RBI governor Urjit Patel rejects easing NPA norms
The Reserve Bank has ruled out any relaxation in bad loan rules, saying the tough norms will discipline borrowers and prevent banks from pushing distressed loans under the carpet, two senior officials, who did not want to be named, said. This message was conveyed by RBI governor Urjit Patel to parliamentarians in a closed-door meeting held in New Delhi on Tuesday. The revised rules of February 12 give banks direction on measures they should take once an account shows initial signs of weakness.
Can’t pay tax on fictional income: Flipkart to Income Tax Appellate Tribunal
Flipkart has challenged the income-tax department’s demand that it reclassify marketing expenses and discounts as capital expenditure, arguing before the Income Tax Appellate Tribunal (ITAT) that tax cannot be levied on “fictional income”. The panel was hearing Flipkart’s appeal against a Rs 110 crore tax demand for the financial year 2015-16 following the tax department’s reclassification order that could impact how other consumer internet startups, too, are taxed.
Power companies seek more time for debt resolution
Fearing Reserve Bank of India’s revised guidelines for stressed assets may force some 75,000 mw of coal-fired power projects into bankruptcy; the Association of Power Producers has requested the government to relax timelines of the new rules for the sector. A recent RBI circular stipulates that a one-day default in debt servicing would require reporting it to the central bank and implementation of a resolution plan.
CBDT proposes changes in norms for advance ruling
The Central Board of Direct Taxes (CBDT) has proposed changes in the application process for obtaining advance ruling to bring it in line with Base Erosion and Profit Shifting (BEPS) Action 5 objectives, which mandate spontaneous exchange of information on ruling with countries of immediate as well as ultimate parents of taxpayers. The proposed modified forms seek details including names, address, the country of the residence and taxpayer identification number issued by the country of residence.
Sebi amends norms for REITs, InvITs to make them more attractive
In order to make real estate investment trusts (REITs) and infrastructure investment trusts (InvITs) more attractive, the Securities and Exchange Board of India (Sebi) on Wednesday said they will have to provide a mechanism for resolution of disputes with their shareholders and partners in the holding firm.
Sebi has also amended REITs and InvITs regulations to facilitate the growth of such trusts. In separate notifications posted on its website, Sebi said: “Shareholders’ agreement or partnership agreement shall provide for an appropriate mechanism for resolution of disputes between the InvIT and the other shareholders or partners in the holdco and/or the SPV (special purpose vehicle).”
433 companies under EPFO’s scanner for possible defaults in PF management
The Employees Provident Fund Organisation (EPFO) has initiated a close scrutiny of 433 companies and establishments for possible defaults in provident fund management of their employees and asked its field offices to start a quick audit on their financial health. The 433 organizations, which run their own provident fund (PF) trusts, have been put under scanner after EPFO’s internal mechanism to track companies on PF compliance found that they have not filed PF returns of February 2018 for their employees, according to a government official and an internal circular that EPFO has issued to its field offices.
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