Companies & Sectors
HDFC Life in discussions to take over Max Life Insurance
In one of the biggest consolidations to happen in the Indian life insurance sector, Max Life Insurance and Max Financial Services have signed agreements to evaluate a potential merger with HDFC Standard Life Insurance Company Ltd.
 
A regulatory filing in the BSE by Housing Development Finance Corporation Ltd (HDFC) on Friday said the Board of Directors of HDFC Standard Life Insurance at a meeting on June 17, 2016, has approved entering into a confidentiality, exclusivity and standstill agreement to evaluate a proposal for a potential combination through a merger of Max Life Insurance Company Limited and Max Financial Services Limited with HDFC Life by way of a scheme of arrangement.
 
The proposed arrangements would be subject to due diligence, definitive documentation and applicable board, shareholder, regulatory, respective High Courts and other approvals.
 
HDFC Standard Life is a joint venture between HDFC with 61.63 per cent stake, Standard Life (Mauritius Holdings) 2006 Ltd with 35 per cent stake and the rest by others.
 
Earlier this month, HDFC had announced that its general insurance company HDFC ERGO General Insurance's board had approved the acquisition of L&T General Insurance Company for Rs 551 crore.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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Company law tribunal orders panel to oversee FTIL's asset sale

The National Company Law Tribunal (NCLT) has ordered the central government to set up a five-member committee to oversee the sale of investments of Financial Technologies (India) Ltd (FTIL).

The members of the panel would be a retired Supreme Court judge, two independent directors of FTIL, the managing director of FTIL and a nominee of the Ministry of Corporate Affairs.

According to the NCLT order, the managing director and the nominee of the Ministry of Corporate Affairs will have veto powers individually.

According to the order, the committee will consider sale of investments held by FTIL in compliance with orders passed by any regulatory or statutory authority in India or abroad as and when such sale is proposed by the company management.

The committee will also oversee the treasury operations of FTIL like investment of surplus funds or altering/switching of investments of surplus funds when proposed by the company management.

The committee will also oversee the funding of working capital requirements of FITL's subsidiaries when proposed by the company management.

According to NCLT order, the proceeds of sale of investments shall be deposited in a fixed deposit account to be used with the permission of the tribunal.

Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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Why is Maharashtra’s former minister rubbishing CID Report on mega lottery scam?
The Supreme Court, as recently as 2015, stated that, lottery is considered as a ‘pernicious vice’ and that lottery that has become epidemic in nature, ‘infests the whole community; it enters every dwelling; it reaches every class; it preys upon hard earnings of the poor; it plunders the ignorant and the simple.’ These were its words while upholding Kerala State’s ban on online lotteries.
 
While Kerala and several other states have banned online lotteries, Maharashtra, under the Congress-Nationalist Congress Party (NCP) government, violated Section 4 of the Central Government’s Lotteries (Regulation) Act, 1998, as per the 15-page report by Criminal Investigation Department (CID) on Maharashtra’s mega online lottery scam involving lottery agent, Santiago Martin, who operates, across the country, allegedly swindling state exchequers of thousands of crores of rupees.  
 
In fact, the CID report has slammed the position taken at that time by Jayant Patil, the then Finance Minister, that the Lottery Department, unlike similar departments in other States, does not have the powers to take action against illegal online lotteries. The CID report states that, when the state government is losing revenue due to illegal lotteries, it was expected that the Department concerned should have filed a police complaint and brought it to the notice of the state government, for appropriate action. It has also stated that the Home Ministry was the competent authority to take action against this crime. So, it can be seen, that, politicians in Maharashtra were busy trying to show they have either no power to control this mega loot or putting it on some on some other department and getting away.
 
While the then government portrayed helplessness about controlling illegal draws of online lotteries belonging to other states and banning them, the CID Report says that this too was within purview of the state Home Ministry, but it chose to look the other way. And also, it banning illegal online lotteries of other states is provided in the Act.
 
Violation of Section 4 of the Central Government’s Lotteries’ (Regulation) Act, means the then state government turned a Nelson’s eye to illegal draws running into multiples per day; playing on pre-announced single digit numbers, under the guise of different names of lotteries, when only one draw per week is authorised; conniving at illegal use of state government’s logo and authorized signatories by the agent to make the online tickets look authentic; and worse, letting the private agent to directly keep the money from lottery tickets as well as from unclaimed prizes, instead of it being collected by the state government for its treasury and then given to the agent and prize winners.  This resulted in the loss of thousands of crores of state government revenue, says the CID. So, is Jayant Patil, the then finance minister, now trying to pretend, nothing happened?
 
The CID reports explains that basically, for the authenticity of the ticket, the person who buys the lottery ticket must get the original ticket on which the state government’s lottery logo, stamp, acronym and signature of the concerned department official  is mandatory . However, lottery agents would give (and continue to do so), printouts of bogus tickets.  However, Martin, the kingpin, would have draws, 254 times a day, which means, one every 15 minutes, points out RTI activist Vijay Kumbhar.
 
Yet, the state government did not take action. 
 
Martin, states the CID Report, ran eight schemes and indulged in multiple draws, which is against the very principle of the Lotteries Act.
 
The CID further states, that, the Maharashtra government diluted the Central government rule of Section 19, from making this crime, cognizable and non-bailable to bailable and compounding. This too is truly shocking.
 
The CID report observes that:
 
  • Both the illegal private operators and government officials are in tacit understanding and are turning a blind eye to implement the government lottery act. Therefore, private lottery enterprises and private individuals are running illegal lottery dens, single digit internet/ online lottery schemes under the name of government lottery because of which the government  is incurring revenue losses on a large scale
     
  • Private operators and individuals are, on the one hand exploiting economically weaker section people through such illegal deals on a large scale and on the other hand, bringing heavy revenue losses to the government.  Apparently, the lottery operator is showing it to be a two-digit lottery; in fact, the results and prizes for the lottery are declared on a single digit, illegally.
     
  • Printing of tickets, which is mandatory, is not done as private lotteries are managed from different places simultaneously and mostly the tickets are delivered through computers. Bogus receipts with government logo/ stamp/ acronym are given as authentic tickets. This, is a violation of Section 4 of the 1998 Act.
     
  • Even though it is mentioned in the Central Government Act that, the earning from sale of lottery tickets should mandatorily be put in the state government treasury, so as to increase its revenue, in fact, all this money, is being deposited in the private management accounts and thereby it is possible that a great amount of government revenue can be lost
     
  • As per the Central government Act, although unclaimed prize money should go to the government treasury, despite this provision, in reality this amount is kept with the private management. This is criminal breach of trust by the private operators.  No more than one draw per week, every 15 minutes there used to be one draw. So, illegally these draws are made
     
  •  Although it is mandatory to have the place of  draws of state lottery within the State itself, the main server of such computers is kept out of the State and as such the basic principles of the central government Act are violated by the private lottery operators.  The server is outside the State and indicator is in the lottery outlet. This shows that there is no server existing in the state lottery as well.
     
  • Anand Kulkarni, former officer from the Indian Administrative Services (IAS), procured the report under RTI. Then last week, suddenly, the incumbent Bharatiya Janata Party (BJP)-Shiv Sena government in Maharashtra woke up and says it would consider an investigation by the Central Bureau of Investigation (CBI) and has asked the police to look into it. This is a real joke, as the CID Report of 2007 is scathing enough for the present government to immediately book Martin and all those involved in condoning his crime.
 
RTI activist Vijay Kumbhar, rubbishes the seriousness of the present BJP-Shiv Sena government. He says, “The Maharashtra Government lottery scam runs into three lakh crores of rupees, however Kingpin Martin being the darling of politicians, across party lines, this scam is likely to get killed. As per news reports, Martin’s son, Charles has joined BJP and his wife Leena, had shared the stage in Coimbatore, with the then prime ministerial candidate, Narendra Modi.”
 
While the Enforcement Directorate (ED) in April this year has attached Rs122 crore worth of immovable property of Martin, in Kochi, due to Rs4,500 crore loss to the Sikkim Government in a lottery scam involving him, the then Congress-NCP government sat tight, over the CID report submitted way back in 2007. This, despite the CID Report, which clearly states, that the scam runs into ‘thousands of crores of rupees’ and that the nexus between the then government and Martin is very evident.
 
Will Jayant Patil and other leaders of NCP and Congress continue to give false public statements about this CID report not having credibility and will the BJP leaders continue to pacify people by making statements of a CBI investigation? And in effect, protect the mega criminal, Martin. That is the moot question.
 
 

Section 4 rules of the Central government’s Lotteries (Regulation) Act, 1998:

 
4. Conditions subject to which lotteries may be organised etc.—A State Government may organise, conduct or promote a lottery, subject to the following conditions, namely:—
 
(a) prizes shall not be offered on any pre-announced number or on the basis of a single digit;
 
(b) the State Government shall print the lottery tickets bearing the imprint and logo of the State in such manner that the authenticity of the lottery ticket is ensured;
 
(c) the State Government shall sell the tickets either itself or through distributors or selling agents;
 
(d) the proceeds of the sale of lottery tickets shall be credited into the public account of the State;
 
(e) the State Government itself shall conduct the draws of all the lotteries;
 
(f) the prize money unclaimed within such time as may be prescribed by the State Government or not otherwise distributed, shall become the property of that Government;
 
(g) the place of draw shall be located within the State concerned;
 
(h) no lottery shall have more than one draw in a week;
 
(i) the draws of all kinds of lotteries shall be conducted between such period of the day as may be prescribed by the State Government;
 
(j) the number of bumper draws of a lottery shall not be more than six in a calendar year;
 
(k) such other conditions as may be prescribed by the Central Government.
 
 
(Vinita Deshmukh is consulting editor of Moneylife, an RTI activist and convener of the Pune Metro Jagruti Abhiyaan. She is the recipient of prestigious awards like the Statesman Award for Rural Reporting which she won twice in 1998 and 2005 and the Chameli Devi Jain award for outstanding media person for her investigation series on Dow Chemicals. She co-authored the book “To The Last Bullet – The Inspiring Story of A Braveheart - Ashok Kamte” with Vinita Kamte and is the author of “The Mighty Fall”.)

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