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Powering #compliance softwares #Komplify & #Komrisk.Follow for regular #compliance #litigation updates on #labour #tax & other laws;
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Companies to transfer shares to the newly created Special Demat Account of the IEPF Authority

The Ministry of Corporate Affairs (“MCA”) has recently issued a circular relating to transfer of shares to the Investor Education and Protection Fund Authority(“Authority”).

It has been informed through the circular that the Authority has decided to open a Special Demat Account with the National Securities Depository Limited (NSDL) through a Depository Participant of NSDL. This Special Demat Account will have features and functionality to support IEPF operations using paperless, digital processes and facilitate record keeping of shares transferred to the Authority. The details of the Demat Account will be issued in due course.

Therefore, the Circular has directed all companies to do the following :

1. Transfer such shares which are required to be transfer shares to the IEPF Authority under the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, to the Special Demat Account.

2. Provide the information related to the shareholders whose shares are being transferred to the IEPF’s demat account, to NSDL.

[Note:
i. The NSDL will prescribe file formats and operational procedures for transfer of shares to Special Demat Account of the IEPF Authority by 20th April, 2017 and 15th May, 2017 respectively.

ii. The charges to be levied by NSDL to the companies towards upload and maintenance of records relating to shares transferred to the Special Demat Account of the IEPF are as follows:

a. Transaction fee at the time of effecting shares to Demat Account: Rs. 10/- per record subject to minimum of Rs.500/-.

b. Annual Maintenance Fees: Rs.11/- per record subject to minimum based on paid-up capital of the company as mentioned in the page 2 of the link:http://www.mca.gov.in/Ministry/pdf/Circular_27042017.pdf ].



Source: Ministry of Corporate Affairs

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MCA issues clarification regarding online generation of challans for offline payment cases.

The Ministry of Corporate Affairs (“MCA”) has issued a Circular dated 20th April, 2017 relating to the online generation of challans for offline payment cases.

As you may be aware that under the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (“Rules”) companies are required to transfer the amounts to the Investor Education and Protection Fund (“Fund”) through challans generated on MCA 21 portal. However, it had been observed that companies which have transferred amount to the Fund prior to 15th December, 2016, were not being able to generate challans on MCA 21 portal.

Therefore, the MCA has clarified the following relating to challan generation:

Companies which are required to transfer amount to the Fund through Challans generated on MCA 21 portal but could not do so are required to submit the details of such challans in the specified format [titled “Annexure”, attached for your reference ] to the IEPF Authority on email id “challan.iepfa@mca.gov.in “. The details of the challan must be submitted to IEPF Authority by 20th May, 2017.
The copy of the challans (mentioned in the above point 11.) and certificate for authentication of the details submitted are required to be obtained from practicing professionals’ i.e. Chartered Accountants, Company Secretaries and Cost Accountants.
The submitted data will be processed by the IEPF Authority and a Front Office service will be made available on IEPF website from 5th June, 2017 for a period of 30 days upto 5th July, 2017.
An automated generated number will be provided by the MCA 21 system on validation of entries and using this automated generated number as SRN.

Source: Ministry of Corporate Affairs.

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Tamil Nadu, Department of Labour and Employment issues guidelines for employing women during night shifts in factories

The Labour and Employment Department, Tamil Nadu (“Department”) has issued amendments to the Tamil Nadu Factories Rules, 1950 on 26th April, 2017. By virtue of the amendment, guidelines have been prescribed for employing women during night shifts in factories.

The amendment has inserted a new provision, Rule 84 in the Tamil Nadu Factories Rules, 1950 with immediate effect.

Key highlights of the amendment are:

1.The occupier of a factory is now required to take steps to prevent the commission of the acts of sexual harassment in the factory;

The occupier of a factory must constitute a complaint committee to maintain a complaint mechanism in the factory itself and to dispose of the complaints in time bound manner with strict confidentiality. The complaint committee must be headed by a woman familiar with the issues of sexual harassment and not less than half of its members should be women besides a non-governmental organisation’s representation;
The women workers will be allowed to raise the issue of sexual harassment in the workers’ meeting;
The occupier of a factory has to assist the women workers affected by sexual harassment;
The occupier of a factory must provide proper lighting in and around the factory;
The occupier of a factory must ensure that women workers employed in night shift are not less than ten and not less than two third of the total strength of workers and one third of the Supervisors / Shift Incharge / Foremen should be women; as well;
The occupier of a factory should provide sufficient women security at the entry and exit points and sufficient work sheds for the women workers be employed in night shift;
The occupier of a factory has to provide separate dining facility and separate safe transportation from the factory premises to the nearest point of their residence to the women workers in night shift;
The occupier of a factory should provide necessary medical facilities and also make these facilities available at any time of urgency in case of injury or incidental acts of harassment, by providing necessary telephone connections;
The occupier of a factory should ensure that wherever the factory provides boarding and lodging for women workers, the same shall be kept exclusively for women and it should be under the control of women wardens or supervisors;
The occupier of a factory should ensure that there shall not be less than twelve consecutive hours of rest between the last shift and the night shift whenever a woman worker is changed from day shift to night shift and from night shift to day shift;
The occupier of a factory should appoint not less than two women workers per night shift who shall go round and work as Special Welfare Assistants;
Whenever there is any untoward incident, the occupier of a factory should send a report to the Inspector and Police Station concerned as well;
The occupier of a factory must exhibit these guidelines in a prominent place so that the women workers can be aware of their rights;
Adequate toilet with water facility, should be provided to the women workers, conveniently situated and easily accessible containing all basic amenities and safety measures to the workers;
Creche facility wherever needed, should be provided to the women workers for the care of their children with care taker with all essential amenities.

Source: Tamil Nadu Gazette

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Revision of Minimum Rates of Wages for 39 different Industries/ Employments in the state of Jammu and Kashmir

The Labour and Employment Department, Civil Secretariat, Jammu has issued a Notification bearing No. SRO 73 dated 23rd February, 2017, thereby proposing to revise the minimum rates of wages for the class of workmen/ employees in 39 different Industries/ Employments like shops and establishments, construction industry, light engineering work, workshops etc in the State of Jammu and Kashmir.

The revised rates of wages has not yet been notified by the Government of Jammu and Kashmir. These rates shall be effective from the day of its notification.

The proposed rates of minimum wages has been attached for your due reference.

Source: Labour and Employment Department, Jammu and Kashmir

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How are compliance management systems making regulatory compliance easier to track for MSMEs.

MSMEs form a significant part of India’s industrial sector, given that they contribute 38% to the country’s GDP. Collectively, they produce more than 6000 products which range from traditional to sophisticated tech items. The government has been trying to boost this sector with its various policies such as Make in India and the recent tax sops offered to them in Budget 2017. In particular, the Make in India program has made it mandatory for foreign companies to source 30% of their materials from local firms, in order to put them on the global manufacturing map.

In order to break into the global supply chain, it is important for MSMEs to have their compliances covered. Conglomerates are more inclined to do business with firms that fulfil their compliance requirements as it would reduce their liability in case of slip ups. Moreover, compliant firms are more likely to attract funds from venture capitalists and can follow a fast-tracked path to growth. Despite the benefits that being compliant has to offer, that only around 65% of companies in India are fully compliant with all norms.

The main roadblock to compliance in India is its complex three tiered structure. Irrespective of where a unit is based, it would have to comply with local, state and central laws which can be quite overwhelming to deal with. The maze-like structure of compliance requires a lot of time, manpower and money be spent on it, something that most MSMEs lack. The costs involved deter MSMEs from bothering with regulatory compliance too much, which leads to payment of huge sums in bribes and penalties upon surprise inspections.

Compliance management systems are simple solution to mitigate a lot of compliance related issues faced by MSMEs. They take care of not only the critical compliances but also provide alerts on due dates. They can be implemented throughout the organization and changes to any law or rules shall be reflected in them, helping MSMEs keep abreast of their compliance requirements. Komplify has been tailor made for MSMEs, keeping in mind their needs.

It is a simple, cloud based tool that aids MSMEs in India keep track of their critical and other legal compliances. It provides calendar alerts on compliances due and any changes in compliances that are applicable to a subscriber are reflected almost instantaneously. Komplify provides slice and dice reports as well as customized reports which provide a subscriber with detailed information on the compliances completed and the ones which are pending. The Komplify repository includes all compliances that are applicable across Indian states and UTs both central and state level laws, which are regularly updated It is also immensely helpful for entities with multiple units spread across the length and breadth of the country, as the software can integrate all compliances required based on their geographical location.

Compliance management systems are a good solution for MSMEs to track their regulatory compliances as they are quite inexpensive and dispense with the need to spend much time and man power on them. They are much popular globally and Indian MSMEs are rapidly warming up to them.

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Legal rights of Woman @ Workplace

Over the past few years, the Government has been undertaking several initiatives to create an ecosystem which provides equal opportunities for women to work, assures them safety and security at the workplace and has taken steps to foster an environment to work with dignity and respect.

With a view to achieve this, existing legislations affecting / relating to women has been amended to harmonize them with our constitutional ideals of ensuring that women are not discriminated on the ground of sex, secure equal pay for equal work and to provide just and humane conditions of work and maternity relief for women.

The highlights given below speak of such changes which have been instrumental in addressing key challenges such as inequality, gender bias, discriminatory treatment, safety and security concerns etc. against women at work.

Next Section

Other Sections :

Towards encouraging woman’s participation in the workforce

Towards ensuring woman’s safety and security at the workplace

Towards striking a good work-life balance

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Maternity Benefit (Amendment Act) , 2017 receives Presidential assent

In a Corrigendum issued by the Ministry of Labour and Employment (“Ministry”) on 3rd April, 2017, the Ministry has rectified the earlier notification S.O. 1026(E) dated 31st March, 2017(reported in the trail mail) stating that Section 4 (1) of the Maternity Benefit (Amendment) Act, 2017 (“Amendment Act”) will come into effect from 1st July,2017 and not the provision w.r.t the option to work from home [Section 3(5)].

Section 4(1) of the (“Amendment Act”) reads as follows:

(1) Every establishment having fifty or more employees shall have the facility of créche within such distance as may be prescribed, either separately or along with common facilities:

Provided that the employer shall allow four visits a day to the creche by the woman, which shall also include the interval for rest allowed to her.”

Hence, the option to work from home [Section 3(5)] is effective since 1st April, 2017. The requirement to have the crèche facility will be effective from 1st July, 2017.



Background:

The Indian Labour Conference (“ILC”) in its 44th, 45th and 46th Session had recommended enhancing the maternity leave under the Act from existing 12 weeks to 24 weeks. The Ministry of Women and Child Development and other stakeholders had also insisted in enhancing the maternity benefit under the Act.

Basis the recommendations of the ILC and in the wake of several requests from stakeholders, the Rajya Sabha and the Lok Sabha had passed the Bill.

The Lok Sabha has passed the Maternity Benefit (Amendment) Bill, 2016 on 9th March, 2017. The Bill had already been passed by the Rajya Sabha during the Winter Session on 11th August, 2016. With this, the Bill stands passed in the Parliament.

Highlights of the Amendment Act:

Increase in the duration of maternity leave to 26 weeks:
The Amendment Bill increases the maternity leave benefit to a period of 26 weeks. The maternity benefit should not be availed before eight weeks from the date of expected delivery.

Prior to this, woman were entitled to maternity leave benefit of 12 weeks only of which not more than six weeks should precede the date of her expected delivery.

Maternity leave of 12 weeks for mother/s who are adopting or commissioning mothers
In terms of the Amendment Bill even a woman who legally adopts a child below the age of 3 months or a commissioning mother will be entitled to maternity benefit for a period of 12 weeks. The 12-week period of maternity benefit will be calculated from the date the child is handed over to the adopting or commissioning mother.

This benefit has been introduced for the first time for adopting and commissioning mother/s.



Option to work from home:
After availing the maternity leave benefit, an employer may allow a woman to work from home, if the nature of work assigned to her is such that she may work from home. The terms, conditions and duration for the work from home arrangement would be as per the mutual agreement between the employer and the woman.

The Act does not provide for an option to work from home.

Crèche facility:
Upon having 50 or more employees, every establishment is required to have the facility of crèche within such distance as may be prescribed, either separately or along with common facilities. The employer is required to allow four visits a day to the crèche by the woman, which will also include the interval for rest allowed to her.

This is a new requirement. Under the provisions of the Act there is no requirement to provide for a crèche facility on the part of the employer.

Awareness about maternity benefits:
Every establishment is required to intimate in writing and electronically to every woman at the time of her initial appointment regarding every benefit available under the Act.



The Act is silent on these aspects.

For the first time, the role of a “commissioning mother” has been recognized and defined. A commissioning mother means “a biological mother who uses her egg to create an embryo implanted in any other woman”. Prior to this, the Act did not recognize the role of a commissioning mother.
For woman who have two or more surviving children, the maternity benefit will continue to be 12 weeks, which cannot be availed before six weeks from the date of the expected delivery.


Source: Ministry of Law and Justice

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Impact on SME Industries on Abolition of Cess

GST is the biggest tax reform in India after the Independence. The GST tax reform can clearly be termed as a landmark and India’s biggest tax reform since independence with the aim to streamline India’s fragmented tax system with a single levy. The passing of the GST bill is clearly good news for Indian businesses and will be a game-changer for the SME sector.

Irrespective of the bright side of upcoming GST, SMEs must be cautious of its accompanying challenges such as increase in compliance costs and alignment of IT systems with new processes and transition towards GST.

In order to lay down the path for rolling out Goods and Services Tax (GST) from July, Union Government in a recent Cabinet Meeting held on 23rd March 2017 abolished 16 cesses and surcharges on union excise and service tax.. This would lead to a loss of about Rs 65,000 crore by the exchequer.

It also approved repeal of the Central Excise Tariff Act, 1985 and amendment or repeal of the provisions relating to Acts under which cesses are levied. Cesses to be abolished also include Krishi Kalyan and Swachh Bharat Cess The following proposals was approved by Union Cabinet:

Amendment to the Customs Act, 1962;
ii. Amendments to the Customs Tariff Act, 1975;

iii. Amendment to the Central Excise Act, 1944;

iv. Repeal of the Central Excise Tariff Act, 1985; and

v. Amendment or repeal of the provisions relating to Acts under which cesses are levied.

The amendments in Customs Act will have the following implications for SMEs and Industry:

It will allow for furnishing of information relating to import/export of goods by specified persons so that situations of under/over-valuation in imports and exports can be detected.
It will also authorize Custom Officials to allow for misuse of export promotion schemes including the Drawback Scheme and violations of the provisions of the Customs Act and various other laws under which Customs officials have been authorized to effectively implement these laws
This Amendment in the Customs and Excise Act, relating to abolition of Cesses and Surcharges on various Goods and Services by Union Government can be seen as a cleansing process for removal of the irrelevant portions from the Statute Book which will no longer be relevant once GST is implemented.

In the present situation as per the New Goods and Services Tax ( Compensation to states) Bill 2017 which was passed recently proposes to impose a cess on luxury and demerit goods for the first five years, to create a corpus to compensate states in case of revenue loss once goods and services tax (GST) is implemented. With the levy of this the centre is estimated to gain a corpus of Rs 50,000 crore.

The revenue loss of states will be decided on the difference between revenue from GST and the money a state would have garnered under the old indirect tax regime after considering a 14% increase over the base year of 2015-16

The cess, proposed to be on “water including mineral water and aerated water” that contains sugar or added flavouring, @ 15% .

The objective is to ensure that the tax incidence under GST on specified sin and luxury goods remains at the current rate and also raises receipts to compensate States for revenue loss.

The cess on tobacco products has been capped at ₹4,170 per 1,000 sticks or 290 per cent ad valorem, while on pan masala it is at 135 per cent ad valorem. The cess will be levied over and above the basic GST that will be imposed on these products.

Thus for SMEs GST throws a mixed bag of opportunities and challenges to explore. They need to take into account the slab rate ( 5%, 12%, 18%, 28% ) and cess proposed by government on the products they deal in and take viable business decisions accordingly.

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The Maternity Benefit (Amendment) Act, 2017 comes into force effective 1st April, 2017.

In a Corrigendum issued by the Ministry of Labour and Employment (“Ministry”) on 3rd April,2017, the Ministry has rectified the earlier notification S.O. 1026(E) dated 31st March, 2017(reported in the trail mail) stating that Section 4 (1) of the Maternity Benefit (Amendment) Act, 2017 (“Amendment Act”) will come into effect from 1st July,2017 and not the provision w.r.t the option to work from home [Section 3(5)].

Section 4(1) of the (“Amendment Act”) reads as follows:

(1) Every establishment having fifty or more employees shall have the facility of créche within such distance as may be prescribed, either separately or along with common facilities:

Provided that the employer shall allow four visits a day to the créche by the woman, which shall also include the interval for rest allowed to her.”

Hence, the option to work from home [Section 3(5)] is effective since 1st April, 2017. The requirement to have the crèche facility will be effective from 1st July, 2017.

Impact of the changes:

Maternity leave increases to 26 weeks. Prior to this, woman were entitled to maternity leave benefit of 12 weeks only.
For the first time adopting and commissioning mother/s are being entitled to maternity leave of 12 weeks. Now, a woman who legally adopts a child below the age of 3 months or a commissioning mother will be entitled to maternity benefit for a period of 12 weeks. The 12-week period of maternity benefit will be calculated from the date the child is handed over to the adopting or commissioning mother. [ “commissioning mother” has been recognized and defined. A commissioning mother means “a biological mother who uses her egg to create an embryo implanted in any other woman”. Prior to this, the Act did not recognize the role of a commissioning mother].
Effective 1st July, 2017, an employer may allow a woman to work from home after a woman employee has availed maternity benefit. This may be allowed if the nature of work assigned to her is such that she may work from home. The terms, conditions and duration for the work from home arrangement would be as per the mutual agreement between the employer and the woman. Previously there was no option to work from home.
Now, every establishment upon having 50 or more employees is required to have the facility of crèche either separately or along with common facilities. The employer is required to allow four visits a day to the crèche by the woman, which will also include the interval for rest allowed to her. Previously there was no requirement to provide for a crèche facility on the part of the employer.
Every establishment is required to intimate in writing and electronically to every woman at the time of her initial appointment regarding every benefit available under the Act.
Woman who have two or more surviving children, the maternity benefit will continue to be 12 weeks, which cannot be availed before six weeks from the date of the expected delivery.

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Last date to Complete GST enrollment process for dealers registered under Uttarakhand value added tax is further extended to 31/03/2017

Commercial Tax Department- Government of Uttarakhand has issued a notification and specified that the GST enrollment process will be stopped on 31/03/2017.All the dealers registered under Uttarakhand value added tax are required to complete the GST enrollment process on or before 31/03/2017.

For any query regarding migration to GST, Dealers can contact the Helpline No: 0124-4688999

Source : Commercial Tax Department- Government of Uttarakhand

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