• RESERVE BANK OF INDIA

Circular No. DCM. No. Dir. NPD. 3158/09.39.00 (Policy)/2009-10 Dated 19.11.2009 - RBI Directives under Section 35A of the Banking Regulation Act, 1949

Reserve Bank of India directs that banks shall ensure that all notes in the denomination of Rs. 100/- and above are processed through machines conforming to the standards / parameters prescribed by Reserve Bank of India from time to time, before issuing them over their counters or through ATMs and that all bank branches having average daily cash receipts of over Rs. 1 crore shall start using such machines by March 2010. Further, all bank branches having average daily cash receipts between Rs. 50 lakh to Rs. 1 crore shall have started using such machines by March 2011.

• SECURITIES EXCHANGE BOARD OF INDIA

Circular No. SEBI/IMD/DOF-1/BOND/Cir-5/2009 Dated 26.11.2009 - Simplified Debt Listing Agreement for Debt Securities - Amendments

SEBI has amended Simplified Debt Listing Agreement for Debt Securities with immediate effect. Major amendments effected in include 100% Asset Cover; Submission of certificate on maintenance of security; Statement on Use of Issue Proceeds; Deposit of 1% of issue proceeds and Submission/ publication of Financial Statements.

Circular No. OIAE/Cir-1/2009 Dated 25.11.2009 - Issue of No Objection Certificate for Release of 1% of Issue amount

As per amended guidelines vide this circular for issue of No Objection Certificate for Release of 1% of Issue Amount to issue companies, the issuer company shall submit an application on its letter head addressed to SEBI in the format specified in Annexure - A, after lapse of 4 months from listing on the Exchange which was the last to permit listing. The application shall be filed by the post issue lead merchant banker with the concerned designated office of SEBI under which the registered office of the issuer company falls, as specified in Annexure - B. On the date of application, the bank guarantees, if any, included in 1% deposit must have a residual validity of at least 2 months. SEBI shall then issue the NOC after satisfying itself that the complaints arising from the issue received by SEBI against the Company have been resolved to its satisfaction, the Company has been submitting monthly Action Taken Reports on the complaints forwarded by SEBI to the company as per the proforma specified in Annexure - C, and the fees due to intermediaries associated with the issue process including ASBA Banks have been paid.

• INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY

Circular No. IRDA/NL/CIR/F&U/073/11/2009 Dated 16.11.2009 - Liability of Insurance Companies in respect of Occupant of a Private Car and Pillion Rider in a Two-Wheeler under Standard Motor Package Policy [also called Comprehensive Policy]

 Guidelines regarding Liability of Insurance Companies in respect of Occupant of a Private Car and Pillion Rider in a Two-Wheeler under Standard Motor Package Policy [also called Comprehensive Policy] is as per Circular M.V. No. 1 of 1978 - dated 18th March 1978 [regarding occupants carried in Private Car] and MOT/GEN/10 dated 2nd June 1986 [regarding Pillion Riders in a Two-Wheeler]. The Authority vide circular no. 066/IRDA/F&U/Mar-08 dated March 26, 2008 and vide circular no. 019/IRDA/NL/F&U/Oct-08 dated November 6, 2008 has mandated that insurers are not permitted to abridge the scope of standard covers and or vary coverage, terms and conditions. Accordingly, all General Insurers are advised to adhere to the aforementioned circulars.

Circular No. IRDA/SUR/MISC/CIR/074/11/2009 Dated 17.11.2009 -Stoppage of Professional Services by Surveyors on 7th & 8th December 2009

As per communication from the President of Indian Institute of Surveyors & Loss Assessors (IIISLA) to Insurance Regulatory and Development Authority, the surveyors will stop providing professional services in respect of any claim on 7th & 8th December 2009. Hence in the interests of policyholders' servicing, the Authority has decided that in case the services of surveyors are not available, insurers may make use of in-house surveyors for survey and assessment of losses during the period of such stoppage of work by surveyors.

• DIRECT TAXATION

Circular No. 8/2009 Dated 24.11.2009 - Applicability of provisions under Section 194J of Income Tax Act'61 in the case of transactions by the Third Party Administrators (TPAs) with Hospitals etc.

Third Party Administrators (TPAs) who are making payment on behalf of insurance companies to hospitals for settlement of medical/insurance claims etc under various schemes including Cashless schemes are liable to deduct tax at source under section 194J on all such payments to hospitals etc. The Board has decided that no proceedings u/s 201 may be initiated after the expiry of six years from the end of financial year in which such payment have been made without deducting tax at source etc by the TPAs. Further, tax demand arising out of Section 201(1) in situations arising above, may not be enforced if the deductor(TPA) satisfies the officer in charge of TDS that the relevant taxes have been paid by the deductee assessee (hospitals etc.). However, this will not alter the liability to charge interest under Section 201 (1 A) of the Income Tax Act till payment of taxes by the deductee assessee or liability for penalty under Section 271C of the Income Tax Act as the case may be.

• INDIRECT  TAXATION

CBEC Customs

Circular regarding Setting up Private/Public Bonded Warehouse for Diamonds and Gemstones for Import and Re-export Therefrom

Circular No. 31/2009 Dated 24.11.2009:- In view of withdrawal of the scheme for setting up private/public bonded warehouse for diamonds and gemstones from Foreign Trade Policy 2009-14, no new private/public bonded warehouse license can be allowed for bonding of diamonds and gemstones for import and export thereform. Further, such a facility can also not be allowed for non-dutiable goods. Accordingly, the circular No. 28/98-Cus dated 24.04.1998 stands withdrawn to the above extent. As a transitory arrangement for the existing warehouses to surrender the bonding license, a period of three months is granted from the date of issue of this circular.