February 19, 2024 | CA B K Goyal & Co LLP

Data Bank Notification Relating to IICA

Companies Act 2013 / CA Bhuvnesh Goyal / February 19, 2024

Data Bank Notification Relating to IICA Read More »

The Companies (Appointment and Qualification of Directors) Fifth Amendment Rules,2019.

Companies Act 2013 / CA Bhuvnesh Goyal / February 19, 2024

MINISTRY OF CORPORATE AFFAIRSNOTIFICATIONNew Delhi, the 22nd October, 2019 G.S.R. 804(E).— In exercise of the powers conferred by section 149 read with section 469 of the CompaniesAct, 2013 (18 of 2013), the Central Government hereby makes the following rules further to amend the Companies(Appointment and Qualification of Directors) Rules, 2014, namely:-¹Hkkx IIµ[k.M 3(i)º Hkkjr dk jkti=k % vlk/kj.k 31. (1) These rules may be called the Companies (Appointment and Qualification of Directors) Fifth Amendment Rules,2019.(2) They shall come into force with effect from the 1st day of December, 2019.2. In the Companies (Appointment and Qualification of Directors) Rules, 2014 (hereinafter referred to as the principalrules), for rule 6, the following rule shall be substituted, namely: –“6. Compliances required by a person eligible and willing to be appointed as an independent director.─(1) Every individual –(a) who has been appointed as an independent director in a company, on the date of commencement ofthe Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019, shallwithin a period of three months from such commencement; or(b) who intends to get appointed as an independent director in a company after such commencement,shall before such appointment,apply online to the institute for inclusion of his name in the data bank for a period of one year or five years orfor his life-time, and from time to time take steps as specified in sub-rule (2), till he continues to hold the officeof an independent director in any company:Provided that any individual, including an individual not having DIN, may voluntarily apply to the institute forinclusion of his name in the data bank.(2) Every individual whose name has been so included in the data bank shall file an application for renewal for afurther period of one year or five years or for his life-time, within a period of thirty days from the date of expiryof the period upto which the name of the individual was applied for inclusion in the data bank, failing which, thename of such individual shall stand removed from the data bank of the institute:Provided that no application for renewal shall be filed by an individual who has paid life-time fees for inclusionof his name in the data bank.(3) Every independent director shall submit a declaration of compliance of sub-rule (1) and sub-rule (2) to theBoard, each time he submits the declaration required under sub-section (7) of section 149 of the Act.(4) Every individual whose name is so included in the data bank under sub-rule (1) shall pass an onlineproficiency self-assessment test conducted by the institute within a period of one year from the date of inclusionof his name in the data bank, failing which, his name shall stand removed from the databank of the institute:Provided that the individual who has served for a period of not less than ten years as on the date of inclusion ofhis name in the databank as director or key managerial personnel in a listed public company or in an unlistedpublic company having a paid-up share capital of rupees ten crore or more shall not be required to pass theonline proficiency self-assessment test:Provided further that for the purpose of calculation of the period of ten years referred to in the first proviso, anyperiod during which an individual was acting as a director or as a key managerial personnel in two or morecompanies at the same time shall be counted only once.Explanation: For the purposes of this rule,-(a) the expression “institute” means the ‘Indian Institute of Corporate Affairs at Manesar’ notifiedunder sub-section (1) of section 150 of the Companies Act, 2013 as the institute for the creation andmaintenance of data bank of Independent Directors;(b) an individual who has obtained a score of not less than sixty percent. in aggregate in the onlineproficiency self-assessment test shall be deemed to have passed such test;(c) there shall be no limit on the number of attempts an individual may take for passing the onlineproficiency self-assessment test.” [F. No. 8/4/2018-CL-I- Part II]K. V. R. MURTY, Jt. Secry. Practice area’s of B K Goyal & Co LLP Income Tax Return Filing | Income Tax Appeal | Income Tax Notice | GST Registration | GST Return Filing | FSSAI Registration | Company Registration | Company Audit | Company Annual Compliance | Income Tax Audit | Nidhi Company Registration| LLP Registration | Accounting in India | NGO Registration | NGO Audit | ESG | BRSR | Private Security Agency | Udyam Registration | Trademark Registration | Copyright Registration | Patent Registration | Import Export Code | Forensic Accounting and Fraud Detection | Section 8 Company | Foreign Company | 80G and 12A Certificate | FCRA Registration |DGGI Cases | Scrutiny Cases | Income Escapement Cases | Search & Seizure | CIT Appeal | ITAT Appeal | Auditors | Internal Audit | Financial Audit | Process Audit | IEC Code | CA Certification | Income Tax Penalty Notice u/s 271(1)(c) | Income Tax Notice u/s 142(1) | Income Tax Notice u/s 144 |Income Tax Notice u/s 148 | Income Tax Demand Notice | Psara License | FCRA Online Company Registration Services in major cities of India Company Registration in Jaipur | Company Registration in Delhi | Company Registration in Pune | Company Registration in Hyderabad | Company Registration in Bangalore | Company Registration in Chennai | Company Registration in Kolkata | Company Registration in Mumbai | Company Registration in India | Company Registration in Gurgaon | Company Registration in Noida | Company Registration in lucknow Complete CA Services CA in Delhi | CA in Gurgaon | CA in Noida | CA in Jaipur | CA Firm in India RERA Services RERA Rajasthan | RERA Haryana | RERA Delhi | UP RERA Most read resources tnreginet |rajssp | jharsewa | picme | pmkisan | webland | bonafide certificate | rent agreement format | tax audit applicability | 7/12 online maharasthra | kerala psc registration | antyodaya saral portal | appointment letter format | 115bac | section 41 of income tax act | GST Search Taxpayer | 194h | section 185 of companies act 2013 | caro 2020 | Challan 280 | itr intimation password | internal

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The Companies (Creation and Maintenance ofdatabank of Independent Directors) Rules, 2019

Companies Act 2013 / CA Bhuvnesh Goyal / February 19, 2024

MINISTRY OF CORPORATE AFFAIRSNOTIFICATIONNew Delhi, the 22nd October, 2019 G.S.R. 805(E).—In exercise of the powers conferred by section 150 read with section 469 of the Companies Act,2013 (18 of 2013), the Central Government hereby makes the following rules, namely:—1. Short Title and Commencement.─(1) These rules may be called the Companies (Creation and Maintenance ofdatabank of Independent Directors) Rules, 2019.(2) The provisions of these rules, other than rule 2 and 5, shall come into force with effect from the 1st day ofDecember, 2019.(3) The provisions of rule 2 and 5 shall come into force on the date of publication of this notification in the OfficialGazette.2. Definitions.─(1) In these rules, unless the context otherwise requires, ─(a) “Act” means the Companies Act, 2013 (18 of 2013);(b) “institute” means the ‘Indian Institute of Corporate Affairs’ notified under sub-section (1) of section 150 of theCompanies Act, 2013.(2) Words and expressions used and not defined in these rules but defined in the Act shall have the same meanings asrespectively assigned to them in the Act.3. Creation and maintenance of data bank.─ (1) The institute shall create and maintain a databank of persons willingand eligible to be appointed as independent directors, and such databank shall be an online databank which shall beplaced on the website of the institute.(2) The data bank referred to in sub-rule (1) shall contain the following details in respect of each person included in thedata bank to be eligible and willing to be appointed as independent director—(a) DIN (Director Identification Number), if applicable;(b) Income Tax PAN;(c) the name and surname in full;(d) the father’s name;(e) the date of Birth;(f) gender;(g) the nationality;(h) the occupation;(i) full Address with PIN Code (present and permanent);(j) phone number;(k) e-mail id;(l) the educational and professional qualifications;(m) experience or expertise, if any;(n) any pending criminal proceedings as specified in clause (d) of sub-section (1) of section 164;(o) the list of limited liability partnerships in which he is or was a designated partner along with—¹Hkkx IIµ[k.M 3(i)º Hkkjr dk jkti=k % vlk/kj.k 5(i) the name of the limited liability partnership;(ii) the nature of industry; and(iii) the duration- with dates;(p) the list of companies in which he is or was director along with—(i) the name of the company;(ii) the nature of industry;(iii) the nature of directorship—Executive or Non-executive or Managing Director or Independent Director orNominee Director; and(iv) duration – with dates.(3) The information available in the data bank shall be provided only to companies required to appoint independentdirector after paying a reasonable fees to the institute.(4) A person whose name is included in the data bank, may restrict his personal information to the institute, to bedisclosed in the data bank.(5) Any individual whose name appears in the data bank, shall make changes in his particulars within thirty days of suchchange through web based framework made available by the institute for this purpose.(6) A disclaimer shall be conspicuously displayed on the website hosting the data bank that a company must carry out itsown due diligence before appointment of any person as an independent director.(7) The institute, shall with the prior approval of the Central Government, fix a reasonable fee to be charged from :—(a) individuals for inclusion of their names in the data bank of independent directors; and(b) companies for providing the information on independent directors available on the data bank.Explanation:- For the purpose of this rule, the expression “persons willing and eligible to be appointed as independentdirector” shall include individuals already serving as independent directors on the Board of companies.4. Duties of the institute.─ (1) The institute shall comply with the following, in respect of individuals referred to in subrule (1) of rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014 , namely:—(a) conduct an online proficiency self-assessment test covering companies law, securities law, basicaccountancy, and such other areas relevant to the functioning of an individual acting as anindependent director;(b) prepare a basic study material, online lessons, including audio-visuals for easy reference ofindividuals taking the online proficiency self-assessment test;(c) provide an option for individuals to take advanced tests in the areas specified in clause (a) andprepare the necessary advanced study material in this respect:Provided that no separate fees shall be charged by the institute in respect of clauses (a), (b) and (c).(2) The institute shall daily, share with the Central Government, a cumulative list of all individuals—(a) whose names have been included in the data bank along with the date of inclusion and their Income TaxPAN or Passport number in case of foreign director (not required to have Income-Tax PAN);(b) whose applications for inclusion in the data bank have been rejected along with grounds and the dates ofsuch rejection; and(c) whose names have been removed from the data bank along with grounds and the dates of such removal.5. Panel.—(1) There shall be a panel of not more than ten members nominated by the Central Government, for thepurpose of approving the outline of the courses and study material prepared by the institute.(2) Panel referred to in sub-rule (1) shall consist of:—(a) Secretary, Ministry of Corporate Affairs or his nominee;(b) Director General and Chief Executive Officer of the institute or his nominee;(c) one member nominated by the Department of Economic Affairs;(d) one member nominated by the Department of Public Enterprises;(e) one member nominated by the Securities and Exchange Board of India;6 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)](f) at-least one representative from the stock exchange nominated by the Central Government;(g) at-least one representative from the industry nominated by the Central Government; and(h) at-least one representative from the academia nominated by the Central Government. [F. No. 8/4/2018-CL-I]K. V. R. MURTY, Jt. Secy. Practice area’s of B K Goyal & Co LLP Income Tax Return Filing | Income Tax Appeal | Income Tax Notice | GST Registration | GST Return Filing | FSSAI Registration | Company Registration | Company Audit | Company Annual Compliance | Income Tax Audit | Nidhi Company Registration| LLP Registration | Accounting in India | NGO Registration | NGO Audit | ESG | BRSR |

The Companies (Creation and Maintenance ofdatabank of Independent Directors) Rules, 2019 Read More »

The Companies (Accounts) Amendment Rules, 2019

Companies Act 2013 / CA Bhuvnesh Goyal / February 19, 2024

The Companies (Accounts) Amendment Rules, 2019 Read More »

Notification -Section 396 dt 30.10.2019

Companies Act 2013 / CA Bhuvnesh Goyal / February 19, 2024

Notification -Section 396 dt 30.10.2019 Read More »

Notification dt 30.10.2019-ROC-Jammu

Companies Act 2013 / CA Bhuvnesh Goyal / February 19, 2024

Notification dt 30.10.2019-ROC-Jammu Read More »

Notification dt 30.10.2019

Companies Act 2013 / CA Bhuvnesh Goyal / February 19, 2024

Notification dt 30.10.2019 Read More »

The Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings ofFinancial Service Providers and Application to Adjudicating Authority) Rules, 2019

Companies Act 2013 / CA Bhuvnesh Goyal / February 19, 2024

MINISTRY OF CORPORATE AFFAIRSNOTIFICATIONNew Delhi, the 15th November, 2019 G.S.R. 852(E). —In exercise of the powers conferred under section 227 read with clause (zk) of sub-section(2) of section 239 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Central Government hereby makesthe following rules, namely:―1. Short title and commencement.-(1) These rules may be called the Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings ofFinancial Service Providers and Application to Adjudicating Authority) Rules, 2019.(2) These rules shall come into force on the date of their publication in the Official Gazette.2. Application. ― These rules shall apply to such financial service providers or categories of financial serviceproviders, as may be notified by the Central Government under section 227, from time to time, for the purpose oftheir insolvency and liquidation proceedings under these rules.3. Definitions. ― (1) In these rules, unless the context otherwise requires,-(a) “Administrator” means an individual appointed by the Adjudicating Authority under sub-clause (iii) ofclause (a) of rule 5, to exercise the powers and functions of the insolvency professional, interimresolution professional, resolution professional or the liquidator for the purpose of insolvency andliquidation proceedings of a financial service provider;(b) “Advisory Committee” means the Committee constituted by the appropriate regulator in accordance withclause (c) of rule 5 of these rules;(c) “appropriate regulator” means the financial sector regulator, as may be notified by the CentralGovernment under section 227, for a category of financial service providers;(d) “Code” means the Insolvency and Bankruptcy Code, 2016 (31 of 2016);(e) “Form” means a Form appended to these rules; and(f) “identification number” means the corporate identity number or the limited liability partnershipidentification number, as the case may be, of a financial service provider.(2) The words and expressions used and not defined in these rules but defined in the Code shall have the meaningsrespectively assigned to them in the Code.4. General modifications. – For the purposes of these rules, in all the provisions relating to insolvency and liquidationproceedings under the Code,-(i) for the expression “corporate debtor” wherever they occur, shall mean “financial service provider”; and(ii) for the expressions “insolvency professional”, “interim resolution professional”, “resolution professional” or“liquidator”, wherever they occur, shall mean “administrator”.5. Corporate Insolvency Resolution Process of financial service providers.― The provisions of the Code relating tothe Corporate Insolvency Resolution Process of the corporate debtor shall, mutatis mutandis apply, to the insolvencyresolution process of a financial service provider subject to the following modifications, namely:―(a) Initiation of Corporate Insolvency Resolution Process.-(i) no corporate insolvency resolution process shall be initiated against a financial service provider which hascommitted a default under section 4, except upon an application made by the appropriate regulator in accordancewith rule 6;(ii) the application under sub-clause (i) shall be dealt with in the same manner as an application by a financialcreditor under section 7, subject to clause (iii); and(iii) on the admission of the application, the Adjudicating Authority shall appoint the individual proposed by theappropriate regulator in the application filed under sub-clause (i) of clause (a) of rule 5, as the Administrator.(b) Moratorium.- Save as provided in section 14,-(i) an interim moratorium shall commence on and from the date of filing of the application under clause (a) tillits admission or rejection; and¹Hkkx IIµ[k.M 3(i)] Hkkjr dk jkti=k % vlk/kj.k 9(ii) the license or registration which authorises the financial service provider to engage in the business ofproviding financial services shall not be suspended or cancelled during the interim-moratorium and thecorporate insolvency resolution process.Explanation.- For the purposes of this clause, “interim moratorium” shall have the effect of the provisions ofsub-sections (1), (2) and (3) of section 14.(c) Advisory Committee.-(i) the appropriate regulator may, where deemed necessary, constitute an Advisory Committee, within 45 days ofthe insolvency commencement date, to advise the Administrator in the operations of the financial serviceprovider during the corporate insolvency resolution process;(ii) the Advisory Committee shall consist of three or more Members, who shall be persons of ability, integrityand standing, and who have expertise or experience in finance, economics, accountancy, law, public policy orany other profession in the area of financial services or risk management, administration, supervision orresolution of a financial service provider;(iii) the terms and conditions of the Members of the Advisory Committee and the manner of conductingmeetings and observance of rules of procedure shall be such as may be determined by the appropriate regulator;(iv) the compensation paid to the Members of the Advisory Committee shall be part of the insolvency resolutionprocess costs;(v) the Administrator shall chair the meetings of the Advisory Committee.(d) Resolution plan.-(i) the resolution plan shall include a statement explaining how the resolution applicant satisfies or intends tosatisfy the requirements of engaging in the business of the financial service provider, as per laws for the timebeing in force;(ii) upon approval of the resolution plan by the committee of creditors under sub-section (4) of section 30, theAdministrator shall seek ‘no objection’ of the appropriate regulator to the effect that it has no objection to thepersons, who would be in control or management of the financial service provider after approval of theresolution plan under section 31;(iii) the appropriate regulator shall without prejudice to the provisions contained in section 29A, issue ‘noobjection’ on the basis of the ‘fit and proper’ criteria applicable to the business of the financial service provider;(iv) where an appropriate regulator does not refuse ‘no objection’ on an application made under clause (ii)within forty-five working days of receipt of such application, it shall be deemed that ‘no objection’ has beengranted.6. Filing of application and application fee.—(1) Till such time the rules of procedure for conduct of proceedings under the Code are notified, the application madeunder clause (a) of rule 5 shall be filed before the Adjudicating Authority in accordance with rules 20, 21, 22, 23, 24 and26 of Part III of the National Company Law Tribunal Rules, 2016 made under the provisions of the Companies Act,2013.(2) An applicant under these rules shall immediately after becoming aware, notify the Adjudicating Authority of anywinding-up petition presented against the financial service provider.(3) The application under sub-clause (i) of clause (a) of rule 5 shall be

The Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings ofFinancial Service Providers and Application to Adjudicating Authority) Rules, 2019 Read More »

Notification of personalguarantors to corporate debtors

Companies Act 2013 / CA Bhuvnesh Goyal / February 19, 2024

Notification of personalguarantors to corporate debtors Read More »

Contribution margin

Business / CA Bhuvnesh Goyal / February 19, 2024

Contribution margin is a business’s sales revenue less its variable costs. The resulting contribution dollars can be used to cover fixed costs (such as rent), and once those are covered, any excess is considered earnings. Contribution margin (presented as a % or in absolute dollars) can be presented as the total amount, amount for each product line, amount per unit, or as a ratio or percentage of net sales. What Is Contribution Margin? The contribution margin can be stated on a gross or per-unit basis. It represents the incremental money generated for each product/unit sold after deducting the variable portion of the firm’s costs.The contribution margin is computed as the selling price per unit, minus the variable cost per unit. Also known as dollar contribution per unit, the measure indicates how a particular product contributes to the overall profit of the company.It provides one way to show the profit potential of a particular product offered by a company and shows the portion of sales that helps to cover the company’s fixed costs. Any remaining revenue left after covering fixed costs is the profit generated. Formula and Calculation of Contribution Margin The contribution margin is computed as the difference between the sale price of a product and the variable costs associated with its production and sales process. This is expressed through the following formula: C=R−VC=R−V Where C is the contribution margin, R is the total revenue, and V represents variable costs. It may also be useful to express the contribution margin as a fraction of total revenue. In this case, the Contribution Margin Ratio (CR) is expressed as the contribution margin, divided by total revenues in the same time period: CR=(R−V)RCR=R(R−V) What Contribution Margin Can Tell You The contribution margin is the foundation for break-even analysis used in the overall cost and sales price planning for products. The contribution margin helps to separate out the fixed cost and profit components coming from product sales and can be used to determine the selling price range of a product, the profit levels that can be expected from the sales, and structure sales commissions paid to sales team members, distributors, or commission agents. Fixed Cost vs. Variable Cost One-time costs for items such as machinery are a typical example of a fixed cost that stays the same regardless of the number of units sold, although it becomes a smaller percentage of each unit’s cost as the number of units sold increases.Other examples include services and utilities that may come at a fixed cost and do not have an impact on the number of units produced or sold. For example, if the government offers unlimited electricity at a fixed monthly cost of $100, then manufacturing 10 units or 10,000 units will have the same fixed cost towards electricity. In these kinds of scenarios, electricity will not be considered in the contribution margin formula as it represents a fixed cost. However, if the electricity cost increases in proportion to consumption, it will be considered a variable cost. Fixed costs are often considered sunk costs that once spent cannot be recovered. These cost components should not be considered while taking decisions about cost analysis or profitability measures. Contribution Margin vs. Gross Profit Margin The contribution margin is different from the gross profit margin, the difference between sales revenue and the cost of goods sold. While contribution margins only count the variable costs, the gross profit margin includes all of the costs that a company incurs in order to make sales.The contribution margin shows how much additional revenue is generated by making each additional unit product after the company has reached the breakeven point. In other words, it measures how much money each additional sale “contributes” to the company’s total profits. Uses of Contribution Margin The contribution margin can help company management select from among several possible products that compete to use the same set of manufacturing resources. Say that a company has a pen-manufacturing machine that is capable of producing both ink pens and ball-point pens, and management must make a choice to produce only one of them. If the contribution margin for an ink pen is higher than that of a ball pen, the former will be given production preference owing to its higher profitability potential. Such decision-making is common to companies that manufacture a diversified portfolio of products, and management must allocate available resources in the most efficient manner to products with the highest profit potential. How to Improve Contribution Margin Based on the contribution margin formula, there are two ways for a company to increase its contribution margins; They can find ways to increase revenues, or they can reduce their variable costs.Variable costs tend to represent expenses such as materials, shipping, and marketing, Companies can reduce these costs by identifying alternatives, such as using cheaper materials or alternative shipping providers.Alternatively, the company can also try finding ways to improve revenues. For example, they can increase advertising to reach more customers, or they can simply increase the costs of their products. However, these strategies could ultimately backfire and result in even lower contribution margins. FAQs Why is Contribution Margin Important? Contribution Margin is crucial for assessing the profitability of individual products or services. It helps in determining the amount available to cover fixed costs and contribute to the company’s profit. What is the Significance of Contribution Margin Ratio? The Contribution Margin Ratio is expressed as a percentage and is calculated by dividing the Contribution Margin by the Total Sales Revenue. It helps in analyzing the efficiency and profitability of the business. Can Contribution Margin be Negative? Yes, Contribution Margin can be negative if variable costs exceed total sales revenue. This indicates that the product or service is not covering its variable costs. Practice area’s of B K Goyal & Co LLP Income Tax Return Filing | Income Tax Appeal | Income Tax Notice | GST Registration | GST Return Filing | FSSAI Registration | Company Registration | Company Audit | Company Annual Compliance | Income Tax Audit | Nidhi Company Registration| LLP Registration | Accounting in India | NGO Registration | NGO Audit | ESG | BRSR

Contribution margin Read More »