Money & Banking
RBI compliances getting tougher for NBFCs
Last week, the banking regulator introduced ‘branch info’ return compliance for NBFCs. This new directive would surely curb speculative transactions as well, which otherwise are hard to track down
 
There were times when non-banking financial companies (NBFCs) had their own set of privileges over banks. The compliances laid down by Reserve Bank of India (RBI) were far more lenient for NBFCs than those for banks. But gone are those golden days and now even the NBFCs are under RBI’s continuous screening. Having said this, the new compliances for NBFC came from the famous Sahara Case. 
 
A series of compliances for NBFCs post the Sahara Judgment, in August 2012 have been prescribed. Few of the important guidelines are Securitisation of Standard Assets and Guidelines for Private Placement of NBFCs. Apart from these the RBI, in the recent past, kept sending notices to companies, asking to send their annual reports, to examine whether the company is an NBFC or not. By this, we can applaud the efforts of RBI for preventing speculation in NBFCs.
 
Introduction of ‘Branch Info’ return
 
Last week the RBI vide its Notification RBI/2013-14/219 came up with an additional compliance requirement for the NBFCs to adhere. This requirement deals with the returns to be submitted by the NBFC with respect to their branch offices. 
As written earlier, the RBI had many regulatory compliances imposed on NBFCs. However, till date there was no such compliance for the branch offices set up by NBFCs. This will now enable RBI to keep a check on the happenings of the branch offices of NBFCs.
 
Requirements under this compliance are as below:
 
All deposit-taking NBFCs and all non-deposit taking NBFCs having total assets more than Rs50 crore are advised as under:
 
1. Submit within one month from the date of this circular, information in respect of all their branches functioning as on 30 June 2013;
 
2. Thereafter, update on a quarterly basis, the details of the branches opened/closed during the calendar quarter. Such updating will be done within 10 days of the calendar quarter to which the information relates.
 
Further, till now only the NBFCs-D were to file the details of their branches through Form NBS-1. With the introduction of Branch Information Returns, both the NBFCs-D and the NBFCs-ND, having asset size of Rs50 crore, will now, have to give the details of their Branches. Thus, the existing form NBS-1, required to be filed by the NBFC-D, has been done away with. All NBFCs with specified asset size have to submit the new form.
 
Having laid down a systematic procedure for evaluating the NBFCs and their Branch Offices, this new compliance might tighten the working of NBFCs. But it would surely curb the speculative transactions as well, which otherwise are hard for RBI to track down.
 
(The writer can be contacted at [email protected])
 

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Delhi gang-rape case: Court convicts four accused of rape and murder
The murder charge, for which the four men have been convicted, entails a maximum of death penalty and life term as the minimum punishment
 
The Delhi Court on Tuesday found the four men guilty of gang-raping and murdering a 23-year-old paramedical student in a moving bus in December last year. The 16th December Delhi gang rape case evoked nationwide outrage and led the government to bring in stringent anti-rape laws.
 
The court would hear arguments on the quantum of sentence on Wednesday.
 
Besides gangrape and murder, the Court held Mukesh (26), Vinay Sharma (20), Pawan Gupta (19) and Akshay Singh Thakur (28) guilty of attempt to murder, unnatural offences, dacoity, destruction of evidence, conspiracy, kidnapping or abducting in order to murder, while acquitting them of the charge of murder in dacoity.
 
“All the accused have been convicted for various offences including attempt to kill the complainant (victim’s male friend), for gangrape with the victim and also for unnatural sex with her and killing the victim. The accused have also tried to destroy the evidence after the incident, so they are convicted under section 201 of the IPC. They had abducted the victim to have illicit intercourse with her, so they are convicted under section 366 of the IPC,” the Judge said while pronouncing the judgement.
 
Additional Sessions Judge Yogesh Khanna, presiding the special fast track court, also convicted these four for kidnapping or abducting with intent to secretly and wrongfully confining a person, abducting to subject a person to grievous hurt and slavery, abducting woman to cause her defilement, voluntarily causing hurt in committing robbery and dishonestly receiving property stolen in the commission of a dacoity of the Indian Penal Code (IPC).
 
The murder charge, for which the four men have been convicted, entails a maximum of death penalty and life term as the minimum punishment.
 
Today’s decision comes ten days after the juvenile accomplice in the case was sentenced to three-year term at a detention centre after being held guilty by the Juvenile Justice Board of gang-rape and murder of the paramedic and robbing a carpenter before the incident.
 
On the night of 16th December 2012, Ram Singh, Vinay, Akshay, Pawan, Mukesh and the juvenile had gang-raped the girl in a bus after luring her and her 28-year-old male friend, who was also assaulted, on board the vehicle, which was later found to be plying illegally on Delhi roads.
 
The victim’s friend, a software engineer, had fractured his limbs in the incident. The girl succumbed to her injuries on 29 December 2012 at a hospital in Singapore.
 

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NMDC gets Rs1,631 crore tax notice from I-T department
The notice from Income Tax department alleges that NMDC had under invoiced some export accounts during assessment years 2006 to 2010
 
The Income Tax (I-T) Department has slapped a Rs1,631-crore demand notice on the state-run National Mineral Development Corporation (NMDC) Ltd.
 
The notice issued for assessment years 2006—07, 2007—08, 2008—09 and 2009—10, alleges that the state-run company had under-invoiced some export accounts. NMDC has paid Rs1,134.27 crore to the tax authorities so far and contested the claim in respective appellate authorities.
 
During 2011—12, I-T authorities reopened the assessment for financial years 2007—08 and 2008—09 including NMDC's incomes of Rs2,517.21 crore and Rs278.03 crore respectively, alleging 'under invoicing of exports' and raised tax demand notices for Rs1,255.83 crore and Rs102.85 crore for those years.
 
Similarly, last year I-T department reopened the state-run company’s accounts of assessment years 2006—07 and 2009—10 and raised tax demand notices for Rs177.90 crore and Rs94.36 crore for the respective years.
 
NMDC has contested these allegations stating that all transactions are transparent as well as routed through bank accounts and filed appeals before appellate authorities.
 
NMDC said it exported 3.26 million tonnes, 3.78 million tonnes, 3.87 million tonnes and 3.43 million tonnes during 2006-07, 2007-08, 2008-09 and 2009-10 respectively, and the total value of exports during those four years have been recorded as Rs4,382.52 crore.
 
Currently, the issue about assessment years 2006—07 and 2009—10 is pending before the Commissioner of Income Tax (Appeals) and the matter related to 2007—08 and 2008—09 is pending before the Income Tax Appellate Tribunal at Hyderabad.
 

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COMMENTS

Ramesh Poapt

4 years ago

Such malpractices is very usual for big companies.In PSUs,things are as per instructions from off the record 'big people'!This is the beauty(!)of all PSUs. PSUs are very important vehicle for the 'development/growth' of many well wishers(!)!

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