A To Z Of The Insolvency And Bankruptcy Code: A Beginner's Guide (Part II)

In the previous part (click here), we gave you a general background to the Insolvency and Bankruptcy Code, 2016 (IBC) and tried unpacking some specific concepts crucial to its functioning. We introduced you to the central actors of the IBC regime: Adjudicating Authority (AA), Committee of Creditors (CoC) and financial creditors, including the latest addition to the group—homebuyers. Additionally, we briefly analysed some of the more advanced concepts such as 'cross-border insolvency', 'group...

MSMEs Move Gujarat HC Seeking Waiver Of Fixed Minimum Demand Electricity Charges [Read Petition]

The Gujarat High Court on Friday issued notice returnable within a week on a petition filed by Gujarat Re-Rolling Mills Association seeking waiver of fixed minimum demand electricity charges for the months of May and June, 2020. The plea drawn by Advocate Arpit R. Singhvi, states that the Distribution Companies are demanding fixed demand electricity charges for the month of May,...

Contributions By Corporates To PM CARES Fund To Be Considered As CSR Activity: Centre Amends Schedule VII Of Companies Act [Read Notification]

Contributions made by companies to PM CARES will be considered as Corporate Social Responsibility funds under the Companies Act 2013. The Government has issued a notification amending Schedule VII of the Companies Act 2013 for this purpose. The notification shall be deemed to have come into force on 28th March, 2020. Section 135 of the Companies Act, 2013, mandates all companies, having...

MSME Act : Legal Conundrum In Definition of 'Supplier' Under Micro, Small and Medium Enterprises Development Act

1. This article aims to address the conflict in the interpretations of various High Courts of India to the definition of 'supplier' as enumerated under Section 2(n) of the Micro, Small and Medium Enterprises Development Act of 2006, and its impact on reference of disputes to the Micro and Small Enterprises Facilitation Council (Facilitation Council). 2. The Micro, Small and Medium Enterprises Development Act of 2006 (The Act) was brought into force by the...

Technical Defaults Under Companies Act To Be Decriminalized : Minister Of Corporate Affairs

Nirmala Sitharaman, Union Minister of Corporate Affairs, on Sunday announced the plans to decriminalize various technical defaults under the Companies Act 2013.Violations involving minor and procedural defaults such as shortcomings in CSR reporting, inadequacies in board reports, filing defaults, delay in holding AGM etc will be decriminalized, said Nirmala Sitharaman, Finance Minister,...

PF Contribution Of Employers & Employees Reduced From 12% To 10%; MSME Definition Changed : Finance Ministry Announcements

The Union Finance Ministry on Wednesday made several announcements with the aim of giving a boost to the Micro, Medium and Small Enterprises in the country which are reeling under the impact of COVID-19 lockdown.Among others, Nirmala Sitharaman, the Finance Minister, announced a change in the definition of MSMEs.Investment limit which defined MSME has been revised upwards, said...

Role of Facilitation Council Under MSMED Act – A 'Conciliator' Or An 'Arbitrator'?

Introduction: Since the implementation of The Micro, Small and Medium Enterprises Development Act, 2006 ["MSMED Act"], which is a special Act[i], there has always been a controversy as to whether the 'Facilitation Council' can act as both - a 'conciliator' as well as an 'arbitrator', when disputes are referred to it under Section 18(1) thereof. There are divergent views of the High Courts on this very issue and till date, there is no definite answer. The...

Exclusion Of CM And State COVID Relief Funds From CSR Is Patently Unconstitutional

Among all the departments of the government of India, one might consider the ministry of corporate affairs the least political of the lot. Despite a benign sounding name and a mostly technical mandate to regulate the corporate sector, it's recent decision to funnel all CSR donations away from State and CM funds, solely to the PM Cares Fund, has given it a disturbingly political tinge. But even keeping the 'political' aspect of their decision aside, the consequences that will follow...

Future Of Mediation In Insolvency Proceedings

Alternate Dispute Resolution method for resolving the disputes is relatively new trend in India. Mediation being one of the alternate dispute resolution methods in India is a voluntary process where the disputing people decide to mutually find a solution to their legal problem by appointing a mediator and entering a mutual understanding. The decision making power lies with the parties in dispute, with the mediator acting as an intermediary to bring them to an understanding. India started...

The Micro, Small And Medium Enterprises Development Act, 2006 - A Subject Of Increasing Misuse

The small scale sector plays an important role in the development of the Indian economy, by providing employment and facilitating growth of the industrial sector, while requiring a relatively small amount of initial capital investment. A substantial contribution is made by this sector to industrial output and exports. By some estimates there were in excess of 19.40 lakh such in the year 1990-1991. In the early 1990's, Parliament recognising the importance of this sector and in order to ...

Breaking: Bombay HC Stays Bail Granted To Former IL&FS CEO & Vice Chairman As Offences Are Punishable With More Than 7 yrs

A special bench of the Bombay High Court on Saturday stayed the bail granted to former MD and CEO of Infrastructure Leasing and Financial Services (IL&FS) Financial Services Ltd (IFIN) Ramesh Bawa and former Vice Chairman Hari Sankaran, observing that they have been accused of offences punishable with more than 7 years, making them ineligible to be released on parole. Justice...

Cabinet Approves 72 Changes To Decriminalize Companies Act, 2013 [Read Bill]

The Union Cabinet on Wednesday approved the Companies (Second Amendment) Bill, 2019 to amend the Companies Act, 2013, with an aim to increase the ease of doing business in India. As per the press release issued by the Finance Ministry, the Amendment Bill will, inter alia, enable the listing of Indian companies on stock exchanges in foreign jurisdictions. This is expected to increase...