Regulations
SEBI bars AM Fund Managers from collecting money from investors
Odisha-based AM Fund Managers was collecting money from investors through issue of preference shares
 
Market regulator Securities and Exchange Board of India (SEBI) asked AM Fund Managers Ltd not to mobilise funds from investors. SEBI also barred the company and its directors from issuing prospectus or any offer document or issue advertisement for soliciting money from investors for issue of securities.
 
The company was engaged in fund mobilising activity through issue of Preference Shares to more than 49 persons without complying with the provisions of the Companies Act, 1956, according to the SEBI Order.
 
SEBI had received complaints dated 3rd November and 10 November 2014 from investors alleging non-payment of their invested money by AM Fund Managers. The complainants also enclosed copies of application forms and preference share certificates.
 
SEBI started an investigation and wrote to AMF and Registrar of Companies (RoC), Cuttack, Odisha. RoC, Cuttack in its letter dated 31 December  2014 stated that the company has filed Form-2 with their office for issue of 36% Redeemable Preference Shares (RPS). The RoC also provided copies of Form-2 and list of allottees filed by the company with their office.
 
For ascertaining whether the Offer of RPS is in the nature of a public issue in accordance with Section 67 of the Companies Act, 1956, the number of subscribers is of utmost importance.  SEBI after investigation found it to be a public issue without following appropriate procedures for safeguarding the interests of investors.
 
Once it is found to be a public issue, it follows that such securities shall also have to be listed on a recognized stock exchange, as mandated under Section 73 of the Companies Act, 1956. In this regard, reference is made to Sections 73 of the Companies Act, 1956, of which sub-Sections (1), (2) and (3) are relevant for the instant case. No listing was made by the company.
 
The SEBI Order hence inferred that it prima facie appears that AMF had violated the provisions of Section 73 of the Companies Act, 1956, in respect of the Offer of RPS.
 
Since no prospectus was issued for the public issue, the SEBI Order inferred that prima facie, AMF had not complied with the provisions of Section 60 of Companies Act, 1956.
 
The SEBI member hence made it clear in his Order, “I am of the view that AMF is prima facie engaged in fund mobilising activity from the public, through the offer of RPS and as a result of the aforesaid activity has violated the aforementioned provisions of the Companies Act, 1956 (Section 56, Section 60 read with Section 2(36), Section 73).”
 
Hence the SEBI Order goes on to direct the company and its directors as follows:
(a) AMF shall not mobilize any fresh funds from investors through the offer of RPS or through the issuance of equity shares or any other securities, to the public and/or invite subscription, in any manner whatsoever, either directly or indirectly till further directions;
 
AMF, its Directors and Promoters are restrained from accessing the securities market and further prohibited from buying, selling or otherwise dealing in the securities market, either directly or indirectly, till further directions;
 
(b) AMF shall provide a full inventory of all its assets and properties;
 
(c) AMF 's Directors and Promoters shall provide a full inventory of all their assets and properties;
 
(d) AMF and its promoters shall not dispose of any of the properties or alienate or encumber any of the assets owned/acquired by that company through the offer of RPS, without prior permission from SEBI;
 
(e) AMF, its Directors and Promoters shall not divert any funds raised from public at large through the offer of RPS, which are kept in bank account(s) and/or in the custody of AMF;

User

Nifty, Sensex, Bank Nifty headed higher – Weekly closing report
Nifty will weaken only on a close below 8,820
 
The S&P BSE Sensex closed the week that ended on 28th February at 29,362 (up 130 points or 0.45%), while the NSE’s CNX Nifty closed at 8,902 (up 68 points or 0.77%). In the previous week, we had mentioned that Nifty may be headed lower, if it closes below 8,750, while Bank Nifty was already in a downtrend.
 
On Monday, Nifty slipped lower in the noon session and closed at 8,755 (down 79 points or 0.89%) after hitting a five-day low. There were uncertainties about Bills being passed in the Budget session. The Prime Minister reached out to the opposition, saying the Government will listen to their views, and efforts will be made to discuss all issues of national importance.
Rating agency Standard & Poor's warned that India's weak fiscal and debt indicators, coupled with the low-income levels, "constrain" the sovereign rating.
 
On Tuesday, Nifty witnessed a highly volatile session but managed to close marginally higher. Nifty closed at 8,762 (up 7 points or 0.08%). We anticipated the market to continue witnessing a weak move. The union government said that it was hopeful that the much-delayed Goods and Services Tax (GST) bill will be passed during the ongoing budget session. The Finance Commission has suggested raising share of states in central taxes to 42% from current 32%.
 
Gold prices dipped below the Rs27,000-mark by losing another Rs100 to trade at a 10-week low of Rs26,970 per 10 gram.
 
Weakness on the Nifty continued on Wednesday. Although it opened higher in the noon session it gave up all the intra-day gain and closed marginally higher. Nifty closed at 8,767 (up 5 points or 0.06%).  
 
Rating agency Moody's Investors Service said its assessment of India's credit ratings will be determined mainly by the extent of the country's fiscal reforms, and not on recent revisions to its economic growth data. Moody's rates India at "Baa3", the lowest investment grade rating, with a "stable" outlook.
 
Much awaited railway budget did not boost up the market sentiment and Nifty moved lower. After hitting nine-day low on Thursday Nifty closed at 8,684 (down 83 points or 0.95%). Railway Minister Suresh Prabhu said the railways will invest Rs8.5 lakh crore over the next five years. Ratings agency S&P raised its India GDP growth forecast to 7.9% from 6.2% for the year ending March 2016.
 
On Friday, Nifty moved higher throughout the session and closed near the day’s high. Nifty closed at 8,845 (up 161 points or 1.85%) in anticipation of a good budget.
 
In the Economic Survey 2014-15, Finance Minister Arun Jaitley stated that the government remains committed to fiscal consolidation and that the deficit target of 4.1% as envisaged in the Budget 2014-15 will be met.
 
The much awaited Budget for 2015-16 was welcomed with a positive opening on the Nifty. During the speech, it witnessed a highly volatile session with the benchmark giving up all the gains made at the beginning of the session. Post the budget speech, the market traded in negative but started rallying around 2 and finally closed higher. Nifty closed at 8,902 (up 57 points or 0.65%).
 
The government announced that corporate tax rate will be reduced from the current 30% to 25% over the next four years, will be defer the roll out of General Anti Avoidance Rule by two years until 1 April 2017 and increased the excise duty on cigarettes. It also proposed to merge Forward Markets Commission with Sebi, increase in service tax rate to 14% from 12% plus Education Cess. GST is to be put in place by 1 April 2016. It has abolished wealth tax and replaced it with an additional surcharge of 2% on the super-rich, with a taxable income of over Rs1 crore annually.
 
Of the 1,449 companies on the NSE, 516 companies closed in the green, 902 companies closed in the red while 31 companies closed flat.
 
Out of the 27 main sectors tracked by Moneylife, top five and the bottom five sectors for this week were:
 

User

Budget 2015: How it will affect your personal finances

The Budget includes certain provisions through which the common man can save more. Individuals can now avail of tax rebates of over Rs60,000 in FY2015-16

 

Individual can now avail of tax rebates of over Rs60,000 (total increase in limit for health insurance and pension scheme contributions) in FY2015-16 as compared to FY2014-15. Additional avenues are made available through which individuals can save tax. Deduction limit for health insurance premiums raised by Rs10,000 to Rs25,000.
 
Contributions to insurance pension schemes were earlier limited to Rs1 lakh for tax rebates. Savers can now get a rebate for contributions up to Rs1.50 lakh. Individuals can contribute up to 10% of their salary to the National Pension System. There will be no overall limit. In addition to the salary contributions, individuals can invest an additional Rs50,000. Sukanya Samriddhi Account Scheme is now eligible for tax rebate under Section 80C.
 
Below are the highlights of how the budget will affect your personal finances.
 
No change in rate of personal income tax
 
 
Rs10,000 increase in the limit of deduction under section 80D relating to health insurance
-Limit of deduction of health insurance premium increased from Rs15,000 to Rs25,000, for senior citizens limit increased from Rs20,000 to Rs30,000.
-The aggregate deduction for health insurance premium and medical expenditure incurred in respect of parents would be limited to thirty thousand rupees
-Senior citizens above the age of 80 years, who are not covered by health insurance, to be allowed deduction of Rs30000 towards medical expenditures.
 
Rs50,000 increase in the limit of deduction under 80CCC relating to pension plans
 
For any annuity plan of LIC or any other insurer for receiving pension from a fund set up under a pension scheme, the deductions have been raised to Rs1.50 lakh from Rs1 lakh
 
Rs50,000 additional deduction under 80CCD relating to National Pension System
 
Contributions not exceeding 10% of salary to NPS will be eligible for tax deduction. The overall limit of Rs1 lakh has been omitted. Apart from the salary contributions, additional contribution of up to Rs50,000 will be eligible for deductions.
 
Tax benefits under section 80C for the girl child under the Sukanya Samriddhi Account Scheme
 
-The investments made in the Scheme will be eligible for deduction under section 80C of the Act.
-The interest accruing on deposits in such account will be exempt from income tax. 
-The withdrawal from the said scheme in accordance with the rules of the said scheme will be exempt from tax
 
Scheme details-
-Rate of interest 9.1% Per Annum
-Minimum Investment Rs1000/-and Maximum Rs1,50,000 in a financial year
-Account can be opened up to age of 10 years only from the date of birth
-Partial withdrawal, maximum up to 50% of balance after attaining age of 18 years. Account can be closed after completion of 21 years.
 
 
Increase in the limit of deduction under section 80DDB relating to treatment of chronic diseases
 
Deduction limit increased to Rs80,000 from Rs60,000 with respect to the medical treatment of certain chronic and protracted diseases such as Cancer, full blown AIDS etc., in case of senior citizen.
 
Increase in the limit of deduction under section 80DD and 80U for persons with disability and severe disability
 
Additional deduction of Rs25,000 allowed for medical treatment differently abled dependant.
 
Deduction on donations made 
 
Donation made to National Fund for Control of Drug Abuse (NFCDA) to be eligible for 100% deduction u/s 80G of Income-tax Act. 100% deduction for contributions, other than by way of CSR contribution, to Swachh Bharat Kosh and Clean Ganga Fund.
 
Other Budget Provisions
 
Transport allowance exemption increased to Rs1,600 per month
 
Tax-free infrastructure bonds for the projects in the rail, road and irrigation sectors
 
Atal Pension Yojana to provide a defined pension, depending on the contribution and the period of contribution. Government to contribute 50% of the beneficiaries’ premium limited to Rs1,000 each year, for five years, in the new accounts opened before 31 December 2015.
 
Pradhan Mantri Jeevan Jyoti Bima Yojana to cover both natural and accidental death risk of Rs2 lakh at premium of Rs330 per year for the age group of 18-50.
 
Employees to opt for EPF or New Pension Scheme. For employee’s below a certain threshold of monthly income, contribution to EPF to be option, without affecting employees’ contribution.
 
Gold monetisation scheme to allow the depositors of gold to earn interest in their metal accounts and the jewellers to obtain loans in their metal account to be introduced.
 
Sovereign Gold Bond, as an alternative to purchasing metal gold scheme to be developed.
 
Service-tax plus education cesses increased from 12.36% to 14% to facilitate transition to GST.
 

 

User

COMMENTS

Suketu Shah

2 years ago

See how the sensex has gone up after announcement of 2015 Budget by Mr Arun Jaitly as compared to sensex movement after budget was announced by Chidambaraman for last 10 yrs.That speaks for itself whether budget was good or bad esp as compared to Chidambaram's.

Market reaction says it all.Ache din ki shurvat hain.

manoharlalsharma

2 years ago

we all r very LUCKY because Government do not have control over NATURE other wise they would TAXED and our life MISERABLE,so thank to almighty GOD./Hare Krus'na

Mahesh S Bhatt

2 years ago

Humne Economist ko Desh diya usne vat laga dali.

Hum ab chaiwale se acche din ki umeed rakte hai.

Hum Aam Aadmi kitne bafkuf the aur hain.

Ram Ram Arun Narendra achha mamu banaya

Itne paap ke baad Ganga aur maali ho gayi.

Mahesh

Ramanath nakhate

2 years ago



FM and the BJP government have betrayed the high expectations of common man, aam aadmi. They expected that the FM will be pro people in his maiden full year Budget : 2015-16. He could have raised the existing ceilings on the following by Rs.50000/- : the thresh-hold limit of income upto which there is no tax ; investments under Sec.80(c) ; tax rebate on interest on home loan. He could have reduced the lock-in period of the Tax savings Bank FDs from 5 to 3 years on par with the investments in tax- free MFs. He could have also made the interest earned on bank term deposits free of tax. There is still time and scope for FM to grant all these benefits and bring cheers on the face of middle and lower middle class and senior citizens who voted the BJP to power and have been waiting for Ache Din for last ten months. All the corporate world have been immensely rewarded by 5% cut in the corporate tax, cut in custom duties, and by removal of wealth tax at a minimal 2% surtax. FM should know that the underdogs do matter much when they are expected to play their role/ exercise their votes, may be it in the short or long term.
R.G.Nakhate

Jayalal Gopi

2 years ago

The clarity is lacking on this

VGANESAN

2 years ago

Gaar postponed and wealth tax abolished Corporate tax cut from 30 to 25 percent.Service tax raised from 12 to 14 percent. Cost of insurance premium and telecom nill etc will rise. One more thing is mutual fund agents exemption from service tax removed. Because of this my personal income will reduce 14percent from 1 st april and my expenditure will shoots up. Is this accha din budget. The present government is favouring foreign investors. Not indian common man.

REPLY

renu girish

In Reply to VGANESAN 2 years ago

do u want to say that mf distributers will be charged now 14% surcharged from their brokerage? unbelievable.

Gopalakrishnan Krishnan

2 years ago

The budget is politically oriented with economic development as a a by product.It is pro rich pro corporate pro poor and has some good intentions to track black money, find resources through conversion of gold resources into productive assets.Has identified areas for for investments employment and has provided support for infrastructure growth. But there are nothing to boost savings vitally needed to support investment and capital formation as such and middle class particularly salaried have been completely ignored as the Government no more requires their support till the next election. Political interest has been very well taken care of by pleasing NON NDA government ruled state This budget has lot of political mileage and the intentions to clip RBI's wings are also very obvious. inflation the worst enemy of the masses will rise its ugly head because of enhanced service tax.Middle class and RBI are the major losers in this budget.RBI over a period will get reduced to nothing.

We are listening!

Solve the equation and enter in the Captcha field.
  Loading...
Close

To continue


Please
Sign Up or Sign In
with

Email
Close

To continue


Please
Sign Up or Sign In
with

Email

BUY NOW

The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)