Dear All,
Please find below important news/articles as on October 8, 2012 for your reading.
Sr. No.
1
Important News as
on October 8, 2012
Insurance cos get
tax
evasion
summons
2
Indian
Mutual
Funds, PE, wealth
managers may face
regulatory hurdle in
UAE
3
FDI restriction on
e-commerce to stay
4
Challenging
the
selling price — SC
strengthens
taxman’s hand
5
E-payment
system
News in brief
Source
The finance ministry has issued summons to about a dozen insurance firms seeking
documents pertaining to sale of insurance policies and commission paid to their field
associates as part of its probe into alleged service tax evasion of over Rs 300 crore. Official
sources said that insurance firms have been issued summons by Directorate General of
Central Excise Intelligence (DGCEI), an intelligence arm under the finance ministry.
Indian mutual funds, private equity houses and wealth managers may run into a regulatory
hurdle in the United Arab Emirates (UAE), a large offshore market for financial products. In a
recent order, the UAE's Securities & Commodities Authority (SCA) has instructed distributors
and investment advisors to seek its approval before selling a product. "Prior to any
promotion, an application for the promotion of foreign mutual fund units must be submitted
to the SCA by the local promoter (product distributor, banks selling third-party investment
products, etc) ... enclosing the documents stated in the form for each fund wishing to
promote its units within the UAE," the circular said.
The government's decision to allow foreign supermarket chains such as Walmart and Tesco
into the country does not extend to non-store formats such as teleshopping and mail order,
a senior official has clarified. Such chains will not be allowed to sell products through ecommerce, the official in the department of industrial policy & promotion told ET on the
condition of anonymity. The clarification comes amid confusion over the full implications of
the government's decision last month to allow 51% foreign direct investment in multi-brand
retail.
It is not uncommon for companies launching new products or entering new territories to sell
below production cost in an attempt to penetrate the market. Notwithstanding the
commercial ramifications of such pricing, in the light of a recent Supreme Court ruling in the
case of CCE, Mumbai vs. Fiat India Pvt Ltd, such special pricing could also entail additional
excise duty cost.
http://www.financialexpress.com/n
ews/insurance-cos-get-taxevasion-summons/1013341/
The government might be finding the Vijay Kelkar panel’s recommendations on subsidy
http://www.business-
http://economictimes.indiatimes.co
m/markets/regulation/indianmutual-funds-pe-wealthmanagers-may-face-regulatoryhurdle-inuae/articleshow/16716145.cms
http://economictimes.indiatimes.co
m/news/economy/policy/fdirestriction-on-e-commerce-to-stayreport/articleshow/16716304.cms
http://www.thehindubusinessline.c
om/industry-andeconomy/taxation-andaccounts/article3972302.ece
likely to curb black
money
6
SC
overrules
decision on cheques
7
More factors at play
in financial reports
8
Retail
chains,
investors chase law
firms ahead of FDI
deals
reduction too hot to handle but it is eager to implement the committee’s suggestions on
curbing the cash economy to counter black money. According to a senior finance ministry
official, Finance Minister P Chidambaram is in favour of launching a systematic plan to
counter black money through extension of electronic payment systems through the country,
especially covering all government transactions.
The Supreme Court has overruled its own judgment regarding the law on bounced cheques.
The Supreme Court as well as high courts have been following the wrong judgment in
several cases under the Negotiable Instruments Act. Now it has turned the law around. In
this case, the payee did not issue notice to the drawer when the cheques bounced for the
first time. He presented them again, and they bounced again. Then only he initiated
proceedings under the Act. There were contrary views on whether the proceedings were
valid if the payee did not act for the first time. Therefore the question was referred to a
larger bench. The issue was “whether the payee or holder of cheque can initiate proceedings
of prosecution for the second time if he has not initiated any action on earlier cause of
action?” Settling the law, the Supreme Court, in the latest case titled MSR Leathers vs S
Palaniappan, stated that prosecution based on the second or successive dishonour of the
cheque is also permissible. It overruled the 1998 decision in Sadanandan Bhadran’s case and
now ruled that prosecution based upon second or successive dishonour of the cheque is also
permissible.
Companies prepare financial statements for reporting to shareholders, regulators, tax
authorities, and other stakeholders such as bankers and lenders. The statements are
prepared in accordance with the accounting standards issued by the Institute of Chartered
Accountants of India, and notified by the Ministry of Corporate Affairs. However, there are
several other factors that are increasingly influencing the financial reporting process.
Leading corporate lawyers and accounting firms have swung into action to interpret the grey
areas in the multi-brand retail FDI policy and suggest follow-up action to clients before they
start striking deals. The political opposition to FDI (foreign direct investment) in retail and
states' free hand to say 'yes' or 'no' to foreign chains have made pre-deal negotiations
tougher, translating into an exciting business opportunity for law firms and advisors.
Knowing the game is big - the Indian retail sector is roughly estimated at over $500 billion
(Rs 27.5 lakh crore) and most of it is unorganised - everybody wants to grab a piece of the
pie at a time when merger and acquisition deals have dried up.
Markets as on October 8, 2012
standard.com/india/news/epayment-system-likely-to-curbblack-money/488865/
http://www.businessstandard.com/india/news/scoverrulesdecisioncheques/488795/
http://www.thehindubusinessline.c
om/industry-andeconomy/taxation-andaccounts/article3972277.ece
http://www.rediff.com/business/re
port/retail-chains-investors-chaselaw-firms/20121008.htm
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