280 / 2022
Quote of the day
The inaugural column features an Amazon best-seller “You Just Got Cheated – Understanding white collar crimes” by my good friend, Dr. Sibichen Mathew, Commissioner of Income Tax (CPC), author, professional speaker, film maker, all rolled into one. This book is the culmination of over 6 years of research into various white collar crimes across the globe.
The name reveals it all – how you and me, common man get cheated day in and day out by all kinds of fraudsters. Right from a car servicing centre to a sham innovator to a ‘promising’ scheme to large corporates to food chains to politicians to NGOs – at different levels and scales we are cheated and we are almost oblivious to it. We think white collar crimes do not affect the common man. We think the so-called ‘system’ will take care of itself. Or wish that it will not repeat again.
Sadly, this is not true. ”History reveals that crimes travel across the globe in time as criminals learn from each other for their criminal indulgences” says Dr. Sibichen. The book does throw light on many cases where scamsters have been nabbed thanks to either public proactiveness or societal angst and action. More often than not the regulators wake up after the crime is committed and try to bolt the horse after it has run out of the stable – tighten the rules and regulations as a reaction rather than as a response ! As evidence shows, by then the criminal is out on the streets, having escaped to a safe haven with the booty. It is you and me who are left stranded as victims, with empty wallets, lost jobs, dead families, failing health and a bruised economy that has an adverse long-term effect on society.
The book is a treatise on the ‘why, how, and what of the WCCs from the perspective of victimology’, rather than revealing the gory details of various kinds of scams alone, which it does in any case. All from a hitherto unexplored, victim perspective to shake us out of our slumber. To create awareness. To call for concerted action. To make us responsible global citizens. To leave the world as a better place….!!
Awareness and action are a result of the awakening within. 9 days of Navaratri is a celebration of Shakthi – an embodiment of Energy, Abundance & Knowledge. It is a time to transit from ‘tamas’ to ‘rajas’, to awaken the energy within us, to come out of our comfort zones, to break the shell of lethargy, to change, to transform, to ACT. So that ABUNDANCE abounds !
As always, MCA has introduced certain changes when we are in the peak of AGMs and annual filings of financial statements. CSR rules have undergone a change requiring additional disclosures in Board’s Report. Small company definition has changed thanks to the enhanced ceiling of turnover and paid up capital criteria (40cr and 4cr). You can have a quick glance on the ready reckoner for small companies under the Companies Act, 2013, as you scroll down for regulatory updates. As you mark out the compliance dates from the statutory calendar and reflect on the ‘BBC’ tips, do enjoy the festive season !
For any previous issues of Samhita and the readers’ feedback, please visit http://www.sharadasc.com/resource-center/.
Right from the title to the ‘dedications’ page, Dr. Sibichen Mathew has made it amply clear who the victim of white-collar crimes (WCC) is – the ubiquitous, unsuspecting, unfortunate common man who is made to believe that the consequence is not him, not now. The book debunks this very myth that a crime committed somewhere does not impact you and me. How does he do it ? By peeling layers after layers of WCC committed across generations, geographies and genres, gleaned from his years of dedicated research and diligent analysis – presented to us with facts, figures and insights in an easy-to-understand 15 chapter format.
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CSR Rules - Amended
MCA vide Notification dtd.20 September 2022 has amended the Companies (Corporate Social Responsibility Policy) Rules, 2014 bringing about following changes:
Proviso added to Rule 3(1) – companies having any unspent amount in the Unspent Corporate Social Responsibility Account are required to constitute a CSR Committee.
Rule 3(2) omitted – the erstwhile sub-rule prescribed that companies which do not fall within the thresholds for CSR for 3 consecutive years shall not be required to constitute CSR Committee. This sub-rule has been omitted.
Rule 4(1) substituted:
Section 8 companies, registered public trust or societies exempted under Section 10(23C)(iv)(v)(vi)(via) of Income Tax Act, 1961 – have been added to clauses (a) and (d) of Rule 4(1), alongwith Sec 12A and 80G approvals and
Explanation inserted in Rule 4 – an explanation clarifying the meaning of “entity” for the purpose of the Rule. The explanation clarifies that a company may achieve it’s CSR obligation through a statutory body constituted under an Act of Parliament or State legislature to undertake activities covered in Schedule VII of the Act.
Permitted administrative overheads chargeable - 2% (reduced from 5%) or 50 lakhs whichever is higher (earlier – whichever is lower).
A revised format for annual report on CSR – introduced. For all Board’s Reports being approved post 20 September 2022 this is applicable.
E-Form CSR-1 amended – to include entities added to Rule 4(1)
The above mentioned changes shall take effect from 20 September 2022.
Definition of Small Companies – scope widened
MCA vide Notification dtd.15 September 2022 had amended the definition of Small Company through amendment to the Companies (Specification of definition details) Rules, 2014.
The amended definition has increased the limits from an upper cap of paid-up capital of Rs.2 crores to Rs.4 crores and turnover of Rs.20 crores to Rs.40 crores. The limits have been doubled making more number of companies eligible to claim the relaxations available for Small Companies under the Companies Act, 2013.
It is to be noted that both limits have to be satisfied.
The widened scope of the Small Companies definitions seems to be yet another change under the Ease of Doing Business Initiative aimed at reducing compliance burden. In view of the same the exemptions and advantages available for Small Companies under Companies Act, 2013 are noteworthy. A ready reckoner consisting of the exemptions available to Small Companies is attached here.
Clarification on Sch III amendments and AOC-4 filing
An update was posted on the MCA website on 26 September 2022 clarifying that the figures in the Form AOC-4 can be mentioned in actuals and the same shall not be considered as incorrect certification. Although the Amended Schedule III of the Companies Act, 2013 requires the financial figures to be rounded off based on their total income.
DIR-3 KYC verification – due date extended
MCA vide notification dated 28 September 2022 has extended the due date for completion of DIR-3 KYC verification (through filing of Form DIR-3KYC or web-based verification) till 15 October 2022 from 30 September 2022.
Framework for Social Stock Exchange
FTP (2015-20) extended for 6 months
Based on the representations received from stakeholders, the Foreign Trade Policy (2015-20) (which was valid till 30 September 2022) has been further extended for a period of 6 months w.e.f.1 October 2022.