SEBI to delist 4,200 firms; warns erring promoters, auditors

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Capital markets regulator Securities and Exchange Board of India (SEBI) is planning to take a number of steps to deepen it, including forcing thousands of non- or poorly-traded companies to delist and introducing more trading instruments, especially in the commodity space.

These were among some of the steps it outlined with a meeting with senior editors today.
The news would come as relief to investors, whose monies are stuck in companies where no trading takes place.
SEBI chief UK Sinha said the regulator plans to force promoters of companies whose shares do not see active trading both at the main bourses and in regional exchanges to delist.
Such promoters will have to provide an exit route to investors, failing which they will be penalised.
India has about 8,000 listed companies but active trading hardly takes place beyond the top 1,000. As many as 1,200 companies have been suspended for trading for over seven years now, and these will be the first that will be forced to delist.
Besides, there are over 3,000 companies listed on various regional stock exchanges that have become defunct, Sinha said.
The exercise for over 4,200 listed firms would be completed this year. Such exercises would be taken up going forward to clean up the market from what the SEBI chief described as “a source of nuisance”.
He also warned of strong action against the auditors who close their eyes to the lapses in the financial accounts of listed firms.
“So far, we have had a hands-off approach on auditors, but we will take action if something serious comes to our notice. Auditors cannot go scot-free if they have been certifying the books for years without pointing finger at the lapses,” Sinha said.
SEBI also plans to launch more instruments, such as options contracts, in the commodity markets, and will also introduce more commodities for trading.
Sinha also discussed steps that the regulator has taken to ease entry for foreign investors in India, saying that easier FPI registration rules have paid off.
“The number of registered FPIs increased to 8,721 from 4,580 in 2014,” he said.
He also said costs of mutual fund and insurance products in India need to come down and said the regulator had invited former UIDAI chief Nandan Nilekani to advise it on creation of tech platforms for sale and purchase of mutual funds.
“We are also looking to tweak listing rules for startups,” he said.

EU seeks to make it easier to buy online from other countries

by | posted in: Corporate Updates, Cross Border Transactions, M&As, Joint Ventures, Economy, Business Updates, Corporate Affairs, India & International - Corporate updates | 0
An eBay sign is seen at an office building in San Jose, California May 28, 2014.

Online retailers would be banned from stopping a customer in one EU country buying from a website based in another, under a proposal issued on Wednesday to make it easier for consumers to shop across the bloc.

The European Commission said its law would stop “geoblocking” where companies limit access to their websites based on user location, often forcing customers to use versions based in their own country, sometimes with higher prices.

“In the online world, all too often consumers are blocked from accessing offers in other countries,” the Commission said in a statement.

“Such discrimination has no place in the single market.”

The law would affect companies such as Amazon, eBay and Zalando as well as to sales of services provided in a specific location, for example car rental, accommodation and concert tickets.

It would not initially apply to copyright-protected items such as e-books, music and games, although those might be included soon, the Commission said. So for the time being a German citizen would still be unable to buy a Spotify subscription in, for example, Estonia, where it is much cheaper.

The music industry welcomed the exemption, saying that to include such services in the geoblocking proposal would be “a serious blow for cultural diversity.”

Under Wednesday’s proposal, which requires the approval of the European Parliament and national governments to become law, retailers would not be allowed to block access to websites based on a user’s location or to re-route customers to a website version based in their own country without their consent.

Amazon already makes its websites accessible to customers anywhere in Europe, and says 98 percent of its own stock is available to shoppers from any European country.

While e-commerce websites will not be allowed to prevent customers in one EU country buying products in another, they will not be forced to deliver cross-border.

Therefore, an Italian buying a TV from a German website would either have to arrange their own delivery or collect it at the trader’s premises.

The Commission hopes the new rules will increase the proportion of consumers who buy online from another country, currently only 15 percent.

“The European Commission is doing the right thing by helping solve practical problems faced by online businesses, particularly small and medium sized businesses,” said eBay’s’ Paul Todd, Senior Vice President of EMEA (Europe, Middle East and Africa).

A business group said the proposal failed to address the reasons companies use geoblocking, such as differing VAT rates and consumer protection rules.

“This is like putting a sticking plaster on a broken leg,” said John Higgins, director general of DIGITALEUROPE, which represents companies such as Sony, Google and Dropbox.

In a separate proposal, the EU executive sought to increase the transparency of prices for cross-border parcel delivery and to give national authorities the power to assess whether they are affordable.

Source: http://www.reuters.com/article/us-eu-ecommerce-geoblocking-idUSKCN0YG1DC

RBI starts meeting major players in P2P lending

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After releasing a consultation paper on peer-to-peer (P2P) lending last week, Reserve Bank of India (RBI) has started meeting some leading players in the sector. The founder of a leading P2P lending platform, who met officials of RBI’s Department of Non-Banking Regulation on Wednesday, told FE on the condition of anonymity that the central bank is gearing up to come out with final guidelines for P2P lending platforms by the end of the current calendar year.

He also said that money laundering and interest rate are two of the main areas that the RBI is focusing on while framing the final guidelines for the sector. “It seems RBI is keen on capping the rate interest that a P2P lender can charge at the same level as that for non- banking finance company micro finance institutions (NBFC MFIs),” he said.

As per current RBI regulations, the maximum rate of interest that an NBFC MFI can charge is the lower of 10% more than its cost of funds and 2.75 times of the base rate of the top five commercial banks.

“While money laundering shouldn’t have been a big concern, given that draft guidelines have mandated that all transfer of funds happen directly from the lender’s bank account to that of the borrower, the unearthing of a few ponzi schemes in the P2P sector in China seem to have made the RBI more cautious,” the P2P lending platform’s founder added.

Post May 31, which is the deadline set by RBI for suggestions and comments on the regulations, it will work on the final guidelines and seems keen on releasing them by the end of the year, he added.

According to P2P Finance Association, the global P2P market almost doubled last year and has crossed the £5 billion mark.

“Although nascent in India and not significant in value yet, the potential benefits that P2P lending promises to various stakeholders and its associated risks to the financial system are too important to be ignored. The Reserve Bank has therefore found it necessary to put out this discussion paper to elicit public opinion and views of the various stakeholders on the future course of action having regard to the current legal and regulatory framework in place to regulate the business of financial intermediation,” RBI noted in the consultation paper.

It has also proposed a minimum capital requirement of R2 crore for P2P NBFCs and is intent on restricting such entities to just companies, thereby barring proprietorships, partnerships and LLPs.

Source: http://www.financialexpress.com/article/industry/banking-finance/rbi-starts-meeting-major-players-in-p2p-lending/248758/

Sumitomo likely to acquire 44% stake in Excel Crop Care

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Japanese conglomerate Sumitomo is at an advanced stage of negotiations to acquire a substantial equity stake in Excel Crop CareBSE -0.87 % , a Mumbai-headquartered listed company. The proposed deal could pave the way for the Japanese group to own about 44% shares of the pesticides and agrochemicals company for a total consideration ofRs 1,200-1,300 crore.

Sumitomo plans to buy out stake of Excel promoters — the Shroff family — holding 24.7% equity as well as two financial investors together owning close to 19% of the shares. ET’s email to Dipesh Shroff, managing director of Excel Crop Care, and Sumitomo Chemical went unanswered.

There have been several rounds of talks between officials of Sumitomo Chemical and the Excel management, and indications are that the deal may be signed in June. Nufarm, the Australian crop protection and specialist seeds company, owns more than 14% and is likely to retain its strategic stake in Excel Crop Care.

According to a report by Avendus Capital, global players are looking at India to increase their market share, add to their product portfolio , and strengthen their supply base in specialty and agrochemicals. “The Indian agrochemicals market is expected to grow rapidly (about 12% CAGR over 2014-19) with increase in farmer awareness, improvement in rural income and increase in pressure for improving productivity,” said Preet Mohan Singh, executive director, Avendus Capital.

The Shroffs are also the promoters of Excel Industries, a specialty chemicals company, and co-promoters of Aimco Pesticides in which they control a little over 25%. Before entering into any agreement with Sumitomo, the Shroffs are expected to conclude the inter se transfer of their holding to the other promoter family of Aimco. Excel Crop Care has 1.13% equity interest in Excel Industries.

Besides Shroffs, the other two shareholders of Excel Crop Care who may sell their shares to Sumitomo are Ratnabali Capital Markets (holding 14.99%) and Ratnabali Investments (3.95%). Among the institutional shareholders of Excel Crop Care are Life Insurance Corporation (6.58%) and DSP Blackrock (1.92%).

Excel Crop Care’s consolidated net profit for the quarter ended March 31, 2016 was Rs 7.6 crore as against Rs 1.7 crore in the year ago period, on total income of Rs 188.6 crore (Rs 205.6 crore). The Excel Crop Care stock has been trading at around Rs 1,109, against 52-week high and low of Rs 1,247 and Rs 750, respectively.

M&A activities in sectors like agro and specialty chemicals is expected to pick up, said Avendus, adding that the stride towards food security will also increase the significance of agrochemicals. An estimated 85% of India’s crop loss (worth close to $20 billion) is caused by pest infestation, disease and weeds and is prevented by the use of agrochemicals.

India exports agrochemicals to countries like the us , France, the Netherlands, Belgium, Germany, Brazil, Colombia, China, Vietnam and Indonesia.

Source: http://economictimes.indiatimes.com/articleshow/52392474.cms

Tax grievances: IT dept launches ‘e-nivaran’ for speedy grievance redressal

by | posted in: Corporate Updates, Income Tax,e-Filing- Individuals, Firms, Companies | 0

CBDTThe Income Tax department has launched a special electronic grievance redressal system called ‘e-nivaran’ in order to fast track taxpayer grievances and ensure early resolution of their complaints.

A separate and dedicated window for grievance redressal has been launched recently in the Income Tax Business Application (ITBA), the new smart electronic platform for the regular operations of the department.

The facility is called ‘e-nivaran’ (electronic solution) and acts to integrate all online and physical complaints gathered by the department at this platform which will be monitored by the Assessing Officer of the case upto the supervisory officers in a paperless environment.

The facility is called ‘e-nivaran’ (electronic solution) and acts to integrate all online and physical complaints gathered by the department at this platform which will be monitored by the Assessing Officer of the case up to the supervisory officers in a paperless environment.

“The new system is called unified grievance management system and is acronymed ‘e-nivaran’. The system not only records the origin of the grievance on the electronic platform it works on, but it also keeps tracking it till it reaches its logical conclusion for final resolution,” a senior IT official said.

The e-portal will also ensure that grievances related to any section or domain of the tax department are transferred quickly to the department concerned like that of refunds issue or any other IT matter concerning an assessee.

The decision to launch ‘e-nivaran’, the official said, was taken in view of Prime Minister Narendra Modi few months back asking the IT department to pull up its socks and ensure that taxpayers grievances are resolved in the shortest possible time.

Modi had also asked all such departments which have a public interface to reduce this time to one month from the existing two months time.

The Central Board of Direct Taxes (CBDT), the policy-making body of the department, has recently also created a new structure in the department to deal with these issues called the Taxpayer Services unit.

Allotting high priority to this issue, the CBDT had also brought a new mechanism where top officers of the department have been allotted a specific quota of complaints to monitor and track, from their origin to successful resolution.

Source: http://indianexpress.com/article/business/business-others/tax-grievances-it-dept-to-ensure-e-nivaran-2805360/

India moots framework for SME sector cooperation in BRICS

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India is working on a mechanism to boost cooperation amongst small and medium enterprises in the five-nation BRICS to promote joint ventures and share expertise on strengthening the sector.

New Delhi, which holds the Presidency of the BRICS this year, is drafting a framework for a joint growth strategy for micro, small and medium enterprises (MSMEs) in the region. “The framework for cooperation amongst MSMEs, which will identify the relative strengths of each country and also possible areas of joint ventures, will be discussed at the next meeting of officials in June and hopefully finalised at the BRICS ministerial meet in October,” a government official told BusinessLine . MSMEs in Brazil, for instance, are highly successful in participating in government procurements, he said, adding that they “capture almost 90 per cent of the business. Other countries could draw from Brazil’s legislative frameworks and other policy initiatives to help their small industry also get a chunk of government business.”

The BRICS grouping of five emerging economies — Brazil, Russia, India, China and South Africa — together account for a GDP of over $16 trillion, which is about half that of the seven major advanced economies. More than 40 per cent of the BRICS economies are driven by the MSME sector, according to government estimates.

The Commerce and Industry Ministry is also holding discussions with the industry to give a final shape to its proposal of putting in place a BRICS portal for addressing non-tariff measures (NTMs) that hamper trade between the BRICS.

Exporters’ body FIEO is one of the industry bodies giving inputs for the proposed portal.

“One of the biggest problems faced by exporters in the five countries is the lack of knowledge on various non-tariff measures (NTMs), such as new standards or specifications. Most of the times they get to know about the NTMs only when their goods are rejected. If this issue is addressed, it will serve as a big incentive for industry in the five nations to trade with each other,” said Ajay Sahai of FIEO.

Source: http://www.thehindubusinessline.com/todays-paper/india-moots-framework-for-sme-sector-cooperation-in-brics/article8617609.ece

Income Tax return is not considered filed unless it’s e-verified

by | posted in: Corporate Updates, Income Tax,e-Filing- Individuals, Firms, Companies | 0

Several taxpayers diligently file their tax returns but forget to e-verify them.

They believe their return filing process is complete once return has been duly submitted to the income tax department.

 

Your income tax (I-T) return submission is not complete unless you’ve ticked off the e-verification with the following steps :

 

Step 1: You have e-filed your tax return

 

Step 2: You have e-verified the return

 

Step 3: Final return processing by the tax department i.e. refund is processed or intimation under Section 143(1) is received.

 

Taxpayers who do not verify end up with incomplete filings. A refund, if any, is not processed in such cases.

 

Returns can be verified either electronically or by sending the physical ITR-V to CPC, Bengaluru. ITR-V is a one-page document, emailed by the I-T department to you; it can also be downloaded from the department’s website. ITR-V must be signed in blue ink and sent via ordinary or speed post to CPC, Bengaluru. You cannot courier the ITR-V. Sending the physical ITR-V involved a lot of problems. With the introduction of electronic verification, your return can now be verified easily and quickly.

 

There are several ways to verify your tax returns. To begin, log in to your e-filing account with your PAN and date of birth. Click on ‘e-File’ from the blue top bar. There is an option under it, ‘e-Verify Return’; select it. Select one of the options listed to e-verify.

 

EVC sent to registered email ID and mobile number

 

This option is available to taxpayers who have a total income of less than R5 lakh and there is no refund. A 10-digit alphanumeric code is sent to their email id and mobile number, registered on the tax department website, which is valid for 72 hours.

 

EVC via Aadhaar OTP

 

If you don’t have a refund, you can also e-verify via an Aadhaar OTP. Your Aadhaar card must be linked to your PAN on the e-filing website. The OTP is sent to your mobile number registered with Aadhaar and is valid for 10 minutes.

 

EVC through net banking

 

Those with an income of over R5 lakh, or with a refund, have to use net banking to e-verify returns. If your bank is authorised, you’ll be able to log in to e-filing through net banking. First, log in to your bank account and look for the e-filing option. When you confirm to e-verify, an EVC will be automatically generated and applied to the return; your e-verification will be complete. Don’t assume the refund will be credited to the net banking account you have used to e-verify. It is credited to the account selected for refund in your tax return, which may be different from the account you used to e-verify.

 

EVC through bank account number

 

You can also verify your tax return through your bank account number by logging in to the income tax department website. Your bank account number must be pre-validated. To validate, you have to select your bank name, enter the bank account number, IFSC and mobile number, and validate it on the income tax department website.

 

The department has issued a circular giving a final chance to taxpayers to put their past tax returns in order. If you had submitted your tax return for the past six years from AY 2009-10 to AY 2014-15, but the return could not be processed for want of ITR-V, you can e-verify it by August 31, 2016. The department shall process such returns by November 30. This will help put your past records in order.