Legislative and Regulatory Update
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In This Issue
[No.69] November 30, 2003
International SEBI Department of Company Affairs CBDT CBEC Excise Tariff CBEC Customs Tariff CBEC Customs non Tariff Service Tax Department of Economic Affairs RBI DGFT Ministry of Chemicals and Fertilizers Department of Consumer Affairs Ministry of Labour Ministry of Road,Transport and Highways Press Information Bureau Supreme Court Gist of Cases of Various High Courts and Tribunals
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Free access to the most recent Supreme Court Judgments
Family Law: Mother was equitably estopped from litigating child's parentage.
A mother was equitably estopped from litigating the parentage of her child, even though DNA testing indicated that a man other than the putative father was the biological father of the child. The mother had repeatedly told the putative father that he was the child's father even though she knew that the other man might be the biological father. The mother dissuaded both the putative father and the biological father from pursuing genetic testing, and she continued this deception for more than four years after child was born, until custody litigation loomed on the horizon. The putative father had no reason to suspect he was not the biological father, and the biological father had no contact with child.
In re Shockley
Immigration: Court was required to consider exceptions to three-year residency rule for alien married to citizen spouse.
A district court could not apply a regulation's general rule that an alien and his citizen wife were to reside in the same home for three years prior to the alien petitioning for expedited naturalization, without considering the applicability of the exceptions provided in the regulation. Although there was language in the Eleventh Circuit's opinion in United States v. Maduno suggesting an actual residence requirement, Maduno did not hold that the actual residence requirement was absolute, or that the exceptions provided for in the regulation were invalid or otherwise inoperative.
U.S. v. Onabanjo
Legal Services: Contingent fee relating to stock sale was fair and reasonable.
A retainer fee agreement allowing an attorney to recover a contingent fee of 20 percent of the net sales proceeds for the client's stock in a corporation, with a $500,000 cap, if the attorney was instrumental in obtaining the sale was fair and reasonable when it was executed. An expert witness testified the contingent fee was less than the typical contingent fee of 25 to 50 percent and less than the most common contingent fee of one-third. The client had insisted on a contingent fee arrangement rather than an hourly fee, and collection of the contingent fee was uncertain because the client had the right to refuse to sell the stock. Finally, the fee agreement obligated the attorney to represent the client in "all matters" relating to the corporation.
Miller v. Kennedy & Minshew, Professional Corp.
Legal Services: Attorney's neglect of multiple probate matters warranted indefinite suspension.
An attorney's neglect in 14 separate probate matters, including his failure on numerous occasions to timely file Annual Accounts and Final Accounts in guardianship and conservatorship proceedings, warranted an indefinite suspension from the practice of law. The Supreme Court held that, while the attorney did not harm his clients financially, his neglect led to the waste of judicial resources. The attorney's failure to file the required accounts led the probate court to repeatedly issue citations to the attorney requiring him to personally appear and show cause for his failure to file the accounts. Moreover, attorney's misconduct was exacerbated by fact that he did not cooperate with the investigation into his misconduct, and the fact that the attorney was previously disciplined for mismanaging and mishandling an estate and failing to cooperate with disciplinary process.
In re Disciplinary Action against Cutting
Following the U.S Supreme Court ruling in State Farm Mutual Automobile Insurance Co. V. Campbell, California court of appeal issued a bombshell ruling altering long-established punitive damage process. The ruling reduces the largest punitive damage ever upheld by a California appellate court from $290 million to about $23.7 million. In State Farm Mutual Automobile Insurance Co. V. Campbell, U.S Supreme Court had narrowed the scope of punitive damages, saying they must bear some reasonable relationship to the individual injury at issue and the compensatory damages awarded. While interpreting Supreme Courts ruling, the Fresno court held that punitive damages can be awarded only in relation to the harm to the plaintiffs in a particular case -- not as a bludgeon to deter similar acts in the future. The court also said a defendant's general wealth can be taken into account only to determine the appropriate punishment for any particular malicious conduct, not for across-the-board problems.
U.S senate has approved the Anti- Spam bill but with slight modifications. The approval come on Tuesday, last weak in a voice vote. The legislation is aimed at reducing unwanted commercial e-mails and final vote will be taken in the house on December 8th before being sent to the White House for President Bush's signature. According to the White House, President Bush intends to sign it.
U.S Supreme Court will hear oral argument on Tuesday next weak in Joshua Davey's case. The case pits Washington state's tough ban on using public money for religious purposes against the federal Constitution's guarantee of freedom of religion. Davey had qualified for a Promise Scholarship, a state-funded program for high-achieving students of modest means but was denied to him when he decided to study for the ministry at Northwest College in Kirkland as the Washington Constitution bans the use of public money for religious instruction. A ruling in Davey's favor could overturn similar prohibitions in as many as 36 other states.
A Paris court on Friday acquitted three photographers, in Princess Diana's case stating that they had not violated any French Privacy laws. The three had taken photographs of Diana and her companion Dodi al Fayed in their car on the night of the 1997 crash. Three of them could have faced a year's jail term and a possible fine of 45,000 euros ($53,000), had they been found guilty.
French Prime Minister Jean-Pierre Raffarin announced in a meeting of his governing UMP party that he plans to introduce a bill aimed at protecting women. This bill could in effect ban Muslim women from wearing headscarves in public institutions.
Secondary Market Division
Reduction in Notice Period for Fixing the Book Closure/Record Date
Circular No. SEBI/CFD/DIL/SE/43/2003 Dated 20.11.2003 : SEBI has decided to reduce the notice period, by the listed companies to the stock exchanges about their book-closure / record date, in phases to ensure that there is minimum discomfort to the market players. therefore, it has been decided that in the first phase, the notice period may be reduced to 15 calendar days in case of demat scrips and to 21 calendar days in case of physical scrips in comparison of earlier period of 30 days and 42 days for demat scrips and physical scrips respectively.
Accordingly, all the stock exchanges have been advised to implement the decisions immediately and make necessary amendments to the bye-laws and listing agreement wherever necessary. The exchanges have also been directed to bring the provisions of this circular to the notice of the member brokers/clearing members of the exchange and also to put up the same on the website for easy access to the investors.
Disclosure Of Proprietary Trading By Broker To Client
Circular No. SEBI/MRD/SE/Cir- 42 /2003 Dated 19.11.2003 : With a view to increase the transparency in the dealings between the broker and the client, it has been decided that every broker shall disclose to his client whether he does client based business or proprietary trading as well. The broker is now required to disclose the aforesaid information to his existing clients within a period of one month from the date of this circular. Further, the broker has to disclose this information upfront to his new clients at the time of entering into the Know Your Client agreement.
The Stock Exchanges have been directed to make necessary amendments to the relevant bye-laws, rules and regulations for the implementation of the above decision immediately, as may be applicable.
Improvement In Corporate Governance
Circular No. IMD/PMS/CIR/1/21727/03 Dated 18.11.2003 : As it is already known, all portfolio managers are required to disclose the performance of their portfolios to their clients, including disclosure of the performance indicators calculated on the basis of weighted average method taking each individual category of investments for the immediately preceding three years in case of discretionary portfolio managers. In order to make the investors fully aware about how their funds have been deployed and also to give them an objective analysis of the performance of the portfolios being managed by the portfolio managers on discretionary basis in comparison with the rise or fall in the markets, it has been decided to disclose the performance of benchmark indices in the periodical reports to be furnished to the client in terms of Regulation 21 of SEBI (Portfolio Managers) Regulations, 1993. The portfolio managers may select any of the indices available, e.g. BSE (Sensitive) index, S&P CNX Nifty, BSE 100, BSE 200 or S&P CNX 500, depending on the investment objective and portfolio of the client. These benchmark indices may be decided by the portfolio managers and any change at a later date shall be recorded and justified with specific reasons thereof.
The Boards of portfolio managers may review the performance of the funds managed by them for each client separately in their meetings and should take corrective action wherever necessary. They may also compare the performance of the portfolios with benchmarks. Boards of the portfolio managers should review the compliance of regulations in their periodical meetings. There shall be internal audit by a practicing CA or CS so as to judge the quality of internal procedures being followed by the portfolio manager. The portfolio manager shall exercise due diligence in all their operational activities.
Foreign Institutional Investor
Issuance of Offshore Derivative Instruments by Registered Foreign Institutional Investors (FII)
Circular No. IMD/CUST/9/2003 Dated 20.11.2003 : It has been decided that those FIIs who do not have any outstanding off-shore derivatives shall submit a statement of 'Nil' report once in a quarter instead of a fortnightly basis provided that they submit the following undertaking to SEBI:
" We undertake that we shall submit reports of issuance / renewal / cancellation / redemption of offshore derivative/financial instruments against underlying Indian securities on a fortnightly basis as prescribed in Circular No. IMD/CUST/8/2003 dated August 08, 2003 as soon as we have issued/subscribed any such off-shore derivative instrument."
After submission of the undertaking , FIIs having nil outstanding off-shore derivatives need not submit 'Nil' report for the remaining fortnights during the current quarter and the first quarterly 'Nil' report shall be submitted commencing from the quarter ended December 2003 . The quarterly 'Nil' reports shall also contain the aforesaid undertaking.
It is clarified that all FIIs having outstanding off-shore derivatives or who issue / renew / cancel / redeem such off-shore derivatives shall continue to report on a fortnightly basis issuance / renewal / cancellation / redemption of the aforesaid instruments to SEBI as per the format prescribed in Circular No. IMD/CUST/8/2003 dated August 08, 2003 .
Appointment of Member for Central Listing Authority
Press Release No. PR 288/2003 Dated 27.11.2003 : , Shri.C B Bhave, Managing Director, National Securities Depository Ltd. (NSDL) has been appointed as member of CLA with effect from 6th November 2003 in place of Shri.Manjit Singh, who has resigned from Ludhiana Stock Exchange and by virtue of such resignation, also resigned from the membership of CLA on 6th September 2003. Shri.C B Bhave is appointed for a term of three years with effect from that date.
Secondary Market For Corporate Debt Securities
Press Release No. PR 286/2003 Dated 25.11.2003 : It has been decided that in respect of the unlisted securities which have already been issued and may be traded in the secondary market, a transition time is being given up to March 31, 2004 to enable the participants and issuers to conform to the guidelines related to Secondary Market For Corporate Debt Securities issued by SEBI. Consequently, during this transition period, the existing corporate debt securities could continue to be traded in the secondary market.
Strategic Action Plan For The Year 2003-04
Press Release No. PR 285/2003 Dated 25.11.2003 : SEBI had devised a Strategic Action Plan for the year 2003-04 in order to make the "Indian Securities market, a Benchmark for the Globe' The Strategic Action Plan has been drawn with four broad segments: a) Investors b) Market c) Intermediaries and d) Regulator in mind. During the period April 2003 to November 2003, a number of initiatives have been taken with a view to achieve the targets under the Plan. Some of the significant developments have been made related to viz. T+2 rolling settlement was introduced, Central Listing Authority (CLA) was constituted, Trading in Interest Rate Derivatives was launched and many more.
Launch Of Central Database Of Market Participants
Press Release No. PR 284/2003 Dated 25.11.2003 :Securities and Exchange Board of India has notified the SEBI [Central Database of Market Participants] Regulations 2003 for creation of a central database of market participants and Investors and grant of Unique Identification Numbers [MAPIN DATABASE]. The Database has been launched on November 25, 2003 by Shri G. N. Bajpai, Chairman, SEBI. Shri C. B. Bhave, Managing Director, NSDL gave the first unique identification number and identity card to Shri Bajpai on this occasion.
SEBI has the intention to achieve the following through these Regulations:
Develop an inventory of Market Participants and Investors;
Set up a standard for client code (Unique identification number);
Constituencies Notified for Purposes of Elections to the Council of ICWAI
Notification No. SO 1331(E) Dated 20.11.2003 : The Central Government has specified the four regional constituencies comprising of different states for the purposes of elections to the Council of the Institute of Cost and Works Accountants of India, namely:-
Western India Regional Constituency
Southern India Regional Constituency
Eastern India Regional Constituency
Northern India Regional Constituency
Constituencies Notified for Purposes of Elections to the Council of ICSI
Notification No. SO 1330(E) Dated 20.11.2003 : The Central Government has specified the four regional constituencies comprising of different states for the purposes of elections to the Council of the Institute of Company Secretaries of India , namely:-
Western India Regional Constituency
Southern India Regional Constituency
Eastern India Regional Constituency
Northern India Regional Constituency
Income-Tax (Twenty Eighth Amendment) Rules, 2003
Notification No. 299/2003 Dated 21.11.2003 : In the Income-tax Rules, 1962 in Part IX, for rules 42 and 43 has been substituted. Also, in Appendix II after Form No. 30, new forms "Form No. 30A, 30B and 30C" has been inserted.
Also, Form No. 31 and 33 have been substituted by the new Form No. 31 and 33 respectively. Apart from that Form No. 32 and Form No. 34 have been omitted.
Income-Tax (Twenty Seventh Amendment) Rules, 2003
Notification No. 298/2003 Dated 20.11.2003 : In the Income-tax Rules, 1962, after rule 6G, the following has been inserted, namely:
"CCC-A.- Report of audit in case of Income by way of royalties etc, in case of non-residents.
6GA. Form of report of audit to be furnished under sub-section (2) of section 44DA.
The report of audit of accounts of the non-resident (not being a company) or a foreign company, which is required to be furnished under sub-section (2) of section 44DA shall be in Form No. 3CE.II";
Also, in Appendix II, after Form No. 3CD, Form no. 3CE has been inserted.
Reconstitution of Committees for Recommending Write-off of Arrears
Instruction No 16/2003 Dated 18.11.2003 : Having regard to the modified structure of the committees for recommending write-off the Zonal Committees have been constituted and are notified. The Regional Committees will be constituted and notified by the respective cadre controlling CCsIT under intimation to the Board. Likewise, the Local Committees will be constituted and notified by the CCsIT concerned under intimation to the Board. The constitution of the committees for various charges will be fixed. In the event of a vacancy in any charge, another Chief Commissioner / Commissioner (s) / Addl CIT / JCIT, as the case may be, available in the same city or the nearest charge, may be requested to work on the committee. These arrangements will, however, be temporary till the vacancy is filled. The committees will meet at least once a month
Notifications u/s 10(23G), 35(1)(ii) and 35(1)(iii)
Notification No. 304/2003 Dated 21.11.2003 M/s Chennai Container Terminal Private Limited, Mumbai Approved u/s 10(23G)
Notification No. 303/2003 Dated 21.11.2003 M/s Mahakali Flyover Limited, Mumbai Approved u/s 10(23G)
Notification No. 302/2003 Dated 21.11.2003 Emas Expressway Pvt. Ltd, Kolkata Approved u/s 10(23G)
Notification No. 301/2003 Dated 21.11.2003 M/s Mapex Infrastructure Pvt Ltd, Kolkata Approved u/s 10(23G)
Notification No. 297/2003 Dated 19.11.2003 LPG Equipment Research Centre (LERC), Banglore Approved u/s 35(1)(ii)
Notification No. 296/2003 Date 19.11.2003 M/s GVK Industries Ltd, Hyderabad Approved u/s 10(23G)
Notification No. 295/2003 Dated 19.11.2003 M/s GVK Jaipur Kishangarh Expressway Pvt Ltd, Jaipur Approved u/s 10(23G)
Notification No. 294/2003 Dated 14.11.2003 M/s Centre for Materials for Electronics Technology, New Delhi Approved u/s 35(1)(ii)
Notification No. 293/2003 Dated 14.11.2003 M/s Vedanta Cultural Foundation, Mumbai Approved u/s 35(1)(iii)
Notification No. 291/2003 Dated 12.11.2003 M/s K K Birla Academy, New Delhi Approved u/s 35(1)(iii)
Notification No. 290/2003 Dated 11.11.2003 M/s Gujarat Institute of Desert Ecology (GUIDE), Gujarat Approved u/s 35(1)(iii)
Notification No. 289/2003 Dated 11.11.2003 M/s National Institute of Ocean Technology, Chennai Approved u/s 35(1)(iii)
Notification No. 288/2003 Dated 11.11.2003 M/s Medical Research Centre of Bombay Hospital Trust, Mumbai Approved u/s 35(1)(iii)
Notification No. 287/2003 Dated 11.11.2003 M/s International Board of Yoga, Mumbai Approved u/s 35(1)(iii)
Notification No. 286/2003 Dated 11.11.2003 M/s. the Mother's Service Society, Pondicherry Approved u/s 35(1)(iii)
Notification No. 285/2003 Dated 11.11.2003 M/s Gujarat Institute of Development Research, Ahmedabad Approved u/s 35(1)(iii)
Notification No. 284/2003 Dated 11.11.2003 M/s Vemagiri Power Generation Ltd, Mumbai Approved u/s 10(23G)
Notification No. 282/2003 Dated 11.11.2003 M/s HFCL Infotel Ltd, Chennai Approved u/s 10(23G)
Corrigendum To Notification No. 57/2001, Dated 14.03.2001
Notification No. 283/2003 Dated 11.11.2003 : In para 3 of the Notification, the name of the enterprise and the project has been corrected to read as -
"M/s Bengal Peerless Housing Development Company Ltd., Krishna Building, 224, AJC Bose Road, 2nd Floor, Calcutta - 700 017 for their project of Development of Anupama Building Complex Phase II on VIP Road Calcutta".
Inclusion of Amount of "Dharmada" In the Assessable Value of Goods
Circular No. 763/79/2003-CX Dated 21.11.2003 : Having regard to the inclusion of "Dharmada" collected from the buyers by the assessees in the assessable value or not the Hon'ble Supreme Court in Civil Appeal No. 7900-7902/95 in the case of CCE, Allahabad Vs. MIs. Panchmukhi Engg. Works & Ors and the Hon'ble Supreme Court vide its order dated 28/11/2002 allowed the appeals in favour of Revenue. The Revenue's stand in the said of case had been that "Dharmada" is includable in the assessable value. Ministry of Law had also advised that the division bench decision dated 28.11.2002 of the Hon'ble Supreme Court should be followed by the Department on this issue. It is therefore clarified that "Dharmada" collected by the assessee from the buyer is includable in the assessable value of the goods.
Instructions Regarding Import of Non-Standard Tapes
Circular No. 99/2003 Dated 27.11.2003 :In view of the legal position of the matter, it has been clarified that the import of measuring instruments other than standard units of metric system, is not permitted except under certain conditions specified in Section 23 of Standards of Weights and Measures Act, 1976. So, Field Formations of Customs have been instructed, to ensure that non-standard units of weight or measure ( including these with dual markings), except those permitted by proviso to section 23 of the Act ibid, are, on import, either confiscated absolutely or allowed re-export only.
DFCEC Scheme for Service Providers
Circular No. 98/2003 Dated 19.11.2003 : DGFT have confirmed that the objective of DFCEC Scheme for Service Providers is to permit import of aforesaid goods with a view to increase the capability of the service providers so as to enable him to render a better and efficient service. With this in mind import of professional equipments which are required in the profession of the service providers has been allowed. However, in so far as capital goods are concerned, its import to service provider has already been allowed through EPCG route. Therefore, in so far as DFCEC Scheme is concerned, under the category of professional equipments, import of only those equipments would be permissible under DFCEC Scheme, which are Professional Equipments required by the Service Provider for the purpose of rendering service and earning free foreign exchange. It is reiterated that import of capital goods which are other than professional equipment or office equipment shall not be allowed under DFCEC Scheme for Service Providers.
Corrigendum to Notification No. 54/2003-CUSTOMS, dated the 1st April, 2003
Corrigendum No. DRAWBACK/P.N. 03 /2003 Dated 18.11.2003 : In condition (3) of the Notification the words "capital goods" have been corrected to read as "professional equipments".
Rate of Exchange of Conversion of Foreign Currencies Specified for Exports w.e.f 01.12.2003
Notification No. 104/2003-N.T. Dated 24.11.2003 : The Board (CBEC) has determined the rate of exchange of conversion of each of the foreign currency specified into Indian currency or vice versa relating to export goods which has become effective from the 1st December, 2003.
Rate of Exchange of Conversion of Foreign Currencies Specified for Imports w.e.f 01.12.2003
Notification No. 103/2003-N.T. Dated 24.11.2003 : The Board (CBEC) has determined the rate of exchange of conversion of each of the foreign currency specified into Indian currency or vice versa relating to imported goods which has become effective from the 1st December, 2003.
Exemption to Taxable Services Specified in Section 65(105) of Finance Act, 1994
Notification No. 21/2003 Dated 20.11.2003 : The Central Government has exempted the taxable services specified in sub section (105) of section 65 of the Finance Act , 1994 provided to any person in respect of which payment is received in India in convertible foreign exchange, from the whole of the service tax leviable thereon. Provided that nothing contained in this notification shall apply when the payment received in India in convertible foreign exchange for taxable services rendered is repatriated from, or sent outside, India.
Order of Moratorium in Respect of South Gujarat Local Area Bank Ltd. Navsari
Notification No. SO1305(E) Dated 13.11.2003 : The Central Government, after considering the application made by the Reserve Bank of India has made an Order of Moratorium in respect of the South Gujarat Local Area Bank Ltd. Navsari, for the period from the close of business as on 13th November, 2003 upto and inclusive of 12th February, 2004 and has also stayed the commencement or continuance of all actions and proceedings against that banking company during the period of moratorium, subject to the condition that such stay shall not in any manner prejudice the exercise by the Central Government of its powers under clause (b) of Sub-section (4) of Section 35 of the Banking Regulation Act, 1949 or the exercise by the Reserve Bank of India of its powers under Section 38 of the Banking Regulation Act, 1949
The Central Government has also restricted the South Gujarat Local Area Bank Ltd. of doing or performing certain acts or transactions unless the written permission is obtained in that regard from Reserve Bank of India.
Section 23 of Banking Regulation Act, 1949 - Master Circular on Branch Licensing
Notification No. DBOD.No. BL.BC. 46/22.01.001/2003 Dated 18.11.2003 : Reserve Bank of India has been issuing instructions to commercial banks regarding opening/shifting/closing of branches/extension counters/offices, etc. from time to time and with a view to consolidate all the current instructions that are valid as on date, a master circular has been prepared to enable banks to peruse the required information at a single source. Foreign banks may be guided by paragraph 18 of the Master Circular. It has also been clarified that this master circular will supersede all earlier instructions relating to branch licensing.
Sanctioning of Loan to SPVs/ Public Sector Units, etc. on Strength of State Government Guarantees
Notification No. DBOD. BP.BC. 45/21.04.141/2003-04 Dated 17.11.2003 :Reserve Bank of India has reiterated that the banks/FIs should appraise credit proposals received from SPVs/ Public Sector units, Economically Weaker Sections housing and urban infrastructure etc. on commercial basis with respect to viability and in accordance with the credit policy laid down by the Board instead of relying solely on the strength of State Government guarantees. Banks have been advised to check the technical feasibility of projects to be financed
Draft Prudential Guidelines on Investment in Non- SLR Debt Securities by Urban Co-operative Banks
Notification No. BPD. PCB. Cir 25/16.20.00/2003-04 Dated 17.11.2003 : In order to contain the risks arising out of non-SLR investment portfolio of urban co-operative banks, a draft of guidelines has been issued by the Reserve Bank to all urban co-operative banks, which interalia, cover the following:
i) the need for strengthening the internal rating systems
ii) fixing of prudential limits
iii) review of the bank's non-SLR investments by the Board
iv) disclosures in 'Notes on Accounts' to the balance sheet
Foreign Exchange Management (Export of Goods and Services) (Second Amendment) Regulations, 2003
Notification No. GSR900(E) Dated 29.10.2003 : In the Foreign Exchange Management (Export of Goods and Services) Regulations, 2000 in Regulation 6, the sub-regulation 'D' has been substituted with the following, namely:
"D Duplicate Declaration Forms to be retained with Authorised Dealers
On the realisation of the export proceeds, the duplicate copies of export declaration forms viz. GR, PP and SOFTEX and Exchange Control copies of the shipping bills together with related Statutory Declaration Forms shall be retained by the Authorised Dealers."
Foreign Exchange Management (Transfer or issue of Security by a Person Resident outside India) (Fourth Amendment) Regulations, 2003
Notification No. GSR899(E) Dated 27.10.2003 : In the Foreign Exchange Management (Transfer or issue of Security by a Person Resident outside India) Regulations, 2000, in Schedule 5, paragraph 2, 3 and 5 have been amended by making certain insertions therein.
RBI Guidelines on Non-SLR Investments: Extension of Time for Compliance
Press Release No. 2003-2004/666 Dated 25.11.2003 : With the issue of guidelines for non-SLR investments by banks, the Market Participants has urged that they need time to develop appropriate procedures and adjust their portfolios to be in full conformity with the guidelines. It has, therefore, been decided to extend the time for compliance up to March 31, 2004. Consequently the guidelines will come into effect from April 1, 2004.
Standing Technical Advisory Committee on Financial Regulation
Press Release No. 2003-2004/649 Dated 20.11.2003 : The Reserve Bank of India has appointed a Standing Advisory Committee on Financial Regulation. the step was taken after taking into consideration the announcement made in the Mid-Term Review of Monetary and Credit Policy for 2003-04 where it was indicated that in order to strengthen the consultative process among banks, market participants and regulators of financial markets, a Standing Technical Committee on Financial Regulation on similar lines as the RBI Technical Advisory Committee on Money and Government Securities Market is being constituted to advise Reserve Bank on a continuing basis. It was also indicated that the Committee would examine the issues referred to it and advise Reserve Bank on regulations on an on-going basis covering banks and non-bank financial institutions and other market participants, in addition to the existing channels of consultations.
Amendments In The ITC (HS) Classifications Of Export And Import Items, 2002-2007
Notification No. 24(RE 2003)/2002-2007 Dated 25.11.2003 : The Central Government has made the amendments in the ITC (HS) Classifications of Export and Import Items, 2002-2007 published on 31st March, 2002 as amended from time to time. the amendment has been made in the entry having Exim Code 27101910 relating to Superior Kerosene Oil (SKO) for its import.
Also, an Import licensing Note has been added at the end of Chapter 27 of ITC (HS) Classification of Export and Import Items 2002- 07 published on 31st March, 2002 as amended from time to time-
" (2) Import of SKO shall be allowed through State Trading Enterprises (STEs) i.e. IOC, BPCL, HPCL and IBP for all purposes with STC being nominated as a State Trading Enterprise (STE) for supplies to Advance Licence holders. Advance Licence holders shall however, have the option to import SKO from the above mentioned STEs including STC."
Amendments In The ITC (HS) Classifications Of Export And Import Items, 2002-2007
Notification No. 23(RE 2003)/2002-2007 Dated 19.11.2003 : The Central Government has made the following amendments in the ITC (HS) Classifications of Export and Import Items, 2002-2007 published on 31st March, 2002 as amended from time to time, namely:-
Against item code number 2901 under heading "Organic Chemicals" in Table B of Schedule 2 of ITC (HS) , a new entry with item description "Anthranilic Acid" and the entries related to it has been added after 2901 (i ).
Ministry of Chemicals and Fertilizers
Fixation of Prices of Bulk Drugs Specified as the Maximum Sale Price
Order No. SO1317(E) Dated 17.11.2003 : The National Pharmaceutical Pricing Authority has fixed the prices related to Vitamin A Acetate (Dry Powder), Vitamin A Acetate (Oily liquid) and Vitamin A Palmitate (Oily liquid) as the maximum sale price (exclusive of excise duty and local taxes) at which these bulk drugs shall be sold.
Sugar Development Fund (Fourth Amendment) Rules, 2003
Notification No. GSR895(E) Dated 19.11.2003 : In rule 20 of the Sugar Development Fund Rules, 1983, after sub-rule(7), the following sub-rule has been inserted, namely:--
"(7A) For the purposes of reimbursement of expenditure incurred on internal transport and freight charges on export shipments of sugar, a sugar factory may be allowed to claim, and may be paid, the following :-
(i) An amount calculated at the rate of three hundred and fifty rupees per tonne, in respect of the quantity of sugar exported by it by sea from an Indian Port, on or after the 14th day of February 2003; and
(ii) Handling and marketing charges at the rate of five hundred rupees per tonne on the quantity of sugar exported by it on or after the 3rd day of October, 2003."
Also in Sugar Development Fund Rules, 1983, in Form VI, in item 8, after sub-item (d), the following sub-item has been inserted, namely:--
"(e) Whether the export consignment was transported by sea (Yes/No)."
Ministry of Labour
Pravasi Bharatiya Bima Yojana, 2003
Notification No. GSR889(E) Dated 13.11.2003 : , The Central Government has made the Scheme called the Pravasi Bharatiya Bima Yojana, 2003 which shall be effective from the 25th day of December, 2003. This Scheme shall be applicable to all citizens of India who will apply for and obtain an emigration clearance as required under the Emigration Act, 1983
Ministry of Road, Transport and Highways
National Highways Tribunal (Procedure) Rules, 2003
Notification No. GSR885(E) Dated 12.11.2003 : The Central Government has issued the the National Highways Tribunal (Procedure) Rules, 2003 to be effective from the date on which the National Highways (Land and Traffic) Act, 2002 comes into force.
Press Information Bureau
Appointment Of Additional Judge Of Gauhati High Court-Press Communique
Dated 27.11.2003 : The President has appointed Shri Biplab Kumar Sharma to be an Additional Judge of the Gauhati High Court, for a period of two years with effect from the date he assumes charge of his office.
Acceptance Of Return By Corporate Assesses And Assesses Falling Under Section 44AB Of IT Act, 1961
Dated 27.11.2003 : The Government has decided that the Return of income in case of all Corporate Assessees and the assesses falling under section 44 AB of the Income Tax Act, 1961 will be accepted by the respective income tax authorities on December 1, 2003. In States (Delhi, Rajasthan, Madhya Pradesh and Chattisgarh) where elections are scheduled for December 1, 2003, the returns of income for the above referred categories will be accepted by the respective income tax authorities on December 2, 2003. 29th and 30th November, 2003, being Saturday and Sunday respectively and therefore, closed working days, the date of acceptance of return of income for the above referred categories has been extended.
Parliament To Take Up More Than 20 Bills During Winter Session
Dated 27.11.2003 : The Winter Session of Parliament has been scheduled to commence on Tuesday, the 2nd of December 2003 and subject to exigencies of Government Business, the Session will conclude on Tuesday, the 23rd of December 2003. The Session will provide 16 sittings spread over a period of 22 days. A total of 54 items - 17 bills pending in Lok Sabha and Rajya Sabha, 30 New Bills, one financial item and 6 items of non-legislative Business, have already been finalized for being taken up during the Winter Session.
Notice To The Manufacturers/Importers Of Drugs
Dated 25.11.2003 : As per the provisions of para 4, 5, 14, 15 and 20 of DPCO, 1995, every manufacturer/importer of drugs and pharmaceutical products is required to submit information in the proforma I, II, V and VI provided under the order. In a press release National Pharmaceutical Pricing Authority (NPPA) has advised the concerned manufacturers/importers of drugs and pharmaceutical to ensure the submission of statutory returns to NPPA at the earliest
Working Group On Food Safety Constituted
Dated 20.11.2003 : A 24 Member Working Group on Food Safety has been constituted by the Ministry of Consumer Affairs, Food and Public Distribution with Director General of Bureau of Indian Standards (BIS) as its chairman on the recommendations of the meeting of the Central Consumers Protection Council (CCPC) held in July, 2003. The Working Group has to identify various issues relating to the safety and quality of food products available in the market including imported items and suggest preventive and remedial measures wherever needed. The Department has also constituted a Standing Committee for Promotion of Consumer Interests with a view to work out an effective strategy for promoting interest of the consumer with the involvement of various stake holders.
Appointment Of Shri Justice Maddy Narayana Reddy As Additional Judge -Press Communique
Dated 20.11.2003 : The President has appointed Shri Justice Maddy Narayana Reddy, Additional Judge of the Andhra Pradesh High Court, to be a Judge of the Andhra Pradesh High Court with effect from the date he assumes charge of his office.
Clarification By Finance Ministry
Dated 19.11.2003 : Responding to reports appearing in a section of the Press that the Government is planning to reduce cap on Foreign Institutional Investors (FIIs) and Non-Resident Indians (NRIs) holdings in private banks, from 49 percent to 26 percent, it has been clarified that at the current moment no such decision has been taken by the Government of India in this regard. Neither has any official communication been issued in the matter.
Goa Plast (P) Ltd. Vs. Chico Ursula D'souza
An appeal was filed before the Hon’ble Supreme Court seeking whether Section 138 of the Negotiable Instruments Act is applicable when cheque is dishonored by the bank due to stop payment instructions issued by the payer.
Hon’ble Supreme Court held that a person who issues a cheque could not stop payment by the bank on the ground that the payment was not due and the amounts were disputed. He would be covered by Section 138 of the Negotiable Instruments Act and would be liable to imprisonment and fine. The Apex Court was of the view that when a cheque is issued it is a sufficient evidence to prove that there was liability and according to the presumption under Section 139, this is admission of liability.
The apex court underlined that the relationship between the drawer and the drawee is not material when the liability is admitted and it is not necessary that there should be a mercantile or commercial relationship between the drawer and the drawee. Hence stopping the payment of a post-dated cheque, issued to discharge debt or liability, is a criminal offence under the Negotiable Instruments Act.
Sarva Shramik Sangh Vs. Indian Smelting And Refining Co. Ltd. And Ors.
An appeal was filed in the Hon’ble Supreme Court seeking a review of the judgments expressed by this Hon’ble Court in matters of General Labour Union v. Ahmedabad Mfg. And Calico Printing Co. Ltd; Vividh Kamgar Sabha v. Kalyani Steels Ltd.; CIPLA Ltd. v. Maharashtra General Kamgar Union wherein it was held that the employer-employee relation should be established first under the Industrial Disputes Act, only then, the question of unfair labour practices could be considered under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act.
It was contended by the trade unions that they could avail of the remedies either under the Maharashtra Act or the Industrial Disputes Act and the machinery under both the legislations were coextensive. Therefore, the issue about employment of contract labour could be raised under either of the laws. But the management argued that the basic question as to the relation between the employer and the employee was not within the purview of the Maharashtra Act.
The Apex Court while dismissing the appeal held that an industrial dispute has to be raised before the Tribunal under the Industrial Disputes Act to have the issue relating to actual nature of employment sort out. The court also rejected the trade unions’ request to overrule three of its earlier judgments holding against them in the matter of contract labour. The earlier judgments of the Supreme Court have asserted this principle and the present judgment reaffirmed it. - Appeal Dismissed.
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