Manupatra Round Up No. 315

News

• NATIONAL

SEBI tightens listing norms for securitised paper.

The Security & Exchange Board of India has announced a standard listing agreement with monthly disclosure requirements to stock exchanges for lenders who sell their loans through the securitisation route if they wish to list their securitised instrument.

USO Fund to be made an autonomous body.

The government has approved creation of an autonomous body out of Universal Service Obligation (USO) fund worth Rs 25,000 crore, in an effort to build communication facilities in rural India.

ICAI plans code numbers to check forged attestation

The Institute of Chartered Accountants of India is planning to introduce a unique code number(UCD) to check the increasing instances of forged attestations on balance sheets, tax audit reports and other similar documents statutorily filed by the companies annually.

Mattoo case: SC commutes death sentence to life

The Supreme Court has upheld the conviction of Santosh Kumar Singh in the 14-year-old Priyadarshini Mattoo rape and murder case but it diluted the charges framed against him by the Delhi High Court and reduced death sentence to life imprisonment.

DOT to dole out subsidies for green telecom operators.

The Department of Telecom has decided to offer multiple subsidies and incentives to operators using renewable energy like solar power or biofuel to power their wireless transmission towers so as to reduce dependence on diesel & significantly bring down operating costs.

Delhi Government promulgated an ordinance to protect tourists from cheating

The Delhi Government has issued an ordinance titled "Delhi Prevention of Touting and Malpractises against Tourists" which imposes penalties upto Rs 10,000 or one year term of imprisonment or both on those found to be involved in cheating foreign travellers in the capital.

Cabinet approves judicial accountability Bill.

The Union Cabinet has approved the Judicial Standards and Accountability Bill,2010 to regulate the conduct of Supreme Court & High Court judges and bring transparency into the judicial system. Moreover, it empowers an oversight committee to investigate complaints lodged against judges.

SEBI tightens norms for PMS fee

The Security and Exchange Board of India has decided to allow portfolio managers to charge profit-sharing or performance fees from their clients only if all the losses have been recovered once the value of scheme goes down. It is based on the high-water mark principle over the life of the investment.

New city excise policy to curb liquor-related offences

According to the Delhi Excise Act 2009, the minimum age for drinking has been brought down to 21 and drinking in public places would invite a fine of Rs 5,000, a move aiming to crack down on production of spurious liquor and avoid consumption of alchohol in public places.

SC for permanent commissions for women in non-combat role

The Supreme Court has asked the government to explore the possibility of inducting serving women officers in other non-combat branches like Army Service Corp, Army Ordinance Corp, Military Engineering services etc in addition to legal and education wings.

Sensex to make its debut in Europe

The Future & Options contracts of the Sensex owned by the Bombay Stock Exchange will commence trading on the Eurex, the region's derivative leader controlled by German operator Deutsche Bourse and SIX Swiss Exchange AG.

HC - Probate Court to judge will's credibility

The Delhi High Court held that only a probate court has the competence to decide the genuineness of the will and a magistrate can't entertain such cases. Further,the High Court gave four weeks time to both the disputing parties to approach the probate court to settle their dispute.

AIMPLB moves SC & becomes party to Ayodhya title suit

The All India Muslim Personal Law Board has decided to move Supreme Court challenging Allahabad High Court verdict on disputed Ayodhya site and become a party to the case.

SC stays Sterlite's copper smelter closure till Oct 18

Sterlite Industries got a breather with the Supreme Court staying immediate closure of its copper smelting plant at Tuticorin for violating environmental norms.It had further directed the Tamil Nadu government to provide reemployment to the workers.

SC has stayed Madras HC order on closure of Sterlite Unit in Tamilnadu

Apex Court has stayed the order of Madras High Court directing closure of copper smelting plant of Sterlite in Tuticorin, Tamilnadu till next date of hearing i.e. 18th October 2010.

FMC lifts ban on sugar futures

The Commodity market regulator has decided to allow trading in sugar futures on commodity exchanges, a move that is seen as a validation that future contracts are not the prime mover of sugar prices.

SC sets aside order banning transfer of debt between banks

The Supreme Court has set aside a Gujarat High Court order that prohibited banks from transferring debts, including non-performing assets (NPA's) among each other.

Delhi High Court rejects RIL plea to quash CBI case against it

The Delhi High Court has opened gates for trial against Reliance Industries by rejecting its plea that the case filed by CBI under Official Secrets Act is time-barred, relating to seizure of classified documents from its office in 1998.

SEBI reveiws its Securities, Lending & Borrowing Framework (SLB)

The Security & Exchange Board of India has changed dividend transfer rule under SLB norms, the lenders of shares under SLB programme will now get dividend on the record date instead of the current practice of receiving it at the time of tacking back securities.

India, Bermuda ink tax evasion info agreement

India has signed a Tax Information Exchange Agreement (TIEA) with a tax haven Bermuda to facilitate exchange of information between the two countries regarding tax evasion.

ICAI plans code numbers to check forged attestation

Helpdesk set up to assist e-filing of service tax returns

The Central Board of Excise and Customs (CBEC) is setting up a new helpdesk for addressing the issues faced by Assessees while filing Service Tax returns online. The new helpdesk information should be released in one or two weeks. In the meantime Assessees finding any difficulty in using the Automation of Central Excise and Service Tax (ACES) application can seek help of the ACES service desk by sending an email to aces.servicedesk@icegate.gov.in or calling up (the) national toll-free number 1800 425 4251 on any working day from Monday to Friday between 9 AM and 7 PM. CBEC had issued Notification No. 01/2010-Service Tax, dated 19th February 2010, making e-filing of Service Tax return (ST-3) mandatory, effective from 1st April 2010 for Assessees who have paid total Service Tax of Rs. 10 lacs or more (including the amount of tax paid by utilisation of CENVAT credit) in the preceding financial year. Such Assessees would have to file the half-yearly return (ST-3), electronically under sub-rule (2) of Rule 7 of the Service Tax Rules, 1994 and deposit the Service Tax liable to be paid, electronically, through Internet banking. Even though 97 per cent of payments are electronically carried out, only 1 per cent of ST-3 returns are filed electronically. ST-3 returns are due from 1st October to 25th October. There are over 1.5 lacs registered Service Tax Assessees of which more than 80,000 are active Assessees. Most of the taxpayers face problems while filing their tax at the last minute. This practice leads to overloading of the system at the tax Authorities' end and ultimately results in technical glitches. The department concurs that there are a few technical snags and there will be teething problems till the systems mature like the excise e-filing system that is working fine now. The facility of e-filing of returns on the website (http://exciseandservicetax.nic.in), as provided in the CBEC Circular No.791/24/2004-CX. dated 1.6.2004, has been withdrawn and the Assessees are required to file their returns online or by uploading the downloadable off-line return utilities to the new ACES website (http://www.aces.gov.in).

India, Indonesia get into free-trade mode

India and Indonesia, a member country of the Association of South East Asian Nations (Asean), today operationalised a free-trade agreement signed between the two in 2009. The Central Board of Excise and Customs (CBEC) On 4th October,2010 notified amendments to the Customs Tariff (Determination of Origin of Goods) under the Preferential Trade Agreement between India and Indonesia, a member country of the Asean, effective 1st October 2010. Besides Indonesia, five other Asean members - Vietnam, Myanmar, Malaysia, Singapore and Thailand - have also ratified the FTA with India. The free-trade agreement between India and the Asean member countries slashes import duties on thousands of products like seafood, chemicals and apparel on either side. India signed the free-trade agreement on goods with the Asean in August 2009 but the agreement had to be separately ratified by each member country for the agreement to be effective.The Central Board of Excise and Customs (CBEC) on 4th October 2010 issued a notification bringing the FTA with Indonesia into force from 1 October 2010. Other Asean member countries are expected to operationalise the FTA in the coming months as the respective countries ratify the India-Asean free-trade agreement.

Cochin Shipyard pays Rs 16.87 crore dividend

Cochin Shipyard Limited (CSL) on 4th October, 2010 paid a dividend of Rs. 16.87 crore to the Centre. The dividend cheques were handed over to shipping minister GK Vasan by CSL director (operations) and officiating chairman and managing director K Subramaniam. This is the second consecutive year that the company is paying dividend to the government. It paid a dividend of Rs. 19.66 crore in 2008-09. The dividend amount is less this year as the company had redeemed preference shares amounting to Rs. 40 crore in September 2009, a release said. The yard also contributed to the national exchequer in 2009-10 by way of value-added tax, income tax, fringe benefit tax, excise duty, Customs duty and service tax amounting to Rs. 148 crore. The yard was able to increase its turnover three times from Rs. 373 crore in 2005-06 to Rs. 1,248 crore in 2009-10. During the same period, the net profit increased 12 times from Rs. 18 crore to Rs. 223 crore. CSL has delivered five offshore supply vessels to various international owners during the current year. The shipyard is also set to conclude a major contract for 20 fast patrol vessels for the Indian Coast Guard. Currently, it is constructing 15 offshore supply vessels for domestic and international owners of which four are for the Shipping Corporation of India.

Readymade Garments export to Indian market, quota to go

The Commerce Ministry started fresh negotiation with India for the removal of export quota on local readymade garments (RMG) as shipments of local apparels witnessed a fresh boost in the recent times to the neighbouring country. Under it's trade facilitation initiative, in 2008, India has allowed duty-free apparel import quota of 80 lacs pieces in a calendar year from Bangladesh. The duty-free export of 80 lacs pieces garment to the Indian market witnessed a fresh boost in the ongoing calendar year following recent progress in bilateral relations with the next door neighbors. Quota cap on garments export to the Indian market should go. Meanwhile, local RMG exporters have already utilised all the allocations of export quota for the current calendar year-2010 by July after getting tremendous response from Indian buyers. The quota allocation has finished in July this year and Bangladeshi exporters have exported 57, 25,475 pieces of garments during current year. RMG export to India is getting momentum as bilateral relation between the two neighboring countries boosted after Prime Minister Sheikh Hasina's visit to India and that might strengthen further by abolishing the existing the export quota.

Indian exports rise 22.5 percent, deficit balloons to $16.64 bn

Though Indian exports rose for the 10th consecutive month in August, growing an annual 22.5 per cent to $16.64 billion (Rs. 77,509 crore), the trade deficit widened to a huge $56.62 billion, underlining the need to increase the country's outbound sale of goods. India is targeting a 15 per cent growth in this fiscal's exports at around $200 billion, having seen a 4.7 per cent dip in 2009-10, owing to the global financial crisis. The trade deficit for April-August, 2010 was estimated at $56.62 billion which was higher than the deficit of $40.27 billion during the previous corresponding period, according to the data released by the commerce ministry. Imports during August rose 32.2 per cent at $29.67 billion (Rs. 138,211 crore), resulting in a gap of $13.04 billion between exports and imports in the month, the data showed.

Cumulative value of exports increased 28.6 per cent during 1st five months of 2010-11 at $85.27 billion compared to $66.3 billion in the same period last fiscal. Value of imports for the period April-August rose 33.1 per cent at $141.89 billion against $106.6 billion the likewise period in 2009-10. The rise in imports was driven by the increase in non-oil imports reflecting the outcome of the floods leading to an increased import of essential commodities principal. Oil imports during August stood at $7.79 billion, 12.4 per cent higher than oil imports valued at $6.93 billion in the corresponding month 2009. Non-oil imports during the month were estimated at $21.88 billion, was 41.1 per cent higher than that in August, 2009. The Federation of Indian Exporter Organisations (FIEO) attributed the continued growth in exports to the strategy of diversifying export destinations.

• INTERNATIONAL NEWS

Moscow ex-mayor not planning legal battle: report

Moscow's ex-mayor Yuri Luzhkov announced that he will not contest his high-profile sacking in court, but would stay in the political arena and push for more democracy.

"I did not take such a decision and I will not do so," Luzhkov, 74, told in his interview since President Dmitry Medvedev dismissed him after an escalating spat with the Kremlin.

Luzhkov's close friend, the famous singer Iosif Kobzon, had told last week that Luzhkov would challenge his dismissal in court.

"I do not believe that the supreme court will make a decision which would contradict with the president's decree," Luzhkov said in the extensive interview. Luzhkov, who was ousted after 18 years of power, said he wanted to forge democracy in Russia -- in an evident jab at the Kremlin.

"Going into politics means working on the establishment of the laws of a democratic society. Today our society has laws that are not democratic," and for this he would form a political movement.

Test tube Babies ‘Father’ wins Noble Prize for Medicine

Known as the "father of the test tube baby," the British scientist who developed the in vitro fertilization procedure that has led to 4 million births around the world.

Robert Edwards won the Nobel Prize in medicine for his work, which began in the 1950s, withstood criticism and ethical concerns, and ultimately helped so many infertile couples become parents.

British physiologist Robert Edwards, here in 2008, developed in vitro fertilization and gave thousands of infertile couples the chance to have children."His achievements have made it possible to treat infertility, a medical condition afflicting a large proportion of humanity including more than 10 percent of all couples worldwide," the prize committee said.. He developed the IVF therapy with British gynecologist Patrick Steptoe, who died in 1988 and therefore could not share the $1.5 million prize.

Their work, which involves mixing eggs and sperm outside the body and returning an embryo to the womb for development, led to the birth of the world's first test tube baby on July 25, 1978, when Louise Brown was born in Britain.

Martin Johnson, a University of Cambridge professor of reproductive sciences, told Agence France-Presse that Edwards' prize "was far overdue."

"I'm surprised it was so late," he said, telling AFP that Edwards "brought obstetrics and gynecology into the modern age."

Nobel physics prize for ultrathin carbon discovery

Two Russian-born scientists shared the Nobel Prize in physics for "groundbreaking experiments" with the thinnest, strongest material known to mankind — a carbon vital for the creation of faster computers and transparent touch screens.

Andre Geim and Konstantin Novoselov, professors at the University of Manchester in Britain, in 2004 isolated graphene, a form of carbon only one atom thick but more than 100 times stronger than steel, and showed it has exceptional properties, the Royal Swedish Academy of Sciences said.

Experiments with graphene could lead to the development of new superstrong materials to make satellites, airplanes and cars, as well as innovative electronics, the academy said in announcing the 10 million kronor ($1.5 million) award.

"Graphene transistors are predicted to be substantially faster than today's silicon transistors and result in more efficient computers," the academy said in the citation. "Since it is practically transparent and a good conductor, graphene is suitable for producing transparent touch screens, light panels and maybe even solar cells."

Geim, 51, is a Dutch national while Novoselov, 36, holds British and Russian citizenship. Both are natives of Russia and started their careers in physics there. They first worked together in the Netherlands before moving to Britain.

Novoselov is among the youngest winners of a prize that normally goes to scientists with decades of experience. The youngest Nobel laureate to date is Lawrence Bragg, who was 25 when he shared the physics award with his father William Bragg in 1915.

Geim told The Associated Press he didn't expect to win the prize this year and had forgotten that it was Nobel time when the prize committee called him from Stockholm.

The two scientists used simple Scotch tape as a crucial tool in their experiments, peeling off thin flakes of graphene from a lager piece of graphite, Geim said.

"Graphene is the thinnest material in the world, it's one of the strongest, maybe the strongest material in the world. It's an excellent conductor. Electrons move through it very quickly, which is something you want to make circuits out of," Schewe said.

He said graphene may be a good material for making integrated circuits, small chips with millions of transistors that are the backbone of all modern telecommunications. Its properties could also lead to potential uses in construction material, Schewe said, but added it would take a while "before this sort of technology moves into mainstream application."

Nonprofit Group Wins Pepsi Contest

A nonprofit group that complained that Pepsi had allowed organizations with political agendas to participate in its online giving contest, Pepsi Refresh, won one of the two $250,000 prizes. The group, Arms Wide Open Childhood Cancer Foundation, raises money for alternative therapies and treatments for children with neuroblastoma. The group contended that 16 contestant-groups that were members of the Progressive Slate were political groups tied to the Democratic party and thus violated contest rules. Pepsi disagreed, saying the groups were not advocating for a particular candidate or issue. Eight of those groups won $50,000 prizes.

Georgia death row inmate denied high court review

Troubling questions over Georgia's controversial death penalty system will remain unresolved for now, after the Supreme Court declined to review an appeal from a death-row inmate who received unwanted help from state prosecutors on his legal representation.

The justices without comment rejected Jamie Ryan Weis' request for relief. He says he sat in jail for years after the state ran out of money to pay for his lawyers. Weis said prosecutors then suggested that a judge appoint two public defenders, even offering the names of two overworked and inexperienced attorneys who did not want the job. Weis' current legal team calls that a blatant conflict of interest.

At issue is whether Weis' constitutional right to a speedy trial and competent defense were short-circuited by an ongoing budget shortfall. Dozens of other inmates who lack financial resources to afford their own attorneys have made similar accusations.

The Georgia Supreme Court concluded the indigent defense system was functioning adequately, if not perfectly. The state justices also said Weis was partly to blame for the delays because of his unwillingness to work with his legal team, and should have accepted the public defenders. The state has said he was never without legal representation.

Weis was convicted in the 2006 murder of Catherine King during a robbery. Two private attorneys were originally named to represent him, but a lack of funding forced a judge to instead appoint the two public defenders. The new legal defense team later tried three times to withdraw, citing a bursting caseload, a lack of experience handing a capital case, and a lack of money to hire investigators to prove Weis' claimed innocence.

His current lawyers, from the Southern Center for Human Rights, say Weis has suffered greatly behind bars because of the long appeal process. He has reportedly tried to commit suicide three times.

Georgia revised its system by creating a taxpayer-funded public defender system in 2003, and an office to deal just with death penalty cases, which generally undergo greater judicial scrutiny and take longer to work their way through the courts.

But problems in the program popped up almost instantly, exacerbated by the high-profile prosecution of Brian Nichols, who was convicted of escaping from a prison cell and killing a judge and three others in an Atlanta courthouse in 2005. That case ate up $3 million in state funds, nearly draining the new office's budget.

Another $30 million raised from court fees and fines was diverted by the state legislature to a general fund, creating more budget uncertainty for the defender office.

The U.S. Supreme Court in recent years has taken a close look at Georgia's capital punishment procedures. Now-retired Justice John Paul Stevens in 2008 slammed the state's high court for an "utterly perfunctory" review of a death penalty case.

The justices last year also ordered a federal court to review whether Troy Davis received a fair hearing. He was convicted of murdering a Savannah police officer in 1989, but has earned high-profile support from those who claim the state has repeatedly refused to examine new evidence showing he may be innocent of the crime.

State and federal courts have repeatedly rejected his claims. That case could again be back on the Supreme Court's radar in coming months.

Sri Lanka car imports on rise

Car imports to Sri Lanka have risen sharply during the last three months.Sudharma Karunaratne, director general of Customs told reporters that some 450 to 500 vehicles are being customs cleared daily. Used cars from Japan dominates the island's market. The car import trade had ground to a halt with the government slapping high customs duty on cars since 2008. In October 2009, only 370 vehicles were customs cleared, representing a sharp drop of 54 per cent compared with October 2008. However, the tariffs were drastically brought down in June 2010, a move to invigorate growth in the island in its post-ethnic separatist conflict revival. The lowered tariffs have doubled the state revenue from import duties. Lowered tariffs and expanded tax base were main economic revival steps recommended by the International Monetary Fund when it approved the 2.6-billion-U.S. dollar stand-by loan to the island to boost up its foreign reserves. Sri Lanka anticipates 8 per cent growth in the current year to carry out its massive reconstruction and rehabilitation effort in the post conflict era.

Canada waives import taxes on some ships

Jim Flaherty, Canada's Minister of Finance, has announced a waiver of Canada's 25 per cent import tariff on imports of all general cargo vessels and tankers, as well as ferries longer than 129 meters. Remitting the 25 per cent tariff is expected to save shipowners $25 million per year over the next decade. Under the Customs Tariff imported ships are subject to a tariff rate of 25 per cent, the highest rate of duty for industrial goods. To complement the new duty remission framework, decisions have been made on all outstanding duty remission requests that were in the Canadian Government's in-tray. As part of those decisions, the Government is remitting the $15.3 million in customs duties paid on two tankers, the Algonova and the AlgoCanada, imported from Turkey by Algoma Central Corporation in 2008 and 2009. It is also remitting $119.4 million in customs duties paid on four large-sized ferries, the Coastal Renaissance, the Coastal Inspiration, the Coastal Celebration and the Northern Adventure, imported by the British Columbia Ferry Services Inc. (BC Ferries) between 2007 and 2009 from Germany Duty remission will support the competitiveness of Algoma Central Corporation's downstream users, primarily producers and users of energy products, who should benefit from lower shipping rates as a result of this measure. Duty remission will also be of benefit to BC Ferries and to its users.

Germany and Switzerland commit EUR2.1 Million to support Ghana’s tax reform

Switzerland and Ghana signed a memorandum of understanding (MOU), pledging EUR2.1 million to support Ghana’s tax policy and administration. This brings the total amount contributed by the two countries to EUR9 million. The MOU was made between by Ghana’s Finance Ministry, the German Agency for Technical Co-operation (GTZ) and the Swiss State Secretariat of Economic Affairs (SECO). It is the second phase of the program of co-operation between the countries. The document was signed by Deputy Finance Minister, Fiifi Kwetey, Dr Fred Brandl, Country Director of GTZ, and Jean-Luc Bernasconi, Head of Operations at SECO. The money will be used to enable Ghana’s Revenue Authority to integrate its Internal Revenue Service, VAT Service and Customs, Excise and Preventative Service under one authority, boost revenue collection and improve service. The Tax Policy Unit (TPU) will be united with the Finance Ministry and officers’ capacity to make informed decisions on tax policy will be developed. Kwetey emphasized that Ghana had to develop internally-generated sources of revenue despite the prospect of revenue from oil. The focus for the country now is to widen the tax base and broaden the tax net as well as boosting the business climate and improving tax collection.