Budget Highlights, Finance Bill, Budget Speech and other info

• Key to Budget Documents
• Budget Highlights (Key Features)
• Budget Speech
• Budget at a Glance
• Annual Financial Statement
• Finance Bill
• Memorandum
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• The Macro Economic Framework Statement
• The Medium Term Fiscal Policy Statement
• The Fiscal Policy Strategy Statement
• Statement of Revenue Foregone
• Implementation of Budget Announcements

Economic Survey 2011

• Summary of economic Survey
• Highlights of Economic Survey
• State of the Economy and Prospects  
• Micro-Foundations of Macroeconomic Developement
• Fiscal Developments and Public Finance
• Prices and Monetary Management  
• Financial Intermediation and Markets  
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• Agriculture and Food Management  
• Industry  
• Services Sector 
• Energy, Infrastructure and Communications  
• Human Development, Equity and Environment 
• Statistical Tables  
• Economic Survey (All Chapters)

Railway Budget 2011-12

1. Highlights of Railway Budget
2. Summary of Railway Budget
3. Speech of Railway Minister
4. Other Info

Clarification in respect of Circular No. 2/2011 dated 8th February, 2011

General Circular No: 3/2011

No: 5/12/2007-CL-III

Government of India

Ministry of Corporate Affairs

5th floor, ‘A’ Wing, Shastri Bhavan,

Dr. R.P. Road, New Delhi - 110001

Dated: 21st February, 2011

To,
All Regional Directors
All Registrar of Companies

Subject: Clarification in respect of Circular No. 2/2011 dated 8th February, 2011 regarding direction under Section 212(8) of the Companies Act, 1956.

Sir,

It is clarified that this Ministry Circular No. 2/2011 dated 8th February, 2011 shall be effective in respect of balance sheet and profit and loss accounts prepared regarding the financial year ending on or after the 31st March, 2011.

Yours faithfully

(Jaikant Singh)

Director

ICAI announcement on AS 30

Application of AS 30, Financial Instruments: Recognition and Measurement, for the accounting periods ending on or before 31 st March 2011.

1 AS 30 was issued by the Institute of Chartered Accountants of India (ICAI) in 2007 but as not yet been notified by the Government under Section 211(3C) of the Companies Act, 956. As per this standard;

“Accounting Standard (AS) 30, Financial Instruments: Recognition and Measurement, issued by the Council of the Institute of Chartered Accountants of India, comes into effect in respect of accounting periods commencing on or after 1 -4-2009 and will be recommendatory in nature for an initial period of two years. This Accounting Standard will become mandatory in respect of accounting periods commencing on or after 1 -4- 2011 for all commercial, industrial and business entities except to a Small and Medium -sized Entity….”

2 AS 30 further states;

From the date this Accounting Standard becomes recommendatory in nature, the following Guidance Notes issued by the Institute of Chartered Accountants of India,stand withdrawn:

(i) Guidance Note on Guarantees & Counter Guarantees Given by the Companies.

(ii) Guidance Note on Accounting for Investments in the Financial Statements of Mutual funds.

(iii) Guidance Note on Accounting for Securitisation.

(iv) Guidance Note on Accounting for Equity Index and Equity Stock Futures and Options.”

3 Subsequent to the issuance of AS 30, the world witnessed financial crisis which raised issues with regard to accounting treatment of financial in struments. Accordingly, various accounting standards setting bodies including the ICAI examined these aspects. Insofar as International Accounting Standards Board is concerned certain modifications have been made in the corresponding International Account ing Standard, viz., IAS 39, Financial Instruments: Recognition and Measurement . The International Accounting Standards Board has also issued IFRS 9, Financial Instruments, which replaces certain requirements contained in IAS 39 and it is expected that ultimately the entire IAS 39 on which AS 30 is based is not expected to be replaced before June 30, 2011 as presently committed by IASB. Accordingly, AS 30 is not expected to continue in its present form including for those entities for which converged Indi an Accounting Standards will come into force from 1st April, 2011. In this changed scenario, the Council has reconsidered the matter regarding the status of the existing AS-30 and has decided to issue the following clarification for the guidance of the Members and others concerned.

4 It is clarified that in respect of the financial statements or other financial information for the accounting periods commencing on or after 1 st April 2009 and ending on or before 31 st March 2011, the status of AS 30 would be as below:

(i) To the extent of accounting treatments covered by any of the existing notified accounting standards (for eg. AS 11, AS 13 etc,) the existing accounting standards would continue to prevail over AS 30.

(ii) In cases where a relevant regul atory authority has prescribed specific regulatory requirements (eg. Loan impairment, investment classification or accounting for securitizations by the RBI ,etc), the prescribed regulatory requirements would continue to prevail over AS 30.

(iii) The preparers of the financial statements are encouraged to follow the principles  enunciated in the accounting treatments contained in AS 30 . The aforesaid is, however, subject to (i) and ( ii) above.

5. From 1st April 2011 onwards,

(i) the entities to which converged Indian accounting standards will be applied as per the roadmap issued by MCA, the Indian Accounting Standard (Ind AS) 39, Financial Instruments; Recognition and Measurement , will apply.

(ii) for entities other than those covered under paragraph 5(i) above, the status of AS 30 will continue as clarified in paragraph 4 above .

6. The abovementioned clarifications would also be relevant to the existing AS 31, Financial Instruments: Presentation and AS 32, Financial Instruments: Disclosures as well as for Ind AS 32, Financial Instruments: Presentation and Ind AS 107, Financial Instruments: Disclosures , after 1st April 2011 onwards.

Amendment to Schedule XIII to the Companies Act, 1956

Amendment to Schedule XIII of the Companies Act, 1956 for definition of Remuneration Committee.

Click here for the text of the notification GSR 70 (E)

Date of filling of ITR-V extended to 31st July, 2011

The Central Board of Direct Taxes has decided to extend the time limit for filing ITR-V forms relating to income tax returns for A.Y 2010 - 2011 filed electronically on or before 1st April 2010 to 31st July, 2011.

Click here for the text of the order under section 119(2)(b) of the Income Tax Act, 1961. 

CBDT Press Release on enhancement of limit for appeal filing, speeding of refunds and signing of TIEA between India and British Virgin Islands

No.402/92/2006-MC (03 of 2011)

Government of India / Ministry of Finance

Department of Revenue

Central Board of Direct Taxes

***

New Delhi dated the 10th February 2011

PRESS RELEASE

India has entered into its third Tax Information Exchange Agreement (TIEA) with the British Virgin Islands. The Agreement was signed on 9th February 2011 by the High Commissioner of India to United Kingdom on behalf of India and the Deputy Premier on behalf of British Virgin Islands. The agreement provides for sharing information, including exchange of banking and ownership information, and also of past information in criminal tax matters. Earlier, India had signed similar TIEAs with Isle of Man and Bermuda.

In order to further reduce litigation, the Central Board of Direct Taxes (CBDT) has enhanced the limits for filing appeals against taxpayers in the Income Tax Appellate Tribunal, High Court and Supreme Court, from tax effect of Rs.2 lakh, Rs.4 lakh and Rs.10 lakh, respectively, to Rs.3 lakh, Rs.10 lakh and Rs.25 lakh, respectively.

In order to speed up refunds, TDS claims in all tax returns (ITR-1 to ITR-6) will be accepted without verification if the difference between the amount claimed in the return and the amount reflected in the TDS return (AS-26 statement) does not exceed one lakh rupees. This will enable the Income Tax department clear nearly 95 percent refunds without verifying each TDS claim. Cases with zero-matching, invalid TAN and difference exceeding Rs. 1 lakh will, however, be cleared only after due verification. This precaution is necessary to avoid refund frauds.

Earlier, the Chairman CBDT had directed all Chief Commissioners to upload necessary data so that the refunds can be issued expeditiously. It will be for the first time that most income tax refunds of the current assessment year will be dispatched to the taxpayers within the current financial year itself.

XXX

General Exemption under Section 211 for Public Financial Institutions

Government of India

Ministry of Corporate Affairs

Press Note No.5/2011 dated 8.2.2011

General Exemption under Section 211

1. Section 211 of the Companies Act, 1956 requires that the balance sheet and profit and loss account of a company shall be in the form set out in Part I of Schedule VI or in such other form as may be approved by the Central Government either generally or in any particular case. The Ministry has been regularly receiving requests for exemption from various classes of companies from the disclosure of certain quantitative details required under Schedule VI. So far, these exemptions were being given on a case-by-case basis with certain conditions.

2.With a view to simplifying the process, the Central Government has, by notification, issued a general exemption whereby the Public Financial Institutions will be exempted from disclosing Investments as required under paragraph (1) of Note (1) of Part-I of Schedule VI in their balance sheet subject to fulfillment of the following conditions, namely:-

(i)the Public Financial Institutions shall make the complete disclosures about investments in the balance sheet in respect of the following, namely: -

(a)immovable property;

(b)capital of Partnership firms;

(c)all unquoted investments and;

(d)investments in subsidiary companies.

(ii)the Public Financial Institutions shall disclose the total value of quoted investments in each of the following respective categories, namely:-

(a)Government and trusts securities;

(b)shares;

(c)debentures;

(d)bonds; and

(e)other securities.

(iii)in each of the above categories referred to in sub-paragraphs (i) and (ii), investments where value exceeds two percent of total value in each category or one crore rupees, whichever is lower, shall be disclosed fully provided that where disclosures do not result in disclosure of at least fifty percent of total value of investment in a particular category, additional disclosure of investments in descending order of value shall be made so that specific disclosures account for at least fifty percent of the total value of investments in that category;

(iv)the Public Financial Institutions shall also give an undertaking to the effect that as and when any of the shareholders ask for specific particulars the same shall be provided;

(v)all unquoted investments shall be separately shown;

(vi) the company shall undertake to file with any other authorities, whenever necessary, all the relevant particulars as may be required by the Government or other regulatory bodies;

(vii)the Investments in subsidiary companies or in any company such that it becomes a subsidiary, shall be fully disclosed.

Copy of Notification S.O. 300(E) 08-02-2011

Managerial Remuneration in unlisted companies having no profits/ inadequate profits

Government of India

Ministry of Corporate Affairs

Press Note No. 4/2011 dated 8.2.2011

Managerial Remuneration in unlisted companies having no profits/ inadequate profits

1.Companies are divided into private limited and public limited companies. Public limited companies are of two types – listed companies (whose shares are listed on a stock exchange) and unlisted companies. Normally, the general public does not hold shares in unlisted companies. Private limited companies are not subject to any limits on managerial remuneration. Public limited companies (listed and unlisted) with no profits/ inadequate profits are currently required to approach the Ministry for approval in those cases where the remuneration of Directors/ equivalent managerial personnel exceeds certain limits.

2.The matter has been re-examined in the light of the evolving economic and regulatory environment. The primary purpose of regulations over managerial remuneration is to protect stakeholders, particularly shareholders and creditors. Unlisted companies are in several respects similar to private limited companies. A substantial number of the applications coming to the Ministry fall under this category and the Ministry’s limited manpower is disproportionately involved in this exercise. In the case of unlisted companies so long as the conditions specified in Schedule XIII, including special resolution of shareholders and absence of default on payment to creditors, are fulfilled approval will not be needed hereafter.

3.Accordingly, Schedule XIII of the Companies Act 1956 is being amended to provide that unlisted companies (which are not subsidiaries of listed companies) shall not require Government approval for managerial remuneration in cases where they have no profits/ inadequate profits, provided they meet the other conditions stipulated in the Schedule.

General Exemption under section 211

The Central Government has, by notification, issued a general exemption whereby certain categories of companies will be exempted from the certain disclosures under Part I of the Schedule VI.

Click here for the Press Note No. 2/2011 dated 8.2.2011 for further details. 

Copy of Notification S.O. 301(E) 08-02-2011

SEBI Board Meeting

PR No.24/2011

SEBI Board meeting

The Board met today in Mumbai and took the following decisions:

1. ASBA facility mandatory for QIBs and NIIs:

The ASBA facility shall be mandatory for non-retail investors (Qualified Institutional Buyers and Non-Institutional Investors) making applications in public / rights issues with effect from May 01, 2011.

2. Initial registration of intermediaries to be for five years:

The intermediaries would be granted registration initially for a period of five years. On assessment of the performance of the intermediary and its track record during the initial five years, it will be granted registration on permanent basis.

3. Self clearing members for currency derivative segment:

The currency derivative segment would have self clearing members. They would be required to have net worth of ` 5 crore.

4. Recommendation to MCA on related party transactions :

SEBI will recommend to the Ministry of Corporate Affairs to suitably amend Clause 166 of the Companies Bill, 2009 to disallow interested shareholders from voting on the special resolution of the prescribed related party transaction. This will protect small and diversified shareholders in listed companies from abusive related party transactions. This view was taken based on the learning from the investigation in the matter of Satyam Computer Services Limited.

Mumbai

February 07, 2011



Direction under Section 212(8) of the Companies Act, 1956

General Circular No: 2 /2011

No: 5/12/2007-CL-III

Government of India

Ministry of Corporate Affairs

5th floor, `A' Wing, Shastri Bhavan,

Dr. R.P. Road, New Delhi-110 001.

Dated: 8th February, 2011

To

All Regional Directors

All Registrar of Companies

Subject: Direction under Section 212(8) of the Companies Act, 1956.

Sir,

It has been noticed that a large number of companies are approaching the Ministry for exemption under Section 212(8) of the Companies Act, 1956. The matter was examined in the context of the globalizing Indian economy, the increased number of subsidiaries, and the introduction of accounting standards on consolidated financial statements. It has been decided to grant a general exemption provided certain conditions are fulfilled.

The Central Government hereby directs that provisions of Section 212 shall not apply in relation to subsidiaries of those companies which fulfil the following conditions:-

(i) The Board of Directors of the Company has by resolution given consent for not attaching the balance sheet of the subsidiary concerned;

(ii) The company shall present in the annual report, the consolidated financial statements of holding company and all subsidiaries duly audited by its statutory auditors;

(iii) The consolidated financial statement shall be prepared in strict compliance with applicable Accounting Standards and, where applicable, Listing Agreement as prescribed by the Security and Exchange Board of India;

(iv) The company shall disclose in the consolidated balance sheet the following information in aggregate for each subsidiary including subsidiaries of subsidiaries:- (a) capital (b) reserves (c) total assets (d) total liabilities (e) details of investment (except in case of investment in the subsidiaries) (f) turnover (g) profit before taxation (h) provision for taxation (i) profit after taxation (j) proposed dividend;

(v) The holding company shall undertake in its annual report that annual accounts of the subsidiary companies and the related detailed information shall be made available to shareholders of the holding and subsidiary companies seeking such information at any point of time. The annual accounts of the subsidiary companies shall also be kept for inspection by any shareholders in the head office of the holding company and of the subsidiary companies concerned and a note to the above effect will be included in the annual report of the holding company. The holding company shall furnish a hard copy of details of accounts of subsidiaries to any shareholder on demand;

(vi) The holding as well as subsidiary companies in question shall regularly file such data to the various regulatory and Government authorities as may be required by them;

(vii) The company shall give Indian rupee equivalent of the figures given in foreign currency appearing in the accounts of the subsidiary companies along with exchange rate as on closing day of the financial year;

Yours faithfully

(Jaikant Singh)

Director

Revised forms relating to reporting for FDI in India

RBI has revised following forms for reporting of FDI in India.

1. Advance reporting and KYC form


2. FCGPR Part A

3. FCGPR Part B

4. FC TRS

Easy Exit Scheme , 2011 extended up to 30th April, 2011

General Circular No. 1/2011

F. No. 2/7/2010-CL V

Government of India

Ministry of Corporate Affairs

5 th Floor, ‘A’ Wing, Shastri Bhavan,

Dr. R.P. Road , New Delhi

Dated the 3 rd Feb, 2011

To All Regional Director,
All Registrar of Companies.

Subject: Easy Exit Scheme , 2011

Sir,

1.In continuation to this Ministry’s earlier circular no. 6/2010 dated 03.12.2010 on the subject cited above, it has been decided to extend the Scheme for another three months i.e. upto 30 th April, 2011.

2. All the terms of circular no. 6/2010 dated 03.12.2010 will remain the same.

Yours faithfully,

 

 

(Monika Gupta)

Assistant Director