SEBI SLAPS RS 2 CRORE FINE FOR FRONT RUNNING CASES IN HDFC AMC ON 4 ENTI...

SEBI’s Adjudication Order in respect of Nilesh
Kapadia, Dharmesh Shah, Ashok Nayak and IKAB Securities and Investment Ltd. in
the matter of Front-running the trades of HDFC AMC

The regulator levied a fine of Rs 50 lakh each
on Nilesh Kapadia and Dharmesh Shah, Rs 40 lakh on Ashok Nayak and Rs 60 lakh
on IKAB Securities and Investments Ltd.

Sebi on Thursday imposed a penalty totalling Rs
2 crore on four entities in HDFC Asset Management Company (AMC) front-running
case.

In November 2019, the regulator had levied a
fine of Rs 25 lakh on Kapadia for misusing his position in the capacity of HDFC
AMC dealer.

What is Front-Running ?

Front-running refers to an unethical practice
by someone trading in shares on the basis of advance information given by a broker,
analyst or other executive at a market intermediary before the trades are
conducted by that entity.

Front-running is when a broker or other entity
enters into a trade because they have foreknowledge of a big non-publicized
transaction that will influence the price of the asset, resulting in a likely
financial gain for the broker. It also occurs when a broker or analyst buys or
sells shares for their account ahead of their firm's buy or sell recommendation
to clients.

Front-running is also known as tailgating.
Front-running is illegal and unethical because it takes advantage of private
information that is not available to the public. If a big transaction is made
public, then buy or selling ahead of it is not illegal.

How it Woked in HDFC AMC Trades?

During the investigation period of October 2006
to June 2007, Kapadia, who was equity dealer with HDFC AMC between June 2000 to
2010, tipped Dharmesh Shah regarding impending HDFC AMC trades, Sebi noted.

Dharmesh Shah in turn facilitated 109 instances
of front-running the trades of HDFC AMC.

These front-running trades were executed in
trading accounts of Nayak and Bankim Shah, one of the dealer of IKAB Securities
and Investments, among others.

Distortion of Market

SEBI further said that the four entities
actually "distorted the market for the said shares, by causing
premeditated non-genuine trades to take place with profits for the traders (at
the cost of HDFC Mutual Fund and its investors as well as ordinary general
investors) which were nearly guaranteed on account of confidential information
selectively available to them."

Violations of PFUTP Provisions

By indulging in such activities, the entities
violated the provisions of PFUTP (Prohibition of Fraudulent and Unfair Trade
Practices) norms and accordingly, the regulator levied fine on them.

LATEST GST NOTITIFICATION 60 & 61 /2020
Dated 30-07-2020 AND AMENDMENT

“FORM GST INV – 1

(See Rule 48)

Format/Schema for e-Invoice

In the Central Goods and Services Tax Rules,
2017, for FORM GST INV-01, the following

form shall be substituted, namely:-

“FORM GST INV – 1

(See Rule 48)

Format/Schema for e-Invoice

================================

Central Board of Indirect Taxes and Customs

Notification No. 61/2020 – Central Tax

New Delhi, the 30th July, 2020

G.S.R.....(E).—In exercise of the powers
conferred by sub-rule (4) of rule 48 of the Central

Goods and Services Tax Rules, 2017, the
Government, on the recommendations of the Council,hereby makes the following
amendments

In the said notification, in the first
paragraph,

(i) before the words “those referred to in
sub-rules”, the words “a Special Economic Zone unit and” shall be inserted;

(ii) for the words “one hundred crore rupees”,
the words “five hundred crore rupees” shall be substituted

Why Pas-6 is compulsory to be filed by Pas-6 for Unlisted Public Companies?

Why Pas-6 is compulsory to be filed by Pas-6 for Unlisted
Public Companies?

The Reconciliation of Share Capital means to match the
records of the dematerialized and physically held securities with all the
securities, on orderly basis. In normal parlance, it is reconciliation of the
total Share Capital of the Company held in D-MAT form with the NSDL & CDSL
and in physical form by the shareholders of the Company with the total Capital
introduced, issued and listed capital, if any.

What is Reconciliation
of Share Capital Audit ?

“Reconciliation of Share Capital Audit Report” means a kind
of Audit report issued to Company’s Auditor for auditing the reconciliation of
total Share Capital of the Company held in the D-MAT form with NSDL & CDSL
and also in physical form by the shareholders of the Company with the total
capital introduced, issued and listed, if any.

FOR
LISTED COMPANIES

Originally the “Reconciliation of share Capital Audit
Report”, was made applicable for only those companies which were listed on the
Stock Exchange as per regulation 55A of SEBI (DEPOSITORIES AND PARTICIPANTS)
REGULATIONS,1961 Subsequently, with this the Companies which were listed were
required to file the same on the quarterly basis.

NOW IT IS COMPULSORY
FOR THE UNLISTED PUBLIC COMPANIES TO SECURE AN ISIN

Ever since, the Ministry of Corporate Affairs (MCA), has made
it compulsory for the unlisted public companies to secure an ISIN
(International security Identification Number) and also to smooth the process
by converting their existing securities in the dematerialized form within a
specified period of time and thereby issuing fresh securities only in
dematerialized form.

Form PAS-6
Reconciliation of Share Capital Audit Report for public unlisted companies

Objective –

·   
Reconciliation
of Share Capital Audit Report on half yearly basis.

·   
Objective
behind Form PAS-6 is to file with the Registrar of Companies, an audited report
of the Reconciliation of Share Capital of a Company

Provisions:

Pursuant to Rule 9A of Companies (Prospectus and Allotment of
Securities) Rules, 2014 as amended vide Companies (Prospectus and Allotment of
Securities) Third Amendment Rules, 2019

Applicability:

1. Public Unlisted Company

2. Deemed Public Company

Non-Applicability

(a) a Nidhi;

(b) a Government company or

(c) a wholly owned subsidiary

Dematerialised
Form

Rule 9 A Issue of securities in
dematerialised form by unlisted public companies provide the following

1. Issue and Demat of existing securities:

These companies in which rule are
apply, it is mandatory to issue their securities in dematerialized form on or
after October 02, 2018 and facilitate the dematerialisation of its existing
securities in accordance with Depositories Act, 1996.

Promoters, Directors and KMP
Shareholding Should be Dematerialized

Before making any offer of securities
or buyback or bonus issue or right issue , Entire holding of Following class of
person (Promoters, Directors and KMP) 
has been dematerialized

Applicability
of Form PAS-6:

1. Unlisted Public Companies.

2. PAS 6: Applicable with effect from July 15, 2020.

3. Form PAS-6 is a half yearly audit report on reconciliation
of share capital which is to be signed by a Practicing Company Secretary /
Chartered Accountant.

4. All information shall be furnished within 60 days from the
end of each half year   (30th
September/31st March) for each ISIN separately.

What
Details have to be filled in the Form PAS-6:

·   
ISIN(International
Securities Identification Number)

·   
Period
for which return is filling.

·   
Details
of capital of the Company.

S.No	Particulars	No. of Shares	Percentage of Total issued Capital
a	Issued Capital
b	Held in Demarialised Form in CSDL
c	Held in Demarialised Form in NSDL
d	Held in Physical Form
e	Total No. of Share (b)+(c)+(d)

Reasons for difference if any in (a) and (e)

-Details of changes in
Share Capital during the half –year under due to any:

1. Right Issue

2. Bonus Issue

3. Private Placement

4. ESOPs

5. Amalgamation

6. Conversion

7. Buy Back

8. Capital Reduction

9. Forfeiture

10. Or any other

Details of No. of Shares and the fact whether intimated to
NSDL/CDSL shall also be mentioned in the form PAS-6.

·    Proper details or shares held by
Promoters, Directors and KMP.

·    Particulars about register of
members, whether updated or not.

·    Particulars of total no. of demat
request, if any, confirmed within 21 days.

·    Particulars of total no. of demat
request,if any pending beyond 21 day with proper reasons of delay.

·    Particulars of Company Secretary of
the Company, if any.

·    Particulars of the practicing
Professional who is certifying the form.

*Note- All information shall ire furnished for the half year
ended 30th September and 31st March in every financial year for each ISIN
separately

Due Dates for Filing Pas-6

The due date of filing pas-6 is within 60 days of the
conclusion of each half-year ending on the 31st of March or 30th September of
every year, as the case may be.

The half year ending time limit for filing is as follows: –

31st March of every Year: – 60 days from the date of
conclusion of 31st March of every year

30th September of every Year: – 60 days from the date of
conclusion of 30th September of every year

Conclusion

The FORM PAS-6 enables us to the report the Audit of
Reconciliation of Share Capital of an Unlisted Pubic Company except the
exempted unlisted public companies and the Companies which are specifically
exempted. Due care is to be taken while filing this form as it requires the
detailed information of Securities of Issuer Company and also involves the
third parties like NSDL and/or CDSL.

Effective 30th September, 2019, every Unlisted Public Company
will be required to submit Reconciliation of Share Capital Audit Report
(Half-yearly) in Form PAS-6

Will there be any further extension for filing FLA-2020 with RBI? Extens...

RBI extended the due date for filing FLA from 15 July 2020 to
31 July 2020.

RBI extended the due date for filing FLA return for 2019-20
to July 31 from July 15, 2020; States that the extension comes in the wake of
the recent change in reporting platform for submission of the return.

RBI FLA is down for almost 4 to 5 days during 9am to 6pm...
extension is possible whoever facing the issue can request for extension by
email with screens hot of issue

Message from FLA Team

We are aware of the inconvenience faced by stakeholders while
filing FLA return. We are in the process of resolving the issue and will be
informing you once resolved.

The due date tor submission of FLA for the year 2019 -2020 is
being extended. The same would be displayed on the FLAIR home page once the
site becomes operational .

FLA Team

-----------------------------------------------------------------

EXTENSION OF DUE DATES FOR TDS/TCS
RELATED COMPLIANCES

Compliance	Original Due Date	New due dates notified on 24-06-2020
	Filing of TDS/TCS Statement
Form 24Q, 26Q, 27Q and 27EQ of Q4 of FY 2019-20	31-05-2020	31-07-2020
Form 24Q, 24Q, 26Q, 27Q and 27EQ of Q1 and Q2 of FY 2020-21	As per Rule 31A/31AA	31-03-2021
Form 26QB, 26QC and 26QD of February, 2020	30-03-2020	31-07-2020
Form 26QB, 26QC and 26QD of March, 2020	30-04-2020	31-07-2020
Form 26QB, 26QC and 26QD of April to November, 2020	30 days from end of month in which tax is deducted	31-03-2021
	Issue of TDS/TCS certificate
Form 16 for TDS on salary during FY 2019-20	15-06-2020	15-08-2020
Form 16A for TDS on income other than salary for Q4 of FY 2019-20	15-06-2020	15-08-2020
TCS certificate for Q4 of FY 2019- 20	30-05-2020	15-08-2020

MANY NCLAT’S VERDICTS WERE OVERTURNED BY SUPREME COURT IN 2019- LANDMARK...

MANY NCLAT’S VERDICTS WERE OVERTURNED BY SUPREME
COURT IN 2019- LANDMARK VERDICTS BY SC UNDER IBC  PROVISIONS https://youtu.be/uZODq2nB5Ww

To see my latest videos , please subscribe my
YouTube channel https://www.youtube.com/c/RVSeckar?sub_confirmation=1

Though the National Company Law Appellate Tribunal (NCLAT) passed several
orders/judgments in the insolvency and corporate matters in 2019 which include
Tata-Mistry feud, Essar Steel ,Jet Airways ,IL&FS, Jaypee Infratech, and
Reliance Communications Cases, several of them failed to pass the scrutiny of
the Supreme Court and were either set aside or modified.

Many Important Cases have to be decided by NCALT during 2020 such as Registrar
of Companies (RoC) plea to modify the order passed by it in the Tata-Mistry
case, in which it had directed to change the status of Tata Sons from a private
company to a public company, the holding firm of USD 110 billion empire

Recently , NCLAT has uphold the supremacy of Section 32A of IBC IN Bhushan
Power & Steel Ltd in which JSW has challenged attachment of assets by the
ED and NCLAT ordered re-attachment of Bhushan Power assets in 2020.

NCLAT has to decide in resolution of IL&FS group which has an
outstanding debt of over Rs 90,000 crore in 2020 and in McDonald's-Bakshi
matter, where state-run HUDCO is opposing settlement offer by US-based QSR
major

Cases in which NCLAT orders have been reviewed by Supreme Court in 2019.

Essar Steel insolvency matter	NCALT put all the operational creditors of the company almost at par with the secured financial creditors over the disbursement of funds. NCLAT altered  resolution plan voted by Essar Steel's lenders and approved by NCLT Ahmedabad and was challenged before the Supreme Court.	The apex court on November 15 2019, not only upheld the primacy of financial creditors in the distribution of funds received under the corporate insolvency scheme but also ruled that the CoC would have a final say in the resolution plans under the Insolvency and Bankruptcy Code (IBC)
Amtek Auto	In August 2019, the NCLAT ordered for liquidation of auto component maker Amtek Auto declining its lenders plea for extension of the insolvency resolution process deadline.	SC stayed the order of NCLAT and directed the resolution professional to invite fresh bids for the auto component maker within 30 days
Dhanuka Laboratories for Orchid Pharma	NCLAT in November 2019 rejected the bid of Dhanuka Laboratories for Orchid Pharma and set aside the approval granted by the Chennai-bench of the NCLT. The NCLAT observed that the approved resolution value, which stood at Rs 1,146.04 crore, proposed by Dhanuka Laboratories was lower than the liquidation value of Rs 1,309 crore of the company.	This was challenged by the CoC before the Supreme Court which granted a stay on the order December 2019.
Jaypee Infratech	In July 2020, the NCLAT permitted fresh bidding for the debt-laden Jaypee Infratech and extended the resolution period for another 90 days.	However, in November 2019 ,the apex court annulled the order and allowed only two revised resolution plans from NBCC (India) Ltd and Suraksha Realty for voting.The apex court had directed to complete the resolution process of Jaypee Infratech in 90 days.
La-Fin Financial Services	The NCLAT order of January l2019 directing initiation of insolvency proceedings against investment firm La-Fin Financial Services over the plea of IL&FS Financial Services had similar outcome at the apex court.	The order was set aside by the Supreme Court which held that IL&FS Financial Services plea was beyond the period of three-years mentioned in Article 137 of the Limitation Act, and thus is time-barred and cannot be proceeded further.

Sterling Biotech

In 2019, some of the NCLAT orders also raised eyebrows. The order in case of
Sterling Biotech was such a case. The appellate tribunal not only stayed the
liquidation of the company but also directed to hand over the management to its
promoters, including absconding Nitin Jayantilal Sandesara and Chetankumar
Jayantilal Sandesara.

The NCLAT also said that the Enforcement Directorate will probe and
ascertain whether the money paid by the absconding promoters is not from the
proceeds of crime.

NCLAT sets aside CAIT plea against CCI nod to Flipkart's acquisition by
Walmart

A two-member bench of the appellate tribunal said CAIT failed to establish
its allegations against CCI granting approval for Walmart-Flipkart deal. NCLAT
also said Flipkart was not even made party by CAIT in its plea. "We find
no merit in it, accordingly the appeal is dismissed," said NCLAT,
upholding the CCI nod to the deal.

CONCLUSIONS

·     SC upheld the primacy of financial creditors in
the distribution of funds .SC
held that CoC would have a final say in the resolution plans under the
Insolvency and Bankruptcy Code (IBC) where NCLAT treated both Financial
and operational creditors alike.

·     SC granted extension of the insolvency
resolution process deadline which was refused by NCLAT.

·     SC held that IL&FS Financial Services plea
was beyond the period of three-years mentioned in Article 137 of the Limitation
Act, and thus is time-barred and cannot be proceeded further.

·     NCLAT permitted fresh bidding for the
debt-laden Jaypee Infratech and extended the resolution period for another 90
days and the apex court annulled the order and allowed only two revised
resolution plans.