investment by non residents

All new issuances of government securities in the 14 - year and 30 year tenors are excluded for investment by non residents. All other investments in government securities are available under the fully accessible route. 

RBI Circular dated 29th July, 2-24 to that effect follows

 A reference is invited to the Fully Accessible Route introduced by the Reserve Bank, vide A.P. (DIR Series) Circular No. 25 dated March 30, 2020, wherein certain specified categories of Central Government securities were opened fully for non-resident investors without any restrictions, apart from being available to domestic investors as well.

2. The Government Securities that are eligible for investment under the Fully Accessible Route (‘specified securities’) were notified by the Bank, vide circular no. FMRD.FMSD.No.25/14.01.006/2019-20 dated March 30, 2020, circular no. FMRD.FMID.No.04/14.01.006/2022-23 dated July 07, 2022, circular no. FMRD.FMID.No. 07/14.01.006/2022-23 dated January 23, 2023 and FMRD.FMID.No. 04/14.01.006/2023-24 dated November 08, 2023.

3. On a review and in consultation with the Government, it has been decided to exclude all new securities of 14-year and 30-year tenors from the Fully Accessible Route. Consequently, future issuances of Government Securities in these tenors shall not be available for investment under the Fully Accessible Route. Existing stocks of Government Securities in 14-year and 30-year tenors already included as ‘specified securities’ under the Fully Accessible Route shall, however, continue to be available under the Fully Accessible Route for investments by non-residents in the secondary market.

4. Investments by Foreign Portfolio Investors in new Government Securities in 14-year and 30-year tenors issued henceforth shall be either reckoned under the investment limits prescribed in A.P. (DIR Series) Circular No. 03 dated April 26, 2024, as amended from time to time, and subject to conditions stipulated in A.P. (DIR Series) Circular No.31 dated June 15, 2018, as amended from time to time or reckoned under investment limits and subject to conditions stipulated in A.P. (DIR Series) Circular No.22 dated February 10, 2022, as amended from time to time, as the case may be.

5. The Directions contained in this circular have been issued under Section 45W of Chapter IIID of the Reserve Bank of India Act, 1934 and are without prejudice to permissions/ approvals, if any, required under any other law.

6. These Directions shall be applicable with immediate effect.

Mannappuram Finance

 The Reserve Bank of India (RBI) has imposed monetary penalty on the following two Payment System Operators (PSOs) for non-compliance with certain provisions of the Master Direction – Know Your Customer (KYC) Direction, 2016 dated February 25, 2016 (as updated from time to time).

S.No.	Name of the PSO	Speaking Order dated	Amount of Penalty (₹ lakh)
1	Manappuram Finance Limited	July 16, 2024	41.50
2	Ola Financial Services Pvt. Ltd.	July 16, 2024	33.40

Compounding Orders were also issued to two PSOs i.e. Ola Financial Services Pvt. Ltd. and Visa Worldwide Pte. Limited, for contravention of certain provisions contained in the Master Directions on Prepaid Payment Instruments (PPIs) dated August 27, 2021 (as updated from time to time) and Card Not Present transactions – Relaxation in Additional Factor of Authentication for payments upto ₹2000/- for card network provided authentication solutions dated December 06, 2016, respectively.

S.No.	Name of the PSO	Compounding Order dated	Compounding Amount (₹ lakh)
1	Ola Financial Services Pvt. Ltd.	July 05, 2024	54.15
2	Visa Worldwide Pte. Limited	July 16, 2024	240.75

The above actions have been taken in exercise of powers vested in RBI under the provisions of Section 30 and Section 31 of the Payment and Settlement Systems Act, 2007 and are based on deficiencies in regulatory compliance and are not intended to pronounce upon the validity of any transaction or agreement entered into by the entity with its customers.

Background

Manappuram Finance Limited and Ola Financial Services Pvt. Ltd.

Both the entities were non-compliant with the directions issued by RBI on KYC requirements. Accordingly, notices were issued to the entities advising them to show cause as to why penalty should not be imposed for non-compliance with the directions. After considering their written responses and the oral submissions made during the personal hearing, RBI concluded that the aforesaid charges of non-compliance with RBI directions were substantiated and warranted imposition of monetary penalty.

Further, Ola Financial Services Pvt. Ltd. had also reported instances of shortfall in the balance in its escrow account and filed an application for compounding of the violation. After analysing the compounding application and oral submissions made during the personal hearing, RBI determined that the aforementioned contravention can be compounded.

Visa Worldwide Pte. Limited

It was observed that the entity had implemented a payment authentication solution without regulatory clearance from RBI. Accordingly, notice was issued to the entity advising it to show cause as to why penalty should not be imposed for non-compliance with the directions. The entity in its response had filed an application for compounding of the violation. After analysing the compounding application and oral submissions made during the personal hearing, RBI determined that the aforementioned contravention can be compounded.

Muthoot Finance

 The Reserve Bank of India (RBI) has, by an order dated July 15, 2024, imposed a monetary penalty of ₹1,90,000/- (Rupees One Lakh Ninety Thousand only) on Muthoot Finance Limited (the company) for non-compliance with certain provision of ‘Know Your Customer (KYC) Directions, 2016’ issued by RBI. 

The statutory inspection of the company was conducted by RBI with reference to its financial position as on March 31, 2022. Based on supervisory findings of non-compliance with RBI directions and related correspondence in that regard, a notice was issued to the company advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said directions.

After considering the company’s reply to the notice, oral submissions made by it during the personal hearing, RBI found, inter alia, that the charge of allotting more than one Unique Customer Identification Code (UCIC) to its individual customers was sustained, warranting imposition of monetary penalty.

This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the company with its customers. Further, imposition of this monetary penalty is without prejudice to any other action that may be initiated by RBI against the company.

Kiss and Tell

 Fast paced romantic comedy “Kiss and Tell” by Donna Hay.

Jo is a lead actress in a favorite soap show on television. She is a mother to two young girls with the husband having walked away from marriage. The show ratings are dropping so the producers bring in Grim Reaper a.k.a. Richard Black to reverse the trend.

Richard is known for his tough business moves and everybody is fearing for their job. But slowly Jo realises there is another side to Richard character, one which fascinates her.

Tumultuous co characters manage to downside her reputation a bit but Richard comes to the rescue. After much comic interactions between the various characters whose real side is revealed very slowly in the plot, the two i.e. Jo and Richard get along well.

Her daughters also start liking Richard so much that she harbours thoughts of a life with Richard. Nice plot with not many characters (thankfully) and narrative is also good. Goodreads 3/5

GST registration

 Business for New Registration and Amendment

Jul 9th, 2024

Dear Taxpayer,

GSTN is pleased to inform that changes have been made in size of document upload in Principal Place of Business and Additional Place of Business for New Registration and Amendment catering to the grievances received in the matter from trade.

Taxpayer can now upload following documents up to maximum size of 500 kb in the Principal Place of Business tab and Additional Places of Business tab as mentioned below:-

Document type	Document Name	Earlier Document Size	Document size increased now	Type of Document
Proof of Principal Place of Business and Additional Place of Business	1.   Municipal Khata Copy 2.   Electricity Bill 3.   Consent Letter 4.   Property Tax Receipt	100 KB	500 KB	JPEG/PDF

Remittances to IFSCs under LRS

 RBI Circular dated 10th July, 2024, which is self explanatory.

Attention of Authorised Persons is invited to A.P. (DIR Series) Circulars, i.e., No.11 dated February 16, 2021, No.03 dated April 26, 2023, and No.06 dated June 22, 2023, on remittances to International Financial Services Centres (IFSCs) in India under the Liberalised Remittance Scheme (LRS) and the Master Direction No. 7/2015-16 on LRS dated January 01, 2016 (as amended from time to time).

2. At present, remittances under LRS to IFSCs can be made only for:

1. Making investments in IFSCs in securities except those issued by entities/ companies resident in India (outside IFSC); and

2. Payment of fees for education to foreign universities or foreign institutions in IFSCs for pursuing courses mentioned in the gazette notification no. SO 2374(E) dated May 23, 2022, issued by the Central Government.

For these permissible purposes, resident individuals can open Foreign Currency Account (FCA) in IFSCs.

3. On a review, it has been decided that Authorised Persons may facilitate remittances for all permissible purposes under LRS to IFSCs for:

1. Availing financial services or financial products as per the International Financial Services Centres Authority Act, 2019 within IFSCs; and

2. All current or capital account transactions, in any other foreign jurisdiction (other than IFSCs) through an FCA held in IFSCs.

For these permissible purposes, resident individuals can open Foreign Currency Account (FCA) in IFSCs.

4. Authorised Persons shall bring the contents of this circular to the notice of their constituents and customers. The Master Direction No.7/2015-16 on LRS is being updated to reflect these changes.

CCPA order against Yatra

 It came to the notice of the Central Consumer Protection Authority (CCPA) through National Consumer Helpline (1915-toll free number) that many grievances were lodged relating to non-refund of cancelled air tickets on account of COVID-19 lock down wherein the consumers had alleged that the travel agencies informed them that refunds have not been received from the airlines etc.

The Apex Court in its decision in Pravasi Legal Cell vs Union of India (W.P.(C)D.No.10966 of 2020) dated 01.10.2020 had directed that:

"If the tickets have been booked during the lockdown period through a travel agent for a travel within the lockdown period, in all such cases full refund shall be given by the airlines immediately. On such refund, the amount shall be passed on immediately by the agent to the passengers".

In light of the above, the CCPA initiated suo-moto action against Yatra regarding non refund of airline tickets cancelled due to Covid-19 lockdown.

Show Cause Notice vide dated 09.03.2021 was sent to this travel company regarding pendency of refunds of bookings which got affected in Covid-19. In pursuant to that CCPA conducted several hearings of the Company and closely monitor the progress of refunds made to the consumers.

From July 8, 2021, to June 25, 2024, the CCPA conducted several hearings to address these issues. As a result of these efforts, Yatra Online Limited has made significant progress in reducing the total number of pending refund bookings. In 2021, there were 36,276 pending bookings amounting to ₹26,25,82,484. As of June 21, 2024, this number has been significantly reduced to 4,837 bookings, amounting to ₹2,52,87,098. Yatra has refunded approx 87% amount to consumers and further endeavor to refund approx 13% amount to consumers in order to ensure that all pending refunds are processed promptly and efficiently by airlines.

In 2021, there were total 5,771 bookings pertaining to airlines pending for refunds amounting to ₹9,60,14,463. By 2024, Yatra has reduced the pendency of airlines to 98 bookings with an outstanding amount of ₹31,79,069. CCPA vide order dated 27.06.2024 directed 22 remaining airlines of Yatra to expeditiously refund ₹31,79,069 to consumers.

During the proceedings held before CCPA, several other travel platforms like MakeMyTrip, EaseMyTrip, ClearTrip, Ixigo and Thomas Cook have refunded the entire amount to Consumers whose tickets got affected due to Covid-19 lockdown.

To further facilitate timely processing of refunds to consumers, CCPA issued an order on 27.06.2024 wherein it directed Yatra to set up dedicated arrangements at the National Consumer Helpline (NCH). Specifically, Yatra is required to allocate five exclusive seats at NCH for making calls to the remaining 4,837 passengers informing them that their pending refunds due to COVID-19 lockdown-related flight cancellations will be processed. The costs incurred for engaging these five dedicated personnel will be fully covered by Yatra with payments made directly to the agency managed by NCH.

The CCPA's order reinforces the importance of timely refunds and Yatra is directed to adhering to this directive to ensure complete resolution for all pending bookings.

Amendments to TRAI regulations

 Telecom Regulatory Authority of India (TRAI) today issued Telecommunication (Broadcasting and Cable) Services (Eighth) (Addressable Systems) Tariff (Fourth Amendment) Order, 2024 (1 of 2024);  Telecommunication (Broadcasting and Cable) Services Interconnection (Addressable Systems) (Sixth Amendment) Regulations, 2024 (4 of 2024); the Telecommunication (Broadcasting and Cable) Services Standards of Quality of Service and Consumer Protection (Addressable Systems) (Fourth Amendment) Regulations, 2024 (3 of 2024) and also recommendations to Ministry of Information and Broadcasting (MIB) on ‘Listing of channels in Electronic Programme Guide and Upgrading DD Free Dish platform to an Addressable System’. These amendments, except for few clauses, shall come into force after 90 days from the date of its publication in the official gazette.

In consonance with the complete digitization of the cable TV sector, TRAI on 3rd March 2017 had notified the Regulatory Framework for Broadcasting and Cable services. The framework was further tuned to the need of the broadcasting ecosystem and to address the concerns of stakeholders through amendments issued in 2020 and 2022. 

The stakeholders namely, broadcasters, MSOs, DTH operators and LCOs had taken up further issues for the consideration of the Authority from time to time.

To address such issues, the Authority issued a consultation paper on “Review of Regulatory Framework for Broadcasting and Cable services” on 8th August 2023 for seeking stakeholders’ comments.

The consultation paper sought comments and suggestions from various stakeholders, on several issues which included Network Capacity Fee (NCF), discount limit on sum of MRP of a-la-carte channels for fixing MRP of bouquets by the distributors of TV channels (Distribution Platform Operators-DPOs), equivalence of an HD channel in terms of SD channels for capacity calculations, mandatory FTA News Channels in all packs formed by the DPOs, level playing field with DD Free Dish, amendment to Reference Interconnect Offer, listing of channels in Electronic Programme Guide (EPG), revenue share between MSO and LCO, carriage fee, removal of channels after expiry of existing interconnection agreement, issues related to billing cycle, regulation of platform service channels, review of prescribed charges, consumer corner, establishment of websites by DPOs, manual of practice, etc.

The Authority analysed the comments of the stakeholders and the discussion held during the open house discussion and noted the level of competition in the market due to the presence of multiple Broadcasters, DPOs (MSO/DTH/HITS/IPTV) and LCOs. Accordingly, there is a need to provide flexibility to the service providers for enabling them to adopt to the dynamic market conditions while at the same time safeguarding the interest of consumers and small players through transparency, accountability and equitability.

Based on the above considerations, TRAI has notified the amendments to Tariff Order 2017, Interconnection Regulations 2017 and QoS Regulation 2017. The primary objective of these amendments includes the following:

 

1. Facilitate growth of the broadcasting sector by reducing regulatory mandates and compliance requirements.
2. Provide flexibility to the service providers to adopt a market driven approach while safeguarding the interest of the consumers and small players through transparency, accountability and equitability.
3. Promoting ease of doing business by simplifying the regulatory provisions.

The salient features of these amendments include the following:

 A. Tariff Order

1. Ceilings of Rs 130 for 200 channels and Rs 160 on more than 200 channels have been removed on Network Capacity Fee (NCF) and is kept under forbearance to make it market driven as well as equitable. Service provider may now charge different NCF based on number of channels, different regions, different customer classes or any combination thereof. To ensure transparency, all such charges have to be mandatorily published by the service providers and communicated to the consumers besides reporting to the TRAI.
2. DPOs have now been permitted to offer discount up to 45% while forming their bouquets to enable flexibility for them in forming bouquets and to offer attractive deals to the consumers. Earlier this discount was permitted only up to 15%.
3. A pay channel available at no subscription fee on the DTH platform of the public service broadcaster has to be declared free-to-air by the broadcaster of the channel for all the addressable distribution platforms also so as to have a level-playing field.
4. DPOs have been mandated to declare tariff of their platform services.

 

   B. Interconnection Regulations

1. With the proliferation of HD television sets and to encourage transmission of high-definition content, distinction between HD and SD channels has been removed for the purpose of carriage fee.
2. Carriage fee regime simplified and made technology neutral by prescribing only single ceiling for carriage fee, thereby, providing the DPOs with the option to charge a lesser carriage fee as deemed appropriate.
3. The above measures are expected to not only simplify the offerings of the service providers to the consumers but also promote the availability of high-quality channels.

 

 C. QoS Regulations

1. Charges for services like installation and activation, visiting, relocation and temporary suspension which were prescribed earlier under regulation have now been kept under forbearance. DPOs have to publish the charges of their services for clarity and transparency to consumers.
2. Relaxation of certain regulatory compliances for small DPOs.
3. Duration/Term/Validity of all prepaid subscriptions to be specified in number of days only for greater clarity to the consumers.
4. DPOs may display Distributor Retail Price (DRP) in the electronic programme guide (EPG) along with MRP for channels.
5. DPOs to categorise platform service channels under the genre ‘Platform Services’ in the EPG.
6. DPOs to display respective MRP of the platform service channel in the EPG against each platform service to ensure transparency.
7. DPOs to provide an option of activation/deactivation of any platform service.

 

D. Financial disincentives have been introduced for contravention to provisions of the Tariff Order and certain other provisions of Interconnection Regulation and QoS Regulation to ensure accountability of service providers.

E.  Service providers to publish all the information related to tariff and other charges which have now been kept under forbearance, on their websites. Moreover, they need to communicate the tariff and other charges to the subscribers, pertaining to the plans being subscribed.

 

Further, the Authority also issued recommendations to MIB on certain issues covered in the consultation process. These issues include ‘Listing of channels in Electronic Programme Guide’ and transition of ‘DD Free Dish’ to an addressable system. The salient features of these recommendations are as follows:

    A.  Listing of channels in EPG:

While giving permission to each channel, MIB to seek information from broadcasters about primary language of each channel and sub-Genre of every non-news channel as per Interconnection Regulation 2017 and display the same on Broadcast Seva portal of MIB to enable DPOs to place the channel at appropriate place in the EPG for easy navigation by the consumers, in accordance with the present regulation.

  B.  Upgradation of DD Free Dish platform to an Addressable System:

1. In order to ensure quality of viewing experience, prevent unauthorized re-transmission of television channels to combat piracy and maintain the record of subscribers, Prasar Bharati to take steps to convert DD Free Dish platform from a non-addressable system to an addressable system and make a beginning by encrypting the signals of private satellite television channels at DD Free Dish headend before uplinking. Subsequently, all other channels of DD Free Dish may also be transmitted in encrypted form.
2. Public service broadcaster will be provided with the requisite exemptions of TRAI Regulations, once such notification is issued by MIB.
3. Prasar Bharati may utilize indigenous technologies for Conditional Access System (CAS), Subscriber Management System (SMS) and interoperable Set Top Boxes (STBs).
4. Prasar Bharati should adopt interoperable STBs for DD Free Dish to act as catalyst for transitioning the entire ecosystem from operator-based STBs to interoperable STBs to empower consumers’ choice. This will eliminate the need for changing STBs every time the service provider is changed.
5. A roadmap for transition of DD Free Dish from non-addressable to addressable platform along with authorizing manufacturers and distributors by Prasar Bharati for sales and aftersales service of STBs, has been suggested to MIB.
6. MIB may direct private DPOs to adopt and implement interoperable STBs.

 

TRAI in the present amendments, addressed those issues which were covered in the consultation paper dated 8th August 2023. However, during the consultation process for these amendments, certain other issues were also raised by various stakeholders which need to undergo a detailed consultation process for the consideration of TRAI.   These issues and suggestions have been noted and TRAI will come out with a comprehensive consultation paper shortly to address the relevant issues.

Form A2 : RBI form

 RBI notification dated 3rd July, 2024 follows:

Attention of Authorised Dealer (AD) Category-I banks and AD Category-II entities is invited to paragraph 4 of A.P. (DIR Series) Circular No. 50 dated February 11, 2016 (Compilation of R-Returns: Reporting under FETERS) and A.P. (DIR Series) Circular No. 02 dated April 12, 2023 (Authorised Dealers Category-II – Online Submission of Form A2), wherein AD Category-I banks and AD Category-II entities were permitted to allow submission of Form A2 through online mode by their customers, subject to certain conditions and limits.

2. On a review, and to improve ease of doing business, it is now decided to permit all Authorised Dealers (AD Category-I banks and AD Category-II entities) to facilitate remittances on the basis of online / physical submission of Form A2 and other related documents, if and as may be necessary, subject to the conditions laid down in Section 10(5) of FEMA 1999. Accordingly, there shall not be any limit on the amount being remitted on the basis of ‘online’ Form A2.

3. Authorised Dealers shall frame appropriate guidelines for the purpose, with the approval of their Board within the ambit of extant statutory and regulatory framework. The Authorised Dealers shall continue to comply with the relevant provisions of FEMA 1999 and ‘Master Direction – Know Your Customer (KYC) Direction, 2016’ as updated from time to time, issued by Department of Regulation, RBI, for all transactions. It may be further noted that reporting of transactions in FETERS shall continue, as hitherto, by the Authorised Dealer banks.

4. Authorised Dealers may bring the contents of this circular to the notice of their constituents.

non compliance with section 90

 ROC (Registrar of Companies), Kanpur has levied a penalty of Rs.654,000/- on the company and its directors for delay in filing form BEN-2 relating to significant beneficial ownership. 

The company Deer Smart India Private Limited a wholly owned subsidiary of a Hongkong company was required to file BEN-2 in respect of the significant beneficial owner in the company. However it failed to do so. 

The company received the BEN-1 from the SBO on 21/10/2019 itself but failed to file it until 23/2/2024, a delay of 1158 days. Therefore the ROC Kanpur levied a penalty as above. 

The details of the adjudication order can be found at the ROC site.