• INDIRECT TAXATION

SERVICE TAX

Notification No. 36/2009-ST Dated 09.09.2009 - Notification No. 28/09-ST dated 31.08.09 stands rescinded by No. 36/09-ST dt 09.09.2009. 

The Ministry of Finance in exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) has rescinded the notification published in the Gazette of India, Extraordinary, vide number G.S.R. 617 (E), dated the 31st August, 2009 which was issued to exempt services u/s 65(105)(zzzp) of Fin. Act 1994 in relation to transport of Goods by rail. Later No 33/09 dated 01.09.09 was issued exempting whole of Service Tax leviable with nothing to apply on service by person other than Government Railway for transport of goods in containers by rail.

• MINISTRY OF COMMERCE AND INDUSTRY

Policy Circular No. 7/2009-14 Dated 16.09.2009 - Constitution of committee for exporters' problems

The Ministry of Commerce and Industry has decided to constitute an Inter-Ministerial Committee to redress/resolve problems/issues of exporters to discuss issues raised by exporters which affect the exporting community as a class. It shall not address individual grievances for which other forums exist. The Committee shall be chaired by Secretary, Department of Commerce and will have representatives from DGFT, Department of Revenue, Department of Economic Affairs, Reserve Bank of India, and Directorate General of Export Promotion (CBEC) and in addition, any other administrative Ministry of Govt. of India may be co-opted for a particular meeting, in case issues concerning them are raised. The Committee would meet once in every quarter.

• MINISTRY OF LAW AND JUSTICE

Notification No. SO2313 (E) Dated 11.09.2009- Notification for effective date of Gram Nyayalayas Act, 2008

The Central Government has appointed 2 October 2009 as the date on which the provisions of the Gram Nyayalayas Act, 2008 shall come into force in the areas to which this Act as provided in sub-section 2 of section 1 of the Act extends.

• MINISTRY OF URBAN DEVELOPMENT

Notification No. SO2279 (E) Date of Notification: 07.09.2009 - Application of Provisions of Metro Railways (Amendment) Act, 2009

The Central Government in exercise of the powers conferred by sub-section (2) of Section 1 of the Metro Railways (Amendment) Act, 2009 has appointed 7 September 2009 as the date on which the provisions of the said Act shall come into force.

• PRESS INFORMATION BUREAU

Dated 10.09.2009 - Release of additional installment of Dearness Allowance, Relief to Central Government Employees.

Based on recommendations of 6th Pay Commission the cabinet has decided to release an additional installment of DA and DR to Pensioners w.e.f. 01.07.2009 representing an increase of 5% over the existing rate of 22% of the Basic Pay/Pension to compensate for price rise.

Dated 17.09.2009 - CERC Notifies Tariff Regulations for Green Power

Central Electricity Regulatory Commission, CERC has notified the tariff regulations for electricity generated from renewable energy sources. CERC Chairman, Dr. Pramod Deo said that these regulations assume special importance in view of the National Action Plan on Climate Change which stipulated that minimum renewable purchase standards may be set at 5% of the total power purchases in year 2010 and thereafter should increase by 1% each year for ten years. He said the new tariff regulations are expected to promote new investments so that renewable electricity supply could expand to meet the goals stipulated in the National Action Plan. Specifying capital cost norms and fixing tariff upfront for the whole tariff period are the two main features of the new regulations. The regulations provide normative capital costs for projects based on different renewable technologies. These capital costs are to be revised every year for incorporating the relevant escalations. The norms themselves would be reviewed in the next control period which will start after a period of three years.

Dated 17.09.2009 - Term of Thirteenth Finance Commission extended

The Thirteenth Finance Commission shall extend office upto 31.10.2009. The Commission had requested for extension of term upto 31st January, 2010 due to postponement of some State visits because of the general elections to the 15th Lok Sabha and certain State Legislative Assemblies resulting in delay in the presentation of the Union Budget as well as the Budgets of some of the State Governments for the year 2009-10. The Commission has been requested to submit its Report by 31st December, 2009 so that Government's decision on their recommendations could be given effect to in the Budget 2010-11 as its recommendations will cover the period of five years from 1.4.2010 to 31.3.2015.

Dated 17.09.2009 -  Extension of validity of Central Orders dated 02.04.2009 in respect of Pulses, Paddy, Edible Oils, Edible Oilseeds and Rice and Central Order in respect of sugar

The Union Cabinet has given its approval for extending the validity of the Central Notification No. S.O.905 (E) dated 02.04.2009 and S.O. No.906 (E) dated 02.04.2009 issued in respect of pulses, paddy, edible oilseeds and rice for a further period from 01.10.2009 to 30.09.2010. The Central Notification No. S.O.1621 (E) dated 02.07.2009 issued in respect of sugar is to be extended for a further period from 09.01.2010 to 30.09.2010. The main objective of Control Orders is to enable the State Governments to continue to take effective de-hoarding operations under Essential Commodities Act, 1955 by fixing stock limits/licensing requirements etc. in respect of these commodities especially in view of rising prices and unsatisfactory monsoon in the prevailing circumstances. This is expected to help in the efforts being taken to tackle the problem of rising prices and also improve the availability of these commodities to general public especially the vulnerable sections.

Dated 17.09.2009 - Cabinet approves Ministry proposals for amending Transplantation of Human Organs Act, 1994

For making organs transplantation more transparent and patient friendly, Cabinet has approved the proposals of the Ministry of Health & Family Welfare to amend the provisions of the Transplantation of Human Organs Act, 1994 and impose stringent penalties on persons/hospitals violating the provisions of the Act.

Dated 14.09.2009 - India and Hong Kong sign Mutual Legal Assistance Agreement in Criminal Matters

An agreement for mutual legal assistance in criminal matters has been signed between India and China. The Agreement aims at improving effectiveness of law enforcement of the Contracting Parties in investigation and prosecution of crime and confiscation of proceeds and instruments of crime. With the signing of the Mutual Legal Assistance Agreement in criminal matters, cooperation in judicial matters will be comprehensive. The Agreement will come into force 30 days after the date on which the Parties have notified each other that their respective requirements for the entry into force of the Agreement have been complied with.

• RESERVE BANK OF INDIA

A. P. (DIR Series) Circular No. 08 ; Dated 14.09.2009 - RBI permits diplomatic missions to credit visa fees collected in India in Indian rupees by way of account transfer

After consulting the Government of India, Reserve Bank of India has decided to permit diplomatic missions to credit the visa fees collected in India in Indian rupees by way of transfer from the rupee account to the accounts maintained in foreign currency by the diplomatic missions, in addition to proceeds of inward remittances received from outside India through normal banking channels. Necessary amendment to the Foreign Exchange Management (Deposit) Regulations, 2000 dated May 3, 2000 has been notified vide Notification No. 193/2009-RB dated June 2, 2009 (G.S.R. No. 442(E) published in the Official Gazette of Government of India dated June 23, 2009). Accordingly, AD Category -I banks may allow the diplomatic missions to credit the visa fees collected in India in Indian rupees, by way of transfer from the rupee account, to the account maintained in foreign currency by the diplomatic missions.

Circular No. DBS.CO.FrMC.BC.No.7/23.04.001/2009-10 Dated 16.09.2009 - Role of Chairman / CEOs' of banks in Fraud Risk Management System

Keeping in view the concerns expressed by the Board for Financial Supervision (BFS) which banks are advised to initiate necessary action relating to fraud risk management and fraud investigation function at their end at the earliest. Banks may, with the approval of their respective Boards, frame internal policy for fraud risk management and fraud investigation function, based on the above governance standard relating to the ownership of the function and accountability for malfunctioning of the fraud risk management process in their banks. The Board has observed that in terms of higher governance standards, the fraud risk management and fraud investigation function must be owned by the bank's CEO, its Audit Committee of the Board and the Special Committee of the Board, atleast in respect of high value frauds. And accordingly, they should own responsibility for systemic failure of controls or absence of key controls or severe weaknesses in controlling exceptionally large value frauds and sharp rises in frauds in specific business segments leading to large losses for the bank.

• SECURITIES EXCHANGE BOARD OF INDIA

Circular No. SEBI/IMD/CIR No. 8/176988/2009 Dated 16.09.2009 - Systems Audit of Mutual Funds

Mutual funds shall have a systems audit conducted by an independent CISA/CISM qualified or equivalent auditor. The department has ruled that the systems audit should be comprehensive encompassing audit of systems and processes inter alia related to examination of integration of front office system with the back office system, fund accounting system for calculation of net asset values, financial accounting and reporting system for the AMC, Unit-holder administration and servicing systems for customer service, funds flow process, system processes for meeting regulatory requirements, prudential investment limits and access rights to systems interface. It is advised to get the above systems audit conducted once in two years and further it is advised to place the Systems Audit Report and compliance status before the Trustees of the mutual fund. The systems audit report/findings along with trustee comments should be communicated to SEBI. For the financial years April 2008 - March 2010, the systems audit should be completed by September 30, 2010.