| Life insurers can't participate in repo transactions: Irda |
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Mumbai, 4 December The Insurance Regulatory and Development Authority ( Irda) today said life insurance companies were not permitted to participate in repo transactions. In the case of reverse repo ( lending) transactions in government securities and corporate debt securities, the regulator said the exposure should not exceed 10 per cent of all funds taken together. At a segregated fund level, too, Irda said the exposure should not exceed 10 per cent of the fund size. For non- life insurers, the regulator said exposure to reverse repo and repo transactions in government securities and corporate debt securities should not exceed 10 per cent of the company's investment assets. "The tenor of repo transactions shall not exceed a period of six months," said Irda, in a circular. And, that all companies would have to take prior approval of its investment committee before entering into a repo transaction. The underlying debt security would have to be listed, with a minimum rating of AA or equivalent, said the circular. Further, it said reverse repo and repo transactions in corporate debt securities would not be permitted between an insurer and its promoter group entities. And, said Irda, on accounting methodology and reporting of trades for reverse repo and repo transactions, companies would have to follow the Reserve Bank of India's directions of January 2010. NEW NORMS |At segregated fund level, exposure should not exceed 10% of fund size |For non- life insurers, exposure to reverse repo and repo transactions in G- Secs and corporate debt securities should not exceed 10% of investment assets |Tenor of repo transactions not to exceed 6 months |Require prior approval of investment committee before repo transactions |Underlying debt security to be listed, with minimum rating of AA or equivalent |Reverse repo and repo transactions in corporate debt securities not permitted between insurer and promoter group entities Detailed checks on exposure in other securities' deals, transactions; accounting methodology to follow central bank rules |
| Bombay HC questions Sebi in CIC- RIL case |
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Mumbai, 4 December The high court here adjourned the Securities and Exchange Board of India ( Sebi)- Central Information Commission (CIC) case to December 19, while directing that Reliance Industries Ltd ( RIL) be made a party. Sebi is appealing against an order of the central information commissioner, Satyananda Mishra ( appellate authority under the national Right to Information Act), last month, asking it to disclose information in the 2007 RIL insider trading case. The CIC had passed this directive on an appeal filed by a Bangalorebased lawyer and RTI activist, Arun Agrawal, who had asked Sebi to disclose details of the consent order proceedings in the case and the identity of the entities involved in the alleged insider trading. The bench of judges D Y Chandrachud and A A Sayed today said RIL should be given achance to present its version, as the disclosures in question pertain to the company. "We may accept their case or reject it. Everybody has to be given a chance," said Chandrachud today, while posting the matter to December 19. Arun Agrawal, appearing in person, argued there was no need to hear RIL. " If it is a bank, income tax department or lawyer, there is a fiduciary relationship. But there cannot be a fiduciary relationship between a regulator and aviolator," he said. The court today asked the Sebi counsel why the regulator should have any problem in disclosing the information on the basis of which it had come out with a consent circular. "He ( Arun Agrawal) wants disclosure on the underlying process. What is the harm in disclosing the file notings? Ultimately, you have issued that circular. It is not something that is confidential. You have a file relating to that circular. Give him that file," said Chandrachud. The court directed the counsel to take instructions from the regulator on whether it could disclose the file notings and the underlying process of the consent route circular. The counsel, Jamshed Cama, argued that information regarding a commercial confidence or trade secrets cannot be given unless the CIC proved it would be in the public interest to do so. "Prima facie, CIC could be satisfied that this is in the public interest. But the question is, is it merely enough to say that? He should demonstrate in his order as to how it is in the public interest," said Cama. In reply, Agrawal said such disclosures would keep the general public informed and educated about the risks they confront while investing in the market. " Even with the most hardened criminal, his face is covered but his name is made public," he said. Agrawal questioned Sebi's rationale behind settling a ₹ 500- crore insider trading case with a consent order of just ₹ 10 crore. " If a ₹ 500- crore case is settled for ₹ 10 crore, then every party who violates rules will ask why should I not be given the privilege of giving 10 per cent of the loot and get exonerated," he argued. When Chandrachud asked the status of the case, the Sebi counsel said the investigation report was complete and it had to be considered by a Sebi wholetime member. "The next step would be prosecution or penalty," said Cama. Asks why disclosure of file notings and procedure should be a problem, directs RIL be made party; next hearing on Dec 19 2007: RIL allegedly indulges in insider trading in Reliance Petroleum shares 2008: Sebi begins probe in the matter 2010: Sebi initiates quasi- judicial proceedings against RIL Nov 6, 2012: CIC's Mishra asks Sebi to disclose details of the case following RTI appeal by Agrawal Nov 24, 2012: Sebi appeals in Bombay HC against CICs order Dec 4, 2012: Bombay HC says make RIL party to the case; Adjourns case to December 19 THE INSIDE JOB |
Source Times of india
Pilot to pitch for tax relief on CSR spend
The author has posted comments on this articlePankaj Doval, TNN | Dec 5, 2012, 01.50AM IST
NEW DELHI: The corporate affairs ministry on Tuesday said it would pitch for tax exemptions for companies that spend 2% of their net profit on CSR activities as proposed in the new Companies Bill, even as it refused to make the spending mandatory.
Corporate affairs minister Sachin Pilot, who met industry captains over the issue, said the government has no intention of being a "watchdog" over the implementation of the measure but rather make it voluntary and participatory for Indic Inc. "We do not want an inspector raj, but rather have a system which is self regulating and self compliant," Pilot said.
The Companies Bill is pending in Parliament and stipulates a CSR spend for every company having net worth of Rs 500 crore or more, or turnover of Rs 1,000 crore or more or a net profit of Rs 5 crore or more during a financial year. It asks for a spend of "at least 2%" of the average net profit of the three immediately preceding financial years. "We have taken this suggestion that was made in the deliberations. I will discuss this with the finance ministry to evolve some sort of a middle ground," he said, though refusing to share further details. But while the 2% spend is voluntary, Pilot said a company qualifying for it will have to explain if it fails to do so. "If they do not spend 2%, they will have to report about it. If they fail to do so, then they will have to face action under Section 134 as enshrined in the Bill." Section 134 says that any company that contravenes the CSR spend provision, and also fails to explain the reason for the same in its reporting, shall be punishable with a fine not less than Rs 25,000 but which may extend to Rs 25 lakh. Also, every officer of the company in default shall be punishable with imprisonment for a term which may extend to three years or with a fine not less than Rs 25,000 but extendable up to Rs 25 lakh, or with both. As many as 11,000-13,000 companies could be eligible for the CSR spend, Pilot said, adding that the ministry's website will have a template detailing the manner of reporting. Pilot said he would try to see that the bill is taken up in the ongoing Winter session
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