Notifications & Circulars

Reserve Bank of India

27.04.2017

Banking

Risk Management Systems - Role of the Chief Risk Officer

MANU/RMIC/0055/2017

1. Please refer to the guidelines on Risk Management Systems issued vide our circular DBOD.No.BP.(SC).BC.98/21.04.103/99 dated October 7, 1999 and the Guidance Notes on Management of Credit Risk and Market Risk issued in terms of our circular DBOD. No. BP. 520/21.04.103/2002-03 dated October 12, 2002.

2. As part of effective risk management, banks are required, inter-alia, to have a system of separation of credit risk management function from the credit sanction process. However, it is observed that the banks follow diverse practices in this regard. In order to bring uniformity in approach followed by banks, as also, to align the risk management system with the best practices, banks are advised as under:

a. They shall lay down a Board-approved policy clearly defining the role and responsibilities of the CRO.

b. Appointment of the CRO shall be for a fixed tenure with the approval of the Board of Directors of the banks. The CRO may be transferred/removed from his post before completion of the tenure only with the approval of the Board and such premature transfer/removal shall be reported to the Department of Banking Supervision, Reserve Bank of India, Mumbai. In case of listed banks, any change in incumbency of CRO shall be reported to the stock exchanges also.

c. CRO shall be a senior official in the banks' hierarchy and shall have the necessary and adequate professional qualification/experience in the areas of risk management.

d. The CRO shall have direct reporting lines to the MD & CEO / Risk Management Committee (RMC) of the Board. In case the CRO reports to the MD & CEO, the RMC shall meet the CRO on one-to-one basis, without the presence of the MD & CEO, at least on a quarterly basis.

e. The CRO shall not have any reporting relationship with the business verticals of the bank and shall not be given any business targets.

f. In case the CRO is associated with the credit sanction process, it shall be clearly enunciated whether the CRO's role would be that of an adviser or a decision maker. The policy shall include the necessary safeguards to ensure the independence of the CRO.

g. In banks that follow committee approach in credit sanction process for high value proposals, if the CRO is one of the decision makers in the credit sanction process, he shall have voting power and all members who are part of the credit sanction process, shall individually and severally be liable for all the aspects, including risk perspective related to the credit proposal. If the CRO is not a part of the credit sanction process, his role will be limited to that of an adviser.

h. In banks which do not follow committee approach for sanction of high value credits, the CRO can only be an adviser in the sanction process and shall not have any sanctioning power.

i. The CRO in his role as an adviser shall be an invitee to the credit sanction/approval committee without any voting rights in the proceedings of the committee.

j. There shall not be any 'dual hatting' i.e. the CRO shall not be given the responsibility of Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, Chief of the internal audit function or any other function.

Tags : Role Risk Officer

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Insurance Regulatory and Development Authority

26.04.2017

Insurance

Inclusion of "Farmer Producer Company (FPC) in the list of Micro Insurance Agent"

MANU/IRDA/0017/2017

Reference is invited to Regulation 2 (f) of IRDAI (Micro Insurance) Regulations 2015 (Regulations) which defines a "Micro-insurance Agent". Based on the feedback of the Insurers, it has been decided by the Competent Authority to include the "Farmer Producer Companies (FPC)" registered under Companies Act, 2013 (reference: Section 465 (1) of the Companies Act, 2013 and Part IX A of Companies Act, 1956) in the list of "Micro Insurance Agents". This Circular is issued by exercising the powers vested under Regulation 14 (2) (e) of IRDA Act, 1999 and comes into force with immediate effect.

Tags : FPC Inclusion Micro Insurance

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Securities and Exchange Board of India

26.04.2017

Capital Market

Acceptance of Central Government Securities by Clearing Corporations towards Core Settlement Guarantee Fund (SGF) Contribution by Clearing Members

MANU/SMIS/0002/2017

1) SEBI vide circular no. CIR/MRD/DRMNP/25/2014 dated August 27, 2014, specified the guidelines for Core Settlement Guarantee Fund, Default Waterfall and Stress Test for Clearing Corporations.

2) Based on the feedback received from the market participants and the recommendation of the Risk Management Review Committee of SEBI, it has been decided that the clearing members shall be permitted to bring their contribution towards Core Settlement Guarantee Fund, in the form of Central Government Securities, in addition to Cash and Bank Fixed Deposits in terms of point 11 of the abovementioned SEBI circular dated August 27, 2014.

3) Clearing Corporations are directed to:

a) take necessary steps to put in place systems for implementation of the circular, including necessary amendments to the relevant bye-laws, rules and regulations;

b) bring the provisions of this circular to the notice of their members and also disseminate the same on its website; and

c) communicate to SEBI, the status of implementation of the provisions of this circular in the Monthly Report.

4) This circular is being issued in exercise of powers conferred under Section 11 (1) of the Securities and Exchange Board of India Act, 1992 to protect the interests of investors in securities and to promote the development of, and to regulate, the securities market.

5) This circular is available on SEBI website. under the category "Circulars".

Tags : Securities Acceptance Core Settlement

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Reserve Bank of India

26.04.2017

Banking

RBI proposes fresh Regulations under Foreign Exchange Management Act, 1999 for Cross Border Mergers: Invites comments from stakeholders

MANU/RPRL/0075/2017

The Reserve Bank today has placed on its website the draft guidelines proposed to be issued on cross border merger transactions pursuant to the Rules notified by Ministry of Corporate Affairs through Companies (Compromises, Arrangements and Amalgamation) Amendment Rules, 2017 on April 13, 2017. Section 234 of the Companies Act, 2013 provides for mergers and amalgamations between Indian companies and foreign companies. Accordingly, Ministry of Corporate Affairs has issued Companies (Compromises, Arrangements and Amalgamation) Amendment Rules, 2017 on April 13, 2017 to operationalize this section. The Reserve Bank of India has proposed these Regulations under the Foreign Exchange Management Act, 1999 (FEMA) in order to address the issues that may arise when an Indian company and a foreign company enter into Scheme of merger, demerger, amalgamation, or rearrangement. These Regulations stipulate conditions that should be adhered to by the companies involved in the Scheme. The Regulations shall be named Foreign Exchange Management (Cross Border Merger) Regulations. Members of public, including the stakeholders and experts in the area, are requested to offer their views and comments on the proposed Regulations. The comments may be sent latest by May 9, 2017 to email with the subject "Cross Border Mergers - Comments/Suggestions".

Tags : Cross Border Mergers Regulations Proposal

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Ministry of Finance

25.04.2017

Service Tax

Extension of date of submission Form ST-3 for the period from 1st October 2016 to 31st March 2017, from 25th April, 2017 to 30th April, 2017

MANU/DSTX/0021/2017

In exercise of the powers conferred by sub-rule(4) of rule 7 of the Service Tax Rules, 1994, the Central Board of Excise & Customs hereby extends the date of submission of the Form ST-3 for the period from 1st October 2016 to 31st March 2017, from 25th April, 2017 to 30th April, 2017.

The circumstances of a special nature, which have given rise to this extension of time, are as follows:

“Intermittent difficulties have been faced by assessees in accessing the ACES website on 25th April 2017"

Tags : ST-3 Submission Date Extension

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Ministry of Finance

25.04.2017

Direct Taxation

Lease rent from letting out buildings/developed space along with other amenities in an Industrial Park/SEZ- to be treated as business income

MANU/DTCR/0017/2017

The issue whether income arising from letting out of premises /developed space along with other amenities in an Industrial Park/SEZ is to be charged under head 'Profits and Gains of Business' or under the head 'Income from House Property' has been subject matter of litigation in recent years. Assessees claim the letting out as business activity, the income arising from which to be charged to tax under the head 'Profits and Gains of Business', whereas the Assessing Officers hold it to be chargeable under the head 'Income from House Property'.

2. The matter has been considered by the Board. Income from the Industrial Parks/ SEZ established under various schemes framed and notified under section 80IA(4)(iii) of the Income-tax Act, 1961 ('Ace') is liable to be treated as income from business provided the conditions prescribed under the schemes are met.

In the case of Velankani Information Systems Pvt Ltd, the Hon'ble Karnataka High Court observed that any other interpretation would defeat the object of section 80IA of the Act and government schemes for development of Industrial Parks in the country. SLPs filed in this case by the Department have been dismissed by the Hon'ble Supreme Court.

In a subsequent judgment dated 30.04.2014 in ITA No 76 & 78/2012 in the case of CIT vs. Information Technology Park Ltd.2, the Karnataka High Court has reaffirmed its earlier views. It has held that, since the assessee-company was engaged in the business of developing, operating and maintaining an Industrial Park and providing infrastructure facilities to different companies as its business, the lease rent received by the assessee from letting out buildings along with other amenities in a software technology park would be chargeable to tax under the head "Income from Business" and not under the head "Income from House Property". The judgement has been accepted by the Board.

3. In view of the above, it is now a settled position that in the case of an undertaking which develops, develops and operates or maintains and operates an industrial park/SEZ notified in accordance with the scheme framed and notified by the Government, the income from letting out of premises/ developed space along with other facilities in an industrial park/SEZ is to be charged to tax under the head 'Profits and Gains of Business'.

4. Accordingly, henceforth, appeals may not be filed by the Department on the above settled issue and those already filed may be withdrawn/ not pressed upon.

5. The above may be brought to the notice of all concerned.

Tags : Lease rent Industrial Park Business income

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Ministry of Consumer Affairs, Food and Public Distribution

25.04.2017

Civil

Removal of Licensing Requirements, Stock Limits and Movement Restrictions on Specified Foodstuffs (Amendment) Order, 2017

MANU/CAFF/0058/2017

In exercise of the powers conferred by section 3 of the Essential Commodities Act, 1955 (10 of 1955), the Central Government hereby makes the following order to amend the Removal of Licensing Requirements, Stock Limits and Movement Restrictions on Specified Foodstuffs Order, 2016, namely:-

1. (1) This order may be called the Removal of Licensing Requirements, Stock Limits and Movement Restrictions on Specified Foodstuffs (Amendment) Order, 2017.

(2) It shall come into force on the 29th day of April 2017.

2. In the Removal of Licensing Requirements, Stock Limits and Movement Restrictions on Specified Foodstuffs Order, 2016, in clause 3, in sub-clause (2), for item (ii), the following item shall be substituted, namely:-

"(ii) sugar, for a period upto 28th October, 2017;".

Tags : Licensing Requirements Amendments

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Press Information Bureau

25.04.2017

Civil

Online Statement Of Transaction (e-SOT) and the e-PRAN card launched for Atal Pension Yojana (APY) subscribers

MANU/PIBU/0484/2017

With a view to digitally empower the Atal Pension Yojana (APY) subscribers and improve the quality of service, the facility of online viewing of the statement of transaction(e-SOT) and also the e-PRAN card have been launched. More than 45 lacs APY subscribers are likely to be benefitted. The APY subscribers can visit the website: www.npscra.nsdl.co.in or www.npstrust.org.in under the Atal Pension Yojana Section to avail these value added facilities.

By providing the APY/PRAN Acct details and Savings Bank Account number details, the APY subscriber can view one's APY Account Statement. Even for the APY subscriber who does not have his APY PRAN number readily available can also avail these facilities by providing one's Date of Birth and Savings Bank Account number details. This online tool enables the Subscribers to view his complete details of APY account like transaction details, pension amount, pension commencement date, nominee name, associated bank name etc. Even though the feature is a self-servicing tool but the service providers can also access the feature on behalf of their customer to improve the quality of customer service. APY Subscribers can print their e PRAN card and get it laminated for their future reference if needed. In case of any changes in the demographic details in the APY account, the subscribers can re-print their e-PRAN which shows the updated subscriber records.

The Atal Pension Yojana (APY) Scheme is being implemented through 235 APY-Service Providers all over the country consisting of 27 Public Sector Banks (PSBs), 19 private banks, 1 foreign bank, 56 Regional Rural Banks (RRBs), 109 District Cooperative Banks (DCBs), 16 State Cooperative Banks(SCBs), 6 Urban Cooperative Banks (UCBs) and the Department of Posts. All the APY-SPs are partners in achieving the APY outreach through-out the length and breadth of the country. Presently, there are more than 45 lacs subscribers registered in the Scheme. About 10000-15000 APY subscribers are getting enrolled into the Scheme every day.

The Atal Pension Yojana (APY) was launched by the Prime Minister of India Shri Narendra Modi on 09th May, 2015 and became operational from 1st June, 2015. APY is available for all citizens of India in the age group of 18-40 years. Under the APY, the subscribers would receive a minimum guaranteed pension of Rs. 1000 to Rs. 5000 per month from the age of 60 years, depending on their contributions, which depends on the age of the subscriber at the time of joining the APY. The Same amount of pension is paid to the spouse in case of subscriber's demise. After the demise of both i.e. Subscriber & Spouse, the nominee would be paid with the pension corpus. There is option for Spouse to continue to contribute for balance period on premature death of subscriber before 60 years, so as to avail pension by Spouse. There are tax benefits at entry, accumulation and pension payment phases. If the actual returns on the pension contributions during the accumulation phase are higher than the assumed returns for the minimum guaranteed pension, such excess returns are passed on to the subscriber, resulting in enhanced scheme benefits.

Tags : Pension Yojana Online Statement Transaction Launch

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Telecom Regulatory Authority of India

24.04.2017

Media and Communication

Annual Report of TRAI for the year 2015-16

MANU/TRAI/0036/2017

The Annual Report of Telecom Regulatory Authority of India for the year 2015-16 detailing activities of the Authority, certified accounts and the audit report thereupon has been laid on the Table of Lok Sabha on 29th March 2017 and the Rajya Sabha on 31st March 2017. The Annual Report of TRAI also details the policies and programmes, review of general environment in the telecom sector and broadcasting sector, review of working and operation of TRAI, functions of TRAI in respect of matters specified in Section 11 of the Telecom Regulatory Authority of India Act, 1997 and its organizational matters including financial performance. Copy of the Annual Report of TRAI for the year 2015-16 has been placed on website of TRAI for information of general public.

Tags : TRAI Annual Report Activities Details

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Ministry of Finance

24.04.2017

Excise

Central Government hereby directs that the whole of the duty of excise payable under Section 3 of Central Excise Act, 1944 on Heena Powder and Paste shall not be required to be paid

MANU/EXNT/0011/2017

Whereas the Central Government is satisfied that according to a practice that was generally prevalent regarding levy of duty of excise (including non-levy thereof) under section 3 of the Central Excise Act, 1944 (1 of 1944), (hereinafter referred to as the said Act), on Heena Powder and Paste falling under Chapter 33 of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) (hereinafter referred to as the said goods), was not being levied according to the said practice, during the period commencing on the 1st day of January, 2007 and ending with the 1st day of March, 2013; Now, therefore, in exercise of the powers conferred by section 11C of the said Act, the Central Government hereby directs that the whole of the duty of excise payable under section 3 of the said Act on the said goods but for the said practice, shall not be required to be paid in respect of the said goods on which the said duty of excise was not levied during the period aforesaid in accordance with the said practice.

Tags : Duty Non-Levy Heena Powder

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