Ministry of Finance 

25.01.2023

Direct Taxation

Central Government specifies California Public Employees Retirement System as the specified person for the purposes of section 10(23FE) of IT Act

MANU/CBDT/0002/2023

In exercise of powers conferred by sub-clause (iv) of clause (c) of the Explanation 1 to clause (23FE) of section 10 of the Income-tax Act, 1961 (43 of 1961) (hereinafter referred to as the "Act"), the Central Government hereby specifies the pension fund, namely, the California Public Employees Retirement System (PAN: AAATC6038J), (hereinafter referred to as "the assessee") as the specified person for the purposes of the said clause in respect of the eligible investment made by it in India on or after the date of publication of this notification in the Official Gazette but on or before the 31st day of March, 2024 (hereinafter referred to as the "the said investments") subject to the fulfillment of the following conditions, namely:-

1. (i) the assessee shall file return of income, for all the relevant previous years falling within the period beginning from the date in which the said investment has been made and ending on the date on which such investment is liquidated, on or before the due date specified for furnishing the return of income under sub-section (1) of section 139 of the Act;

(ii) the assessee shall furnish along with such return a certificate in Form No. 10BBC in respect of compliance to the provisions of clause (23FE) of section 10 of the Act, during the financial year, from an accountant as defined in the Explanation below sub-section (2) of section 288 of the Act, as per the provisions of clause (vi) of rule 2DB of the Income -tax Rules, 1962;

(iii) the assessee shall intimate the details in respect of each investment made by it in India during the quarter within one month from the end of the quarter in Form No. 10BBB, as required under clause (v) of rule 2DB of the Income-tax Rules, 1962;

(iv) the assessee shall maintain a segmented account of income and expenditure in respect of such investment which qualifies for exemption under clause (23FE) of section 10 of the Act;

(v) the assessee shall continue to be regulated under the laws of the Government of the State of California, United States of America;

(vi) the assessee shall be responsible for administering or investing the assets for meeting the statutory obligations and defined contributions of one or more funds or plans established for providing retirement, social security, employment, disability, death benefits or any similar compensation to the participants or beneficiaries of such funds or plans, as the case may be;

(vii) the earnings and assets of the assessee should be used only for meeting statutory obligations and defined contributions for participants or beneficiaries of funds or plans referred to in clause (vi) and no portion of the earnings or assets of the pension fund inures any benefit to any other private person; barring any payment made to creditors or depositors for loan or borrowing as defined in sub-clause (b) of clause (ii) of Explanation 2 to clause (23FE) of section 10 of the Act, taken for the purposes other than for making investment in India;

(viii) the assessee shall not have any loans or borrowings as defined in sub-clause (b) of clause (ii) of Explanation 2 to clause (23FE) of section 10 of the Act, directly or indirectly, for the purposes of making investment in India;

(ix) the assessee shall not participate in the day to day operations of investee as defined in clause (i) of Explanation 2 to clause (23FE) of section 10 of the Act, but the monitoring mechanism to protect the investment with the investee including the right to appoint directors or executive director shall not be considered as participation in the day to day operations of the investee; and

(x) the said investments of the assessee shall be held for at least three years as required under sub-clause (ii) of clause (23FE) of section 10 of the Act.

2. Violation of any of the conditions stipulated in clause (23FE) of section 10 of the Act and this notification shall render the assessee ineligible for the tax exemption.

3. This notification shall come into force from the date of its publication in the Official Gazette.

Tags : Specified person Eligible investment Notification

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Reserve Bank of India

25.01.2023

Banking

RBI releases discussion paper on Securitisation of Stressed Assets Framework (SSAF)

MANU/RPRL/0057/2023

As part of the Statement on Developmental and Regulatory Policies released on September 30, 2022, RBI had proposed to introduce a framework for securitisation of stressed assets, in addition to the ARC route. It was announced that a discussion paper detailing relevant contours of the proposed framework would be issued shortly. Accordingly, RBI has today released the Discussion Paper on SSAF inviting comments from stakeholders.

The Discussion paper broadly covers nine relevant areas of the framework including asset universe, asset eligibility, minimum risk retention, regulatory framework for special purpose entity and resolution manager, access to finance for resolution manager, capital treatment, due diligence, credit enhancement, and valuation. It draws upon similar frameworks introduced in other jurisdictions, while trying to keep it structurally aligned with the framework for securitisation of standard assets.

Comments may be submitted by February 28, 2023 to The Chief General Manager, Credit Risk Group, Department of Regulation, Central Office, Reserve Bank of India, 12th Floor, Central Office Building, Shahid Bhagat Singh Marg, Fort, Mumbai - 400001, or by e-mail with the subject line "Discussion Paper on Securitisation of Stressed Assets Framework (SSAF)".

Tags : Discussion Release SSAF

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Reserve Bank of India

25.01.2023

Banking

Extension of validity of Directions under Section 35A of the Banking Regulation Act, 1949 (AACS)- Indian Mercantile Co-operative Bank Ltd., Lucknow (U.P)

MANU/RPRL/0058/2023

The Reserve Bank of India (RBI) has extended the directions issued to the Indian Mercantile Co-operative Bank Ltd., Lucknow (U.P) for a period of three (03) months from January 28, 2023 to April 27, 2023, subject to review. The bank has been under direction since January 28, 2022 vide directive order DOS.CO.OCCD/185569/12.28.007/2021-22 dated January 28, 2022 issued under section 35A read with section 56 of the Banking Regulation Act, 1949 (AACS).

The validity of the directive, which was issued up to January 27, 2023 has been extended for a period of three (03) months from January 28, 2023 to April 27, 2023 vide directive order DOR.MON.No.D-65/12.28.007/2022-23 dated January 25, 2023 subject to review. A copy of the directive order dated January 25, 2023 is displayed at the bank's premises for the perusal of public.

The issue of the above Directions by the RBI should not per se be construed as cancellation of banking license by RBI. The Reserve Bank may consider modifications of these Directions depending upon circumstances.

Tags : Extension Validity Directions

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Securities and Exchange Board of India

25.01.2023

Capital Market

SEBI underlines the need for analysis and disclosure of risks of trading in F&O

MANU/SPRL/0002/2023

Under the supervision of a working group, SEBI has conducted a study analysing the trends in both participation and in profits and losses of individual traders in the equity F&O segment. The working group had representation from academia, clearing corporations, brokers, and market experts.

To compare results in a contextual manner before and after the pandemic, the study covers the periods of FY 2018-19 and FY 2021-22. The study is based on a sample of all individual clients of all the top-10 stock brokers, accounting for 67% of the overall individual client turnover in the equity F&O segment during FY 2021-22.

Some of the major findings of the study are as under:

• There has been a significant increase of over 500% in the number of individual traders in the equity F&O segment in FY 2021-22, as compared to FY 2018-19.

• 98% of individual traders in the equity F&O segment traded in options during FY 2021-22.

• 9 out of 10 individual traders in the equity F&O segment incurred net losses during both the years FY 2018-19 and FY 2021-22.

• On average, loss makers registered net trading loss close to Rs 50,000 in FY 2021-22. The average absolute net loss of a loss maker was over 15 times the net profit made by a profit maker.*

• Over and above the net trading losses incurred, loss makers expended an additional 28%* of net trading losses as transaction costs.

• Those making net trading profits incurred between 15% to 50%* of such profits as transaction cost.

SEBI believes that periodic data analysis and disclosure of this nature can significantly enhance investor awareness around market risks. With this in mind, SEBI will shortly issue guidelines in respect of additional risk disclosures required to be made by brokers and exchanges to investors.

Tags : Disclosure Risks Trading

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Ministry of Commerce and Industry

23.01.2023

Commercial

Clarification regarding Implementation of Paper Import Monitoring System (PIMS)

MANU/DGFT/0010/2023

1. Import of products under Chapter 48 (total 201 tariff lines) of Schedule-I (Import Policy) of ITC (HS), 2022 are permitted subject to compulsory registration under Paper Import Monitoring System (PIMS), vide DGFT Notification No. 11/2015-20 dated 25th May, 2022.

2. Various representations have been received in DGFT from trade & industry seeking clarification on the applicability of the said Notification dated 25th May, 2022 in certain situations. The matter has been examined in consultation with the Department of Commerce (DoC) and Department for Promotion of Industry and Internal Trade (DPIIT). Accordingly, the issues raised and responses thereto are given below:

(i) Whether imports through Air mode are exempted from Registration from PIMS?

Response: In Paper, there are no small volume/high value goods on which Air-Cargo is justified. Therefore, registration under PIMS shall be mandatory regardless to mode of transportation.

(ii) Whether import of samples of paper is exempted from Registration from PIMS?

Response: Import consignment of samples for FOB value of Rs. 10,000/- irrespective of quantity, shall be exempted from requirement of compulsory registration under PIMS.

(iii) Can returnable paper items imported on temporary import be exempted from PIMS registration and given fee waiver?

Response: Since Paper products are not small volume/high value goods, therefore, registration under PIMS shall be compulsory regardless to the purpose of imports of paper products.

(iv) Whether registration from PIMS is exempted for import under common IEC by individuals and Government agencies?

Response: Registration under PIMS shall be compulsory for imports of all notified paper products. However, exemption from PIMS can be considered for non-commercial import under common IECs by individuals and Govt., agencies on case to case basis, in terms of Para 2.58 of the Foreign Trade Policy.

(v) Will PIMS be applicable to imports through Advance Authorisation, DFIA and ICGR?

Response: PIMS shall be mandatory regardless to the purpose of the imports of paper products under any scheme (Advance Authorization/IGCR/EOU/SEZ etc.).

(vi) Whether PIMS Registration is required both at the point for import into SEZ/ FTWZ and at the time of Customs Clearance from SEZ to DTA? Whether registration is required for EOUs as well at the time of import by an EOU?

Response: PINTS- Registration shall be required at the point of import by a Unit in SEZ/FTWZ or at the time of import by an EOU of the items covered under PIMS.PIMS Registration shall not be required by the DTA Unit at the time of Customs Clearance from the SEZ/FTWZ/EOU to DTA if no processing has taken place of the item of paper that has already been registered under PIMS at the time of entry into a SEZ/FTWZ/EOU. However, if processing has taken place in the SEZ/FTWZ/EOU with change in HS Code at 8-Digit level, then the importer in DTA will require to register under PIMS, if the processed item falls under any of the tariff

This issues with the approval of competent authority.

Tags : Clarification Implementation PIMS

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Press Information Bureau

23.01.2023

Commercial

Shri Piyush Goyal asks businesses to adopt a sustainable and green approach in business practices

MANU/PIBU/0145/2023

Union Minister of Commerce and Industry, Consumer Affairs, Food and Public Distribution and Textiles, Shri Piyush Goyal asked businesses to adopt a sustainable and green approach in business practices. He asked them to use the forum of B20 along with G20 to look at how we can collectively work towards a sustainable and equitable future agenda. He was addressing the Inception Meeting of Business 20 (B20), the official G20 dialogue forum with the global business community in Gandhinagar today.

Shri Goyal paid his tributes to Netaji Subhash Chandra Bose on his birth Anniversary today and said that he was one of the leading lights of our freedom struggle. The Minister said that Netaji envisioned a nation where every single citizen of the nation had a share in its prosperity.

The Minister applauded the Prime Minister Shri Narendra Modi's vision of 'Vasudhaiva Kutumbakam', of peace and dialogue, orderly and inclusive growth and humane approach and said that India wanted to be a responsible global citizen, be it in the sphere of climate change or digital public infrastructure. Shri Goyal said that through the theme of G20 in India- 'one earth one family one future' - we wished to inspire the world to care for each other, to have a greater degree of dialogue and greater concern for the planet and the future of our children.

Quoting Mahatma Gandhi, he said that we had inherited this world as trustees and it is our duty to leave behind a better world for next generation. We have to respect intergenerational equity- we do not have the right to use up all the resources of this planet, he added.

The Minister highlighted that India had always stood for sustainable development. He mentioned that it was one of the top 5 countries in the world in terms of adopting and implementing environmental goals. India regularly files UNFCCC report and has already exceeded its goal for 2030, of having a 40 percent share of renewable energy in its installed capacity in 2021. India takes each sustainable development goal very seriously, he said.

Speaking of India's amazing journey of growth, Shri Goyal said that India had grown almost 12 times in the last three decades inspite of several black swan events. He added that transformational steps had been taken by the government to take inclusive growth to every section of society without discrimination and to the remotest corners of the nation.

The Minister noted that the Prime Minister had relentlessly focussed on 4 'I's of investment in infrastructure, integrity, inclusive development and international outlook to lend wings to Indian economy. He spoke of some of the transformational initiatives of the government. He said that the Digital India Mission had ensured that the levels of connectivity we have in telecom today and what is being planned over the next 2 years would catapult us to amongst the top 5 or 6 countries in terms of technology. It will help us achieve inclusive economic growth smartly.

He stressed that the government had succeeded in securing the basic needs of life such as food, shelter, clothing, education, healthcare etc. to people, enabling, empowering and inspiring them to aspire for the better things in life. He noted that even during the heights of the pandemic, no death due to starvation had taken place in the country, thanks to several government initiatives including the mission to provide more than adequate foodgrains to almost 800 million across the country. He underscored that India had the world's largest and successful free healthcare program, covering 500 million people. He said that 35 million families who were at the bottom of the pyramid, who were the most deserving, yet the most deprived, have been given homes with all the basic amenities. He added that the government had also succeeded in raising farmers' income.

Shri Goyal noted that the while the world was worried about how India would cope with the pandemic, it had converted that fear into hope and emerged as a bright spot in the global economy. No other market in the world as large as the India opportunity today, he said and added that India hoped to power the world economy through collaborations and cooperation amidst competition and asked both Indian and foreign companies to serve the world using India as the base.

The Minister said that businesses that come to India have always succeeded because of our competitiveness. He opined that India offered the rule of law, inspiring and decisive leadership, transparent government policies, no opaque models and no hidden subsidies. He cited the example of a British Company that was manufacturing in UK, supplying to a few countries, and achieving a modest turn over. A few years ago, this company set up manufacturing in India and due to the competitiveness of Indian manufacturing and our ability to launch newer products through design and innovation, the company now supplies products to over 110 countries around the world from India at affordable and competitive prices, he said. He also spoke of another tech-giant which already has 5-7 percent of manufacturing happening in India and plans to scale it upto 25 percent.

He expressed hope that by August, we would have a robust framework for B20 and we succeed in taking a message of responsibility, care and concern, a message of togetherness and oneness, a message that we will all work together for a better future for our children, from India to the world.

India assumed the Presidency of the G20 from 1 December, 2022. G20 is a premier forum for international economic cooperation. Established in 2010, B20 is among the most prominent Engagement Group in G20, with companies and business organizations as participants. B20 leads the process of galvanizing global business leaders for their views on issues of global economic and trade governance and speaks in a single voice for the entire G20 business community.

B20 will operate through 7 Task Forces and 2 Action Councils entrusted to develop consensus-based policy recommendations to the G20.

Shri Ashwini Vaishnaw, Minister of Railways, Communications and Electronics & Information Technology; Shri Amitabh Kant, G20 India Sherpa and Shri N. Chandrasekaran, Chairman Tata Sons, who is the Chair of B20 India, Shri Anurag Jain, Secretary, DPIIT, Ministry of Commerce and Industry and other dignitaries were present at the gathering. More than 200 overseas delegates including CEOs and business executives, from G20 member countries and invitee countries apart from more than 400 delegate from within the country took part in the B20 India Inception Meeting.

B20 deliberations would see discussions on broad areas of climate action, innovation, digital global cooperation, resilient global value chains, fostering financial inclusion, empowering societies etc. The B20 Inception Meeting will culminate on 24 January, 2023.

Tags : Green approach Business practices

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