any, given by the applicant excluding thetimegivenbyBoardforremoving The communicationundersub-regulation(1)shallbemadeto days ofthereceiptcommunicationfromBoard,to forming suchanopinionandgivetheapplicantopportunity additional conditions,itshallcommunicatethereasonsfor not begrantedorrenewed,renewedwith the Boardisofprimafacieopinionregistrationought If, afterconsideringanapplicationmadeunderRegulation4, years fromthedateofissue. (b) (a) providing - regulation (4) have been complied with, shall publish a notice on regulation (4) have been complied with, shall publish a notice on (a) insolvency professionalagencyto- The approvalundersub-regulation(3)mayrequirethe the application for surrender of registration subject to such days fromthelastdateofsubmissionobjections,approve under sub-regulation(2),ifany,theBoardmaywithinthirty After consideringtheapplicationandobjectionssubmitted submitted withinfourteendaysof the publicationofnotice. and inviteobjectionstothesurrenderofregistration,be publish anoticeofreceiptsuchapplicationonitswebsite application, the of receipt of days seven within shall Board The (d) (c)

explain surrender applicant certificate Board, appropriate. comply withanyotherdirectionsasconsidered insolvency professionalagency;and to enabletheenrolmentofitsmemberswithanother discharge pendingobligations; within thirtydaysofreceiptexplanation. reject the application by an order, giving reasons thereof registration, or the detailsofallpendingoron-goingengagements the reasonsforsuchsurrender; insolvency professionalagency. to enabletheenrolmentofitsmembers withanother discharge anypendingobligations; or insolvency professionalagency. the mannerinwhichitseekstowind-upitsaffairsasan details ofitspendingoron-goingactivities;and with it; under the Code of the insolvency professionals enrolled

why DECEMBER 2016 after within of its of being a application registration CHAPTER III certificate forty satisfied five

I should days CHARTERED SECRETARY shall of that registration of be

be receipt the valid

accepted, requirements for of to the a the period within application, Board, of

fifteen of sub- five

CHARTERED SECRETARY I DECEMBER 2016 93 92 DECEMBER 2016 I CHARTERED SECRETARY theregisteredoffice,bypostwith

. 1 Based (1) 8. Disciplinary proceedings. (13) (12) (11) (10) (9) (8) (7) (6) (5) (4) (3)

(2)

the

CHARTERED SECRETARY

If theorderpassedundersub-regulation (10)suspendsor on thewebsiteofBoard. the insolvency professional agency immediately, and published The orderpassedundersub-regulation (10)shallbeissuedto in theorderalongwithreason forthesame. of theorderunlessDisciplinary Committee statesotherwise effective until thirty days have elapsed from the date of issue The orderpassedundersub-regulation(10)shallnotbecome (d) (c) (b) (a) The order in disposal of a show-cause notice may provide for- dispose oftheshow-causenoticebyareasonedorder. and materialonrecord,theDisciplinaryCommitteeshall circumstances and facts material relevant the considering After any, madebytheinsolvencyprofessionalagency. The DisciplinaryCommitteeshallconsiderthesubmissions,if assignment. show-cause noticewithinaperiodofsixmonthsthe The Disciplinary Committee shall endeavour to dispose of the to principlesofnaturaljustice. notice assignedunder(5)byareasonedorderinadherence The DisciplinaryCommitteeshalldisposeoftheshow-cause of theshow-causenotice. The Boardshall constitute aDisciplinary Committee for disposal (b) (a) professional agencyinthefollowingmanner- A show-cause notice issued shallbe served on theinsolvency report ofinvestigationorinspection,otherrecords. documents andextractsofrelevantportionsfromthe The show-causenoticeshallenclosecopiesofrelevant the DisciplinaryCommittee shallrequiretheinsolvency cancels the registration of the insolvencyprofessional agency, (h) (g) (f) (e) (d) (c) (b) (a) The show-causenoticeshallbeinwriting,andstate- cause noticetotheinsolvencyprofessionalagency. actions permissibleundersection220,itshallissueashow- material otherwiseavailableonrecord,iftheBoardisof its websitestatingthatthesurrenderofregistrationby insolvency professionalagencyhastakeneffect.

prima procedure to be followed for disposal of the show-cause 220(5). a referencetotheBoardtakeanyactionundersection any oftheactionsundersection220(2)to(4);or warning; no action; Board. provided bytheinsolvencyprofessionalagencyto by anappropriateelectronicmeanstotheemailaddress acknowledgement due;or by sendingittotheinsolvencyprofessionalagencyatits notice. notice; and consequences offailuretorespondtheshow-cause is requiredtorespondtheshow-causenotice; the mannerinwhichinsolvencyprofessionalagency or issueiftheallegationsareestablished; the actionsordirectionsthatBoardproposestotake in whichthepublicinterestisallegedlyaffected; thereunder allegedlyviolated,orthemanner the provisions of the Code, rules, regulations or guidelines the provisionsofCode,rules,regulationsorguidelines the details of the evidenceinsupport ofthe allegedfacts; the detailsofallegedfacts; the provisions of the Code under which it has been issued; on the facie findings opinion I DECEMBER 2016 of that an inspection sufficient or cause investigation, exists to or take on

b continue (b) a theapplicantisafitandproperperson; (a) If (2) 10. Grant ofin-principleapproval. 9. Appeal. renewalofcertificateregistrationasinsolvency (b) grantofcertificateregistrationasinsolvency (a) . I, 3. Madam/Sir, insolvency professionalagency to Subject: [Name andaddress] From [Insert address] The InsolvencyandBankruptcyBoardofIndia The Chairperson To (Insolvency ProfessionalAgencies)Regulations,2016) (Under Regulation4oftheInsolvencyandBankruptcyBoardIndia I,onbehalfof[insertname],herebyaffirmthat– 4. exceeding it maygrantin-principleapprovalwhichshallbevalidforaperiodnot satisfied, rupees. (1) prescribed inPartIIIoftheNationalCompanyLawTribunalRules,2016. a period of thirty days of receipt the impugned order in the manner An appealmaybepreferredundersection202oftheCode,within 2. 1. (3)

Application (a) professional agencyto- (b) deems necessary,that:– demonstrating thattheconditionsinsub-regulation(2)are agency may make an application for an inprinciple approval, Any personwhoseekstoestablishaninsolvencyprofessional (c) association andthebye-laws,asapplicable,ofapplicant Copies ofthememorandumassociation,articles of [nameandaddresstheapplicant]for I, being duly authorized for the purpose, hereby apply on behalf are enclosed. During the validity of in-principle approval, the company referred During the validity of in-principle approval, the company referred of registration as an insolvency professional agency to the required topaytheapplicationfeesforregistration. 4(1),butshallnotbe Board inaccordancewithRegulation (a) to beregisteredasaninsolvency professional agency. on the sub-regulation Application forCertificateofRegistration

behalf one discharge pendingobligations; grant ofregistrationunderRegulation5(1), registration wouldbeabletomeettherequirementsfor the proposedorexistingcompanywhichmayreceive comply with any other directions as considered appropriate. insolvency professionalagency;and to enabletheenrolmentofitsmemberswithanother correspond withtheBoardinthisrespect. resolution authorizingmetomakethisapplicationand professional agency,andencloseacopyoftheboard professional agency,or correct inallmaterialrespects, all informationcontainedinthisapplication istrueand Board

year along for IN-PRINCIPLE APPROVAL of is grant [insert and its satisfied, with 2(b) functions be CHAPTER IV SCHEDULE or a name], FORM A subject nonrefundable may renewal after make till affirm to such such of such an certificate that time application inspection application conditions the as may applicant of be for or registration as fee inquiry specified, a it of 93 certificate deems is

ten eligible as lakh as fit.

FROM THE GOVERNMENT FROM THE GOVERNMENT 8. Please provideauditedfinancialstatements of: 12. 11. 10. 9. 94 . Address 2. 1. Place : Date : (Designation) (Name) Sd/- 5. CorporateIdentificationNumber(CIN). 4. PAN. 3. 7. 6. No. Sl. MEMORANDUM OFASSOCIATION,ARTICLESASSOCIATION

or indirectly,ofthesharecapitalapplicant. Please providedetailsofthepersonsholdingmorethan10%,directly (a) If so,pleaseprovidedetails. management orpolicydecisionsof theapplicant? Do personsresidentoutsideIndia exercisecontroloverthe Who exercisescontrolovertheapplicant? Pleaseprovidedetails. Please providedetails. of thesharecapitalapplicant? Do personsresidentoutsideIndiainaggregateholdmorethan49% 5.

conditions Board ofInsolvencyProfessionalAgencies)Regulations,2016(ifany). Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing are Please specifytheclausenumberofprovisionsbye-lawswhich

Name oftheapplicant. subsequently. make thisapplicationandcorrespondwiththeBoardinrespect. Name, designation and contact details of the person authorized to (Insolvency ProfessionalAgencies)Regulations,2016.(Yes/No) Regulations, 2016,andtheInsolvencyBankruptcyBoardofIndia Laws and Governing Board of Insolvency Professional Agencies) with the Insolvency and Bankruptcy Board of India (Model Bye- and bye-lawsprovideforallmattersasrequiredin,areconsistent Please stateifthememorandumofassociation,articlesassociation shareholder Name andaddressofthe in applicant (ifany), a companyholding morethan10%ofthesharecapital ofthe to complywiththerequirementsofCode,rules, If granted registration, I, on behalf of [insert name], undertake (c) (b) regulations orguidelinesissuedthereunder,andsuchother registration or be specified or imposed by the Board SHAREHOLDING ANDFINANCIALSTRENGTH addition of registered in materialrespectsatanystage. information submittedisfoundtobefalseormisleading application maybecancelledsummarilyifany registration grantedorrenewedinpursuanceofthis application hasbeensuppressed,and no materialinformationrelevantforthepurposeofthis to and the ANNEXURE TOFORMA office provisions terms registration number issue/ company country of PAN /PassportNoand AND BYE-LAWS and GENERAL PART III PART II as PART I principal may of the be place model contained of bye-laws business or holdingcompany applicant companyand/ shareholding inthe Percentage of Authorized Signatory in the Yours faithfully, specified of the certificate applicant. in the of

this The Insolvency and Bankruptcy Board of India hereby grants/ renews Place : Date : (Designation) (Name) Sd/- application. Please provideanyotherdetailsyouconsiderrelevantinsupportof the 20. 19. 18. as aninsolvencyprofessionalagency inaccordancewiththeInsolvency 14. 13. thenumberandlocations ofoffices, (a) 17. 16. 15. No. Sl.

certificate its bye-laws,anyregulationsoftheBoardorCode. instituted againsttheinsolvencyprofessionalagencyorbyitunder Please providedetailsofanygrievanceredressalproceedings compliance withtheBoard’srequirementsinrespectofreporting. Please provide details of the insolvency professional agency’s compliance withtheconditionsofitscertificateregistration. Please provide details of the insolvency professional agency’s Please statethedetailsofapplicant’sBoardDirectors: promoters ofthecompanyarefitandproperpersons. holding morethan10%ofthesharecapitalcompany,and Please provideanyother information todemonstrate thatthe persons company, whicheverisless. of thelast three years or from the dateofincorporation (d) (c) (b) (d) (c) (b) insolvency professionalagency,including: proposes to have to enableit to discharge its functions as an Please state the infrastructure the applicant currently has and Please providenumberofemployees,category-wise. directors arefitandproperpersons. Please provideanyotherinformationtodemonstratethatthe THE INSOLVENCYANDBANKRUPTCY BOARDOFINDIA director Name andaddressofthe the applicant, promoter company(ifany), a companywhoisincontroloftheapplicant(ifany), library andtrainingfacilities. IT andothercomputerfacilities, redressal anddisciplinaryproceedings, infrastructure inrespectofenrolment,monitoring,grievance [For applicationsforrenewalofregistration] of registration Certificate ofRegistrationNo. _ DIRECTORS ANDEMPLOYEES DECEMBER 2016 INFRASTRUCTURE COMPLIANCE PAN DIN and to/of SCHEDULE FORM B PART IV PART VI PART V _____[insert I CHARTERED SECRETARY name against thedirectors proceedings concluded criminal Details ofanypendingor Authorized Signatory and address] to act CHARTERED SECRETARY I DECEMBER 2016 95 94 DECEMBER 2016 I CHARTERED SECRETARY 08 3.

“certificate (b) 2. Definitions. 1. Short titleandcommencement. Regulations, namely- Code, 2016(31of2016),theBoardherebymakesfollowing and Bankruptcy 208 readwithsection240oftheInsolvency and 196, 207 by sections conferred of thepowers In exercise Published inG.O.I. ExtraordinaryIIISection-4dated22.11.2016] 23.11.2016. dated No:[IBBI/2016-17/GN/REG003, Circular [Issued by theInsolvencyandBankruptcyBoardof India Vide The and BankruptcyCode,2016.

Date: Place : Sd/- end date]andmayberenewed.

certificate

(1) (2) used (1) (2) (1)

CHARTERED SECRETARY (For andonbehalfofInsolvencyBankruptcyBoardIndia)

meanings assignedtotheminthe Code. The Boardshall, eitheronitsownorthroughadesignated Unless the context otherwise requires, words andexpressions (g) (f) (a) In theseRegulations,unlessthecontextotherwiserequires- 2016. These Regulationsshallcomeintoforceon29thNovember, Regulations, 2016. Bankruptcy BoardofIndia(InsolvencyProfessionals) These Regulations may be called the Insolvency and (e) (d) (c)

of agency; enrolled as a member of an insolvency professional “professional member” means an individual who has been been has who individual an means member” “professional Secretaries Act,1980(56of1980);and Institute constitutedundertheofCompany “Institute ofCompanySecretariesIndia”meansthe 1959 (23of1959); constituted undertheCostandWorksAccountantsAct, Advocates Act,1961(25of1961); “Bar Council”meansaBarCouncilconstitutedunderthe “Institute of Cost Accountants of India” means the Institute “Institute ofCostAccountantsIndia”meanstheInstitute Act, 1949(38of1949); Institute constitutedundertheCharteredAccountants “Institute ofCharteredAccountantsIndia”meansthe (31 of2016); “Code” means the Insolvency and Bankruptcy Code, 2016 the CodereadwiththeseRegulations; registration grantedbytheBoardundersection207of

Regulations, 2016 of India(InsolvencyProfessionals) Insolvency andBankruptcyBoard and registration INSOLVENCY EXAMINATIONS not defined of shall CHAPTER II CHAPTER I GENERAL registration” I DECEMBER 2016 be in valid these from Regulations, means

[insert (Name andDesignation) a

start Dr. M.S.SAHOO certificate shall

date]

Chairperson have

to of [insert

the

c does (c) 4. Eligibility.

or 6. Application forcertificateofregistration. has (b) competence,includingfinancialsolvencyandnetworth. 5. (iii) Qualifications andexperience. heisnotafitandproperperson; (g)

(b) (a) professional ifhe- No individualshallbeeligibletoregisteredasaninsolvency examination. (3) (2) (d)

a (1) (a) shall beeligibleforregistration,ifhe- Subject totheotherprovisionsoftheseRegulations,anindividual (ii) (i) criteria- consideration under these Regulations, the Board may take account of any Explanation: (f) (e) (c) REGISTRATION OFINSOLVENCYPROFESSIONALS is notapersonresidentinIndia; is aminor; the websiteofBoardatleastonemonthbefore Examination’, including qualifying marks, shall be published on The syllabus,formatandfrequencyofthe‘LimitedInsolvency areas ofinsolvency,bankruptcyandalliedsubjects. knowledge andapplicationofindividualsinthe agency, conducta‘LimitedInsolvencyExamination’totestthe The Boardshall,eitheronitsownorthroughadesignated of insolvency,bankruptcyandalliedsubjects. the knowledgeandpracticalskillsofindividualsinareas has beenconvictedbyanycompetentcourtforanoffence Regulation 5or9,asthecasemaybe; punishable with imprisonment for a term exceeding six months agency, conduct a ‘National Insolvency Examination’ in such along withanon-refundableapplication feeoftenthousand Board inForm Aof the Second Schedule to these Regulations, as aprofessionalmembermaymake anapplicationtothe An individualenrolledwithaninsolvency professionalagency (iv) (iii) has passedtheNationalInsolvencyExamination; absence ofconvictionsandrestraintorders, integrity, reputationandcharacter, he hasbeendeclaredtobeofunsoundmind;or adjudicated asaninsolvent; he isanundischargedinsolvent,orhasappliedtobe of sevenyearsormore,heshallnotbeeligibletoregistered; and sentencedinrespectthereoftoimprisonmentforaperiod Provided that if a personhas been convicted of any offence years hasnotelapsedfromthedateofexpirysentence: years ofexperiencein management, after hereceived a (ii) (i) years ofexperienceas- has passedtheLimitedInsolvencyExaminationandten by law;or Bachelor’s degreefromauniversityestablishedorrecognized manner

for passed an advocateenrolledwithaBarCouncil. of CostAccountantsIndia,or a costaccountantenrolledasmemberoftheInstitute of CompanySecretariesIndia, a company secretary enrolledas amember of the Institute Institute ofCharteredAccountantsIndia, a charteredaccountantenrolledasmemberofthe an not For as offence have and it determining the deems at Limited the involving such CHAPTER III fit, qualification frequency, including Insolvency whether moral but turpitude, an and Examination, as individual not may experience limited be and specified, is to

a and fit period the specified and has 95 following proper to fifteen of test five in

FROM THE GOVERNMENT FROM THE GOVERNMENT 8. Refusal tograntcertificate.

h abide (h)

yearsaftertheyearinwhichcertificateisgranted; 96 authorised clarificationthatitdeemsfit. c pay (c) documents, these IftheBoardissatisfied,aftersuchinspection orinquiryasit (1) 7. Certificate ofregistration. (1)

(3) documents,

enableittoformafinalopinion. (2) the

(4) (3) (2) (2)

If, after considering an application made under Regulation 6, the Board is of the prima facie opinion that the registration ought not be granted, it shallcommunicatethereasonsfor forming suchanopinionandgivetheapplicantopportunity excluding the time given by the Board for presenting additional under sub-regulation(1),theBoard shallcommunicateits After considering the explanation, if any, given by the applicant as thecasemaybe. decision to- (g) (f) days of the receipt of the communication from the Board, to The communicationundersub-regulation(1)shallbemadeto (e) (d) professional inFormBoftheSecondScheduletothese the applicanttocarryonactivitiesofaninsolvency reasonable time,beforetheBoardinperson,orthroughhis The Boardmayrequiretheapplicanttoappear,within reasonable time,additionaldocuments,informationor The Boardmayrequiretheapplicanttosubmit,within Regulation withinsevendaysofitsreceipt. The Boardshallacknowledgeanapplicationmadeunderthis rupees totheBoard. (b) (a) insolvency professionalshall- The registrationshallbesubjecttotheconditionsthat as thecasemaybe. excluding the time given by the Board for presentingadditional Regulations, withinsixtydaysofreceipttheapplication, deems necessarythattheapplicantiseligibleunder processing theapplication. explain

applicant (i) Schedule totheseRegulations;and take priorpermissionoftheBoardforshiftinghis completion ofsuchassignment; under theCodeforatleastthreeyearsfrom maintain records of all assignments undertaken by him take adequatestepsforredressalofgrievances; agencies; objection fromboththeconcernedinsolvencyprofessional professional agency to another, after receiving no professional membershipfromoneinsolvency Regulation 13,ifheisnotacitizenofIndia; professional entityrecognisedbytheBoardunder he becomesapartnerordirectorofaninsolvency not render services as an insolvency professional unless Regulation 4; at alltimescontinuetosatisfytherequirementsunder professional agencywithwhichheisenrolled; guidelines thereunderandthebye-lawsofinsolvency at alltimesabidebytheCode,rules,regulations,and Regulations, a why by theBoard. abide bysuchotherconditionsasmaybeimposed fee representative information information by within his of the ten application forty it Code thousand may or or five clarifications, clarification, grant of for days should Conduct clarifications rupees a of certificate be receipt to or accepted, or specified the appearing appearing of required Board, of the registration within in application, in every in the for person, person, fifteen First

five to

11. Disciplinary proceedings. hasbeen‘inpractice’forfifteenyearsas- (a) 9. Registration foralimitedperiod. accepttheapplication,alongwithcertificateof (a) 10. (1) An insolvency professional agency shall inform the Board if any of Temporary surrender. TEMPORARY SURRENDERANDDISCIPLINARYPROCEEDINGS

(1) (2) professional. under section 220, it shall issue ashow-cause notice to the insolvency facie material otherwise available on record, if the Board is of the prima regulation (1). (2) The Board shall take note of the information received under sub- application fortemporarysurrenderorrevival,asthecasemaybe. temporary surrender, not later than seven days from approval of the of membershiporrevivedhiscertificateafter deemed tobevalidforthislimitedpurpose. before the expiry of his registration, and his registration shall be Provided that hemaycomplete the pendingassignments undertaken (4) (3) (2) (1) application its

professional

Based (e) (d) (c) (b) (a) opinion The show-causenoticeshallbeinwriting,andstate- professional aftertheexpiryofhisregistration: shall not undertake any assignment asaninsolvency An insolvencyprofessional registered undersub-regulation (3) period ofsixmonthsfromthedatesuchsubmission. the Boardundersub-regulation(2),whichshallbevalidfora for a limited period upon submission of the details and fee to An individualreferredtosub-regulation(1)shallberegistered under sub-regulation(1)(b). the feecollectedanddetailsofapplicationsreceived The insolvencyprofessionalagencyshallsubmittotheBoard as aninsolvencyprofessionalifhe- individual shall be eligible to be registered for a limited period Notwithstanding any of the provisions of Regulation 5, an (b) (b)

the detailsofevidenceinsupport oftheallegedfacts; the detailsofallegedfacts; or issueiftheallegationsareestablished; the actionsordirectionsthatBoard proposestotake public interestisallegedlyaffected; thereunder allegedlyviolated,orthe mannerinwhichthe the provisionsof the Code, rules, regulations and guidelines the provisions of the Code under which it has been issued; on behalf oftheBoard. collected bysuchinsolvencyprofessionalagencyon (iii) (ii) (i) within thirtydaysofreceipttheexplanation. reject theapplicationbyanorder,givingreasonsthereof, 31st December,2016alongwithanon-refundable professional agencywithwhichheisenrolledonorbefore Second ScheduletotheseRegulations the insolvency submits anapplicationforregistrationinFormAofthe (iv) registration, or that the

members Institute ofCompanySecretariesIndia, a companysecretaryenrolledasmemberofthe Institute ofCharteredAccountantsIndia, a chartered accountant enrolled as a member of the a costaccountantenrolledasmemberofthe an advocateenrolledwithaBarCouncil;and Institute ofCostAccountantsIndia,or DECEMBER 2016 sufficient findings fee CHAPTER IV has

of of cause

temporarily an five inspection exists I thousand CHARTERED SECRETARY to surrendered take or rupees

investigation, actions which his permissible certificate shall

on be

CHARTERED SECRETARY I DECEMBER 2016 97 96 DECEMBER 2016 I CHARTERED SECRETARY A 12. (1) Recognition ofInsolvencyProfessionalEntities. RECOGNITION OFINSOLVENCYPROFESSIONALENTITIES (10) Theorderpassedundersub-regulation(7)shallbeissuedtothe 13. (1)

published onthewebsiteofBoard. professional agency with which he is enrolled immediately, and be insolvency professional, with a copy issued to the insolvency (9) (8) (7) (6) (5) (4) (3) (2)

CHARTERED SECRETARY

(a) a majority of the partners of the limited liability partnership the orderalongwithreasonforsame. the orderunlessDisciplinaryCommitteestatesotherwisein effective untilthirtydayshaveelapsedfromthedateofissue The orderpassedundersub-regulation(7)shallnotbecome (d) (c) (b) (a) The orderdisposingofashow-causenoticemayprovidefor- on record. the relevantmaterialfactsandcircumstances, the submissions,ifany,madebyinsolvencyprofessional, adherence toprinciplesofnaturaljustice,andafterconsidering orderin assignedundersub-regulation(5)byareasoned notice The Disciplinary Committee shall dispose of the show-cause assignment. the show-cause notice within a period of six months of the of dispose to endeavour shall Committee Disciplinary The of theshow-causenotice. The Boardshallconstitute aDisciplinaryCommittee for disposal (b) (a) professional inthefollowingmanner- A show-causenoticeissuedshallbeservedontheinsolvency investigation orinspection,otherrecords. relied uponandextractsofrelevantportionsfromthereport The show-cause notice shall enclose copies of documents (h) (g) (f) Regulations. to theBoardinFormCof Second Scheduletothese application for recognition as an insolvency professional entity A personeligibleundersub-regulation (1)maymakean (b) a majority of the whole-time directors of the company are as it deems necessary that the applicant is eligible under eligible is applicant the that necessary deems it as a companymayberecognisedasaninsolvency professional entityif- If theBoardissatisfied,aftersuch inspectionorinquiry

limited

or 220(5). a referencetotheBoardtakeanyactionundersection any oftheactionsundersection220(2)to(4);or warning; no action; enrolled. by the insolvency professional agency with which he is of theinsolvencyprofessional,providedbyhimor by anappropriateelectronicmeanstotheemailaddress acknowledgement due;or agency withwhichheisenrolled,byregisteredpost provided byhimortheinsolvencyprofessional by sending it to the insolvency professional, at the address notice. procedure tobefollowedfordisposaloftheshow-cause notice; and consequences of failure to respond to the show-cause to respondtheshow-causenotice; the manner in which the insolvency professional is required registered asinsolvency professionals, as the case may be. professionals; or registered liability partnership, partnership CHAPTER V I DECEMBER 2016 firm a registered are registered partnership as insolvency firm or

8. 7. 6. 5. Independence andimpartiality. 4. 3. 2. 1. Integrity andobjectivity. CODE OF CONDUCT FOR INSOLVENCY PROFESSIONALS 14.

Where passing areasonedorder. de-recognition ofaninsolvencyprofessionalentity,itmaydosoby party, whether directly connected to the insolvency proceedings or not. concerned corporateperson/debtor assoonhebecomesaware entitled todistributionundersections 53or178oftheCode,and pecuniary or personal relationship with any of the stakeholders An insolvencyprofessionalshall disclosetheexistenceofany debtor anditsrelatedparties. the processesunderCode,inrelationtocorporateperson/ or director is not independent, in terms of the Regulations related to director, ortheinsolvencyprofessionalentityofwhichheisapartner apartneror heis ofwhich entity of theinsolvencyprofessional the Code if he, any of his relatives, any of the partners or directors An insolvencyprofessionalshallnottakeupanassignmentunder been obtainedinthematter. liquidation orbankruptcyprocessandtheapprovalofBoardhas no impairment of objectivity, independence or impartiality in the whether directly or indirectly unless it is shown that there was that he or his relatives do not knowingly acquire any such assets, a debtorduringliquidationorbankruptcyprocess,hemustensure In cases where the insolvency professional is dealing with assets of independent ofexternalinfluences. resolution, liquidationorbankruptcyprocess,asthecasemaybe, in hisprofessionalrelationshipsandshouldconducttheinsolvency An insolvencyprofessionalmustmaintaincompleteindependence the debtor,norknowinglypermitanyrelativetodoso. should not himself acquire, directly orindirectly,any of theassets of professional, resolution professional, liquidator, orbankruptcy trustee resolution interim an as appointed professional insolvency An would bringdisreputetotheprofession. situations andshouldrefrainfrombeinginvolvedinanyactionthat An insolvency professional must not misrepresent any facts or straightforward, andforthrightinallprofessionalrelationships. An insolvencyprofessionalmustmaintainintegritybybeinghonest, of dealings by ensuring that hisdecisions are made without the presence An insolvencyprofessionalmustactwithobjectivityinhis (3) (2) any

(d) abidebysuchotherconditionsasmaybespecified. (c) informtheBoard,withinsevendays,whenaninsolvency (b) informtheBoard,withinsevendays,whenaninsolvency (a) atalltimes continue to satisfy the requirementsunder or directorship. insolvency professionalscommittedduringsuchpartnership liable forallactsoromissionsofitspartnersdirectorsas An insolvencyprofessionalentityshallbejointlyandseverally insolvency professionalentityshall- The recognition shall be subject to the conditions that the these Schedule totheseRegulations. as aninsolvencyprofessionalentityinFormDoftheSecond the bias, may be,and professional joins as its director or partner, as the case case maybe, professional ceases to be its director or partner, as the Regulation 12; Board Regulations, conflict [Under Regulation7(2)(g)] is

of of FIRST SCHEDULE

interest, the it opinion may coercion, grant that

a sufficient or certificate undue

cause influence of recognition 97 exists of

any for

FROM THE GOVERNMENT FROM THE GOVERNMENT 98 15. An insolvency professional must make efforts to ensure that all that effortstoensure make must professional insolvency An 15. Information management. 14. 13. Timeliness. 12. 11. Representation ofcorrectfactsandcorrectingmisapprehensions. 10. Professional competence. 9. An 21. Confidentiality. 20. 19. 18. 17. 16. Aninsolvencyprofessionalmustensurethathemaintainswritten 22. Occupation, employabilityandrestrictions.

reports, communication tothestakeholders,whetherinformofnotices, while performinghisfunctionsanddutiesundertheCode. of hisduties. communicate withallstakeholdersinvolvedforthetimelydischarge promptly and actions, his plan carefully must and be, may case for insolvencyresolution,liquidationorbankruptcyprocess,asthe in the Code and the rules, regulations and guidelines thereunder An insolvencyprofessionalmustadheretothetimelimitsprescribed Adjudicating Authorityoranystakeholder,asapplicable. or knowingly make amisleading statement to the Board, the An insolvency professional must not conceal any material information of afact of which hebecomes aware, as soon as may bepracticable. as mayberequired,ofamisapprehensionorwrongfulconsideration An insolvencyprofessional must inform suchpersonsunderthe Code service. professional knowledge and skills to render competent professional An insolvency professional must maintain andupgradehis or impropermeanstoachieveanymalafideobjectives. persons forundueorunlawfulgainsandshallnotadoptanyillegal or hisrelatedparties,causeanyunduepreferenceforother the Code,soastomakeanyundueorunlawfulgainsforhimself of thecommitteecreditorsordebtor,otherstakeholdersunder of creditors,andthepersonproposingappointment,asapplicable. of it,bymakingadeclarationthesame to theapplicant,committee for anyperiodicstudy,researchandauditconductedbytheBoard. An insolvency professional must beavailable andprovide information agency withwhichheisenrolled. as may be required by the Board or the insolvency professional An insolvencyprofessionalmustprovideallinformationandrecords with whichheisenrolled. agency professional insolvency the or theBoard by authorised person any Board, the by out carried investigations and inspections for An insolvencyprofessionalmustappear,co-operateandbeavailable Authority. regulations and guidelines thereunder, or orders of the Adjudicating with anyofthestakeholdersunlessrequiredbyCode,rules, An insolvencyprofessionalmustnotmakeanyprivatecommunication decisions andactions. a reasonable person to take a view on the appropriateness of his such taking the decision, and the information and evidence in support of contemporaneous recordsforanydecisiontaken,thereasons the recipients. and inamannerwhichissimple,clear,easilyunderstoodby assignments, if he is unlikely to be able to devote adequate time to An insolvencyprofessionalmust refrain fromacceptingtoomany with theconsentofrelevantpartiesorrequiredbylaw. However, thisshallnotpreventhimfromdisclosinganyinformation or bankruptcy process, asthe casemaybe, ismaintained at alltimes. information relating to the insolvency resolution process, liquidation insolvency insolvency insolvency decision. updates,

professional professional This professional directions, shall be shall must or must maintained clarifications,

not not ensure influence

act

with so that mala as is the made to confidentiality decision fide sufficiently well

be in or negligent advance the enable of work the

Sir/Madam, insolvency professionalforlimitedperiod Subject: Applicationforregistrationasaninsolvencyprofessional/ Insolvency andBankruptcyBoardofIndia The Chairperson To 29. 28. Gifts andhospitality. 27. A. My detailsareasunder: (b) (a) hereby applyforregistrationas (please writethenameofagency), the insolvencyprofessional I, havingbeenenrolledasaprofessionalmemberwiththe 24. 23. 25. Remuneration andcosts. 26. 26. [Under Regulation6or9oftheInsolvencyandBankruptcy

retain anadvantageintheconductofprofessionforhimself. person, intending to obtain or retain work for himself, or to obtain or financial An insolvencyprofessionalshallnotoffergiftsorhospitalitya insolvency professional. hospitality whichunderminesoraffectshisindependenceasan An insolvencyprofessional, or hisrelative must not accept gifts or 10. 9. 8. 7. 6. 5. 4. 3. 2. 1. PERSONAL DETAILS such costsarenotunreasonable. to ensurethat relevant stakeholders,andmustendeavour or costsofthebankruptcyprocess,asapplicable,toall costs, process costs,liquidation resolution the insolvency shall discloseallcosts An insolvencyprofessionaltowards Regulations, 2016. and BankruptcyBoardof India (InsolvencyProfessionals) 2016 readwithRegulation 6orRegulation9oftheInsolvency under section207of the Insolvency andBankruptcyCode, is notapplicable) an insolvency professional for limited period(strike off which an insolvencyprofessional/ is registered. membership withtheinsolvencyprofessionalagencywhichhe except whenhehastemporarilysurrenderedhiscertificateof An insolvency professional must not engage in any employment, each ofhisassignments. which An insolvency professional must provide services for remuneration profession. the opinionofBoardisinconsistentwithreputation An insolvencyprofessionalmustnotconductbusinesswhichin with theapplicableregulations. the worknecessarilyandproperlyundertaken, andisnot inconsistent than An insolvencyprofessionalshallnotacceptanyfeesorchargesother his remuneration. Board ofIndia(InsolvencyProfessionals)Regulations,2016] those Permanent Address: Address forCorrespondence: Passport No.: AADHAAR No.: PAN No.: Place ofBirth: Date ofBirth: Father’s Name: Name: Title (Mr/Mrs/Ms): is

charged or which any in DECEMBER 2016 other are a SECOND SCHEDULE transparent disclosed advantage FORM A to

manner, and I to CHARTERED SECRETARY a approved public

a reasonable servant by

the persons or reflection any

fixing other of

CHARTERED SECRETARY I DECEMBER 2016 99 98 DECEMBER 2016 I CHARTERED SECRETARY C. 3. 2. ProfessionalQualifications degree onwards] [Please provide educational qualifications from Bachelor’s F. ATTACHMENTS 4. 3. E. D. 1. EducationalQualifications B. No. Qualification Professional Sl. Qualification Educational

5. 4. 3. 2. 1. WORK EXPERIENCE 3. 2.HaveyoupassedNationalInsolvencyExamination?(Yes/No) 3. 1. Have you passed Limited Insolvency Examination? (Yes / No) Insolvency Qualifications 3. Copies 2. 1. your application. Please provideanyadditionalinformationthatmayberelevantfor If yes,pleasegivedetails. applied tobedeclaredso?(Yes/No) Have you ever been declared as an undischarged insolvent, or If yes,pleasegivedetails. 2. 1. ADDITIONAL INFORMATION 2. 1. INSOLVENCY PROFESSIONALAGENCY EXAMINATION QUALIFICATIONS EDUCATIONAL, PROFESSIONALANDINSOLVENCY 12. 11. From From Date CHARTERED SECRETARY

Bachelors’ Degree) Chartered Accountant / Company Secretary / Cost Accountant/ Experience Details (from the date of enrolment as Advocate / Number ofyearsinemployment(inandmonths): If inpractice,addressforprofessionalcorrespondence: Number ofyearsinpractice(inandmonths): Are youpresentlyinpractice/employment?(Yes/No) i. Copies ofdocumentsdemonstrating practiceas- qualifications. professional qualification and insolvency examination Copy ofproofresidence. Are anycriminalproceedingspendingagainstyou?(Yes/No) If yes,pleasegivedetails. Haveyoueverbeenconvictedforanoffence?Yes/No. Please stateyourprofessionalmembershipnumber. which youareenrolledasaprofessionalmember. Please givedetailsoftheinsolvencyprofessionalagencywith Mobile No.: E-Mail Address:

Date To Professional Body a charteredaccountantenrolled withtheInstituteof Passing Year of Institute / of Employment/ Practice documents Marks (%) Membership No. (if applicable) I Designation in DECEMBER 2016 employed, Employer Name of support and If Grade/ Class of Secretary / Cost If inpractice, educational Accountant Accountant / Company practice as Advocate / Chartered enrolment University/ Date of College Remarks, ifany qualifications, Remarks, if Area of work any professional. true andcorrect.Werecommendregistrationof…asaninsolvency member 1. (Insolvency Professionals)Regulations, 2016] [Under Regulation7oftheInsolvency andBankruptcyBoardofIndia IP REGISTRATIONNO.__ Date: Place: We VERIFICATION BYTHEINSOLVENCYPROFESSIONALAGENCY Date: Place: G. AFFIRMATIONS

have In exercise of the powers conferred by Regulation 7 of the 5. 4. 3. I 2. 1. Evidence 8. 7. 6. 5. 4. Authorised RepresentativeoftheInsolvencyProfessionalAgency

Copies INSOLVENCY ANDBANKRUPTCYBOARDOFINDIA with verified The applicablefeehasbeenpaid. the GoverningBoardofsuchinsolvencyprofessionalagency. the resolutionspassedanddirectionsgivenbyBoard insolvency professionalagencywithwhichIamenrolled,and and guidelinesissued thereunder, the bye-laws of the Insolvency andBankruptcyCode,2016,therules,regulations I herebyundertaketocomplywiththerequirementsof be summarilycancelled. shall period limited registrationfor at anystage,myregistration/ this applicationistrueandcomplete.Iffoundfalseormisleading This application and the information furnished by me along with India (InsolvencyProfessionals)Regulations,2016. professional undertheInsolvencyandBankruptcyBoardof called for. I undertaketofurnishanyadditionalinformationasandwhen uploaded are…… form have been attached/ uploaded. The documents attached/ Copies ofdocuments,aslistedinsectionFthisapplication thousand rupees,asapplicable. Passport-size photo. insolvency professionalagency. Copy ofcertificateprofessionalmembershipwithan years. Financial statement/IncomeTaxReturnsforthelastthree specifying theperiodofsuchemployment. iv. iii. ii. am

professional Chartered AccountantsofIndia; India; an advocateenrolledwiththeBarCouncilofanyStatein Accountants ofIndia;or Cost of Institute the with enrolled accountant cost a Secretaries ofIndia; a company secretary enrolled with the Institute of Company not the

CERTIFICATE OFREGISTRATION of disqualified of

above certificate deposit SECOND SCHEDULE details membership Seal oftheInsolvencyProfessionalAgency / FORM B from of payment submitted

employment being Name andSignatureofapplicant no. of registered by … five … and

from thousand who (Name andSignature) confirm

is the as our an employer(s), rupees professional these insolvency 99 to / ten be

FROM THE GOVERNMENT FROM THE GOVERNMENT I, 2. 1. Sir/Madam, Sub.: Applicationforrecognitionasaninsolvencyprofessionalentity Insolvency andBankruptcyBoardofIndia The Chairperson To (Insolvency Professionals)Regulations,2016] [Under Regulation12oftheInsolvencyandBankruptcyBoardIndia 1. Pleasestatethe detailsofalldirectors/partners of theapplicant: 5. 4. CorporateIdentificationNumber(CIN)/Certificate ofRegistration: 3. 100 Thiscertificateshallbevalidfrom[insertstartdate]. 2. Date: Place: 2. 1. Date : Place : 4. I,onbehalfof[insertname],herebyaffirmthat– 3.

with theBoardinthisrespect. proof thatIamauthorizedtomakethisapplicationandcorrespond India (InsolvencyProfessionals)Regulations,2016,andenclose professional entityundertheInsolvencyandBankruptcyBoardof [name andaddressoftheapplicant]forrecognitionasaninsolvency I, beingdulyauthorizedforthepurpose,herebyapplyonbehalfof make thisapplicationandcorrespond withtheBoardinthisrespect: Name, designation and contact details of the person authorized to PAN: Regulations, Insolvency andBankruptcy BoardofIndia (InsolvencyProfessionals) with theseRegulations. to [insert name], to act as an insolvency professional in accordance Address Name oftheapplicant: recognition orsubsequently. as guidelines issuedthereunder,andsuchothertermsconditions comply with the requirements of the Code, the rules, regulations or If grantedrecognition,I,onbehalfof[insertname],undertaketo iii. ii. i. recognised asaninsolvencyprofessionalentity.

may For andonbehalfofInsolvencyBankruptcyBoardIndia behalf to befalseormisleadinginmaterialrespectsatanystage. cancelled summarilyifanyinformationsubmittedhereinisfound recognition granted in pursuance of this application may be application hasbeensuppressed,and no materialinformationrelevantforthepurposeofthis in allmaterialrespects, all informationcontainedinthisapplicationistrueandcorrect

of be

registered of imposed 2016 [insert DIRECTORS/ PARTNERS ANNEXURE TOFORMC the SECOND SCHEDULE office name], by Board the and GENERAL FORM C PART II PART I hereby affirm Board principal that while grants place the granting a of (Name andDesignation) applicant certificate

business Authorized Signatory the Yours faithfully, is

(Designation) of eligible

certificate the registration applicant: (Name) to Sd/- be of

09 1. (Insolvency Professionals)Regulations,2016] [Under Regulation13oftheInsolvencyandBankruptcyBoardIndia Date : Place : 2. 1. Regulations, namely- the InsolvencyandBankruptcyBoardofIndiaherebymakesfollowing section 240oftheInsolvencyandBankruptcyCode,2016(312016), sections 5,7,9,14,15,17,18,21,24,25,29,30,196and208read with IBBI/2016-17/GN/REG004 G.O.I. Part-IIISection-4dated30.11.2016] [Issued bytheInsolvencyandBankruptcyBoardofIndia.Publishedin Date: Place: Thiscertificateofrecognitionshallbevalidfrom[insertstartdate]. 2. No. Sl.

INSOLVENCY PROFESSIONALENTITYRECOGNITIONNO.__ Regulations, Insolvency andBankruptcy BoardofIndia (InsolvencyProfessionals) In exerciseofthepowersconferredbyRegulation13 (1) Definitions. (3) (2) (1) Short titleandcommencement. [insert name],asaninsolvencyprofessionalentity. director/ partner Address ofthe

INSOLVENCY ANDBANKRUPTCYBOARDOFINDIA Name and For andonbehalfofInsolvencyBankruptcyBoardIndia In theseRegulations,unlessthecontext otherwiserequires- resolution process. These Regulationsshallapplyto thecorporateinsolvency These Regulationsshallcomeintoforce on 1st December,2016. Persons) Regulations,2016. Board ofIndia(InsolvencyResolutionProcessforCorporate These RegulationsmaybecalledtheInsolvency andBankruptcy

I Regulations, 2016 Process ForCorporatePersons) Of India(InsolvencyResolution nsolvency andBankruptcyBoard 2016 CERTIFICATE OFRECOGNITION DECEMBER 2016 DIN the SECOND SCHEDULE Board In exerciseofthepowersconferredunder PRELIMINARY PAN CHAPTER I FORM D hereby as aninsolvency Registration No. Professional I CHARTERED SECRETARY grants (Name andDesignation) a certificate Authorized Signatory DR. M.S.SAHOO, Membership No. Yours faithfully, Professional (Designation) Chairperson recognising (Name) Sd/- CHARTERED SECRETARY I DECEMBER 2016 101 100 DECEMBER 2016 I CHARTERED SECRETARY 3. (2) a “applicant” (a) f “dissenting (f) (e) (d) (c) (b) “identification (i) (h) (g) (c) (b) (a) corporate debtor,ifhe: Explanation– A person shall be considered independent of the (1) Eligibility forresolutionprofessional. have themeaningsassignedtotheminCode. and Unless thecontextotherwiserequires,wordsandexpressionsused (p) (o) (n) (m) (l) (k) (j) CHARTERED SECRETARY

not Chapter IIofParttheCode; insolvency resolutionprocessforcorporatepersonsunder “corporate insolvencyresolutionprocess”meansthe section 21; “committee” means a committee of creditors established under of India(InsolvencyProfessionals)Regulations,2016; professionals assetoutintheInsolvencyandBankruptcyBoard “Code ofConduct”meansthecodeconductforinsolvency “Code” meanstheInsolvencyandBankruptcyCode,2016; sections 7,9or10,asthecasemaybe; of suchcommunication. mail addressprovidedbysuchparticipantandkeepingrecord entitled toreceivesuchcommunicationatthelastelectronic confirmation ofsendingcommunicationtotheparticipant computer programmewhichiscapableofproducing “electronic means”meananauthorizedandsecured Information TechnologyAct,2000(21of2000); “electronic form”shallhavethemeaningassignedtoitin voted againsttheresolutionplanapprovedbycommittee; is notanemployeeorproprietor apartner: is notarelatedpartyofthecorporate debtor;or is acompany; Companies Act, 2013 (18 of 2013), where the corporate debtor the boardof the corporate debtor under section 149of the is eligibletobeappointedasanindependentdirectoron director, areindependentofthecorporatedebtor. of theinsolvencyprofessionalentitywhichheisapartneror process ofacorporatedebtorifhe,andallpartnersdirectors a resolutionprofessionalforcorporateinsolvency An insolvency professional shall be eligible to be appointed as to participateeffectivelyinthemeeting. in ameetingtocommunicateconcurrentlywithone another and such audio and visual facility which enables the participants “video conferencing or other audio and visual means” means “section” meanssectionoftheCode; “Schedule” meansthescheduletotheseRegulations; rules madethereunder; accordance withtheCompaniesAct,2013(18of2013)and “registered valuer”meansapersonregisteredassuchin the committeetoattendmeeting; committee under section 24 orany other person authorised by “participant” meansapersonentitledtoattendmeetingofthe with Regulation35; “liquidation value” means the amount determined in accordance (Insolvency Professionals)Regulations,2016; as suchundertheInsolvencyandBankruptcyBoardofIndia “insolvency professionalentity”meansanentityrecognised the casemaybe; Identification defined in financial means these number” Number CHAPTER II Regulations, the creditors” GENERAL I DECEMBER 2016 means or person(s) the means the Corporate but Limited filing defined the financial an Identity Liability application in the creditors Number, Partnership Code, under shall who as

6. 5. 4. (2) Thepublicannouncementreferredtoinsub-regulation(1)shall: (1) Public announcement. (2) (1) where theterms: A transactionshallbeconsideredextortionateundersection50(2) Extortionate credittransaction. (1) Access tobooks. (3) (2)

i of (i) (b) (a) the dateofhisappointment. from days three than later not means ‘Immediately’ Explanation: professional. immediately onhisappointmentasaninterimresolution An insolvencyprofessionalshallmakeapublicannouncement contracts. are unconscionableundertheprinciplesoflawrelatingto respect ofthecreditprovided;or require thecorporatedebtortomakeexorbitantpaymentsin (f) (e) (d) (c) (b) (a) debtor heldwith- for discharginghisdutiesundertheCode,ofcorporate other relevant documents andinformation, to the extent relevant professional mayaccessthebooksofaccount,recordsand Without prejudice to section 17(2)(d), the interim resolution process. other stakeholdersinthesamecorporateinsolvencyresolution of such insolvency professional entity represents any of the insolvency professionalentityoranyotherpartnerdirector professional inacorporateinsolvencyresolutionprocessifthe insolvency professionalentity,shallnotcontinueasaresolution A resolutionprofessional,whoisadirectororpartnerofan Conduct. his appointmentandthereafterinaccordancewiththeCodeof inthelastthreefinancialyears. A resolution professional shall make disclosures at the time of (ii) (c)

(i) be published- be inFormAoftheSchedule; contractual counterpartiesofthecorporatedebtor. other registriesthatrecordstheownershipofassets; information utilities; professional advisorsofthecorporatedebtor; depositories ofsecurities; venture partnersofthecorporatedebtor;and members, promoters, partners, boardof directors andjoint cent ormoreofthegrossturnoversuchfirm, transaction withthecorporatedebtoramountingtotenper of alegalorconsultingfirm,thathashadany cost auditorsofthecorporatedebtor;or of theinterimresolutionprofessional. which shallbefourteendaysfrom the dateofappointment provide thelastdateforsubmission ofproofsclaim, (iii) (ii)

a firm office with widecirculationatthelocationofregistered in one English and one regional language newspaper the purpose, on the website, if any, designated by the Board for on thewebsite,ifany,ofcorporatedebtor;and debtor conductsmaterialbusinessoperations; of theinterimresolutionprofessional,corporate debtor andanyotherlocationwhereintheopinion PUBLIC ANNOUNCEMENT of auditors and CHAPTER III principal or company office, secretaries if any, of 101 the in practice corporate or

FROM THE GOVERNMENT FROM THE GOVERNMENT 102 8. 7. 9. 1 A (1) Claims byfinancialcreditors. (2) (1) Claims byoperationalcreditors. form partofinsolvencyresolutionprocesscosts. not shall announcement public the on expenses The Clarification- (3) 2 The (2)

(1) Claims byworkmenandemployees. (3) (2)

(b) (a) Regulation maybeprovedonthebasisof- The existenceofdebt due to the operational creditorunderthis constitution ofthecommittee. documents Provided by postorelectronicmeansinFormBoftheSchedule: proof of claim to the interim resolution professional in person, workman or employee of the corporate debtor, shall submit A personclaimingtobeanoperationalcreditor,otherthan ratifies them. which may be reimbursed by the committee to the extent it The applicant shall bear the expenses of the public announcement constitution ofthecommittee. documents Provided thatsuchpersonmaysubmitsupplementary professional inelectronicformFormCoftheSchedule: debtor shall submit proof of claim to the interim resolution documents Provided thatsuchpersonmaysubmitsupplementary in FormDoftheSchedule: resolution professionalinperson,bypostorelectronicmeans corporate debtor shall submit proof of claim to the interim ofthe oranemployee workman tobea A personclaiming (b) (a) on thebasisof- The existence of dues to workmen or employees may beproved the Schedule. one proofofclaimforallsuchdues ontheirbehalfinFormEof the corporatedebtor,anauthorised representativemaysubmit Where thereareduestonumerousworkmenoremployeesof constitution ofthecommittee. or if required by the interim resolution professional, before the person existence i) financialaccounts. (iv) (iii) (ii) (i) other relevantdocuments,including- the recordsavailablewithaninformationutility,ifany;or (ii) i a (i) other relevantdocuments,including- the recordsavailablewithaninformationutility,ifany;or ii financial (iii) (iv)

upon thenon-paymentofadebt,ifany;or an orderofacourtortribunalthathasadjudicated services suppliedtothecorporatedebtor; an invoice demandingpayment for the goods and corporate debtor; a contractforthesupplyofgoodsandserviceswith the a recordevidencingthattheamountscommittedby as evidenceofthedebt; facility hasbeendrawnbythecorporatedebtor; upon thenon-paymentofadebt,ifany. an orderofacourtortribunalthathasadjudicated been repaid;or claiming that suchpersonmaysubmitsupplementary financial or or or financial of clarifications clarifications clarifications PROOF OFCLAIMS debt statements CHAPTER IV to contract due be creditor to a in the financial in in supported support support support to showing financial the corporate creditor of of of by creditor that the the the financial claim, the claim claim of debtor may the debt statements on before before be corporate his has under proved own the the not a

10. 12. A creditorshallbearthecostofprovingdebtduetosuchcreditor. 11. 15. 14. 13. the The interimresolutionprofessionalortheprofessional,as Substantiation ofclaims. he 3 Where (3) (2) (1) Submission ofproofclaims. Cost ofproof. claim. Indian The claimsdenominatedinforeigncurrencyshallbevalued Debt inforeigncurrency. (2) (1) Determination ofamountclaim. (2) (1) Verification ofclaims.

deems

case (b) (a) by them,individuallyorcollectivelyonthebasisof- committee. as thecasemaybe,tillapprovalofaresolutionplanby the interim resolution professional or the resolution professional, stipulated inthepublicannouncement,maysubmitsuchproofto A creditor, who failed to submit proof of claim within the time announcement. of claimonorbeforethelastdatementionedinpublic Subject tosub-regulation(2),acreditorshallsubmitproof additional informationwarrantingsuchrevision. (1), assoonmaybepracticable,whenhecomesacross including theestimatesofclaimsmadeundersub-regulation as the casemaybe, shallrevisethe amounts of claimsadmitted, The interim resolution professional or the resolution professional, information availablewithhim. the bestestimateofamountclaimbasedon or theresolutionprofessional,ascasemaybe,shallmake contingency orother reason, the interim resolution professional Where theamount claimed bya creditor is not precisedue to any presentedatthefirstmeetingofcommittee. (e) filedwiththeAdjudicatingAuthority;and (d) (c) (b) (a) The listofcreditorsshallbe– interest, ifany,inrespectofsuchclaims,andupdateit. by them,theamountoftheirclaimsadmittedandsecurity containing names of creditors along with the amount claimed receipt oftheclaims,andthereuponmaintainalistcreditors commencement date, within seven days from the last date of the as the casemaybe, shallverify everyclaim, asonthe insolvency The interim resolution professional or the resolution professional, decision takenbythecommitteepriortosuchinclusion. Provided thatsuchinclusionshallnotaffectthevalidityofany of suchclaim: shall beincluded in the committee fromthedateofadmission currency

may (iii) (ii) (i) other relevantdocuments,includingrecords availablewithaninformationutility,ifany;or displayed onthewebsite,ifany,ofcorporatedebtor; and guarantorsofthecorporatedebtor; available forinspectionbymembers,partners,directors proofs ofclaim; available for inspection by the persons who submitted fit

the

from be, upon thenon-paymentofadues,ifany. an orderofacourtortribunalthathasadjudicated or employeeisclaimingdues; suchworkman forwhich period forthe employment a proofofemploymentsuchascontract not beenmade;or and any documentary or other proof that payment has evidence ofnoticedemanding payment ofunpaiddues creditor at DECEMBER 2016 may a the creditor call official in sub-regulation for for such exchange substantiating I CHARTERED SECRETARY other evidence (2) rate is the as a financial whole on or the clarification or insolvency creditor, part of as its it CHARTERED SECRETARY I DECEMBER 2016 103 102 DECEMBER 2016 I CHARTERED SECRETARY 16. 19. representing thirtythreepercentofthevotingrights. if a request to that effect is made by members of the committee as and when he considers necessary, and shall convene a meeting A resolution professional may convene a meeting of the committee 18. 17. 1 Where (1) Committee withonlyoperationalcreditors. by theReserveBankofIndiaorderivedfromsuchreferencerates. Explanation - “official exchange rate” is the reference rate published commencement date. (2) (1) Notice formeetingsofthecommittee. Meetings ofthecommittee. 2 The (2) The (1) First meetingofthecommittee. (4) (3) (2) CHARTERED SECRETARY financial The committeemayreducethenotice periodfromsevendays electronic meansinaccordancewith Regulation20. or bypostbutinanyevent,beserved oneveryparticipantby professional and suchnotice may be sent by hand delivery, every participant,attheaddressithasprovidedtoresolution called bygivingnotlessthansevendays’noticeinwritingto Subject tothisRegulation,ameetingofthecommitteeshallbe under thisRegulation. meeting his appointment. Authority on or before the expiry of thirty days from the date of certifying constitution of the committee to the Adjudicating the casemaybe. a shall havethesamerights,powers,dutiesandobligationsas A committee formed under this Regulation and its members (c) (b) (a) debt’ isthesumof- Explanation – For the purposes of this sub-regulation, ‘total be, tothetotaldebt. or debt represented by such representative, as the case may have votingrightsinproportionofthedebtduetosuchcreditor A memberofthecommitteeformedunderthisRegulationshall (c) (b) (a) members asunder- The committee formed under this Regulation shall consist of committee shallbesetupinaccordancewiththisRegulation. committee

sub-regulation 2(c). the amountofaggregatedebtduetoemployeesunder sub-regulation 2(b);and the amountofaggregatedebtduetoworkmenunder regulation 2(a); the amountofdebtduetocreditorslistedinsub- those employeesincludedundersub-clause(a). one representativeelectedbyallemployeesotherthan workmen includedundersub-clause(a);and one representativeelectedbyallworkmenotherthanthose operational creditors; less than eighteen, the committee shallincludeall such Provided eighteen largestoperationalcreditorsbyvalue: interim interim the MEETINGS OFTHECOMMITTEE creditors of COMMITTEE OFCREDITORS corporate the comprising resolution resolution committee that ifthenumberofoperationalcreditorsis are CHAPTER VI CHAPTER V

related debtor I DECEMBER 2016 financial professional within professional has parties seven no creditors of financial the shall days

shall corporate and convene of debt its filing file members, or debtor, the a where the report report first the as all

21. 20. (3) (2) (1) Contents ofthenoticeformeeting. (7) (6) The (5) 4 When (4) (3) (2) (4) (1) Service ofnoticebyelectronicmeans.

(a) The noticeofthemeetingshall- meeting onitsbehalf. the authorisedrepresentativewhowillattendandvoteat of identity ofthe meeting, ofthe advance in professional, Provided that such participant shall inform the resolution authorised representative: attend and voteinthemeetingeitherpersonor through an The noticeofthemeetingshallprovidethataparticipantmay and visualmeans. enable participationthroughvideoconferencingorotheraudio means, andshallalsoprovideallthenecessaryinformationto participate throughvideoconferencingorotheraudioandvisual and dateofthemeetingoptionavailabletothem The noticeshallinformtheparticipantsofvenue,time meeting. of any meeting shall notinvalidate the decisionstaken at such professional, thenon-receiptofsuchnoticebyparticipant provide or update the relevant e-mail address to the resolution If aparticipant,otherthanmemberofthecommittee,failsto or information. of thewebsiteandfulldetailshowtoaccessdocument shall givethecompleteUniformResourceLocatororaddress able toobtainandretaincopiestheresolutionprofessional Resource Locator shallbereadable, andthe recipient shouldbe The noticemadeavailableontheelectroniclinkorUniform responsible forafailureintransmissionbeyonditscontrol. when hetransmits the e-mail andheshall not beheld retained as‘‘proofofsending’’. of anyfailed transmissions andsubsequent re-sendingshallbe notice hasbeensentandcopyofsuchrecordanynotices recipients e-mailed and a record of each recipient to whom the a an e-mail,theresolutionprofessionalshallensurethatituses the software. instructions’ forrecipientdownloadingrelevantversionof Format orinanon-editableformattogetherwith‘link e-mail, such attachment shall be in the Portable Document If noticeissentintheformofanon-editableattachmenttoan meeting isscheduled. debtor, theplace,ifany,timeanddateonwhich The subjectlineine-mailshallstatethenameofcorporate for accessingsuchnotice. The noticeofthemeetingshall- (b) notification through e-mailasatextoranattachmenttoe-mail A noticebyelectronicmeansmaybesenttotheparticipants deems fit. to suchotherperiodofnotlessthantwentyfourhours,asit system

obligation (iii) (ii) (i) contain anagendaofthemeetingwithfollowing- such meeting. be takenatthemeetingunlessallmembersarepresent state that avote of the members of the committee shall not notice

and a listoftheissuestobevoteduponatmeeting; a listofthematterstobediscussedatmeeting; meeting; and be discussed and the issues to be voted upon at the copies ofall documents relevant to the matters to which providing or of notifications produces the electronic resolution confirmation of link availability professional or Uniform of of the notice Resource shall total 103 be are number satisfied Locator sent by of

FROM THE GOVERNMENT FROM THE GOVERNMENT 104 24. 23. 22. (1) Conduct ofmeeting. (4) (3) (2) (1) Participation throughvideoconferencing. (3) (2) (1) Quorum atthemeeting.

The resolution professional shall act as the chairperson of the shall bedeemedtomadeatsuchplace. meeting and all recordings of the proceedings at the meeting shall beinIndia,deemedtotheplaceofsaid meeting assetforthinthenoticeconvening the meeting,which or other audio and visual means, the scheduled venue of the Where ameeting is conducted through video conferencing (f) (e) (d) (c) (b) (a) The resolutionprofessionalshalltakedueandreasonablecare- connection. to ensureuninterruptedandclearvideooraudiovisual The resolution professional shall make necessary arrangements accordance withthisRegulation. through videoconferencingorotheraudioandvisualmeansin provide theparticipantsanoptiontoattendmeeting The noticeconveningthemeetingsofcommitteeshall meeting. be quoratewiththemembersofcommitteeattending accordance with sub-regulation (2), the adjourned meeting shall In the event a meeting of the committee is adjourned in the sametimeandplaceonnextday. otherwise, themeetingshallautomaticallystandadjournedat of quorum, unless the committee has previously decided Where ameetingofthecommitteecouldnotbeheldforwant the committee. rights requiredforquoruminrespectofanyfuturemeetings Provided thatthecommitteemaymodifypercentageofvoting other audioandvisualmeans: rights arepresenteitherinpersonorbyvideoconferencing committee representingatleastthirtythreepercentofthevoting A meeting of the committee shall be quorate if members of the (c) (b) (a)

person toaccompanyhimatthemeeting. make requesttotheresolutionprofessionalallowa Provided that the persons, who are differently abled, may of themeeting: applicable, the other participants clearly during the course audio and visual means are able to hear and see, if to ensure that participants attending the meeting through visual means;and the meeting through videoconferencing orother audioand participants attendsorhasaccesstotheproceedingsof to ensurethatnopersonotherthantheintended part oftherecordscorporatedebtor; recording(s) orotherelectronicrecordingmechanismas to storeforsafekeepingandmarkingthephysical to recordproceedingsandpreparetheminutesofmeeting; participation oftheparticipantsatmeeting; providing transmissionofthecommunicationsforeffective or other audio and visual equipment or facilities for to ensureavailabilityofpropervideoconferencing sufficient securityandidentificationprocedures; to safeguard the integrityof meeting byensuring queries connectedwiththeelectronicvoting. provide contactdetailsofthepersonwhowilladdress of voteinasecuremanner;and generating passwordandforkeepingsecuritycasting forprovide theloginIDanddetailsofafacility during whichthevotesmaybecast: means and the time schedule, including the timeperiod state theprocessandmannerforvotingbyelectronic 25. 26. (2) (5) (4) (3) (2) (1) Voting bythecommittee. (7) (6) (5) (4) (3) (1) Voting throughelectronicmeans.

(f) (e) (d) (c) (b) (a) for therecord,following,- video conferencing or other audio and visual means shall state, shall takearollcallwheneveryparticipantattendingthrough At the commencement of ameeting, the resolution professional meeting ofthecommittee. (b) (a) taken atsuchmeetingandtheresolutionprofessionalshall- be not shall vote a meeting, a at present not are members If all for oragainstthedecision,abstainedfromvoting. with the names of the members of the committee who voted professional shall announce the decision taken on items along At theconclusionofavoteatmeeting,resolution on anyitemlistedforvotingafterdiscussionthesame. professional shall take a vote of the members of the committee Where all members are present in a meeting, the resolution the committee. approval ofthecommitteemaybeconsideredinmeetings Any actionotherthanthoselistedinsection28(1)requiring meetings ofthecommittee. The actions listed in section 28(1) shall be considered in eight hoursofthesaidmeeting. meeting toallparticipantsbyelectronicmeanswithinforty The resolution professional shall circulate the minutes of the or otheraudioandvisualmeans. attended themeetinginperson,throughvideoconferencing, minutes shall disclose the particulars of the participants who made in relation to each meeting of the committee and such The resolutionprofessional shall ensurethatminutes are without thepermissionofresolutionprofessional. or to the video conferencing or other audio and visual facility, shall beallowedaccesstotheplacewheremeetingisheld whose presence is required by the resolution professional no personotherthantheparticipantsandany From thecommencementofmeetingtillitsconclusion, quorum ispresentthroughoutthemeeting. The resolution professional shall ensure that the required the meetingandconfirmifrequiredquorumiscomplete. participants ofthenamesallpersonswhoarepresentfor After The resolution professional shall provide each member of the the of member each provide shall professional resolution The

the that no one other than him is attending or has access to the locationfromwhereheisparticipating; committee oranyotherparticipant; whether he is attending in the capacity of a member of the his name; material forthemeeting;and that hehas received the agendaandallthe relevant whether heisrepresentingamemberorgroupofmembers; person. the minutes. kept open for twenty four hours from the circulation of by electronicvotingsystemwhere thevotingshallbe seek avoteonthematterslistedforvotinginmeeting, of theconclusionmeeting;and to allmembersofthecommitteewithinfortyeighthours circulate the minutes of the meeting byelectronic means the rollcall,resolutionprofessionalshallinform proceedings ofthemeetingatlocationthat VOTING BYTHECOMMITTEE DECEMBER 2016 CHAPTER VII I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 105 104 DECEMBER 2016 I CHARTERED SECRETARY 27. 28.

(5) (4) (3) (2) c an (c) (b) (a) registered valuers: Provided thatthefollowingpersonsshallnotbeappointedas Regulation 35: the liquidation value of the corporate debtor in accordance with his appointment, appointtwo registered valuers to determine The interimresolutionprofessionalshallwithinsevendaysof Appointment ofregisteredvaluers. (d) (2) (1) Transfer ofdebtduetocreditors. CHARTERED SECRETARY CONDUCT OFCORPORATEINSOLVENCYRESOLUTION

(b) (a) Explanation- ForthepurposesoftheseRegulations- the provisionsofthisRegulation. means orthroughelectronicvotingsystem inaccordancewith committee themeanstoexerciseitsvotebyeitherelectronic means within twenty four hoursof the conclusionof thevoting. made undersub-regulation (4)to allparticipants byelectronic The resolution professional shall circulate acopy of the record from voting. committee whovotedfororagainstthedecision,abstained agenda item along with the names of the members of the record ofthesummarydecisiontakenonarelevant resolution professionalshall announce and make a written At theconclusionofavoteheldunderthisRegulation, be blocked. At the endof the voting period, the voting portal shallforthwith subsequently. committee, suchmembershallnotbeallowedtochangeit Once a vote on a resolution is castby a member of the a relatedpartyofthecorporatedebtor; a relativeoftheinterimresolutionprofessional; a partnerordirectoroftheinsolvencyprofessionalentity. the insolvencycommencementdate;or committee withintwodaysofsuch change. the AdjudicatingAuthorityofany resultantchangeinthe The resolutionprofessionalshall notifyeachparticipantand of theassigneeortransferee. be, the terms of such assignment or transfer and the identity professional ortheresolutionprofessional,ascasemay process period,bothpartiesshallprovidetheinterimresolution creditor toanyotherpersonduringtheinsolvencyresolution In the event a creditor assigns or transfers the debt due to such

auditor (iv) (iii) (ii) (i) hardware, software,andprocedurethat– the expression‘‘securedsystem’’meanscomputer with adequatecybersecurity; counted inanelectronicregistryacentralizedserver exercised by way of electronic means gets registered and of votespolledinfavouroragainst,suchthatthevoting of votes of the membersof thecommittee andthe number based processofdisplayelectronicballots, recording ‘‘electronic voting system’’ means a ”secured system” the expressions‘‘votingbyelectronic means’’ or

adhere togenerallyacceptedsecurityprocedures. functions; and are reasonably suited to perform the intended operation; provide areasonablelevelofreliabilityandcorrect and misuse; are reasonablysecurefromunauthorizedaccess of the corporate CHAPTER VIII I DECEMBER 2016 PROCESS debtor in the five years preceding 31. 30. 29. 33. 32. ) The 4) (3) d expenses (d) (c) (b) (a) mean- “Insolvency resolutionprocesscosts”underSection5(13)(e)shall Insolvency resolutionprocesscosts. Regulations. administration indischarginghisdutiesundertheCodeorthese Authority for an order seeking the assistance of the local district as the case may be, may make an application to the Adjudicating The interim resolution professional or the resolution professional, Assistance oflocaldistrictadministration. 3 A (3) (2) (1) Sale ofassetsoutsidetheordinarycoursebusiness. the fee to be paid to the interim resolution professional and other Explanation- The (1) Costs oftheinterimresolutionprofessional. of hydro-electricity. supplies for drinking and sanitation purposes, and not for generation Illustration- (4) (3) (2) water; (1) electricity; mean- The essentialgoodsandservicesreferredtoinsection14(2)shall Essential supplies. (e) 2 The (2)

by thecommitteetoextentitratifies. The applicantshallbeartheexpenseswhichbereimbursed has notfixedexpensesundersub-regulation(1) to theextentratifiedunderRegulation33; expenses incurredonorbytheinterimresolutionprofessional on accountofthemoratoriumimposedundersection14(1)(d); amounts due to a person whose rights are prejudicially affected Regulation 32; under services and goods ofessential tosuppliers due amounts agreement orotherdocumentofasimilarnature. the corporatedebtor,shareholders’agreement,jointventure notwithstanding the terms of the constitutional documents of shall haveafree andmarketable title to such assets approval ofthecommittee. A saleofassetsunderthisRegulationshallrequirethe total claimsadmittedbytheinterimresolutionprofessional. under thissub-regulationshallnotexceedtenpercentofthe corporate insolvency resolution process period in aggregate Provided circumstances ofthecase: necessary forabetterrealisationofvalueunderthefactsand course of business, if he is of the opinion that such a sale is asset(s) of the corporate debtor, other than in the ordinary The resolutionprofessionalmaysellunencumbered or suppliedbythecorporatedebtor. to theextentthesearenotadirectinputoutputproduced information technologyservices, telecommunication services;and treated asinsolvencyresolutionprocess costs. process andapprovedbythecommittee. other costsdirectlyrelatingtothecorporateinsolvencyresolution under Regulation34;and interim resolutionprofessional. INSOLVENCY RESOLUTIONPROCESSCOSTS bona Adjudicating applicant amount Water supplied to a corporate debtor will be essential For thepurposesofthisRegulation, “expenses” mean fide that thebookvalueofallassetssoldduring incurred purchaser of shall expenses Authority CHAPTER IX fix on the or of shall expenses by assets ratified the fix expenses resolution sold by to the be under incurred committee where professional this 105 the on Regulation applicant or shall by fixed the be

FROM THE GOVERNMENT FROM THE GOVERNMENT 106 35. The 34.

36. (2) (1) Liquidation value. Resolution professionalcosts. be incurredbytheinterimresolutionprofessional. expenses, includingthecostofengagingprofessionaladvisors,to by theresolutionprofessional. including thecostofengagingprofessionaladvisors,tobeincurred the feetobepaidresolutionprofessionalandotherexpenses, Explanation- For thepurposes of this Regulation, “expenses” mean resolution processcosts. resolution professional andthe expensesshallconstitute insolvency (3) (1) Information memorandum. (2)

committee (a) Liquidation valueshallbedeterminedinthefollowingmanner: liquidated ontheinsolvencycommencementdate. of thecorporatedebtorifweretobe Liquidation value is the estimated realizable value of the assets (b) (c) value tothecommitteeinelectronicform. The resolutionprofessionalshallprovidetheliquidation (a) details ofthecorporatedebtor- The information memorandum shall contain the following (b) (a) resolution applicantcontaining- form to each member of the committee and any potential be, shallsubmitaninformationmemoranduminelectronic professional ortheresolutionprofessional,as the casemay Subject tosub-regulation(4),theinterimresolution (e) (d) c audited (c) thelatestannual financialstatements; (b)

with internationally accepted valuation estimate oftheliquidationvaluecomputedinaccordance or theresolutionprofessional,ascasemaybe,an 27 shallsubmittotheinterimresolutionprofessional the two registered valuers appointed under Regulation two or theresolutionprofessional,ascasemaybe, if in the opinion of the interim resolution professional of thecorporatedebtor; physical considered theliquidationvalue. the averageoftwoclosestestimatesshallbe computed inthesamemanner;and another registered valuer who shall submit an estimate categories commencement date,classifiedintoappropriate insolvency the on as liabilities, assets and (2), withinfourteendaysofthefirstmeeting. matters listedinparagraphs(j)to(l)ofsub-regulation sub-regulation (2),beforeitsfirstmeeting;and at leastthematterslistedinparagraphs(a)to(i)of particulars of a debt due from or to the corporate debtor such claims; admitted andthesecurityinterest, ifany,inrespectof amounts claimedbythem,theamount oftheirclaims a listofcreditorscontainingthenames ofcreditors, the the application; a datenotearlierthanfourteendaysfromtheof statements for assigned toeachcategory; the estimates shall

last financial verification RESOLUTION PLAN two for fix for CHAPTER X easy the are

financial the significantly expenses statements identification, current of

the years inventory financial to different, and of be with the incurred

provisional year corporate estimated and standards, after he fixed may on made

or financial appoint assets values debtor by up the to

38. 37. Mandatory contentsoftheresolutionplan. (1) Resolution plan. (4) (3) 1 A (1)

(b) liquidation value due to operational creditors and value dueto operational (b) liquidation (a) insolvencyresolutionprocess costs andprovide that willbeusedtopaythe- (j) (j) (i) issuanceofsecuritiesthecorporatedebtor,forcash, (h) (g) extensionofamaturitydateorchangeininterestrate (f) (e) curing or waiving of any breach of the terms of any debt ormodificationofanysecurityinterest; (d) satisfaction (c) (b) saleofallorparttheassetswhethersubjecttoany (a) implementing it,includingbutnotlimitedtothefollowing- A resolution plan may provide for the measures required for comply withtherequirementsundersection29(2). an unduegainorlosstoitselfanyotherpersonand of the information and shall not use such information to cause member or apotentialresolutionapplicanttotheeffectthatsuch after receivinganundertakingfromamemberofthecommittee as thecasemaybe,shallshareinformationmemorandum The interim resolution professional or the resolution professional, information hasabearingontheresolutionplan. such informationtoallmemberswithinreasonabletimeif this Regulation and the resolution professional shall provide professional forfurtherinformationofthenaturedescribedin A member of the committee mayrequest the resolution (l) (k) (j) (i) (h) (g) (f)

resolution

the expiryofthirty daysaftertheapproval ofa in any eventbemadebefore shall creditor which provide paid inprioritytoanyothercreditor; be process costswill resolution that theinsolvency or otherappropriatepurpose;and property, securities,orinexchangeforclaimsinterests, corporate debtor; amendment oftheconstitutionaldocuments or othertermsofadebtduefromthecorporatedebtor; reduction intheamountpayabletocreditors; due fromthecorporatedebtor; security interestornot; to oneormorepersons; transfer ofallorparttheassetscorporatedebtor Governments andotherauthorities. obtaining necessaryapprovalsfromtheCentralandState one ormorepersons; or themergerconsolidationofcorporatedebtorwith the substantialacquisitionofsharescorporatedebtor, deems relevant professional resolution the which information, other the liquidationvalueduetooperationalcreditors;and the liquidationvalue; of thecorporatedebtortowardsthem; the numberofworkersandemployeesliabilities and statutoryauthorities; investigation orproceedinginitiatedbyGovernment details of allmaterial litigation andanongoing debtor alongwiththesizeofstake; holding atleastonepercentstakeinthecorporate the names and addresses of the members or partners specifying whichoftheguarantorsisarelatedparty; to thedebtsofcorporatedebtorbyotherpersons, details of guarantees that have been given in relation with respecttorelatedparties; or DECEMBER 2016 resolution for plan such shall to thecommittee. applicant payment identify I CHARTERED SECRETARY shall in specific priority maintain sources to any confidentiality financial of funds

CHARTERED SECRETARY I DECEMBER 2016 107 106 DECEMBER 2016 I CHARTERED SECRETARY 39. (Insolvency Resolution Process for Corporate Persons) Regulations, 2016] [Under Regulation6oftheInsolvency andBankruptcyBoardofIndia 40.

(6) (5) (4) (3) (2) (1) Approval ofresolutionplan. (2) (2) (1) Extension of the corporate insolvency resolution process period. (8) (7) CHARTERED SECRETARY

obtained. been not has consent such that notwithstanding other documentof a similarnature,shalltakeeffect agreement, jointventureagreementor shareholders’ of the constitutional documents of the corporate debtor, corporate debtor,asthecasemay be, undertheterms the consentofmembersorpartners require A provision inaresolutionplanwhichwouldotherwise resolution applicant. rejecting aresolutionplanto the participantsand or Authority approving of theAdjudicating of theorder shall forthwithsendacopy professional The resolution (b) (a) Authority withthecertificationthat: plan approved by the committee to the Adjudicating shall submittheresolution professional The resolution such modificationsasitdeemsfit. with plan any resolution The committeemayapprove Regulations tothecommitteeforitsconsideration. plans that meettherequirementsof Codeandthese shall presentallresolution professional The resolution corporate insolvencyresolutionprocess. permitted undersection12for the completionof the thirty daysbeforeexpiryofthemaximumperiod professional, to theresolution and theseRegulations with theCode in accordance plan prepared resolution A resolutionapplicantshallendeavourtosubmita implementation. its supervising for means (c) adequate (b) the managementandcontrolof the businessof the (a) the term of the planandits implementation schedule; A resolutionplanshallprovide: (c) to theAdjudicatingAuthorityforsuch extension. from the committee under this Regulation, make an application The resolutionprofessionalshall,onreceivinganinstruction extend theinsolvencyresolutionprocessperiod. an applicationtotheAdjudicatingAuthorityundersection12 The committee may instruct the resolution professional to make the termsofaresolutionplan. implementing in administration district assistanceofthelocal the application totheAdjudicatingAuthorityforanorderseeking is approvedbytheAdjudicatingAuthority,maymakean and operationsofthecorporatedebtorafteraresolutionplan A personinchargeof the management orcontrol of the business commencement date. for anyactionsofthecorporatedebtor,priortoinsolvency professional or the resolution professional, as the case may be, No proceedingsshallbeinitiatedagainsttheinterimresolution

committee. the resolutionplanhasbeenapprovedby requirements of the Codeandthe Regulations; and the contentsofresolution plan meetall the corporate debtorduringitsterm;and creditors whovoted infavour of the resolution plan. resolution planbytheAdjudicatingAuthority;and before creditors andprovide that such payment ismade liquidation PUBLIC ANNOUNCEMENT any SCHEDULE FORMA value recoveries I DECEMBER 2016 due are to made dissenting by the financial financial

[Name ofCorporateDebtor] FOR THEATTENTIONOFCREDITORS The interim resolutionprofessionalattheaddressmentionedagainstitem8. days from the appointment of the interim resolution professional] to the submit aproofoftheirclaimsonorbefore[insertthedatefallingfourteen The creditorsof[namethecorporatedebtor],areherebycalleduponto the [nameofcorporatedebtor]on[insolvencycommencementdate]. the commencement of a corporate insolvency resolution process against hasordered Tribunal Law Company theNational that given hereby is Notice Subject: Submissionofproofclaim. [Name andaddressoftheoperational creditor] From [Address assetoutinpublicannouncement] [Name ofthe InsolvencyResolution Professional /ResolutionProfessional] The InterimResolutionProfessional /ResolutionProfessional To (Insolvency Resolution Process for Corporate Persons) Regulations, 2016] [Under Regulation7oftheInsolvencyandBankruptcyBoardIndia Date andPlace Name andSignatureofInterimResolutionProfessional: Submission offalseormisleadingproofsclaimshallattractpenalties. may submittheproofofclaimsbyinperson,postorelectronicmeans. employees, and workmen including creditors, operational The only. means 9. 8. PARTICULARS RELEVANT 7. 6. 5. 4. 3. 2. 1. PROOF OFCLAIMBYOPERATIONALCREDITORSEXCEPT financial OF CLAIMS OF SUBMISSION FOR DATE LAST PROFESSIONAL THEINTERIM RESOLUTION OF NUMBER REGISTRATION THE AND ADDRESS NAME, ADDRESS, EMAIL PROCESS RESOLUTION INSOLVENCY OF CLOSURE ESTIMATED OF DATE DEBTOR CORPORATE OF RESPECT IN DATE COMMENCEMENT INSOLVENCY DEBTOR CORPORATE ANY) OF (IF OFFICE PRINCIPAL REGISTERED OFFICEAND THE OF ADDRESS DEBTOR CORPORATE IDENTIFICATION OFNUMBER / LIMITEDNUMBER LIABILITY IDENTITY CORPORATE REGISTERED / INCORPORATED IS DEBTOR CORPORATE WHICH UNDER AUTHORITY DEBTOR CORPORATE OF INCORPORATION OF DATE DEBTOR CORPORATE OF NAME creditors : WORKMEN ANDEMPLOYEES shall SCHEDULE FORMB submit

their proof of claims 107 by electronic (Date)

FROM THE GOVERNMENT FROM THE GOVERNMENT [name ofcorporatedebtor].Thedetailsforthesamearesetoutbelow: in respectofthecorporateinsolvencyresolutionprocesscase [Name of the operational creditor], hereby submits this proof of claim Madam/Sir, 108 11. 10. 9. 8. 7. 6. 5. PARTICULARS 4. 3. 2. 1. CREDITOR TODUETHE OPERATIONAL CLAIM OF PAYMENT NON- AND THEEXISTENCE PROVE TO ORDER IN CLAIMOF ATTACHED TO THIS PROOF DOCUMENTS OF LIST TOA RESOLUTION PLAN PURSUANT TRANSFERRED BE PARTTHEREOFANY CAN OR THE CLAIM OF AMOUNT ACCOUNT TO WHICH THE DETAILS THE BANK OF CLAIM REFERS PROPERTIES TO WHICHTHE RESPECT OF GOODS OR OF TITLE ARRANGEMENTS IN DETAILS OF ANY RETENTION AGAINST THE CLAIM WHICH MAYBESET-OFF DEBTOR ANDTHECREDITOR BETWEEN THECORPORATE DEALINGS MUTUAL OTHER DEBTS, OR CREDIT, MUTUAL ANY DETAILSMUTUAL OF DEBT INCURRED DETAILS ANDWHEN HOW OF PROCEEDINGS SUIT OR ARBITRATION PENDENCY ORORDEROF WELL ASTHERECORDOF DETAILS OF ANY DISPUTEAS SUBSTANTIATED. THE DEBTCANBE BY REFERENCETO WHICH DETAILS OF DOCUMENTS COMMENCEMENT DATE) AS AT THEINSOLVENCY (INCLUDING ANYINTEREST TOTAL AMOUNT OF CLAIM CORRESPONDENCE FOR CREDITOR ADDRESS OF OPERATIONAL AND EMAIL ADDRESS THE INDIVIDUAL) ALLTHE OF PARTNERS OR RECORDS* IDENTIFICATION PROVIDE INDIVIDUAL OR PARTNERSHIP A IF INCORPORATION. OF AND PROOF NUMBER IDENTIFICATION PROVIDE BODY INCORPORATED AN (IF CREDITOR OPERATIONAL OF NUMBER IDENTIFICATION CREDITOR NAMEOF OPERATIONAL [Name From [Address assetoutinpublicannouncement] [Name ofthe Insolvency Resolution Professional/ ResolutionProfessional] The InterimResolutionProfessional/Professional, To (Insolvency Resolution Process for Corporate Persons) Regulations, 2016] [Under Regulation8oftheInsolvencyandBankruptcyBoardIndia respect of the corporate insolvency resolution process in the case of case the processin resolution corporateinsolvency ofthe respect [Name Madam/Sir, Subject: Submissionofproof claim. financial creditor] Verified at...... onthis...... dayof...... 201...... belief andnomaterialfactshavebeenconcealedtherefrom. of paragraphto of I, Notary /OathCommissioner 4. 3. 2. 1. affirm andstateasfollows: I, [nameofdeponent],currentlyresidingat[insertaddress],dosolemnly the ElectionCommissionofIndia *PAN number,passport,AADHAARCardortheidentitycardissuedby

the Address of person signing creditor to relation in with Position or LETTERS BLOCK Name in creditor operational an of [ his behalf on act authorised to person or operational creditor of Signature Please Please enclose authority the if this submitted is being on behalf the...... day of...... 20....Beforeme, Solemnly, affirmedat[insertplace]on...... day, may beset-offagainsttheclaim.] mutual dealingsbetweenthecorporatedebtorandcreditorwhich [Please statedetailsofanymutualcredit,debts,or other and exceptthefollowing: received anymannerofsatisfactionorsecuritywhatsoever,save person, bymyorder,toknowledgeorbelief,foruse,had In respect of the said sum or any part thereof, I have not nor has any knowledge, informationandbelief. The saiddocumentsaretrue,validandgenuinetothebestofmy [Please listthedocumentsreliedonasevidenceofclaim] relied onthedocumentsspecifiedbelow: In respectofmyclaimthesaidsumoranypartthereof,Ihave [insert amountofclaim]...... 20...., justlyandtrulyindebtedtomeinthesumofRs. insolvency commencementdate,beingthe...... dayof [Name ofcorporatedebtor],thedebtorwas,at Deponent and of the PROOF OFCLAIMBYFINANCIALCREDITORS address financial

hereinabove, this of DECEMBER 2016 affidavit creditor], the SCHEDULE FORMC VERIFICATION registered ]

do AFFIDAVIT are hereby hereby true I and office verify CHARTERED SECRETARY submits correct and and affirm principal this Deponent’s signature Deponent’s signature to my proof that knowledge

office the of contents claim [Date] of and the in

CHARTERED SECRETARY I DECEMBER 2016 109 108 DECEMBER 2016 I CHARTERED SECRETARY the ElectionCommissionofIndia. *PAN number,passport,AADHAAR Cardortheidentitycardissuedby [name ofcorporatedebtor].Thedetailsforthesamearesetoutbelow: 10. 9. 8. 7. 6. 5. 4. 3. 2. 1. PARTICULARS Address ofpersonsigning Position withorinrelationtocreditor Name inBLOCKLETTERS operational creditor] [Please enclosetheauthorityifthisisbeingsubmittedonbehalfofan Signature CHARTERED SECRETARY AGAINST THE CLAIM WHICH MAYBESET-OFF DEBTOR ANDTHECREDITOR BETWEEN THE CORPORATE OTHER MUTUALDEALINGS CREDIT, MUTUALDEBTS, OR DETAILS OF ANY MUTUAL DEBT INCURRED DETAILS ANDWHEN HOW OF SUBSTANTIATED BE CAN DEBT TOREFERENCE THEWHICH DETAILS DOCUMENTS OF BY DATE) COMMENCEMENT INSOLVENCY THE AT AS INTEREST ANY INCLUDING CLAIM OF AMOUNT TOTAL CORRESPONDENCE. FOR CREDITOR FINANCIAL OF ADDRESS AND EMAIL ADDRESS PARTNERS ORTHEINDIVIDUAL) RECORDS* OFALLTHE IDENTIFICATIONPROVIDE PARTNERSHIP OR INDIVIDUAL INCORPORATION. IFA OF PROOF AND NUMBER IDENTIFICATIONPROVIDE (IF ANINCORPORATEDBODY FINANCIAL CREDITOR IDENTIFICATION NUMBER OF CREDITOR FINANCIAL OF NAME TO THE PERATIONALCREDITOR PAYMENT OF CLAIM DUE THE EXISTENCEANDNON- CLAIM INORDERTO PROVE ATTACHED TO THIS PROOF OF LIST OF DOCUMENTS A RESOLUTION PLAN TRANSFERRED PURSUANTTO ANY PARTTHEREOF CAN BE AMOUNT OF THE CLAIMOR ACCOUNT TO WHICH THE DETAILS OF THE BANK WAS GIVEN SECURITY, ANDTHEDATEIT HELD, THEVALUEOF THE DETAILS OF ANY SECURITY of financial creditor or I DECEMBER 2016 person authorised to act on his behalf [name ofcorporatedebtor].Thedetailsforthesamearesetoutbelow: in respectofthecorporateinsolvencyresolutionprocesscase of [Name oftheworkman/employee],herebysubmitsthisproofclaim Madam/Sir, Subject: Submissionofproofclaim. [Name andaddressoftheworkman/employee] From [Address assetoutinpublicannouncement] [Name ofthe Insolvency Resolution Professional/ Resolution Professional] The InterimResolutionProfessional/ To Resolution ProcessforCorporatePersons)Regulations,2016] [Under Regulation9oftheInsolvencyandBankruptcy(Insolvency Verified at...... onthis...... dayof...... 20...... belief andnomaterialfactshavebeenconcealedtherefrom. Solemnly, affirm andstateasfollows: I,[name ofdeponent],currentlyresidingat[insertaddress],dosolemnly of paragraphto of I, Notary/Oath Commissioner day of...... 20...... Beforeme, 2. 1. PARTICULARS

the may beset-offagainsttheclaim.] mutual dealingsbetweenthecorporatedebtorandcreditorwhich [Please statedetailsofanymutualcredit,debts,or other 4. 3. 2. 1. Deponent OF WORKMAN / / WORKMAN OF EMPLOYEE OR AADHAAR INDIA CARD OF COMMISSION ELECTION THE ISSUED BY CARD IDENTITY PASSPORT,NUMBER, THE PAN EMPLOYEE NAME OFWORKMAN / PROOF OFCLAIMBYAWORKMANORANEMPLOYEE whatsoever, saveandexceptthefollowing: my use,hadorreceivedanymannerofsatisfactionsecurity has anyperson,bymy order, tomyknowledgeorbelief,for In respect of the said sum or any part thereof, I have not nor my knowledge,informationandbelief. The said documents are true, valid and genuine to the best of documents reliedonasevidenceofclaim] have In respectofmyclaimthesaidsumoranypartthereof,I of Rs.[insertamountclaim]. of...... 20...., justlyandtrulyindebtedtomeinthesum insolvency commencement date, being the...... day [Name of corporate debtor], the corporate debtor was, at the affirmed

relied hereinabove,

at this [insert on affidavit the SCHEDULE FORMD place] VERIFICATION documents

do AFFIDAVIT are hereby on...... day, true and verify specified correct and affirm below: Deponent’s signature Deponent’s signature to my the...... that knowledge 109 [Please

the contents list [Date] and the

FROM THE GOVERNMENT FROM THE GOVERNMENT affirm andstateasfollows: I, [nameofdeponent],currentlyresidingat[insertaddress],dosolemnly 110 10. 9. 8. 7. 6. 5. 4. 3. Address ofpersonsigning Position withorinrelationtocreditor Name inBLOCKLETTERS operational creditor] [Please enclosetheauthorityifthisisbeingsubmittedonbehalfofan behalf Signature of workman / employee or person authorised to act on his 2. 1. OR ARBITRATION PROCEEDINGS ARBITRATION OR OF ORDER OR SUIT PENDENCY WELLTHE ASOF RECORD DETAILS ANYOF DISPUTEAS SUBSTANTIATED. BE CAN CLAIM WHICH THE REFERENCE TO BY DETAILS DOCUMENTS OF THE OPERATIONAL CREDITOR THE OPERATIONAL PAYMENT CLAIM OF DUE TO THE EXISTENCE AND NON- TO PROVE ORDER IN CLAIM ATTACHED TO THIS PROOF OF DOCUMENTS OF LIST PLAN RESOLUTION A TO PURSUANT TRANSFERRED BE PARTTHEREOFANY CAN OR THECLAIM OF AMOUNT ACCOUNT TO WHICH THE DETAILS THE BANK OF CLAIM THE AGAINST WHICH MAYSET-OFF BE DEBTORAND THECREDITOR BETWEEN THECORPORATE DEALINGS MUTUAL OTHER DEBTS, OR CREDIT, MUTUAL ANY DETAILSMUTUAL OF CLAIM AROSE DETAILS ANDWHEN HOW OF COMMENCEMENT DATE) AS AT THE INSOLVENCY (INCLUDING ANYINTEREST TOTAL AMOUNT OF CLAIM CORRESPONDENCE FOR/ EMPLOYEE WORKMAN OF ANY) (IF ADDRESS AND EMAIL ADDRESS In respectofmyclaimthesaid sumoranypartthereof,I [insert amountofclaim]...... 20...... , justly andtrulyindebted to me in the sumof Rs. insolvency commencement date, being the ...... day of [Name of corporate debtor], the corporate debtor was, at the AFFIDAVIT Madam/Sir, [Date] Subject: Submissionofproofsclaim. / employees] [Name andaddressofthedulyauthorisedrepresentativeworkmen From [Address assetoutinpublicannouncement] [Name ofthe InsolvencyResolution Professional/ ResolutionProfessional] The InterimResolutionProfessional/Professional, To Resolution ProcessforCorporatePersons)Regulations,2016) (Under Regulation9oftheInsolvencyandBankruptcy(Insolvency Verified at...... onthis...... dayof...... 20...... belief andnomaterialfactshavebeenconcealedtherefrom. of paragraphto of I, Notary/Oath Commissioner Solemnly, Annexure A,solemnlyaffirmandsay: employed by the above named corporate debtor and listed in workmen / employees], onbehalf of the workmen andemployees currently residingat[addressofauthorisedrepresentative the I, [nameofauthorisedrepresentativetheworkmen/employees],

the of ...... 20....Beforeme, may beset-offagainsttheclaim.] mutual dealingsbetweenthecorporatedebtorandcreditorwhich [Please statedetailsofanymutualcredit,debts,orother 4. 3. 1. Deponent

REPRESENTATIVE OFWORKMENANDEMPLOYEES PROOF OFCLAIMSUBMITTEDBYAUTHORISED whatsoever, saveandexceptthefollowing: my use,hadorreceivedanymannerofsatisfactionsecurity has anyperson,bymy order, tomyknowledgeor belief, for In respect of the said sum or any part thereof, I have not nor my knowledge,informationandbelief. The said documents are true, valid and genuine to the best of documents reliedonasevidenceofclaim] have services rendered by them respectively to the corporate services rendered bythemrespectivelytothe corporate the employmentofcorporate debtorinrespectof them respectively as workmen or/ and employees in A forwages,remunerationand otheramountsdueto severally setagainsttheirnames insuchAnnexure appear in the Annexure A below in amounts persons whose names, addresses, and descriptions day of...... 20....,justlytrulyindebtedtotheseveral insolvency commencement date, being the...... That the above named corporate debtor was, at the affirmed

relied hereinabove, this at DECEMBER 2016 on [insert affidavit the VERIFICATION place] documents

do SCHEDULE are FORM E hereby true on ...... day, I and verify CHARTERED SECRETARY specified correct and affirm below: Deponent’s signature Deponent’s signature to my that the...... day knowledge [Please

the contents list and the

CHARTERED SECRETARY I DECEMBER 2016 111 110 DECEMBER 2016 I CHARTERED SECRETARY

REPRESENTATIVE ONBEHALFOFWORKMEN/EMPLOYEES] [PLEASE SUBMITIFAPPLICATIONSUBMITTEDBYAUTHORISED AffidavitintheformsetoutthisFormE. (b) (a) ATTACHMENTS: 3. 2. 1. DetailsofEmployees/Workmen NO. S.

4. 3. 2. 1. creditor whichmaybeset-offagainsttheclaim.] the and debtor corporate the between dealings mutual other [Please state details of any mutual credit, mutual debts, or 2. 4. 3. 2. 1. solemnly affirmandstateasfollows: I, [name of deponent], currently residing at [insert address], do non-payment ofdebt. Documents reliedasevidenceproofofdebtandproofs be set-offagainsttheclaim. dealings betweenthecorporatedebtorandcreditorwhichmay Particulars of any mutual credit, mutual debts, or other mutual of suitorarbitrationproceedings(ifany). recordofpendency the as well as dispute ofany particulars including Particulars of how debt was incurred by the corporate debtor, CHARTERED SECRETARY WORKMAN EMPLOYEE/ NAME OF In respect of the said sum or any part thereof, I have not nor my knowledge,informationandbelief. The said documents are true, valid and genuine to the best of documents reliedonasevidence of claim] have In respectofmyclaimthesaidsumoranypartthereof,I Rs. [insertamountofclaim]. of...... 20..., justlyandtrulyindebted to me in the sumof the insolvencycommencementdate,beingthe...... day [Name ofcorporatedebtor],thedebtorwas,at the following: of satisfactionorsecuritywhatsoever,saveandexcept not, norhasanyofthem,hadorreceivedmanner That forwhichsaidsumsoranypartthereof,theyhave respective namesinthesaidAnnexureA. debtor duringsuchperiodsasaresetoutagainsttheir relied on IDENTIFICATION IDENTIFICATION (PAN NUMBER, NUMBER, (PAN PASSPORT OR OR PASSPORT the AADHAAR NUMBER NUMBER CARD) documents AFFIDAVIT I DECEMBER 2016 specified (RS.) DUE AMOUNT TOTAL below: AMOUNT DUE AMOUNT WHICH OVER PERIOD [Please ANNEXURE Deponent list the of I, Solemnly, Notary/Oath Commissioner on this...... dayof...... 20...... belief andnomaterialfactshavebeenconcealedtherefrom.Verifiedat

the paragraph may beset-offagainsttheclaim.] mutual dealingsbetweenthecorporatedebtorandcreditorwhich [Please statedetailsofanymutualcredit,debts,or other of...... 20.... Beforeme, Deponent A [email protected]. their resumeinword formatto: please mail Interested candidates preferred. as CA Inter having The candidate(s) constraint fortherightcandidate. and computerskills.Salaryisnota should haveexcellentcommunication candidate Theideal regulations. Act, FEMA, RBI and otherstatutory of working knowledgeCompanies with 1 to2yearsofexperience having Secretary Company requires whatsoever, saveandexceptthefollowing: my use,hadorreceivedanymannerofsatisfactionsecurity has anyperson,bymy order, tomyknowledgeor belief, for APPOINTMENT an to for aMultinationalCompany

hereinabove, located in Andheri,Mumbai located company multinational leading of affirmed additional this Company Secretary Company Secretary affidavit at VERIFICATION

[insert do aretrue hereby qualification place] and verify correct on...... day, and affirm Deponent’s signature Deponent’s signature to my Dr. M.S.SAHOO, will that knowledge 111 the...... day

Chairperson the be contents and

FROM THE GOVERNMENT 112 DECEMBER 2016 I CHARTERED SECRETARY News from5 the Institute & Regions

n Members Admitted/Restored n Certificate of Practice Issued/Cancelled n Licentiate ICSI Admitted n Company Secretaries Benevolent Fund n List of Practising Members/Companies Registered for Imparting Training n Regional News

CHARTERED SECRETARY I DECEMBER 2016 113 Training Programme on “The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013”

The Parliament enacted the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 to provide protection to Women against Sexual Harassment at workplace and for the prevention and redressal of complaints of Sexual Harassment and matters connected therewith or incidental thereto.

The ICSI, to promote good Governance, is also commemorating its efforts towards creating awareness on the critical aspects of provisions of the Sexual Harassment of Women at Work Place (Prevention, Prohibition and Redressal) Act, 2013. In furtherance to the efforts of the Institute to sensitize the participants on the subject and to understand the implementation level of the Act in various organizations, the Institute of Company Secretaries of India (ICSI) is organ- izing a full day training programme on the subject with the following tentative schedule:

Date: Friday, 23rd December, 2016 Time : 09:30 AM to 04:00 PM

Venue : ICSI House, 22, Institutional Area, Lodi Road, New Delhi – 110 003

* For updates, please visit www.icsi.edu Four PCH would be awarded to members for attending Timings: 09:30 AM to 04:00 PM tentative the Training Programme

All are cordially invited to participate

For Online Registration, please click the link mentioned below: https://www.icsi.in/student/DelegateRegistration/tabid/137/ctl/ViewEventDetails/mid/454/EventId/47/Default.aspx

Programme Schedule Inquiry and Conciliation procedure - Conciliation Day & Date : Friday, 23 December 2016, - Inquiry process Venue : ICSI house, 22, Institutional Area, Lodi - Interim Relief Road, New Delhi-110003 - Monetary Compensation - Possible recommendations & outcomes 2:00 PM - 3:30PM 9:30AM - 10:00AM Registration Judicial Precedence Introduction & Background of Law - Case Study - The Evolution of law - The law has been interpreted by several - Salient features courts over the last 2 year. - Important definitions including sexual Discussion with regards to a few important harassment judgments 10:00 AM - 11:30AM 3:30 PM - 4:00PM Question & Answer Identifying Sexual Harassment - Types of Sexual harassment: Quid Pro Quo Networking Tea - & Hostile Work Environment - Unwelcome & Intent v/s Impact Trainer : Mr. Vishal Kedia, Founder & Director, Complykaro

- Sexual Harassment involving third parties & Services Pvt. Ltd.

varying authorities Registration Fee: - 11:30AM - 11:45AM Tea Break Rs. 5000/- for a single delegate Recourse against Sexual harassment - Redressal options and procedure, rights of For Online Registration please click the link mentioned below:- 11:45 AM - 1:00PM Aggrieved Women https://www.icsi.in/student/DelegateRegistration/tabid/137/ctl/ViewEventDetails/ - Corresponding options and procedure, rights mid/454/EventId/47/Default.aspx of Respondent 1:00 PM - 2:00PM Lunch

114 DECEMBER 2016 I CHARTERED SECRETARY FELLOWS* Admitted Members ASSOCIATES* *ADMITTED DURING THEPERIODFROM20.10.2016TO19.11.2016 NO. NO. Sl. 14 13 12 11 10 Sl. 25 24 23 22 21 20 19 18 17 16 15 14 13 12 11 10 4 3 2 1 9 8 7 6 5 9 8 7 6 5 4 3 2 1 NAME SH. VGOPALAKRISHNA MRS. RITIKAAGRAWAL MS. VARSHARANIRAJARAMKATRE MRS. SAPNAKHANDELWAL MR. SUKHWINDERSINGH MS. PRIYANKASAXENA MS. ANUNIJHARA MS. AMRUTAANILBILGI MS. DEEPAROOPPRADEEPMITRA MR. DHAWALCHHAGANLALGADDA MS. PRACHIGARG MRS. SHIKHAGINORIA MR. PANKAJKUMARMITTAL MS VEENATUSHARVAIDYA MR. SHEKHARSHARMA MS. KHUSHBOOCHAWLA MS. ANNUGUPTA MR. UTKARSHDUBEY MS. PRIYANKAMISHRA MR. AMANKUMARVERMA MS. YUMAPANDEY MR. VARUNMEHRA MS. SHALINISINGH MR. VAIBHAVGARG MR. ABHISHEKPATHAK MS. DEEPIKAAGRAWAL MS. SHIVANISANGHI MS. JASMEETCHAWLA MR. NAMANSETHI MS. SUSHMAPANWAR MR. MADANMOHANMISHRA MS. ARADHANATIWARY MS. HENYPAHUJA MS. MADHURIJHAWAR MS. NEHAAGARWAL MS. SHRISTIGARG MR. GEORGEKUMARDAS MS. VINITAKABRA MS. PUJAJHUNJHUNWALA NAME CHARTERED SECRETARY I DECEMBER 2016 Institute ACS -47527 ACS -47526 ACS -47525 ACS -47524 ACS -47523 ACS -47522 ACS -47521 ACS -47520 ACS -47519 ACS -47518 ACS -47517 ACS -47516 ACS -47515 ACS -47514 ACS -47513 ACS -47512 ACS -47511 ACS -47510 ACS -47509 ACS -47508 ACS -47507 ACS -47506 ACS -47505 ACS -47504 ACS -47503 FCS -8948 FCS -8950 FCS -8949 FCS -8947 FCS -8960 FCS -8959 FCS -8958 FCS -8957 FCS -8956 FCS -8955 FCS -8954 FCS -8953 FCS -8952 FCS -8951 News MEMB. MEMB. NO. NO. REGN. REGN WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC SIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC EIRC EIRC SIRC EIRC EIRC EIRC EIRC EIRC EIRC 70 69 68 67 66 65 64 63 62 61 82 60 59 58 81 57 80 56 79 55 54 78 53 77 52 76 51 75 50 74 49 73 48 72 47 71 46 45 44 43 42 41 40 39 38 37 36 35 34 33 32 31 30 29 28 27 26 MS. RUCHIBHANGADIA MS. FARIDHAM MS. ANUPAMARADHAKRISHNAN MR. SRIDHARO MR. SAMBAIAH MR. BALAKRISHNANUVVULA MR. NIKHILESHAGARWAL MR. CHETANKUMARA MR. KARTHIKB MR. VIRENDRACHHATWANI MS. DIMPLEGAUR MS. CHANCHALLUNIA MR. GITESHKUMARPRASAD MR. JIGARKIRITBHAIGADESHA MR. AWANISHKUMAR MS. JENNYGHANSHAMCHHABADA MS. AVANTIKASHUKLA MS. RUTWABHARATKUMARSHAH MR. SUMITMADAN MR. SAMARLASUMAN MR. JAYBHAVESHPAREKH MR. NITINSUDAMYADAV MR. KAMALKIRITKUMARKHATRI MS. HETIDHIMANTBHAISHAH MR. RAJUKEDARPRASAD MS. KOMALKANAIYALALTOLANI MS. TUNDIYAKINJALNIRMALKUMAR MS. DARSHISANJAYSANGANI MS. POOJANITYANANDMISHRA MS. SHEETALMANOHARMUSALE MR. DWIREFLAXMIPRASADVORA MR. ALOKSURYAKANTDESAI MR. KULDIPSINHJAYENDRASINHZALA MS. TRUPTILALJIPATEL MR. HARDIKHEMANTPAWAR MR. SUDARSHANSHRIKANTGAWADE MS. TIRANDASUGEETA MS. AISHWARYAA MR. CHINIMALLIKARJUNA MR. VIJAYAKUMARCHOWTISHIVANANDA MR. BHAVINKUMARARVINDKUMARPATEL MS. PARULBANSAL MR. PARAMVIRRAJPUT MR. SEMANTJUNEJA MR. ANUJSHARMA MS. DEEPALIKAKKAR MR. RAJATMISHRA MS. YUSRAFATIMA MS. DEEPIKABHARDWAJ MS. ADITIMEHTA MS. KHWAISHKAMLANI MS. PRACHIKHARE MR. RAJENDARSINGH MR. BALRAMPANDEY MR. RISHISINGHDHAKAR MR. AMANDEEPSINGH MS. GARIMAGIROTRA ACS -w47547 ACS -47571 ACS -47570 ACS -47569 ACS -47568 ACS -47567 ACS -47566 ACS -47565 ACS -47564 ACS -47563 ACS -47584 ACS -47562 ACS -47561 ACS -47560 ACS -47583 ACS -47559 ACS -47582 ACS -47558 ACS -47581 ACS -47557 ACS -47556 ACS -47580 ACS -47555 ACS -47579 ACS -47554 ACS -47578 ACS -47553 ACS -47577 ACS -47552 ACS -47576 ACS -47551 ACS -47575 ACS -47550 ACS -47574 ACS -47549 ACS -47573 ACS -47548 ACS -47546 ACS -47545 ACS -47544 ACS -47572 ACS -47543 ACS -47542 ACS -47541 ACS -47540 ACS -47539 ACS -47538 ACS -47537 ACS -47536 ACS -47535 ACS -47534 ACS -47533 ACS -47532 ACS -47531 ACS -47530 ACS -47529 ACS -47528 115 WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC EIRC EIRC SIRC SIRC SIRC SIRC SIRC

NEWS FROM THE INSTITUTE NEWS FROM THE INSTITUTE 116 106 105 104 103 102 101 100 108 107 112 111 110 109 113 114 121 120 119 118 117 116 115 123 122 124 125 126 128 127 129 130 131 132 133 134 139 138 137 136 135 99 98 97 96 95 94 93 92 91 90 89 88 87 86 85 84 83 DR. CHIDAMBARAIYERJ MR. RAJANGHAI MS. SHRISHTIPANDEY MS. GAURIBDIGHWA MR. PARTHHARILALJOSHI MS. MRUNMAYEESANJEEVGADGIL MS. RAJVIVINODCHANDRAUPADHYAY MS. AMRUTADESHPANDE MR. DILIPKUMAR MR. ANILAGARWAL MS. KANIKALADIA MR. JUGALKISHORSHARMA MS. RUCHIPAREKH MS. KRAJALAKSHMI MS. SANJANASURI MR. AMANARORA MS. SAMRIDHIBHALLA MS. PARULDWIVEDI MR. JAYAPRAKASHL MR. AHSANALIHUSSAINAJANI MS. RESHMAMC MS. KRISARUPALKUMARPATEL MR. JAGADISHPRASADDAS MR. RICHIMINESHBHAISHAH MR. SHIVAMBAGHEL MR. HELIHITESHKUMARMODI MS. MAITRIDEEPAKBHATT MS. MONIKAGOYAL MR. BHARATNARANG MR. YASHPRASHANTKUMARMEHTA MR. PRATAPKUMARDASH MR. JITINWASAN MS. HEENALPRATAPTHAKKAR MS. SIMPIBORAH MS. SNEHAANANDKUMARBHARATIA MR. PRIYANGSHUSARMA MS. NEHADEVIDASKOLAPKAR MS. SWETAAGARWAL MR. AVNEESHMISHRA MS. NITUGUPTA MR. AMARKUMAR MS. URVIHASMUKHBHAIKESARIYA MS. SOMALITIWARI MR. DHRUVALALKESHBHAIPATEL MS. SAREEKAJAIN MS. SAPNAJAGDISHTOLANI MS. SANCHITAAGARWAL MR. SMITHITENSHAH MS. PRERNAKAKKAR MS. SEJALTEJAWAT MS. ATRISHA MS. ASHAAGARWAL MS. POOJACHOTANI MS. MANSI MS. ALPNAGALGAT MS. GARIMAMALIK MR. PARTHARYA ACS -47608 ACS -47607 ACS -47606 ACS -47605 ACS -47604 ACS -47603 ACS -47602 ACS -47601 ACS -47600 ACS -47599 ACS -47610 ACS -47609 ACS -47598 ACS -47614 ACS -47613 ACS -47612 ACS -47611 ACS -47597 ACS -47615 ACS -47596 ACS -47616 ACS -47595 ACS -47623 ACS -47622 ACS -47621 ACS -47620 ACS -47619 ACS -47618 ACS -47617 ACS -47594 ACS -47625 ACS -47624 ACS -47593 ACS -47626 ACS -47592 ACS -47627 ACS -47591 ACS -47628 ACS -47590 ACS -47630 ACS -47629 ACS -47589 ACS -47631 ACS -47588 ACS -47632 ACS -47587 ACS -47633 ACS -47586 ACS -47585 ACS -47634 ACS -47635 ACS -47636 ACS -47641 ACS -47640 ACS -47638 ACS -47637 47639 ACS - WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC SIRC SIRC SIRC SIRC SIRC EIRC SIRC EIRC EIRC EIRC SIRC EIRC EIRC EIRC EIRC EIRC EIRC SIRC 196 195 194 193 192 191 190 189 188 187 186 185 184 183 182 169 170 171 167 166 165 164 163 162 161 160 159 158 157 156 155 154 153 152 151 150 149 148 147 146 145 144 143 142 141 140 172 168 173 174 175 176 181 180 179 178 177 MR. SIVA PRASAD GOPA KUMAR KUNNATH MS. PAYALSINGH MR. ANEESHPARWANI MS. ANITAVASANTPAGARE MS. SONAMGOYAL MS. POOJAMANOHARDEVLEKAR MR. NIRMALCHAITANYAPANCHAL MS. SHRADDHASUNILSAINKAR MS. PRIYANKARAJESHPANJWANI MS. AANALBHARATBHAIPATEL MS. RICHAGUPTA MR. YOGESHRAGHAVBHAIMUDSHA MR. RAJPUTMEHULGANESH MR. RAHIMBABUSHAIKH MR. SUMITKUMARJAYANTIBHAIPATEL MR. ANKURSEN MR. ARJUNR MS. SREERAMYADWARAM MR. VINODKUMARM MR. SARATHSASIDHARA MR. RAJATKUMARMITTAL MS. ISHAJAISWAL MS. SHWETAGUPTA MS. DIPIKAJAIN MS. BHAGYASHREESADHWANI MS. NISHA MR. ROHITJAIN MR. PANKAJNAVANI MR. KARTIKSETHI MR. SAURABHTIWARI MS. MANICAGUPTA MS. NEHAMAHENDRU MR. RAKESHKUMARJANGIR MS. MEENAKSHIMOONDRA MR. SAMEERKANCHAN MS. URMILKAKKAR MS. NIKITAGOYAL MR. VEDPRAKASH MS. RITIKAWASSON MS. PINKYKUMARI MR. GOURAVGOYAL MR. RAHULKUMAR MR. SOURABHBATRA MS. AAYUSHIMALANI MS. NIDHIBHUTANI MR. KAPILKUMARGUPTA MR. VINEETGUPTA MR. DEEPAKM MR. MUHAMMEDRIYASAT MS. SUSRIMULUKALAPELLY MR. SKANDANPJAIN MS. SUBASHREEM MS. PAYALASHOKBHAIDODIA MS. NIKITAJAIN MR. MAYANKVERMA MS. REKHADINESHJAISWAL MR. CHINMAYASHOKHANUMANTE DECEMBER 2016 I CHARTERED SECRETARY ACS -47670 ACS -47698 ACS -47697 ACS -47696 ACS -47695 ACS -47694 ACS -47693 ACS -47692 ACS -47691 ACS -47690 ACS -47689 ACS -47688 ACS -47687 ACS -47686 ACS -47685 ACS -47684 ACS -47671 ACS -47672 ACS -47673 ACS -47669 ACS -47668 ACS -47667 ACS -47666 ACS -47665 ACS -47664 ACS -47663 ACS -47662 ACS -47661 ACS -47660 ACS -47659 ACS -47658 ACS -47657 ACS -47656 ACS -47655 ACS -47654 ACS -47653 ACS -47652 ACS -47651 ACS -47650 ACS -47649 ACS -47648 ACS -47647 ACS -47646 ACS -47645 ACS -47644 ACS -47643 ACS -47642 ACS -47674 ACS -47675 ACS -47676 ACS -47677 ACS -47678 ACS -47683 ACS -47682 ACS -47681 ACS -47680 ACS -47679 WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC CHARTERED SECRETARY I DECEMBER 2016 117 116 DECEMBER 2016 I CHARTERED SECRETARY 207 206 205 204 203 202 201 200 199 198 197 236 210 209 208 246 245 244 243 242 241 240 239 238 237 211 248 247 235 234 233 232 231 230 229 228 227 226 225 224 223 222 221 220 219 218 217 216 215 214 213 212 249 253 252 251 250 MS. MUKTISURAVIPATRA MR. MAHATAVKUMAR MS. AYUSHIHEMENDRASHAH MS. VARTALIRAKESHMEHTA MS. MEENALKEEJA MR. DHARMIKRIPINBHAISOLANKI MS. RINKUBENAMRUTABHAIPATEL MR. RAGHAVENDRALAXMINARAYANABHAT MS. KOMALSURESHKUMARSHRIMANKAR MR. HINALKUMARVISHNUBHAIPATEL MR. HARDIKHASMUKHLALDARJI MS. RASHMIDILIPBHALERAO MR. SUBHRANSUSEKHARSAHOO MR. VARGHESETHOMAS MS. LEENACHITTI MR. NISHANTKUMARSWAMI MS. BISHAKHADEVIJALAN MS. SHRADDHABANKESHBHAISHAH MS. NISHAKIRANSHARMA MR. NISARGNILESHSHAH MR. SANDIPSUMTILALCHORDIYA MR. MAYANKAGRAWAL MR. GAUSISMAILKAMIRKAR MR. RAHULDNYANESHWARDAHAPUTE MS. ANITANAGAR MR. VIPINHARIKISANJIZANWAR MS. SNEHABAJAJ MR. RAJAP MS. SHIVANITHAKRAL MS. AKANKSHARAKESHKUMARGUPTA MR. ANKITJAIN MR. MANANJOSHI MR. KHILESHBHATIA MS. AKSHITASETH MS. MONICANANDA MS. MAMTAJAIN MS. NEHADOSI MR. TANUJKUMARSAXENA MR. ANKURPATWA MS. JYOTI MS. PURNIMACHOPRA MS. MOHINISINGHAL MR. ADITYAJAIN MS. PRIYANKAJAIN MR. ABDULQUADIR MS. PUSHPANJALIARORA MR. MOHITWILKINSON MR. SANJAYYADAV MS. SHIVANGISINGHAL MS. NISHAGULWANI MS. BARKHAJAIN MS. NEHAGUPTA CHARTERED SECRETARY MR. KAPILSINGLA MS. ANKITASAXENA MS. NEETUSHUKLA MR. BALJITSINGH MR. HIMANSHUSHARMA I DECEMBER 2016 ACS -47737 ACS -47709 ACS -47708 ACS -47707 ACS -47706 ACS -47705 ACS -47704 ACS -47703 ACS -47702 ACS -47701 ACS -47700 ACS -47699 ACS -47738 ACS -47712 ACS -47711 ACS -47710 ACS -47748 ACS -47747 ACS -47746 ACS -47745 ACS -47744 ACS -47743 ACS -47742 ACS -47741 ACS -47740 ACS -47739 ACS -47713 ACS -47750 ACS -47749 ACS -47736 ACS -47735 ACS -47734 ACS -47733 ACS -47732 ACS -47731 ACS -47730 ACS -47729 ACS -47728 ACS -47727 ACS -47726 ACS -47725 ACS -47724 ACS -47723 ACS -47722 ACS -47721 ACS -47720 ACS -47719 ACS -47718 ACS -47717 ACS -47716 ACS -47715 ACS -47714 ACS -47751 ACS -47755 ACS -47754 ACS -47753 ACS -47752 WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC SIRC SIRC EIRC SIRC EIRC EIRC SIRC SIRC EIRC 310 309 308 307 306 305 304 303 302 301 300 299 298 297 254 255 256 257 258 259 260 261 262 263 264 265 266 267 268 269 270 271 272 273 296 295 294 293 292 291 290 289 288 287 286 285 284 283 282 281 280 279 278 277 276 275 274 MS. ANKITAPANDEY MS. PRIYAMALHOTRA MS. DEEPIKABANSAL MR. AKHILESHKUMAR MS. SAKSHIPHERWANI MR. SIDDHARTHASRIVASTAVA MR. UDITDUA MS. KIRANPANDEY MS. EKTARAWAT MS. APOORVASRIVASTAVA MS. NANDANIBHARDWAJ MS. MANJUJANGID MS. JAYATIGROVER MS. SHIPRASONI MS. GAZALAGRAWAL MS. SUHASIBANTHIA MS. SNIGDHATRIPATHI MS. MONIKAAGARWAL MR. PRADEEPKUMARSAHOO MS. JAYASINGH MS. PRITHABOSE MR. SANJITBHAGAT MS. PRITIPANDEY MS. FRENNYPAREKH MS. SUMANGUPTA MS. DIPPONSEN MS. SHIKHARAI MS. PAYALMITTAL MR. MOHAMMADMENAZUDDIN MS. SONUAGARWAL MR. AMANISHKUMAR MR. NISHITRANJAN MS. NIKITASUREKA MS. GINNILOHARIWALA MR. MOHDSHARIQ MS. MEGHABISHT MR. MANISHKUMAR MS. PRIYANKAWALIA MS. YAMINIJAIN MS. MANISHAGOSWAMI MS. NEELAMVATS MR. TARUNCHAKARWARTY MS. BHANUPRIYASHARDA MS. KANIKAAGARWAL MS. NEHASHARMA MR. MANDEEPSINGH MR. SANTUMUKHERJEE MS. PRITISHARMA MS. MEENAKSHIKAUSHIK MS. SHILPASHARMA MR. SANCHITMATHUR MR. SIMRANSINGH MS. MEGHACHADHA MS. PALLAVISHARMA MS. CHETNAAGARWAL MS. RITIGARG MR. NAVEENMISHRA ACS -47812 ACS -47811 ACS -47810 ACS -47809 ACS -47808 ACS -47807 ACS -47806 ACS -47805 ACS -47804 ACS -47803 ACS -47802 ACS -47801 ACS -47800 ACS -47799 ACS -47756 ACS -47757 ACS -47758 ACS -47759 ACS -47760 ACS -47761 ACS -47762 ACS -47763 ACS -47764 ACS -47765 ACS -47766 ACS -47767 ACS -47768 ACS -47769 ACS -47770 ACS -47771 ACS -47772 ACS -47773 ACS -47774 ACS -47775 ACS -47798 ACS -47797 ACS -47796 ACS -47795 ACS -47794 ACS -47793 ACS -47792 ACS -47791 ACS -47790 ACS -47789 ACS -47788 ACS -47787 ACS -47786 ACS -47785 ACS -47784 ACS -47783 ACS -47782 ACS -47781 ACS -47780 ACS -47779 ACS -47778 ACS -47777 ACS -47776 117 WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC

NEWS FROM THE INSTITUTE NEWS FROM THE INSTITUTE 118 367 366 365 364 363 362 361 360 359 358 357 356 355 354 353 352 351 350 349 348 347 346 345 344 343 342 341 340 339 338 337 336 335 334 333 332 331 330 329 328 327 326 325 324 323 322 321 320 319 318 317 316 315 314 313 312 311 MS. CHANDNIKMOOLCHANDANI MS. ANUBHA MS. NIKITAMARWAH MS. CHANCHALGAUR MS. SHWETAJETHWANI MS. NEHAARVIND MS. DAMINIJAIN MS. GUNJANPANDEY MS. SAKSHIPASRICHA MS. BHANUPRIYABAJAJ MR. VISHWASJAIN MS. RADHIKAAGGARWAL MR. ASHUSACHDEVA MS. DEEKSHAVERMA MS. RADHASHARMA MR. ANKITSHARMA MS. SHWETAGUPTA MR. DEEPAKSINGH MR. AKARSHITKAPOOR MS. SONIATANDON MS. NAMARTAVASHISHT MR. ARJUNSHARMA MR. PRINCEMALHOTRA MR. ASHUTOSHSHARMA MS. SWINKEY MR. MANISHSHARMA MR. ANUBHHAVRAIZADA MR. ABHISHEK MR. YOGESHMATHUR MS. AMANPREETKAUR MR. RAHULSINGH MR. KARANGULATI MR. MILANSINGHSHEKHAWAT MS. PURVADWIVEDI MR. ANKURSHARMA MS. SHITALYADAV MS. SWATIJAIN MS. ANVIPARAKH MS. TANYAGROVER MR. NARAYANDUTTTIWARI MS. SURUCHIAGARWAL MR. SIDDHARTHAGGARWAL MS. SWATICHOUDHARY MS. SWETARAJPUT MS. NAMRATAVASHISTHA MR. AMITVERMA MS. BHAVNASETH MR. PRATULAGRAWAL MR. VIKASAGRAWAL MR. HITESHJAIN MR. ARPITLODHA MS. YASHIKAAGRAWAL MR. PARTHSHARMA MS. SWETASHARMA MR. ATULKRISHNAPANDEY MS. HEMLATASHARMA MS. MUKTADEBNATH ACS -47869 ACS -47868 ACS -47867 ACS -47866 ACS -47865 ACS -47864 ACS -47863 ACS -47862 ACS -47861 ACS -47860 ACS -47859 ACS -47858 ACS -47857 ACS -47856 ACS -47855 ACS -47854 ACS -47853 ACS -47852 ACS -47851 ACS -47850 ACS -47849 ACS -47848 ACS -47847 ACS -47846 ACS -47845 ACS -47844 ACS -47843 ACS -47842 ACS -47841 ACS -47840 ACS -47839 ACS -47838 ACS -47837 ACS -47836 ACS -47835 ACS -47834 ACS -47833 ACS -47832 ACS -47831 ACS -47830 ACS -47829 ACS -47828 ACS -47827 ACS -47826 ACS -47825 ACS -47824 ACS -47823 ACS -47822 ACS -47821 ACS -47820 ACS -47819 ACS -47818 ACS -47817 ACS -47816 ACS -47815 ACS -47814 ACS -47813 WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC 424 423 422 421 420 419 418 417 416 415 414 413 412 411 378 377 376 375 374 373 372 371 370 369 368 379 380 381 382 383 384 385 386 387 388 389 390 391 392 393 394 395 396 398 397 399 400 401 402 403 404 405 406 407 408 409 410 MS. PRIYANKASENGAR MR. SHANTANUDATTATRAYAJAGTAP MS. NIDHINITINKUMARSHAH MR. ROHITTEKCHANDJHAMNANI MS. BHAKTIHEMANTSHUKLA MR. SWAROOPPRAKASHKALE MR. ROHITKUMARVIKASPINGALE MS. SUJATAKORVI MR. REKHARAJARAMDHEKALE MR. PARAGACHYUTKUMARBHATT MR. PRAVINMAHADEVPANHALKAR MS. KAVITAARUNBACHATE MR. YOGENDRAOMPRAKASHSHARMA MR. MOHAMMEDGOUSCHANDPASSHASHAIKH MS. NIRMALALAKSHMIV MR. UBHARATKURUP MS. PRIYANKA MR. YASPALSINGH MS. BHAGYASHREEVASWANI MS. MANISHAYADAV MR. VINEETKUMAR MR. SHUBHAMSHUKLA MS. RICHAGOYAL MS. NISHAKHATTAR MS. SHIVANISHARMA MS. AYUSHIJAIN MR. NSIVARAM MR. BETHIREDDYTATA MR. SHAIKHAMARHUSSAIN MR. KIRANMKRISHNAN MS. PRADEEPTHISUNKU MR. RAMKUMARJAGANNATHAN MS. ISHAMEKLASPUR MR. MAMILAPALLIRAVINDRA MS. AMREENGULNAAZ MR. RAVIBSG MR. JOFINJOHN MS. MNEEHARIKA MR. SVENKATESH MR. SHRIDHAR MR. RPRAMODKUMAR MR. ILLANAVEENSEKHAR MR. DHEERAJTIWARI MR. VENKATANARESHG MR. RCHANDRASEKHAR MR. HARISH MR. PRASADARAOKALLURI MR. NIHARIKAV MS. NUTIKAJAIN MS. ARPITHAAPATTAR MS. MANISHAGAJANANJAWALE MS. HARSHINIM MS. SNEKHAS MS. GAYATHRIS MS. RAMYAINALA MS. KALPANAM MS. SOUMYASAHOO DECEMBER 2016 I CHARTERED SECRETARY ACS -47913 ACS -47926 ACS -47925 ACS -47924 ACS -47923 ACS -47922 ACS -47921 ACS -47920 ACS -47919 ACS -47918 ACS -47917 ACS -47916 ACS -47915 ACS -47914 ACS -47912 ACS -47880 ACS -47879 ACS -47878 ACS -47877 ACS -47876 ACS -47875 ACS -47874 ACS -47873 ACS -47872 ACS -47871 ACS -47870 ACS -47881 ACS -47882 ACS -47883 ACS -47884 ACS -47885 ACS -47886 ACS -47887 ACS -47888 ACS -47889 ACS -47890 ACS -47891 ACS -47892 ACS -47893 ACS -47894 ACS -47895 ACS -47896 ACS -47897 ACS -47898 ACS -47900 ACS -47899 ACS -47901 ACS -47902 ACS -47903 ACS -47904 ACS -47905 ACS -47906 ACS -47907 ACS -47908 ACS -47909 ACS -47910 ACS -47911 WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC EIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC CHARTERED SECRETARY I DECEMBER 2016 119 118 DECEMBER 2016 I CHARTERED SECRETARY 481 480 479 478 477 476 475 474 473 472 471 470 469 468 467 466 465 464 463 462 461 460 459 458 457 456 455 454 453 452 451 450 449 448 447 446 445 444 443 442 441 440 439 438 437 436 435 434 433 432 431 430 429 428 427 426 425 MS. SHWETABHAMARE MS. SURABHITANTED MS. SHAHNIHARIKARAJESHBHAI MS. SEJALMOTIBHAIKANABI MS. MANPREETKAURHORA MR. TOSHIKHITENDRASHAH MS. LATAPARMANANDBHATT MS. MADHURDAYARAMMITTAL MS. ANJALISURESHCHANDKHABANI MR. JAGDISHSHAMJIBHAIKANZARIYA MR. PARINNAYANKUMARSHAH MS. AKANKSHARAI MS. SONAMRAGHUVANSHI MS. RANDEEPKAURPURI MS. CHEMMEENANSHUMALIRUPAREL MR. SOMESHCHANDRASHEKHARKALE MR. NIRANJANKUMAR MS. KARISHMANARAYANMAKHIJA MR. NITESHARUNRAOUMATE MS. SUCHETARAGHUVENDRACHATURVEDI MR. VINODKANUBHAIRANA MS. THAKKARHIMALIMAHESHKUMAR MR. DEVESHSURESHBHAIJOSHI MR. JEETENDRAROCHIRAMKESWANI MS. PREETIROHITBHALA MR. GANESHSAMPATBHANDURE MS. ANKITAKIRITBHAIPOPAT MS. TANVIKANAVINRAICHANA MR. VISMAYKIRTANKUMARSHAH MR. JAYESHLAXMANBHAWASAR MR. NILESHBHAGWATTAYADE MS. SURBHILALITBOHARA MR. NILESHCHANDRAKANTPARKAR MS. KASHISHVIJAYVARGIYA MR. GANESHMITTHULALGARKATE MS. BHAIRAVIANILKULKARNI MS. YASHODHARAULHASAGASHE MR. DASHANGMANHARLALKHATRI MR. VINODKUMARSHARMA MR. CHETANRAMNIKBHAIPUMBHADIYA MS. RASNARAGHUPATEL MR. ANIKETAMRUTKARMALI MR. MOHAMMADNADEEM MR. SANDEEPAWDHESHDUBEY MR. PARTHMUKESHMEHTA MR. VIJAYRAMCHANDRAALIMKAR MR. HEMILMUKESHKUMARSHAH MS. MEETALIUMESHMISTRY MR. NARENDRAKUMARGUPTA MR. ANKITMITTAL MR. RAVIGUPTA MS. SNEHALRAJGOPALHEDA MS. PRIYANKAHARSUKHBHAIGOHEL MR. JAYDEVBHARATBHAISHUKLA MS. MAHAJANANITASRIKANT MR. VAIBHAVKANTILALDODIA MS. NEHAAVINASHMARATHE CHARTERED SECRETARY I DECEMBER 2016 ACS -47983 ACS -47982 ACS -47981 ACS -47980 ACS -47979 ACS -47978 ACS -47977 ACS -47976 ACS -47975 ACS -47974 ACS -47973 ACS -47972 ACS -47971 ACS -47970 ACS -47969 ACS -47968 ACS -47967 ACS -47966 ACS -47965 ACS -47964 ACS -47963 ACS -47962 ACS -47961 ACS -47960 ACS -47959 ACS -47958 ACS -47957 ACS -47956 ACS -47955 ACS -47954 ACS -47953 ACS -47952 ACS -47951 ACS -47950 ACS -47949 ACS -47948 ACS -47947 ACS -47946 ACS -47945 ACS -47944 ACS -47943 ACS -47942 ACS -47941 ACS -47940 ACS -47939 ACS -47938 ACS -47937 ACS -47936 ACS -47935 ACS -47934 ACS -47933 ACS -47932 ACS -47931 ACS -47930 ACS -47929 ACS -47928 ACS -47927 WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC 537 536 535 534 533 532 519 518 517 516 515 503 502 501 500 499 498 497 496 495 494 493 492 491 490 489 488 487 486 485 484 483 482 527 526 525 538 524 523 522 521 520 504 528 505 531 530 529 507 506 508 512 511 510 509 513 514 MR. RADHAKANTADAS MS. PURVINARENDRASHAH MS. NISHAKAMLESHMEGHRAJANI MR. ARJAVHIRENBHAITRIVEDI MR. BHAVESHSHAMJICHHEDA MS. MONAMODY MR. NITISHKUMAR MS. PAYALVIG MS. POOJACHAUHAN MR. HASMUKHBHUDARBHAIPRAJAPATI MS. KRISHNABENJAYASHBHAIPAREKH MR. SHIVDARSHANANNARAOMORKHANDE GANDHI MR. ANKURKUMARDINESHCHANDRA MR. CHANDRASEKHARTUMULA MR. SUNILKHATRI MS. KAJALSHAMHANDE MR. BHAVINNILESHPANDYA MR. KRUNALHIRALALJAIN MS. ARCHANAKANYALALGOPLANI MS. DRASHTIPRAGNESHSURTI MR. ROHANSUBHASHANAND MR. RONAKJAYESHBHAIDHRUVE MS. SHALAKACHOUDHARY MS. DEVIKASINGH MR. TANMAYPRASHANTKUMARMEHTA MS. NUPURSURESHBHATTAD MS. PRITINITYANANDAROY MS. NIKITAMUKESHBARBHAYA MR. AMANJAYESHDESAI MS. PHALAKMAMTAHIRAMAN MS. SAKSHIMEHTA MS. DHARAPARINPATEL MR. DARSHILANILHIRANANDANI MR. AMANRAI MS. ANKITAGUPTA MR. MUSTIVSAMKRISHNA MR. CHETANKUMAR MS. SIDDHIANAND MR. ABHIJITROY MR. SATPREETSINGH MR. SOURABHSHARMA MR. DEEPAKASWANI MS. RASHMI MS. ANUSIDANA MR. EVVIJAYAPHANIPRATAP MR. TVENKATESHULUTALURI MR. BINEESHKUMARPS MS. YOGINIMILINDGOKHALE MS. RATIKARAJKUMARBATHAM MR. MEDAMCHOWDAREDDY MR. KETANKISHORSHEVDE MR. SRIRAMPOLAMRAJU MR. SUMITKUMARBHATTACHARJEE MS. ANJUBANSAL MR. MILINDSURYAKANTRAO MR. PRATIKROHITTOPRANI MR. ANJANIKUMARSUREKA ACS -48033 ACS -48016 ACS -48039 ACS -48038 ACS -48037 ACS -48036 ACS -48035 ACS -48034 ACS -48021 ACS -48020 ACS -48019 ACS -48018 ACS -48017 ACS -48005 ACS -48004 ACS -48003 ACS -48002 ACS -48001 ACS -48000 ACS -47999 ACS -47998 ACS -47997 ACS -47996 ACS -47995 ACS -47994 ACS -47993 ACS -47992 ACS -47991 ACS -47990 ACS -47989 ACS -47988 ACS -47987 ACS -47986 ACS -47985 ACS -47984 ACS -48029 ACS -48028 ACS -48027 ACS -48040 ACS -48026 ACS -48025 ACS -48024 ACS -48023 ACS -48022 ACS -48006 ACS -48030 ACS -48007 ACS -48032 ACS -48031 ACS -48009 ACS -48008 ACS -48010 ACS -48014 ACS -48013 ACS -48012 ACS -48011 ACS -48015 119 WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC EIRC EIRC SIRC SIRC EIRC SIRC SIRC SIRC SIRC SIRC EIRC EIRC

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JAYESHS MS. SIREESHAPRAKHYA MR. KVAMSIKRISHNA MR. NMEHERPRASAD MR. BALAKRISHNANAP MR. MANMOHANSHARMA MS. ANJUKUMARI MS. SRIJAS MS. PRIYANKAAGARWAL MR. YOGESHKANKANI MS. HIRALBHUPENDERAKUMARSHAH MR. MANISHKUMARJAIN MS. SHEETALAMITMARATHE MS. PRACHIUMESHSHAH MS. JEEGESHAJAGDISHDOSHI ACS -48096 ACS -48097 ACS -48041 ACS -48042 ACS -48043 ACS -48044 ACS -48045 ACS -48046 ACS -48076 ACS -48075 ACS -48074 ACS -48073 ACS -48072 ACS -48071 ACS -48070 ACS -48069 ACS -48068 ACS -48067 ACS -48066 ACS -48065 ACS -48064 ACS -48063 ACS -48062 ACS -48061 ACS -48060 ACS -48059 ACS -48058 ACS -48057 ACS -48056 ACS -48055 ACS -48054 ACS -48053 ACS -48052 ACS -48051 ACS -48050 ACS -48049 ACS -48048 ACS -48047 ACS -48077 ACS -48078 ACS -48079 ACS -48080 ACS -48081 ACS -48082 ACS -48083 ACS -48084 ACS -48085 ACS -48087 ACS -48086 ACS -48088 ACS -48089 ACS -48090 ACS -48095 ACS -48094 ACS -48093 ACS -48092 ACS -48091 WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC EIRC EIRC EIRC EIRC EIRC EIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC 628 627 626 625 624 623 622 621 620 619 618 617 616 615 614 613 612 611 610 609 608 607 606 605 604 603 649 648 647 646 645 644 643 642 641 640 639 602 601 600 599 598 597 596 636 635 634 633 632 631 630 629 650 637 651 638 652 MR. PVIVINMALLY MS. SHILPIKAMLESHBHAISHETHWALA MS. PRIYAPRAGNESHSHAH MR. RATHOREJAIOMNARENDRA MS. SHREYARAJENDRABHAITHAKKAR MR. SHIVAMPRAKASHBHAIBHATT MS. SHREYAMILANKUMARSHAH MR. AKASHGANESHANCHAN MS. FORAMBHUPENDRABHAIPARMAR MS. ZILJITENDRABHAVSAR MS. SHEFALIBHARATTHAKKAR MS. RADHIKAVIMALTIBREWALA MR. BHUPENDRAKUMARGUPTA MS. JINALAJAYBHAIMEHTA MR. KIRITKANTILALDHAROD MS. AVANIMANOJMAKWANA MS. SUJATAGIRIDHARPARAB MS. SHUBHIKAMODI MS. RAMYANAIR MR. TEJUSRAMCHANDRAPITHADIYA MR. SONESHJAIN MS. POOJAPANKAJBHAISEJPAL MS. HIRALKANUBHAIGEDIYA MS. KOMALRAMKISHORSHARMA MR. NIKUNJVASANTBHAIPATEL MR. ABHILASHDAS MR. MANEESHVERMA MR. AMEYSURESHNAIK MS. ANAMIKAGUPTA MR. VINITVIRAGDESHMUKH MS. TARLEENSURINDERPALSINGHANAND MR. PRATHAMESHRAMCHANDRAPENDHARKAR MR. CHINMAYMAYANKKUMARMETHIWALA MR. NARENDRADEVNATHOJHA MS. PRIYAGUPTA MS. DIVYAAGRAWAL MR. ARUNKUMAR MR. ARJUNBANSAL MS. REKHAJINDAL MR. CHETANBHARATKHALADKAR MR. DHRUMILSUDHIRBHAIKOTHARI MS. PRERNAJAIN MR. VATSALYASHARMA MR. PINAKSHASHIKANTSONI MS. MEENALANILDABHADE MS. NIKITALODHA MR. SAGARKUMARNATVARLALTAILOR MS. DURGA MR. PARESHDEVIDASDESHPANDE MR. LOKHANDESAGARSHRINATH MR. VIPINKUMARKATIYAR MR. KEWALKUNTIANAND MR. BHUSHANKISHORJOSHI MS. BARSHADIKSHIT MS. KALPANARAWAT MS. SNEHAAGARWAL MS. MADHURIPANDEY DECEMBER 2016 I CHARTERED SECRETARY ACS -48130 ACS -48129 ACS -48128 ACS -48127 ACS -48126 ACS -48125 ACS -48124 ACS -48123 ACS -48122 ACS -48121 ACS -48120 ACS -48119 ACS -48118 ACS -48117 ACS -48115 ACS -48114 ACS -48113 ACS -48112 ACS -48111 ACS -48110 ACS -48109 ACS -48108 ACS -48107 ACS -48106 ACS -48105 ACS -48116 ACS -48104 ACS -48146 ACS -48151 ACS -48150 ACS -48149 ACS -48148 ACS -48147 ACS -48145 ACS -48144 ACS -48143 ACS -48142 ACS -48141 ACS -48140 ACS -48103 ACS -48102 ACS -48101 ACS -48100 ACS -48099 ACS -48098 ACS -48138 ACS -48137 ACS -48136 ACS -48135 ACS -48134 ACS -48133 ACS -48132 ACS -48131 ACS -48152 ACS -48139 ACS -48153 ACS -48154 WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC EIRC EIRC EIRC EIRC EIRC EIRC EIRC CHARTERED SECRETARY I DECEMBER 2016 121 120 DECEMBER 2016 I CHARTERED SECRETARY 706 705 704 703 702 701 700 699 698 697 696 695 694 693 692 707 653 708 656 655 654 709 665 664 663 662 661 660 659 658 657 674 673 672 671 670 669 668 667 666 675 676 677 678 691 690 689 688 687 686 685 684 683 682 681 680 679 MS. MANALIRAJENDRAKUMARKOTHARI MS. VINITABANSILALBHOJWANI MS. NIDHIBIPINPOPAT MS. CHARMINARSHIVASANI MS. DIMPLEAMRITPARMAR MS. KALYANIRAMESHRASANE MS. RUTUPANKAJBHAISHAH MS. POONAMVILASKADAM MS. NIKITAPRAKASHBHATIA MS. ANKITAAJITBHATIA MS. MITALIRAJENDRASHAH MS. PAYALANILMALHOTRA MR. NITINPATIDAR MS. PARITADAVE MR. MUSINAMNAGARAJU MS. KUMARILEKHASHARMASHIVDHANIBHAI MR. VARUNSURENDRAKUMARAGRAWAL MS. BARSHAAGARWAL MR. VENKATESHPC MS. GEETARANIGUPTA MR. ADITYASHROTRIYA MS. CHAHATDHAWAN MR. SANJEEVKUMAR MS. KHUSHBOOJAISWAL MS. BHAWNASRIVASTAVA MS. DOLLYSHARMA MS. SHWETASHARMA MR. CHANDERSHEKHAR MR. GANESHPARSAD MR. RAVITRIPATHI MS. BEENARANI MR. ROHITCHOPRA CHARTERED SECRETARY MR. GURUPRASADABHAT MR. AKHILGUPTA MS. SAKSHIBANGAR MS. SWEETYCHAUHAN MS. RENUPANDEY MS. NEHAANUJ MR. GAURAVMATHUR MS. SHIVANIARYA MS. KOMAL MR. SANTOSHSANGANNASHADADAL MR. PRAVEENM MR. SHANKARMALAGI MS. NETHRAJ MS. ANUESHKAVILASPAVASKAR MS. KAJALVISHNUKUMARMEWADA MS. GARGINATH MS. KIRTIARJUNBHARTIYA MS. ANITASHRIKANTDONGRE MR. TEJASPRAKASHWADKE MS. MAMTAKABRA MR. MANISHTARACHANDPANDE MS. SHRUTISUBHASHNILEKANI MR. LEKHPAL MS. PRITIBHANDARI MS. GARIMATIWARI I DECEMBER 2016 ACS -48207 ACS -48206 ACS -48205 ACS -48204 ACS -48203 ACS -48202 ACS -48201 ACS -48200 ACS -48199 ACS -48198 ACS -48197 ACS -48196 ACS -48195 ACS -48194 ACS -48193 ACS -48208 ACS -48209 ACS -48155 ACS -48210 ACS -48158 ACS -48157 ACS -48156 ACS -48211 ACS -48167 ACS -48166 ACS -48165 ACS -48164 ACS -48163 ACS -48162 ACS -48161 ACS -48160 ACS -48159 ACS -48176 ACS -48175 ACS -48174 ACS -48173 ACS -48172 ACS -48171 ACS -48170 ACS -48169 ACS -48168 ACS -48177 ACS -48178 ACS -48179 ACS -48180 ACS -48192 ACS -48191 ACS -48190 ACS -48189 ACS -48188 ACS -48187 ACS -48186 ACS -48185 ACS -48184 ACS -48183 ACS -48182 ACS -48181 WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC SIRC EIRC SIRC SIRC EIRC SIRC SIRC SIRC SIRC SIRC RESTORED* # *RESTORED FROM 01.10.2016 TO31.10.2016 ISSUED* OF PRACTICECERTIFICATE ISSUED DURINGTHE MONTHOFOCTOBER,2016 NO. 710 713 712 711 714 715 717 716 NO. SI. 25 27 26 24 23 22 21 20 19 17 18 16 15 13 12 30 14 11 10 29 28 S. 1 2 3 8 7 6 5 4 9 8 7 6 5 4 3 2 1 NAME SH. UMESHKUMARVASANTRAYBHATT MS. MANALISHIRISHBHAISHAH MR. SONDIPGOSWAMI MR. RUTESHKISHORBHAICHOKSI MS. DISHAMAHESHWARI MR. ROHITJAGDISHASRANI MR. DHANANJAYJITESHPANDEY MS. VISHAKHATANWAR MS. LAKSHMIELESWARAPU MR. AJAYMISHRA MS. SHAMALANANTMAHAPADI MR. ABHISHEKKUMAR MR. AMITCHAKRABORTY MS. RADHIKARAMESH MS. RADHIKADAVE MS. MADHUASHOKKUMARKOTWANI A/F A A A A A A A A A A A A A A A A A A A A A A A A A A F F F F 10199 16266 13720 31506 11291 23261 20119 21714 15567 33888 12603 16104 10354 17143 17549 36112 19438 28089 MEM. 4669 7145 5325 1147 2168 5043 8357 6616 9125 2582 6194 NO. 600 MOHAMMAD SALIM ANUMEHA SONI I SREEDEVI SHARAT CHANDRAROONGTA RADHIKA YOGESHKABADE JAYAPRAKASH MPAI KARTHIK KRISHNAN S VRAJAVAIDYANATHAN DEOKINANDAN DEORA RACHNA AGARWAL R SUBRAMANIAN KUMAR DKAPASI K SUNDARASATAGOPAN SANTOSH KUMARMISHRA SANJAY KHATTRY R BKABRA DEEPKUMAR VINITCHANDRAAGRAWAL S. RAMESH ARVINDKUMAR SANJAI MAHESHWARI NATARAJAN SUBBARAMAN YASHPAL AJIT RAMAMURTHYVARANASI JYOTI KABRA A PAZHANIRAJU PRIYANKA AGARWAL APARNA DATTATRYAKARMASE ANAND SWARUPVARMA MEM. NAME SUDHIR MAHESHWARI MANGALA SACHINSAVLA ACS - 32329 ACS - 32710 ACS - 47196 ACS - 46783 ACS - 46540 ACS - 45587 ACS - 40517 FCS -8961 MEMBNO ACS -48212 ACS -48215 ACS -48214 ACS -48213 ACS -48216 ACS -48217 ACS -48219 ACS -48218 121 REGN. WIRC WIRC WIRC NIRC NIRC NIRC SIRC EIRC WIRC WIRC WIRC PLACE NIRC SIRC EIRC EIRC SIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC 17308 17309 17314 17312 17315 17313 17311 17310 SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC EIRC EIRC COP NO.

NEWS FROM THE INSTITUTE NEWS FROM THE INSTITUTE 122 45 44 43 42 41 62 61 60 46 35 34 33 11 10 14 13 64 63 50 49 48 47 40 39 38 37 36 12 15 65 53 52 51 16 55 54 26 25 24 23 22 21 20 19 18 17 56 32 31 30 29 28 27 57 59 58 9 MS. GEETHIKAJ MR. VIJAYKUMAR MS. TANIKABHARGAVA MS. POONAMSHARMA MR. SHOBHITKUMARKUSHWAHA MS. USHAGANAPATHYSUBRAMANIAN MR. SINGHSANDEEPKUMARAWADESH MR. THIRUVALLUVANTHULASIRAMAN MR. MURALEEDARANGAURAVNAYAK MS. NIDHIKHANDELWAL MS. KANIKACHHABRA MS. PINKY MR. JOBINJOSE MS. KSSUNITHA SH. PRASHANTSMEHTA SH. DILIPKUMARCHUNILALSHAH MR. ROHANANANDVATS MS. PRAMESHRAJKUMARPANWAR MS. ANISASUHENA MS. ASTHABARANAWAL MS. NEHAGUPTA MS. PRIYANKAKOTHARI MR. AVINASHRAJUV MS. MISHIKACHHABRA MS. SHIVANIDHASMANA MR. JATINLAKHISARANI MS. SHRUTIKAKHANNA MS. ADITIBANSAL MS. PINKYDINESHSHETHIA MS. RIDDHIBADIYANI SH. BPBHARGAWE MS. NEHASOMANI MR. RAMESHA MR. SUMANKUMARMISHRA MS. SWATIJAGATI MS. SHAHKAJALDILIPKUMAR MRS. ANJANASHOMIKGHOSAL MR. KARUPPIAHBUVALENDRAN MR. DILIPKUMARCHOUDHARY MS. SRIKANTAPUGALIA SH. LALITNARAYANSINGH MS. NIDHIARORA MS. RAJNISHARMA MR. JATINDERKUMAR TIWARI MR. VIPINMAHENDRAKUMAR MS. PALLAVIGUPTA MS. KANCHANANIRUDHALIMAYE SH. MOHANRAOPONNAGANTI MS. RITIKAGOEL MR. DAYASHANKAR MS. PALLAVIKETANTHAKUR MR. PRATEEKNAHATA MR. RAHULSHARMA MR. ASHWINDERSINGH MS. ANUBHAMAHESHWARI MS. ROOPASIDDAPPA MS. GURDEEPSALUJA ACS - 42996 ACS - 40118 ACS - 38112 ACS - 38633 ACS - 46660 ACS - 36352 ACS - 47284 ACS - 47202 ACS - 26293 ACS - 37896 ACS - 34996 ACS - 32150 ACS - 43406 ACS - 15358 ACS - 27735 ACS - 47227 ACS - 44042 ACS - 38506 ACS - 42016 ACS - 39879 ACS - 46429 ACS - 46214 ACS - 45445 ACS - 44996 ACS - 31229 ACS - 30121 ACS - 29237 ACS - 28686 ACS - 44522 ACS - 42943 ACS - 47065 ACS - 47034 ACS - 39934 ACS - 46066 ACS - 47306 ACS - 47140 ACS - 43471 ACS - 16623 ACS - 47238 ACS - 47139 ACS - 44082 ACS - 40765 ACS - 36646 ACS - 28790 ACS - 47130 ACS - 47307 ACS - 47246 ACS - 47009 ACS - 46122 ACS - 46111 ACS - 45361 ACS - 27844 ACS - 24396 ACS -5814 ACS -2678 FCS -3410 FCS -4643 WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC SIRC SIRC SIRC SIRC SIRC SIRC SIRC EIRC SIRC EIRC EIRC EIRC SIRC EIRC SIRC EIRC SIRC EIRC EIRC SIRC 17351 17350 17349 17348 17347 17368 17367 17352 17341 17340 17339 17317 17316 17366 17320 17319 17370 17369 17356 17355 17354 17353 17346 17345 17344 17343 17342 17318 17321 17371 17359 17358 17357 17322 17372 17361 17360 17332 17331 17330 17329 17328 17327 17326 17325 17324 17323 17362 17338 17337 17336 17335 17334 17333 17363 17365 17364 103 102 101 100 121 113 112 111 110 109 108 107 106 104 123 122 118 117 116 115 114 105 119 120 93 94 95 96 98 97 99 81 80 79 78 77 74 73 82 75 83 76 84 89 90 91 92 86 85 87 88 68 67 66 69 70 71 72 MR. SUNILMULCHANDANI MS. AARTIMAHENDRAKUMARJAIN MS. HEENAPUKHRAJJAIN MR. SHASHIKANTRANJAN SH. VINODKUMARRUNGTA MR. AYUSHGUPTA MS. ANJALIGOYAL MS. NEHAGOYAL MS. JYOTIVINODKUMARAGARWAL MS. NEHASHARMA MS. RENUJAIN MS. AAYUSHIAGRAWAL MR. SACHINHUKUMCHANDSHARMA MS. POOJASONI MR. HARSHSEHRAWAT MR. ASHISHKUMAR MS. DIPIKADILIPKOTHARI MS. SAKSHIRAJPUT MR. ARUNKUMAR MS. SUKRITIMANNA MR. SPARSHMAHESHGUPTA MR. ABHISHEKAGARWAL MR. MITHAIWALA RAHUL SURENDRABHAI MR. PRITESHKUMARPRIYADARESEE MR. CHAITANYACHANDRASHEKHARKULKARNI MS. ARPITANANDKUMARJALNAWALA MR. ANANDKUMARCHAINSUKHKASAT MR. DHRUVBHARATBHAIPATEL MR. KAMLESHYADAV MS. RIDDHIGOVINDKHANEJA MR. NANDKUMARDADASOPATIL MRS. SHIFABADRI MS. NIDHIBAGLIKAR MS. AAREFAOANALIDUDHWALA MS. RADHIKAYOGESHKABADE MS. DEEPABISHT MR. SANJAYKISHORDINGARE MR. MANISHMADHUKARRAJVAIDYA SH. YOGESHKUMARCHOUHAN MR. HEMANTSHARMA MS. KAMIYA MS. RAMASHARMA MS. SNEHAAGARWAL MR. PARTHPIYUSHSHARMA MS. SHIRINKAURKOHLI MS. DIVYAJAIN MS. BHAVYASHARMA MS. PALANISAMYSATHYASUNDARI MS. AKANSHASINGHAL MS. POONAMMOHTA MS. NIDHIAGARWAL MR. BATCHUKALYAN MS. POOJADATTA MS. ANJALIAILAWADHI MS. KAMINIKUMAWAT MS. DEEPIKA MR. VISHALTHAWANI MR. GAURAVAGGARWAL DECEMBER 2016 I CHARTERED SECRETARY ACS - 36327 ACS - 37004 ACS - 40005 ACS - 44636 ACS - 47453 ACS - 47220 ACS - 46898 ACS - 46386 ACS - 44854 ACS - 46454 ACS - 46686 ACS - 46024 ACS - 44189 ACS - 46297 ACS - 46258 ACS - 42078 ACS - 46900 ACS - 46766 ACS - 46337 ACS - 47263 ACS - 44596 ACS - 44290 ACS - 46918 ACS - 45394 ACS - 46986 ACS - 47316 ACS - 47383 ACS - 47395 ACS - 35651 ACS - 34904 ACS - 40094 ACS - 37110 ACS - 31506 ACS - 31179 ACS - 28541 ACS - 29168 ACS - 18669 ACS - 42264 ACS - 46500 ACS - 46463 ACS - 45611 ACS - 47480 ACS - 45132 ACS - 44985 ACS - 44168 ACS - 47341 ACS - 47333 ACS - 46078 ACS - 47378 ACS - 43697 ACS - 43350 ACS - 43230 ACS - 43934 ACS - 43938 ACS - 43997 FCS -7965 FCS -8877 FCS -417 WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC EIRC SIRC SIRC EIRC EIRC EIRC SIRC EIRC SIRC EIRC SIRC 17399 17400 17401 17402 17403 17409 17408 17407 17404 17405 17406 17383 17386 17379 17387 17385 17384 17380 17427 17388 17381 17389 17382 17390 17395 17396 17397 17398 17416 17413 17412 17419 17418 17417 17415 17414 17410 17430 17429 17423 17421 17428 17424 17422 17420 17391 17392 17411 17425 17393 17426 17394 17374 17373 17375 17376 17377 17378 CHARTERED SECRETARY I DECEMBER 2016 123 122 DECEMBER 2016 I CHARTERED SECRETARY ADMITTED LICENTIATE ICSI CANCELLED # *CANCELLED DURING THEMONTHOFOCTOBER,2016 ADMITTED DURINGTHE MONTHOFOCTOBER,2016 No SL. NO. 144 132 131 130 129 128 127 126 125 124 133 139 138 137 136 135 134 140 143 142 141 S. 9 8 7 6 5 4 3 2 1 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 MR. ANILAGARWAL MR. RAJESHBADAMI MS. MEGHNAJHAWAR MR. VIKASJAIN MR. PANKAJYADAV MR. VIHANGPHALGOONDESAI MS. HIMANIKAMALKUMARTRIPATHI MR. SHAILESHKUMARJAIN MR. VICKYJAIN MS. MONIKARATHORE MR. KULDIPSINHJAYENDRASINHZALA MS. THIRUMAGALA MS. RICHAAGARWAL MS. RADHIKAMEENAKAR MR. SAURABHPANDE MR. VIKASSHARMA MS. NIDHISHARMA MS. SEJALBENGIRISHBHAISONI MS. SHRISTIGARG MR. NITINSUDAMYADAV MR. VAIBHAVGARG MR. KULDEEPKUMARDANGI MS. MEGHNASURESHMISTRY MS. YUKTIMORE MS. SHALINIVIJAYKUMARKOTA MR. SANJEEVNAHATA MS. ANKITABAHETY MR. ADWAITSANJAYWALUNKAR MR. UNNIKRISHNANVENUGOPALAN MR. ANSHUMANBARUAH MS. ANJALIGROVER MS. REENAANEJA MS. RAMANDEEPKAUR MR. ROHITSUDARSHANKASAT MS. NEELAMKUMARIJAIN MR. NEERAJPURI MR. PAWANSHARMA MR. MASISH MS. IYAPPANKANNAN NAME CHARTERED SECRETARY LICENTIATE 6893 6892 6891 6890 6889 6888 6887 6886 6885 NO. # * MS. KAVYAAG MS. SUSOVITATRIPATHY MR. ANKITKUMARJAIN MS. PRANEETHAKOTRA MR. VISHALMALHOTRA MS. AVANTIKASARDA MR. YASHSUNILKABRA MS. DEEKSHAJANIANI MR. DEEPAKN NAME I DECEMBER 2016 FCS 1701 ACS 43683 ACS 36427 ACS 42656 ACS 17374 ACS 42177 ACS 22918 FCS 8129 ACS 30632 FCS 5349 FCS 6688 ACS 35850 ACS 41612 ACS 44887 ACS 45591 FCS 5641 FCS 7146 ACS 40603 NO. MEMB. ACS - 47599 ACS - 47574 ACS - 30389 ACS - 27200 ACS - 45532 ACS - 47262 ACS - 47479 ACS - 47477 ACS - 47424 ACS - 47194 ACS - 46925 ACS - 39422 ACS - 47418 ACS - 39528 ACS - 37698 ACS - 27430 ACS - 25505 ACS - 47193 ACS - 47506 ACS - 47555 ACS - 47518 16100 15809 15774 17146 11282 13675 13712 15376 15928 17234 16657 16226 4310 8309 8341 9095 5127 8241 COP WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC WIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC NIRC SIRC SIRC EIRC EIRC NO REGION WIRC WIRC WIRC NIRC SIRC EIRC EIRC SIRC SIRC NIRC WIRC WIRC WIRC EIRC SIRC WIRC SIRC EIRC NIRC NIRC WIRC WIRC WIRC NIRC NIRC SIRC SIRC REGN. 17451 17450 17438 17437 17436 17435 17434 17433 17432 17431 17439 17445 17444 17443 17442 17441 17440 17446 17449 17448 17447 011-45341063. For queriesifany,pleasecontact ontelephoneno: [email protected]. please besenttotheMembershipsectionatemailid non-members. Requestalongwiththepaymentmay for acostofRs.250/-membersand500/- CDs areavailableattheheadquartersofInstitute Members oftheInstituteason1stApril,2016.The The InstitutehasbroughtoutaCDcontainingListof on Telephone:011-45341088. email id:[email protected] For furtherinformation,memberscanwriteat Tax Act,1961. for deductionunderSection80GoftheIncome The subscription/contributiontoCSBFqualify 31st December,2016. one-time online/offlinepaymentofRs.7,500by opportunity tosubscribeCSBFbymakinga become alifememberofCSBFmayavail Members oftheInstitutewhoareyetto subscription totheCSBFwillbeRs.10000. Effective from1stJanuary,2017,one-time deserving cases). payable tothedependentspouseonly(in been increasedfromRs.2lakhto3lakh, quantum offinancialassistancehasalso of CSBF(abovetheage60years), In caseofunfortunatedeathalifemember age of60years). unfortunate deathofalifemember(uptothe increased fromRs.5lakhto7.5inthe of thelifemembersCSBFhasbeen of financialassistancetothedependent(s) Effective from1stJanuary,2017,thequantum on orbefore31stDecember,2016!! from Rs.7500toRs.10000.EnrolQuickly, lakh toRs.7.5lakh;subscriptionincreases Assistance fromCSBFincreasesRs.5 From 1stJanuary,2017,Financial ATTENTION MEMBERS ATTENTION MEMBERS 123

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NO.41-9-27,RAMALAYAMSTREET,NEARFIRESTATION, V SNAGARAJUNARAMSETTI 01-MAY, T.B.SAPRUROAD,CIVILLINES,ALLAHABAD-211002 TANMAY CHATTERJEE F-202, SUDERSHANPARK,NEARMOTINAGAR,NEWDELHI-110015 SUNNY GULATI NAGAR, MAYURVIHARPHASE-1,DELHI-110091 OFFICE NO.10,FIRSTFLOOR,37,KRISHNAPLAZA,PRATAP STUTI SAXENA GURGAON-122002 UNIT NO.7,14THFLOOR,BUILDING9B,DLFCYBERCITYPHASE3, SNEHLATA MISHRA VISAKHAPATNAM-530022 54-11-16/1/1, SWEETHOMEAPTS,MADDILAPALEM,ISUKATHOTA, SMRUTHI SREECHUNDRUI BODAKDEV ,AHMEDABAD-380054 G HIGHWAY 306, SHAPATH-3,NEARGNFCTOWER,PAKWANCROSSROAD,S SHYAMSINGH RANSINGHTOMAR 96, ARAVALIAPARTMENTS,ALAKNANDA,NEWDELHI-110019 SHYAM ARORA DELHI-110092 F-144 B,4THFLOOR,MANGALBAZAR,LAXMINAGAR, SHOBHIT TANDON DELHI-110008 WZ-157/2, 3RDFLOOR(LEFT),RANJEETNAGAR,NEW SHIVAM GARG O -40BASEMENT,LAJPATNAGAR-II,NEWDELHI-110024 SHAILENDRA KUMARROY MIG 67,ANANTAVIHAR,POKHARIPUT,BHUBANESWAR-751020 SATYA PRADEEPROY H. NO.36/28,DLFPHASE-I,GURGAON-122002 SARITA YADAV D-30, 2NDFLOOR,WESTPATELNAGAR,NEWDELHI-110008 SANDEEP KUMAR BANASHANKARI 2NDSTAGE,BANGALORE-560070 NO:15 GROUNDFLOOR,2NDCROSSTECHERSCOLONY, SANDEEP KULKARNI VALACHERY, CHENNAI-600042 NO.1, FIRSTCROSSST,IVAVENUE(WEST),DHANDEESWARAM S VSRINIVASAN JAMSHEDPUR, RANCHI-834001 ROOM NO.309,VIKASHBHAWAN,AIADABUILDING,ADITYAPUR ROHIT PRAKASHPRIT CHARTERED SECRETARY of Training duringthemonth for Imparting List ofCompaniesRegistered October, I DECEMBER 2016 2016 BLOCK NO456,PALSANACHARRASTA,N.H.8,SURAT PRASHANT INDIALIMITED MNDC, MBP-P-136,MAHAPE,NEWMUMBAI-400710 MUMBAI MAJESCO LIMITED ANDHERI (WEST) B-411, CRYSTALPLAZA,OPPINFINITYMALL,NEWLINKROAD, ESAAR (INDIA)LIMITED 34 SANTTUKARAMROAD,CARNACBUNDER,MUMBAI C/O THETATAPOWERCOMPANYLIMITED,CORPORATECENTERB, WELSPUN RENEWABLESENERGYPRIVATELIMITED 3RD FLOOR,SGMPLAZA,8/226,ARYANAGAR,KANPUR VINAYAK SHREEREALESTATEPRIVATELIMITED DELHI GATERINGROADSURAT 03RD FLOOR,BELGIUMCHAMBERS,OPP.LINEARBUSSTOP, SOUTH GUJARATSHARESANDSHAREBROKERSLIMITED 19-C EXTENSION,GANDHINAGAR,JAMMU SANAATAN INFOTECHPRIVATELIMITED VADODARA SYNERGY HOUSE,GORWASUBHANPURAROAD,SUBHANPURA, RUBAMIN LIMITED (W), MUMBAI400064 3RD FOOR,4THDIMENSION,MINDSPACE,NEWLINKROAD,MALAD ROUTE MOBILELIMITED CYBERABAD, HYDERABAD NAC CAMPUS,IZZATNAGAR,KONDAPUR(POST), QUIPPO CONSTRUCTIONEQUIPMENTLIMITED 11/77, WESTPUNJABIBAGH,NEWDELHI-110026 OUR CO.INFRASTRUCTUREDEVELOPERSPRIVATELIMITED PHASE-1, PUNE PLOT NO.9,INDIALANDINDUSTRIALPARK,HINJEWADI, ORCHID INDIAMEDISOLUTIONSPRIVATELIMITED STN CHAMBERSIIFLOOR,VAZHUTHACAD,THIRUVANANTHAPURAM MPG HOTELSANDINFRASTRUCTUREVENTURES RAJKOT PLOT NO.G-1311METODAG.I.D.C.,GATE3,KALAWADROAD, ESTEEM AUTOPVT.LTD. 12TH FLOORDLFGALLERIACOMPLEXCITYPHASEIV,GURGAON EASTERN INDIAPOWERTECHLIMITED DIPLOMATIC ENCLAVE,50B,CHANAKYAPURI,NEWDELHI-110021 ROOM NO.341B,03RDFLOOR,MAINBUILDING,ASHOKAHOTEL, DMICDC LOGISTICSDATASERVICESLIMITED HIGHWAY,WARJE,PUNE SUBHAM HEIGHTS,NEXTTOIDBIBANK,MUMBAI-BANGALORE S.NO 114AND115/1/15,FLATNO45,2NDFLOOR, CAPTURESOLAR ENERGYLIMITED RO(79) 102, “ELTARA”,ORCHARDAVENUEHIRANANDANI,POWAI,MUMBAI- BOTHE WINDFARMDEVELOPMENTPRIVATELIMITED CONNAUGHT PLACE,NEWDELHI 39-42, INDRAPALACE.,H-BLOCK,3RDFLOOR,MIDDLECIRCLE, BHARUCH DAHEJRAILWAYCOMPANYLIMITED NEW DELHI-110015 23A 3RDFLOOR,SHIVAJIMARG,NAJAFGARHRAOD B.BRAUN MEDICAL(INDIA)PRIVATELIMITED 127

NEWS FROM THE INSTITUTE Company Secretaries Benevolent Fund MEMBERS ENROLLED REGIONWISE AS LIFE MEMBERS OF THE COMPANY SECRETARIES BENEVOLENT FUND* NEWS FROM THE INSTITUTE

S. LM NAME MEMB. CITY S. LM NAME MEMB. CITY NO. NO. NO. NO. NO. NO. EIRC 25 11522 MS. N SHARMILA ACS - 41318 CHENNAI 1 11504 MS. MINAKSHI BANTHIA ACS - 39673 KOLKATA 26 11528 MS. HEMALATHA KOREY ACS - 19148 HYDERABAD 2 11506 MR. VIVEK KUMAR SHARMA ACS - 38127 BILASPUR 27 11530 MR. RAGHAVENDAR REDDY M ACS - 36172 HYDERABAD 3 11513 MR. SAKET KUMAR ACS - 40686 KOLKATA 28 11535 MS. P JAGADEESWARI ACS - 46473 COIMBATORE 4 11527 MR. DHEERAJ TIWARI ACS - 47897 HYDERABAD 29 11536 SH. M SRINIVASAN ACS - 10980 CHENNAI 5 11550 MS. PRITI ARORA ACS - 31236 RANCHI 30 11537 SH. N SREEJITH ACS - 19810 THIRUVANANTHAPURAM NIRC 31 11538 SH. N NARAYANAN ACS - 9589 CHENNAI 6 11508 MR. JITIN WASAN ACS - 47624 NEW DELHI 32 11540 SH. PRADEEP KUMAR JAIN FCS - 8853 CHENNAI 7 11511 MR. ANAND ROCHLANI ACS - 32633 KANPUR 33 11541 MR. PAGATUR ASHOKKUMAR VISHNUKUMAR ACS - 44772 BELLARY 8 11515 SH. PRAVASH CHANDRA NAYAK FCS - 4541 NEW DELHI 34 11543 MR. NARASIMHARAJU OBALADEVARAHALLI ACS - 46150 BANGALORE 9 11521 MS. ANITA NAGAR ACS - 47740 GR. NOIDA RANGEGOWDA 35 11544 MR. SAMBAIAH ACS - 47567 BANGALORE 10 11523 MS. KALPANA SHARMA ACS - 27195 NEW DELHI 36 11546 MS. LAKSHMI KAKUMANI ACS - 16597 BANGALORE 11 11524 SH. SANJEEV GOEL ACS - 6079 NOIDA SANDHYA 12 11525 MR. VARUN VINOD KUMAR GUPTA ACS - 40969 AJMER 37 11547 MR. PAVAN KUMAR ACS - 44761 HYDERABAD 13 11526 MS. MEGHA BISHT ACS - 47797 GHAZIABAD KURUMADDALI 14 11531 MR. ARJUN SINGH PATWAL ACS - 43460 DELHI 38 11548 MR. VINAYAK NARASIMHA BHAT ACS - 38361 BANGALORE 15 11532 MR. SHANTANU BANSAL ACS - 38156 FIROZABAD WIRC 16 11542 MR. AMIT JOHRI ACS - 42767 JANAKPURI 39 11503 MR. HARSHIT KESHARWANI ACS - 37217 SAGAR 17 11549 MR. ANIL KUMAR FCS - 8023 CHANDIGARH 40 11512 MS. HINAL NARENDRA SHAH ACS - 41256 THANE 41 11514 MR. RAJENDRA SHRIRANG NIKAM ACS - 33025 MUMBAI SIRC 18 11502 MR. SATHASIVAM ASHOK KUMAR ACS - 36877 ERODE 42 11518 MS. RANI RAI ACS - 39581 SAGAR 19 11505 MS. SWETHA R ACS - 41291 CHENNAI 43 11519 MS. NAMRATA NISAR ACS - 29441 MUMBAI 20 11507 MR. MANKALA SHARATH ACS - 46146 HYDERABAD 44 11520 SH. PARESH MUKUNDRAY ACS - 20815 AHMEDABAD CHANDRA SHUKLA 21 11509 MS. R VIDYA LAXMI ACS - 39378 CHENNAI 45 11529 SH. PRASAD SHANKAR TILVE ACS - 21326 MUMBAI 22 11510 MR. JUSTIN PAUL ACS - 47422 KOCHI 46 11533 MR. ADITYA VIKRAMBHAI PATEL ACS - 41204 AHMEDABAD 23 11516 MR. KISHORE KATHRI ACS - 32947 HYDERABAD 47 11534 MR. DEVESH SURESHBHAI JOSHI ACS - 47961 JAMNAGAR 24 11517 SH. V SENTHIL KUMAR FCS - 3001 CHENNAI 48 11539 MS. DHRUTI JANAKKUMAR JARIWALA ACS - 40004 SURAT 49 11545 MR. RAJIVKUMAR NITINBHAI PANDYA ACS - 43620 AHMEDABAD * Enrolled DURING THE Period 20.10.2016 to 19.11.2016 50 11551 MR. NILESH SHARMA ACS - 43178 RAJNANDGAON

128 DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 129 128 DECEMBER 2016 I CHARTERED SECRETARY NORTHERN INDIA REGIONAL COUNCIL GUWAHATI CHAPTER BHUBANESWAR CHAPTER EASTERN INDIA REGIONAL COUNCIL on 05-06.11.2016 Excel”(Host: Agra Chapter)held - Empower,Emerge& Conference onthetheme“PCS Two DayPCSRegional Mark heldon02.11.2016 PCS HelpLineonIPR-Trade Programme Mandir, Kolkata. 26th November,2016atVidya on Saturday, Eastern Region ICSI 2016– Convocation at JWMarriott,Kolkata. Saturday, 5thNovember,2016 Company Secretarieson Conference of 27th Regional 31st October,2016. before NCLTon Appearances Half DayWorkshoponGST and Programme held on5.11.2016. Report and Vigilance Diligence Study CircleMeetingonDue on 2.10.2016. organized Full DayWorkshoponGST Futures heldon7.9.2016. with Commodity Hedging Study CircleMeeting/ PDP on Programme 15.11.2016 Swachh BharatMissionon Rourkela Programme on01.11.2016at Investor Awareness Programme CHARTERED SECRETARY I DECEMBER 2016 THE REGIONS QR Code/Weblink QR Code/Weblink QR Code/Weblink http://www.icsi.edu/Portals/70/ NEWS FROM http://www.icsi.edu/guwahati/ QR Code/Weblink baneswar/NewsEvents.aspx https://www.icsi.edu/bhu- https://www.icsi.edu/eiro/ NEWS%20FROM%20 NIRC29.11.2016.pdf NewsEvents.aspx Archive.aspx

ALLAHABAD CHAPTER ALLAHABAD SOUTHERN INDIA REGIONAL COUNCIL held on28.11.2016 PCS HelpLineonAnnualFiling held on23.11.2016 PCS HelpLineonAnnualFiling Forward heldon21.11.2016 - Impact&Way Demonetization Study SessiononCurrency held on20.11.2016 Secretaries by 130+Company Delhi Run-6km)-participation Half Marathon,2016(Great in theAirtelDelhi Participation 19.11.2016 Approaches &Methodheldon Workshop onValuation– held on16.11.2016 PCS HelpLineonAnnualFiling held on15.11.2016 Study SessiononAnnualFiling NIRC heldon12.11.2016 of Members withPastChairmen Council Meeting ofRegional held on12.11.2016 Reporting Corporate Fraud–Litigationand Seminar onthetheme 10.11.2016 held on getting CSMembership) participants (onthevergeof 250th batchofMSOP Campus Placement for245thto ICSI-SIRC House, Chennai. Balance” heldon14.10.2016at Management &WorkLife Study CircleMeetingon“Stress Chennai. 1.10.2016 atICSI-SIRCHouse, held on Remuneration” latest updatesonManagerial and Opportunities & Compliance Half Dayseminaron“GST: Programme and Rs.500 Currency NotesofRs.1000 of Indian Demonetization Programme heldon Programme QR Code/Weblink QR Code/Weblink http://www.icsi.edu/allahabad/ http://www.icsi.edu/guwahati/ webmodules/CS_Month_of_ https://www.icsi.edu/docs/ NewsEvents.aspx October_2016.pdf Home.aspx 129

NEWS FROM THE INSTITUTE & REGIONS NEWS FROM THE INSTITUTE & REGIONS BENGALURU CHAPTER 130 SIRC House,Chennai. 29.11.2016 (Tuesday)atICSI- on and CompetitionCompliance Programme onCompetitionLaw at ICSI-SIRCHouse,Chennai held on15.11.2016 Reporting” Provisions, Investigation& want toknowonFraud– Half DaySeminaron“Allyou House, Chennai. on 5.11.2016atICSI-SIRC Practical IssuesinXBRL”held Act updates in Companies& One DaySeminaron“Latest ICSI-SIRC House,Chennai 2016 heldon22.10.2016at Insolvency &BankruptcyCode, CS andAllyouwanttoknowon Analytics: ANewOpportunityfor Half-day seminaron“Business Ramada CochinResorts,Kochi. 14-15.10. 2016atHotel Company Secretarieson of Conference 41st Regional October 2016 Activity ReportfortheMonthof CS DayCelebrations members Study circlemeetingfor 2016 Campus RecruitmentDrive– Programmes forMembers Programme QR Code/Weblink Nov_05112016_and_15112016. https://www.icsi.edu/docs/web- https://www.icsi.edu/WebMod- modules/CS_Proceeding_for_ ules/Prg_Competitionlawand- http://bit.ly/2eYYPMD http://bit.ly/2eYY7iM ance_29112016.pdf http://bit.ly/2eElVgA CompetitionCompli- http://bit.ly/2fEiX8v http://bit.ly/2ffecBI pdf SALEM CHAPTER CHAPTER PALAKKAD MYSORE CHAPTER VADODARA CHAPTER PUNE CHAPTER WESTERN INDIA REGIONAL COUNCIL THIRUVANANTHAPURAM CHAPTER Programme November 2016 Services Taxheldon12th One DaySeminaronGoods& Programme Joint SeminaronGST Programme Proposed Secretarial Standards 25.11.2016 atVadodaraon Lecture Meeting held on Programme Pune. Workshops) heldon26.11.2016at Workshop amongaSeriesoffour Companies Act,2013-II”(Second Course onCriticalAspectsof Workshop on“KnowledgeRefresher Pune. Workshops) heldon25.11.2016at Workshop amongaSeriesoffour Companies Act,2013-II”(First Course onCriticalAspectsof Workshop on“KnowledgeRefresher Programme and CentralCouncilMembers.’ Kerala MinistersByICSIPresident meeting withStateGovernmentof On 23.11.206 “High level ministerial Laws” on Real-Estate Conclave On 02.11.2016 “Seminar-Legal Programme at Salemon5.11.2016 Full DaySeminaronGST held DECEMBER 2016 QR Code/Weblink QR Code/Weblink QR Code/Weblink QR Code/Weblink QR Code/Weblink QR Code/Weblink http://www.icsi.edu/salem/Activi- thapuram/ChapterActivities.aspx ChapterActivities/SeminarPDP. http://www.icsi.edu/Portals/37/ http://www.icsi.edu/thiruvanan- http://www.icsi.edu/portals/32/ I http://www.icsi.edu/palakkad/ CHARTERED SECRETARY http://www.icsi.edu/mysore/ ties/SeminarPDPs.aspx Write-up_25112016.pdf to_30_11_2016.pdf tary_21_11_2016_ Chartered_Secre- NewsEvents.aspx aspx CHARTERED SECRETARY I DECEMBER 2016 131 6 Miscellaneous Corner

n ETHICS & SUSTAINABILITY CORNER n GST Corner n readers’ write n EXPOSURE DRAFTS OF SECRETARIAL STANDARDS ON DIVIDEND AND REPORT OF THE BOARD OF DIRECTORS FOR PUBLIC COMMENTS n CG Corner n proceedings of 44th national convention of company secretaries

130 DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 131 Facing Challenges & Sustaining Growth Contributed by Brahma Kumaris, Om Shanti Retreat Centre, Gurugram resent time of uncertainty is posing new challenges for away from overcoming even the biggest of the challenges, P each one of us. These challenges may be at a by acquiring the appropriate skills or the coping ability. personal level, sometimes at the organizational level, or at Events are what one makes of them. How you look at societal level or even at global level, ranging on various challenge makes a lot of difference as it determines how you grounds like health, environmental, professional, economical, cope with it. After this understanding, of what a challenge is, behavioral, ethical etc. Under such strained circumstances it would be beneficial for us to know the silent message a when one doesn’t know why did that challenge arouse or challenges brings forth us. who is responsible for it, or for how long will it last- whether it will just go away and things will be alright or whether it is Challenges are indicative of progress going to last for quite long or maybe for your lifetime- the • When we are driving on a straight road- there are a level of stress rises high, fading the vision to move ahead, number of turns. But this number increases drastically diluting hope of success and discoloring the portrait of (with more of blind turns) when we are going up the happiness that was to be achieved through our now slope of a mountain. Higher the slope- more the seemingly futile efforts. When all options fail, the patience turns- higher is the acceleration needed. Similarly, and ethical strength of an individual often declines and they greater the target or learning, bigger is the challenge are tempted to adopt ‘quick fixes’ to mend up the situation awaiting us and stronger is the determination and by hook or by crook. Even though it seems that the challenge effort needed. And the best result is derived not from has subsided for a moment, but the individual enters into an large scale efforts, but from well focused and elevated endless loop of stress, fear, distrust, unethical behavior, efforts. which will ultimately accumulate for a later time, as a multi- fold times bigger challenge. Challenges indicate that there is a To deal with such a challenge and still sustain the ethical need to transform behavior, self respect, honor, inner strength, growth and Any challenge that comes our way brings along 2 choices success, let’s first understand the meaning of challenge for us. One of the choices is that you alter the difficulties from a new perspective, the very reason of its existence and in order to remove the challenge; which is not always ETHICS & SUSTAINABILITY CORNER & SUSTAINABILITY ETHICS ways to deal with it. possible or feasible as every challenge is not within the purview of modification or manipulation. Another choice is What is a Challenge? that you alter yourself to overcome the challenge. There • Any change that we are not used to- is a challenge. Like have been various cases in the history of mankind where for a small child riding a bicycle might be a challenge rulers were defeated, dynasties were doomed, kingdoms until he has learnt it. Once he knows how to ride a cycle, were lost, businesses perished and organizations became he can do it comfortably and riding that bicycle is no extinct due to complacency in the face of challenge and more a challenge for him. inefficiency to transform as per the challenge approaching • Any change is a challenge only till you have gained the them. There is a possibility that a challenge removed or inner strength or skills to face it and cope up with it. Like avoided or altered can come back to you and haunt you in the case of the child who has mastered the skill to later. But the challenge that you had overcome by ride a cycle, even the change of cycle will not be a up-skilling yourself, can never rise back to disturb you. challenge because cycle itself was never the challenge. Thus, challenge is an opportunity for us to transform. • No journey is without speed-breaker. Similarly, no life is without challenge. I can’t avoid a road with speed- breakers; what I need is a strong internal shock Challenges indicate the quality of absorbing suspension system in my car. Similarly, I our choice can’t avoid or escape challenges; I need a higher “If you always do what you have always done, you will amount of internal shock absorbing stability system. always get what you have always got” Just as our speed reduces upon encountering a speed Challenges born out of our past actions or decisions are breaker, our pace for achieving success reduces indicative of the quality of our choices as the challenge I momentarily when there comes a challenge. Through a am experiencing at this moment is the result of choices better or enhanced coping ability or skills, that act as and decisions made in the past. Thus, choice of action shock absorbing suspension system, we can overcome one has and that one executes while dealing with a the challenge and regain our speed… the journey situation is something in one’s control, while the challenge never halts… born out of it is out of the scope of control. Moreover, the Thus, challenges come our way and is a means to enhance challenge I may experience in the future depends on the our knowledge and increase our coping ability. Looking choices and decisions I make now. Thus, these challenges through this perspective, we realize that we are just one step are a means for self evaluation of our quality of choice.

132 DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 133 How to face challenges and ensure This is mainly because we feel that we are the only one who has to transform in the face of challenge or combat the sustainable growth? change. However, we fail to recognize that we are not alone Facing the Challenge || Acceptance over Resistance & as everyone in the system is going through the same Embracing over Fleeing – change or similar challenge. And even if the challenge we Acceptance of the change is the first step towards the are facing is exclusive, others too have their own challenge. change. Resisting a change or adopting an ostrich approach Being compassionate towards others and aware of the to ignore it doesn’t help. It has to be understood distinctly strengths and weaknesses of the self, we can develop a that unless we accept the problem, we cannot look for the mutual sense of cooperation with everyone in the system so right solution. that even the biggest of the challenge can be dealt by Fleeing from a situation could be like dose of pain-killer at bringing together the specialities of all; which further the time of challenge, not making us realize the pain and enhances the good will and team spirit in the system. plight of the situation but it cannot eliminate it. The situation has to be analyzed, examined, operated and conquered! This change of choice requires serious daring. Start this Facing the Challenge || daring from within and it will be easily extended to others. Understanding the Law of Karma But it is also to be appreciated that we all are at different Every cause has an effect. Sometimes the effect is pleasant levels of readiness for change. Being sensitive to the and sometimes it isn’t. Usually, a good effect or outcome is underlying feelings of others is the acceptance that they referred to as ‘luck’ and the undesired outcome is termed as seek and if there is resistance, it has to be understood. ‘challenge’. By observing the effect, we can estimate the quality of cause. Understanding this law of cause and effect (law of karma), Facing the Challenge || we are able to face challenges with strength knowing that it Self transformation doesn’t is somewhere linked to our decisions or actions of the past. This develops patience and tolerance to flow with the mean to lose away change and let the hard phase of life pass smoothly. “It is better to bend than to break” The awareness of this law also alerts us to sow fruitful seeds Whenever there arises a question of implementing a of elevated actions to prepare ground for desired outcomes. change, there is a hesitation to transform the self or adjust to the change. The main reason is that each one of us has ETHICS & SUSTAINABILITY CORNER & SUSTAINABILITY ETHICS a personal comfort zone and even the very thought of Facing the Challenge || Building Up coming out of it makes a person feel not only uncomfortable the Armour of Values but also susceptible to failure because adjustment to a To overcome any challenge, we need the ability to discern change is often considered as losing away one’s choice or the situation, take the right decision and while doing that, freedom or giving up one’s comfort. It has to be made very maintain our vale system. Discerning the purpose of the clear that through transformation of the self, there could be situation or challenge and the purpose of my being is the something to gain from the impending change. first step of finding the solution. Next is to create a vision and Self transformation doesn’t necessarily mean to completely bring our values into action to overcome the hurdles. The do away with the roots of the self. It means to fill up the gaps ability to bring your vision and values into actions rests on in one’s personality and skills- which may require breaking our mental powers. As the external environment becomes the orthodox or rudimentary belief systems and delegation of more unpredictable, awareness of our inner powers present responsibilities by realizing that the old ways aren’t becomes more important. going to work any longer, giving way for new and better things to take its place. But when instead of this, we tend to Rajyoga Meditation is the technique to connect with the leave our roots and try to superficially polish the self to avoid self, which is a reservoir of virtues that we seek to establish a challenge; it degrades the self by creating craters and outside. We expect the virtues to be implemented and scars on our personality. practiced for sustainable growth, but seldom realize that Moreover, when we take the pressure off, we often tend just as whatever we see in the mirror is our reflection; revert to our old behaviour. Thus, we need to understand the similarly, whatever happens with us is a reflection of benefit of the transformation, create a vision and an action whatever has been done through us. It gives us the plan to follow and therefore completely rule out the possibility opportunity to explore ourselves to find out what is it that I of the challenge boomeranging in future. stand for and what are those strengths that I posses through which I can overcome the challenge. It enhances Facing the Challenge || our salient qualities like introspection, flexibility, creativity, self confidence, determination, truthfulness, cooperation Sense of cooperation and many more. Thus, Rajyoga Meditation helps us to first “As such I may be a drop, but together we are an ocean !” go within to touch base with the virtuous self, enhance our “Why always Me?!” “When will it end?” These are a few inner powers, build up the armour of values to prepare thoughts that pop up in our mind when we face a challenge. ourselves to face the challenges.

132 DECEMBER 2016 I CHARTERED SECRETARY CHARTERED SECRETARY I DECEMBER 2016 133 GST CORNER GST Updates and services, exemptions under indirect tax regime • The fourth GST Council meeting which was held on chaired by Revenue Secretary, to finalise draft GST Laws November 3, 2016, concluded with the following : • Government plans to introduce all three GST-related Bills n The four slabs of tax rates have been fixed at 5 as money bills percent, 12 percent, 18 percent and 28 percent • 48 firms including Kotak, TCS to become service providers n Higher tax between 40 percent and 65 percent may be for GST Network imposed on luxury goods like luxury cars, pan masala, • Few key highlights of Revised Draft Model GST Law :

GST C orner aerated drinks and tobacco products n “Securities” will not attract any tax under GST Law n Most white goods, like washing machines, air n Supplies made to SEZ units will be treated as ‘zero- conditioners, refrigerators, shampoo, shaving stuff rated supplies’ under the revised GST law and soap, will be taxed at 28 percent n Perquisites enjoyed by employees will not attract n Food grains to be zero-rated to insulate people from GST, irrespective of whether they are used for inflationary pressures business purposes or personal consumption n A cess, in order to raise funds to compensate states n New place of supply provisions for services, almost for the revenue loss to be levied similar to the Place of Provision of Service (POPS) n No consensus yet on tax rate for gold rules present under the current service tax law, n The matter of jurisdiction of assessee under GST introduced regime remains unresolved n An anti-profiteering clause has been introduced in the revised GST law which casts the responsibility of • The debate of jurisdiction administration of assessees every company to pass on the benefit of GST to its has now narrowed down to two options: end consumers n To divide the tax base horizontally, so that taxpayers n Highest tax slab will not exceed 28% in the GST below a threshold of Rs 1.5 crore are administered by regime the states and those above this threshold are equally n The revised draft GST Bills outlines mixed and divided between the centre and the states composite goods, which was not there in the earlier n To divide the entire tax-base vertically, wherein draft taxpayers are divided between the centre and states n E- Commerce Players Amazon, Flipkart Need To in a fixed proportion—a solution favored by the Centre Register in each State Under GST and would have to deduct one per cent tax at source each for Centre and • GSTN to borrow Rs. 250 crore for working capital needs State tax and another Rs. 550 crore as long-term loan from domestic lenders GST in News • Government to include the rates of the tax and the cess • GST Network to borrow Rs 800cr from banks to fund GST under GST in the model legislations, which may be infra building cost introduced in ongoing Winter Session of Parliament • ASSOCHAM urges against cess, suggests GST rate hike • There would be a provision to allow the GST Council to by 1-2% notify changes in the rate structure to give more flexibility • IRS Officers demand GST assessments by Centre to change rates in case of a crisis. • Ahead of Council meet, States yet to come up with • GST Portal - www.gst.gov.in is readying the IT backbone options for cess on GST for the new regime. For service tax, migration will be open • Goa Government to convene special session on GST from January 1, 2017 to 31st January,2017 • GST Council’s decision to impose five per cent tax on • Gujarat Government began migrating commercial tax essential items would bring down inflation : Finance payers from existing tax platform such as value added tax Minister (VAT) to the new goods and service tax (GST) platform • GST Rates on consumer durables should be 18%: • The Centre had shared the draft model GST law with the CEAMA states, which were redrafted after taking into account the • GST Portal goes live, GSTN Software almost ready : comments of stakeholders GSTN Chairman • The Centre had circulated draft GST Bills and draft • GST Implementation can’t be delayed beyond September compensation Bill with the states but it does not contain 16, 2017: Finance Minister the four-slab rates agreed to by the GST Council • Parliament Winter Session Agenda: From GST to • Both Central and State Government tax officers discussed Corruption, Government looks to get key bills cleared aspects of Draft GST Laws, tax rates on various goods • No consensus on draft laws as GST Council meet

134 DECEMBER 2016 I CHARTERED SECRETARY postponed to December 2-3 Show Cause Notice for Cancellation of • GST to spur double digit growth in hiring across sectors 15. REG-15 Registration • Demonetization may delay GST

Registration under GST 16. REG-16 Order for Cancellation of Registration

List of forms specified under registration rules: Application for Revocation of Cancelled

17. REG-17 GST C orner Registration under GST Act, 20-- S. Form Description No. No. Order for Approval of Application for Revocation 18. REG-18 of Cancelled Registration Application for Registration u/s 19(1) GST Act,20- 1. REG-01 - Notice for Seeking Clarification / Documents 19. REG-19 relating to Application for Revocation of Cancellation 2. REG-02 Acknowledgement 20. REG-20 Application for Enrolment of Existing Taxpayer Notice for Seeking Additional Information/ 3. REG-03 Clarification/Documents relating to Application for Provisional Registration Certificate to existing Registration / Amendments / Cancellation 21. REG-21 taxpayer Application for filing clarification/additional information/document for Registration / 4. REG-04 Amendment / Cancellation / Revocation of 22. REG-22 Order of cancellation of provisional certificate Cancellation Order of Rejection of Application for Registration Intimation of discrepancies in Application for 5. REG-05 / Amendment / Cancellation / Revocation of 23. REG-23 Enrolment of existing taxpayer Cancellation Application for Cancellation of Registration for the Registration Certificate issued u/s 19(8A) of the 6. REG-06 24. REG-24 Migrated Taxpayers not liable for registration GST Act, 20-- under GST Act, 20-- Application for Registration as Tax Deductor or Application for extension of registration period by 7. REG-07 Tax Collector at Source u/s 19(1) of the GST Act, 25. REG-25 Casual / Non-Resident taxable person. 20-- Order of Cancellation of Application for 8. REG-08 Registration as Tax Deductor or Tax Collector at 26. REG-26 Form for Field Visit Report Source u/s 21 of the GST Act,20-- Application for Allotment of Unique ID to UN 9. REG-09 Bodies/ Embassies /any other person u/s 19(6) of the GST Act, 20--

Application for Registration for Non Resident 10. REG-10 Taxable Person Congratulations

Application for Amendment in Particulars s. NIRJA SARAF, FCS, 11. REG-11 subsequent to Registration “M working as Company Secretary & Executive Director 12. REG-12 Order of Amendment of existing Registration (CA, HR & Legal) of Braithwaite and Co. Ltd., Kolkata on her being

Order of Allotment of Temporary Registration/ appointed as the Managing Director 13. REG-13 Suo Moto Registration of Hindustan Antibiotics Ltd. (A Govt. of India Enterprises), Pune, w.e.f. 01- Application for Cancellation of Registration under 10-2016.” 14. REG-14 GST Act ,20--

CHARTERED SECRETARY I DECEMBER 2016 135 Ambiguities in section 186

resently the Inter corporate loans & Investment is regulated by section 186 of the Companies Act, 2013 (“The Act”) which is corresponding to section 372A of erstwhile Companies Act, 1956. Though the intention of both sections are identical, additional P restrictions under the 2013 Act results in the provisions under Section 186 becoming more rigorous. Section 186 prohibits investment through more than 2 layers of investment companies. However this restriction is not applicable for investment in company incorporated outside India which has investment subsidiaries beyond two layers as per laws of that country. This restriction also does not cover existing companies having multiple layers in India prior to April 1, 2014. This restriction is brought in to prevent draining off of funds through investment subsidiary companies. “Layer” in relation to a holding company means its subsidiary or subsidiaries (section 2(87)). Transaction under section 186 can be entered by the board only if the aggregate of all such existing and proposed transactions does not exceed the following limit:

R eaders ’ W rite a) 60% of its paid up share capital, free reserve and securities premium account; or b) 100% of its free reserves and securities premium account. Prior approval of shareholders by way of special resolution is required in case the above limit is exceeded. However as per rule 11 of Companies (Meetings of Board and its powers) Rules, 2014 when a loan or guarantee is given or where a security has been provided by a Company to its wholly owned subsidiary Company or a Joint Venture Company, or acquisition of securities of wholly owned subsidiary company is made by a Holding Company, requirement of taking shareholders approval is not required. One more restriction that is striking compared to the provisions of section 372A of the 1956 Act is that while a loan could have been given even at nil interest under the 1956 Act, Section 372A prescribes a minimum of a rate equivalent to the government security rate. Therefore, even Holding Company can’t give loan to its Wholly owned Subsidiary at a rate less than prevailing rate of interest linked to Government securities as per Section186(7). Unlike Section 372A of Companies Act, 1956, Section 186 is applicable without prejudice to other provisions in the Companies Act, 2013, and Sections 185 states that ‘Save as otherwise provided in this Act’. If Section 186 states differently from 185 then 186 could prevail. However, if there is no conflict both Section 185 and 186 have to be complied with. Therefore Section 185 needs to be read and complied independently. This has resulted in the inability of the Company to fund its own group companies as section 185 bars a holding company to give loan to its own subsidiary (except to its 100% owned subsidiaries and in the ordinary course of business at bank interest rate). The rationale for this restrictions needs to be questioned more so when the 1956 Act did not have any such restriction and had a specific exemption for such loans to any subsidiary under Section 295(2)(b). Now the only way by which a holding company can help in funding of its non wholly owned subsidiary is by letting it borrow from a third party including banks and the holding company to provide guarantee for repayment of such loans/ bank loans taken by its subsidiary. If companies are not allowed to lend to its own subsidiaries where will they go for funds? Is it helping the ability of companies to do business normally? Forget about ease in doing such businesses, the mantra of the present Govt to attract foreign investments. Though exemption is given to private companies, provided they fulfil the prescribed condition, it is not helping the large section of the companies. Therefore Section 185 needs an amendment to bring back the exemption to all subsidiaries as contained. Another haziness is in interpreting the meaning of ‘in ordinary course of business’. As per Section 185(1)(b), section 185(1) is not applicable to loan advanced or guarantee given or security provided by a company in the ordinary course of its business at rate not less than bank rate declared by the Reserve Bank of India. Therefore it is clear that a holding company can advance loan or give guarantee or provide security in the ordinary course of business. Problem here is MCA has not clarified the meaning of ‘ordinary course of business’, is it the business mentioned in the MoA or even practice, custom can also be considered as ordinary course of business. Example: Company B is a non wholly owned subsidiary of company A. B has no revenue and since its incorporation it depends wholly on the financial assistance given by com A for doing business. So is this considered as ordinary course of business? Auditors (CAs) are by and large applying the following principles (one or more of these principles) for testing Ordinary course of business both under section 188 and under Section 185/ 186- • Transaction forms part of the regular activity of the company • Transaction forms part of the Main Objects / Incidental / Ancillary Objects of the Memorandum of Association • Transaction forms part of the Other Objects of the MoA , subject to shareholder’s approval • Transactions are necessary for continuation of business uninterruptedly • Transactions are frequent / regular is nature • Transaction forms part of the revenue from operations (not from other income) • Transaction forms part of cost of goods sold or operating expenses • Transaction forms part of capital asset like fixed assets, Plant and machinery, real estate etc • Transaction forms part of current assets or loans and advances where by the income earned is reflected in revenue from operation • Transaction forms part of liabilities where by the expenses are reflected in cost of goods sold or operating expenses • Materiality of the transaction. “Loan” as per section 186 Section 372A of Companies act, 1956 was explaining the term loan as; “Loan” includes debentures or any deposit of money made

136 DECEMBER 2016 I CHARTERED SECRETARY by one company with another company, not being banking company. Therefore it was clear that Deposit with Bank (in various accounts like current account, deposit accounts etc) was exempted while calculating the limits under section 372A of Companies Act, 1956, however same is not exempted under Companies Act, 2013 which creates an additional restriction forcing one to include deposit made with the banks for the purpose of calculating the limit under section 186 of Companies Act, 2013. Another question which follows is, if Deposit with banks are not excluded for calculating the limit under section 186, whether Bank Deposit made under Companies Act 1956 should be exempt since such deposits were made prior to the commencement of Section 186? Or they should also be considered while calculating the limit under Section 186? This makes the calculation complicated since both existing loans as on March 31, 2014 and loans provided from April 1, 2014 including bank deposits have to be considered while calculating the limits. Penalty for Contravention Violation of this section is not Compoundable under section 441 read with Section 186 of the Act as it involves fines on the company and its officers and Imprisonment to officers. The confusion gets further confounded since Section 441 is not yet notified and it takes one back to Section 621A of the Companies Act, 1956.

Penalty for Company: R eaders ’ W rite Every Company which contravenes the provisions of this Section shall be liable to a penalty which shall not be less than Rs. 25,000/- but which may extend to Rs. 5 lacs. Penalty for Officers: Every officer of the Company who is default shall be punishable with imprisonment for a term which may extend to two years and fine which shall not be less than Rs. 25,000/- but which may extend to Rs. 1 lacs. Conclusion: The ambiguities under this section needs to be clarified and to be interpreted carefully as violation of this section is not compoundable and may put the directorship of directors at stake, if it results in fine under the Act, it may result in vacation of their office as per section 167 of the Act and in case of Whole time Directors, as per Part I to Schedule V of Companies Act, 2013 they become ineligible to be appointed as such in any company. A cursory analysis shows many Companies in the sensex and Nifty have crossed the limits and it remains to be seen how the company’s and regulatory authorities interpret these provisions in letter and spirit for a meaningful conclusion.

Quick analysis on few Company’s Loans and Investment along with the applicable limits Below table is presented allowing the readers to interpret the tabulated details as it appears, based on a preliminary finding, that many of the Companies in India do not appear to be including the amount deposited with bank while calculating the Limits for Section 186 of the Companies Act, 2013. It is not clear from the Annual reports of these companies if approval of shareholders has been taken for exceeding these limits. Limit under section 186 Amount of Loan and Investment Amount of Total Loans and 60% of its paid up 100% of its free Sl.No Company Name Including Bank Deposit Investment (Rs. In share capital, free reserves and Guarantee (Rs. In (Rs. In Crs) Crs) reserve and securities premium Crs) securities premium account account

1 Bajaj Auto Limited 3746.78 370.2 4116.98 6415.29 10402.78 2 Dr. Reddy’s Laboratories Limited 746.3 895.5 1641.8 6319.8 10447.8 3 Tata Motors Limited 1410.79 31692.29 33103.08 8276.094 13149.71 4 Jet Airways (India) Limited 4758.18 2067.35 6825.53 2179.12 3442.53 5 Asian Paints Limited 162.07 22.58 184.65 2537.856 4133.84 Mangalore Refinery and 6 Petrochemicals Limited 1753.63 7169.06 8922.69 3177.468 3543.11 7 Hindustan Unilever Limited 2095.49 2444.52 4540.01 2197.158 3445.58 8 Infosys Limited 3833 27722 31555 28807.2 47438 9 Mahindra & Mahindra Limited 1543.4 7778.97 9322.37 11433.654 18760.39

Disclaimer: Details presented in the table above are taken from the Annual Report of the respective Companies during 2014-15. Though honest effort is made in collecting the figures, this requires further analysis. The above loan excludes loans to wholly owned subsidiaries and it may include bank deposits made prior to April 1, 2014 which were exempted under the 1956 Act. Banking Companies, Insurance companies, and housing finance companies are not considered in samples due to exemption available to them both under the Companies Act, 1956 and Companies Act, 2013.

Sowrabh S Rao, ACS, Company Secretary, Jupiter Capital Pvt. Ltd., Bengaluru.

CHARTERED SECRETARY I DECEMBER 2016 137 EXPOSURE DRAFTS OF SECRETARIAL STANDARDS ON DIVIDEND AND REPORT OF THE BOARD OF DIRECTORS FOR PUBLIC COMMENTS (Last Date for comments: December 25, 2016)

he Secretarial Standards Board (SSB) of the Institute 6. Conflict with Judicial Pronouncements of Company Secretaries of India (ICSI) has revised Under this, you may point out if any part of the Standard differs T its Secretarial Standard on Dividend and Secretarial from or contradicts or is conflicting with any judgement of either Standard on Report of the Board of Directors as per the the Supreme Court or High Court or any clarification by a Companies Act, 2013, Rules made thereunder and other regulatory authority like MCA, SEBI, Stock Exchange, etc. applicable regulations, and hosted the Exposure Drafts thereon for public comments on ICSI website (www.icsi.edu). 7. Best Secretarial/Industry Practices Based on public comments, these two Standards would be Under this, you can share the good practices being followed finalised. by your organisation or industry, in respect of any of the areas While sincere efforts have been made by SSB to address which the Standard seeks to cover, which removes the barriers multiple grey areas in the law and incorporate best practices that might have been hindering industry from complying with being followed by the corporates in the country; simultaneously any of the provisions of the Act or Rules and/or facilitates better facilitating the professionals and benefitting the industry, your corporate governance. comments, views and suggestions on the same is vital in order to bring out effective and acceptable Standards. 8. Typical Situations/Scenarios not addressed in the In the light of the above, your specific comments or suggestions Standard are solicited on the Exposure Drafts of: Under this, you can list any critical issues or special 1. Secretarial Standard on Dividend and circumstances encountered by you, which you consider are not 2. Secretarial Standard on Report of the Board of Directors addressed in the Standard and which could be added.

Comments/suggestions should be sent under the following 9. Any other Suggestions not covered above heads for better analysis: If you have any other suggestions or if you feel that the standard is not accurate or complete, you may respond under 1. Drafting Improvements this. Otherwise, please confine your suggestions under the Under this, we are concerned with deviations from the standard points enumerated above. use of English as understood by a company. If you feel that the communication at any place is not effective or the Standard Please arrange to send your suggestion in the following is not clear and concise, and can be improved further, kindly format specifying the above categories: suggest the manner in which it should be expressed. Suggestions on Exposure Drafts of Secretarial Standards (SS) 2. Areas not covered in law, suggested to be covered in on Dividend / Report of the Board of Directors the Standard Sl. Para No. / Existing Text Suggestions Rationale for Under this, we are concerned with the situations where neither No. Page No. of SS the Suggestion the Act nor the Rules make provisions to cover a given situation or the Rules have not provided to make an exception where it is otherwise warranted. The texts of the Exposure Drafts are placed on pages 139 onwards. 3. Contradictions with the Act or Rules The last date for giving comments is Sunday, December 25, Under this, you may point out any aspect of the Standard which 2016. Please do not wait for the last date to give your comments. is not consistent with or contradicts any of the provisions of the Companies Act, 2013 or Rules made thereunder. Your comments in the above format may be sent through e-mail at [email protected] with a copy to [email protected] or 4. Contradictions with any other law may also be sent in hard copy to the following address: Under this, you may point out any aspect of the Standard which is not consistent with or contradicts any of the provisions of any Institute of Company Secretaries of India other Act, Rules or Regulations. (Secretariat-SSB) ICSI House, 22, 5. Multiple or diverse interpretations of any part of the Institutional Area, Lodhi Road, Standard New Delhi – 110003 The attempt of the Standard is to have only one interpretation 011-45341055 i.e. the endeavour is to make the Standard unambiguous. Kindly point out in this section, if you find any part of the Chairman standard which is capable of multiple or diverse interpretations Issue Date: November 28, 2016 Secretarial Standards Board or ambiguity.

138 DECEMBER 2016 I CHARTERED SECRETARY Exposure Draft SECRETARIAL STANDARD ON DIVIDEND he following is the text of the Secretarial Standard-3 “Final Dividend” means the Dividend recommended by (SS-3) on “Dividend”, issued by the Council of the the Board of Directors and declared by the Members at an T Institute of Company Secretaries of India. Annual General Meeting. Adherence to this Secretarial Standard is recommendatory “Interim Dividend” means the Dividend declared by the Board for all companies to facilitate uniform practices in distribution of Directors at its meeting. of profits by way of “Dividend”. “Free Reserves” means such reserves which, as per the (In this Secretarial Standard, the Standard portions have latest audited balance sheet of a company, are available for been set in bold type. These shall be read in the context distribution as Dividend. However, the following amount shall of the background material which has been set in normal not be treated as free reserves: type. Both the Standard portions and the background (i) any amount representing unrealised gains, notional material have equal authority). gains or revaluation of assets, whether shown as reserve or otherwise, or INTRODUCTION (ii) any change in carrying amount of an asset or of a liability Dividend is a return on the investment made in the share recognised in equity, including surplus in profit and loss account capital of a company, as distinct from the return on borrowed on measurement of the asset or the liability at fair value. capital, which is in the form of interest. “Interim Financial Statements” means the financial statements In commercial usage, the term “Dividend” refers to the share of prepared for an interim period shorter than a full financial profits of a company that is distributed amongst its Members. year, comprising of following: The term “Dividend” has been inclusively defined in the (a) a balance sheet; Act to the effect that it includes Interim Dividend. The Act (b) a statement of profit and loss; neither specifically defines the term Dividend nor makes any (c) a statement of Cash flow statement; distinction between Interim and Final Dividend. (d) a statement of changes in equity; and For the purposes of this Standard, capitalization of profits in (d) explanatory notes thereon. the form of bonus shares is not Dividend. “Member”, in relation to a company, means— A company licensed under Section 8 of the Companies Act, (i) the subscriber to the memorandum of the company who 2013 or corresponding provisions of any previous enactment shall be deemed to have agreed to become member of thereof are prohibited by their constitution from paying any the company, and on its registration, shall be entered as dividend to its members. member in its register of members (ii) every other person who agrees in writing to become a SCOPE member of the company and whose name is entered in This Standard prescribes a set of principles in relation to the the register of members of the company; declaration and payment of Dividend and matters related (iii) every person holding shares of the company and whose thereto. name is entered as a beneficial owner in the records of a The principles enunciated in this Standard are in conformity depository; with the provisions of the Act. In addition, the provisions “Preference Shareholder” means a holder of such shares of the Securities Contracts (Regulation) Act, 1956 and the as carry a preferential right, in respect of Dividend, to a fixed SEBI (Listing Obligations and Disclosure Requirements) amount or an amount calculated at a fixed rate and, in respect Regulations, 2015 are applicable to listed companies. Any of capital, to repayment of capital. specific provision relating to Dividend in the Income-tax Act, “Shareholder” means a Member as defined above and, 1961or under any other statute shall also be applicable. where the context requires or admits, includes a Preference The principles set out herein relate to declaration and Shareholder. payment of dividend on equity as well as preference share Words and expressions used and not defined herein shall have capital in accordance with the provisions of the Act and are the meaning respectively assigned to them under the Act. in respect of Dividend as it relates to a going concern. These are equally applicable to final as well as interim dividend SECRETARIAL STANDARDS unless otherwise stated. 1. Ascertainment of amount available This standard shall not apply to a company limited by for payment/distribution as Dividend. guarantee not having share capital and does not deal with 1.1 Out of profits Dividend, if any declared by companies under liquidation. 1.1.1 Dividend shall be paid out of the profits of the financial year for which such dividend is sought to DEFINITIONS be declared and/or out of profits for any previous The following terms are used in this Standard with the financial year(s) which remains undistributed after meaning specified: providing for depreciation in accordance with the “Act” means the Companies Act, 2013 (Act No. 18 of 2013) or provisions of the Act. Dividend may also be declared any previous enactment thereof, or any statutory modification out of money provided by the Central Government or thereto or re-enactment thereof and includes any Rules and the State Government in pursuance of a guarantee Regulations framed thereunder. given by such Government for this purpose. “Dividend” means a distribution of any sums to Members out Dividend shall not be declared unless carried over of profits or free reserves available for the purpose. previous losses and depreciation not provided in the

CHARTERED SECRETARY I DECEMBER 2016 139 previous year(s) are set off against the profit of the current financial year, the Board shall consider the company for the current year. The company may, before Interim Financial Statements for the period for which declaration of Dividend, transfer such percentage of Interim Dividend is to be declared and should be profits, as it may consider appropriate, to its reserves. satisfied that the financial position of the company Dividend, being a portion of the profits of the company, justify and support the declaration of such Dividend. is distributable amongst the Members of the company The Interim Financial Statements so prepared shall in accordance with the provisions of the Act. The Act take into account depreciation for the full year, tax requires a company to prepare a statement of profit on profits of the company including deferred tax and and loss, which should give a true and fair view of other anticipated losses for the financial year. The the profit or loss of the company for a financial year. Interim Financial Statements shall also take into The terms ‘profit’ and ‘true and fair’ have not been account the Dividend that would be required to be defined by the Act, therefore, these terms should be paid at the fixed rate on preference shares. understood in their natural and proper sense. The The Interim Financial Statements shall also take into statement of profit and loss shall be prepared in account the losses incurred, if any, during the current accordance with the generally accepted accounting financial year upto the end of the quarter, immediately principles and presented in conformity with the preceding the date of declaration of Interim Dividend. requirements set out in the Act. Further, in such a case Interim dividend shall not be The depreciation shall be provided in the books of declared at a rate higher than average dividend declared account of the company as computed in accordance during the immediately preceding three financial years. with Schedule II to the Act, which prescribes useful lives 1.1.5 Where a company has issued equity shares with of various assets for the purpose of such computation. differential rights as to Dividend, Interim Dividend The useful life of an asset shall not ordinarily be may, at the option of the Board, be declared on all different from that prescribed under the Act. However or any one or more of the classes of such shares where a company adopts useful life different from in accordance with the terms of issue. that prescribed under the Act, or uses residual In case Interim Dividend is declared on only one value of more than five percent of original cost, the class of equity shares, the Board shall ensure that financial statement of the company shall disclose the profit as shown in the interim financial statements such difference with justification for the variance duly is adequate to meet the Dividend that would have supported by technical advice. to be paid on the other classes of equity shares in 1.1.2 A company shall not declare Dividend on its accordance with the terms of issue. equity shares in case of non-compliance of Where a company has issued equity shares with provisions relating to the acceptance of deposits differential rights as to voting only, no differentiation under the Act, till such time the deposits accepted shall be made in the declaration of Interim Dividend have been repaid with interest in accordance on such shares. with the terms and conditions of the agreement 1.2 Out of Free Reserves entered with the depositors. 1.2.1 In a year in which the profits are inadequate or A company shall also not declare any Dividend, if – there are no profits, the company may declare (a) it has defaulted in redemption of debentures Dividend out of Free Reserves subject to the or payment of interest thereon or creation of fulfilment of the following conditions: debenture redemption reserve, (a) The rate of Dividend declared by the company (b) it has defaulted in redemption of preference shall not exceed the average of the rates at which shares or creation of capital redemption reserve, Dividend was declared by it in the three financial (c) it has defaulted in payment of dividend declared years immediately preceding the financial year in the current or previous financial year(s), or of declaration of Dividend. This shall not be (d) it has defaulted in repayment of any term loan to applicable where a company has not declared a bank or financial institution or interest thereon, any Dividend in each of the three preceding till such time the default is subsisting. financial years. No dividend shall be declared by the company during (b) Total withdrawal from the accumulated profits the extended time, if any, granted by the Tribunal/ shall not exceed one tenth of the paid up share Court for repayment of above liabilities, since the capital and free reserves of the company as per default is still subsisting during such period. the latest audited financial statements. 1.1.3 Dividend shall not be declared out of the (c) The amount so withdrawn shall first be utilised Securities Premium Account or the Capital to set off the losses, if any, incurred in the Redemption Reserve or Revaluation Reserve or financial year in which Dividend is proposed to Amalgamation Reserve or out of profits on re- be declared. issue of forfeited shares or out of profits earned (d) The balance of Free Reserves after such prior to incorporation of the company. withdrawal shall not fall below 15% of the paid 1.1.4 Interim Dividend shall be declared and paid only up share capital of the company as per the latest out of the surplus in the profit & loss account and/ audited financial statements. or out of the profit for the financial year in which 1.2.2 Interim Dividend shall not be declared out of Reserves. such Dividend is sought to be declared. In the event of a loss or inadequacy of profits, no The Board of Directors of a company may declare Interim Dividend shall be paid out of Free Reserves. interim dividend during any financial year. While However, Final Dividend may be paid out of Free declaring the Interim Dividend out of profits of the Reserves.

140 DECEMBER 2016 I CHARTERED SECRETARY 2. Declaration of Dividend in electronic form, to those Members whose names 2.1 Dividend shall be declared only on the appear as beneficial owners in the statement of recommendation of the Board, made at a meeting beneficial ownership furnished by the Depository(ies) of the Board. as on the record date fixed by the company for this The recommendation for declaration of Dividend shall purpose; (ii) in respect of shares held in physical neither be made by a Committee of the Board nor by form, to those Members whose names appear in the way of a Resolution passed by circulation. company’s Register of Members after giving effect to Unless the Dividend has been recommended by the all valid share transfers in physical form lodged with Board, Members in Annual General Meeting cannot the company before the date of book closure or as on on their own declare any Dividend. the record date, as the case may be and (iii) in respect Where a company has an Audit Committee, this of share warrants, to the holders of such warrants. Committee shall consider the annual financial The dividend may also be paid to the order of the statements before submission to the Board. Dividend member or to his banker. shall be recommended by the Board after consideration 3.2 Preference Shareholders shall be paid Dividend and approval of said financial statements. All requisite before Dividend is paid to the equity Shareholders approvals shall be obtained before declaration of of the company. Dividend. Dividend shall not be declared subject to any Preference shares carry a preferential right as to Dividend condition such as the approval of financial institutions/ in accordance with the terms of issue. However, this right banks or foreign collaborators or compliance with any is subject to the availability of distributable profits. Since other contractual obligation. the dividend on preference shares is governed by the 2.2 Dividend shall be declared only at an Annual terms of issue already approved by the shareholders, General Meeting. the Board may declare Dividend on such shares in Dividend shall relate to a financial year and shall be accordance with the terms of issue. declared by the Members at the Annual General Meeting If there are two or more classes of preference shares, of the company after consideration of the financial the holders of the class which has priority are entitled statements of the company. Members may declare a to their preference Dividend before any Dividend is lower rate of Dividend than the rate recommended by paid in respect of the other class, if the terms of issue the Board but have no power to increase the amount or so provide. However, if the terms of issue are silent, rate of Dividend recommended by the Board. Dividend shall be distributed on pro-rata basis. The members may also decide not to declare the In the case of Interim Dividend, while Preference dividend recommended by the Board. The dividend, if Shareholders need not necessarily be paid Dividend declared, should be disclosed on per share basis. before Interim Dividend is paid to equity shareholders, 2.3 No Dividend shall be declared on equity shares the Board should set aside such sum as would for previous years in respect of which annual be necessary to pay Dividend to the Preference financial statements have already been adopted Shareholders before consideration of Interim Dividend. at the respective Annual General Meetings. 3.3 Arrears of Dividend on cumulative preference Arrears of Dividend on cumulative preference shares for shares shall be paid before payment of any previous years may, however, be declared and paid. Dividend on equity shares. 2.4 Interim Dividend shall be declared at a meeting of Preference shares may be cumulative or non-cumulative. the Board. Dividend in arrears on cumulative preference shares can Declaration of Interim Dividend shall neither be be paid in a later year where there are profits to justify made by a Committee of the Board nor by way of a such payment. In the case of non-cumulative preference Resolution passed by Circulation. shares, if no Dividend can be paid in a year, there is no While Final Dividend is recommended by the Board right to receive the same in future years. and declared by the Members, approval of Members After paying the Dividend on preference shares and any is not required for declaration of Interim Dividend. arrears of Dividend on cumulative preference shares, However, as a measure of good practice, payment residual profit may be utilised for payment of Dividend of Interim Dividend should be recorded at the Annual to equity Shareholders. However, where participating General Meeting. preference shares have been issued, the holders thereof Where a company has an Audit Committee, this also have the right to participate in such residual profit, Committee shall consider the interim financial statements subject to the terms of issue of such shares. which shall thereafter be submitted to the Board for its 3.4 Dividend on equity shares shall be paid in consideration and declaration of Interim Dividend. accordance with the rights of the respective 2.5 Distribution of discount coupons to all the classes, if any, of such shares. shareholders shall not be treated as deemed Where a company issues equity shares with dividend. differential rights as to Dividend, the terms of issue of 2.6 A company is prohibited to issue Bonus shares in such shares shall govern the rights of each such class lieu of dividend. of holders as to receipt of Dividend. 3. Entitlement to Dividend 4. Dividend in Abeyance 3.1 Dividend to be paid only to the registered holders 4.1 The amount of Dividend in respect of shares of shares entitled to Dividend or to their order or for which an instrument of transfer has been to their bankers. delivered to the company but which have not been Dividend shall be paid (i) in respect of shares held registered for any valid reason shall be transferred

CHARTERED SECRETARY I DECEMBER 2016 141 to the Unpaid Dividend Account. address. If a Member authorises the company in writing to 5.4 Initial validity of the Dividend cheque or warrant pay the Dividend to the transferee specified in the shall be for three months. instrument of transfer, the company shall act upon A cheque or warrant for payment of Dividend shall such authorisation. However, where such instrument be valid for a period of three months from the date of is not valid for any reason, the company shall not act issue. Where such cheque or warrant remains unpaid upon such authorisation and intimate the concerned after the initial period of validity, a fresh instrument Member accordingly. shall be issued in lieu thereof, within fifteen days of In case of shares which have not been transferred the receipt of a valid request in this regard and such because the ownership thereof is in dispute, or where instrument shall also have a validity of three months attachment/prohibitory orders have been passed by a from the date of its issue. court or statutory authority, Dividend should be kept Particulars of every fresh cheque or warrant issued in abeyance by transferring to the Unpaid Dividend by the company shall be entered in a Register of Account. Dividend Warrants kept for the purpose indicating the name of the person to whom the instrument is issued 5. Payment of Dividend the number and amount of such instrument and the 5.1 Dividend shall be deposited in a separate date of issue. bank account within five days from the date 5.5 A duplicate Dividend cheque or warrant shall be of declaration and shall be paid within thirty issued only after obtaining requisite indemnity/ days of declaration. The intervening holidays, declaration from the concerned member and if any, falling during such period shall be after ascertaining the encashment status of the included. original Dividend cheque or warrant. The amount deposited in such bank account shall be In case of defaced, torn or decrepit Dividend cheque utilised only for the payment of dividend or for transfer or warrant, a duplicate instrument may be issued on to unpaid dividend account/Investor Education and surrender of such defaced, torn or decrepit instrument Protection Fund and for no other purpose. to the company. In case of non-receipt of dividend 5.2 Where a tax on distribution of Dividend is levied warrant by the shareholder and if the same is not on the company, such tax shall be paid within the returned undelivered to the company, a duplicate prescribed time. warrant may be issued by the company after verifying 5.3 Dividend shall be paid in cash and not in kind. the encashment status. Dividend payable in cash may be paid through payable Particulars of every duplicate Dividend cheque or at par cheque or warrant or in any electronic mode of warrant issued as aforesaid shall be entered in payment approved by the Reserve Bank of India. a Register of Duplicate Dividend Warrants kept To curb the practices of fraudulent encashment for the purpose, indicating the name of the person of Dividend, the company shall endeavour to to whom the instrument is issued, the number and pay Dividend directly to the bank accounts of the amount of the instrument in lieu of which the duplicate Members through any one of the electronic modes instrument is issued and the number & date of issue specified by the Reserve Bank of India viz. electronic of such duplicate instrument. clearing services (local, regional or national), direct 5.6 The Dividend cheque or warrant shall be credit, real time gross settlement, national electronic accompanied by a statement in writing showing funds transfer etc. Where Dividend is remitted the amount of Dividend paid, Folio no./DP ID through electronic mode, the company shall send and Client ID nos., number of shares held by the to the member, a statement in writing showing the concerned Member as on the record date, amount amount of Dividend paid. paid up on each share and the financial year to Where payment of Dividend is not possible through which the Dividend pertains. any electronic mode, such dividend shall be paid by 5.7 Dividend shall be paid proportionately on the way of cheque payable at par or dividend warrant. paid-up value of shares. The cheque or warrant shall be sent to the registered Unless the Articles provide otherwise, Dividend shall address of the Member and, in the case of joint be paid in proportion to the amount paid-up on the holders, to the registered address of the member shares and for the portion of the period of the financial named first in the Register of Members or to such year in respect of which it is paid. If any shares are person or to such address as the Member or the joint issued in between the financial year on the terms that holders have directed, in writing. they shall rank for Dividend from a particular date, When payment is made by Dividend warrant, the Dividend on such shares shall be paid accordingly. name of the bank and account number, if available, 5.8 Calls in arrears and any other sum due from a shall be mentioned in the warrant after the name. In Member in relation to the shares of the company case these are not available, address of the member may be adjusted against Dividend payable to the shall be printed after the name. Member. In case of payment of dividend through warrant or In the case of listed companies, calls in arrears or cheque payable at par, if the amount of dividend any other sum due from a Member in relation to the exceeds one thousand and five hundred rupees, the shares of the company, may be adjusted against the company shall ensure to despatch such dividend Dividend payable to him after giving such notice, as warrant or cheque either by speed post or registered may be required. In the case of other companies, post to the concerned Member at his registered unless the Articles provide otherwise, any other sums

142 DECEMBER 2016 I CHARTERED SECRETARY due from a Member, in a capacity other than as a (a) It shall send a statement to the Investor Education Member, may also be adjusted against the Dividend and Protection Fund (IEPF) Authority in the payable to him. prescribed form containing the details of transfer 5.9 No dividend shall bear interest against the of unpaid or unclaimed Dividend to the Fund company except in case of default in payment of and obtain a receipt from the IEPF Authority in dividend or despatch of dividend warrant/cheque evidence of such transfer. Such statement shall within the prescribed period. be furnished within thirty days of transfer of However, no default shall be deemed to have been unpaid or unclaimed Dividend to IEPF. committed, if- (b) It shall maintain record consisting of name, last (a) the Dividend could not be paid by reason of the known address, amount, Folio no., DP ID / Client operation of any law; ID no., certificate number, beneficiary details etc. (b) a Shareholder has given directions to the of the persons in respect of whom unclaimed or company regarding the payment of Dividend and unpaid Dividend is transferred to the Fund. those directions cannot be complied with and the (c) It shall not transfer any Dividend to the Fund where same has been communicated to the concerned there is a specific order of Court or Tribunal or any shareholder; other statutory authority restraining such transfer. (c) there is a dispute regarding the right to receive It shall furnish details of such unpaid Dividend to the Dividend; the IEPF Authority in the prescribed form within (d) the Dividend has been lawfully adjusted by the thirty days from the end of the financial year. company against any sum due to it from the (d) It shall file with the IEPF Authority within thirty Shareholder; or days of the end of a financial year, a statement (e) for any other reason, the failure to pay the in the prescribed format containing the details Dividend or to post the cheque or warrant within of the unclaimed or unpaid Dividend due to be the prescribed period was not due to any default transferred to the Fund in the next financial year. on the part of the company. (e) Within thirty days of closure of financial statements for a financial year, the company shall furnish 6. Unpaid Dividend another statement to the IEPF Authority stating 6.1 The amount of Dividend which remains unpaid therein reasons for deviation, if any, between or unclaimed after thirty days from the date of its the unclaimed or unpaid Dividend detailed in the declaration shall be transferred to a special bank earlier statement under (d) above and the actual account titled as ‘Unpaid Dividend Account’ to be Dividend transferred to the Fund. opened by the company in that behalf with any Any claimant of unpaid or unclaimed dividend scheduled bank. Such transfer shall be made transferred to the fund, shall be entitled to apply for within seven days from the date of expiry of the refund from the Investor Education and Protection thirty days period from the date of declaration of Fund, after following the prescribed procedure. dividend. 6.3 Before transferring any unclaimed or unpaid The company shall within a period of ninety days of Dividend to the Investor Education and Protection transferring such amount to ‘Unpaid Dividend Account’ Fund, the company shall give an individual prepare a statement containing the names, last known intimation to the Members in respect of whom addresses and the amount of Dividend to be paid to such unclaimed Dividend is being transferred, at each of the Members. Such statement shall be uploaded least three months before the due date of such on the website of the company, if any, and also on the transfer. website specified by the Central Government for this The company shall intimate the concerned Members purpose. Such statement shall remain on the website(s) individually of the amount of Dividend remaining till such time the unpaid or unclaimed Dividend is unclaimed or unpaid which is liable to be transferred transferred to the Fund and be updated by the company to the Fund and advise the Members to claim such at regular intervals, atleast on a quarterly basis. amount of Dividend from the company before such Any person claiming to be entitled to any amount transfer. transferred to the Unpaid Dividend Account may apply 6.4 Any interest earned on the Unpaid Dividend to the company for payment of such amount. Account shall also be transferred to the Investor 6.2 Any amount in the Unpaid Dividend Account of Education and Protection Fund. the company which remains unpaid or unclaimed If the Unpaid Dividend Account is kept as a fixed for a period of seven years from the date of deposit or in any account on which interest is earned, transfer of such amount to the Unpaid Dividend the interest earned shall also be transferred to the Account, along with interest accrued, if any, shall Fund. be transferred to the Investor Education and 6.5 All shares in respect of which dividend has not Protection Fund. been paid or claimed for seven consecutive years Any transfer to the Fund shall be made within thirty or more shall be transferred by the company in the days from the expiry of seven years from the date name of Investor Education and Protection Fund. of transfer of unpaid or unclaimed Dividend to the In case any dividend is paid or claimed for any year Unpaid Dividend Account. during the said period of seven consecutive years, With respect to transfer of unpaid or unclaimed such shares shall not be transferred to the Fund. Dividend to the Fund, the company shall ensure Before transfer of such shares to the Fund, the compliance with the following requirements: company shall send individual notice to the concerned

CHARTERED SECRETARY I DECEMBER 2016 143 members at least three months in advance at his shall also be disclosed. latest available address registered with the company giving details of the Members and the shares due 10. Additional Compliances for Listed for transfer to the Fund. Such details shall also be Company uploaded on the website of the company, if any. In addition to the above, a Listed Company shall A notice shall also be simultaneously published in leading ensure compliance with the requirements covered newspapers in English and regional language circulating under Annexure-A. in the district and having wide circulation in the place where the registered office of the company is situated. EFFECTIVE DATE: This Standard shall come into Any claimant of shares transferred to the Fund, effect from______shall be entitled to claim such shares in accordance with such procedure and on submission of such Annexure A documents as prescribed. The company shall not transfer any shares or dividend A Listed Company shall conform to the following: amount to the Fund, where there is a specific order of Court or Tribunal or any other statutory authority (i) The equity shares allotted by the company shall rank pari restraining any transfer of shares and payment of passu with the existing equity shares for the purpose of Dividend. payment of Dividend, if the same are in existence as on the record date/book closure. 7. Revocation of Dividend (ii) The company shall not issue shares in any manner 7.1 Dividend, once declared, becomes a debt and which may confer on any person, superior rights as to shall not be revoked. voting or Dividend vis-à-vis the rights on equity shares that are already listed. (iii) The company shall give prior intimation to the Stock 8. Preservation of Dividend Cheques, Exchange(s) about the Board meeting in which Dividend Warrants and Dividend Registers is proposed to be recommended / declared, atleast 8.1 Dividend cheques or warrants returned by the two working days in advance excluding the date of the Bank, after payment thereof, and the Dividend meeting and the date of the intimation. Registers shall be preserved by the company for (iv) The company shall intimate the Stock Exchange(s), a period of eight years. the record date fixed for the purpose of declaration Where the company has given an undertaking to of Dividend at least seven working days in advance the Bank for preservation or safe keeping of paid excluding the date of the intimation and the record date. Dividend cheques or warrants for a specified period, (v) The company shall recommend or declare dividend the said instruments shall be preserved for such at least five working days before the record date fixed specified period or eight years from the date of the for the purpose. The said period of five working days instrument, whichever is longer. is excluding the date of declaration/recommendation of The dividend cheques or warrants so preserved shall dividend and the record date fixed for the purpose. be destroyed only with the approval of the Board or in (vi) The company shall disclose the outcome of the Board accordance with the policy approved by the Board for Meeting held to consider the dividend matters, to the this purpose. Stock Exchange(s) within 30 minutes of closure of the meeting. In case of recommendation / declaration of 9. Disclosure Dividend, the intimation shall also include the date on 9.1 The Balance Sheet of the Company shall disclose which such Dividend shall be paid. the aggregate amount of Dividend proposed to be (vii) In case of payment of Dividend through warrant or cheque distributed to equity and preference shareholders payable at par, if the amount of dividend exceeds one for the financial year and the related amount of thousand and five hundred rupees, the company shall Dividend per share. Arrears of fixed cumulative despatch such dividend warrant or cheque by speed post dividend on preference shares shall also be to the concerned Member at the registered address. disclosed separately. (viii) The Company shall declare and disclose Dividend on 9.2 The Balance Sheet of the company shall also per share basis only. disclose under the head ‘Current Liabilities and (ix) The Company shall not forfeit unclaimed Dividends before Provisions’, the amount lying in the Unpaid the claim becomes barred by law and such forfeiture, if Dividend Account together with interest accrued effected, shall be annulled in appropriate cases. thereon, if any. (x) Top five hundred Listed Companies based on market 9.3 The amount of interim dividend, if any, paid capitalisation as on 31st March every financial year, during the financial year and final Dividend shall formulate a Dividend Distribution Policy covering recommended by the Board of directors shall be the prescribed parameters by Securities and Exchange disclosed in the Board’s Report. Board of India (SEBI). Such policy shall be disclosed in 9.4 The Annual Report of the company shall disclose the Annual Report of the Company and also be placed the total amount lying in the Unpaid Dividend on its website. Account of the company in respect of the last (xi) The Company shall disclose in its Corporate Governance seven years. The amount of Dividend, if any, Report the Dividend payment date under the General transferred by the company to the Investor Shareholder Information Section. Education and Protection Fund during the year

144 NOVDECEMBEREMBER 2016 I CHARTERED SECRETARY Exposure Draft SECRETARIAL STANDARD ON REPORT OF THE BOARD OF DIRECTORS

he following is the text of Secretarial Standard on “Report of “Act” means the Companies Act, 2013 (Act No. 18 of 2013) or any the Board of Directors”, issued by the Council of the Institute previous enactment thereof, or any statutory modification thereto T of Company Secretaries of India. or re-enactment thereof and includes any Rules and Regulations Adherence by a company to this Secretarial Standard is framed there under. recommendatory. “Associate company”, in relation to another company, means a (In this Secretarial Standard, the Standard portions have company in which that other company has a significant influence, been set in bold type. These shall be read in the context of but which is not a subsidiary company of the company having the background material which has been set in normal. Both such influence and includes a joint venture company. the Standard portions and the background material have Explanation— For the purposes of this clause, “significant equal authority) influence” means control of at least twenty per cent of total share capital, or of business decisions under an agreement. INTRODUCTION Term ‘total share capital’ means aggregate of the (a) the paid-up The Companies Act, 2013 requires the Board of Directors of every equity share capital and (b) convertible preference share capital. company to present Financial Statements to the shareholders “Board of Directors” or “Board” in relation to a company, means alongwith their Report known as the “Report of the Board of the collective body of the directors of the company. Directors” or “Board’s Report”. “Body Corporate” or “Corporation” includes a company The Board’s Report is the most important means of communication incorporated outside India, but does not include— by the Board of Directors of a company with its stakeholders. The (i) a co-operative society registered under any law relating to Board’s Report should, so far as it is material for the appreciation co-operative societies; and of the state of the company’s affairs by its shareholders, deal with (ii) any other body corporate (not being a company as defined in any changes which have occurred during the financial year. The this Act),which the Central Government may, by notification, Board’s Report should cover such information that would assist specify in this behalf. the stakeholders in understanding the business operations, “Committee” means a Committee of Directors mandatorily prospects of the company’s business and quality of management. required to be constituted by the Board under the Act. This Report serves to provide the stakeholders with both financial “Company” means a company incorporated under the Act or and non-financial information, including the performance and under any previous company law. prospects of the company, relevant changes in the management, “Employees’ Stock Option” means the option given to the capital structure, major policies, recommendations as to the directors, officers or employees of a company or of its holding distribution of profits, future and ongoing programmes of company or subsidiary company or companies, if any, which expansion, modernization and diversification, capitalization of gives such directors, officers or employees, the benefit or right reserves, further issue of capital and other relevant information. to purchase, or to subscribe for, the shares of the company at a The Companies Act, 2013 (“the Act”) mandates certain disclosures future date at a pre-determined price. in the Board’s Report. Further, certain additional disclosures, as “Financial Year” in relation to any company or body corporate, applicable, are also required to be made in the Board’s Report under means the period ending on the 31st day of March every year, various other enactments viz. SEBI (Listing Obligations and Disclosure and where it has been incorporated on or after the 1st day of Requirements) Regulations, 2015 (“Listing Regulations”), SEBI January of a year, the period ending on the 31st day of March of (Share Based Employee Benefits) Regulations, 2014, Disclosure the following year, in respect whereof financial statement of the under the Sexual Harassment of Women at Workplace (Prevention, company or body corporate is made up. Prohibition and Redressal) Act, 2013 etc. Provided that on an application made by a company or body However, companies which are governed by/registered under a corporate, which is a holding company or a subsidiary of a separate enactment shall be required to make additional disclosures company incorporated outside India and is required to follow a in their Board’s Report as stated in the respective enactments. different financial year for consolidation of its accounts outside For companies whose securities are listed on an overseas India, the Tribunal may, if it is satisfied, allow any period as its stock exchange, they shall be required to comply with additional financial year, whether or not that period is a year. requirements as may be specified by such stock exchanges. “Financial Statement” in relation to a company, includes - (i) a balance sheet as at the end of the financial year; SCOPE (ii) a profit and loss account, or in the case of a company carrying This Standard prescribes a set of principles for preparation and on any activity not for profit, an income and expenditure presentation of the Report of the Board of Directors of a company account for the financial year; and matters relating thereto. (iii) cash flow statement for the financial year; The principles enunciated in this Standard are in conformity with (iv) a statement of changes in equity, if applicable; and the provisions of the Act and other laws as mentioned above. (v) any explanatory note annexed to, or forming part of, any However, if, due to subsequent changes in the Act or any document referred to in sub-clause (i) to sub-clause (iv). other laws, a particular Standard or any part thereof becomes “Holding Company” in relation to one or more other companies, means inconsistent with the Act or other laws, the provisions of the Act a company of which such companies are subsidiary companies. or other laws shall prevail. “Housing Finance Company” means a company as defined under the Housing Finance Companies (National Housing Bank) DEFINITIONS Directions, 2010. The following terms are used in this Standard with the meaning “Key Managerial Personnel” (KMP), in relation to a company, specified: means—

CHARTERED SECRETARY I DECEMBERNOVEMBER 20162016 145 (i) the Chief Executive Officer or the Managing Director or the 1. FUNDAMENTAL DISCLOSURES Manager; The Board’s Report shall be prepared based on the (ii) the Company Secretary; Standalone Financial Statements of the company and shall (iii) the Whole-time Director; relate to the financial year in relation to which such Statements (iv) the Chief Financial Officer; and are prepared. It should include the following disclosures: (v) such other officer as may be prescribed. 1.1 Financial summary and highlights “Listed Company” means a company which has any of its Key highlights of financial performance of the company securities listed on any recognised stock exchange. viz. Turnover, Profit Before Tax and Profit After Tax. “Member” in relation to a company, means— 1.2 Details of revision of Financial Statements or Board’s (i) the subscriber to the memorandum of the company who Report shall be deemed to have agreed to become member of In case the company has voluntarily revised its Financial the company, and on its registration, shall be entered as Statements or Board’s Report in respect of any of the three member in its register of members; preceding financial years, the detailed reasons for such (ii) every other person who agrees in writing to become a revision should be disclosed in the Board’s Report of the member of the company and whose name is entered in the relevant financial year in which such revision is being made. register of members of the company; 1.3 Amount, which the Board proposes to carry to any (iii) every person holding shares of the company and whose reserves name is entered as a beneficial owner in the records of a The Report should disclose the amount, if any, proposed by depository; the company to be transferred to its reserves. If no amount “Miscellaneous Non-Banking Company” means a company as is proposed to be transferred to reserves, a statement to defined under Miscellaneous Non-Banking Companies (Reserve that effect should be incorporated in the Board’s Report. Bank) Directions, 2016. 1.4 Dividend “Non-Banking Financial Company” or “NBFCs” means a company The Board’s Report shall disclose the amount per share and as defined in the Reserve Bank of India Act, 1934. the percentage which the Board recommends to be paid “Other Laws” means any law other than the Act which requires as dividend. If any interim dividend has been paid during disclosures in the Board’s Report and as mentioned in this the year, details of the amount per share and percentage Standard. of such interim dividend should also be disclosed in the “Preference Share Capital”, with reference to any company Board’s Report. The total amount to be utilized for payment limited by shares, means that part of the issued share capital of of dividend (both interim and final) should be disclosed, the company which carries or would carry a preferential right with stating separately the total outgo on account of dividend respect to— and the dividend distribution tax thereon, along with the (a) payment of dividend, either as a fixed amount or an amount corresponding figures of the previous year. calculated at a fixed rate, which may either be free of or If no dividend has been recommended or declared during subject to income-tax; and the year, a statement to that effect should be incorporated (b) repayment, in the case of a winding up or repayment of in the Board’s Report. capital, of the amount of the share capital paid-up or deemed Details of transfer of dividend or shares to the Investor to have been paid-up, whether or not, there is a preferential Education and Protection Fund, if any, shall also be right to the payment of any fixed premium or premium on any disclosed in the Board’s Report. fixed scale, specified in the memorandum or articles of the 1.5 Major events during the year company. a) State of the company’s affairs “Producer Company” means a body corporate having objects The state of affairs of the company should relate to or activity specified in Section 581B and registered as Producer the period for which the Financial Statements have Company under the Companies Act, 1956. been prepared. Information and data which are usually “Promoter” means a person - considered pertinent and necessary for the purpose of (a) who has been named as such in a prospectus or is identified proper appreciation of the state of affairs of a company by the company in the annual return; or relating to the period for which the Financial Statements (b) who has control over the affairs of the company, directly or have been prepared must be disclosed in the Report. indirectly whether as a shareholder, director or otherwise; or Illustrative list of information that may be included in the (c) in accordance with whose advice, directions or instructions Report are as follows - the Board of Directors of the company is accustomed to act. • change in status of the company, if any; Provided that nothing in sub-clause (c) shall apply to a person • change in financial year, if any; who is acting merely in a professional capacity. • major capital expenditure programmes; “Report” means Board’s Report or the Report of the Board of • details and status of acquisition, mergers, expansion, Directors. modernization and diversification; “Residuary Non-Banking Company” means a company as • development, acquisition and assignment of defined under Residuary Non-Banking Companies (Reserve Intellectual Property Rights (IPRs); Bank) Directions, 2016. • any other material event which has an impact on the “Securities” means the securities as defined in clause (h) of affairs of the company. section 2 of the Securities Contracts (Regulation) Act, 1956; b) Change in the nature of business Words and expressions used and not defined herein shall have In case the company has commenced any new the meaning respectively assigned to them under the Act. business or discontinued any of its existing business during the year, the Board’s Report SECRETARIAL STANDARDS should disclose the details of such business and It is the Board’s responsibility to prepare and submit its Report the reasons for the same. to the shareholders with reference to the matters set out in the c) Material changes and commitments, if any, affecting Act and other laws, and attach the said Report to the Financial the financial position of the company which have Statements laid before the company at its annual general occurred between the end of the financial year of meeting.

146 DECEMBER 2016 I CHARTERED SECRETARY the company to which the Financial Statements (g) the diluted Earnings Per Share pursuant to the issue relates and the date of the Report of each class of shares, calculated in accordance The Board’s Report shall include material changes and with the applicable accounting standards; commitments, if any, affecting the financial position of the (h) the pre and post issue shareholding pattern alongwith company and occurring between the date of the Balance voting rights in the format specified under the Act. Sheet and the date of the Report. The effect of such 3.3 Issue of Sweat Equity Shares material events and an estimate of their financial impact During the financial year, if the company has issued sweat should also be disclosed in the Report. If evaluation of equity shares, the following disclosures should be made in the such an estimate cannot be explicitly made, a statement Report of the financial year in which such shares are issued: may be incorporated in the Report to that effect. It is also (a) the class of Directors or employees to whom sweat desirable to mention the causes for such material events equity shares are issued; and the remedial measures in the Report. (b) the class of shares issued as sweat equity shares; (c) the number of sweat equity shares issued to the 2. GENERAL INFORMATION Directors, Key Managerial Personnel or other 2.1 Brief history of the company, overview of the industry and employees showing separately the number of such important changes in the industry during the last financial year; shares issued to them, if any, for consideration other 2.2 Brief description of business segments and geographic than cash and the individual names of allottees segments; holding 1% or more of the issued share capital; 2.3 External environment and economic outlook; (d) the reasons or justification for the issue; 2.4 Induction of strategic and financial partners during the last (e) the principal terms and conditions for issue of sweat financial year; equity shares, including pricing formula; 2.5 Brief description of the whistleblower mechanism and (f) the total number of shares arising as a result of issue mechanism evolved for redressal of stakeholder’s grievances. of sweat equity shares; (g) the percentage of the sweat equity shares to the total 3. CAPITAL STRUCTURE post issued and paid up share capital; The Board’s Report shall contain details of any changes (h) the consideration (including consideration other than in the capital structure of the company during the financial cash) received or benefit accrued to the company year viz. issue of shares with differential rights, issue of from the issue of sweat equity shares; sweat equity, ESOP, issue/redemption of debentures etc. (i) the diluted Earnings Per Share pursuant to issue of 3.1 Details of preference and equity shares issued sweat equity shares. During the financial year, if the company has issued any 3.4 Issue of employee stock options equity shares or preference shares, including shares Listed Companies issued upon conversion of securities, the following Listed Companies shall make the following disclosures in the disclosures should be made in the Report: Board’s Report as required under the SEBI (Share Based • Date of allotment Employee Benefits) Regulations, 2014 as detailed below: • Method of allotment (QIP, FPO, GDRs, Rights, (a) Material change(s) to the employee stock options preferential, private placement, ESOP, conversion of scheme(s). securities etc.) (b) Whether such scheme(s) is in compliance with the SEBI • Issue Price/Conversion Price (Share Based Employee Benefits) Regulations, 2014. • Number of shares allotted Listed Companies shall also make additional disclosures, • Number of shares allotted to promoter group(including as detailed in Annexure 1, on their websites with web-link shares represented by Depository Receipts) being disclosed in the Board’s Report. • In case shares are issued for consideration other Unlisted Companies than cash, a confirmation that price of such shares Unlisted Companies shall disclose the following details in was determined on the basis of valuation report of the their Board’s Report with respect to its Employee Stock registered valuer. Option Scheme(s): 3.2 Issue of equity shares with differential rights (a) options granted; During the financial year, if the company has issued equity (b) options vested; shares with differential rights as to dividend, voting or (c) options exercised; otherwise, the following disclosures should be made in the (d) the total number of shares arising as a result of Report of the financial year in which such issue is completed: exercise of options; (a) the total number of shares allotted with differential (e) options lapsed; rights; (f) the exercise price; (b) the details of the differential rights relating to voting (g) variation of terms of options; rights and dividend; (h) money realized by exercise of options; (c) the percentage of the shares with differential rights (i) total number of options in force; to the total post issue equity share capital with (j) employee wise details of options granted to;- differential rights issued at any point of time and i. Key Managerial Personnel; percentage of voting rights which the equity share ii. any other employee who receives a grant of capital with differential voting rights shall carry to options in any one year of options amounting to 5% the total voting rights of the aggregate equity share or more of total options granted during that year. capital; iii. identified employees who were granted options, (d) the price at which such shares have been issued; during any one year, equal to or exceeding 1% (e) the particulars of Promoters, Directors or Key of the issued capital (excluding outstanding Managerial Personnel to whom such shares are issued; warrants and conversions) of the company at the (f) the change in control, if any, in the company time of grant. consequent to the issue of equity shares with 3.5 Issue of shares to trustees for benefit of employees differential voting rights; A company may introduce scheme(s) for purchase/

CHARTERED SECRETARY I DECEMBER 2016 147 subscription of the company’s shares to be held by trustees the date of the Report. for the benefit of employees. In such cases, where the Systemically Important Non-Deposit taking NBFCs and voting rights are not exercised directly by the employees in Deposit taking NBFCs may state in the Board’s Report respect of shares to which the scheme relates, the Board’s that appointment / re-appointment of Directors has been Report shall disclose the following details:- done in accordance with the Policy for ascertaining fit and a. the names of the employees who have not exercised proper criteria of the Directors. the voting rights directly; 4.2 Statement on declaration by Independent Directors b. the reasons for not voting directly; The Report shall contain a statement that necessary c. the name of the person who is exercising such voting declaration with respect to independence, as required rights; under the Act, has been received from all the Independent d. the number of shares held by or in favour of such Directors of the company. employees and the percentage of such shares to the 4.3 Number of Board & Committee Meetings total paid up share capital of the company; The number and dates of Meetings of the Board and e. the date of the general meeting in which such voting its Committees held during the financial year should be power was exercised; disclosed in the Board’s Report, indicating the number of f. the resolution(s) on which votes have been cast by Meetings attended by each Director/Committee Member. persons holding such voting power; 4.4 Composition of Committees and details of changes, g. the percentage of such voting power to the total if any voting power on each resolution; The Board’s Report should disclose composition of various h. whether the votes were cast in favour of or against Committees constituted by the Board of the company and the resolution. changes in their composition during the year. 3.6 Issuance of any other securities which carries a right The following Committees are required to be constituted or option to convert into equity shares by prescribed class of companies under the Act: During the financial year, if the company has issued any (a) Audit Committee securities which carry a right or option to convert such (b) Nomination and Remuneration Committee securities into equity shares, the following disclosures (c) Corporate Social Responsibility Committee should be made in the Report: (d) Stakeholders Relationship Committee • Date of issue and allotment Further, in cases where the Board has not accepted any • Method of allotment (QIP, FPO, GDRs, Rights, recommendation of the Audit Committee, the same shall preferential, private placement etc.) be disclosed in the Report along with the reasons therefore. • Issue Price 4.5 Company’s Policy on Director’s appointment and • Conversion Price remuneration • Number of equity shares to be allotted in case the The prescribed class of companies shall formulate a option is exercised by all the holders of such securities Policy relating to the remuneration of Directors, Key • Number of securities allotted to promoter group Managerial Personnel and other employees and disclose • In case such securities are issued for consideration the said Policy either in the Report or by way of an other than cash, a confirmation that price of such annexure thereto. Such Policy should be recommended securities was determined on the basis of valuation by the Nomination and Remuneration Committee and report of a registered valuer. approved by the Board. 3.7 Credit Rating The prescribed class of companies should also disclose The Board’s Report shall state the details of any new the criteria for determining qualifications, positive credit rating or revision in the rating obtained for various attributes and independence of Directors, as approved by securities of the company during the year. In case of a the Nomination and Remuneration Committee. downward revision in ratings, the company should also 4.6 Board Evaluation intimate the reasons provided by the rating agency for The prescribed class of companies shall include a such downward revision. statement in the Report indicating the manner in which formal annual evaluation has been made by the Board 4. MANAGEMENT of its own performance and that of its Committees and 4.1 Directors and Key Managerial Personnel individual Directors, on an annual basis. Such evaluation The Report should disclose the name(s) of person(s) who should be based on criteria approved by the Nomination have been appointed as/ceased to be Directors, including and Remuneration Committee. Independent Directors, and Key Managerial Personnel of 4.7 Details of remuneration of Directors of Listed Companies the company during the year. In case of resignation of a Every Listed Company shall make the following disclosures Director during the year, such fact shall also be disclosed relating to the remuneration of Directors, either in the body in the Board’s Report. of the Report or by way of an annexure thereto: Further, in case an Independent Director is re-appointed (a) The number of permanent employees on the rolls of after completion of a term of five years by passing a the company; special resolution, the Board’s Report should contain a (b) The ratio of remuneration of each Director to the disclosure of such appointment. median remuneration of the employees of the Companies should also disclose names of the Directors company for the financial year; retiring by rotation at the concerned annual general [(i) The expression “median” means the numerical meeting and whether or not they offer themselves for value separating the higher half of a population from re-appointment, and the names of Directors who have the lower half and the median of a finite list of numbers incurred any disqualification or who have vacated their may be found by arranging all the observations from office (during the reporting period) pursuant to the lowest value to highest value and picking the middle provisions of the Act or other laws. one; (ii) if there is an even number of observations, the The Board may voluntarily disclose such changes that median shall be the average of the two middle values.] took place after the end of the financial year but before (c) The percentage increase in remuneration of each

148 DECEMBER 2016 I CHARTERED SECRETARY Director, Chief Financial Officer, Chief Executive 4.11 Disclosure regarding frauds Officer, Company Secretary or Manager, if any, in the If an Auditor (including Statutory Auditor, Secretarial financial year; Auditor and Cost Auditor) of a company in the course (d) The percentage increase in the median remuneration of performance of his duties as Auditor, has reason(s) of employees in the financial year; to believe that an offence of fraud is being or has been (e) Average percentile increase already made in committed in the company by its officers or employees, the salaries of employees other than managerial the Auditor shall report such frauds to the Audit Committee personnel in the last financial year and its comparison or to the Board (in cases where the company does not with the percentile increase in the managerial have an Audit Committee). Frauds involving amounts remuneration and justification thereof and point out if exceeding the prescribed ceilings are also required to be there are any exceptional circumstances for increase reported to the Central Government. in the managerial remuneration; The following details of frauds reported by the Auditor (f) Affirmation that the remuneration is as per the (other than the frauds required to be reported to the remuneration policy of the company. Central Government) shall be disclosed in the Board’s 4.8 Remuneration received by Managing / Whole time Report:- Director from holding or subsidiary company (a) Nature of Fraud with description; In case the Managing/Whole time Director of the company (b) Approximate amount involved; receives any commission from the company, he/she shall (c) Parties involved, if remedial action not taken; and not be disqualified from receiving any remuneration or (d) Remedial action taken. commission from the holding company or subsidiary company If there are no frauds reported by the Auditor to the Audit of such company subject to disclosure of such remuneration Committee or to the Board, a statement to this effect may or commission in the Board’s Report of the company. be given by the Board in the Report as a good practice. Thus, a company should disclose in its Board’s Report remuneration or commission from any holding company 5. DISCLOSURES RELATING TO or subsidiary company received by Managing/Whole time Director. SUBSIDIARIES, ASSOCIATES AND 4.9 Directors’ Responsibility Statement JOINT VENTURES The Report shall include a Directors’ Responsibility 5.1 Report on performance and financial position of each Statement which shall set out the following details: of the subsidiaries, associates and joint ventures (a) in the preparation of the Annual Accounts, the In case of companies having subsidiaries, associates and applicable Accounting Standards have been followed joint ventures, the Report shall contain a separate section along with proper explanation relating to material highlighting the performance of each of the subsidiaries, departures; associates and joint venture companies and their (b) the Directors have selected such accounting policies contribution to the overall performance of the company and applied them consistently and made judgments during the reporting period. The said separate section and estimates that are reasonable and prudent so as may be given by the companies in Form AOC-1. to give a true and fair view of the state of affairs of the 5.2 Companies which have become or ceased to be company at the end of the financial year and of the subsidiaries, associates and joint ventures profit and loss of the company for that period; During the year, if the company has acquired or formed (c) the Directors have taken proper and sufficient care any new subsidiary, associate or joint venture, the details of for the maintenance of adequate accounting records such companies should be disclosed. Similarly, if any of the in accordance with the provisions of the Act for subsidiary, associate or joint venture of the company has safeguarding the assets of the company and for ceased to be subsidiaries, associates or joint ventures by way preventing and detecting fraud and other irregularities; of sale of shares, amalgamation, winding up etc., the names of (d) the Directors have prepared the Annual Accounts on such companies should also be disclosed in the Report. a going concern basis; (e) the Directors, in the case of a listed company, have 6. DETAILS OF DEPOSITS laid down internal financial controls to be followed by The following disclosures relating to Deposits shall be the company and that such internal financial controls made in the Report: are adequate and are operating effectively; and (a) details of Deposits accepted during the year; (f) the Directors have devised proper systems to ensure (b) Deposits remaining unpaid or unclaimed as at the compliance with the provisions of all applicable laws end of the year; and that such systems are adequate and operating (c) whether there has been any default in repayment of effectively. Deposits or payment of interest thereon during the The disclosure as stated under clause (e) above is year and if so, the number of such cases and the total applicable only to Listed Companies, whereas the amount involved: other disclosures are applicable to all companies. • at the beginning of the year; The Directors’ Responsibility Statement should form • maximum during the year; part of the Report and should not be given as an • at the end of the year; Annexure to the Report. (d) details of Deposits which are not in compliance with 4.10 Internal financial controls the requirements of the Act; All companies should disclose in the Board’s Report, the (e) Details of revision, if any, in ratings assigned by credit details of internal financial controls laid in the companies rating agencies. with respect to the Financial Statements. The Board’s Report should also disclose the following Listed Companies, in addition, should also confirm, as part details with respect to Deposits: of the Directors’ Responsibility Statement, as to whether • Credit Rating obtained; they have laid down internal financial controls and whether • Name of the Credit Rating Agency; such controls are adequate and operating effectively. • Date on which the Credit Rating was obtained.

CHARTERED SECRETARY I DECEMBER 2016 149 7. PARTICULARS OF LOANS, aggregate, was not less than rupees one crore and two lakh rupees; GUARANTEES AND INVESTMENTS (b) if employed for a part of the financial year, was in The Board’s Report shall disclose full particulars of the receipt of remuneration for any part of that year, at loans given, investments made, guarantees given or a rate which, in the aggregate, was not less than securities provided during the year and the purpose for rupees eight lakh fifty thousand per month; which the loan / guarantee / security is proposed to be (c) if employed throughout the financial year or part utilised by the recipient of such loan/guarantee/security. thereof, was in receipt of remuneration in that year A company may provide the aforesaid disclosures in the which, in the aggregate, is in excess of that drawn Notes to the Financial Statements and give reference by the Managing Director or Whole-time Director thereto in the Report. or Manager and hold by himself or along with his spouse and dependent children, not less than 2% of 8. PARTICULARS OF CONTRACTS OR the equity shares of the company. ARRANGEMENTS WITH RELATED PARTIES The aforesaid Statement should also indicate the A company shall disclose details of the following contracts/ following – arrangements/transactions with its related parties: 1. Designation of the employee; (a) contracts / arrangements / transactions with related 2. Remuneration received; parties which are not at arm’s length; and 3. Nature of employment, whether contractual or (b) material contracts / arrangements / transactions with otherwise; related parties which are at arm’s length. 4. Qualifications and experience of the employee; Such disclosure should be made in the prescribed Form 5. Date of commencement of employment; AOC-2. 6. The age of such employee; Companies may determine the materiality threshold for 7. The last employment held by such employee before the purpose of clause (b) above. joining the company; For this purpose, Listed Companies may refer to the materiality 8. The percentage of equity shares held by the threshold prescribed under SEBI (Listing Obligations and employee in the company within the meaning of Disclosure Requirements) Regulations, 2015. Clause (c) as stated above; 9. Whether any such employee is a relative of any Director or Manager of the company and if so, name 9. DISCLOSURES PERTAINING of such Director or Manager. TO CORPORATE SOCIAL The particulars of employees posted and working in a RESPONSIBILITY country outside India, not being Directors or their relatives, The Board’s Report of the prescribed class of companies drawing more than sixty lakh rupees per financial year or shall disclose the details of corporate social responsibility five lakh rupees per month, as the case may be, as may initiatives undertaken by companies during the year. be decided by the Board, shall not be circulated to the Such disclosure should contain the following: members in the Board’s Report, but such particulars shall (a) Brief outline of the company’s CSR Policy, including be filed with the Registrar of Companies while filing the overview of the projects or programs proposed to be Financial Statements and the Board’s Report. undertaken and a reference to the web link of such Policy being put up on the website of the company. 11. CONSERVATION OF ENERGY, (b) Composition of the CSR Committee. (c) Average net profits of the company for the last three TECHNOLOGY ABSORPTION, financial years. FOREIGN EXCHANGE EARNINGS (d) Prescribed CSR expenditure [i.e. 2% of Clause (c) AND OUTGO above]. The Report should disclose the following information: (e) Details of CSR spend during the financial year (a) Conservation of energy - including total amount to be spent, amount unspent (i) the steps taken or impact on conservation of and manner in which the amount has been spent. energy; In case the prescribed CSR expenditure has not been (ii) the steps taken by the company for utilising made, the Board should specify the reasons for not alternate sources of energy; spending the amount. (iii) the capital investment on energy conservation Further, the aforesaid disclosure should also contain a equipments. responsibility statement from the CSR Committee that (b) Technology absorption - the implementation and monitoring of the CSR Policy is (i) the efforts made towards technology absorption; in compliance with the CSR objectives and policy of the (ii) the benefits derived like product improvement, company. cost reduction, product development or import The aforesaid information can be given by way of an substitution; Annexure to the Report. (iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year under reference) – 10. DETAILS OF REMUNERATION • the details of technology imported; OF EMPLOYEES • the year of import; The Board’s Report shall include a statement showing • whether the technology has been fully absorbed the names of top ten employees in terms of remuneration and if not, areas where absorption has not taken drawn and the name of every employee who: place, and the reasons thereof; (a) if employed throughout the financial year, was in (iv) the expenditure incurred on Research and receipt of remuneration for that year which, in the Development. (c) Foreign exchange earnings and Outgo – The Foreign

150 DECEMBER 2016 I CHARTERED SECRETARY Exchange earned in terms of actual inflows during the 17. EXPLANATIONS IN RESPONSE TO year and the Foreign Exchange outgo during the year in terms of actual outflows. AUDITORS’ QUALIFICATIONS The Report should contain the information and In cases where such disclosures are not applicable, the explanations on every reservation, qualification or adverse Report should contain a statement to that effect. remark contained in the: • Statutory Auditor’s Report 12. RISK MANAGEMENT • Secretarial Auditor’s Report The Board’s Report shall contain a statement indicating The Report shall provide explanations or comments by the development and implementation of a risk management Board on each such reservation, qualification or adverse policy for the company which shall, inter alia, disclose remark alongwith the circumstances necessitating the various elements of risk, if any, which in the opinion of the such reservation, qualification or adverse remark, its likely Board may threaten the existence of the company and the impact on the Financial Statement and the corrective mitigation strategies adopted by the company to handle measures that are proposed to be taken. and manage such risks. If there are no qualifications, reservations or adverse remarks Every company shall frame a risk management policy made by the Statutory Auditors/Secretarial Auditors in their which should include the risk management framework and respective Report, a statement to this effect may be given by processes adopted by the company. The highlights of the the Board in the Report as a good practice. said policy may be disclosed in the Report. Listed Companies and certain classes of NBFCs are required to constitute a Risk Management Committee 18. COMPLIANCE WITH SECRETARIAL to monitor and review the risk management plan and STANDARDS process in such companies. The Board’s Report of every company shall include a statement on compliance of Secretarial Standards. 13. MATERIAL ORDERS OF REGULATORS The company should disclose the details of significant 19. DETAILS OF SICKNESS OF THE COMPANY and material orders passed by the Regulators, Courts In case the company has become a sick company, the and Tribunals impacting the going concern status of the Report should provide the factors leading to such sickness company and its future operations. and the steps proposed to be taken in this connection. 14. DETAILS OF ESTABLISHMENT OF 20. FAILURE TO COMPLETE BUY BACK In case the company has failed to complete buy-back of VIGIL MECHANISM its securities within the time prescribed under the Act, the The Board’s Report of prescribed class of companies Report should disclose the reasons for the same. shall disclose the details as to establishment of vigil Similarly, the Report should also disclose the reasons for mechanism in the companies. Such mechanism which failure to implement any proposal relating to preferential shall provide for adequate safeguards against victimization allotment or failure to pay interest or redeem debentures of Director(s) or employee(s) or any other person who or preference shares on the respective due date and the avails the mechanism and also provide for direct access remedial measures taken or proposed to be taken by to the chairperson of the Audit Committee in appropriate the company in this connection. The Report should also or exceptional cases. specify the reasons for failure, if any, to transfer dividend The Audit Committee of such companies shall oversee or shares to the Investor Education and Protection Fund the vigil mechanism. In case of companies which are not and the remedial measures taken by the company. required to constitute Audit Committee, the Board shall

nominate a Director to play the role of Audit Committee for the purpose of vigil mechanism to whom other Directors 21. EXTRACT OF ANNUAL RETURN The Report of every company shall include an Extract of and employees may report their concerns. Annual Return in Form MGT-9. The same may be given The listed companies shall devise an effective whistle by way of an Annexure to the Report. blower mechanism enabling stakeholders, including The details to be disclosed in Form MGT-9 should be as individual employees and their representative bodies, on the close of the Financial Year of the company. to freely communicate their concerns about illegal or The company may also place a copy of the annual return unethical practices. on the website of the company, if any, and the web-link of The Audit Committee of the listed companies shall be such annual return may be disclosed in the Board’s Report. responsible to periodically review the functioning of this mechanism. 22. OTHER DISCLOSURES 15. AUDITORS 22.1 The Report should state, wherever applicable, that Names of the Auditors including Statutory Auditors, Cost the consolidated financial statements are also being Auditors and Secretarial Auditors should be stated in the presented in addition to the standalone financial Report. statements of the company. The name of Statutory Auditors proposed for ratification 22.2 The Report should also include the following: (a) reasons for delay, if any, in holding annual general by the Members at the concerned annual general meeting meeting; and their remuneration proposed for approval of the (b) key business developments during the year. Members should also be stated in the Report. (c) key initiatives with respect to the following • Stakeholders relationship; 16. SECRETARIAL AUDIT REPORT • Customers relationship; The prescribed class of companies should annex with the • Environment; Board’s Report, the Secretarial Audit Report which should • Sustainability; be in Form MR-3. • Health and safety.

CHARTERED SECRETARY I DECEMBER 2016 151 23. DISCLOSURES UNDER SEBI 25. ADDITIONAL DISCLOSURES (LISTING OBLIGATIONS AND PURSUANT TO DIRECTIONS OF DISCLOSURE REQUIREMENTS) RESERVE BANK OF INDIA REGULATIONS, 2015 25.1 Systemically Important NBFCs and Deposit taking 23.1 Statement of deviation(s) or variation(s) NBFCs Listed Companies are required to submit to Stock Systemically Important Non-Deposit taking NBFCs Exchanges the following statement(s) on a quarterly and Deposit taking NBFCs should make the following basis in connection with public issue, rights issue, disclosures either in the Board’s Report or in the preferential issue etc.- Annual Report: • Statement indicating deviations, if any, in the use (a) Details of all material transactions with related of proceeds from the objects stated in the offer parties and Policy on dealing with Related Party document or explanatory statement to the notice Transactions. for the general meeting, as applicable; (b) All pecuniary relationship or transactions of the • Statement indicating category wise variation Non-Executive Directors vis-à-vis the company. (capital expenditure, sales and marketing, (c) In connection with loans given against security working capital etc.) between projected utilisation of gold jewellery, details of auction conducted of funds made by the company in its offer during the financial year including the number document or explanatory statement to the notice of loan accounts, outstanding amounts, value for the general meeting, as applicable and the fetched and whether any of its sister concerns actual utilisation of funds. participated in the auction. Listed companies shall also furnish explanations for (d) In case of issue of Perpetual Debt Instruments the aforesaid variations in the Board’s Report. (PDIs), the following: 23.2 Management Discussion and Analysis Report 1) Amount of funds raised through PDIs during Listed Companies should prepare, as part of the year and outstanding at the close of the the Board’s Report or as an addition thereto, a financial year; Management Discussion and Analysis Report which 2) Percentage of the amount of PDIs to the should include discussion on the following matters: amount of its Tier I Capital; • Industry structure and developments; 3) Financial year in which interest on PDIs has • Opportunities and Threats; not been paid in accordance with the Lock-in • Segment wise and product wise performance; clause. • Outlook; Further, the aforesaid classes of NBFCs should • Risks and concerns; prepare either as part of the Board’s Report or as • Internal control systems and their adequacy; an addition thereto, a Management Discussion and • Discussion on financial performance with respect Analysis Report which should include discussion on to operational performance; all the matters as specified in Clause 23.2 above, as • Material developments in Human Resources / applicable to Listed Companies. Industrial Relations front, including number of 25.2 NBFCs, Miscellaneous Non-Banking Companies people employed. and Residuary Companies 23.3 Certificate on compliance of conditions of The Report should include the information on: corporate governance (a) the total number of depositors with the company Listed companies shall obtain a certificate from whose deposits have not been claimed by the either the Statutory Auditors or practicing company depositors or not paid by the company after secretaries regarding compliance of conditions of the date on which the deposit became due for corporate governance as stipulated in the SEBI repayment or renewal, as the case may be, (Listing Obligations and Disclosure Requirements) according to the contract with the depositor or Regulations, 2014 and annex the certificate with the the Miscellaneous Non-Banking Companies Board’s Report. (Reserve Bank) Directions, 2016 or the Residuary Non-Banking Companies (Reserve 24. DISCLOSURES UNDER THE Bank) Directions, 2016, as applicable; and (b) the total amounts due under such accounts SEXUAL HARASSMENT OF remaining unclaimed or unpaid beyond the due WOMEN AT THE WORKPLACE date for repayment; (c) compliance with the Residuary Non-Banking (PREVENTION, PROHIBITION & Companies (Reserve Bank) Directions, 2016, if REDRESSAL) ACT, 2013 applicable. The following details of sexual harassment cases The said particulars or information should be filed, if any, in the company during the financial year, furnished with reference to the position as on the should be disclosed in the Board’s Report:- last day of the financial year to which the Report • Number of complaints of sexual harassment relates and if the amounts remaining unclaimed received in the year; or undisbursed as referred to above exceed in the • Number of complaints disposed off during the year; aggregate Rs. 5 lakhs, there should also be included • Number of cases pending for more than ninety in the Report a statement on the steps taken or days; proposed to be taken by the Board for the repayment • Number of workshops or awareness programmes of the amounts due to the depositors remaining carried out in connection with sexual harassment unclaimed or undisbursed. • Remedial measures taken by the company.

152 DECEMBER 2016 I CHARTERED SECRETARY 26. ADDITIONAL DISCLOSURES may bear the same date as that of the Auditor’s Report or a later date as authorised by the Board. However, if PURSUANT TO NATIONAL HOUSING the Auditor’s Report is dated subsequent to the date of BANK DIRECTIONS Board’s Report, then the Board’s Report may bear the The Report should include information on: same date or a date after the date of the Auditor’s Report. (a) the total number of accounts of public deposit The following are required to be annexed to the of the housing finance company which have Board’s Report: not been claimed by the depositors or not • Particulars of prescribed contracts / arrangements paid by the housing finance company after with related parties in Form AOC-2. This Form the date on which the deposit became due for shall be signed by the persons who have signed repayment; and the Board’s Report. (b) the total amounts due under such accounts • Prescribed particulars of remuneration of remaining unclaimed or unpaid beyond the Directors and employees due date for repayment. • Secretarial audit report for the relevant financial The said information should be furnished with reference year in Form MR-3 to the position as on the last date of the financial year • Extract of Annual Return in Form MGT-9 to which the Report relates. If the amounts remaining • Annual report on CSR activities. This Report shall unclaimed or undisbursed, as referred to in point be signed by Chief Executive Officer/Managing (b) above, exceed in the aggregate Rs. 5 lakhs, the Director/Director and by the Chairman of CSR Report should also include a statement on the steps Committee. taken or proposed to be taken by the Board for the • Policy relating to remuneration of Directors, Key repayment of the amounts due to the depositors or Managerial Personnel and other employees. group of joint depositors and remaining unclaimed or • Prescribed details of conservation of energy, undisbursed. research and development, technology absorption, foreign exchange earnings and outgo 27. ADDITIONAL DISCLOSURES • Auditors’ certificate on Corporate Governance in PURSUANT TO FEMA case of Listed Companies. REGULATIONS Companies owned or controlled by non-resident 31. COLLECTIVE RESPONSIBILITY OF entities should obtain a certificate from the Statutory THE BOARD Auditors on an annual basis as regards status of 31.1 The Report should be the collective responsibility compliance with the instructions on downstream of all the Directors though the Report may have investment, as provided in Foreign Exchange been approved only by a majority of the Directors. Management (Transfer or Issue of Security by A 31.2 The Board should be collectively responsible for Person Resident Outside India) (Ninth Amendment) any statement in its Report which is materially Regulations, 2013. The fact that Statutory Auditors false or for any omission of a material fact, have certified that the company is in compliance with knowing it to be material. the aforesaid Regulations will be duly mentioned in the Board’s Report of such companies. 32. FILING OF THE BOARD’S REPORT The Report alongwith the audited Financial Statements 28. ADDITIONAL DISCLOSURES BY of the company should be filed with the Registrar of PRODUCER COMPANY Companies within the prescribed time limit. The Board’s Report of a Producer Company shall The resolution passed by the Board approving contain the following disclosures: such Report shall also be filed with the Registrar of (a) Amounts to be paid as limited return on share Companies. capital. (b) Amounts, if any, proposed to be disbursed as 33. CONSISTENCY patronage bonus. The Board should ensure consistency of information given in the Report, the Report on Corporate 29. APPROVAL OF THE REPORT Governance and the explanatory statements to The Report should be considered and approved by resolutions. means of a resolution passed at a duly convened meeting of the Board. The same cannot be approved 34. RIGHT OF MEMBERS TO COPIES by circulation. It shall also not be dealt with in a Board OF REPORT meeting held through video conferencing or other 34.1 A copy of the Report alongwith the Financial audio visual means. Statements and the Auditor’s Report should be sent, either physically or in electronic form, so 30. SIGNING AND DATING OF THE as to reach every Member not less than 21 days REPORT before the date of the annual general meeting. The Report should be signed by the Chairman of the 34.2 The Report should be supplied to each Member of company, if any, authorised in that behalf by the Board, the company. or, by not less than two Directors of the company, one The Report should also be put up on the website of the of whom should be Managing Director, where there is company. Every Non-Banking Financial Company, one. In case the company has only one Director, the Miscellaneous Non-Banking Company and Residuary Report should be signed by the said Director. Company should deliver to the Reserve Bank of India, If the Auditor’s Report is available for consideration at the its audited Financial Statements together with a copy time of approving the Board’s Report, the Board’s Report of the Board’s Report.

CHARTERED SECRETARY I DECEMBER 2016 153 Every Housing Finance Company should deliver (v) Weighted-average exercise prices and weighted-average to the National Housing Bank, its audited Financial fair values of options shall be disclosed separately for Statements together with a copy of the Board’s options whose exercise price either equals or exceeds or is Report. less than the market price of the stock. (vi) Employee wise details (name of employee, designation, EFFECTIVE DATE number of options granted during the year, exercise price) of This Standard is effective from ………………. options granted to - (a) senior managerial personnel; Annexure 1 (b) any other employee who receives a grant in any one year of option amounting to 5% or more of option Disclosures under the SEBI (Share Based Employee granted during that year; and Benefits) Regulations, 2014 (c) identified employees who were granted option, Listed Companies shall make the following disclosures on their during any one year, equal to or exceeding 1% of the website with web link being disclosed in the Board’s Report: issued capital (excluding outstanding warrants and A. Relevant disclosures in terms of the ‘Guidance note on conversions) of the company at the time of grant. accounting for employee share-based payments’ issued (vii) A description of the method and significant assumptions by ICAI or any other relevant accounting standards as used during the year to estimate the fair value of options prescribed from time to time. including the following information: B. Diluted Earnings per Share on issue of shares pursuant (a) the weighted-average values of share price, exercise to all the schemes covered under the regulations shall be price, expected volatility, expected option life, expected disclosed in accordance with ‘Accounting Standard 20 - dividends, the risk-free interest rate and any other inputs Earnings Per Share’ issued by ICAI or any other relevant to the model; accounting standards as prescribed from time to time. (b) the method used and the assumptions made to incorporate the effects of expected early exercise; C. Details related to Employee Stock Options Scheme(ESOS) (c) how expected volatility was determined, including an (i) A description of each ESOS that existed at any time during explanation of the extent to which expected volatility the year, including the general terms and conditions of each was based on historical volatility; and ESOS, including - (d) whether and how any other features of the option grant (a) Date of shareholders’ approval were incorporated into the measurement of fair value, (b) Total number of options approved under ESOS such as a market condition. (c) Vesting requirements Disclosures in respect of grants made in three years prior to (d) Exercise price or pricing formula IPO under each ESOS (e) Maximum term of options granted (i) Until all options granted in the three years prior to the IPO (f) Source of shares (primary, secondary or combination) have been exercised or have lapsed, disclosures of the (g) Variation in terms of options information specified above in respect of such options shall (ii) Method used to account for ESOS - Intrinsic or fair value. also be made. (iii) Where the company opts for expensing of the options using the intrinsic value of the options, the difference between the D. Details related to Employee Stock Purchase Scheme employee compensation cost so computed and the employee (ESPS) compensation cost that shall have been recognized if it (i) The following details on each ESPS under which allotments had used the fair value of the options shall be disclosed. were made during the year: The impact of this difference on profits and on EPS of the (a) Date of shareholders’ approval company shall also be disclosed. (b) Number of shares issued (iv) Option movement during the year (For each ESOS): (c) The price at which such shares are issued (d) Lock-in period Particulars Details (ii) The following details regarding allotment made under each Number of options outstanding at the ESPS, as at the end of the year : beginning of the period Number of options granted during the year Particulars Details Number of options forfeited / lapsed during The details of the number of shares issued the year under ESPS Number of options vested during the year The price at which such shares are issued

Number of options exercised during the year Employee-wise details of the shares issued to; Number of shares arising as a result of (i) senior managerial personnel; exercise of options (ii) any other employee who is issued shares Money realized by exercise of options (INR), in any one year amounting to 5% or more if scheme is implemented directly by the shares issued during that year; company (iii) identified employees who were issued Loan repaid by the Trust during the year from shares during any one year equal to or exercise price received exceeding 1% of the issued capital of the Number of options outstanding at the end of company at the time of issuance; the year Consideration received against the issuance Number of options exercisable at the end of of shares, if scheme is implemented directly the year by the company

154 DECEMBER 2016 I CHARTERED SECRETARY Loan repaid by the Trust during the year from F. Details related to General Employee Benefits Scheme exercise price received (GEBS) / Retirement Benefits Scheme (RBS) (i) A description of each GEBS / RBS scheme that existed E. Details related to Stock Appreciation Rights (SAR) at any time during the year, including the general terms (i) A description of each SAR scheme that existed at any and conditions of each such scheme, including – time during the year, including the general terms and (a) Date of shareholders’ approval conditions of each SAR scheme, including - (b) Kind of benefits to be granted under the scheme (a) Date of shareholders’ approval (c) Beneficiaries of the scheme (b) Total number of shares approved under the SAR (d) Total assets of the scheme scheme (e) Quantum of holding in own shares / listed holding (c) Vesting requirements company shares (both absolute and in percentage) (d) SAR price or pricing formula (f) Whether scheme is in compliance of regulation (e) Maximum term of SAR granted 26(2) / 27(3) of the regulations, as applicable (f) Method of settlement (whether in cash or equity) (g) Variation in terms of scheme (g) Choice of settlement (with the company or the G. Details related to Trust employee or combination) The following details, inter alia, in connection with transactions (h) Source of shares (primary, secondary or made by the Trust meant for the purpose of administering the combination) schemes under the regulations are to be disclosed: (i) Variation in terms of scheme (ii) Method used to account for SAR - Intrinsic or fair value. (i) General information on all schemes Sl. (iii) Where the company opts for expensing of SAR using Particulars Details the intrinsic value of SAR, the difference between the No. employee compensation cost so computed and the 1. Name of the Trust employee compensation cost that shall have been 2. Details of the Trustee(s) recognized if it had used the fair value of SAR, shall be Amount of loan disbursed by company / any disclosed. The impact of this difference on profits and on 3. company in the group, during the year EPS of the company shall also be disclosed. Amount of loan outstanding (repayable to (iv) SAR movement during the year (For each SAR scheme): 4. company / any company in the group) as at the end of the year Amount of loan, if any, taken from any other Particulars Details source for which company / any company Number of SARs outstanding at the beginning 5. in the group has provided any security or of the year guarantee Any other contribution made to the Trust Number of SARs granted during the year 6. during the year Number of SARs forfeited / lapsed during the year (ii) Brief details of transactions in shares by the Trust (a) Number of shares held at the beginning of the year; Number of SARs vested during the year (b) Number of shares acquired during the year through (i) primary Number of SARs exercised / settled during issuance (ii) secondary acquisition, also as a percentage of the year paid up equity capital as at the end of the previous financial Number of SARs outstanding at the end of year, along with information on weighted average cost of the year acquisition per share; (c) Number of shares transferred to the employees / sold along Number of SARs exercisable at the end of with the purpose thereof; the year (d) Number of shares held at the end of the year.

(v) Employee-wise details (name of employee, designation, (iii) In case of secondary acquisition of shares by the Trust number of SAR granted during the year, exercise price) As a percentage of paid-up of SAR granted to - equity capital as at the end (a) senior managerial personnel; of the year immediately Number of shares (b) any other employee who receives a grant in any one preceding the year in which year of amounting to 5% or more of SAR granted shareholders’ approval was during that year; and obtained (c) identified employees who were granted SAR, during Held at the beginning of the year any one year, equal to or exceeding 1% of the issued capital (excluding outstanding warrants and Acquired during the year conversions) of the company at the time of grant. Disclosures in respect of grants made in three years Sold during the year prior to IPO under each SAR scheme Transferred to the employees (i) Until all SARs granted in the three years prior to the IPO during the year have been exercised or have lapsed, disclosures of the information specified above in respect of such SARs Held at the end of the year shall also be made

CHARTERED SECRETARY I DECEMBER 2016 155 Proceedings of 44th National Convention

Opening Plenary God cannot be present in each family. God has created The 44th National Convention of Company Secretaries on the mothers, similarly government has created institutes theme “Powering Governance - Empowering Stakeholders: like ICSI whose members are emerging as governance CS - The Governance Professional”, commenced with a professional in each company. CS can claim to be grand opening at Mahatma Mandir Convention Centre, governance professionals if they are able to balance interest Gandhinagar, Gujarat. of all stakeholders. According to me, institutes of corporate governance are the most important institutes”, concluded Shri Vijaybhai R. Rupani, Hon’ble Chief Minister of Gujarat Dr. Sahoo. graced the occasion as the Chief Guest. While inaugurating the 44th National Convention, he congratulated the ICSI Shri Bimal Kumar Choudhary, MD & CEO, Anmol Biscuits for creating a massive platform to deliberate strategies Ltd., emphasised on the Role of Company Secretaries as and methodologies for powering Governance in order to Governance Professionals who can lead India into becoming empower Stakeholders. a world leader in terms of ease of doing business.

Shri Rupani appreciated the Institute’s initiative in this Shri Mrugank M. Paranjape, MD & CEO, Multi Commodity direction and said, “True empowerment of our country Exchange of India while addressing mentioned that there needs appropriate strategy to embark upon the challenges is a wide range of stakeholders to cater to. This is a huge like poverty alleviation, agricultural reforms, co-operation responsibility and a task that the CS have to hand. between Centre and States, transparency, judicious delivery of services, job creation, development of infrastructure and In her presidential address, CS Mamta Binani, President, setting up of business with ease and convenience etc. In ICSI, said, “The factual empowerment requires realization short, the nation should be directed to empower its stake of real intents of the government’s initiatives through serious holders along with the goal of Self Sufficient and Self Reliant involvement of citizens, focussed industrial development, India”. promoting ease of doing business, endorsement of digital India, innovative technologies and many more. This needs The companies are run by company secretaries and only well structured governance for stakeholders to come when a company runs on rules and regulations, will progress. together with a view to accomplish the consolidated end We all have one role and that is to run our organisations through brightening means”. smoothly. Shri Arun Jaitley, Hon’ble Minister of Finance and Corporate “Power-driven governance is a key to empower the people Affairs and Shri Suresh Prabhakar Prabhu, Hon’ble Union of the nation and the nation as a whole. To attain the goal Minister for Railways and Shri Arjun Ram Meghwal, Hon’ble of powered governance and in turn the stakeholders’ Union Minister of State for Finance and Corporate Affairs empowerment. The reach of such schemes among the through their video message congratulated the ICSI for an remotest masses as well can be made possible through enormous effort in advocating the cause of good Corporate professionally enabled channels”, she added. C onvention P roceedings of 44 th N ational Governance. They addressed the august gathering through aired message. “Globally, services afforded under the expertise of professionals and alike have been the greatest enabler in CS (Dr.) M.S. Sahoo, Chairman, The Insolvency and causing remarkable positive transformation. India’s story is Bankruptcy Board of India also addressed the gathering of not different, and the utilisation of professional resources eminent professionals and said that, “Company Secretaries in the form of Company Secretaries and others have been have a pivotal role to play in areas of Insolvency and seen as a game-changer”, she reiterated. Bankruptcy”. Taking the concept of unbiased approach towards stakeholders, Dr. M. S. Sahoo, said that there is Company Secretaries play a pivotal role in multi-faced a need to have an unbiased approach which is not easy to functional dynamics. Their encompassing role in the varied maintain. “It is not possible for the government to keep a areas like corporate governance, compliance management tab on every activity of the number of companies and there of laws including Company Law, Competition law, Bankruptcy comes the role of the CS. The CS are the professionals to and Insolvency Law, Goods and Services Tax etc. are whom this work has been delegated. CS are the governance contributing towards empowering stakeholders. Indeed, professionals of the Government in each and every Company Secretaries have the necessary competence institution,” added Dr. Sahoo. to handle all issues concerning governance and ensuring compliances. A facilitator of legal compliance, Company “Government cannot be present inside each company like Secretaries can enable all citizens to reap the benefits of

156 DECEMBER 2016 I CHARTERED SECRETARY government’s schemes and initiatives in more effective impact of initiatives like ‘Make in India’, ‘Digital India’ and and efficient manner. It will be apt to state that the role of ‘Demonetisation’ on economy and people. The session entire professional community is more crucial and decisive was chaired by Dr. Ravindra H. Dholakia, Professor, in ensuring ‘Powering Governance along with Empowering IIM- Ahmedabad and the guest speakers comprising Shri Stakeholders,’ she further explained. Devesh Bansal, Director, Skipper India Ltd, Shri John E Matheson, Managing Partner, IP Policy Services LLP, Shri CS (Dr.) Shyam Agrawal, Vice President, ICSI introduced Joy Saxena, Executive Director, Vikram Solar Pvt. Ltd, Shri the theme of 44th National Convention and said, “Globally, Saurabh Soparkar, Senior Advocate, Gujarat High Court, services afforded under the expertise of professionals and Shri Yamal A Vyas, Shri S. K. Agrawala and CS Makarand alike have been the greatest enabler in causing remarkable M Lele, Central Council Members of Institute of Company positive transformation. India’s story is not different, and the Secretaries of India (ICSI). utilisation of professional resources in the form of Company Secretaries and others have been seen as a game-changer”. Dr. Ravindra H. Dholakia spoke about how India is going through a turnaround phase and laid the emphasis on role He said, as a professional, we should be unbiased to all of professionals during this period. “From 2007 to 2016, our stakeholders and develop the ability to work with integrity. growth rate has been around 7% and we have not been We must have the power of decisive leadership. The theme able to accelerate which is our major failure. Now we are of this convention - Powering Governance & Empowering seeing the environment of fast change and fast reforms. It Stakeholders -- is apt as our role is that of governance is in these times, the role of professionals is of significance professional. He further quoted PM Narendra Modi, -- as corporate governance is going to take front seat,” added “Putting people at the centre of development process is Dr. Dholakia. called good governance.” In his address, Shri Devesh Bansal spoke on how recruiting CS Ashish C. Doshi, Council Member, ICSI and Chairman, professionals for particular jobs has led to evolution in many 44th National Convention Organising Sub-Committee said MSMEs and small businesses. “Looking at 2022, we look that Company Secretaries are the professionals to guide the forward to companies which are built on processes and channelization of all Government initiatives in right direction professionalism. A strong company secretary vertical can with their competencies in Corporate Governance, Due not only do statutory compliance but also bring in corporate Diligence and Legal Compliance. With the tint of proficiency governance,” said Bansal. of the company secretaries in taking forward these initiatives, the day is not far when these opportunities will Shri John E Matheson congratulated Prime Minister Narendra make significant improvements in the direction of inclusive Modi on taking the bold step of demonetisation in the face of India with exclusive growth. corruption. “This sends a very strong message that there is a complete no nonsense approach towards corruption,” said CS Ashish Garg, Council Member, ICSI and CS Tushar Matheson. Talking about his experiences of collaboration in Shah, Chairman, Ahmedabad Chapter of ICSI and CS India, Matheson said that if a foreign investor wants to be Prakash K. Pandya, Vice Chairman, WIRC of the ICSI were successful in India, it has to understand how the system works. also present. Shri Matheson concluded by saying that CS professionals should embrace technology and step-up and lead. C onvention P roceedings of 44 th N ational CS Dinesh C. Arora, Secretary, ICSI delivered the formal vote of thanks. While delivering vote of thanks, he informed Shri Joy Saxena also hailed the demonetisation move by the participants that, as an important initiative to profess and government and said that it will lead to higher growth in next create international consensus for “International Corporate 2-3 years, GST rates will fall and the fiscal deficit will come Governance Day” there is a necessity to bring all the down. nations together under one platform. Hence, the Institute is hosting 1st Global Congruence to promulgate International Shri Saurabh Soparkar, Senior Advocate, Gujarat High Corporate Governance Day on December 8-9, 2016 at Court also threw light on the subject with his vast experience Hyderabad International Convention Centre (HICC) in the and knowledge. pearl city of Hyderabad. He urged delegates to register and participate in the event. The first technical session also saw release of two books- ‘SEBI (LODR) Regulations, 2015 and Companies Act, First Technical Session- ‘Looking Glass to 2022- India 2013’and ‘Guide to Transfer Pricing’. at 75- Role of Professionals’ The first technical session was on the topic ‘Looking A B2B Session was organised after the technical session. Glass to 2022- India at 75- Role of Professionals’. The The day ended with Cultural programme which was graced session focused on the opportunities and expectations by Mr. Bhumik Shah, Singer and Star cast of Guajarati from professionals in India in the coming years and the Movie “Passport”

CHARTERED SECRETARY I DECEMBER 2016 157 DAY-2 the element of extreme uncertainty, we plan years. This The day started with yoga session at Sabarmati River front is the root cause of all the mental anxiousness that most in association with Ministry of Ayush, Government of India. people are plagued with. The yoga session was conducted by Ms. Sangeeta Thawani, Chief Yoga Trainer, Sivananda Ashram at Sabarmati River Thus, the third secret – Every cloud has a silver lining. The Front, Ahmedabad. third secret is of perspective, how we look at situations and believe that something better is there in store, waiting Special Session- Towards Meaningful Life to unleash at the right moment. Towards the end of the Gaur Gopal Das in a very mesmerizing session – “Towards session, Swami ji asked all to be content with what we have Meaningful Life” shared secrets to have a quality life. and make that better rather than cribbing over what isn’t Beginning with a simple explanation that Life is a journey there. from B to D, i.e., from Birth to Death . In between this journey Responding to questions from the audience, Swami ji there is C- the C of choice. explained how he became a monk not because something someday happened but because he responded to his calling. It is very important to make the right choice to have a quality The calling within that told him he wanted to contribute life. Sharing a number of stories from the real lives of people towards the, world better and more, which was not possible and the Holy Scriptures, he told the audience about three with the liabilities of normal social life. Towards the end of secrets of life that will help make right choices. the session, he affirmed his belief on a life after death and appealed to all present to rise above the trivialities and focus The first secret he shared is “Don’t just go through life, on the three secrets – the keys to have a meaningful life and Grow through life”. Explaining this first secret Swami ji not just another life. insisted on having a purpose in life. He said “People, who are consumed by purpose, do not have time for trivialities. CS Atul H. Mehta and CS Satwinder Singh were also present Purpose helps us rise above the trivialities, situations, at the dais during the session. happenings in life that are beyond our control.”Mocking at the materialistic insight of the people today, Swami ji said Technical Session- 2- ‘CEOs Speak-Emulate Governance that people just focus on what the others see. “People buy from Corporate Leaders’ what they don’t need; with the money they don’t have and to show to people who anyways they hate ”, he added further The panel discussion on ‘CEOs Speak-Emulate explaining that if you focus on what is seen by the world, Governance from Corporate Leaders’ on the second day you end up in stressful situations as the external growth is of 44th National Convention focused on the needs and impact not in proportions to the internal growth. Any individual is of corporate governance and role of company secretaries in facing nervous breakdown and stressful situation, he or she it. The panel discussion was moderated by Shri Ashok Barat, has not grown internally. It is exactly how if a body builder Chief Operating Officer, Cyril Amarchand Mangaldas, Law focuses only on the upper part of the body and neglects the Firm and guest panelists comprised of Shri Uday Khanna, lower part; there is a possibility of a number of health issues Chairman, Bata India Ltd and Shri Sunil Mathur, Managing like slip disc and others. Thus, to have a meaningful quality Director and Chief Executive Officer, Siemens India Ltd. CS life balance is very important.“ Choose to grow internally as Ranjeet K Pandey and CS V Ahalada Rao, Central Council well as externally to have a sustainable life,” he explained. Members of Institute of Company Secretaries of India (ICSI) C onvention P roceedings of 44 th N ational Questioning the audience as to why do we cry over the were also present during the panel discussion. same issue if we cannot laugh at the same joke again and again, he highlighted how we focus on what we can’t rather Shri Ashok Barat kicked off the panel discussion by defining than what we can .In this context, he explained how people corporate governance which is true for any corporate like misuse the most powerful asset, the best gift of God – the trust, society, co-operative etc. “Corporate governance gift of free will, the gift of choice. has come to be defined as compliance but it is much more than that. I define corporate governance as doing the right Situations are not in our control but the response to it is thing, right way and being seen doing it so,” said Shri Barat. definitely under our control.“Do not react to situations, He explained that corporate governance is more than just respond to situations, ” saying this he put forth his second compliance. Compliance is just external manifestation, like secret to a meaningful life – Don’t try to prove, try to a thermometer to measure fitness. Corporate Governance improve. “Comparison is a horrible disease where we try to must ensure that, all stakeholders must feel that they have prove ourselves. Why not work on ourselves and give our been fairly treated. He said that corporate governance 200 per cent. Prove, but based on your potential and not to is a good infection to have, and spread. If organisation is impress under performance pressure,” said Swami ji. Now, governed well, it spreads to others in the eco system and Swami ji moved to the third secret through the word PLAN. all concerned including vendors, employees and others are Taking the perspective of how people react when plans do governed well. Lastly, he said that CG is responsibility of all not pan out the way they should, he explained that despite and not just the top management.

158 DECEMBER 2016 I CHARTERED SECRETARY In his address, Shri Uday Khanna talked about how 520 million smart phone users by 2020 and close to $500 good governance and good ethics is not just good for billion payments will flow electronically by 2020. Dynamic the organization, but is good for the country and all social media changes are changing relationships. As per the individuals.“If companies are governed well, it creates loyal predictions, there would be as many as 200 billion apps by customers. Good governance attracts better employees 2020. Tracing history we find that it took 38 years for radio which in turn results in better productivity. Also well to percolate down social threads and 14 years for television governed companies grow better than competitors. And but if we look at the recent past, iphones did it in 3 years, overall it is good for country,” said Shri Khanna. CS must Instagram in two years and the game Angry bird reached grow from just legal compliance and must ensure training millions in just 35 days. So from decades it has become and moulding the culture of company. He also advised the days. To be able to keep up with this fast paced growth, the present professionals in audience on important qualities of CS also need to be updated. Aim towards a paperless office, leadership.“There’s a saying in Rig Veda, let good thoughts be more connected through technology. come from every side. When this happens, corporate governance will be reality,” concluded Shri Khanna. “The recent changes in digitization are changing business and therefore, to maintain the new development in the Shri Sunil Mathur took up a case study of Siemens, as to technological tsunami, the ways have to be change how 4 managers of the company were booked for cartel ”explained CS Pavan Kumar Vijay, Managing Director, activity, which resulted in serious introspection by the Corporate Professionals Capital Pvt Ltd & Past President, company in form of in house investigation which ended up in ICSI. CS Vijay in his futuristic presentation, claimed that setting up of standard system and procedures to ensure that 80% of the present CS work which is procedural in nature decisions are taken based on greater good and not based would be taken away by Technology in the form of Artificial on preference of mangers with no standard processes. He Intelligence. He urged the professionals to be future ready spoke on how his company overcame a systemic collapse. by increasing their productivity with use of technology. He said that the systemic failure happened because of lack He also predicted that technology and market dynamics of corporate governance.“Corporate governance is now a will force merger of existing professions. He gave out the necessity; companies can get closed down if they are not success mantra as “Knowing is not enough, you must apply. governed well. It is up to the company secretaries to keep Willing is not enough, do it. Don’t be afraid of change, it the companies straight and narrow,” added Shri Mathur. leads to new beginning.”

Technical Session- 3- Digital Drive- Empowering Mr. Apurva Mehta, Commercial Attorney, Microsoft India Ltd Knowledge Economy briefed the participants about the SMAC – The New Trends in Technology & the evolving role of Compliance, Data In the wake of India being in the cusp of a digital revolution, Privacy and Risk professionals. the role of the company secretaries (CS) has gained immense criticality. It is one profession through which one CS Mahavir Lunawat and CS Ramasubramaniam C. Central can contribute more towards the society than any other Council Members ICSI graced the occasion with their profession. This upcoming dynamism in the role of the CS presence at the dais during the session. was well explained in the words of Shri Rajesh Sharma, Council Member (Government Nominee), ICSI. He said: Technical Session- 4-Learning from the Experience of C onvention P roceedings of 44 th N ational “The CS are the closest to the whole hierarchy of the top Royal Majesties management. We are the key managerial persons amongst CS Mamta Binani, President ICSI introduced the the board of directors. We sense for the corporate structure guest speaker Maharao Raghubir SInghji Bahadur, and therefore we are very important.” Sirohi,Rajasthan. Maharao ji took the audience on a time Dynamics of the business are changing very fast. It is a travel and shared his experiences and memories. He gave complete consumer driven economy where consumer the message that there is lot to learn from our own history. is the king. Talking on these lines, Shri Pramod Mulani – Head, Product and Digital Initiative Division, NSDCL, talked The day ended with colourful cultural evening with about the 4 traits of technology. Efficiency, Effectiveness, performance of Gujarati folk dance ‘Panghat’and cast of Contextuality and Entertainment. He talked how technology Comedy Factory. The event was graced by the presence of has empowered customers. Now customers mantra is “ I Ms. Ameesha Patel, Bollywood Actress. want what I want when I want, where I want and so on...”. Digital payments have further empowered customers. Day- 3 Run for the Cause This is a unique profession, said Shri Paroon Chadha, Co- The day started with Run for the cause of CSBF in association founder & CEO of Passageways. CS is a profession that fuels with Ministry of Ayush, Government of India. Guest of the journey of this digital transformation. A transformation Honour for the event was Shri Gautambhai Navalchand that when converted to numbers reflects that there will be Shah, Mayor, Ahmedabad Municipal Corporation.

CHARTERED SECRETARY I DECEMBER 2016 159 Interactive Session the nation, they are those professionals who protect the CS Mamta Binani, President ICSI informed about the interest of the average shareholders and therefore are the developments made by the institute. She asked the members Saarthis of Indian Businesses, mentioned by Hon’ble Union to interact with students who come to them for training for Minister for Textiles, Mrs. Smirti Zubin Irani in her address. survival in the ruthless corporate sector. She informed that Applauding the CS fraternity, Ms Irani said, “These CS are centre of excellence in Hyderabad would be coming up very those who hold up the banner of law in a business set up soon and the Kolkata centre is expected to be coming up that entirely sustains on the profit-making model. While all within two years. focus on money, it is the CS who wave off the flag to draw attention towards the compliances.” Speaking on the role Many members interacted with the council during the of the CS in developing the economy, the minister said that session. Suggestion was made that the syllabus of CS Legacy of Indian Business is entwined with Philanthropy. course should focus on core areas and that quality should As per the modern concept of Philanthropy, it gives an be emphasised rather than quantity while drafting the opportunity to serve the needy. India is now an emerged syllabus. The concern relating to new members was raised, nation and thus comes the responsibility. We cannot afford and it was felt that there is a need for a forum for CS in to be a “Jugaad Economy” and here comes the role of a CS. employment where their concerns could be addressed. “You have the power to change the small stories of women CS Pavan Vijay stated that the institute should have a vision and men in remotest areas of the nation to achieve their best plan and the institute should work towards becoming a potentials”. visionary oriented institution. He also highlighted the need for investing in digital infrastructure by the institute. Sharing views on the same lines, Shri Vinai Kumar Saxena, Chairman, Khadi and Village Industries Commission said During the interaction, the president candidly answered as artisans are the backbone of khadi industry, CS are the the queries of members and noted the various suggestions backbone of Indian Businesses. Khadi is an industry where made. hand holding is done in the true sense and now is the time for the CS to help companies to hold hands of the khadi Technical Session 5- Enhancing Skills- Finding the Way businesses and help them achieve their true potentials. beyond Compliance “The mood of the country is right and the industry that had been neglected for last two decades is now come into the The guest speaker, Dr. P. D. Vaghela, Commissioner, mainstream,” said Saxena appealing to the nation to buy at Commissionerate of Commercial Tax, Gujarat talked least one khadi cloth every year to make a difference in the about GST legislation in detail and invited the Company lives of those artisans who are weaving the cloth in one of Secretaries to practice in the area of GST. our villages.

CS (Dr.) U.K. Choudhary, Senior Advocate, Supreme Taking pride in the fact that of the 75,000 Company Court of India & Past President ICSI, spoke about the skills Secretaries across the globe, 50,000 are from India and of to acquire. He emphasised that Compliance should be these 50,000, 50 per cent are women, Ms Irani reminded ensured in both letter and spirit. Noting the recent changes of the potentials of the Indian CS. She said that with the in regulatory environment, he spoke about the huge scope strength, another important part is the timing. The speed of of representative services before NCLT and NCALT. He governance is equally important. “As this Mahatma Mandir C onvention P roceedings of 44 th N ational also spoke about the skills for presenting effectively. In – the biggest convention centre of the country was built in representative capacity the professional should keep himself just 9 months; our ventures should also be time bound”. emotionally detached from the client, the professional Towards the end, the Union Minister put forth three appeals must maintain balance equilibrium between duty to client to the ICSI and the CS fraternity. First, to help those who and duty to court. He also focused on the opportunities do not understand their potential and help them optimize available under the Bankruptcy code of India and advised their economic potential. Second, we have a vision to look the professionals to register themselves as Insolvency at corporate Governance at 75. Document what India will be Professionals. He concluded by saying that the professional in terms of business in next 5 to 15 years down the line. The should always strive to become a good human being first third, she requested that the ICSI to prepare a document and that the strength of character is the biggest strength. on what the corporate government looks like the face of corporate governance at 75.This will work as a visionary Shri Gopal Krishna Agarwal (Government Nominee), Shri document or a roadmap to help achieve these visions. She Vijay Kumar Jhalani (Government Nominee), CS Vineet K. also advised the institute to bring forward the stories of CS Chaudhary and CS Rajiv Bajaj Central Council Members, who started from the scratch and now are stalwarts. The ICSI were also present at the Dias. convention concluded on a positive and enthusiastic note to propel the Indian economy from emerged to developed. Closing Plenary Company secretaries are the conscience keepers of During the session, Best Regional Council and Chapter

160 DECEMBER 2016 I CHARTERED SECRETARY awards for the year 2015 was declared and presented Handbook on Arbitration, Conciliation and Mediation through the gracious hands of Smt. Smriti Zubin Irani, Independent Directors – A Handbook Hon’ble Union Minister of Textiles as under: 7. Risk Management: A Tool for Good Corporate 8. Governance 1. Best Regional Council Award was presented to Northern 9. SEBI (LODR) Regulations, 2015 and Companies Act, India Regional Council of the ICSI 2013: A Comparison 2. Category wise Best Chapter Award were presented as 10. Technical Analysis under: ICSI Premier on Company Law 11. Sl. No. Category Name of the Chapter CS Saathi 12. 1. National Best Chapter Hyderabad 13. 2. Grade A + Hyderabad The release of E- Book on Companies Act, 2013 and 3. Grade A Indore Compliance Audit Configurator (CAC) for Secretarial Audit 4. Grade B Nagpur were arranged by CS Vineet K. Chaudhary, Council Member, 5. Grade C Bhubaneswar ICSI and Chairman, Corporate Laws and Governance during 6. Grade D Visakhapatnam the convention. The e-book seamlessly incorporates all the Sections, rules, notifications and circulars at one place, List of Publications released during the Convention is as making it most user friendly to go through the provisions of follows:- the Company law. The release of Publication ICSI Premier Challenging Opportunities for Practicing Company on Company Law was arranged by CS Ahalada Rao V., Secretaries in Labour Laws Council Member ICSI and Chairman, Research Committee. 1. Corporate Governance Certification Under Listing CS Mamta Binani, President, CS (Dr.) Shyam Agrawal, Regulations: A Referencer Vice President, CS Ashish Doshi, Council Member & 2. Cyber Crime: Law & Practices Chairman Convention Organising Sub-Committee and CS Delisting of Equity Shares: Law and Practice Ashish Garg, Council Member & Co-Chairman Convention 3. E-learning Module on Banking Terminology Organising Sub-Committee were present at the Dias during 4. Guide to Transfer Pricing the closing plenary. The convention ended with a hearty 5. Vote of Thanks by CS Dinesh C. Arora, Secretary ICSI. 6. C onvention P roceedings of 44 th N ational

CHARTERED SECRETARY I DECEMBER 2016 161 CORPORATE GOVERNANCE CORNER

Developments –November 2016 on the governing body (e.g. the board in companies) to King IV report on corporate governance released, attain the governance outcomes of an ethical culture, South Africa good performance and effective control within the The King Committee on Corporate Governance in organisation and legitimacy with stakeholders. South Africa and the Institute of Directors in Southern Africa (IoDSA) released the King IV report on corporate • King IV aims to reduce the ‘tick box’ or compliance CG C orner governance (King IV) on 1 November 2016. approach to applying governance practices.

Hailed as the first outcomes-based governance code in the • King IV requires an “Apply AND Explain” approach to world and modelled on the International Integrated Reporting disclosure, as opposed to King III which was ‘Apply or Framework, King IV reduces the 75 principles contained in Explain’. This means that application of the principles King III to 16 and has an additional 17th principle applicable is assumed and that an explanation is disclosed on the to institutional investors. practices that have been implemented and how these support achieving the associated governance principle. King IV will come into effect for organisations whose The governing body can choose where and how to financial years start on or after 1 April 2017, which means make its King IV disclosures which should be publically those with a year-end of 31 March 2018 will be the first to accessible. Use of cross-referencing between reports is report under the new Code. encouraged to avoid duplication.

King IV builds on the foundations of King III as far as the • King IV is more succinct than King III. It contains 16 content goes, but it introduces extensive innovations principles applicable to all organisations, and a 17th in the area of implementation. Professor Mervyn King principle applicable to institutional investors. Against the Chairperson of the King Committee in South Africa says that 16 principles there are 208 recommended practices, and the overarching objective of King IV is to make corporate for the 17th principle applicable to institutional investors governance more accessible and relevant to a wider range there are an additional 6 recommended practices. of organisations and to be the catalyst for a shift from a compliance-based mindset to one that sees corporate • King IV also provides ‘sector’ supplements to guide governance as a lever for value creation. different types of organisations on how to apply the King IV Code within their contexts. There are five King IV has been revised to bring it up to date with sector supplements covering — Municipalities — Non- international governance codes and best practice; to align Profit Organisations — Retirement Funds — Small it to shifts in the approach to capitalism (towards inclusive, and Medium Enterprises — State-owned Entities The integrated thinking across the six capitals) and to take sector supplements provide terminology in the context account of specific corporate governance developments in of King IV (e.g. how certain definitions are translated relation to effective governing bodies, increased compliance into a particular environment) and guidance on the requirements, new governance structures (e.g. Social interpretation of specific principles considered most and Ethics Committee), emerging risks and opportunities relevant, and possibly challenging, to the sector from new technologies and new reporting and disclosure requirements e.g. Integrated Reporting. For details, please visit- http://www.internationalaccountingbulletin.com/news/king- Applicability of King IV iv-report-on-corporate-governance-released-5654840/ King IV is structured as a Report that includes a Code, with For full report, please visit- additional, separate sector supplements for SME’s, NPO’s, https://www.michalsons.com/wp-content/uploads/2016/11/ State-Owned Entities, Municipalities and Retirement Funds. King_IV_Report_Final.pdf The King Code contains both principles and recommended Remember!! practices aimed at achieving governance outcomes. Whilst 9 December - International Anti-Corruption Day King IV is voluntary (unless prescribed by law or a stock 10 December- Human Rights Day exchange Listings Requirement) it is envisaged that it will be applicable to all organisations irrespective of their form or Feedback & Suggestions manner of incorporation. The King Code principles of good governance are presumed to apply, whilst the practices Readers may give their feedback and suggestions on this should be applied on a ‘proportionality’ basis depending on page to Ms. Banu Dandona, Joint Director, ICSI (banu. the nature, size and complexity of the organization. [email protected])

There are several differences between King III and King IV, Disclaimer: specifically but not exhaustively they are;- The contents under ‘Corporate Governance Corner’ have been collated from different sources. Readers are advised • King IV is outcomes oriented. It places accountability to cross check from original sources.

162 DECEMBER 2016 I CHARTERED SECRETARY