Thursday, 19 March 2015

Friday, 27 February 2015

Comparative Study : PCS allowed to become designated partner of a LLP

Dear Professional Colleagues,

Comparative study :

New Provisions
Old Provisions
The Council at its 227th Meeting held at New Delhi on  January 18, 2015 while approving the formation of LLPs by PCS granted general permission to the members in practice to:
The Council had  at the 156th meeting held on 19th – 20th March, 2005 gave general permission to the members in practice to:
(a) become designated / active partner of a limited liability partnership (LLP) the objects of which include carrying out attestation services which fall within the scope of the profession of Company Secretaries irrespective of whether or not the practicing member holds substantial interest in that LLP;
(a) become passive partner of a limited liability partnership (LLP) the objects of which include carrying out non-attestation services which fall within the scope of the profession of Company Secretaries irrespective of whether  or not the practicing member holds substantial interest in that LLP;
(b) become passive partner of LLP which is engaged in any other business or occupation provided that the practicing member does not hold substantial interest in that LLP.

(b)    become passive partner of LLP which is engaged in any other business or occupation provided that the practicing member does not hold substantial interest in that LLP.
(i) “Attestation Services” include Secretarial Audit and Certification of Annual Return in terms of the provisions of the Companies Act, 2013.
(i)     “Attestation Services” include services which require signing any certificate, document, report or any other statements relating thereto on behalf of a Company Secretary in Practice or a firm of such Company Secretaries in his or its professional capacity or which require signing anything that is required to be signed by a Company Secretary in practice.
(ii) “Non-attestation Services” means services which are not attestation services.
(ii)   Non-attestation Services” means services which are not attestation services.


(iii) A “passive partner” means a partner of LLP who fulfils the following conditions:

(a) he must not be a designated partner;
(b) subject to the LLP agreement, he may make agreed contribution to the capital of LLP and receive share in the profits of the LLP; and
(c) he must not take part in the management of the LLP nor act as an agent of the LLP or of any partner of the LLP;

However, none of the following activities shall constitute taking part in the management of the LLP:

(1) Enforcing his rights under the LLP agreement (unless those rights are carrying out management function).

(2) Calling, requesting, attending or participating in a meeting of the partners of the LLP.

(3) Approving or disapproving an amendment to the partnership agreement.

(4) Reviewing and approving the accounts of the LLP;

(5) Voting on, or otherwise signifying approval or disapproval of any transaction or proposed transaction of the LLP including –

a) the dissolution and winding up of the LLP;

(b) the purchase, sale, exchange, lease, pledge, mortgage, hypothecation, creation of a security interest, or other dealing in any asset by or of the LLP;

(c) a change in the nature of the activities of the LLP;

(d) the admission or removal of a partner of the LLP;

(e) transactions in which one or of a security interest, or other dealing in any asset by or of the LLP;



(f) any amendment to the LLP agreement;

(iii)  A “passive partner” means a partner of LLP who fulfils the following conditions:

(a)      he must not be a designated partner;
(b)    subject to the LLP agreement, he may make agreed contribution to the capital of LLP and receive share in the profits of the LLP; and
(c)      he must not take part in the management of the LLP nor act as an agent of the LLP or of any partner of the LLP;

However, none of the following activities shall constitute taking part in the management of the LLP:

(1) Enforcing his rights under the LLP agreement (unless those rights are carrying out management function).

(2)         Calling, requesting, attending or participating in a meeting of the partners of the LLP.

(3)     Approving or disapproving an amendment to the partnership agreement.

 (4)    Reviewing and approving the accounts of the LLP;

 (5)     Voting on, or otherwise signifying approval or disapproval of any transaction or proposed transaction of the LLP including  -

(a)        the dissolution and winding up of the LLP;

 (b)       the purchase, sale, exchange, lease, pledge, mortgage, hypothecation, creation of a security interest, or other dealing in any asset by or of the LLP;

 (c)   a change in the nature of the activities of the LLP;

 (d)    the admission or removal of a partner of the LLP;

 (e)    transactions in which one or more partners have an actual or potential conflict of interest with one or more partners or the LLP;

 (f)        any amendment to the LLP agreement;

(iv) a member shall be deemed to have a “substantial interest” in an LLP if he is entitled at any time to not less than 25% of the profits of such LLP.
(iv)    a member shall be deemed to have a “substantial interest” in an LLP if he is entitled at any time to not less than 25% of the profits of such LLP.”

Wednesday, 11 February 2015

Practicing Company Secretaries allowed to become designated / active partner of a Limited Liability Partnership

Dear Professional Colleagues,

The Council at its 227th Meeting held at New Delhi on January 18, 2015 while approving the formation of LLPs by PCS granted general permission to the members in practice to:

(a) become designated / active partner of a limited liability partnership (LLP) the objects of which include carrying out attestation services which fall within the scope of the profession of Company Secretaries irrespective of whether  or not the practising member holds substantial interest in that LLP;

(b) become passive partner of LLP which is engaged in any other business or occupation provided that the practising member does not hold substantial interest in that LLP.

For the purposes of the above resolution:

i. “Attestation Services” include Secretarial Audit and Certification of Annual Return in terms of the provisions of the Companies Act, 2013.

ii. Non-attestation Services” means services which are not attestation services.

iii. A “passive partner” means a partner of LLP who fulfils the following conditions:

a. he must not be a designated partner;
b. subject to the LLP agreement, he may make agreed contribution to the capital of LLP and receive share in the profits of the LLP; and
c. he must not take part in the management of the LLP nor act as an agent of the LLP or of any partner of the LLP;

However, none of the following activities shall constitute taking part in the management of the LLP:

1. Enforcing his rights under the LLP agreement (unless those rights are carrying out management function)

2. Calling, requesting, attending or participating in a meeting of the partners of the LLP

3. Approving or disapproving an amendment to the partnership agreement.

4. Reviewing and approving the accounts of the LLP

5. Voting on, or otherwise signifying approval or disapproval of any transaction or proposed transaction of the LLP including  -

(a)       the dissolution and winding up of the LLP;
(b)       the purchase, sale, exchange, lease, pledge, mortgage, hypothecation, creation of a security interest, or other dealing in any asset by or of the LLP;
(c)        a change in the nature of the activities of the LLP;
(d)       the admission or removal of a partner of the LLP;
(e)       transactions in which one or more partners have an actual or potential conflict of interest with one or more partners or the LLP;
(f)        any amendment to the LLP agreement;

(iv)    a member shall be deemed to have a “substantial interest” in an LLP if he is entitled at any time to not less than 25% of the profits of such LLP.

New format for e-IEC

New format for e-IEC- introduction of Appendix 18B -1 (Format of e-IEC) in Handbook of Procedure Vol. I (Appendices and Aayat Niryat Forms), 2009-2014.

http://dgft.gov.in/Exim/2000/PN/PN13/publicnotice-84.pdf

Friday, 6 February 2015

Revision of eligibility criteria to strengthen the entry norms for SME exchange.

BSE SME Platform offers an entrepreneur an investor friendly environment, which
enables the listing of SMEs from the unorganized sector scattered throughout India, into a regulated and organized sector. 

Presently, 83 Companies are listed on BSE – SME platform as on February 4, 2015.

The Exchange has stipulated certain financial and non-financial eligibility criteria / norms for listing on SME platform in addition to the SEBI guidelines for listing of SME as laid down in the Issue of Capital and Disclosure Regulations.

In order to further strengthen and enhance the screening of companies seeking listing on the SME Segment, it is proposed to revise the above financial norms as follows:

Norms
Existing Norms
Revised Norms
Post Issue Paid up Capital:
The post-issue paid up capital of the company shall be at least Rs. 1 crore.
The post-issue paid up capital of the company shall be at least Rs. 3 crores .
Net worth
Net worth (excluding revaluation reserves) shall be at least Rs.1 crore as per the latest audited financial results.
Net worth (excluding revaluation reserves) of at least Rs.3 crore as per the latest audited financial results.
Net Tangible Assets
At least Rs.1 crore as per the latest audited financial results.
At least Rs.3 crore as per the latest audited financial results.
Track Record
Distributable profits in terms of Section 205 of the Companies Act 1956 for at least two years out of immediately preceding three financial years (each financial year has to be a period of at least 12 months). Extraordinary income will not be considered for the purpose of calculating distributable profits.
Or
Net worth shall be at least Rs.3 crores.
Distributable profits in terms of Section 123 of the Companies Act 2013 for at least two years out of immediately preceding three financial years (each financial year has to be a period of at least 12 months). Extraordinary income will not be considered for the purpose of calculating distributable profits.
Or
Net worth shall be at least Rs.5 crores.

All other norms (other than those revised as above) would remain unchanged.

The above revised criteria would be applicable with effect from April 1, 2015.

Tuesday, 3 February 2015

DGFT operationalises online filing of IEC applications, online processing and issue of e-IECs in digital format

Press Information Bureau
Government of India
Ministry of Commerce & Industry
03 - February - 2015 10:07 IST

DGFT operationalises online filing of IEC applications, online processing and issue of e-IECs in digital format 

Directorate General of Foreign Trade has started operationalising online filing of Importer Exporter Code (IEC) applications, online processing and issue of e-IECs in digital format. Now new entrepreneurs/exporters/importers can apply online for issue of new IEC from the comfort of their home/IT Kiosk with no more visits to the Regional Authority's office required, and upload the documents and pay the required fee through Net banking.

Even the processing of such applications by Regional Authority of DGFT would be done online (no paper work in the office; less storage space required and no misplaced documents) and the digitally signed e-IEC (no more IECs in physical form) would be issued/emailed to the applicants within two working days.

In case the application is incomplete or otherwise ineligible, the same shall be rejected and an auto generated Rejection letter/email (with reasons for rejection) would be sent to the applicant - within two working days only. There would not be any 'Deficiencies letters' now (no more discretion at the level of RAs and consequent elimination of possible delays and corruption).

Efforts are underway to allow/enable payment of fee through Debit/Credit cards, which would further facilitate this process. Once implemented the Online system would be made mandatory. However, till such time payment through Debit/Credit cards is enabled, the existing offline/manual system has also been allowed side by side, in order to facilitate those applicants who do not have Net banking facility.

Efforts are also underway for message exchange/integration of our system with Income Tax department and Ministry of Corporate Affair for verification of PAN and DIN/CIN details respectively. Once implemented, this would further reduce the processing time of e-IEC applications at RA level (possibly one day only).

This is an important and path breaking initiative by Department of Commerce/DGFT towards "Digital India" vision of Prime Minister of India and "Ease of Doing Business". 

The government is aiming to improve India's overall ranking in ease of doing business index to 50th position in the next two years from the current 142nd position.

For more info : http://dgft.gov.in/exim/2000/PN/PN13/PN-%2083.pdf 

Wednesday, 28 January 2015

Specimen of Directors' Report as per Companies Act, 2013


Please see the below link on the specimen of Directors' Report as per CA, 2013 prepared from our end.

Kindly have a look at it and share your comments/ suggestions.

CS Monali SHAH | Practicing Company Secretary
Monali Shah & Co.| mmonali07@gmail.com


Tuesday, 20 January 2015

MCA UPDATES

1. The Companies (Accounts) Amendment Rules, 2015

 After rule 2, following rule shall be inserted, namely:-

'2A. Notice of address at which books of account are to be maintained.- For the
purposes of the first proviso to sub-section (1) of section 128, the notice regarding
address at which books of account may be kept shall be in Form AOC-5 "

(ii) in rule 6 (Manner of Consolidation of Accounts) , after the third proviso, the following proviso shall be inserted, namely:-

"Provided also that nothing in this rule shall apply in respect of consolidation of financial
statement by a company having subsidiary or subsidiaries incorporated outside India only
for the financial year commencing on or after 1" April, 2014."

(iii) in the Annexure, after Form AOC-4. the Form AOC- 5 shall be inserted.

2. The Companies (Corporate Social Responsibility Policy) Amendment Rules, 2015


In the Companies (Corporate Social Responsibility Policy) Rules' 2014, in rule 4' in sub-rule (2)-

(i) for the words "established by the company or its holding or subsidiary or associate company under section 8 of the Act or otherwise", the words "established under
section 8 of the Act by the company, either singly or alongwith its holding or
subsidiary or associate company, or alongwith any other company or holding or
subsidiary or associate company of such other company, or otherwise" shall be
substituted;

(ii) in the proviso, in clause (i). for the words "not established by the company or its
holding or subsidiary or associate company, it", the .words "not established by the
company, either singly or alongwith its holding or subsidiary or associate company,
or alongwith any other company or holding or subsidiary or associate company of
such other company" shall be substituted.

3. The Companies (Appointment and Qualification of Directors) Amendment Rules, 2015.

"Provided that in case a company has already filed Form DIR-12 with the Registrar under rule 15, a foreign director of such company resigning from his office may authorise in writing a practicing chartered accountant or cost accountant in practice or company secretary in practice or any other resident director of the company to sign Form DIR-11 and file the same on his behalf intimating the reasons for the resignation ".

Monday, 12 January 2015

Law School signs MoU with ICSI

The Tamil Nadu National Law School, Tiruchi on Thursday signed a memorandum of understanding with the Institute of Company Secretaries of India (ICSI), New Delhi.
Professor N. Murugavel, Vice-Chancellor, The Tamil Nadu National Law School, and R. Sridharan, president, ICSI, signed the memorandum of understanding at a function held at the Law School.
Among other things, the MoU will pave the way for academic interactions, especially exchange of course materials, between the two institutions and recognise the ICSI membership as equivalent to master’s degree for the purpose of pursuing Ph.D. programme at the Law School.
The ICSI will identify the papers of its examinations for which exemption may be granted to those who passed B.A. LL.B (Hons) / B.Com., LL.B (Hons) from the Tamil Nadu Law School.
More MoUs
The Law School has plans to sign MoU with some of the leading law universities in the United Kingdom and Chine in due course, a press release said.