Knowledge Centre
Knowledge Centre
Every food business operator is now mandatorily required to display its 14-digit FSSAI Registration/ Licence Number on every of its receipts, invoices, bills, cash memo, food safety display boards in case of restaurants, caterers, mithai shops even retail stores etc. with effect from 1st October 2021. The only exemption as of now provided for GST e-way bill or such other documents which are system generated.
The display of FSSAI number shall improve the overall awareness about FSSAI and its requirements. In case of any grievance, consumers can lodge an online complaint against any particular food business by using such 14-digit number.
https://www.fssai.gov.in/upload/advisories/2021/06/60c08b4456ef1Order_License_Registration_Man
dating_09_08_2021.pdf
There is a requirement of a minimum vesting period at least of one year for ESOPs and SAR under SEBI (Share Based Employee Benefit) Regulations, 2014 (“SBEB Regulations”). In order to provide relief to the family of deceased employees in listed companies in the wake of Covid19 pandemic, SEBI provided a relaxation which will be effective from April 01, 2020, under regulation 18(1) and 24(1) r.w. regulation 9(4) of the said of the SBEB Regulations, in terms of non- applicability of minimum vesting period of one year in case of death (for whatsoever reason) of an
employee. Therefore, in such instances where an employee died after 1st April 2020, all stock options including stock appreciation rights (SARs) or any other benefit granted to such employee, will be vested immediately with his/her legal heir or nominee on the date of death of the employee.
https://www.sebi.gov.in/legal/circulars/jun-2021/relaxation-from-the-requirement-of-minimum-
vesting-period-in-case-of-death-of-employee-s-under-sebi-share-based-employee-benefit-regulations-
2014_50545.html
Ministry of Corporate Affairs (‘MCA’) on June 15, 2021, notified the amendment in Companies (Meetings of Board and its Powers) Rules, 2014 and by that amendment, Rule 4 has been permanently deleted. Rule 4 was related to the matters NOT TO BE DEALT during a virtual board meet. Now, with the deletion of that rule, Companies may consider following agenda items in their board meetings held through VC:
• approval of the annual financial statements and Board’s report;
• approval of the prospectus;
• Audit Committee meeting for recommendation of financial statements to Board;
• Matters related to amalgamation, merger, demerger, acquisition and takeover.
Previously, MCA has granted this relaxation on ad-hoc basis till June 30, 2021, keeping in view travelling restrictions due to pandemic but now said restriction is permanently deleted.
https://www.mca.gov.in/bin/dms/getdocument?mds=zwpAcIfQhKOgB8vwf%252FztbA%253D%253
D&type=open
SEBI has issued a circular in respect of automation of continual disclosures as per SEBI (PIT) Regulations, 2015 for system driven disclosures for inclusion of listed debt securities. It is stated in the circular to include the listed debt securities of equity listed companies under the purview of system driven disclosures for the entities. SEBI asked to the depositories and stock exchanges to make necessary arrangements so that necessary disclosures pertaining to listed debt securities along with equity shares and equity derivative instruments are disseminated on the websites of respective stockexchanges with effect from July 01, 2021.
https://www.sebi.gov.in/legal/circulars/jun-2021/automation-of-continual-disclosures-under-
regulation-7-2-of-sebi-prohibition-of-insider-trading-regulations-2015-system-driven-disclosures-for-
inclusion-of-listed-debt-securities_50572.html
In continuation of the Ministry’s following general circulars on the matter of holding general meetings by a Company through audio-video mode:
• Circular no. 14/2020 dated 8th April 2020;
• Circular no. 17/2020 dated 13th April 2020;
• Circular no. 22/2020 dated 15th June 2020;
• Circular no. 33/2020 dated 28th September 2020; and
• Circular no. 39/2020 dated 31st December 2020.
MCA informed to its stakeholders via its general circular no. 10/2021 dated 23rd June 2021, that theyhave decided to allow companies to conduct their EGMs through VC & OAVM or transact items through postal ballot for a further period up to 31st December 2021, in accordance with the guidelines detailed in aforesaid circulars.
https://www.mca.gov.in/bin/dms/getdocument?mds=fYGpVQRhK8ssM3lRSs7fsg%253D%253D&ty
pe=open
RBI issued on 24th June 2021, a set of guidelines on distribution of dividend by NBFCs, setting out norms for NBFC dividend distribution, which will be effective for the declaration of dividend from the profit of the FY22, and onwards.
This notification put a ceiling on dividend pay-out ratio. According to this notification, dividend pay- out ratio is the ratio between the amount payable as dividend in a year and net profit as per audited financial statements for that financial year in which the dividend is proposed. RBI casted obligation on the Board that while considering the proposals for dividend, the Board will take into account supervisory findings of the RBI/ NHB (for HFCs) on divergence in classification and provisioning for NPAs, any qualifications in the Auditors’ Report and long-term growth plans of the NBFC. Proposed dividend shall include both dividend on equity shares and compulsorily convertible preference shares eligible for inclusion in Tier 1 Capital.
Further, in case the PAT for the relevant period includes any exceptional or extraordinary profit or income or the financial statements are qualified (including ’emphasis of matter’) by the statutory auditor that indicates any overstatement of net profit, the same shall be reduced from net profits while determining the dividend payout ratio. Interestingly, it is mentioned in the Circular that the Reserve Bank shall not entertain any request for ad-hoc dispensation on declaration of dividend.Those NBFCs already have any extant Dividend Distribution Policy of their own, shall require to amendin order to include the additional parameters in line with this notification.
https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12118&Mode=0
Deposit includes any receipt of money by way of deposit or loan or in any other form by a Company, but does not include, amongst others as provided in Clause (c) of sub- rule 1 of Rule 2 of Companies (Acceptance of Deposit) Rules, 2014, an amount of Rs. 25 lakhs or more, received by a start-up company, by way of a Convertible Note* {convertible into equity shares or repayable within a period not exceeding 10 years (earlier 5 years) from the date of issue} in a single tranche, from a person.
*Whereas, Convertible Note is a kind of instrument which provides right to its holder either to get repayment as of a debt or gets converted into equity on fulfilment of certain conditions.
No company referred to in sub-section (2) of section 73 shall accept or renew any deposit from its members, if the amount of such deposits together with the amount of other deposits outstanding as on the date of acceptance or renewal of such deposits exceed 35% of the aggregate of the Paid-up share capital, free Reserves and securities premium account of the company.
Provided further that the maximum limit in respect of deposits to be accepted from members shall not apply to following classes of private companies, namely a private company which is a start-up, for ten years from the date of its incorporation.
Director General of Foreign Trade vide its notification No. 33/2015-2020 dated 28th September 2020 made it mandatory for traders to register themselves with the Steel Import Monitoring System (SIMS) to import all iron and steel products. Imports under all HS Codes of Chapter 72, 73 and 86 of ITC (HS) 2017 shall now require compulsory registration under the Steel Import Monitoring System (SIMS).
Now, your neighborhood sweet shop will need to declare “Best before date” of their offerings on the boxes.
The Food Safety and Standards Authority of India (FSSAI) has vide its order dated 25th September 2020, mandated display of “Best before date” in case of non-packaged/ loose sweets, the container, tray holding sweets at the outlet for sale with effect from 1st October, 2020. In addition to this Food Business Operator (FBO) can also display “Date of manufacturing” which shall be
voluntary and non-binding.
https://www.fssai.gov.in/upload/advisories/2020/09/5f6ddbe03942eOrder_Direction_Date_Sweets_25_09_20
20.pdf
The Ministry of Corporate Affairs has further extended the non-availability of Section 7, 9 and 10 of IBC, 2016 for another period of three months from the September 25, 2020 up to December 25, 2020. Thus, no insolvency proceedings can be initiated against any borrower for defaults arising on or after March 25, 2020, until such time that the said provisions under IBC remain suspended. Further, no application shall be filed for initiation of Corporate Insolvency Resolution Process of a Corporate Debtor for the said default occurring during the said period.
https://ibbi.gov.in/uploads/legalframwork/2987e1e33d62d2e1781c700ee16baa36.pdf
The Department for Promotion of Industry and Internal Trade (DPIIT) on 17th September, 2020 issued a press
note permitting foreign direct investment (FDI) in defense production up to 74 per cent through the automatic route from previous pre-approved threshold of 49 per cent for Companies seeking new industrial licenses and for other Companies already having Government approval for FDI in defense it will remain same as earlier.
This would be subject to access to modern technology or for ‘other reasons’ that needs to be recorded. However, foreign investments in the defense sector would be subject to scrutiny on the grounds of national security and the government reserves the right to review any foreign investment in the sector that affects or may affect national security, the Department for Promotion of Industry and Internal Trade (DPIIT) said in the
note.
FSSAI is launching a new upgraded food safety compliance online platform called Food Safety Compliance System (FoSCoS). It has already been operational in 9 States/UTs viz. Tamil Nadu, Delhi, Gujarat, Odisha, Chandigarh, Goa, Manipur, Puducherry and Ladakh since 1st June 2020. FSSAI is now ready to extend FoSCoS to entire country from 1st November 2020.
It will replace the existing FLRS (Food Licensing and Registration System). FoSCoS is conceptualized to provide one point stop for all engagement of a Food Business Operator (FBO) with the department for any regulatory compliance transaction. FoSCoS essentially has flows like FLRS, so that users have convenience in migrating to FoSCoS. The paradigm change is the shift of methodology of licensing for manufacturers which now shall be based on standardised product list. This will help in quicker grant of licences and eliminate any errors
The Patent (Amendment) Rules 2020, have come into force from 20 October 2020 with major changes outlined below. First thing first, is that now a statement of commercial working of patented invention will have to be filed by every patentee and every licensee for every financial year i.e. 1 April to 31 March within 6 months from the start of the next financial year i.e. by 30 September of the year next to the financial year for which statement is being filed.
Form 27, i.e. statement regarding commercial working of a patented invention has also been amended whereby one Form can be submitted for multiple patents, provided all of them are related patents along with the following information:
• In case the patented invention has been worked, approximate revenue / value (instead of quantum and value) accrued in India to the patentee through manufacturing and/or importing along with a brief write-up on the same will have to be provided.
• In case the patented invention has not been worked, reasons for not
working the patented invention and steps being taken for working of the patented invention will have to be provided.
• The requirements of submitting information regarding licensees and sub-licensees granted in a year; and information regarding extent of working (partly, adequately, fullest) of the patented invention has also been done away with in the amended form.
While patentees can jointly file the statement of commercial working, each licensee will have to file the statement of commercial working individually.
Further, the rules in relation to filing of priority document and Englishtranslation (if applicable) for Indian national phase patent applications has been amended to include certain PCT regulations. However, the timelinefor submission of the priority document and English translation remains the same.
http://www.ipindia.nic.in/writereaddata/Portal/Images/pdf/patents_amendment_rules_2020.pdf
On the recommendations of the GST Council, it has been decided to extend the due date for filing Annual Return (FORM GSTR-9/GSTR-9A) and Reconciliation Statement (FORM GSTR-9C) for Financial Year 2018-19 from 31st October 2020 to 31st December, 2020.
It may be noted that filing of Annual Return (FORM GSTR-9/ GSTR-9A) for 2018-19 is optional for taxpayers who had aggregate turnover below Rs. 2 crore. The filing of reconciliation Statement in FORM 9C for 2018-19 is also optional for the taxpayers having aggregate turnover upto Rs. 5 crore.
GSTR-9 is an annual return to be filed yearly by taxpayers registered under the goods and services tax (GST). It consists of details regarding the outward and inward supplies made or received under various tax heads. GSTR-9C is a statement of reconciliation between GSTR-9 and the audited annual financial statement. Furnishing of the annual return is mandatory only for taxpayers with an aggregate annual turnover above ₹2 crore, while reconciliation statement is to be furnished only by the registered persons having an aggregate turnover above ₹5 crore.
On direction of Supreme Court, the Department of Financial Services of Finance Ministry has approved operational guidelines for a scheme for grant of Ex-Gratia payment of the difference between compound interest and simple interest for six months (01.03.2020 to 31.08.2020) of loans up to Rs 2 crore, under the RBI moratorium scheme in view of the COVID-19 pandemic.
The rate of interest would be as prevailing on 29.02.2020, i.e. in case the rate of interest has changed thereafter, it shall not be reckoned for the purposes of this computation. The payable Ex-Gratia amount shall have to be credited to the account of the borrower by the respective lending institutions as ex-gratia payment under the scheme.
Ex-Gratia shall be credited on or before 05.11.2020 by the lending institution and in turn lodge a claim for reimbursement from Central Govt latest by 15.12.2020 to designated officer(s) / cell at the State Bank of India (SBI). Claim should be pre-audited by the Statutory Auditor of the lending institutions and a certificate in this regard shall be attached to the claim.
https://financialservices.gov.in/sites/default/files/Scheme%20Letter.pdf
Indian Firm MagFast Beverages wins against PepsiCo to use of trademark “Mountain Dew” after a 15 year legal battle. Hyderabad court has dismissed the suit filed by Pepsico. The Additional Chief Judge of the City Civil Court of Hyderabad has recently ruled that the Hyderabad-based Magfast Beverages enjoys prior user rights over an identical trademark for their packaged drinking water (‘PDW’) business.