lexspeak Hi Folks Whether a mother is a verb, noun, adjective or whatever; whether she is an ‘archer’ or an ‘air traffic controller’; she is a leader no doubt. In a leadership workshop that I attended recently, a leader was described to be one having the following 5 characteristics : Skin of a rhino Courage of a soldier Compassion of a mother Understanding of a friend Patience of a saint Being a mother is more of possessing certain traits than belonging to a gender. Mother’s compassion is unbound and all encompassing and not limited to a particular day in a year like Mother’s Day that just went by. While you reflect on the above, do take time to keep yourself abreast of what changes the various Ministries have effected through Circulars and Notifications covering Service Tax, FEMA, Customs, Company Law etc. To read the earlier issues and articles Click HereSincerely S.C.Sharada Member – LV Team A simple letter with name and address of applicant as well as beneficiary along with amount to be remitted and the purpose of remittance is what is needed to release the foreign exchange amount up to US$25,000 for miscellaneous remittances (earlier limit was US$5000). Application in Form A-2 is a must for forex amount exceeding the said limit. This is effective form 7th May, 2012. Prior approval of FIPB would be required only for FDI component for foreign investment in commodity exchange and not for the registered FII. FDI in Leasing and Finance has been amended to permit 100% FDI only into “Financial Lease” and not into “Operation Lease”. Both the borrower and the AD category Bank (Authorised Category Dealer) are responsible to ensure repatriation into India, proceeds of External Commercial Borrowing (ECB) meant for Rupee Expenditure in India. To avail the said benefit, borrowers should apply for Loan Registration Number with bifurcation of the utilization of the ECB proceeds towards foreign currency and Rupee expenditure in Form-83. With a view to incentivising use of machinery embodying the latest state-of-the-art technology, compliant with international standards, in terms of being green, clean and energy efficient, RBI has decided not to permit allotment of equity shares against imported second-hand machinery. Effect from 7th May, 2012 RBI has allowed transfer of funds from Non-Resident Ordinary (NRO) account to Non-Resident External (NRE) Account within the overall ceiling of US $ 1 million per financial year, subject to payment of applicable taxes. Hitherto, transfer of funds from NRO to NRE account was not permissible. Proprietary Concerns can open their account with Banks only after submitting the following documents in addition to Identity and address proof of the proprietor, proof of the name, address and activity of the concern: Complete Income Tax Return of the sole proprietor where the firm’s income is reflected, duly authenticated / acknowledged by the Income Tax Authorities. Utility bills such as electricity, water and landline telephone bills in the name of the proprietary concern.

An exchange earner is eligible to retain only 50% of his total earnings (as against the previous limit of 100%) in non-interest bearing Exchange Earner’s Foreign Currency (EEFC) accounts. The balance 50% shall be surrendered for conversion to rupee balances.

Effective 7th May, 2012, Marbles supplied by EOU/EHTP/STP/BTP to Domestic Tariff Area will not be counted for fulfillment of positive NFE unless such supply is an inter unit supply.

CBEC has clarified that cases relating to “Parallel Imports” (import of goods without the permission of its IPR holder ) shall be decided on the basis of provisions in the parent Acts i.e., Trade Marks Act, Patents Act etc.

In order to have a check on the discrepancies found under the Straight Through Process (STP) relating to Name Availability applications by Company promoters, MCA has put in place a stringent back end system for verification of such applications.

CBEC has clarified that enhanced rate of Service Tax i.e., 12% would be applicable for payments received on or after 1st April, 2012 although the invoice for the taxable services have been raised before the 31st March, 2012 at 10% Service Tax. This is in respect of 8 specified services (Consulting Engineers, CA, CWA, CS, Legal advice by business entity etc).

Accounting Standard – 1 (AS – 1) dealing with disclosure of Accounting Policies mandatory for all forms of business has been explained briefly.

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. Lex Valorem disclaims all liability on action taken without professional advice.

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