Dear Friends,

Saraswathi, the Goddess of Learning is invoked during Navaratri (9 days). Coincidentally, in this 280th issue of Samhita (1st issue was published in 2009) we are starting a new column“Books – Best Buddy”, featuring books of different genres, recommended by readers. Infact the suggestion came from one of our readers, Hyderabad based Santhosh who is a Company Secretary turned International Ventriloquist. It reflects the ethos of Samhita –light the lamp of knowledge and dispel the darkness of ignorance !

The inaugural column features an Amazon best-seller“You Just Got Cheated – Understanding white collar crimes”by my good friend, Dr. Sibichen Mathew, Commissioner of Income Tax (CPC), author, professional speaker, film maker, all rolled into one. This book is the culmination of over 6 years of research into various white collar crimes across the globe.

The name reveals it all – how you and me, common man get cheated day in and day out by all kinds of fraudsters. Right from a car servicing centre to a sham innovator to a ‘promising’ scheme to large corporates to food chains to politicians to NGOs – at different levels and scales we are cheated and we are almost oblivious to it. We think white collar crimes do not affect the common man. We think the so-called ‘system’ will take care of itself. Or wish that it will not repeat again.

Sadly, this is not true.”History reveals that crimes travel across the globe in time as criminals learn from each other for their criminal indulgences” says Dr. Sibichen. The book does throw light on many cases where scamsters have been nabbed thanks to either public proactiveness or societal angst and action. More often than not the regulators wake up after the crime is committed and try to bolt the horse after it has run out of the stable – tighten the rules and regulations as a reaction rather than as a response ! As evidence shows, by then the criminal is out on the streets, having escaped to a safe haven with the booty.It is you and me who are left stranded as victims, with empty wallets, lost jobs, dead families, failing health and a bruised economy that has an adverse long-term effect on society.

The book is a treatise on the‘why, how, and what of the WCCs from the perspective of victimology’, rather than revealing the gory details of various kinds of scams alone, which it does in any case. All from a hitherto unexplored, victim perspective to shake us out of our slumber. To create awareness. To call for concerted action. To make us responsible global citizens. To leave the world as a better place….!!

Awareness and action are a result of the awakening within. 9 days of Navaratri is a celebration of Shakthi – an embodiment of Energy, Abundance & Knowledge. It is a time to transit from ‘tamas’ to ‘rajas’, to awaken the energy within us, to come out of our comfort zones, to break the shell of lethargy, to change, to transform, to ACT. So that ABUNDANCE abounds !

As always, MCA has introduced certain changes when we are in the peak of AGMs and annual filings of financial statements. CSR rules have undergone a change requiring additional disclosures in Board’s Report. Small company definition has changed thanks to the enhanced ceiling of turnover and paid up capital criteria (40cr and 4cr). You can have a quick glance on the ready reckoner for small companies under the Companies Act, 2013, as you scroll down for regulatory updates. As you mark out the compliance dates from the statutory calendar and reflect on the ‘BBC’ tips, do enjoy the festive season !

For any previous issues of Samhita and the readers feedback, please visit our website.

Happy Reading,

iconBest Buddy
Book Review

© 2022, SAGE

Review & Buy on Amazon

You Just Got Cheated

Dr. Sibichen K. Mathew

Right from the title to the ‘dedications’ page, Dr. Sibichen Mathew has made it amply clear who the victim of white-collar crimes (WCC) is – the ubiquitous, unsuspecting, unfortunate common man who is made to believe that the consequence is not him, not now. The book debunks this very myth that a crime committed somewhere does not impact you and me. How does he do it ? By peeling layers after layers of WCC committed across generations, geographies and genres, gleaned from his years of dedicated research and diligent analysis – presented to us with facts, figures and insights in an easy-to-understand 15 chapter format.

Recommended By: SC Sharada

Effective Business Communication

Tip 1:

Effective communication – Organization culture

When I went to a company for an interview, a security guard asked me to wait at the reception for the interviewer to arrive. Four people asked me why I was waiting and if I had breakfast. They assured me that the person concerned would meet me once he reached the office.

None of the above had anything to do with recruitment and neither were they receptionists. However, they made sure I was comfortable and wasn’t left unattended. The beauty is nobody taught them to do so. They saw someone do it when they came for their interviews.“Attitudes are caught and not taught”, as per Fred Rogers. So is organization culture too. When many follow a certain etiquette, every new employee also follows it even without being asked to do so. If you could get the desired behaviour from your team without explicitly talking about it, isn’t it an excellent way of communication?

Tip 2:

How to say ‘Your contribution matters’ – Talking about the big picture

A person who works on compliance is not merely pushing different teams in an organization to abide by certain rules, merely because it’s a part of his job. What he does goes a long way in making sure a company doesn’t shut down or face a challenge or pay a huge fine or compensation. Imagine if it happens – the Company is forced to fire its employees or reduce their salaries. A person working on compliance saves the jobs of so many people.

A person who writes code is not merely working on some technical stuff. Imagine if it is for the aviation or healthcare or manufacturing industry – he is responsible for the safety of so many people!

It pays if you paint the big picture to employees – helps them understand the significant difference that they are making to the lives of others!

Statutory Calendar
Oct 06

1. SEZ Monthly Return for the Previous month

Oct 07

1. STPI Monthly Return for the previous Month
2. Monthly Return in ECB – 2 under FEMA
3. Equalization Tax
4. TDS/TCS payment

Oct 11

1. GSTR-1 monthly return for September, 2022 aggregate turnover exceeding 1.5 crores

Oct 15

1. PF Payment

Oct 18

1. CMP-08 for July to September quarter

Oct 20

1. GSTR-3B for the month of September, 2022
2. PT Payment

Oct 21

1. E.S.I.C payment

Oct 25

1. PF return – Monthly

Oct 30

1. LLP Form-8

Oct 31

1. TDS return for Q2 FY 2022-23

Regulatory Updates
MCA Updates
CSR Rules – Amended

MCA vide Notification dtd.20 September 2022 has amended the Companies (Corporate Social Responsibility Policy) Rules, 2014 bringing about following changes:

  • Proviso added to Rule 3(1) – companies having any unspent amount in the Unspent Corporate Social Responsibility Account are required to constitute a CSR Committee.
  • Rule 3(2) omitted – the erstwhile sub-rule prescribed that companies which do not fall within the thresholds for CSR for 3 consecutive years shall not be required to constitute CSR Committee. This sub-rule has been omitted.
  • Rule 4(1) substituted:
    • Section 8 companies, registered public trust or societies exempted under Section 10(23C)(iv)(v)(vi)(via) of Income Tax Act, 1961 – have been added to clauses (a) and (d) of Rule 4(1), alongwith Sec 12A and 80G approvals and
    • Explanation inserted in Rule 4 – an explanation clarifying the meaning of “entity” for the purpose of the Rule. The explanation clarifies that a company may achieve it’s CSR obligation through a statutory body constituted under an Act of Parliament or State legislature to undertake activities covered in Schedule VII of the Act.
  • Permitted administrative overheads chargeable – 2% (reduced from 5%) or 50 lakhs whichever is higher (earlier – whichever is lower).
  • A revised format for annual report on CSR – introduced. For all Board’s Reports being approved post 20 September 2022 this is applicable.
  • E-Form CSR-1 amended – to include entities added to Rule 4(1)

The above mentioned changes shall take effect from 20 September 2022.

Definition of Small Companies – scope widened

MCA vide Notification dtd.15 September 2022 had amended the definition of Small Company through amendment to the Companies (Specification of definition details) Rules, 2014.

The amended definition has increased the limits from an upper cap of paid-up capital of Rs.2 crores to Rs.4 crores and turnover of Rs.20 crores to Rs.40 crores. The limits have been doubled making more number of companies eligible to claim the relaxations available for Small Companies under the Companies Act, 2013.

It is to be noted that both limits have to be satisfied.

The widened scope of the Small Companies definitions seems to be yet another change under the Ease of Doing Business Initiative aimed at reducing compliance burden. In view of the same the exemptions and advantages available for Small Companies under Companies Act, 2013 are noteworthy. A ready reckoner consisting of the exemptions available to Small Companies is attached here.

Clarification on Sch III amendments and AOC-4 filing

An updated was posted on the MCA website on 26 September 2022 clarifying that the figures in the Form AOC-4 can be mentioned in actuals and the same shall not be considered as incorrect certification. Although the Amended Schedule III of the Companies Act, 2013 requires the financial figures to be rounded off based on their total income.

DIR-3KYC verification – due date extended

MCA vide notification dated 28 September 2022 has extended the due date for completion of DIR-3 KYC verification (through filing of Form DIR-3KYC or web-based verification) till 15 October 2022 from 30 September 2022.

SEBI Updates
Framework for Social Stock Exchange

SEBI vide notification dtd.25 July 2022 had made amendments to the ICDR, LODR and AIF Regulations to provide a broad framework for Social Stock Exchange (SSE). Vide Circular dated 19 September 2022, SEBI has notified the framework for Not for Profit Organisations (NPO). Highlights of the same are as follows:

  • Minimum requirements: The minimum requirements have been classified as legal requirements and minimum fund flows. Please click on thelinkto view the table.
  • Minimum initial disclosure requirements for NPO registered on SSE or NPOs raising funds: Structure of the draft / final fund raising document should contain details regarding the vision, target segment, strategy, governance, management, operations, finance, compliance, credibility, social impact and risks.
  • Annual Disclosures by NPOs who have raised funds or have registered on the SSE: NPOs to file following disclosures within 60 days of close of the financial year:
    • Disclosures on general aspects
    • Disclosures on Governance aspects
    • Disclosures on Financial aspects
  • Annual Impact Report (AIR) by all Social Enterprises who have registered on or raised funds through SSE:
    • Duly audited AIR to be filed with SSE within 90 days of end of FY
    • The AIR shall capture the qualitative and quantitative aspects of the social impact generated by the entity and where applicable, the impact that is generated by the project or solution for which funds have been raised on SSE.
    • The AIR should cover strategic intent and planning, approach and impact score card
    • NPOs registered without listing – AIR must cover the NPO’s significant activities, intervention, programs or projects during the year and the methodology for determination of significance must be explained
  • Statement of utilisation of funds: to be submitted within 45 days of end of each quarter.

Guidance notes on disclosures under points (C)(D) have been provided as Annexures to the Circular.

Open Circular No. SEBI/HO/CFD/PoD-1/P/CIR/2022/120 dtd.19 September 2022
DGFT Updates
FTP (2015-20) extended for 6 months

Based on the representations received from stakeholders, the Foreign Trade Policy (2015-20) (which was valid till 30 September 2022) has been further extended for a period of 6 months w.e.f.1 October 2022.

Open Press Release dtd.26 September 2022
IBBI Updates
Start up definition aligned with DPIIT definition – fast track corporate insolvency resolution process

Vide Notification dtd.30 August 2022 IBBI has aligned the definition of start-up under eligible corporate debtors who can submit an application for fast track corporate insolvency resolution process with the DPIIT Notification dtd.19 February 2019.

In terms of the said notification, companies/ LLPs/ partnership firms shall be considered as a start-up for upto 10 years from incorporation/registration (earlier seven years) and turnover upto Rs.100 crores (earlier Rs.25 crores).

Prior to the amendment the definition was limited to the DPIIT Notification dtd.23 May 2017.

Open Notification No. S.O. 4142(E). dtd.30 September 2022

Note 1: 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.

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