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Clarification on Aadhaar sharing issue by UIDAI (Press Release 29th May 2022)

Posted on by Business So Simple in Public Affairs

This is in pursuant of the Press Release dated 27 May 2022 by the Bengaluru Regional Office, UIDAI.

It is learnt that it was issued by them in the context of an attempt to misuse a photoshopped Aadhaar card. The release advised the people to not to share photocopy of their Aadhaar with any organization because it can be misused. Alternatively, a masked Aadhaar which displays only the last 4 digits of Aadhaar number, can be used.

However, in view of the possibility of the misinterpretation of the Press Release, the same stands withdrawn with immediate effect.

UIDAI issued Aadhaar card holders are only advised to exercise normal prudence in using and sharing their UIDAI Aadhaar numbers.

Aadhaar Identity Authentication ecosystem has provided adequate features for protecting and safeguarding the identity and privacy of the Aadhaar holder.

Sources : Ministry of Electronics & IT

Bar of voting as per Section 188 of the Companies Act, 2013 on related parties operated only at the time of entering into a contract or arrangement  (SEBI Vs R.T. Agro Private Limited (Supreme Court) dated 25 April 2022)

Posted on by Business So Simple in Company Law, Court Room, Legal awareness, Miscellaneous

APPELLANT: SEBI

RESPONDENTS: R.T. AGRO PRIVATE LIMITED & ORS.

Legal provisions:
188. Related party transactions   (1) Except with the consent of the Board of Directors given by a resolution at a meeting of the Board and subject to such conditions as may be prescribed, no company shall enter into any contract or arrangement with a related party with respect to— (a) sale, purchase or supply of any goods or materials; (b) selling or otherwise disposing of, or buying, property of any kind; (c) leasing of property of any kind; ——————————————————— [Provided that no contract or arrangement, in the case of a company having a paid-up share capital of not less than such amount, or transactions exceeding such sums, as may be prescribed, shall be entered into except with the prior approval of the company by a Special resolution ( Resolution substituted by Companies (Amendment) Act, 2015 and is effective from 29th May, 2015.):   [Provided further that no member of the company shall vote on such [resolution], to approve any contract or arrangement which may be entered into by the company, if such member is a related party:]]

Having heard learned counsel for the appellant-Securities and Exchange Board of India (‘SEBI’) and having perused the material placed on record, we find absolutely no reason to entertain this appeal.

The company R. T. Exports Limited proposed to enter into a transaction with one Neelkanth Realtors Private Limited for purchase of 40,000 sq. ft. of residential space. This proposal was treated as a related party transaction and was required to be approved by the shareholders of the Company. Accordingly, a special resolution was approved by R. T. Exports Limited on 15.07.2014. In terms of Section 188 of the Companies Act, 2013, the related parties abstained from voting on this special resolution. Thereafter, an Extra-Ordinary General Meeting was convened on 16.12.2016 for rescinding the resolution dated 15.07.2014 in which, the related parties also voted.

However, the appellant-SEBI took up the matter on a complaint and issued notice alleging violation of Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Adjudicating Officer, ultimately, proceeded to penalise the present respondents 1 with a cumulative sum of Rs. 35 lakhs for the alleged violation of the said Regulation 23.

The Securities Appellate Tribunal has not approved this order passed by the Adjudicating Officer and has allowed the appeal filed by the present respondents while, inter alia, holding that the bar of voting as per Section 188 of the Companies Act, 2013 on related parties operated only at the time of entering into a contract or arrangement, i.e., when the resolution dated 15.07.2014 was passed; and therein the said related parties indeed abstained from voting. The Appellate Tribunal found no fault in the said parties voting in the recalling/rescinding of the said resolution.

The view, as taken by the Appellate Tribunal, in the given set of facts and circumstances of the present case, appears to be a plausible view of the matter. In fact, nothing of ill-intent on the part of the respondents has been established in the present case. The hyper-technical stance of the appellant could have only been, and has rightly been, disapproved on the given set of facts and circumstances.

The appeal fails and is, therefore, dismissed.

All pending applications stand disposed of.

Relaxation in paying additional fees in case of delay in filing Form 11(Annual Return) by Limited Liability Partnerships up to 30th June, 2022 (MCA Circular dated 27 May 2022)

Posted on by Business So Simple in Company Law, LLP

This Ministry has received representation seeking extension on timelines for filing the Annual Return (Form 11) by LLPs without paying additional fees. In view of transition from version-2 of MCA-21 to version-3 and to promote compliance on part of LLPs, it has been decided to allow LLPs to file e-Form 12 (Annual Return of Limited Liability Partnership) for the Financial Year 2021-2022 without paying additional fees upto 30th June,2022.

Refer MCA Circular

New Guidelines of Micro & Small Enterprises Cluster Development Programme (MSE-CDP) approved

Posted on by Business So Simple in MSME

The Government has approved New Guidelines of Micro & Small Enterprises Cluster Development Programme (MSE-CDP), which will be implemented during 15th Finance Commission Cycle(2021-22 to 2025-26). The scheme aims at enhancing the competitiveness and productivity of Micro & Small Enterprises by undertaking interventions such as:

  1. Common Facility Centers (CFCs): The central government grant will be restricted to 70% of the cost of project from Rs. 5.00 crore to Rs. 10.00 crore and 60% of the cost of project from Rs. 10.00 crore to Rs. 30.00 crore. In case of NE & Hill States, Island territories, Aspirational Districts, government grant will be 80% of the cost of project from Rs. 5.00 crore to Rs. 10.00 crore and 70% of the cost of project from Rs. 10.00 crore to Rs. 30.00 crore. The project for CFC with project cost more than Rs. 30.00 crore shall also be considered but the Government assistance would be calculated by taking into account the maximum eligible project cost of Rs.30.00 crore.
  2. Infrastructure Development: The central government grant will be restricted to 60% of the cost of project from Rs. 5.00 crore to Rs. 15.00 crore for setting up of new Industrial Estate / Flatted Factory Complex and  grant will be 50% of the cost of project from Rs. 5.00 crore to Rs. 10.00 crore for up-gradation of existing Industrial Estate / Flatted Factory Complex. In case of NE & Hill States, Island territories, Aspirational Districts,  grant will be 70% of the cost of project from Rs. 5.00 crore to Rs. 15.00 crore for setting up of new Industrial Estate / Flatted Factory Complex and 60% of the cost of project cost from Rs. 5.00 crore to Rs. 10.00 crore for up-gradation of existing Industrial Estate / Flatted Factory Complex. The project for ID with project cost more than Rs. 10.00 crore/15.00 crore can also be considered but the government assistance would be calculated by taking into account the maximum eligible project cost of Rs. 10.00 crore/15.00 crore.

The New guidelines of MSE-CDP are available on the website of the Office of DC(MSME).

Sources: Ministry of Micro,Small & Medium Enterprises dated 27 May 2022

Kolkata ROC adjudication order for violation of Section 134 of the Companies Act, 2013 in the matter of M/s Kejriwal Castings Limited

Posted on by Business So Simple in Company Law, Legal awareness
https://youtu.be/MbeijEw1UjM

Kolkata ROC adjudication order for violation of Section 134 of the Companies Act, 2013 in the matter of M/s Kejriwal Castings Limited

Facts

Suo motu application filed by Co. & MD for adjudication of offence for contravention of Section 134 of CA 2013 for Board Report not prepared on due time

Penalty imposed

On Company : Rs. 6 Lakhs
On MD : Rs. 1 Lakh

Refer Rulings:

RBI Constitutes Committee for Review of Customer Service Standards in RBI Regulated Entities

Posted on by Business So Simple in Banking, RBI

As part of the Statement on Developmental and Regulatory Policies released along with the Monetary Policy Statement on April 08, 2022, the Reserve Bank of India had announced setting up of a Committee for Review of Customer Service Standards in RBI Regulated Entities (REs) for examining and reviewing the state of customer service in the REs and adequacy of customer service regulations and suggest measures to improve customer service. Accordingly, the Reserve Bank of India has constituted a Committee with the following composition:

Chief General Manager, Consumer Education and Protection Department, Central Office, Reserve Bank of India will be the member secretary of the Committee. The Committee may also invite domain experts and RBI officials, as may be required, for consultations and/or to participate in its deliberations. The terms of reference of the Committee will be as under:

  1. Evaluate the efficacy, adequacy and quality of customer service in entities regulated by RBI vis-à-vis the existing RBI guidelines on customer service and identify gaps, if any;
  2. Review the emerging and evolving needs of the customer service landscape, especially in the context of evolving digital/ electronic financial products and distribution landscape and suggest suitable regulatory measures;
  3. Identify the best practices, adopted globally and domestically, in customer service and grievance redressal, especially for improvement in services rendered to retail and small customers, including pensioners and senior citizens;
  4. Suggest measures to leverage technology for enhancing customer service efficiencies, upgrading internal grievance redress mechanism in REs and strengthening the overall consumer protection framework of RBI;
  5. Any other matter relevant to customer service and consumer protection.

The Committee will submit its report within three months from the date of its first meeting.

RBI Press Release: 2022-2023/251 dated 23 Nay 2022

Reserve Bank cancels Certificate of Registration (CoR) of five NBFCs due to irregular lending practices

Posted on by Business So Simple in Banking, RBI

In exercise of the powers conferred under Section 45-IA (6) (iv) of the Reserve Bank of India Act, 1934, the Reserve Bank has cancelled the Certificate of Registration (CoR) issued to the following five Non-Banking Financial Companies (NBFCs):

As such, the above companies shall not transact the business of a Non-Banking Financial Institution (NBFI), as defined in clause (a) of Section 45-I of the RBI Act, 1934.

The CoR of the abovementioned NBFCs have been cancelled on account of violation of RBI guidelines on outsourcing and Fair Practices Code in their digital lending operations undertaken through third party apps which was considered detrimental to public interest. These companies were also not complying with the extant regulations pertaining to charging of excessive interest and had resorted to undue harassment of customers for loan recovery purposes.

RBI Press Release: 2022-2023/265

Delhi Customs launches Project ‘NIGAH’ at ICD Garhi Harsaru, Gurugram.Project aims at container tracking and monitor timely clearances to ensure Ease of Doing Business

Posted on by Business So Simple in Business Consultancy, Entrepreneurship

Chief Commissioner, Delhi Customs Zone, Shri Surjit Bhujabal inaugurated project ‘NIGAH’ at ICD Garhi Harsaru, Gurugram, here today.

Project NIGAH is an initiative to track container by using ICTM (ICD Container Tracking Module) which will help in better visibility of the container movement inside the ICD. It will help Customs to expedite long standing containers and monitor timely clearances, thereby enhancing Ease of Doing Business along with ensuring lead preventive checks. ICTM has been developed in collaboration with the Custodian M/s. GRFL. A live demo of the project was given to all the participants.

On this occasion, the Chief Commissioner thanked the Custodian M/s. GRFL for this innovative development at local level to provide granular level visibility supporting ease of monitoring and to synergise the technological platforms introduced by the government with other stakeholders’ platforms, which will lead India to high standards of EXIM trade. He encouraged other Custodians to replicate the project at ICDs for the benefit of trade.

The function was attended by Commissioner of Customs, ICD Patparganj & Other ICDs Sh. Manish Saxena; Additional Commissioner of Customs Sh. Jayant Sahay; Deputy Commissioner of port Sh Sunil Shrivastava and Smt Jaya Kumari, Vice-President of M/s. GRFL Sh Rajguru with his team; Custodians of ICD Sonepat and ICD Patli and Sh. Puneet Jain, President of Delhi Customs Brokers Association along with other office-bearers. The function was virtually attended by Officers and Custodians of Other ICDs of the Patparganj Commissionerate.

MoF Press Release dated 26 May 2022

Fake reviews on E-Commerce platforms under Centre’s radar

Posted on by Business So Simple in Business Consultancy, Entrepreneurship

Fake reviews on E-Commerce platforms under Centre’s radar


Department of Consumer Affairs to hold meeting with E-Commerce entities and stakeholders to discuss magnitude of fake reviews and prepare a roadmap ahead

To gauge the magnitude of fake reviews on E-Commerce platforms which mislead consumers into buying online services or products and to prepare a roadmap ahead, the Department of Consumer Affairs (DoCA) in association with the Advertising Standards Council of India (ASCI) will be holding a virtual meeting on Friday, 27th May, 2022 along with various stakeholders.

The discussions will be broadly based on the impact of fake and misleading reviews on consumers and possible measures to prevent such anomaly. In this regard, Secretary DoCA, Shri Rohit Kumar Singh has written to all stakeholders: E-Commerce entities like Flipkart, Amazon, Tata Sons, Reliance Retail and others besides, Consumer Forums, Law Universities, Lawyers, FICCI, CII, Consumer Rights Activists etc. to participate in the meeting.

Along with the letter, Shri Singh has also shared a Press Release of European Commission dated January 20th, 2022 highlighting results of an EU-wide screening on online consumer reviews across 223 major websites. The screening results underlines that at least 55% of the websites violate the unfair commercial Practices Directive of the E.U. which requires truthful information to be presented to consumers to make an informed choice. Further, in 144 out of the 223 websites checked, the authorities could not confirm that traders were doing enough to ensure that reviews were authentic, i.e., if they were posted by consumers who had actually used the product or service that was reviewed.

The letter states that ‘It is relevant to mention that with growing internet and smartphone use, consumers are increasingly shopping online to purchase goods and services.  Given that e-commerce involves a virtual shopping experience without any opportunity to physically view or examine the product, consumers heavily rely on reviews posted on e-commerce platforms to see the opinion and experience of user who have already purchased the goods or service. As a result, due to fake and misleading reviews, the right to be informed, which is a consumer right under the Consumer Protection Act, 2019 is violated.’

‘Since the issue impacts people shopping online on a daily basis and has a significant impact on their rights as a consumer, it is important that it is examined with greater scrutiny and detail,’ the letter states.

Press Release 26 May 2022