Draft Law on Ponzi Schemes

In view of the number of complaints with regard to the unauthorized deposit taking activities and duping of gullible people by unscrupulous elements, the Government had constituted an Inter-Ministerial Group (IMG) in the Department of Economic Affairs (DEA), for identifying gaps in the existing regulatory framework for deposit-taking activities and to suggest administrative/ legislative measures, including formulation of a new law, to cover all relevant aspects of deposit-taking. The IMG finalized its Report and recommended a number of legislative and non-legislative/ administrative measures. The IMG’s legislative recommendations included the enactment of a new Central legislation called the Banning of Unregulated Deposit Schemes and Protection of Depositors’ Interests Bill (“Banning Bill”) in order to tackle the menace of illicit deposit taking schemes.
 A copy of the Report of the IMG along with the draft “Banning of Unregulated Deposit Schemes and Protection of Depositors’ Interests Bill” was placed on the website of the Department of Financial Services (DFS) in March, 2016 for eliciting public comments. Based on the comments received and further detailed consultations with the stakeholders, the Draft Bill was modified. A second round of public consultation on the revised draft bill has been carried out by placing it on the web-site of DFS on 17.11.2016 and writing to all the relevant stakeholders.
 The Department of Consumer Affairs has placed on its website an advisory to all the State Governments / Union Territories on Model Guidelines to strengthen the existing regulatory mechanism on Direct Selling and Multi-Level Marketing (MLM), for preventing fraud and protecting the legitimate rights and interests of consumers. The Clause 8 of the Advisory is on Prohibition of Pyramid Scheme & Money Circulation Scheme and states that (i) No person or entity shall promote a Pyramid Scheme, as defined in Clause 1(11) of the advisory or enroll any person to such scheme or participate in such arrangement in any manner whatsoever in the garb of doing Direct Selling business; (ii) No person or entity will participate in Money Circulation Scheme, as defined in Clause 1(12) of the advisory in the garb of Direct Selling of Business Opportunities.
 This was stated by Shri Santosh Kumar Gangwar, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.


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Sweat Equity for Start-Ups

The Ministry of Corporate Affairs vide notification GSR 704 (E) dated 19.07.2016 has amended Companies (Share Capital and Debentures) Rules, 2014 to allow a startup company as defined in notification GSR number 100 (E) dated 17.02.2016 issued by Department of Industrial Policy and Promotion, to issue sweat equity shares not exceeding fifty per cent of its paid up capital upto five years from the date of its incorporation or registration.

This was stated by Shri Arjun Ram Meghwal, Minister of State for Corporate Affairs in written reply to a question in Lok Sabha today.



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33rd India Carpet Expo to be inaugurated by Union Textiles Minister

The Carpet Export Promotion Council is organizing the 33rd India Carpet Expo, a sourcing platform for handmade carpets and other floor coverings, from 27-30 March, 2017 in Hall No. 11, 12 & 12A, Pragati Maidan, New Delhi. The Expo, one of Asia’s largest handmade carpet fairs, will be inaugurated by the Union Textiles Minister, Smt. Smriti Zubin Irani, on March 27, 2017. Minister of State for Textiles, Shri Ajay Tamta; Textiles Secretary, Smt. Rashmi Verma, other officials and representatives from trade and media would also be present.

The Expo is being organized to promote the cultural heritage of Indian handmade carpets and other floor coverings, and the weaving skills of their makers, amongst visiting overseas carpet buyers. The Expo is an ideal platform for international carpet buyers, buying houses, buying agents and architects to meet with and establish long-term business relationships with Indian carpet manufacturers and exporters. It is a unique platform for buyers to source the best handmade carpets, rugs and other floor coverings under one roof. The Expo has established itself as a popular sourcing platform for carpet buyers from all over the globe. India’s unique capability in adapting to any type of design, colour, quality and size, as per the specifications of carpet buyers has made it a household name in the international market.

The 33rd edition has received an overwhelming response from member exporters; 305 exhibitors are displaying their products in the show. Around 410 Carpet importers from 55 countries, mainly from Australia, Brazil, Canada, China, Chile, Germany, Mexico, Russia, Singapore, South Africa, Turkey, U.K. and USA have registered for the Expo. Notably, Bulgaria, Israel, Malaysia, Mauritius, Taiwan, Zimbabwe, Vietnam, Serbia and Hungary are being represented for the first time at the Mega Expo.
Besides inviting and incentivizing wholesale buyers to the Expo, CEPC is also providing a two-night complementary hotel stay for them at New Delhi.

Chairman, CEPC, Mr. Mahavir Pratap Sharma has said that this exhibition and buyer-seller meet will be the first step in taking Indian exports of handmade carpets to greater heights.

CEPC is confident that the Expo will generate good business and has requested the media to extend their full support for promotion of the event, so as to facilitate participants in acquiring handsome business. 







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ITD conducted searches in about 2534 groups of persons led to admission of undisclosed income of about Rs. 45,622 crore apart from seizure of undisclosed assets (cash, jewellery etc) worth about Rs. 3,625 crore

As part of enforcement measures and based upon credible evidence of tax evasion and other serious violations of provisions of the Income-tax Act, 1961 (the Act), Income Tax Department (ITD) conducts searches in cases of various persons including companies and individuals. During the last three Financial Years (2013-14, 2014-15 and 2015-16) and the current Financial Year [2016-17 (up to January, 2017)], the ITD conducted searches in about 2534 groups of persons which led to admission of undisclosed income of about Rs. 45,622 crore apart from seizure of undisclosed assets (cash, jewellery etc) worth about Rs. 3,625 crore.
 Based upon material recovered during searches, investigation is conducted by the investigating officers and findings of such investigations are shared with the Assessing Officers concerned. Such Assessing Officers initiate and complete assessment proceedings (a quasi-judicial proceeding) as per provisions of the Act with a view to assess the total income (including undisclosed income) and take other actions such as raising of tax demand, levy of applicable penalties, recovery of such demands, filing of prosecution complaints, (wherever applicable) etc. This is an on-going process.
 The Government has taken various effective measures to tackle breach of law and tax evasion. These steps include focused enforcement actions and putting in place appropriate legislative & administrative frame works & processes. Due attention has been given to capacity building and integration of information and its mining through enhanced use of information technology. Serious violations of provisions of the Act by persons including individuals, companies etc lead to civil as well as criminal consequences. The civil consequences include levy of taxes (including interest) and penalties and criminal consequences include prosecutions before criminal courts for offences under the Act. Besides levy of taxes on the total income of those persons whose assessments were completed during last three years and current Financial Year (up to Jan, 2017), the ITD filed prosecution complaints in 2432 cases. During the same period, 4264 compounding applications were also received from persons who had committed offences under the Act, as offences committed under the Act are compoundable. Out of the cases disposed of by the criminal courts during this period, 116 persons were convicted of the offences committed under the Act. Besides, in 3218 cases offences were compounded by the competent Income-tax authorities. Person-wise details are not maintained centrally. Further, disclosure of information in respect of specific assessees is prohibited except as provided under section 138 of the Act.
 This was stated by Shri Santosh Kumar Gangwar, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.


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Improved monitoring of implementation of Corporate Social Responsibility (CSR) policies by companies

A High Level Committee (HLC), was constituted on 3rd February, 2015 by the Ministry of Corporate Affairs under the Chairmanship of Shri Anil Baijal, former Union Secretary, to suggest measures for improved monitoring of implementation of Corporate Social Responsibility (CSR) policies by companies. The Committee had submitted its report on 22nd September, 2015. The constitution of the Committee and its report, including the recommendations, have been placed in the public domain on the Ministry’s website (www.mca.gov.in). The Committee had recommended certain changes in the provisions of the Act and Rules, in addition to recommendations for monitoring of implementation of CSR initiatives. While the Committee’s recommendations that the Board and the CSR Committee should be managing the monitoring of their own CSR at their level, and that Government should have no role to play in engaging external experts in monitoring the quality and efficiency of CSR expenditure of Companies does not envisage any specific action on the part of the Ministry, the Ministry has included amendments of Section 135 in the Companies (Amendment) Bill, 2016, issued a set of FAQs and instituted the Annual ‘National CSR Award’.
This was stated by Shri Arjun Ram Meghwal, Minister of State for Corporate Affairs in written reply to a question in Lok Sabha today.


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Benami Transactions (Prohibition) Amended Act, 2016

Though the Benami Transactions (Prohibition) Act, 1988 has been on the statute book since more than 28 years, the same could not be made operational because of certain inherent defects. With a view to providing effective regime for prohibition of benami transactions, the said Act was amended through the Benami Transactions (Prohibition) Amended Act, 2016. The amended law empowers the specified authorities to provisionally attach benami properties which can eventually be confiscated. Besides, if a person is found guilty of offence of benami transaction by the competent court, he shall be punishable with rigorous imprisonment for a term not less than one year but which may extend to 7 years and shall also be liable to fine which may extend to 25% of the fair market value of the property. 

The Benami Transactions (Prohibition) Amendment Act, 2016 came into effect from1st November, 2016. Several benami transactions have been identified since the coming into effect of the amended law. Show cause notices for provisional attachment of benami properties have been issued in 140 cases involving properties of the value of about Rs. 200 crore. Out of these, provisional attachment has already been effected in 124 cases. The benami properties attached include deposits in bank accounts and immovable properties. 

The Government has put in place empowered institutions for efficient implementation of the amended law. In exercise of powers conferred under sub-section (2) of section 28 read with section 59 of the amended Prohibition of Benami Property Transactions Act, 1988, vide Notification No. SO 3290E, dated 25.10.2016 the Central Government has notified specified Income-tax authorities to act as Initiating Officer, Approving Authority and Administrator in respect of benami transactions. Further, vide Notification No. SO 3288E, dated 25.10.2016, the Adjudicating Authority has been notified 

This was stated by Shri Santosh Kumar Gangwar, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today. 



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Profits of Banks

The details of the profit earned by the Public Sector banks (PSBs) during the financial year 2014-15 and 2015-16 are as under:
 (Amount Rs. in Crore)
Year
Profit (Loss) during the year
2014-15
37,540
2015-16
(-17,993)
Source: RBI.
 This was stated by Shri Santosh Kumar Gangwar, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha today.


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