19 August 2019


Notifications & Circulars

Press Information Bureau

15.08.2019

Civil

Report of the Competition Law Review Committee submitted to Union Finance and Corporate Affairs Minister

MANU/PIBU/1356/2019

Key recommendations include introduction of a 'Green Channel' for combination notifications to enable fast-paced regulatory approvals of mergers and acquisitions

Shri Injeti Srinivas, Secretary (Corporate Affairs), today presented the Report of the Competition Law Review Committee to the Union Minister of Finance and Corporate Affairs, Smt. Nirmala Sitharaman.

The Committee consulted various stakeholders, including industry chambers, professional institutes, Government Departments/Ministries, NGOs and experts. The Committee focused on furthering ease of doing business, encouraging start-ups and meeting the challenges of the new economy. The key recommendations of the Competition Law Review Committee are:

Introduction of a 'Green Channel' for combination notifications to enable fast-paced regulatory approvals for vast majority of mergers and acquisitions that may have no major concerns regarding appreciable adverse effects on competition. The aim is to move towards disclosure based regime with strict consequences for not providing accurate or complete information.

Combinations arising out of the insolvency resolution process under the Insolvency and Bankruptcy Code will also be eligible for "Green Channel" approvals.

Introducing a dedicated bench in NCLAT for hearing appeals under the Competition Act.

Introduction of express provisions to identify 'hub and spoke' agreements as well as agreements that do not fit within typical horizontal or vertical anti-competitive structures to cover agreements related to business structures and models synonymous with new age markets.

Additional enforcement mechanism of 'Settlement & Commitments" in the interests of speedier resolution of cases of anti-competitive conduct.

Enabling provisions to prescribe necessary thresholds, inter alia, deal-value threshold for merger notifications.

CCI to issue guidelines on imposition of penalty to ensure more transparency and faster decision making which will encourage compliance by businesses.

Strengthening the governance structure of CCI with the introduction of a Governing Board to oversee advocacy and quasi-legislative functions, leaving adjudicatory functions to the Whole-time Members.

Merging DG's Office with CCI as an 'Investigation Division' as it aids CCI in discharging an inquisitorial rather than adversarial mandate. However, functional autonomy must be protected.

Opening of CCI offices at regional level to carry out non-adjudicatory functions such as research, advocacy etc. and interaction with State Governments and State regulators.

The Government constituted a Competition Law Review Committee on 1st October, 2018 to review the existing Competition law framework and make recommendations to further strengthen the framework to inter alia meet new economy challenges. The Committee was chaired by Shri Injeti Srinivas (Secretary, Ministry of Corporate Affairs) and consisted of Members, namely, Shri Ashok Kumar Gupta (Chairperson, CCI), Dr. M.S. Sahoo (Chairperson, IBBI), Shri Haigreve Khaitan (M/s Khaitan & Co.), Ms. Pallavi Shardul Shroff (M/S Shardul Amrchand Mangaldas & Co.), Dr. Harshavardhana Singh (IKDHVAJ Advisors LLP), Dr. S. Chakravathy (Retd. IAS), Dr. Aditya Bhattacharya (Professor of Economics, Delhi School of Economics), Shri Anand Pathak (PA Law Offices), Shri KVR Murty (Joint Secretary, MCA & Member Secretary).

Tags : Report Review Committee Submission

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Press Information Bureau

15.08.2019

Direct Taxation

CBDT takes further steps to ensure transparency in Tax Administration by bringing in concept of DIN

MANU/PIBU/1358/2019

With a view to bringing greater transparency in the functioning of the tax-administration and improvement in service delivery, almost all notices and orders of Income Tax Department are being generated electronically on the Income Tax Business Application (ITBA) platform. However, it has been brought to the notice of the Central Board of Direct Taxes (CBDT) that there have been some instances in which the notice, order, summons, letter and any correspondence (hereinafter referred to as "communication") were found to have been issued manually, without maintaining a proper audit trail of such communication.

In order to prevent such instances and to maintain proper audit trail of all communication, the CBDT has, vide Circular No.19/2019 dated 14.08.2019 laid down parameters specifying the manner in which any communication issued by any income-tax authority relating to assessment, appeals, orders, statutory or otherwise, exemptions, enquiry, investigation, verification of information, penalty, prosecution, rectification, approval etc. to the assessee or any other person will be dealt with. All such communication issued on or after the 1st of October, 2019 shall carry a computer-generated Document Identification Number (DIN) duly quoted in the body of such communication.

CBDT has also specified exceptional circumstances where the communication may be issued manually but only after recording reasons in writing and with the prior written approval of the Chief Commissioner / Director General of Income-Tax concerned. In cases where manual communication is required to be issued, the reason for issue of manual communication without DIN has to be specified along with the date of obtaining written approval of the Chief Commissioner / Director General of Income-Tax in a particular format. Any communication which is not in conformity with the prescribed guidelines shall be treated as invalid and shall be deemed to have never been issued. Further, CBDT has also laid down the timelines and procedure by which such communication issued manually will have to be regularised and intimated to the Principal Director General of Income-tax (Systems).

In addition to the above, in all pending assessment proceedings, where notices were issued manually, prior to issuance of the above referred Circular, all such cases would be identified and the notices so sent would be uploaded on ITBA by 31st October, 2019.

This is another step taken by CBDT towards better delivery of taxpayer services while ensuring accountability in official dealings.

Tags : Transparency Tax Administration Steps

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Press Information Bureau

15.08.2019

MRTP/ Competition Laws

Price-Fixing Cartel amongst suppliers of Electric Power Steering Systems to automobile Original Equipment Manufacturers

MANU/PIBU/1357/2019

The Competition Commission of India ('CCI') passed a final order with respect to cartelisation amongst NSK Limited, Japan ('NSK') and JTEKT Corporation, Japan ('JTEKT') and their Indian subsidiaries namely Rane NSK Steering Systems Ltd. ('RNSS') and JTEKT Sona Automotive India Limited ('JSAI') respectively, in relation to the supply of Electric Power Steering ('EPS') Systems to three automotive Original Equipment Manufacturers ('OEMs'), by means of directly or indirectly determining price, allocating markets, co-ordinating bid response and manipulating the bidding process in Request for Information/Request for Quotations ('RFIs/RFQs') issued by these three automobile OEMs. The duration of the cartel was found to be from 2005 to 25.07.2011.

The case was initiated on the basis of an application received by the CCI under Section 46 of the Competition Act, 2002 (the 'Act') read with Competition Commission of India (Lesser Penalty) Regulations, 2009 ('LPR'), from NSK/RNSS. Thereafter, during the pendency of investigation, JTEKT/JSAI also approached the CCI by filing an application under the Section 46 of the Act read with the LPR.

The evidence collected in the case included instances of meetings and telephonic exchanges in which commercially sensitive information about prices etc. was discussed. Such conduct of the parties was found to have caused appreciable adverse effect on competition in India. Accordingly, the CCI concluded that NSK and JTEKT, and their Indian subsidiaries RNSS and JSAI respectively, indulged into anti-competitive conduct in contravention of the provisions of Section 3(3)(a) read with Section 3(1) of the Act.

Considering all the relevant factors, penalty, in terms of the proviso to Section 27 (b) of the Act, was computed for each party, from the date of enforcement of the provisions of Section 3 of the Act i.e. 20.05.2009 till 25.07.2011. In terms thereof, the penalty to be imposed upon NSK/RNSS was computed at the rate of 4% of the relevant turnover of RNSS and upon JTEKT/JSAI, at the rate of 1 time of the relevant profit of JSAI. Also, considering the totality of facts and circumstances of the case, penalty, in terms of Section 27 (b) of the Act, to be imposed on the individuals of NSK and JTEKT, held liable under Section 48 of the Act, was computed at the rate of 10 percent of the average of their income for the preceding three years.

In view of the fact that NSK/RNSS was the first to approach the Commission as a Lesser Penalty applicant and had provided complete, true and full disclosures, 100 percent reduction in penalty was granted to NSK/RNSS and its individuals and the penalty to be paid by them is nil. Further, in view of the fact that JTEKT/JSAI was the second to approach the Commission as a Lesser Penalty applicant and had provided significant value addition in the matter, 50 percent reduction in penalty was granted to JTEKT/JSAI and its individuals. Therefore, the total penalty to be paid by JTEKT/JSAI is INR 17,07,31,443/-.

Tags : Price-Fixing Cartel Suppliers

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Ministry Of Home Affairs

14.08.2019

Civil

Enforcement date of Unlawful Activities Prevention (Amendment) Act, 2019

MANU/HOME/0110/2019

S.O.2938(E).--In exercise of the powers conferred by sub-section (2) of section 1 of the Unlawful Activities Prevention (Amendment) Act, 2019 (28 of 2019), the Central Government hereby appoints the 14th August, 2019, as the date on which the provisions of the said Act shall come into force.

Tags : Enforcement date Amendment

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Ministry of Finance 

14.08.2019

Direct Taxation

Generation/Allotment/Quoting of Document Identification Number in Notice/Order/Summons/letter/correspondence issued by the Income-Tax Department

MANU/DTCR/0021/2019

With the launch of various e-governance initiatives, Income-tax Department is moving toward total computerization of its work. This has led to a significant improvement in delivery of services and has also brought greater transparency in the functioning of the tax-administration. Presently, almost all notices and orders are being generated electronically on the Income Tax Business Application (ITBA) platform. However, it has been brought to the notice of the Central Board of Direct Taxes (the Board) that there have been some instances in which the notice, order, summons, letter and any correspondence (hereinafter referred to as "communication") were found to have been issued manually, without maintaining a proper audit trail of such communication.

2. In order to prevent such instances and to maintain proper audit trail of all communication, the Board in exercise of power under section 119 of the Income-tax Act, 1961 (hereinafter referred to as the Act"), has decided that no communication shall be issued by any income-tax authority relating to assessment, appeals, orders, statutory or otherwise, exemptions, enquiry, investigation, verification of information, penalty, prosecution, rectification, approval etc. to the assessee or any other person, on or after the 1st day of October, 2019 unless a computer-generated Document Identification Number (DIN) has been allotted and is duly quoted in the body of such communication.

3. In exceptional circumstances such as, -

(i) when there are technical difficulties in generating/allotting/quoting the DIN and issuance of communication electronically; or

(ii) when communication regarding enquiry, verification etc. is required to be issued by an income-tax authority, who is outside the office, for discharging his official duties; or

(iii) when due to delay in PAN migration, PAN is lying with non-jurisdictional Assessing Officer; or

(iv) when PAN of assessee is not available and where a proceeding under the Act (other than verification under section 131 or section 133 of the Act) is sought to be initiated; or

(v) When the functionality to issue communication is not available in the system,

the communication may be issued manually but only after recording reasons in writing in the file and with prior written approval of the Chief Commissioner / Director General of income-tax. In cases where manual communication -is required to be issued due to delay in PAN migration, the proposal seeking approval for issuance of manual communication shall include the reason for delay in PAN migration. The communication issued under aforesaid circumstances shall state the fact that the communication is issued manually without a DIN and the date of obtaining of the written approval of the Chief Commissioner / Director General of Income-Tax for issue of manual communication in the following format-

" .. This communication issues manually without a DIN on account of reason/reasons given in para 3(i)/3(ii)/3(iii)/3(iv)/3(v) of the CBDT Circular No. ...dated ..... (strike off those which are not applicable) and with the approval of the Chief Commissioner / Director General of Income Tax vide number .... dated .... "

4. Any communication which is not in conformity with Para-2 and Para-3 above, shall be treated as invalid and shall be deemed to have never been issued.

5. The communication issued manually in the three situations specified in para 3- (i), (ii) or (iii) above shall have to be regularised within 15 working days of its issuance, by -

i. uploading the manual communication on the System.

ii. compulsorily generating the DIN on the System;

iii. communicating the DIN so generated to the assessee/any other person as per electronically generated pro-forma available on the System.

6. An intimation of issuance of manual communication for the reasons mentioned in para 3(v) shall be sent to the Principal Director General of Income-tax (Systems) within seven days from the date of its issuance.

7. Further, in all pending assessment proceedings, where notices were issued manually, prior to issuance of this Circular, the income-tax authorities shall identify such cases and shall upload the notices in these cases on the Systems by 31th October, 2019.

Tags : Allotment Notice Issuance

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Ministry of Chemicals and Fertilizers

13.08.2019

Law of Medicine

Monitoring of prices regarding fixation of ceiling price of the orthopaedic Knee Implants

MANU/CHFZ/0030/2019

In continuation to the notifications issued by National Pharmaceutical Pricing Authority, Department of Pharmaceuticals, Ministry of Chemical and Fertilizers vide S.O. 2668(E) dated 16th August, 2017 and S.O. 3987(E) dated 13th August, 2018 regarding fixation of ceiling price of the orthopaedic Knee Implants issued under Para 19 of the DPCO, 2013, it has been decided that the same may be monitored as per the provisions of Paragraph 20(1) of the DPCO, 2013. This order shall be applicable for the period of one year from 16th August, 2019 (i.e. up to 15th August, 2020), unless revised by another notification.

2. The ceiling prices for orthopaedic Knee Implants will be reviewed after a period of one year.

3. The notes (b) to (t) of the Notification S.O. 2668(E) dated 16th August, 2017 shall remain in force during the currency of this order.

Tags : Monitoring Ceiling price Fixation

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