HIGHLIGHTS IN INSOLVENCY AND BANKRUPTCY CODE, 2016

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The Insolvency and Bankruptcy 2015 was brought in Lok Sabha on 21st December 2015 and was appeal to Joint Committee. The report was shown in Lok Sabha and Rajya Sabha on 28th April 2016. This code has been passed by Lok Sabha on 5th May 2016 and by Rajya Sabha on 11th May 2016.

codes read as follows:-

For revise the laws related to reorganization and insolvency resolution of corporate persons, partnership firms and individuals in a time bound manner for maximization of value of assets of such persons for advertise entrepreneurship, availability of credit and balance the interest of all the stakeholders including alteration in the priority of payment of Government dues and to establish an Insolvency and Bankruptcy Fund and for matters connected therewith.

  • Codes cover Insolvency of individuals, unlimited liability partnerships, Limited Liability partnerships and companies.
  • The Insolvency Resolution Process for individuals and unlimited liability partnerships varies from the one for companies and LLPs. The Debt Recovery Tribunal should be the Adjudicating Authority with jurisdiction over individuals and unlimited liability partnership firms. The Appeals from the order of DRT should be taken in Debt Recovery Appellate Tribunal. The National Company Law Tribunal shall be the Adjudicating Authority with jurisdiction over companies & LLPs. The appeal from the Order of NCLT should be taken in National Company Law Appellate Tribunal.
  • Codes aims to abolished of the presidency towns insolvency act 1909 and provincial insolvency act 1920.

CODES AIM TO REVISE THE FOLLOWING ELEVEN LAWS:-

  • The Indian Partnership Act 1932
  • The Central Excise Act 1944
  • The Income Tax Act 1961
  • The Customs Act 1962
  • Recovery of Debts Due to Banks and Financial Institutions Act 1993.
  • The Finance Act 1994.
  • The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.
  • Sick Industrial Companies (Special Provisions) Repeal Act 2003.
  • The payment and Settlement Systems Act 2007.
  • The Limited Liability Partnership Act 2008.
  • The Companies Act, 2013.

The codes come up with an insolvency regulator to keep monitoring over:-

  • Insolvency Professionals (IP)
  • Insolvency Professionals Agencies (IPA)
  • Information Utilities (IU)

 The Insolvency and Bankruptcy Board of India will guide these agencies to develop professional standards, codes of ethics and exercise a disciplinary check on faulty members for development of a competitive industry for insolvency professionals. The codes offer information utilities which would gather, collect, attest and broadcast financial information from listed companies and financial as well as operational creditor’s information from companies. An individual insolvency database is also introduced to be set up with the goal of giving information on insolvency status of individuals.

The Code proposes a fast process and timeline of 180 days is set for dealing with applications for corporate insolvency resolution. This can be extended for 90 days by the Adjudicating Authority only in some exceptional cases. During insolvency resolution period ( 180/270 days), the management of the debtor is placed in the hands of an  resolution professional. An insolvency resolution plan made by the resolution professional has to be accepted by at least 75% of voting share of the financial creditors.  Plan will need sanction of the Adjudicating Authority. If plan is rejected, the Adjudicating Authority will make an order for the liquidation. The code offer a fast track insolvency resolution process for companies who have small operations. The process will have to be completed within 90 days that can be extended up to 45 days more if the 75% of the financial creditors agree with this extension.

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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corporate and professional updates 25th JUNE 2018

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  • Kolkata ITAT dismisses Revenue’s appeal for AY 2009-10, deletes long term capital gains (‘LTCG’) addition u/s. 50B, made by the AO on transfer of Trading and Distribution (‘T&D’) division of assessee-company (GE Healthcare OY’s wholly owned subsidiary) to Wipro GE Healthcare vide demerger (approved w.e.f. April 1, 2008); [TS-320-ITAT-2018(Kol)]
  • Calcutta HC sets aside ITAT order for AY 1983-84, allows Brooke Bond India’s investment allowance claim u/s. 32A on weighing machines, electrical equipments, other machineries and computers; Rejects Revenue’s stand that to qualify for allowance,  a plant / machinery has to be directly used in the manufacture of an article or thing;  [TS-318-HC-2018(CAL)]
  • Mumbai ITAT rules that capital gains of Rs. 455.70 Cr. arising to assessee-company (a tax resident of Singapore), pursuant to trading in Indian securities during AY 2011-12, not taxable in India under Article 13(4) of India-Singapore DTAA; [TS-321-ITAT-2018(Mum)]
  • CBDT proposes clear-cut timelines under transfer pricing, through a draft notification, suggested that the amount should be returned within 90 days of signing of APAs and MAPs.
  • Due date for furnishing challan-cum-statement in respect of tax deducted U/s 194-IA & 194-IB for m/o May’18- June30,

INDIRECT TAX

  • CBIC has issued a circular clarifying the procedure for interception of conveyances for inspection of goods in movement,and detention, release, and confiscation of such goods and conveyances.
    • Goods without eway bill, bill etc can be confiscated/detained. Others in same vehicle, with proper papers can’t be held. Circular 49 of 21.6.18.

FAQ on E-WAY BILLS:

  • Query:In case of movement of goods by Railways, is there a requirement for railway to carry e-way bill along with goods?
  • Answer: In case of movement of goods by Railways, there is no requirement to carry e-way bill along with the goods, but railways has to carry invoice or delivery challan or bill of supply as the case may be along with goods.

SEBI UPDATES

  • Sebi is set to revamp IPO norms to make them less onerous for legitimate sellers while clamping down on possible misuse. These include recognizing a wider set of institutional investors such as alternative investment funds (AIFs) as counting toward promoters’ contribution in startups, requiring financial disclosures for three years rather than five and reducing disclosure of the price band to two days before the issue opens from five now.

OTHER UPDATES

  • The Insolvency and Bankruptcy Code, 2016 consolidates and amends the laws relating to reorganization and insolvency resolution of corporate persons, partnership firms and individuals in a time bound manner for maximization of the value of assets of such persons, to promote entrepreneurship, availability of credit and balance the interests of all the stakeholders.
  • NSE is in the process of introducing a corporate governance code that will be stricter than the existing laws and regulations.

KEY DATE:

  • QUARTERLY RETURN FOR REGISTERED PERSONS WITH AGGREGATE TURNOVER UP TO RS. 1.50 CRORES: GSTR-1 :-31. JULY 2018
  • DUE DATE FOR FILLING GST TRAN-2- 30.06.2018
Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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MINISTRY OF CORPORATE AFFAIRS RESENT CHANGES

MINISTRY OF CORPORATE AFFAIRS RESENT CHANGES

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As a part of ease of doing business government has once again further eased up the process of incorporation of a company by introduction of SPICE. I could term it as easiest and fastest process all over the globe to incorporate a company where in one can incorporate company, forget days in hours.

Ministry of Corpoate Affairs has introduced SPICE (Simplified Proforma for incorporating Company electronically) w.e.f. 02.10.2016 in e-form INC-32.

Highlights of INC-32

1) This form can be filed even after approval of INC-1. This facility was not provided in INC-29.

2) Memorandum of Association has been provided in Electronic Mode INC-33.

3) Article of Association has been provided in Electronic Mode INC-34.

4) By new e-MOA & AOA, no need of signatures of subscribers. Instead of sign of subscribers DSC of Subscribers can be affixed on MOA & AOA.

5) By new e-MOA & AOA no need of signatures of witness. Instead of sign of witness DSC of witness can be affixed on MOA & AOA.

6) Information in the form has increased in comparison to eForm INC-29.

REVISION THE VERSION OF MCA FORMS

MCA has revised the version of following e-forms :

FORM NAMES PARTICULAR
Form MGT-15 Form for filing Report on Annual General Meeting
Form FC-3 Annual accounts along with the list of all principal places of business in India established by foreign company
Form INC-4 One Person Company- Change in Member/Nominee
Form MGT-14 Filing of Resolutions and agreements to the Registrar
Form 23C Form of application to the Central Government for appointment of cost auditor
Form 23D Information by cost auditor to Central Government
Form A-XBRL Form for filing XBRL document in respect of compliance report and other documents with the Central Government
Form I-XBRL Form for filing XBRL document in respect of cost audit report and other documents with the Central Government
Form 23AC XBRL Form for filing XBRL document in respect of balance sheet and other documents with the Registrar
Form 23ACA XBRL Form for filing XBRL document in respect of Profit and Loss account and other documents with the Registrar
Form AOC-4 XBRL Form for filing XBRL document in respect of financial statement and other documents with the Registrar

Stakeholders are advised to check the latest version before filing.

COSTING TAXONOMY

Costing taxonomy 2012 for filing Forms I-XBRL and A-XBRL along with business rules is available on XBRL portal w.e.f. 08 Oct 2016. Please visit the portal for latest validation tool and plan your filing accordingly.

MCA INVITING COMMENTS ON DRAFT REGULATION ON INSOLVENCY AND BANKRUPTCY CODE, 2016

The MCA has issued Notice inviting comments/ suggestions on the draft regulations relating to Insolvency and Bankruptcy Code, 2016 available on the website of MCA. MCA had set-up a working group consisting of practitioners and experts for making recommendations for drafting regulations for registration and regulation of insolvency professionals and insolvency professional agencies under the Code. MCA, on behalf of the Insolvency and Bankruptcy Board of India has invited comments/ suggestions which shall be submitted in the prescribed format available on the website of MCA latest by 28 Oct. 2016.

  MCA has revised the version of e-forms: Form MGT-15, Form FC-3, Form INC-4, Form MGT-14, Form 23C, Form 23D, Form A-XBRL, Form I-XBRL, Form 23AC XBRL, Form 23ACA XBRL and Form AOC-4 XBRL, Costing taxonomy 2012 for filing Forms I-XBRL and A-XBRL w.e.f.  08.10.2016.

  MCA has issued notice inviting comments/ suggestions on the draft regulations relating to insolvency and bankruptcy code, 2016 available on the website of MCA.

MCA has released Updated C&I Taxonomy 2016 for filing Annual Financial Statements in Form AOC-4 XBRL in respect of financial years commencing on or after 01.04.2014

MCA has issued Notice inviting comments/ suggestions on the draft regulations relating to Insolvency and Bankruptcy Code, 2016 available on the website of MCA.

MCA has revised the version of e-forms viz. MGT-15, FC-3, INC-4, MGT-14, 23C, 23D, A-XBRL, I-XBRL, 23AC XBRL, 23ACA XBRL, AOC-4 XBRL.

MCA has released Updated C&I Taxonomy 2016 for filing Annual Financial Statements in Form AOC-4 XBRL in respect of financial years commencing on or after 01.04.2014.

We look forward for your valuable comments. www.carajput.com

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