Snow clad mountains | Golden hue of the sun rays gently kissing them | Sometimes clear | Sometimes engulfed in pristine white clouds, caressing the slopes | Contrasted by the tall green pines alongside the gurgling river flowing by | Add to this feast for the eyes, the constant cheerful, chirping of the birds in different pitches….wow what a feast to the ears, away from the dust and din of the cities. It is a sensory experience which cannot be viewed in videos and pictures. Must be savoured first hand to appreciate nature which is truly heaven on earth ! Here are some takeaways / observations from my recent trip to a few places in the valleys of Himachal Pradesh :
Gentle, courteous people like the soothing mountain environment. They live in tough conditions but serve with a smile. Amazing hospitality at 10,000 ft. above sea level.
Clean, hygienic, eco-friendly and sustainable living.
Kathkuni (kasth & kona i.e. wood + corner) structure – preserving traditional heritage architecture of Himachal that uses only stone and wood. The structure is both cool as well as cosy.
Mountain roads are treacherous that teach us patience and dexterity. Fortunately we had a matured driver who always yielded and gave way to the oncoming vehicle, every single time. We hardly do it in cities and are in a tearing hurry to zip past ahead, resulting in traffic jams and accidents.
As serene as it may seem, there is uncertainty and severity – sudden weather changes, unexpected downpours, lashing winds, turns and bends on the road, landslides and more.
Diversity galore – calming rivers, gushing falls, whispering woods, floating clouds, melting snow, mild sunlight, heavy winds – all of which can be experienced in a single day.
Found the mountain people hard working but quite contented with minimal or no greed – no chasing of tourists, marketing of their ware. We could enjoy the stay at peace.
People living for 100+ years thanks to chemical free farming, eating farm fresh produce, drinking untreated clean water and walking for long miles in the mountain ranges.
Entreprenurial spirit that has propelled many affordable and comfortable home stays.
Smaller and cosier places promote friendliness and camaraderie – tourists from all over the country were open to greet each other, sing and eat together, give tips and lend a helping hand. How badly we miss this in urban areas ! Large living spaces but constricted hearts !!
As I said, it is to be seen and experienced to be believed. I fall short of words to describe the bounty of mother nature in the majestic mountains. At the same time, the lifestyle in the mountains reminds us of our basic responsibility to “Live and let live”.
Finally I had to descend to ground level from the heavenly abode of ‘Dev Bhoomi’ to share this 276th issue of Samhita which carries the regular updates, statutory calendar reminder and some English language tips. For any previous issues of Samhita and the readers feedback, please visitour website.
Adjectives for different personalities
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A sample email when you have to confront
Hi ………….., I would like to bring to your notice that we have not been able to serve our customers to their satisfaction due to misses and gaps from ABC’s side. We had already written to you about this, but I am afraid there hasn’t been any change in the functioning of operations. This has had a huge impact on our business. We don’t want to lose the trust of our customers due to ABC’s inefficiencies. I trust you would urge your team to consider this matter seriously and work in accordance with the agreed terms without any deviations, particularly in terms of adhering to the deadlines.
Sample promotional message
Here’s the one stop place for grammar for workplace, vocabulary for workplace, fluency techniques, email writing and presentation skills on Balaji Ramaswamy’sYouTubechannel.
The Indian Computer Emergency Response Team (CERT-In) is the national agency administered with the responsibility of dealing with Cyber Security incidents in India. It has the power to call for information and issue directions to service providers, intermediaries, data centres, body corporate and any other person for carrying out the responsibilities assigned to it.
CERT-In has issued new set of directions on 28th April, 2022 to strengthen cyber security in the country which shall come into force w.e.f 26th June, 2022. One of the highlights of the directions is reporting of cyber incidents within 6 hours of noticing such incidents. In order to help the stakeholders to understand the nuances of the directions, CERT-In has released FAQs on the directions.
The FAQs deal with basic terminologies, scope of the directions, clarifications about directions issued and explains the types of cyber security incidents to be reported.
Companies (Share Capital and Debentures) Amendment Rules, 2022
The instrument of transfer of securities Form SH-4 has been amended vide notification dtd 04th May, 2022. A declaration that either the transferee is required to obtain or not required to obtain prior government approval as prescribed under the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019 has been added in the form SH-4.
Companies (Prospectus and Allotment of Securities) Amendment Rules, 2022
Two amendments have been made to Rule 14 of Companies (Prospectus and Allotment of Securities) Rules, 2014 vide MCA Notification dtd 05th May, 2022. They are as follows: –
No offer under private placement shall be made to a body corporate incorporated in, or a national of, a country which shares a land border with India unless such body corporate or the national has obtained prior approval from the Government under Foreign Exchange Management (Non-Debt Instruments) Rules, 2019. Such approval is required to be attached to the private placement offer cum application letter (PAS-4).
Amendment to form Part-B of PAS-4: – the requirement to obtain such prior government approval or not for investment has to be selected in the applicable check box.
Prior approval under FEMA was in existence since 2020 but now the requirement has been synchronized with the provisions under the Companies Act, 2013 through the documentation.
Clarification for holding of AGM through VC up to 31.12.2022
In reference to its General Circular no. 20/2020 dtd 05.05.2020 and General Circular no. 02/2022 dtd 13.01.2021 and General Circular no 19/2021 dtd 08.12.2021, MCA vide General Circular no. 2/2022 dtd 05.05.2022 has clarified that companies whose AGMs are due in the year 2022 may conduct their AGMs on or before 31st December, 2022 through VC or OAVM. In the earlier circulars, MCA had allowed companies whose financial year ended on or before 31.03.2022 to conduct their AGM in 2022 through VC or OAVM up to 30th June, 2022. With the recent MCA circular dtd 05.05.2022 it is clear that companies following different financial year ie; Jan- Dec or any other period can also conduct their AGM which is due in 2022 through VC or OAVM.
Clarification for Holding of EGM through VC up to 31.12.2022
MCA vide its General Circular no. 3/2022 dated 05th May, 2022 has allowed companies to conduct their Extra-Ordinary General Meetings (EGM) through VC or OAVM or to transact items through postal ballot for a period up to 31st December, 2022 in accordance with the framework provided in its General Circulars issued during 2020 and 2021.
Companies (Incorporation) Second Amendment Rules, 2022
MCA vide Notification dtd 20th May, 2022 has notified the following amendments to the Incorporation Rules which shall come into effect from 01st June, 2022:-
The declaration by first subscribers and first directors to be given in Form No. INC- 9 has been amended to include check boxes for declaration regarding compliance of prior government approval stipulated under FEMA Non-Debt Instruments, Rules, 2019.
PART B of Form INC-32(SPICE+) has been amended to include an additional declaration regarding obtaining of security clearance where the person seeking appointment is a national of a country which shares a land border with India. If option yes has been selected a copy of the security clearance is also required to annexed to the form.
The MCA vide its General Circular no.04/2022 dated 27th May, 2022 has granted extension of timeline for filing Annual Return of Limited Liability Partnership in Form 11 LLP without additional fees up to 30th June, 2022.
The MCA vide its General Circular no. 6/2022 dtd 31st May, 2022 has granted extension of timeline for all the event based forms to be filed by LLPs for which the due date falls between 25th February, 2022 and 31st May, 2022 up to 30th June, 2022 without paying additional fees.
SEBI (Collective Investment Schemes) (Amendment) Regulations, 2022
‘Collective Investment Scheme’(CIS) is a scheme or arrangement made or offered by any company under which the contributions, or payments made by the investors are pooled and utilised with a view to receive profits, income, produce or property, and is managed on behalf of the investors. CIS is offered and managed by ‘Collective Investment Management Company’(CIMC). CIMCs are companies which are incorporated under the Companies Act, 1956 or the Companies Act, 2013 and registered with SEBI with the objective of organising, operating and managing a CIS. They are regulated by SEBI (Collective Investment Schemes) Regulations, 1999 (SEBI CIS Regulations). Gift Collective Investment Management Company Limited is India’s first and only CIMC registered with SEBI. SEBI has been actively monitoring compliance of the CIS regulations and have debarred several entities which have floated CIS without obtaining the necessary registration. In January, 2022 SEBI came out with a consultation paper on CIS and in furtherance of the same, SEBI has notified multiple amendments to the CIS Regulations through Notification dtd 10th May, 2022. Highlights of the amendments are as follows: –
1. Amendment to definition clauses- Certain definitions have been amended as follows: –
Prior to Amendment
“auditor” means a person qualified to audit the accounts of companies under the Companies Act, 1956;”
“auditor” means a firm, including a limited liability partnership, constituted under the Limited Liability Partnership Act, 2008, who is eligible and qualified to audit the accounts of a company under section 141 of the Companies Act, 2013 (18 of 2013);
No definition prior to amendment
“designated employees” of the Collective Investment Management Company includes: (i) chief executive officer, chief investment officer, chief risk officer, chief information security officer, chief operation officer, fund manager, compliance officer, sales head, investor relation officer, heads of other departments and dealer of the Collective Investment Management Company; (ii) persons directly reporting to the chief executive officer (excluding personal assistant/ secretary); (iii) fund management team and research team; (iv) other employees as identified by Collective Investment Management Companies or trustees.”
“fraud”, has the same meaning as is assigned to it in section 17 of the Indian Contract Act, 1872 (9 of 1872);
“fraud” means a fraud as defined in sub-clause (c) of sub-regulation (1) of regulation 2 of the Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003;
“relative” means a person who is a relative, as defined in section 6 of the Companies Act, 1956 (1 of 1956);
“relative” means a person as defined in section 2(77) of the Companies Act, 2013 (18 of 2013).
2. Conditions for eligibility – Earlier one of the eligibility conditions for the applicant (company) was that they should have a net worth of not less than Rs. 5 Crores or a minimum net worth of Rs. 3 Cores at the time of application which should be increased to Rs. 5 Cores within 3 years from grant of registration. The same has been substituted and a list of stringent sound-track-record requirements has been put in place among other eligibility conditions which existed previously.
3. Restrictions on Investment & Representation in another CIMC- Regulation 9B inserted for imposing the following restrictions:- a) CIMC or its promoter or their associates or group companies have been restricted from holding shareholding or voting rights of 10% or more individually or collectively, directly or indirectly in a CIMC or in the trustee company of another CIMC. Representation on the Board of a CIMC or trustee company of a CIMC has also been prohibited. b) A shareholder holding 10% or more of shareholding or voting rights in a CIMC or trustee company of CIMC shall not directly or indirectly hold 10% or more of shareholding or voting rights in another CIMC or trustee company of another CIMC. They shall not be entitled to be represented on the board of the CIMC or trustee company of another CIMC. Where such provisions have been breached incidentally as a result of merger, acquisition, scheme of arrangement or any other arrangement involving the promoters of CIMC, its shareholders or trustee companies, their group companies or associates, a period of one year from date of coming into force of such arrangement has been given to comply with the aforesaid restrictions.
4. Investment by designated employees- Investment by CIMC and its designated employees in schemes of the CIMC will be permitted as may be prescribed by SEBI. This restriction has been inserted as an additional obligation of the CIMC under Regulation 14.
5. Closure of Subscription List- Sub-regulation 6 inserted under Regulation 24 for imposing conditions to be satisfied upon closure of subscription list in the event of launch of CIS. (a) minimum subscription amount of Rs. 20 Crores; (b) minimum 20 investors; and (c) no person shall hold more than 25% of the assets under management of scheme: The application money will have to be refunded if there is a failure to comply with the aforesaid conditions.
6. Offer Period – Changed from not more than 90 days to not more than 15 days with maximum of additional 15 days with due public notice by CIMC before expiry of initial 15 days.
Relaxation from compliance with certain provisions of the SEBI LODR
Annual report to shareholders
SEBI vide its circular dtd 13th May, 2022 provided relaxation from compliance of certain provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI LODR) up to 31st December, 2022. The relaxations granted are as follows: –
Requirement under Regulation 36(1)(b) of SEBI LODR to send hard copy of annual report to the shareholders who have not registered their email addresses is dispensed with up to 31st December, 2022. However listed entities are required to send hard copy of full annual report to those shareholders who request for the same. Further the notice of Annual General Meeting published by advertisement in terms of Regulation 47 of the SEBI LODR shall contain a link to the full annual report.
In case of general meetings held through electronic mode, the requirement of sending proxy forms under Regulation 44 (4) of the SEBI LODR is dispensed with up to December 31, 2022.
Annual report to holders of Non-Convertible Securities
Exemption has been granted under Regulation 58(1)(b) of SEBI LODR from dispatch of annual report to holders of non-convertible securities up to 31st December, 2022 vide SEBI circular dtd 13th May, 2022.
Simplification and Standardization of process for Transmission of Securities
SEBI had amended the provisions for transmission of securities through amendment to SEBI LODR vide notification dtd 25th April, 2022. In furtherance to the same SEBI has released a circular dtd 18th May, 2022 providing for simplified transmission process and standardized formats of documents to be submitted for transmission of securities.
On 22nd January, 2020 SEBI had released a circular for streamlining the rights issue process. Para C(e) of Annexure I of the Circular dealt with Trading in Rights Entitlements (REs) on secondary market platform of the Stock Exchanges. The said trading in REs with T+2 rolling settlement was required to be commenced on the date of opening of the issue and closed at least four days prior to the closure of rights issue. Compliance of the same could not be ensured in instances where there were trading holidays between last date of REs trading date and issue closure date. Representations were received in this regard and SEBI vide Circular dtd 19th May, 2022 has amended the said provision of the Annexure by substituting the words “at least four days” to “at least three working days”. The circular is applicable with immediate effect for all rights issue and fast track rights issue.
Revised format of security cover certificate, monitoring and revision in timelines- Non-Convertible Securities
SEBI Circulars released in October and November 2020 providing for format of security cover certificate, periodical monitoring, disclosures by Debenture Trustees (DTs) and creation of Recovery Expense Fund (REF) have been revised vide SEBI Circular dtd 19th May, 2022. The same is in furtherance to the amendments to SEBI Regulations for Non-Convertible Securities notified on 11th April, 2022. Highlights of the revisions to Circular are as follows: –
Revised format of the Security Cover– has been revised to provide a holistic picture of all the borrowings and the status of encumbrance on the assets of the listed entity. The revised format for security cover is provided in Annexure I of the Circular. The manner of preparation has been described in the Circular.
Monitoring of covenants– Listed entity to furnish the compliance status with respect to financial covenants of the listed debt securities certified by statutory auditor of listed entity to DTs on quarterly basis. DTs have also been entrusted with proactive and effective monitoring of covenants as per guidelines described in the circular.
Disclosure Requirements– Disclosures by DTs to Stock Exchange (SE) shall be made
within 48 hours of issuance of consent/ no-objection certificate by DT to listed entity and
in case of breach of minimum-security cover within 48 hours of such breach.
Revision in timelines– The timelines for submitting various reports by DTs to SEs have been revised as follows:- .
Security Cover Certificate and website disclosure of the same and quarterly compliance report for all quarters except last quarter
W/n 75 days from end of each quarter
Above requirement for last quarter
W/n 90 days from end of the financial year (FY)
Valuation report and title search report
Once in 3 years w/n 75 days from end of the FY
Half yearly compliance report
W/n 75 days from end of each half year
Details of other activities carried out by Debenture Trustee(s) including type of activity, description of activity etc
Same as above
It is also clarified that half-yearly compliance report shall be reviewed by the Board of Directors of the DT before submission to SEBI.
Monitoring REF– It has been clarified that the purpose for creation of REF is to be read as for “enforcement/ legal proceedings” instead of “enforcement of security”. This clarification comes amidst the ambiguity relating to applicability of REF in case of unsecured debentures. Other guidelines have been provided for in the circular.
The revised requirements come into force with immediate effect except those covered under Para A and B above. The same shall come into force only w.e.f 01st October, 2022.
The IBBI had issued a Circular dated 26th August 2019 clarifying that the Insolvency and Bankruptcy Board of India (Liquidation Process) (Amendment) Regulations, 2019 (Amendment Regulations 2019) will be applicable only to liquidation processes which commenced on or after 25th July 2019. In order to bring more clarity, Explanations have been inserted under Regulations 2A, 21A, 31A and 44 through the Insolvency and Bankruptcy Board of India (Liquidation Process) (Amendment) Regulations, 2022 notified on 28th April, 2022. Accordingly, the 26th August, 2019 circular has been withdrawn by IBBI w.e.f. 06th May, 2022.The amended Regulations deals with the following aspects of liquidation process:-
Regulation 2A-Contributions to liquidation costs The liquidator shall call upon the financial creditors, being financial institutions, to contribute the excess of the liquidation costs over the liquid assets of the corporate debtor in proportion to the financial debts owed to them by the corporate debtor.
Regulation 21A- Presumption of security interest The secured creditor shall inform the liquidator of its decision to relinquish its security interest to the liquidation estate or realise its security interest in Form C or Form D as provided in Schedule II of the Regulations.
Regulation 31A- Stakeholders’ Consultation Committee The liquidator shall constitute the Stakeholders’ Consultation Committee within sixty days from the liquidation commencement date in the manner prescribed in the Regulations.
Regulation 44- Completion of liquidation The liquidator shall liquidate the corporate debtor within a period of one year from the liquidation commencement date. Where a sale is attempted under Regulation 32A (1), additional period up to 90 days will be allowed.
Amendment to Rule 44E- Application for advance ruling
The Central Board of Direct Taxes has amended Rule 44E of the Income Tax Rules, 1962 vide Notification dtd 05th May, 2022 which relates to application for obtaining advance ruling. The following forms have also been amended through the said notification: –
Form No. 34C (Form of application by a non-resident applicant for obtaining an advance ruling under section 245Q (1) of the Income-tax Act, 1961)
Form 34D (Form of application by a resident applicant seeking advance ruling under section 245Q (1) of the Income-tax Act, 1961 in relation to a transaction undertaken or proposed to be undertaken by him with a non-resident)
Form 34DA (Form of application by a resident applicant referred to in section 245N(b)(iia) seeking advance ruling under section 245Q (1) of the Income-tax Act, 1961 in relation to a transaction undertaken or proposed to be undertaken by him)
Form 34E (Form of application by a person falling within such class or category of persons as notified by Central Government in exercise of powers conferred for obtaining an advance ruling under section 245Q (1) of the Income-tax Act, 1961)
Form 34EA (Form of application for obtaining an advance ruling under section 245Q (1) of the Income-tax Act, 1961)
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]