If a complainant withdraws the case under section 138 of the Negotiable Instruments Act, before the charges are framed, he could get a refund of up to 50% of the court fees paid
If you plan to withdraw a cheque-bounce case in court before charges are framed, you may also receive about 50% of the court fees as refund. This move would not only benefit individuals, but also financial institutions who file such cases, then opt for out-of-court settlement.
The Maharashtra government announced in a gazette notification in May that a claim for refund of court fees can be made after the withdrawal of the complaints for the cases, which are filed under section 138 of the Negotiable Instruments Act, 1881.
In India, the Negotiable Instruments Act regulates commercial transactions which take place through cheques, promissory notes and bills of exchange.
According to the Maharashtra government resolution (GR), the state government, in exercise of its powers conferred by section 43(2) of the Bombay Court Fees Act, 1959 will provide part of the court fees paid by the complainant under article 18 of schedule I, appended to the Act. Such refund will be paid to the complainant under two broad circumstances and conditions.
First, under section 138 of the Negotiable Instruments Act, 1881, a refund of 50% of the total court fees will be made when the complainant withdraws a complaint, or when the offence was compounded, before framing of particulars/charges, provided the claim is made within one year from the date of withdrawal of the complaint.
Similarly, 25% of the court fee will be refunded provided the complaint is withdrawn, or the offence is compounded, after farming of particulars/charges, or any subsequent stages of the complaint. Here again, a claim has to be made within a year.
Nifty to move between 5,500 and 5,690. A close above 5,690 would signal a fresh rally
Signs of steady growth in the global economy, following a robust rise in US manufacturing in June, helped the Asian markets open higher this morning. This positive effect rubbed on the Indian bourses, as well. However, the lack of any major triggers resulted in the market paring a major part of the day's gains and closing with modest gains.
The market opened strong, tracking good gains among its Asian peers, on signs of a steady global economic recovery. The Nifty was 53 points higher at the opening at 5,680 and the Sensex gained 133 points. Oil & gas, banking, auto and metal counters witnessed good buying activity in early trade.
Investors resorted to profit booking at higher levels resulting in the market falling to the day's low in mid-morning trade. At the intra-day low, the Nifty fell to 5,633 and the Sensex to 18,782. However, the support of the broader indices kept the market in the green. The market was range-bound till the end of the session in the absence of any major triggers. The Nifty gained 23 points to close at 5,651 and the Sensex closed trade at 18,814, up 52 points from its previous close.
The Nifty traded well above its support of 5,475 during the entire session today. A range-bound movement is expected till the Nifty touches 5,690. A close above 5,700 would signal a fresh rally.
The advance-decline ratio on the National Stock Exchange was a positive 949:451.
Among the broader markets, the BSE Mid-cap index advanced 0.92% and the BSE Small-cap index surged 1.19%.
The BSE Realty index (up 3.66%) was the top sectoral gainer today. It was followed by BSE Consumer Durables (up 1.99%), BSE Bankex (up 1.09%), BSE Auto (up 0.91%) and BSE PSU (up 0.84%). BSE Capital Goods (down 0.29%) and BSE Fast Moving Consumer Goods (down 0.21%) were the laggards today.
Reliance Infrastructure (up 6.84%), DLF (up 6.01%), Reliance Communications (up 3.29%), Hindalco Industries (up 1.90%) and Tata Motors (up 1.76%) were the top Sensex gainers. The losers were led by ITC (down 1.34%), Larsen & Toubro (down 0.88%), Tata Steel (down 0.86%), NTPC (down 0.81%) and Hero Honda (down 0.36%).
The top Nifty gainers were Reliance Infra (up 6.95%), DLF (up 5.76%), RCom (up 3.34%), PNB (up 3.21%) and Kotak Bank (up 3.08%). NTPC (down 1.50%), ITC (down 1.31%), TCS (down 0.78%), L&T (down 0.75%) and Cairn India (down 0.71%) were the major losers on the index.
Markets in Asia, with the exception of the KLSE Composite, finished higher in today's trade. The gains were mainly attributed to positive economic data from the US last week, which showed robust manufacturing growth in June.
The Shanghai Composite jumped 1.94%, the Hang Seng surged 1.66%, the Jakarta Composite gained 0.67%, the Nikkei 225 rose 0.98%, the Straits Times advanced 0.46%, the Seoul Composite climbed 0.92% and the Taiwan Weighted was 0.40% higher. On the other hand, the KLSE Composite lost 0.04% in trade.
Back home, foreign institutional investors were net buyers of stocks worth Rs599.66 crore on Friday. On the other hand, domestic institutional investors were net sellers of shares worth Rs455.31 crore.
Tea major McLeod Russel hopes to cash in on the decline in tea output from Africa, which has resulted in higher prices for Indian tea. Price of quality tea is expected to rise by around 10%-12% and other types of teas by 5% to 7%. The company also expects its production for the current year to be around 104 million kg compared to 96 million kg last year. McLeod Russel gained 2.39% to Rs278.55 on the National Stock Exchange today.
Coal India saw a setback in production last month on account of heavy rains. It was short of its target by around 2 million tonnes, but expects to achieve its production target of 452 million tonnes for the fiscal 2011-12. The stock rose 2.62% to Rs394.30 on the NSE today.
NHPC, the country's largest hydro power producer, plans to raise about Rs2,000 crore in the current fiscal, mostly from the domestic market. The proceeds would be utilised for existing as well as upcoming projects. NHPC, which has an installed capacity of more than 5,300MW, has a cash surplus of over Rs4,000 crore. NHPC was up 1.42% at Rs24.95 on the NSE.
MTNL has invited expressions of interest from banks for providing long-term loans of Rs1,500 crore to repay its debt and meet operational expenses. The funds are expected be used to repay the loan the state-owned telecom major had taken for buying 3G and BWA spectrum last year. MTNL plans to convert Rs3,000 crore loan, out of the loan worth Rs7,000 crore it had taken last year, into long-term debt. MTNL climbed 2.39% to Rs45 apiece on the NSE.
Accepting the royalty condition alone would mean about $900 million dent in revenues of Cairn India annually. Also, Cairn Energy will have to convince the Cairn India board into accepting the conditions or Vedanta when it takes over the company overrule the board
New Delhi: UK's Cairn Energy or its successor Vedanta Resources may have to bulldoze Cairn India board if they were to accept conditions set by the Indian government to clear their $9 billion deal, reports PTI.
The Cairn India's (CIL) board has on two occasions rejected the oil ministry conditions that royalties paid by ONGC on its all important north-western Indian state Rajasthan oilfields, be cost recoverable from oil sales saying this was against contractual provisions and not in the interest of the company and its shareholders.
Also, CIL is against the Rs2,500 per tonne cess being imposed on it saying contractually ONGC, like in case of royalty, is responsible for payment of the levy. Cost recovery of royalty and payment of cess are the preconditions Cabinet set last week for approving Cairn Energy selling sake in CIL to Vedanta.
But now if its parent (Cairn Energy) or Vedanta were to accept these conditions, a serious corporate governance issue will arise for CIL, analysts tracking the deal said.
"Can CIL compromise other shareholders' interest just because one shareholder (Cairn Energy) is selling its stake to the other (Vedanta)," one of them asked.
"I think there is a larger corporate governance issue involved. It is true that it is a corporate transaction involving share transfer between two entities. But can someone sell a majority stake in a company without taking that company into confidence," another person asked.
Accepting the royalty condition alone would mean about $900 million dent in revenues of Cairn India annually, they said, adding either Cairn Energy will have to convince CIL board into accepting the conditions or Vedanta when it takes over the company overrule the board.
Cairn Energy had publicly voiced concern over both the preconditions and Vedanta opposed them in a 28th January letter to the then oil secretary S Sundareshan.
Stating that acceptance of the conditions could be challenged by CIL's minority shareholders under provisions of the Companies Act, Vedanta CEO MS Mehta wrote Vedanta would become just a shareholder of CIL after completion of the deal.
"CIL and its subsidiaries are the signatories to and counterparties to the various Production Sharing Contracts (PSCs) entered into with the government of India. As Vedanta would not be a party to any of these contracts, and would be merely a shareholder of CIL, it would be neither possible nor appropriate for Vedanta to agree to any conditions which directly impacts their terms-particularly as these impacts the rights of minority shareholders," he wrote.
Emphasising that CIL was an independently-run listed entity with an independent board that was duty bound to act in the interests of all shareholders, he said the riders "would involve a significant departure from the terms of the existing contracts entered into by CIL and government."
"We also understand that these (conditions) would have a material adverse impact on CIL's value and thus negatively impact the interests of all shareholders, including the minority shareholders. Acceptance of any of these proposals is likely to be challenged by CIL's minority shareholders under the provisions of the Companies Act. As such, you will kindly appreciate that we are not in a position to accept these," Vedanta Resources CEO MS Mehta wrote in the two-page letter.
Analysts said if Vedanta accepts the government preconditions, then it will have to overrule the board of Cairn India and make it do a U-turn into accepting them.
While an e-mail sent to Vedanta remained unanswered, Cairn India spokesperson was unavailable for comments.
Cairn Energy has always maintained that it is just a shareholder in CIL and the expertise, skills and management vests in Cairn India. So can the UK firm or its successor impose conditions which are detrimental to Cairn India's interest, an analyst asked.
Another analyst said minority shareholders can take the board of directors of Cairn India to court for jeopardising their interest by compromising on their interest.
Of the four independent directors on Cairn India, two of them have conflict of interest (they are also on the board of Vedanta Resources). It is now the job of the independent directors to protect minority shareholders' interest.
The Cabinet Committee on Economic Affairs (CCEA) had last week decided to give approval to the $9-billion deal subject to Cairn/Vedanta allowing royalties from Cairn India's prize Rajasthan oil fields to be added to project costs and recovered from sales. Also, it has to end arbitration proceedings against the government disputing its liability to pay cess, or tax, on its 70% share of oil from the fields.
Third, the deal has to be approved by state Oil and Natural Gas Corporation (ONGC), which has a stake in all three of Cairn India's producing assets and five of its seven exploration assets, waiving its pre-emption rights. And finally, the acquisition needs security clearance.
Cairn Energy is selling 40% stake in Cairn India to Vedanta.
Sources said while Cairn India will not have to pay any royalty and state-owned ONGC will continue to pay royalty on its behalf to the state government but the levy will be added to project costs that are first deducted from oil sale revenues before profits are split between partners and the government.
Acceptance of this condition by Edinburgh-based Cairn Energy or its successor London-listed miner Vedanta will lower Cairn India's profit over the approved life of the life lasting 2020 from $7.43 billion to $5.75 billion.
Sources said the lower profits have been calculated at approved peak output of 175,000 barrels a day and considering a crude oil price of $70 per barrel.
Cairn also has to agree to ending arbitration proceedings against the government disputing its liability to pay cess, or tax, on its 70% share of oil from the Rajasthan fields. Cairn India currently pays Rs2,626.5 per tonne cess under protest but unlike royalty, treats it as a cost recoverable item.
The government's take from the RJ-ON-90/1 block will come down to $3.6 billion from $5.188 billion as a result of royalty being made cost recoverable, sources said.
Also, the deal has to be approved by ONGC, which has a stake in all three of Cairn India's producing assets and five of its seven exploration assets, waiving its pre-emption rights. And finally, the acquisition will need security clearance.
ONGC pays royalty on its 30% share of oil from Rajasthan fields as well as on operator Cairn India's 70% take. It will contractually continue to pay royalty on all the oil produced from Rajasthan but this will be added to project cost, which is first deducted from revenues earned from sale of oil before profits are split between partners.
Cairn last week cut the price it was demanding from Vedanta and removed a non-compete condition. Vedanta will now pay $6.02 billion for a 40% stake in Cairn India at a reduced price of Rs355 per share, down from the original $6.84 billion.
Last August, London-listed, India-focused miner Vedanta proposed to buy 51% to 60% of oil and gas explorer Cairn India for up to $9.6 billion in cash, but the deal has been delayed due to a lack of government and regulatory approvals.
Even before Vedanta made its move, ONGC had demanded that royalties be added to costs and recouped through sales, citing provisions in its contract. After the deal was announced, it maintained it had pre-emption rights and that the acquisition could not go ahead without its agreement.
The CCEA last week overruled objections to ONGC's demand by Cairn/Vedanta and held these will have to be met before the approval is granted.
Both Cairn and Vedanta disputed royalty being made cost recoverable as it would dent Cairn India profits. They also opposed the need for partner consent for the transaction.
Vedanta has steadily built a position in Cairn Energy this year by acquiring a 10.4% stake from Malaysia's Petroliam Nasional Berhad, or Petronas for $1.47 billion (Rs331 a share). It also bought 8.1% stake through Sesa Goa's open offer to shareholders, which closed on 30th April, for $1.2 billion. The open offer was made at Rs355 per share (original acquisition price of Rs405 minus Rs50 per share non-compete fee).