“Specified companies” are companies who procure supplies of goods or services from Micro and Small Enterprises (MSME) and whose payments to them exceed 45 days from the date of acceptance or the date of deemed acceptance of the goods or services.

Specified Companies (Furnishing of information about payment to micro and small enterprise suppliers) Order, 2019 has been notified with effect from 22nd January, 2019 requiring such Specified Companies to file with the MCA:

– Details of outstanding dues (45 days and beyond) to MSME suppliers existing on the date of notification of this order within 30 days from 22^nd January, 2019 in MSME Form I.
– Details of outstanding dues (amount and reasons for delay) on a half-yearly basis i.e., by 31^st October for April – September and by 30^th April for October – March.

The Ministry of Corporate Affairs (MCA) has re-introduced the concept of Commencement of Business Certificate. All companies having a share capital incorporated on or after 2^nd November, 2018 (Effective date of the Companies (Amendment) Ordinance, 2018) have to obtain this Certificate by filing Form INC-20A.

Each Director of the company is to give a declaration stating that every subscriber to the MoA has paid the value of shares agreed to be taken by him / her on the date of making such declaration, which is to be filed along with INC-20A.

The Certificate is to be obtained within 180 days from the date of Incorporation of such a company. If not, the Company is liable to pay a penalty of INR 50,000 and each of the Directors are liable to pay a penalty of INR 1,000/ day upto a maximum of INR 1 lakh.

If no declaration has been filed in Form INC-20A and the RoC has reasonable cause to believe that the company is not carrying on business, then he / she may initiate strike off proceedings.

Companies (Prospectus and Allotment of Securities) Amendment Rules, 2019 effective from 22^nd January, 2019, exempt Nidhi / Government / wholly owned subsidiary companies from complying with the rules relating to issue of securities in dematerialised form by unlisted public companies.

The National Company Law Tribunal (Amendment) Rules, 2019 have been notified with effect from 15^th January, 2019.

An application for obtaining approval of the Tribunal for the consolidation and division of all or any of the share capital into shares of a larger amount than its existing shares which results in changes in the voting percentage of shareholders is to be advertised by the Company at least 14 days before the date of hearing.

The Company is to now serve a notice with copy of the application and objection if any, by affected persons to the Regional Director, as against previously to the Central Government.

DIPP has modified the notification dated 11^th April, 2018 with respect to eligibility of Startups and investors as also the procedure for claiming Angel Tax exemption. Startups can make an application under the new notification to claim exemption even for past investments subject to meeting the criteria.

In case approval is required for the shares already issued by the start –up , no application is required if assessment order has been passed by the assessing officer for the relevant FY. The notification effective from 16^th January, 2019 will be valid untill reviewed before 31^st March, 2021 by the Government.

The Reserve Bank of India (RBI) has revamped the entire External Commercial Borrowings (ECBs) framework. The following are a few highlights of this extensive notification:

– Merging of Tracks: Merging of Tracks I and II as “Foreign Currency denominated ECB” and merging of Track III and Rupee Denominated Bonds framework as “Rupee Denominated ECB”.
– Eligible Borrowers: All entities eligible to receive FDI are Eligible Borrowers. Additionally, Port Trusts, Units in SEZ, SIDBI, EXIM Bank, registered entities engaged in micro-finance activities, viz., registered not for profit companies, registered societies/trusts/cooperatives and non-government organisations can also borrow under this framework.
– Recognised Lender: The lender should be resident of FATF or IOSCO compliant country.
– Minimum Average Maturity Period (MAMP):

✔ MAMP will be 3 years for all ECBs.
✔ MAMP for ECB raised from foreign equity holder and utilised for specific purposes will be 5 years.
✔ ECB up to USD 50 million per financial year raised by manufacturing sector will be 1 year.

– Late Submission Fee (LSF) for delay in Reporting: Any borrower, who is otherwise in compliance of ECB guidelines, except for delay in reporting drawdown of ECB proceeds before obtaining LRN or Form ECB 2 returns, can regularize the delay by payment of LSF as per the laid down procedure.

The notification is to be read in detail for specific clarifications / answers.

Foreign Exchange Management (Establishment in India of a branch office or a liaison office or a project office or any other place of business) (Amendment) Regulations, 2019 has been notified and is effective from 21st January, 2019.

Approval of RBI is not required if Government approval / license / permission by the concerned Ministry / Regulator has been granted.

If a Non Resident Applicant has entered into a contract / agreement with the Ministry of Defence or Service Headquarters or Defence Public Sector Undertakings then no separate reference / approval is required from the Central Government.