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Can any one guide whether FLA is required to be filed in case of issuance of convertible notes to a foreign shareholder?
CN holder doesn't hold any equity share. He has invested only in CN on non-repatriation basis.
In case of private placement which is also a downstream investment as per FEMA. We have taken valuation from reg. valuer+ CA which is 5 months old... shareholders approved private placement basis this valuation and the same is filed with ROC.
In RBI filing the said valuation report being old than 90 days we may expect rejection from RBI and in such case we may take another valuation with current date only for filing purpose.
Please let me know if there is anything wrong in this practice. As per my view we don't need to link valuation requirements of both the laws. And can have separate valuation filed with different authorities. Please advise.
WHAT IS THE Due date for Filing Form FC 3 and FC 4 For F.Y. 2021-2022?
Click here to view / answer Share it onPlease confirm when its applicable to file ?
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Share format for "Declaration with regard to fulfilment of fit and proper person criteria, as per sub-rule (3) of Rule 3B, by all Promoters and Directors of the Company"
Required for filling of NDH-4
If in Private Company there are only two Additional Directors, that will be sufficient for considering BOD ?
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Please confirm company can take unsecured loan from the directors and there relatives with zero rate of interest right ?
But while accepting deposit from directors, they must give a declaration to the company that the amount is their own money and not borrowed.
Please confirm if anything else need to be done ?
DPT-3 also need to be filed ?
The term 'wholesale' used in Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) (Second Amendment) Regulations, 2003, is to be understood in the sense in which it is defined in Indian Statutes and the rules framed thereunder, relating to trade, such as the definitions contained in the Monopolies and Restrictive Trade Practices Act, 1969, Standards of Weights and Measures (Packaged Commodities) Rules, 1977, etc. While bringing out the distinction between 'wholesaler' and 'retailer', he relied on the following.-
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Wholesaling consists of the sale of goods/merchandise to retailers, industrial, commercial, institutional or other professional business users or other wholesalers and related subordinated services.
Retailing services consist of the sale of goods/merchandise for personal or household consumption either from a fixed location (e.g. store, kiosk etc.) or away from a fixed location and related subordinate services.
FDI Policy: Sectors where Government Approval is required
(as on 08.07.2016)
a) FM Radio
b) Uplinking of ‘News & Current Affairs’ TV Channels
5.2.7.2.2
FDI Policy: Sectors under Automatic Route with Conditions
(as on 08.07.2016)
Typically, retail is understood to be the sale of goods to end users, not for resale, but for use and consumption by the purchaser. The retail transaction is at the end of the supply chain. Interestingly, courts in India have defined the term ‘retail’ as a sale for final consumption in contrast to a sale for further sale or processing (i.e. wholesale). The government of India has revised its foreign direct policy (FDI Policy) to allow foreign direct investment (FDI) in the retail sector subject to certain conditions. Some of the key changes to the whole sale sector are discussed in the paragraph below:
The FDI Policy allows 100 % FDI in entities engaged in the business of wholesale cash and carry however, per the FDI Policy, to determine whether the transaction is wholesale or retail would depend on the type of customers to whom the sale is made and not the size and volume of sales. Wholesale trading would mean the sale of goods to retailers, industrial, commercial, other professional business users or to other wholesalers, but not for personal consumption. The FDI Policy also lists a number of ‘valid business customers’ with whom wholesale transactions can be entered into (besides the Government). These entities should have relevant tax and business registrations. It is expressly clarified that a retailer undertaking cash and carry wholesale trade cannot open retail outlets, whereby sales will be made to the customer directly unless retail trading and cash and carry wholesale trading are undertaken through separate business arms, wherein separate books of accounts for both arms of the business are duly audited by statutory auditors. The conditions of the FDI policy for wholesale/cash and carry business and for retail business have to be separately complied with by the respective business arms.Under the existing FDI Policy, wholesale deals would be permitted among companies of the same group. However, such wholesale trade to group companies taken together should not exceed 25 percent of the total turnover of the wholesale venture.
FEMA Notification No. 20(R) deals with Foreign Direct Investment in India and Sectors permitting FDI. As per the said Notification, Trading covers,
•Cash & Carry Wholesale Trading
•E-Commerce
•Single Brand Retail Trading (SBRT)
•Multi Brand Retail Trading (MBRT)
•Duty Free Shops
Cash & Carry Wholesale trading/Wholesale trading means,
•Sale of goods/merchandise to retailers, industrial, commercial, institutional or other professional business users or to other wholesalers and related subordinated service providers.
•Wholesale trading shall, accordingly, imply sales for the purpose of trade, business and profession, as opposed to sales for the purpose of personal consumption.
•The yardstick to determine whether the sale is wholesale or not would be the type of customers to whom the sale is made and not the size and volume of sales.
•Wholesale trading shall include resale, processing and thereafter sale, bulk imports with ex-port/ex-bonded warehouse business sales and B2B e-Commerce.
Sectoral Limit.Sector/Activity
% of Equity/ FDI Cap
Entry Route
Cash & Carry Wholesale Trading/Wholesale Trading (including sourcing from MSEs)
100%
Automatic
Read more here:
285130913ANNEX_B_(1).pdf
FDI-PolicyCircular-2020-29October2020_(2).pdf