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Jun 27, 2012

MCA & RBI Updates

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MCA Updates
MCA levies fee on certain form
Ministry of Corporate Affairs vide its General Circular No. 14/2012 dated June 21,2012 has levied fees for filing forms on MCA portal, which were till now being filed for free of cost. The effective date of circular is July 22nd, 2012. The forms which are under the domain of this Circular are as follows:
A. Form 1 of Investor Education Protection Fund Rule (Awareness and Protection of investors) Rules, 2001

Every company which is required by the Companies Act, 1956 to credit to Investor Education and Protection Fund any amount as per the relevant section of the Act, has to file a statement of amounts credited to the Fund in this form.

Earlier, the form was filed free of cost, but now it has to be filed with the concerned Registrar of Companies through MCA 21, as per the fees mentioned in Schedule X of the Companies Act, 1956.
B. Form 23B

Every statutory auditor appointed by the company in the Annual General Meeting under section 224(1) of the Companies Act, 1956 in this form has to intimate whether he has accepted the appointment or not to the concerned Registrar of Companies, , within 30 days of the intimation received from the company by the auditor.

Earlier, the form was filed free of cost, but now it has to be filed through MCA 21, as per the fees mentioned in Schedule X of the Companies Act, 1956
C. Form 24A

This form is filed by the company under different sections of the Act for many purposes mentioned here under.

  1. Rectification of name of a company under Section 22 of the Companies Act, 1956
  2. Application for issue of license under Section 25 of the Companies Act, 1956
  3. Appointment of auditor by Central Government, when no auditor is appointed or reappointed at AGM under Section 224(3) of the Companies Act, 1956
  4. Removal of auditor of the Company under Section 224(7) of the Companies Act, 1956
  5. Approval for entering into contract of sale, purchase, supply of goods, materials and services and for underwriting of shares or debentures with related parties under Section 297 of the Companies Act,1956

    Earlier, fees was paid for purposes mentioned at (a), (b) and (e) as per Companies (Fee on Application) Rules, 1999 and not in cases mentioned at points (c) and (d), but now fees also has to be paid as per the Rules on these purposes also.
D. Form 36

This form is filed by receiver or manager for filing the abstract of receipts and payments, pursuant to section 424 read with 421 and also pursuant to section 600 of the Companies Act, 1956.

Earlier, the form was filed free of cost, but now, the form has to be filed with fees prescribed in Schedule X of the Companies Act, 1956.
E. Form 61

This form is filed by the company, making an application to concerned Registrar of Companies for the following purposes:

  1. Extension of period of Annual General Meeting under section 166(1) of the Companies Act,1956
  2. Extending of financial year beyond 18 months under section 210(4) of the Companies Act,1956
  3. Filing of Scheme of Amalgamation and reconstruction of companies under section 394 of the Companies Act,1956
  4. Declaring a Company as defunct company under section 560 of the Companies Act,1956
  5. Compounding of offences under section 621A of the Companies Act,1956

    Earlier, companies could file this form for any of the aforementioned purposes, without any fees, but now fees has to be paid as per Companies (Fee on Application) Rules, 1999

F. Form 62

This form, if being filed for filing Form 154, Form 157 and Form 158 of the Companies (Court) Rules, 1959, will now attract fees as per Schedule X of the Companies Act, 1956
G. Form 65

The company is required to file this form, making an application to the Central Government for the following purposes

  1. Application pursuant to rule 2 of the Companies (application for extension of time or exemption under subsection (8) of section 58A) Rules, 1979

    Now the form may be filed as per Companies (Fee on Application) Rules, 1999

  2. Others- To submit any application or document with Central Government, where no other form has been prescribed

    The form, now may be filed as per Companies (Fee on Application) Rules, 1999
RBI Updates
I. External Commercial Borrowings (ECB)
  A. Repayment of Rupee loans

In furtherance to the circulars dated 23rd September, 2011 and 20th April 2012 regarding liberalization of ECB norms for infrastructure sector and power sector, with respect to repayment of rupee loan, RBI has further liberalized the norms for both the sector. In this regard, RBI has allowed Indian companies (Power and Infrastructure Sector) to raise ECB for repayment of rupee loan(s) availed from domestic banking system and/ or for fresh rupee capital expenditure, under approval route, subject to the following conditions:

  1. Such companies should have been a consistent foreign exchange earner during the past three financial years,
  2. Such companies are not in default list/ caution list of the Reserve Bank of India,
  3. The ECB shall be utilized only for repayment of rupee loan availed of for “capital expenditure” incurred earlier and are still outstanding in the books of domestic banking system and/ or fresh rupee capital expenditure
    Limits

The overall ceiling of above mentioned ECBs shall be USD 10 (ten) billion subject 50% of average annual export earnings realized during past 3 financial years
    Requirements

The Companies seeking to avail ECB, may submit Form ECB through their Authorized Dealer Bank along with the following:

  1. Certificate from the statutory auditor regarding utilization of rupee loan(s) w.r.t ‘capital expenditure’ incurred earlier,
  2. Certificate from the statutory auditor that the Company is a consistent net foreign exchange earner during the past three financial years,
  3. The outstanding rupee loan(s) shall be certified by the domestic lending bank(s) and the designated authorized dealer bank.

The Company shall draw down the entire facility within a month after obtaining Loan registration Number from the Reserve Bank.
  B. Rationalization of Form 83

The Indian companies proposing to avail ECB are required to obtain Loan Request Number by submitting the revised Form 83 to Reserve Bank of India. The Reserve Bank of India has rationalized the Form 83 vide circular no —– dated and has come out with the new format. Major changes are:

  1. The Instruction have been given at the end the revised format i.e. Annex I.
  2. Annex II – showing the method to calculate Average Maturity period is added.
  3. Form has to be addressed to The Director, Balance of Payments Statistics Division, Department of Statistics and Information Management (DSIM), Reserve Bank of India, C-8-9 Bandra-Kurla Complex, Mumbai- 400 051.
  4. Separate Parts have been categorized for the details of Lenders, Borrowers, Loan, Charges, ECB already availed.
     
II. Limits enhanced for Foreign investment in India by SEBI registered FIIs in Government securities and SEBI registered FIIs and QFIs in infrastructure debt
    Government Securities

As per the extant policy, FIIs are allowed to

  1. invest in non-convertible debentures / bonds issued by Indian companies in the infrastructure sector and non-convertible debentures / bonds issued by Non-Banking Financial Companies categorized as ‘Infrastructure Finance Companies’ (IFCs) by the Reserve Bank of India within the overall limit of USD 25 billion; and
  2. invest in Government securities within an overall limit of USD 15 billion; subject to certain terms and conditions.
    Further, Qualified Foreign Investors (QFIs) are presently allowed to invest in units of Mutual Funds debt schemes upto a limit of USD three billion within the overall limit of USD 25 billion for FII investment in non-convertible debentures / bonds issued by Indian companies in the infrastructure sector.
    The Reserve Bank of India (RBI), in consultation with the Government of India has decided to enhance with immediate effect the existing limit for investment by SEBI registered foreign institutional investors (FIIs) in Government Securities (G-Secs) in following manner
   
  Existing Limit New Limit
Investment by SEBI registered foreign institutional investors (FIIs) in Government Securities (G-Secs) USD 15 billion USD 20 billion
    The sub-limit of USD 10 billion (existing USD 5 billion with residual maturity of 5 years and additional limit of USD 5 billion) would have the residual maturity of three years.
    In order to broad base the non-resident investor base for G-Secs,RBI has also decided to allow long term investors like Sovereign Wealth Funds (SWFs), multilateral agencies, endowment funds, insurance funds, pension funds and foreign central banks to be registered with SEBI, to also invest in G-Secs within the enhanced limit of USD 20 billion.

Infrastructure Debt

The conditions for the limit of USD 22 billion including the sub-limit of USD 5 billion with one year lock-in/residual maturity requirement and USD 10 billion for non resident investment in IDFs (which are all within the overall limit of USD 25 billion for investment in infrastructure corporate bonds) have been changed as under :

  1. The lock-in period for investments under this limit has been uniformly reduced to one year; and
  2. The residual maturity of the instrument at the time of first purchase by an FII/ eligible IDF investor would be at least 15 months.
Further, Qualified Foreign Investors (QFIs) can now invest in those mutual fund (MF) schemes that hold at least 25 per cent of their assets (either in debt or in equity or both) in infrastructure sector under the current USD 3 billion sub-limit for investment in mutual funds related to infrastructure.


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