Saturday, July 27, 2019

Direct Selling Legislation

PIB press release dated 27th July, 2019

Ministry of Consumer Affairs, Food & Public Distribution, Department of Consumer Affairs notified the Direct Selling Guidelines, 2016 in the Gazette of India on 26.10.2016 as guiding principles for State Governments to consider regulating the business of direct selling and multi-level marketing and strengthen the existing regulatory mechanism on direct selling and multi-level marketing for preventing fraud and protecting the legitimate rights and interests of consumers. State Governments/Union Territories, being enforcement agencies, may take necessary action to implement these guidelines. In terms of the Direct Selling Guidelines, 2016, State Governments will set up a mechanism to monitor/supervise the activities of direct sellers, direct selling entities regarding compliance with the guidelines. Besides, the Consumer Protection Bill, 2019 has been introduced in Lok Sabha on 8th July, 2019 which seeks to provide the measures to be taken by the Central Government to prevent unfair trade practices in direct selling.

In terms of the Direct Selling Guidelines, 2016, no person or entity will participate in money circulation scheme in the garb of direct selling business. Ministry of Finance, Department of Financial Services has intimated that there is no information available with them that law enforcement agencies are wrongfully booking genuine direct selling firms under the Prize Chits and Money Circulation Scheme (Banning) Act, 1978.

This information was given in a written reply by the Minister of State for   Consumer Affairs, Food & Public Distribution, Shri Danve Raosaheb Dadarao in the Rajya Sabha today.

Friday, July 26, 2019

web based DIR-3-KYC

MCA has vide its notification dated 25th June, 2019 amended the Companies (Appointment and Qualification of Directors), Rules, 2014 as follows:

1) a new system of web based DIR-3-KYC is being introduced. Basically it is for those directors who have already done the form based DIR-3-KYC once before.

2) Any Director who holds a DIN as on 31st March of a financial year shall be required to do the form based DIR-3-KYC on or before 30th September of the next financial year, i.e. those directors who were allotted DIN during the financial year 2018-19 will be required to do a one time form based DIR-3-KYC on or before 30th September, 2019. Once he has done a form based DIR-3-KYC, then he need not do the form based compliance again.  On second and subsequent attempts, it is to be a web based DIR-3-KYC compliance for that financial year. Again for the next year, he will have to do a web based DIR-3-KYC compliance.

3) All those directors who did the form based DIR-3-KYC last year, will be required to do the web based DIR-3-KYC this year.

4) Any director who wants to update his personal e-mail id or mobile no. then it has to be done via a form based DIR-3-KYC only.

5) The fee for the form based DIR-3-KYC or the web based DIR-3-KYC is NIL if it is done within the stipulated date. In case of any delay, then fees of Rs.5000/- will be applicable to both the form based DIR-3-KYC and the web based DIR-3-KYC.

The MCA notifications are available on the MCA site.





Bidding guidelines for wind power projects

PIB press release dated 25th July, 2019

MNRE amends bidding guidelines for wind power projects



The Guidelines for Tariff Based Competitive Bidding Process for Procurement of Power from Grid Connected Wind Power Projects was notified on 8th December, 2017. Based on experience of bidding and after consultation with stakeholders, following amendment to these standard bidding guidelines for wind power projects, is carried out:
  1. The timeline for land acquisition for wind power projects has been extended from seven months to scheduled commissioning date, i.e. 18 months. This will help wind power project developers in states where land acquisition takes longer time.
  2. The window for revision of declared Capacity Utilisation Factor (CUF) of wind power project has been increased to three years. The declared CUF is now allowed to revise once within three year of commercial operation date, which was earlier allowed within one year only.
  3. The penalty on shortfall in energy corresponding to the minimum CUF, has now been fixed @ 50% (fifty percent) of the PPA tariff for the shortfall in energy terms liable to be paid by the Wind Power Generator to the Procurer. Further, the penalty shall be passed on by the Intermediary Procurer to the End Procurer after deducting the losses of Intermediary procurer.
  4. In cases of early part commissioning, the Procurer may purchase the generation, at full PPA tariff.
  5. Commissioning Schedule of wind power project has been defined as 18 (eighteen) months from the date of execution of the PPA or PSA, whichever is later.
The amendments intended not only to reduce the investment risks related to the land acquisition and CUF but also to provide incentives for early part commissioning of project. The subjectivity in penalty provisions has been removed and the penalty rate has been fixed. The risk of wind power developers in case of delay in signing of PSA has been mitigated by starting timeline of execution of project from date of signing of PPA or PSA, whichever is later.

Thursday, July 25, 2019

Bankruptcy Code Amendments

PIB press release dated 25th July, 2019

The Insolvency and Bankruptcy Board India (IBBI) notified regulations related to the Insolvency and Bankruptcy Board of India (Insolvency Professionals) (Amendment) Regulations, 2019, and the Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) (Amendment) Regulations, 2019.

The salient amendments effected by the Insolvency and Bankruptcy Board of India (Insolvency Professionals) (Amendment) Regulations, 2019 are:
    1. An insolvency professional shall not accept or undertake any assignment as interim resolution professional, resolution professional, liquidator, bankruptcy trustee, authorised representative or in any other role under the Insolvency and bankruptcy Code, 2016 unless he holds an ‘Authorisation for Assignment’ issued by his Insolvency Professional Agency. This is effective from 1st January, 2020.
    2. An insolvency professional shall not engage in any employment when he holds an Authorisationfor Assignment or when he is undertaking an assignment. This would enable an individual to seek registration as an insolvency professional even when he is in employment. He must, however, discontinue employment when he wishes to have an Authorisation for Assignment. He may surrender Authorisation for Assignment when he wishes to take up employment.
    3. Where an insolvency professional has  conducted a corporate insolvency resolution process, he and his relatives shall not accept any employment, other than an employment secured through open competitive recruitment, with, or render professional services, other than services under the Code to a creditor having more than ten percent voting power, the successful resolution applicant, the corporate debtor or any of their related parties, until a period of one year has elapsed from the date of his cessation from such process.
    4. An insolvency professional shall not engage or appoint any of his relatives or related parties, for or in connection with any work relating to any of his assignment.

The salient amendments effected by the Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) (Amendment) Regulations, 2019 are:
    1. An Insolvency Professional Agency shall issue/renew an Authorisation for Assignment to insolvency professionals in accordance with its Bye-laws.
    2. Subject to meeting other requirements, an insolvency professional shall be eligible to obtain an Authorisation of Assignment if he has not attained the age of seventy years.
    3. Subject to meeting other requirements, an individual may serve as an independent director on the Governing Board of an Insolvency Professional Agency up to the age of seventy-five years.

These amendment regulations are effective from 23rd July, 2019. These are available atwww.mca.gov.in and www.ibbi.gov.in.

Wednesday, July 24, 2019

Code on Occupational Safety, Health & Working Conditions

PIB press release dated 23rd July, 2019

The Minister of State (I/C) for Labour and Employment Shri Santosh Kumar Gangwar introduced The Code on Occupational Safety, Health and Working Conditions Bill, 2019 in Lok Sabha today to amend the laws regulating the Occupational Safety, Health and Working Conditions of the persons employed in an establishment. Shri Gangwar said that the proposed bill is being introduced after wide consultations with Trade Unions, employers and all the other stakeholders. 
Safety, Health, welfare and improved Working Conditions are pre-requisite for well being of the worker and also for economic growth of the country as healthy workforce of the country would be more productive and occurrence of less accidents and unforeseen incidents would be economically beneficial to the employers also.
With the ultimate aim of extending the safety and healthy working conditions to all workforce of the country, the Code enhances the ambit of provisions of safety, health, welfare and working conditions from existing about 9 major sectors to all establishments having 10 or more employees. The proposed Code enhances the coverage of workers manifold as it would be applicable to all establishments employing 10 or more workers, where any industry, trade, business, manufacture or occupation is carried on, including, IT establishments or establishments of service sector. Further the varying threshold of applicability has been made uniform at 10 workers for all establishments except mines and dock where the Code would be applicable even with 1 worker. In order to ensure wider coverage, the definitions of Working Journalists and Cine worker have also been modified to include workers employed in electronic media and all forms of audio visual production. Similarly, the definition of inter-state migrant worker has also been proposed to be modified to include those migrant workers who are being employed directly by the employer from other States without contractor or agent. This proposal would enhance the coverage of the safety, health and working conditions provisions manifold as compared to the present scenario.
Besides, extending the ambit of Occupational safety, Health and Working conditions to all sectors, other salient features of the Code on Occupational Safety, Health and Working Conditions are as under:
i. The Code provides basic broad legislative framework with enabling provisions for framing rules, regulations, standards, and bye-laws as per the requirements of different sectors which has Resulted in reduction of 622 sections to 134 sections in the Code. This would result in simple legislation with flexibility in changing the provisions in tune with emerging technologies and makes the legislation dynamic.
ii. The Bill proposes one registration for an establishment instead of multiple registrations. Presently 6 labour acts out of 13 provide for separate registration of the establishment. This will create a centralized data base and promote ease of doing business. At present, separate registration is required to be obtained under 6 Acts.
iii. Employer to provide free of cost annual health checks-up for employees above prescribed age for prescribed tests and for prescribed establishments. Increases productivity as it would be possible to detect diseases. Coverage of employees above a certain age for health check-up would promote inclusion.
iv. First time statutory provision to issue appointment letter to every employee of the establishment with the minimum information prescribed by the appropriate government. The provision of appointment letter will result in formalization of employment and prevent exploitation of the worker.
v. The multiple committees under five labour Acts have been substituted by one National Occupational Safety and Health Advisory Board. The National Board is of tripartite nature and has representation from trade unions, employer associations, and State governments. This will result in reduction in multiplicity of bodies/committees in various Acts and simplified and coordinated policy-making.
vi. Enabling provision for constituting a bi-partite Safety Committee in any class of establishment by appropriate government. It will promote safe and healthy working conditions in an establishment. The participatory nature of the committee will encourage implementation of decisions taken by the management.
vii. A part of the penalty for contravention of provisions relating to duties of employer leading to death or serious bodily injury to any person may be given to the victim or the legal heirs of the victim by the Court. The part of penalty would help in rehabilitation of injured worker or would provide financial support to the family of deceased.
viii. Presently, different applicability thresholds exists for welfare provisions like crèche, canteen, first aid, welfare officer etc in different Acts. The proposed Code has envisaged uniform threshold for welfare provisions for all establishment as far as practicably feasible.
ix. Women permitted to work beyond 7 PM and before 6 AM subject to the safety, holidays, working hours or any other condition as prescribed by appropriate government in respect of prescribed establishments. However, only after taking their consent for night work. This will promote gender equality and is in tune with demands from the various forums including international organizations as it leads to protective discrimination. Further, the condition of taking consent/ willingness of the women employee for night work would avoid any kind of misuse of the provision.
x. The provision of one license and one return in place of multiple licenses and returns in existing 13 labour laws subsumed in this Code to save time, resources and efforts of establishments.
From the above salient features of the Code, it is evident that the Occupational Safety, Health and Working Conditions has some unique new initiatives for both workers and employers. It promotes health, safety, welfare and better working conditions of workforce by enhancing the ambit of a dynamic legislation as compared to the existing sectoral approach limited to few sectors. Besides, it also drastically rationalises the compliance mechanism with one license, one registration and one return for the establishments under the ambit of the Code thereby saving resources and efforts of the employers. Thus it balances the requirements of worker and employer and is beneficial to both the constituents of the world of work.
The Code has been drafted after amalgamation, simplification and rationalisation of the relevant provisions of the 13 Central Labour Acts viz. The Factories Act, 1948;The Mines Act, 1952;The Dock Workers (Safety, Health and Welfare) Act, 1986 ;The Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996 -,The Plantations Labour Act, 1951; The Contract Labour (Regulation and Abolition) Act, 1970; The Inter-State Migrant workmen (Regulation of Employment and Conditions of Service) Act, 1979; The Working Journalist and other News Paper Employees (Conditions of Service and Misc. Provision) Act, 1955; The Working Journalist (Fixation of rates of wages) Act, 1958; The Motor Transport Workers Act, 1961; Sales Promotion Employees (Condition of Service) Act, 1976; The Beedi and Cigar Workers (Conditions of Employment)Act, 1966 and The Cine Workers and Cinema Theatre Workers Act, 1981. After the enactment of the Code, all these Acts being subsumed in the Code will be repealed.

Code on Wages Bill 2019

PIB press release dated 23rd July, 2019

The Minister of State (I/C) for Labour and Employment Shri Santosh Kumar Gangwar introduced The Code on Wages Bill, 2019 in Lok Sabha today to amend and consolidate the laws relating to wages and bonus and matters connected therewith.
The Code on Wages Bill, 2019 subsumes relevant provisions of The Minimum Wages Act, 1948, The Payment of Wages Act, 1936, The Payment of Bonus Act, 1965 and The Equal Remuneration Act, 1976. After the enactment of the Code on Wages, all these four Acts will get repealed. The salient features of the Code are as following:
 The Code on Wage universalizes the provisions of minimum wages and timely payment of wages to all employees irrespective of the sector and wage ceiling. At present, the provisions of both Minimum Wages Act and Payment of Wages Act apply on workers below a particular wage ceiling working in Scheduled Employments only. This would ensure "Right to Sustenance" for every worker and intends to increase the legislative protection of minimum wage from existing about 40% to 100% workforce. This would ensure that every worker gets minimum wage which will also be accompanied by increase in the purchasing power of the worker thereby giving fillip to growth in the economy. Introduction of statutory Floor Wage to be computed based on minimum living conditions, will extend qualitative living conditions across the country to about 50 crore workers. It is envisaged that the states to notify payment of wages to the workers through digital mode.
• There are 12 definitions of wages in the different Labour Laws leading to litigation besides difficulty in its implementation. The definition has been simplified and is expected to reduce litigation and will entail at lesser cost of compliance for an employer. An establishment will also be benefited as the number of registers, returns, forms etc., not only can be electronically filed and maintained, but it is envisaged that through rules, not more than one template will be prescribed.
• At present, many of the states have multiple minimum wages. Through Code on Wages, the methodology to fix the minimum wages has been simplified and rationalised by doing away with type of employment as one of the criteria for fixation of minimum wage. The minimum wage fixation would primarily based on geography and skills. It will substantially reduce the number of minimum wages in the country from existing more than 2000 rates of minimum wages.
• Many changes have been introduced in the inspection regimes including web based randomised computerised inspection scheme, jurisdiction-free inspections, calling of information electronically for inspection, composition of fines etc. All these changes will be conducive for enforcement of labour laws with transparency and accountability.
 • There were instances that due to smaller limitation period, the claims of the workers could not be raised. To protect the interest of the workers, the limitation period has been raised to 3 years and made uniform for filing claims for minimum wages, bonus, equal remuneration etc., as against existing varying period between 6 months to 2 years.
• It can be said that a historical step for ensuring statutory protection for minimum wage and timely payment of wage to 50 crore worker in the country has been taken through the Code on Wages besides promoting ease of living and ease of doing business.
The Code on Wages Bill was earlier introduced in the Lok Sabha on 10th August 2017 and was referred to Parliamentary Standing Committee which submitted its Report on 18th December 2018. However, owing to dissolution of 16th Lok Sabha, the Bill has lapsed. Therefore, a fresh Bill namely The Code on Wages Bill, 2019 has been drafted inter alia, after considering the recommendations of the Parliamentary Standing Committee and other suggestions of the stakeholders.

Income Tax Returns

PIB press release dated 23rd July, 2019

The due date for filing of Income Tax Returns for Assessment Year 2019-20 is 31.07.2019 for certain categories of taxpayers. Upon consideration of the matter, the Central Board of Direct Taxes(CBDT) extends the ‘due date’ for filing of Income Tax Returns from 31st July, 2019 to 31st August, 2019 in respect of the said categories of taxpayers.

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