Archive for month: June, 2017
GST implications for sale of repossessed assets, by Nidhi Bothra
/0 Comments/in Indirect Taxes, NBFCs /by Vinod Kothari ConsultantsLending is always to good borrowers but often the good borrowers become bad borrowers. Thus, the business of lending brings with it the trouble of enforcement of security interests as well. The repossession of the collateral asset and eventual sale for recovery of the losses due to default are a common phenomenon in lending business. This article deals with the GST implications for sale of repossessed assets. Read more →
Impact of GST on factoring transactions
/0 Comments/in Indirect Taxes, SARFAESI, Securitisation /by Vinod Kothari ConsultantsBy Abhirup Ghosh, (gst@vinodkothari.com)
Factoring is a very popular product mode of working capital funding across the globe. In India, however, the picture is not quite rosy for factoring companies. Nevertheless, like every other thing in the country, factoring transactions will also be affected by the introduction of GST in India. Here in this article, we intend to walk you through the probable impact, GST would create on factoring transactions. Read more →
Small Companies to be now put on Fast Track Insolvency, by Barsha Dikshit
/0 Comments/in Insolvency and Bankruptcy /by Vinod Kothari ConsultantsInsolvency and Bankruptcy Board of India (‘IBBI’) vide notification number IBBI/2017-18/GN/REG 012 dated 14th June, 2017 [1]has come up with Fast track Insolvency regime for small companies by introducing the Insolvency and Bankruptcy Board of India (Fast Track Insolvency Resolution Process for Corporate Persons) Regulations, 2017 (‘Fast Track Regulation’) and has appointed 14th June, 2017 as the enforcement date. On the very same day Ministry Read more →
No pass through status to trusts if the beneficiaries are not identified on the date of institution of trust.
/0 Comments/in Direct Taxes, Securitisation /by Vinod Kothari ConsultantsBy Nidhi Bothra & Vijaylakshmi Agarwal, (finserv@vinodkothari.com)
Executive summary
This tax update summarises a recent ruling of Chennai Income Tax Appeallate Tribunal (“Chennai ITAT”) in the case of TVS Investments iFund Vs ITO[1] wherein the issue before Chennai ITAT was whether interest income of beneficiaries rolled over to another venture capital fund would be taxed in the hands of the iFund or in the hands of the new fund (TVS Shriram Growth Fund). While contemplating on the issue, the matter pertaining to determinacy of the trust/ fund and tests relating to the same to achieve pass-through status under the Income Tax Act was also briefly discussed. Read more →
GST on securitisation transactions.
/1 Comment/in Indirect Taxes, Securitisation /by Vinod Kothari ConsultantsBy Nidhi Bothra, (gst@vinodkothari.com)
Transitioning into GST, assessing its impact on business and taking appropriate measures to bring about tax neutrality/ efficiency are the prime concern for all and sundry. GST therefore also has an impact on the securitisation transactions in India which now happens to be Rs. 85,000 crores[1] odd industry. In this article we are broadly trying to deal with GST impact on securitisation of standard as well as non-performing assets and its various facets. Read more →
“Should we get an MFI license?”
/0 Comments/in NBFCs /by Vinod Kothari ConsultantsWe often get clients asking us the question, do we need an MFI licence or is it enough to get an NBFC Loan Company licence? After all, the client reasons, being an MFI is simply to be under a tigher regulatory and compliance regime. This article seeks to outline the key pros and cons of both. Read more →
MCA exemption notification paves way for limitless deposits from members, by Vinita Nair
/0 Comments/in Companies Act 2013 /by Vinod Kothari ConsultantsDeposits have always been strictly regulated by all the law makers, be it MCA, RBI or SEBI. Chapter V of Companies Act, 2013 (‘Act, 2013’) read with Companies (Acceptance of Deposits) Rules, 2014 [‘Deposit Rules’] provides the framework for lawful acceptance of deposits by companies. The framework provides list of amounts which do not fall within the meaning of deposits, compliances to be ensured for accepting deposits from members and compliances to be ensured for accepting public deposits by eligible companies. Read more →
Exemption notification for Section 8 Company
/0 Comments/in Companies Act 2013 /by Vinod Kothari ConsultantsMCA vide notification dated 5th June, 2015[1] (‘Principal Notification’) exempted Section 8 companies from complying with certain provisions of the Companies Act, 2013 (“Act, 2013”) subject to the condition that the company will ensure protection of shareholder’s interests. MCA vide notification dated June 13, 2017[2] (’Amendment Notification’) made certain amendments in the principal notification which has been analysed Read more →
NPA Clearance Mission on: Big ticket NPAs to face action under Banking Ordinance as committee recommends referral, by Vallari Dubey
/0 Comments/in NBFCs /by Vinod Kothari ConsultantsOn 13th June 2017, RBI released a press release titled, “RBI identifies Accounts for Reference by Banks under the Insolvency and Bankruptcy Code (IBC)”[1], specifying the recommendations issued by an Internal Advisory Committee (IAC), which constituted in furtherance of the powers laid down by the NPA Ordinance. Read more →