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02 三月 2022

Corporate Amicus: December 2021

Article

SEBI’s new norms for related party transactions – An overview
By Samyukta Shetty and Astha Sinha

The article in this issue of Corporate Amicus reviews the recent changes made by the Securities and Exchange Board of India (‘SEBI’) in the related party transaction (‘RPT’) regime for listed entities. The article discusses the changes made in the definition of ‘related party’ and how the ambit of RPT has been widened to include transactions between a listed entity or its subsidiaries on one side and a related party of the listed entity or its subsidiaries on the other side. It lists the transactions that have been excluded from the purview of RPT and how the ambit of a material RPT has also been modified. Further, it considers the increased scope of audit committee approval and points out that now the listed entities must provide the details of loans, deposits and inter-corporate deposits made along with the purpose for which the funds will be utilized by the ultimate beneficiary. According to the authors, it remains to be seen how listed entities will cope with the increased approval and disclosure requirements and the secretarial compliances that will follow...

Notifications and Circulars

  • General permission for infusion of capital in overseas branches and subsidiaries by banks
  • RBI introduces Legal Entity Identifier for cross-border transactions
  • Transaction in corporate bonds through Request for Quote platform by Portfolio Management Services
  • LLPs can file Form 8 without additional fees till 30 December 2021
  • AGM meeting via a video conference and other audio-visual means till 30 June 2022
  • EGMs via video conference and other audio-visual means till 30 June 2022
  • SEBI issues Master Circular for Real Estate Investment Trusts
  • Fit and proper person – SEBI (Intermediaries) Regulations, 2008 amended
  • Public utility service status extended for another 6 months for services engaged in uranium industry
  • ESIC relaxes the time limit for filing and depositing ESI contributions
  • Code on Wages (Delhi) Rules, 2021 notified by labour department of Delhi
  • Delhi Shops and Establishments (Amendment) Rules, 2021 notified

Ratio decidendi

  • NCLT does not have residuary jurisdiction to entertain contractual disputes arising dehors insolvency of corporate debtor – Supreme Court
  • Merely using the term ‘fraud’ without providing particulars is not ‘fraud’ for bar under Section 34 of SARFAESI Act, 2002 – Supreme Court
  • Filing for appointment of arbitrator after observing conciliation proceedings is not premature when a party refuses to conciliate for an interminable period – Delhi High Court
  • Contractual bar on interest does not only bar the parties from claiming it but also the Arbitrator from awarding it – Supreme Court

News Nuggets

  • Limitation – Sending reminders for payment not extends limitation for claims
  • Proceedings initiated under Section 138 of Negotiable Instruments Act, 1881 is not maintainable against the Corporate Debtor if natural persons are not included in proceedings
  • Guidelines on internal governance for investment firms issued by European Banking Authority

December 2021/Issue-123 December 2021/Issue-123

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