• RESERVE BANK OF INDIA

Circular No.48 Dated 26.04.2010 Rupee value of special currency basket Revised, effective from April 09, 2010

AD Category-I banks has been advised that a further revision has taken place on April 6, 2010 and accordingly, the Rupee value of the special currency basket has been fixed at Rs.60.897378 with effect from April 09, 2010.

Circular No. CIR/DNPD/ 1 /2010 Dated 27.04.2010 Permission to Stock Exchanges to introduce derivative contracts on Volatility Index

SEBI has decided to permit Stock Exchanges to introduce derivative contracts on Volatility Index, subject to the condition that the underlying Volatility Index has a track record of at least one year and Exchange has in place the appropriate risk management framework for such derivative contracts. However, before introduction of such contracts, the Stock Exchanges is required to submit certain details provided therein.

Circular No. CIR/MRD/DP/14/2010 Dated 26.04.2010 Guidelines for market makers on Small and Medium Enterprise (SME) exchange

In order to operationalise the framework put in place for setting up of new exchange or separate platform of existing stock exchange having nationwide terminals for 'Exchange/ SME Exchange', necessary changes have been made to applicable Regulations, circulars etc. As per the framework, market making has been made mandatory in respect of all scips listed and traded on SME exchange. In addition to it Guidelines for market makers on Small and Medium Enterprise (SME) exchange has also been made, which are applicable to applicable to all the registered Market makers for making market in all scripts listed and traded on SME exchange.

Circular No. CIR/MRD/DP/15/2010 Dated 28.04.2010 Cross-margining of Government Securities between cash and derivative segments of market

Stock Exchanges has been advised to make necessary amendments to the relevant bye-laws, rules and regulations for the implementation of the RBI's decision permitting FIIs to offer domestic Government Securities and foreign sovereign securities with AAA rating, as collateral to the recognized Stock Exchanges in India, in addition to cash, for their transactions in the cash segment of the market. However, cross-margining of Government Securities has not been allowed by the RBI between the cash and the derivative segments of the market.

Notification No.DNBS/ PD (SC/RC) No. 17/26.03.001/2009-10 Dated 21.04.2010 - Change in or Take Over of the Management of the business of the borrower by Securitisation Companies and Reconstruction Companies (Reserve Bank) Guidelines, 2010

In line with the announcement made in the Monetary Policy Statement, the Reserve Bank of India has notified guidelines titled as "Change in or Take Over of the Management of the business of the borrower by Securitisation Companies and Reconstruction Companies (Reserve Bank) Guidelines, 2010", framed under Section 9(a) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) to provide for the proper management of the business of the borrower to enable the Securitisation Company or Reconstruction Company (SC/RC) to realise their dues from the borrowers, by effecting change in or take over of the management of the business of the borrower and related matters.

Notification No. DNBS(PD-SC/RC) No. 7 /CGM (ASR)/-2010 Dated 21.04.2010 - Amendment to Securitisation Companies and Reconstruction Companies (Reserve Bank) Guidelines and Directions, 2003

In order to regulate the financial system to the advantage of the country and to prevent the affairs of Securitisation Company or Reconstruction Company from being conducted in a manner detrimental to the interest of investors or in any manner prejudicial to the interest of such Securitisation Company or Reconstruction Company, Reserve Bank has amended the provisions of Securitisation Companies and Reconstruction Companies (Reserve Bank) Guidelines and Directions, 2003 relating to Change or take Over of Management and Sale or Lease of a part or whole of the business of the borrower.

Accordingly, no Securitisation Company or Reconstruction Company are authourised to take the measures specified in Section 9(b) of the Act, until the Bank issues necessary guidelines in this behalf and measures specified in Sections 9(a) of the Act should be in accordance with instructions contained in Circular DNBS/PD (SC/RC) No. 17 /26.03.001/2009-10 dated April 21, 2010 as amended from time to time.

Circular No.DBOD.No.BL.BC. 99/22.01.009/2009-2010 Dated 26.04.2010 Relaxation in engaging any individual as Business Correspondents

With the purpose of providing more flexibility to banks, RBI has been decided to permit banks to engage any individual, including those operating Common Service Centres (CSCs) as Business Correspondents, subject to banks' comfort level and their carrying out suitable due diligence as also instituting additional safeguards as may be considered appropriate to minimise the agency risks.

Circular No.RPCD.CO.RF.BC.No. 71/07.37.02/2009-10 Dated 19.04.2010 - Extension of relief to "other farmers" under Agricultural Debt Waiver and Debt Relief Scheme, 2008

In view of the recent drought in some States and the severe floods in some other parts of the country, the Government of India has now to extend the last date of payment of 75% of overdue portion by the 'other farmer' under Debt Relief Scheme for another six months, that is up to June 30, 2010. The eligible "other farmers" may be allowed to repay this amount in one or more installments up to June 30, 2010.In case the payments are delayed by the farmers beyond June 30, 2010, the outstanding amount in the relevant accounts of such farmers shall be treated as NPA.

• INDIRECT TAXATION

Notification No. 53/2010 Dated 19.04.2010 Imposition of anti-dumping duty on Phenol exported from Thailand and Japan, effective upto October 18, 2010

Central Government, on the basis of the recommendation made by the designated authority, has decided to impose provisional anti-dumping duty on the imports of Phenol, originating in, or exported from Thailand and Japan. The anti-dumping duty imposed vide this notification shall be effective upto and inclusive of the 18th day of October, 2010

Notification No. 52/2010 Dated 19.04.2010 Imposition of anti-dumping duty on 1,1,1,2- Tetrafluoro ethane or R-134a exported from China and Japan, effective upto October 18, 2010

It has been concluded by the designated authority that the domestic industry had suffered material injury due to import of 1, 1, 1, 2-Tetrafluoroethane or R-134a of all types from exported from, People's Republic of China and Japan below its normal value. Accordingly, Central Government has decided to impose anti-dumping duty on 1,1,1,2- Tetrafluoro ethane or R-134a exported from China and Japan which will be effective upto and inclusive of the 18th day of October, 2010.

Circular No. 10/2010 Dated 26.04.2010 - Circular on fixation of Brand Rate of Duty Drawback

It has been directed that the Board is no longer handling cases relating to fixation of Brand rates of Duty Drawback in line with the Board's Circular No. 14/2003-Cus dated 6.3.03 whereby the work related to fixation of Brand rates of Duty Drawback was decentralized and Ministry would continue to consider and dispose off all residual pendency relating to the Brand rate applications. Accordingly, all references in this regard should be made to the jurisdictional Commissionerate of Central Excise with complete set of documents who shall deal with such references on the basis of the facts available of record.

• DIRECT TAXATION

Notification No. 29/2010 Dated 23.04.2010 Income-tax (Third Amendment) Rules, 2010, effective from April 1, 2010

New Income Tax Return Form SARAL II (ITR 1) for AY 2010-11 has been notified for Individuals having income from Salary/Pension/Income from One House Property (Excluding loss brought forward from previous years) / Income from Other Sources (Excluding winning from Lottery and Income from Race Horses) along with ITR Verification Form ITR-V for AY 2010-11 for SARAL II (ITR-1) ITR-2, ITR-3, ITR-4, ITR-5, ITR-6 & ITR-8 transmitted electronically without digital signature vide Income-tax (3rd Amendment) Rules, 2010.

Circular No.3/2010 Dated 02.03.2010 - TDS under Section 194A of the Income Tax Act, 1961 for Banks using Core-Branch Banking Solutions (CBS) software

Explanation to section 194A as was introduced with effect from 1.4.1987 by the Finance Act, 1987 not meant to apply in cases of banks where credit is made to provisioning account on daily/monthly basis for the purposes of macro monitoring only by the use of CBS software. Accordingly, it has been clarified by the CBDT that since no constructive credit to the depositor's / payee's account takes place while calculating interest on time deposits on daily or monthly basis in the CBS software used by banks, tax need not be deducted at source on such provisioning of interest by banks for the purposes of macro monitoring only.

In such cases, tax shall be deducted at source on accrual of interest at the end of financial year or at periodic intervals as per practice of the bank or as per the depositor's / payee's requirement or on maturity or on encashment of time deposits; whichever event takes place earlier; whenever the aggregate of amounts of interest income credited or paid or likely to be credited or paid during the financial year by the banks exceeds the limits specified in section 194A.

• MINISTRY OF LABOUR AND EMPLOYMENT

Notification Dated 20.04.2010 Employees' State Insurance (Central) Amendment Rules, 2010, effective from May 1, 2010

Wage limit for coverage of employee under the Employees' state Insurance Act, 1948 has been enhanced to fifteen thousand from ten thousand vide Employees' State Insurance (Central) Amendment Rules, 2010 with effect from 1st May, 2010.

• SECURITIES AND EXCHANGE BOARD OF INDIA

Circular No. CIR/MRD/DMS/13/2010 Dated 23.04.2010 Guidelines to be followed by stock brokers/ stock broker and depository participants in obtaining PoA from the clients

In order to protect the interests of investors in securities and to promote the development of, and to regulate the securities markets, SEBI has issued detailed guidelines to be followed by stock brokers/ stock broker and depository participants in obtaining Power of Attorney from the clients. The standardized the norms to be followed by stock brokers/ stock broker and depository participants while obtaining Power of Attorney from the clients has been provided therein.