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Dear Friends

Each one of us has some interesting lessons to share during these lockdown times. Not that there was no learning earlier. Just that we were too busy to stop by and observe. We thought we were ‘living it out’. Were we ? Perhaps not. We had allowed ourselves to be swept away in the swirl of events, even forgetting our own selves, our talents, our interests, our health & our relationships. The positive side-effect of COVID19 is that such hidden talents are surfacing albeit hesitantly, through songs, sketches, games, recipes, knitting, painting, photography, talks etc. Ms. Ashwini Hegde, one of our long term team members has sketched this beautiful piece. I never knew she had this artist hidden in her. The current situation has helped her rediscover herself and now she vows to spend a few hours every week sketching. Doing what we like best, apart from ‘working’ is the best therapy we deserve and should give ourselves !

You will be surprised that Work can also be therapeutic at times. Especially if you get back after a long period of rest due to lockdown, mourning, illness or joblessness. You value the availability of work even more just like you value rest and relaxation. As they say, you value something only when you lose it. This is what my servant maid and press-wallah (dhobhi) realised, being out of work for nearly 6 weeks. While they were itching to return to work, they had rusted so much by over-resting that for the initial few days they couldn’t work. Lakshmi said “Akka, I was tired and bored sitting at home but now after resuming work, I realise my body is not cooperating with me. I am unable to walk, bend and clean. Experiencing severe body pain”. Manogaran, the press-wallah said “Madam, the iron-box seems so heavy now that I am unable to lift it. My hands and feet are protesting”. Well, the only antidote to this malady is work, work, work. A few days into the week, both of them are

feeling better and happy, feeling wanted, feeling a sense of pride and self-esteem. While “All work and no play makes Jack a dull boy” is a popular adage, the current forced hiatus has also taught us that “All rest and no work makes Jack a rusted boy” ! Lets welcome Work during these times to rebuild our society – with care & responsibility that we are the trustees of Mother Earth. The way we live and work has changed. Let Responsible & Responsive Living be the New Normal !!

It is in this very spirit of continuing to read and keep ourselves abreast, that this 236th issue of Samhita brings you the updates during 1st to 15th May, 2020. One of our young staff members Mr. Ashwin Kamath who has confidently handled a few Convertible Note transactions for startups has penned his insights as an article titled “Convertible Note – a Boon for Startups”. Hope you will find it useful. Lets Excel in English is in the form of yet another conversation by Mr. Balaji, accredited British Council English Teacher.

For
any previous issues of Samhita and the
readers feedback, please
visit https://sharadasc.com/resource-center/

Happy Reading


Mom: I am quite impressed with the *go getting* nature of some of my students.

Me: It’s indeed surprising for me when you share the stories of some of those *determined* students.

Mom: Learning becomes a lot more interesting when we teach such *tenacious* students.

The highlighted words refer to the quality being mentally strong and not ready to give up.

Balaji Ramaswamy N

Mobile:
9741393539

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Article – “Convertible note-A boon for Start-ups”

Ashwin G K, Executive, has analysed Convertible Note in an easy to understand format with procedural aspects.

Open Article

MCA updates
AGM through VC or OAVM

Taking into consideration the difficulties faced by companies in holding AGM, MCA has notified that for the year 2020, companies can hold their AGM through Video Conference (VC) or other audio visual means (OAVM) subject to fulfilment of certain requirements as detailed in the Note. There are separate provisions w.r.t. companies where e-voting is applicable / opted for and where e-voting is not applicable in case of smaller companies / with lesser shareholders.

Companies which are unable to hold their AGM on or before 30.09.2020 adhering to the requirements specified in the Circular should file an application before RoC requesting extension of time for holding AGM.


Open General Circular No. 20/2020 dtd. 05.05.2020
Open Note

Extension of due date – Form NFRA-2

The due date for filing Form NFRA-2 for FY 2018-19 will be 210 days from deployment of the form on MCA.

Open General Circular No. 19/2020 dtd. 30.04.2020

Inclusion of name in data bank for Independent directors

Every individual is now required to apply for inclusion of his name in the data bank of Independent Directors within 7 months of appointment as an Independent director as against the earlier requirement of 5 months.

Open Notification No. G.S.R. 268 (E) dtd. 29.04.2020

Finance Ministry
Highlights of the announcements by the Finance Minister – 13.05.2020

On 13.05.2020, the Honourable Finance Minister of India Nirmala Sitharaman announced reliefs to support Indian Economy’s fight against COVID-19 as detailed in the Note.

The measures announced was focused on “Getting back to work” i.e. enabling employees and employers, businesses, especially Micro Small and Medium Enterprises (MSMEs) to get back to productio and workers back to gainful employment. Efforts to strengthen Non-Banking Finance Institutions (NBFCs), Housing Finance Companies (HFCs), Micro Finance Sector and Power Sector were also unfolded. Other than this, the tax relief to business, relief from contractual commitments to contractors in public procurement and compliance relief to real estate sector were also covered.


Open Press Note dtd. 13.05.2020
Open Press Note dtd. 13.05.2020 containing revised TDS & TCS rates
Open Note

SEBI updates
Relaxations for Rights Issue under ICDR regulations

Following temporary relaxations have been granted pertaining to Rights Issue opening up to 31.07.2020, under SEBI (Issue of Capital and Disclosure Requirements)
Regulations, 2018 (ICDR Regulations) in view of the COVID-19 pandemic for easing conditions related to raising capital:

  1. The abridged letter of offer, along with application form can be sent to the
    shareholders by electronic transmission at least 3 days prior to opening of the issue. Failure to dispatch the same through post / courier will not be treated as a violation. The same has also been clarified by MCA vide Circular No. 21/2020 dated 11.05.2020. All offer documents may be digitally signed.
  2. The newspaper advertisement which is required to be published 2 days before opening of the issue should in addition to the details mentioned under Regulation 86,
    contain details regarding the manner in which shareholders who have not been served
    notice electronically may apply. The advertisement should also be made available
    on the website of the Issuer, Registrar, Lead Managers, and Stock Exchanges as well
    as through television channels, radio, internet etc.
  3. Currently, only Shareholders holding shares in dematerialised form can apply for
    Rights issue. However, shareholders who were unable to dematerialise their shares may be allowed to apply for shares under Rights Issue subject to fulfilment of certain conditions mentioned in the Circular.
  4. Currently, application for a rights issue can be made only through ASBA (Applications Supported by Blocked Amount) facility. Companies are now allowed to institute an additional optional mechanism (non-cash mode only) to accept applications of shareholders. An FAQ, online investor helpdesk, and helpline should be created by
    the issuer to help familiarize the shareholders with the application process.
Open Circular No. SEBI/HO/CFD/DIL2/CIR/P/2020/78 dtd. 06.05.2020


SEBI (LODR) Relaxations – COVID-19

In view of COVID-19, Vide Circular dated 12.05.2020 following addition relaxations have been granted for listed entities:

  1. Requirement of sending physical copies of annual report to shareholders – relaxed for companies having listed Non-Convertible Debentures (NCDs) and Non-convertible Preference Shares (NCPRs) and for listed entities holding AGM through VC or OAVM in the year 2020.
  2. Companies holding AGM through VC or OAVM during the year 2020 need not provide shareholders an option to appoint a proxy.
  3. LODR prescribes issuance of ‘payable at par’ warrants or cheques in case it is not possible to use electronic modes of payment. However, companies are now allowed to dispatch the dividend through post once the postal service is normalised.
  4. Relaxation was granted to companies having listed NCPRs and NCDs from publication of advertisements in newspapers, as required under regulation 47 for all events till 15.05.2020. The same has been extended for all events till 30.06.2020.
  5. Listed entities which are banking / insurance companies or having subsidiaries which are banking/ insurance companies may submit consolidated financial results for the quarter ending 30.06.2020 on a voluntary basis.
Open Circular No. SEBI/HO/CFD/CMD1/CIR/P/2020/79 dtd. 12.05.2020

GST updates
Form GSTR-3B – filing through e-verification code & SMS based OTP

Vide Notification No. 38/2020 dated 05.05.2020, CBIC has notified that:

  • The Registered Person registered under the provisions of Companies Act, 2013 will be allowed to file Form GSTR-3B through electronic verification code during the period 21.04.2020 to 30.06.2020.
  • A Registered person is allowed to file NIL returns through Form GSTR-3B for a tax
    period through SMS based on OTP.
Open Notification No.38/2020 dtd. 05.05.2020

RPs & IRPs to be treated as Distinct Persons

Currently, where a Resolution Professional (RP)/ Interim Resolution Professional (IRP) is appointed under the IBC, 2016, they shall be treated as distinct person of the corporate debtor and shall be liable to take new GST registration, within 30 days in all the States and Union Territories where the corporate debtor was registered earlier. However Notification dated 05.05.2020 permits taking a new GST registration within 30 days of appointment as RP/ IRP or on or before 30.06.2020 whichever is later.

The special procedure under GST notified via CGST Notification number 11/2020 dated 21.03.2020 shall not apply to those corporate debtors who have already filed GSTR-1 and GSTR-3B returns for all the tax periods prior to the appointment of the IRP/RP.

Open Notification No. 39/2020 dtd. 05.05.2020

Extension of validity of e-way bills

It has been notified that any e-way bill generated on or before 24.03.2020 and expiring between 20.03.2020 and 15.04.2020 will remain valid till 31.05.2020.

Open Notification No. 40/2020 dtd. 05.05.2020

Extension of due date – Form GSTR-9 and GSTR-9C

The due date for filing Form GSTR-9 and GSTR-9C for FY 2018-19 has been extended up to 30.09.2020.

Open Notification No. 41/2020 dtd. 05.05.2020

IT updates
Relaxations in Residential status

Due to COVID 19, the following relaxations have been made in computing the number of days’ stay in India of a person for the purpose of determining his Residential status under the Income Tax Act:

If an Individual has come to India on a visit before 22.03.2020 and:

  • Is unable to leave on or before 31.03.2020 the period of stay from 22nd March to 31st March need not be taken into account.
  • Has been quarantined on or after 01.03.2020 and has departed on an evacuation flight on or before 31.03.2020 or is unable to leave India on or before 31.03.2020, the period of stay from the beginning of his quarantine until the date of departure or 31.03.2020 shall not be taken into account.
  • Has departed from India on or before 31.03.2020, the period of stay in India from 22.03.2020 to the date of departure shall not be taken into account.

Open Circular No. 11 of 2020 dtd. 08.05.2020

Note:The contents of this Newsletter are only a summary and has not dealt with any issue in detail. Any action taken or proposed to be taken must be in consultation with professionals and not merely based on the articles / news updates. S. C. Sharada & Associates disclaims all liability on action taken without professional advice.

S. C. Sharada & Associates,
Company Secretaries. #405, 7th Cross, IV Block, Koramangala, Bangalore – 560 034.
sharadasc.com Phone :+91 80 25534374 , +91 80 25536618 Email:
[email protected]

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