Banks under taxman scanner for GST refund on ATM transactions
The indirect tax department’s investigation arm is scrutinizing the GST credit availed by banks on taxes paid by their ATM vendors and could soon ask banks to cut the credit availed by them, two people with direct knowledge of the matter said. The taxmen are examining whether banks are eligible to avail 100% of Goods & Services Tax (GST) credit on services provided by vendors such as ATM withdrawal when a majority of such transactions are not charged to consumers.
Binani sale: SC won’t interfere, pushes Dalmia Bharat’s plea back to NCLAT
The Supreme Court on Thursday showed for the second time its disinclination to intervene in the Binani Cement takeover case. Although it disposed of the plea by Dalmia Bharat for overriding the National Company Law Tribunal’s (NCLT’s) order, it asked the National Company Law Appellate Tribunal (NCLAT) to expedite hearing on Dalmia Bharat’s plea without adjournment. Noting that Dalmia Bharat’s allegations were pending before the NCLAT, Justice Rohinton Nariman and Justice A M Sapre sent the case back to the NCLAT, and directed the tribunal to hear the case on a daily basis from May 22.
New governance norms: Sebi issues notification to split CMD post
The Securities and Exchange Board of India (Sebi) has asked the boards of the companies to split the post of chairman and managing director. The regulator has also asked them to have at least six independent directors, including a woman. The changes need to be put in place in phases, the Sebi said, while setting a deadline of April 1, 2019 for the independent directors. The companies will have more time to split the CMD post, for which the deadline is April 1, 2020.
Essar Steel insolvency case: Numetal moves NCLAT against CoC
Numetal on Thursday moved the National Company Law Appellate Tribunal (NCLAT) against the decision of committee of creditors (CoC) of Essar Steel that it needs to repay the existing debt of the steel firm before it is considered eligible to bid for its assets. This is the second petition filed by the company in the NCLAT since the Ahmadabad bench of the National Company Law Tribunal (NCLT) passed its order on April 19. In its first petition before the appellate tribunal, Numetal has challenged the NCLT’s April order which had directed Essar Steel’s CoC and resolution professional (RP) to reconsider the first set of bids received from Numetal and ArcelorMittal, granting an additional 30 days for the resolution process.
A welcome move by RBI on cross-border mergers
RBI has rolled out the long-awaited regulations to allow cross-border mergers that could boost foreign direct investment into the country. In March, RBI notified that the Foreign Exchange Management (Cross Border Merger) Regulations, 2018, will cover both inbound and outbound investments. The ministry of corporate affairs had already notified Section 234 of the Companies Act, 2013, paving way for the merger and amalgamation of a foreign company with an Indian company and vice-versa. Earlier, Section 234 required prior approval of RBI, but now RBI has stated that any transaction done in compliance with merger regulations will be deemed to have its prior approval.
Banks bat for ‘Swiss Challenge’ method in IBC resolution cases
In an effort to curb the crab mentality among litigious bidders to acquire stressed assets under the Insolvency and Bankruptcy Code (IBC), banks, in a proposal to the Ministry of Corporate Affairs, have suggested that bidding under the ‘Swiss Challenge Method’ be incorporated into the Code. Under the ‘Swiss Challenge’ method, the highest (H1) bid in the first round of bidding becomes the base price for bidders, including the H1 bidder, to place counter-bids in the second round of bidding.
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