Quvisor’s refresher on Legal updates in India: July 17, 2021


DGFT invites suggestions for New Foreign Trade Policy (2021-26) 
The Foreign Trade Policy (2015-2020), was extended till 30 September 2021. In order to prepare a new five year Foreign Trade Policy, suggestions/inputs are invited from various stakeholders.

CBIC notified exchange rates effective from July 14, 2021
The Central Board of Indirect Taxes and Customs has notified the rate of exchange of conversion of the foreign currencies into Indian currency or vice versa, with effect from 14th July, 2021, for import and export of goods.

No GST on collection and payment of exam fees on behalf of students without taking any service charges
GST : Activity of collection and payment of examination fee to American Academy of Professional coders (AAPC) by applicant institute, engaged in providing training for students in medical coding, on behalf of its students who were enrolled for training with applicant, without taking any service charges either from students or AAPC, is not chargeable to GST

Reversal of ITC: A Nightmare for bona fide purchasers
Ever since the GST came into force, the requirement of reversing the Input Tax Credit (ITC) by a bona fide purchaser on the default of the seller not depositing the tax, has been one of the most problematic issues for the registered persons.

Income tax:

Switches and routers being part of peripherals of computer system are entitled to 60% dep. : HC
INCOME TAX : Switches and routers being part of peripherals of computer system entitled to depreciation at rate of 60 per cent

Amendment by FA 2021 disallowing employee’s contribution to ESI/PF is applicable prospectively
INCOME TAX : Where ESI/PF contribution received from employees has been deposited by assessee – Employer before due date of filing section 139(1) return but after due date prescribed in corresponding statutes and Assessing Officer added said amount to income of assessee as per provisions of section 36(1)(va),

CBDT notifies certain entities for exemption under section 10(46)
The Central Board of Direct Taxes (CBDT) has notified ‘Himachal Pradesh Computerization of Police Society’ & ‘Haryana Labour Welfare Board’ for the purposes of the clause (46) of section 10 of the Income-tax Act, 1961.

CBDT notifies ‘Patanjali Research Foundation Trust’ for the purpose of sec. 35 relief
The Central Board of Direct Taxes (CBDT) has notified M/s Patanjali Research Foundation Trust, Haridwar under the category “Research Association” for Scientific Research for the purposes of section 35(1)(ii) of the Income-tax Act, 1961.

Corporate Laws:

Overview of Corporate Governance Framework in India 
The term ‘Governance’ is derived from the word ‘gubernate’ which means ‘to steer’. Steering is primarily an art of giving a direction to an organisation.

IBBI cancel registration of Registered Valuer for concealment of pending criminal proceeding 
COMPANY LAW : Where ‘G’ was granted registration as valuer by IBBI but ‘G’ concealed information of pendency of criminal proceedings against him, registration of ‘G’ as Registered Valuer was to be cancelled for violation of rule 3 of Companies (Registered Valuers and Valuation) Rules, 2017

Issuance of Bonus Non-Convertible Debentures 
Issue of Bonus Debentures, though not a recent phenomenon yet a unique concept does seem to see its glory days ahead.

Inordinate delay in filing appeal against AA’s order for SAST violations without sufficient cause to be rejected: SAT 
COMPANY LAW/SEBI : Where Adjudicating Authority passed order imposing penalty upon appellants for violating regulation 11(2) of takeover code and appeal against said order had been filed after delay of 577 days along with application seeking condonation of delay, and no sufficient cause for delay had been given in application, said application seeking condonation was to be rejected

Insolvency & Bankruptcy Code:

NCLAT is free to regulate its procedure, including issuing directions for filing of submissions and judgments: HC 
IBC : NCLAT being duly constituted Appellate Tribunal under IBC is free to regulate its procedure and manner in which it wishes to hear matters, including issuing of directions for filing of written submissions and judgments

Amount paid to corporate debtor as advance for marketing requirements can’t be considered a financial debt 
IBC : Amount paid to corporate debtor as advance for marketing/financial requirements of development project undertaken by corporate debtor could not be considered as financial debt when as per record arrangement between parties was in nature of business sharing

Termination of lease deed on Industrial property by respondent during moratorium was hit by section 14(1)(d) 
IBC : Where respondent – Industrial Development Corporation granted industrial property on lease to corporate debtor and when CIRP was initiated against corporate debtor and moratorium was declared, respondent terminated lease agreement and resumed possession of plot, action of respondents in terminating lease was hit by section 14(1)(d)


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