The Company Law Committee- 2019 submitted its report to the Finance Minister on 18^th November, 2019 with significant recommendations regarding compoundable offences, fines, penalties, additional fees etc. payable by companies, lower additional fees by OPCs, Small companies, Producer companies and Start-ups as well as higher threshold for CSR applicability. All this in the name of “Ease of living for Corporates” and de-clogging the Criminal justice System!

A complete report as well as a summary brought out by Press Information Bureau of India can be referred to.

The labour department of Government of Karnataka has made significant changes to the Karnataka Shops and Commercial Establishments Act, 1961 to permit all establishment having more than 10 employees to be open on 24 x 7 basis on all days of the year subject to certain conditions.

• Women can now work from 8:00 p.m. to 6:00 a.m. provided her transport and safety is ensured by the employer.
• Every employer having a woman employee must constitute a Prevention of Sexual Harassment Committee and keep it operative.

Above changes will be valid for 3 years from the date of gazette notification i.e. 11.10.2019.

The following Rules and Regulations have been notified by MCA:

1. The Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019 w.e.f. 15.11.2019.
• These rules shall apply to such financial service providers or categories of financial service providers, as may be notified by the Central Government under section 227 of IBC, from time to time, for the purpose of their insolvency and liquidation proceedings. One of the categories notified is NBFCs including Housing Finance Companies with asset size of Rs.500 crores or more and RBI is the notified regulator.
• “Resolution Professional” / “Interim Resolution Professional” / “Insolvency Professional” is replaced with “Administrator” and “Corporate Debtor” is replaced with “Financial Service Provider”.
• The Corporate Insolvency Resolution Process, Liquidation Process and Voluntary Liquidation Process of the corporate debtor under IBC, shall mutatis mutandis apply, to the Insolvency Resolution Process, Liquidation Process and Voluntary Liquidation Process of a Financial Service Provider subject to certain modifications.
2. The Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Regulations, 2019 and The Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019 shall come into force on 01.12.2019.

Under the above Rules and Regulations, Guarantor has been defined as “a Personal Guarantor to a Corporate Debtor in respect of whom guarantee has been invoked by the creditor and the amount remains unpaid in full or in part”. They are intended to help banks/ creditors to recover from defaulting guarantors within a given time frame under the IBC, which was earlier difficult due to delayed legal proceedings. The rules and regulations relating to Personal Guarantors will have a significant influence in the recovery of dues and will hopefully help fuel the sagging economy.

Section 194M has been inserted in the last Union Budget to provide for levy of TDS at the rate of 5% on the sum paid or credited in a year on account of contractual work (including supply of labour for carrying out any work) or professional fees by an individual or a HUF (other than those who are required to deduct income-tax as per the provisions of section 194C or section 194J), if aggregate of such sums exceeds Rs. 50 lakhs in a year. However, in order to reduce the compliance burden, it is proposed that such individuals or HUFs can deposit the tax deducted using their PAN and shall not be required to obtain TAN. This amendment takes effect from 1^st September 2019. The tax deducted must be paid within 30 days from the end of the month in which the deduction was made and shall be accompanied by a challan cum statement in form 26QD. The relative certificate of deduction shall be issued in Form 16D within 15 days of furnishing form 26QD.

CBIC has extended the last date for furnishing of annual return/reconciliation statement in Form GSTR-9/Form GSTR-9C for FY 2017-18 till 31^st December, 2019 and for FY 2018-19 till 31^st March, 2020.

Annual Return GSTR-9 & GST Audit GSTR-9C have been simplified vide Central Goods and Services Tax (Seventh Amendment) Rules, 2019. Two significant changes in form GSTR-9C are that instead of true and correct now it specifies to give true and fair view and Cash flow statements to be reported only if available so all non-corporates would be relieved of such reporting requirements.

The CBIC has issued a clarification regarding the optional filing of Annual returns of taxable persons whose turnover does not exceed Rs. 2 crores. The summary is as follows:

• Taxable persons who have for opted for Composition Scheme, must file Form GSTR-9A. However as per the notification dated 9^th October 2019, it is optional for them to file the Annual returns for FY 2017-18 and 2018-19 respectively.
• Similarly, in the case of taxable persons having aggregate turnover less than Rs. 2 crores, annual returns are optional and can only be filed before the due date.

Earlier, after roll out of GST w.e.f. 01.07.2017, as per temporary mechanism applicants were required to file the refund application in FORM GST RFD-01A on the common portal, take a print out of the same and submit it physically to the jurisdictional tax office along with all supporting documents. 

Later, to make process of submission of the refund application electronic it was specified that the refund application in FORM-GST-RFD-01A, along with all supporting documents, shall be submitted electronically. However, various post submission stages of processing of the refund application continued to be manual. 

Finally, refund procedure was made fully electronic and was deployed on the common portal with effect from 26.09.2019.

Now the CBIC, has issued a Circular laying down procedure for electronic submission and processing of refund applications in supersession of all earlier circulars on the subject.

• The Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019 w.e.f. 15.11.2019.

• Persons whose principal place of business or place of business lies in the erstwhile State of Jammu and Kashmir till the 30.10.2019; and now lies in the Union territory of Jammu and Kashmir or in the Union territory of Ladakh from the 31.10.2019 onwards, have been classified as a class of persons who shall follow a special procedure till 31.12.2019 as detailed in the Notification. This relates to tax period, availing Input Tax Credit, filing of returns etc.