Legal & Regulatory
By A&A LAW
The general law governing gambling in India is the Public Gambling Act, 1867. However, states have significant regulatory leeway with gambling laws, as the sector is listed on the “State List” under the Seventh Schedule of the Constitution of India. This explains how a state like Goa has legalized the functioning of casinos within its territory, and Sikkim permits gambling, subject to regulations by the government. States like Assam and Orissa, however, have prohibited any form of betting or gambling.
Tax Department Makes It Easier to Admit Tax Evasion
New rules notified by the Central Board of Direct Taxes (CBDT) on August 17 amends the fair market value (FMV) determination rules for immovable property, as applicable to the Income Declaration Scheme (IDS) 2016. IDS was launched on June 1, offering a four month period to enable tax evaders to disclose their undeclared income and assets. Such declarants have to pay the applicable tax, cess, and penalty (amounting to 45 percent of the undisclosed income), to gain them immunity from further penalties or prosecution proceedings under the Income Tax Act, 1961, and the Wealth Tax Act, 1957.
By Pritesh Samuel
India presents a complex economic, regulatory, and legal landscape for doing business. A company’s successful navigation of the Indian business landscape is closely linked to the risk management and mitigation strategy that that the company undertakes.
Companies must also be aware of corporate laws, which are governed by the Companies Act, 2013, as well as several others legal Acts that depend on the industry, such as The Banking Regulation Act. The Companies Act discusses laws related to mergers and acquisitions, board room decision making, party transactions, corporate social responsibility, and shareholding.
Maternity Leave to Increase to 26 Weeks for Working Women in the Organized Sector
The Maternity Benefit (Amendment) Bill, 2016 was passed in India’s upper house of parliament on August 11. It will be applicable to female workers in the formal sector, in all establishments employing 10 or more people. A notable feature of the amended Maternity Benefit Bill is the increase in maternity leave for working women from 12 weeks to 26 weeks. This leave can now be availed before eight weeks from the date of expected delivery, instead of six weeks as was the case previously. However, in case of a woman with two or more children, the maternity benefit will continue to be 12 weeks, which cannot be availed before six weeks from the date of the expected delivery.
By A&A LAW
The article discusses the extent of liabilities faced by directors and shareholders in event that a company defaults on its loans. Further, it details the manner by which a ‘wilful defaulter’ is recognized by the Reserve Bank of India (RBI).
By Tracie Frost
India recently released a new national intellectual property rights policy which seeks to enhance Prime Minister Narendra Modi’s Make in India scheme by boosting innovation. The policy, which comes at an important time for U.S.-India relations, has been widely criticized in the Indian press.
India currently ranks 37 out of 38 countries in the United States Chamber of Commerce (USCC) Global Intellectual Property Chamber Index. Based on 30 indicators spread across six categories – patents, copyrights, trademarks, trade secrets, enforcement, and international treaties – the index gives India an abysmal score of 7.05 out of 30 possible points. The greatest concern for the USCC is an Indian rule prohibiting patents for incremental changes and India’s use of compulsory licensing provisions as a means of effectuating technology transfer. Also noted as areas of concern were a series of court rulings regarding copyright infringements, deficiency of regulations for data protection, and poor enforcement of civil and criminal remedies.
Government Considers Longer Highway Contracts to Attract Investors
The government will consider extending the tenure of contract for operation and maintenance (O&M) of highways, from the current nine years to 29 years. This includes both fresh contracts and projects where the contractor is the National Highways Authority of India (NHAI). The extended stipulated period will ease recovery of costs and boost profit margins, after which the projects will be handed over to the government. Sources placed in the government state that the Union Ministry of Road Transport and Highways and NHAI are already working together to come up with more incentives to attract foreign investors to India’s infrastructure sector.
By Siddhartha Thyagarajan & Kabir Narang
The Indian government’s attempts to ease doing business currently seem one-sided. Facilitating market entry and tearing down barriers to production and trade are just one side of the coin. The other involves allowing defunct, unhealthy firms to seamlessly exit the market, where they can easily liquidate their assets.
The current financial scenario in India makes this all the more important. Most companies and major banks’ balance sheets are riddled with NPAs (Non-Performing Assets). Bad lending practices, natural disasters, and poor credit policies also contribute to the rising number of NPAs. Due to these NPAs, mostly comprising of faulty loans and overdue debt obligations, banks become starved of incoming cash flows and therefore have to compensate by charging extremely high interest rates on some products. Bank shareholders are also adversely affected. NPAs have a profound effect on the financial scenario in an economy and are often responsible for causing liquidity crunches for major financial institutions. This in turn has a destabilizing effect on the economy.