Reserve Bank of India

08.08.2024

Banking

RBI imposes monetary penalty on Suvarnayug Sahakari Bank Ltd., Pune, Maharashtra

MANU/RPRL/0514/2024

The Reserve Bank of India (RBI) has, by an order dated August 05, 2024, imposed a monetary penalty of ₹2.00 lakh (Rupees Two lakh only) on Suvarnayug Sahakari Bank Ltd., Pune, for non-compliance with certain directions issued by RBI on 'Know Your Customer (KYC)'. This penalty has been imposed in exercise of powers vested in RBI, conferred under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.

The statutory inspection of the bank was conducted by RBI with reference to its financial position as on March 31, 2023. Based on supervisory findings of non-compliance with RBI directions and related correspondence in that regard, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said directions. After considering the bank's reply to the notice and oral submissions made by it during the personal hearing, RBI found, inter alia, that the charge of failure to update KYC of its customers as per prescribed periodicity was sustained, warranting imposition of monetary penalty.

This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers. Further, imposition of monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank.

Tags : Penalty Imposition Non- compliance

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Press Information Bureau

07.08.2024

MRTP/ Competition Laws

CCI approves acquisition of 100% equity stake, management and control in 12 special purpose vehicles of PNC Infratech Limited and PNC Infra Holdings by Highway Infrastructure Trust

MANU/PIBU/0614/2024

The Competition Commission of India (CCI) has approved the acquisition of 100% equity stake, management and control in twelve (12) special purpose vehicles of PNC Infratech Limited and PNC Infra Holdings (PNC SPVs/Targets) by Highway Infrastructure Trust (Acquirer Trust).

The Acquirer Trust is an irrevocable trust settled under the Indian Trusts Act, 1882, and is registered as an infrastructure investment trust with the Securities Exchange Board of India, to carry out the activities prescribed under the SEBI (Infrastructure Investment Trusts) Regulations, 2014. The Acquirer Trust owns special purpose vehicles incorporated in India, which are engaged in the business of operating roads and highways in India for which the special purpose vehicles have been granted government concessions. Galaxy Investments II Pte. Limited is the sponsor and Highway Concessions One Private Limited (HC One) is the investment manager, of the Acquirer Trust, in terms of the SEBI (Infrastructure Investment Trusts) Regulations, 2014.

The PNC SPVs have been incorporated as special purpose vehicles. The PNC SPVs have entered into concession agreements with the National Highway Authority of India / Uttar Pradesh State Highways Authority for holding, developing, operating, and maintaining infrastructure projects under Hybrid annuity model / Build-Operate-Transfer, respectively.

Tags : Acquisition Approval PNC Infratech

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Press Information Bureau

07.08.2024

Direct Taxation

CBDT relaxes provisions of TDS/TCS in event of death of deductee/collectee, before linkage of PAN and Aadhaar

MANU/PIBU/0621/2024

The Central Board of Direct Taxes (CBDT) has relaxed provisions of TDS/TCS in event of death of deductee/collectee, before linkage of PAN and Aadhaar.

In view of genuine difficulties being faced by taxpayers, CBDT issued the Circular no. 8 of 2024 dated 05.08.2024, and vide the same, the Government has relaxed the provisions of TDS/TCS as per the Income-tax Act, 1961(the 'Act') in the event of death of deductee/collectee before linking of PAN and Aadhaar.

In order to redress the grievances of the taxpayers wherein instances have been cited, of demise of the deductee/collectee on or before 31.05.2024 and before the option to link PAN and Aadhaar could have been exercised, the Circular provides that there shall be no liability on the deductor/collector to deduct/collect the tax under section 206AA/206CC of the Act, as the case maybe pertaining to the transactions entered into upto 31.03.2024.

This is in continuation of Circular no. 6 of 2024 dated 23.04.2024 issued earlier by CBDT wherein the date for linking of PAN and Aadhaar was extended upto 31.05.2024 for the taxpayers (for the transactions entered into upto 31.03.2024) to avoid higher TDS/ TCS as per the Act. The Circular No. 06 of 2024 dated 23.04.2024 and Circular No. 08 of 2024 dated 05.08.2024 are available on www.incometaxindia.gov.in.

Tags : Provisions TDS/TCS Relaxation

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Securities and Exchange Board of India

06.08.2024

Capital Market

Amendment to Master Circular for Infrastructure Investment Trusts (InvITs) dated May 15, 2024

MANU/SMIS/0028/2024

1. Para 22.3.1. (b) of Chapter 22, titled "Board nomination rights to unitholders of Infrastructure Investment Trusts (InvITs)", of the Master Circular for Infrastructure Investment Trusts dated May 15, 2024 requires as under:

"(b) Eligible Unitholder(s) shall be entitled to nominate only one Unitholder Nominee Director, subject to the unitholding of such Eligible Unitholder(s) exceeding the specified threshold. If the right to nominate one or more directors on the Board of Directors of the Investment Manager is available to any entity (or to an associate of such entity) in the capacity of shareholder of the Investment Manager or lender to the Investment Manager or the InvIT (or its HoldCo(s) or SPVs), then such entity in its capacity as unitholder, shall not be entitled to nominate or participate in the nomination of a Unitholder Nominee Director."

2. Market participants have requested to provide clarity on the availability of the right to nominate a director on the Board of Directors of the Investment Manager of InvIT, to a unitholder where such nomination right is also available to a unitholder in the capacity of lender to the Investment Manager or the InvIT (or its HoldCo(s) or SPVs).

3. In order to promote ease of doing business and based on the request of the industry and recommendation of Hybrid Securities Advisory Committee (HySAC), it is proposed to insert the following proviso under paragraph 22.3.1. (b) of Master Circular for Infrastructure Investment Trusts dated May 15, 2024:

"Provided that the above restriction relating to the right to nominate a Unitholder Nominee Director shall not be applicable if the right to appoint a nominee director is available in terms of clause (e) of sub-regulation (1) of regulation 15 of the SEBI (Debenture Trustees) Regulations, 1993."

4. This circular shall come into force with immediate effect.

5. This circular is being issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 and Regulation 4(2)(h) of the SEBI (Infrastructure Investment Trusts) Regulations, 2014. This circular is issued with the approval of the competent authority.

6. The recognized Stock Exchanges are advised to disseminate the contents of this Circular on their website.

Tags : Amendment Master Circular InvITs

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Securities and Exchange Board of India

05.08.2024

Capital Market

Valuation of Additional Tier 1 Bonds

MANU/SMFD/0007/2024

1. This has reference to clause 9.3.1.1 and clause 9.4.2 of the Master Circular No. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024 for Mutual Funds ("Master Circular"), on valuation of bonds with multiple call options.

2. National Financial Reporting Authority (NFRA), in its report to Department of Economic Affairs, Ministry of Finance, has recommended that since the market practice for AT-1 bonds has been observed to trade at or quote prices closer to Yield to Call (YTC) basis, valuation of AT-1 Bonds on Yield to Call basis (adjusted with appropriate risk spreads) will be consistent with the principles of market-based measurement under Ind AS 113.

3. NFRA, in its report, has further stated that the above recommendation on YTC methodology is confined only to the interpretation of Ind AS 113 with reference to the valuation of AT-1 bonds and the issue of deemed maturity date for other purposes is outside NFRA's remit.

4. In view of the above, in order to align the valuation methodology with the recommendation of NFRA, it has been decided that the valuation of AT-1 Bonds by Mutual Funds shall be based on Yield to Call.

5. For all other purposes, since liquidity risk of perpetual bonds is required to be suitably captured, deemed maturity of all perpetual bonds shall continue to be in line with the clause 9.4.2 of the Master Circular.

6. This circular is issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992, read with the provisions of Regulation 25(19), 47 read with Regulation 77 of SEBI (Mutual Funds) Regulations, 1996, to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.

Tags : Valuation Additional Tier 1 Bonds

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Ministry of Corporate Affairs

05.08.2024

Insolvency

Limited Liability Partnership (Amendment) Rules, 2024

MANU/DCAF/0024/2024

In exercise of the powers conferred by sub-sections (1) and (2) of section 79 of the Limited Liability Partnership Act, 2008 (6 of 2009), the Central Government hereby makes the following rules further to amend the Limited Liability Partnership Rules, 2009, namely: -

1. (1) These rules may be called the Limited Liability Partnership (Amendment) Rules, 2024.

(2) They shall come into force with effect from 27th day of August, 2024.

2. In the Limited Liability Partnership Rules, 2009, in rule 37,-

(i) in sub-rule (1),-

(A) in clause (b), after the word "Registrar", the words "the Centre for Processing Accelerated Corporate Exit" shall be inserted;

(B) in the first proviso, after the word "Registrar", the words "the Centre for Processing Accelerated Corporate Exit" shall be inserted;

(C) the following Explanation shall be inserted, namely:-

"Explanation.- for the purposes of this sub-rule, the Centre for Processing Accelerated Corporate Exit means the office of Centre for Processing Accelerated Corporate Exit established by the Central Government, vide notification number S.O. 1269(E), dated 17th March, 2023 issued under sub-sections (1) and (2) of section 396 of the Companies Act, 2013 (18 of 2013)";

(ii) in sub-rule (3), after the word "Registrar" occurring at both places, the words "or the Centre for Processing Accelerated Corporate Exit, as the case may be" shall be inserted;

(iii) in sub-rule (4), after the word "Registrar", the words "or the Centre for Processing Accelerated Corporate Exit, as the case may be" shall be inserted

Tags : LLP Amendment Rules

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