The Undisclosed

Foreign Income
and Assets
(Imposition of
Tax) Bill, 2015
The Bill will
apply to Indian
residents and
seeks to replace
the Income Tax
(IT) Act, 1961 for
the taxation of
foreign income.
It penalizes the
concealment of
foreign income,
and provides for
criminal liability
for attempting to
evade tax in
relation to foreign
income.

Strictly speaking, the term non-resident refers only to the tax status of a person who, as per
section 6 of the Income-tax Act of 1961, has not resided in India for a specified period for
the purposes of the Income Tax Act.The rates of income tax are different for persons who
are "resident in India" and for NRIs. For the purposes of the Income Tax Act, "residence in
India" requires stay in India of at least 182 days in a calendar year or 365 days spread out
over four consecutive years. According to the act, any Indian citizen who does not meet the
criteria as a "resident of India" is a non-resident of India and is treated as NRI for paying
income tax
Tax rate: A flat rate of 30 per cent tax would apply to undisclosed foreign income or assets
of the previous assessment year. No exemption, deduction or set off of any carried forward
losses (as provided under the IT Act) would apply. This would apply from April 1, 2016
onwards.
Scope of income to be taxed: The total undisclosed foreign income and asset of an
individual would include: (i) income, from a source located outside India, which has not
been disclosed in the tax returns filed; (ii) income, from a source outside India, for which
no tax returns have been filed; and (iii) value of an undisclosed asset, located outside India
One - time compliance opportunity: A one-time compliance opportunity to persons who
have any undisclosed foreign assets (for all previous assessment years) will be provided for
a limited period. Such persons would be permitted to file a declaration before a tax
authority, and pay a penalty at the rate of 100%.

Penalty for offences:

o Undisclosed foreign income/assets: The penalty for nondisclosure of
foreign income or assets would be equal to three times the amount of tax
payable, in addition to tax payable at 30%.
o Failure to furnish returns: The penalty for not furnishing income tax
returns in relation to foreign income or assets is a fine of Rs 10 lakh.
This would not apply to an asset, with a value of five lakh rupees or less.
o Undisclosed or inaccurate details of foreign assets: If a person who has
filed tax returns does not disclose his foreign income, or submits
inaccurate details of the same, he has to pay a fine of Rs 10 lakh. This
would not apply to an asset, with a value of five lakh rupees or less.
o Second time defaulter: Any person, who continues to default in paying
tax that is due, would be liable to pay an amount equal to the amount of
tax arrears.
o Other defaults: If a person fails to abide by the tax authority in (i)
answering questions, (ii) signing off on a statement, (iii) attending or
producing relevant documents, he is to pay a fine between Rs 50,000 to
two lakh rupees.

Prosecution for certain offences:

o Wilful attempt to evade tax: The punishment would be rigorous
imprisonment from three to 10 years, and a fine.
o Wilful attempt to evade payment of tax: The punishment would be
rigorous imprisonment from three months to three years, and a fine.
o Failure to furnish returns: or non disclosure of foreign assets in returns:
The punishment is rigorous imprisonment of six months to seven years,
and fine.
o Punishment for abetment: The punishment is rigorous imprisonment of
six months to seven years, and fine.
o Liability of company: For any offence under this Act, every person
responsible to the company is to be liable for punishment. His liability is

absolved if he proves that the offence was committed without his

knowledge.

The Warehousing
Corporations
(Amendment)
Bill, 2015

The Warehousing Corporations Act, 1962 established central and state warehousing
corporations for the purpose of warehousing agricultural produce and other commodities.
The Bills Statement of Objects and Reasons states that the Central Warehousing
Corporation has been awarded a Mini-Ratna Public Sector Enterprise status by the
Department of Public Enterprises. One of the criteria to be a Mini-Ratna
enterprise is that there should be no financial support from the government to the
enterprise, and that it must be independent of any budgetary support or guarantee
by the government.

Currently, a section in the Act requires that the Central Government guarantee the
repayment of the principal and annual minimum dividend payments on shares to
the central warehousing corporation. The Bill seeks to do away with the Central
Governments responsibility of being a financial guarantor to the central
warehousing corporation.

Accordingly, provisos to certain sections relating to the governments responsibility of

being a guarantor to the central warehousing corporation are proposed to be omitted
THE
INSURANCE
LAWS
(AMENDMENT)
ACT, 2015

An Act further to amend the Insurance Act, 1938 and the General Insurance Business
(Nationalisation) Act, 1972 and to amend the Insurance Regulatory and Development
Authority Act, 1999.

(i) a paid-up equity capital of rupees one hundred crore, in case of a person carrying on the
business of life insurance or general insurance; or
(ii) a paid-up equity capital of rupees one hundred crore, in case of a person carrying on
exclusively the business of health insurance; or
(iii) a paid-up equity capital of rupees two hundred crore, in case of a person carrying on
exclusively the business as a re-insurer:
The Insurance Regulatory Development Authority(IRDA) will get more teeth once the
insurance reforms begin to attract more foreign funds in the sector. The regulator, for
instance, will have more powers to levy higher penalty, impose a ceiling on expense
management, and fix remuneration for agents.
Insurance companies will not be allowed to repudiate claims after three policy years. The
Bill has amended Section 45 to state that no policy can be repudiated for any reason after
three years of commencement of risk/date of reinstatement/date of issuance.

The Regional
Rural Banks
(Amendment)
Bill, 2014
The Bill seeks to
amend the
Regional Rural
Banks Act, 1976.

The Regional Rural Banks Act, 1976 mainly provides for the incorporation, regulation and
winding up of Regional Rural Banks (RRBs).

Sponsor banks: The Act provides for RRBs to be sponsored by banks. These
sponsor banks are required to (i) subscribe to the share capital of RRBs, (ii) train
their personnel, and (iii) provide managerial and financial assistance for the first
five years. The Bill removes the five year limit, thus allowing such assistance to
continue beyond this duration.

Authorised capital: The Act provides for the authorised capital of each RRB to be
Rs five crore. It does not permit the authorised capital to be reduced below Rs 25
lakh. The Bill seeks to raise the amount of authorised capital to Rs 2,000 crore
and states that it cannot be reduced below Rs one crore.

Issued capital: The Act allows the central government to specify the capital issued
by a RRB, between Rs 25 lakh and Rs one crore. The Bill requires that the capital
issued should be at least Rs one crore
Shareholding: The Act mandates that of the capital issued by a RRB, 50% shall be
held by the central government, 15% by the concerned state government and 35%
by the sponsor bank. The Bill allows RRBs to raise their capital from sources
other than the central and state governments, and sponsor banks. In such a case,
the combined shareholding of the central government and the sponsor bank cannot
be less than 51%. Additionally, if the shareholding of the state government in the
RRB is reduced below 15%, the central government would have to consult the
concerned state government
The Bill states that the central government may by notification raise or reduce the limit of
shareholding of the central government, state government or the sponsor bank in the RRB.
In doing so, the central government may consult the state government and the sponsor
bank. The central government is required to consult the concerned state government when
reducing the limit of shareholding of the state government in the RRB
Board of directors: The Act specifies the composition of the Board of Directors of
the RRB to include a Chairman and directors to be appointed through the central
government, NABARD, sponsor bank, Reserve Bank of India, etc. The Bill states
that any person who is a director of an RRB is not eligible to be on the Board of
Directors of another RRB.
Financial changed from Previous December to March 31.
Board of Directors from (2 years) to 3 years. Maximum of 6 years.

The Companies (Amendment)

Bill 2014
The Bill introduces certain
amendments in relation to
Related Party Transactions,
fraud reporting by auditors,
making common seal
optional, and jurisdiction of
special courts to try certain
offences etc. The Statement
of Objects and Reasons of the
Bill states that this is to
ensure ease of business

Removal of minimum paid up share capital: The Act defines a

private company as one that is required to have a minimum paid-up
share capital of one lakh rupees or higher. A public company is
required to have a minimum paid up shared capital of five lakh rupees
or higher. The Bill removes the requirement of a minimum paid up
share capital amount for private and public companies.

Punishment for contraventions for acceptance of deposits from

the public: The Bill inserts a new provision which states that when a
company:
accepts, invites or allows another person to accept or invite on its
behalf any deposit which is in contravention to the provisions
specified in the Act or rules under it; or
fails to repay the deposit or any interest, either in part or whole,
within the time specified in the Act, or further time allotted by a
Tribunal, it shall be subject to certain penalties. The penalties
include:
A minimum fine of Rs one crore and a maximum of Rs 10 crore, in
addition to the deposit or interest that is due; and
Up to seven years imprisonment and fine between Rs 25 lakh to Rs
two crore, or both, for every defaulting officer of the company;
If proved that the defaulting officer of the company did so willfully,
he will be liable for the offence of fraud, under this Act.

Removal of requirement of a common seal: The Act states that a body

corporate would be required to have a common seal, from the date of
incorporation. The Bill deletes the requirement of a common seal throughout
the Act
No declarations for commencement of business, etc.: CA 2013
required all companies to file following additional declarations with
the Registrar of Companies prior to commencement of business or
exercising any borrowing power: (i) declaration by a director that

minimum paid-up share capital has been paid; and (ii) company has
filed verification of registered office.
The CA Amendment 2015 has removed the above requirements and
deleted Section 11 of CA 2013. This reduces the filings to be made by
companies in India.
By way of the above amendment, special
courts may now only try offences punishable under CA 2013, with
imprisonment for 2 years or more. All other offences are to be tried by a
Metropolitan Magistrate or a Judicial Magistrate of the First Class.

The Payment and Settlement

Systems (Amendment) Bill,
2014
The Bill amends the Payment
and Settlement Systems Act,
2007, which was enacted to
regulate and supervise
payment systems in India.
The Act designates the
Reserve Bank of India (RBI)
as the authority to regulate
such systems. These systems
include inter-bank transfers
such as the National
Electronics Funds Transfer
(NEFT) system, the Real
Time Gross Settlement
(RTGS) System, ATMs, credit
cards, etc.

The Bill seeks to extend the application of the Act to a designated

trade repository, or issuer, in relation to payment systems. In this
regard, it introduces three definitions:
Issuer: A person who issues a legal entity identifier or similar unique
identification, as specified by the RBI from time to time.
Legal entity identifier: A unique identity code assigned to a person
by an issuer to identify that person in such derivatives or financial
transactions, as specified by the RBI.
Trade repository: A person who is engaged in the business of
collecting, collating, storing, processing or disseminating electronic
records or data relating to such derivatives or financial transactions, as
specified by the RBI.
The Bill clarifies that the liquidator of the central counter party must:
(a) not reopen any determination that has become final and
irrevocable; (b) return the collaterals held in excess, after
appropriating the collaterals provided by the system participants
towards their settlement etc.

The Bill introduces a new provision which empowers the RBI to direct system
providers of a payment system to ensure protection of funds collected from
customers. To this end, system providers must: (i) deposit in a separate bank
account; or (ii) maintain liquid assets of an amount equal to such percentage of
the amounts collected by the system provider from its customers and remaining
outstanding, as specified by the RBI
The bill seeks to improve the payment and settlement systems by increasing transparency and stability of Indian
financial market.
"If we have an obsolete financial system the world will not trust us to the level at which the world should, if we
have to relegate ourselves to a country whose financial system must have confidence in itself," Jaitley said.

The amendment to the Payment and Settlement Systems Act, 2007, was proposed to update the regulations in
line with globally accepted standards.
The amendment seeks to protect funds collected from the customers by the payment system providers and to
extend the Act to cover trade repository and legal entity identifier issuer. A Legal Entity Identifier is an unique
ID associated with a single corporate entity.
"The payment must reach you, even if some third party has a court order in his favour... The person you have
paid, it must reach him and if it does not reach him because of contingency, then the law must provide for a
settlement by the process of which it will reach him.
"This was a gap in the law and that gap is what we are trying to fill up," Jaitley said.
As per the proposed amendments, the decision of the Court, Tribunal or any authority will not impact the
settlement which had become final prior to the issuance of the order.

The Textile
Undertakings
(Nationalisation)
Laws (Amendment
and Validation)
Bill,

The Bill seeks to

amend the Sick
Textile
Undertaking
(Nationalisation)
Act, 1974 and the
Textile
Undertakings
(Nationalisation)
Act, 1995. These
Acts provide for
the nationalisation
of certain textile

The two Acts state that the right and title of the owner of a textile undertaking
will vest with the central government. Further, every textile undertaking that
vests with the central government will be transferred to and vest with NTC.

In 2011, the Supreme Court held that NTC must vacate land on which Toyo
Poddar Cotton Mills Limited, Mumbai, stood, as the lease-hold tenure had
expired.
NTC had argued that they need not vacate the premises as lease hold rights were
with the central government. The Maharashtra Rent Control Act, 1999, under
which NTC was asked to vacate the land, exempts land leased by the central
government.
According to the Statement of Objects and Reasons of the Bill, the Bills seeks to
clarify the vesting of lease-hold land with the central government, in order to
prevent the vacating of this land by NTC, at the expiry of the lease.

The Bill states that lease-hold rights of the textile undertakings will vest with the
central government, irrespective of the transfer and vesting of these undertakings
to NTC. These rights will be exercised by the NTC on behalf of the central
government. Further, no court may order the divestment of the property vested
with NTC by the central government.

undertakings, and
for their
management by the
National Textile
Corporation
(NTC). NTC is a
Central Public
Sector Enterprise
under the Ministry
of Textiles.

The Mines and Minerals

(Development and
Regulation) Amendment Bill,
2015 was introduced in Lok
Sabha on February 24, 2015.
The Bill amends the Mines
and Minerals (Development
and Regulation) Act, 1957

Court proceedings directing lease-hold land to be divested from NTC will not be
maintained or continued. Lease-hold rights over land will continue to be
exercised by NTC on behalf of the central government, as provided for by the
Bill.
The transfer of any property from NTC, through any order of a civil court or
other authority, which is not in keeping with either Act as amended by the Bill,
will be deemed void.
These new provisions will be applied retrospectively. Thus, these provisions
will be deemed to have been in force from the time that each Act was enacted.

The Mines and Minerals (Development and Regulation) Act, 1957

regulates the mining sector in India and specifies the requirement for
obtaining and granting mining leases for mining operations.
The Bill adds a new Fourth Schedule to the Act. It includes bauxite,
iron ore, limestone and manganese ore and are defined as notified
minerals. The central government may, by notification, amend this
Schedule.
The Bill creates a new category of mining license i.e. the prospecting licensecum-mining lease, which is a two stage-concession for the purpose of
undertaking prospecting operations (exploring or proving mineral deposits),
followed by mining operations
Maximum area for mining: Under the Act, a person could acquire one mining
lease for a maximum area of 10 sq km. However, for the development of any
mineral, the central government could permit the person to acquire one or more
licenses or leases covering additional area. The Bill amends this provision to
allow the central government to increase the area limits for mining, instead of
providing additional leases
Lease period: Under the Act, a mining lease was granted for a maximum of 30
years and a minimum of 20 years and could be renewed for a period not

exceeding 20 years. Under the Bill, the lease period for coal and lignite
remains unchanged. For all minerals other than coal, lignite and atomic
minerals, mining leases shall be granted for a period of 50 years. All mining
leases granted for such minerals before the Bill, shall be valid for 50 years. On
expiry of the lease, instead of being renewed, the leases shall be put up for
auction, as specified in the Act.

Lease extensions: The Bill specifies that any lease granted before the
commencement of the Bill, shall be extended: (i) up to March 31,
2030 for minerals used for captive purpose (specific end-use) and up
to March 31, 2020 for minerals used for other than captive purpose, or
(ii) till the completion of renewal period, or (iii) for a period of 50
years from the date of grant of such lease, whichever is later. This
provision shall not apply to mining leases for which renewal has been
rejected, granted, or lapsed.

Auction of notified and other minerals: The Bill states that state governments
shall grant mining leases and prospecting license-cum-mining leases for both
notified and other minerals. Prospecting license-cum-mining lease for notified
minerals shall be granted with the approval of central government. All leases
shall be granted through auction by competitive bidding, including e-auction.

Transfer of mineral concessions: The Bill states that the holder of a

mining lease or prospecting license-cum-mining lease may transfer
the lease to any eligible person, with the approval of the state
government, and as specified by the central government. If the state
government does not convey its approval within 90 days of receiving
the notice, the transfer shall be considered as approved. No transfer
shall take place if the state government communicates, in writing, that
the transferee is not eligible. Only mineral concessions granted
through auction will be allowed for transfer.

Institutions: The Bill provides for the creation of a District Mineral Foundation
(DMF) and a National Mineral Exploration Trust (NMET). The DMF is to be
established by the state government for the benefit of persons in districts
affected by mining related operations. The NMET shall be established by the
central government for regional and detailed mine exploration. Licensees and
lease holders shall pay the DMF an amount not more than one-third of the
royalty prescribed by the central government, and the NMET two percent of
royalty.
The Andhra Pradesh
Reorganisation Act, 2014
provides for bifurcation of
Andhra Pradesh into the
successor states of Andhra
Pradesh and Telangana.
Among other things, it
addresses the representation
of the states in Parliament,
separate Legislative

Legislative Council for successor states: The Act provides that two Legislative
Councils shall be constituted, one for Andhra Pradesh with up to 50 members,
and another for Telangana with up to 40 members. The Bill amends this
provision with regard to the Legislative Council of Andhra Pradesh to allow
for up to 58 members.
One third of total members must be elected by members of municipalities,
district boards and other local authorities, while one-twelfth members must be
elected by teachers in educational institutions in the state. In keeping with
requirements of the Constitution, the Act specifies the number of members
elected/nominated from each category with the total number of members in the
Andhra Pradesh Legislative Council as 50. The Bill makes consequential

Assemblies and Legislative

Councils for both states, role
of the Governor, revenue
distribution, distribution of
cash and credit balances,
management and
development of water
resources, and creation of
separate cadres for
administrative, police and
forest services.

changes to the Act in this regard because it seeks to increase the strength of the
Legislative Council to 58.
The Vidhan Parishad (or Legislative Council) is the upper house in
those states of India that have a for bicameral legislature. As of 2014, seven
(out of twenty-nine) states have a Legislative Council: Andhra
Pradesh, Bihar, Jammu and
Kashmir, Karnataka, Maharashtra,Telangana,and Uttar Pradesh.

One-third are elected by members of local bodies such as Municipal

Corporations, Municipalities, Gram Sabhas, Gram
Panchayats,Panchayat Samitis and Zila Parishads.
One-third are elected by members of Legislative Assemblies of the
State from among the persons who are not members of the Assembly.
One-twelfth are elected by persons who are graduates of three years'
standing residing in that state.
One-twelfth are elected by persons engaged for at least three years in
teaching in educational institutions within the state not lower
than secondary schools, including collegesand universities.
One-sixth are nominated by the Governor from persons having
knowledge or practical experience in fields such
as literature, science, arts, the co-operative movement andsocial
service.

The Act provides that 17 members shall be elected by members of

municipalities, district boards and other local authorities. The Bill changes this
to 20.
The Act provides that 17 members shall be elected by members of the state
Legislative Assembly. The Bill changes this to 20.
The Act provides that 6 members shall be nominated by the Governor. The
Bill changes this to 8.
The Act provides that: (i) 5 members shall be elected by persons residing in
the state who are graduates, and (ii) 5 members shall be elected by teachers in
educational institutions in the state. The Bill makes no changes to these
provisions.

The National Capital Territory of Delhi Laws (Special Provisions) Amendment Bill, 2014
The Act provides that no action will be taken till December 31, 2014 with respect to: (i) encroachment
or unauthorized development as of January 1, 2006, (ii) unauthorized colonies, village abadi areas that

existed on March 31, 2002 and where construction took place up till February 8, 2007, and (ii) other
areas as of February 8, 2007. The Bill extends this deadline to December 31, 2017.

The Repealing and Amending (Second) Bill, 2014 was introduced in the Lok Sabha on December 3,
2014 by the Minister of Law and Justice, Mr. D.V. Sadananda Gowda.
According to the Statement of Objects and Reasons, the Bill is a periodic measure for updating the list
of laws in force. The enactments addressed in the Bill have either ceased to be in force, have become
obsolete or their retention as separate Acts is unnecessary.
In all, the Bill seeks to repeal 90 laws and pass amendments to two laws.
Repealing certain laws: The Bill repeals certain laws that have been listed in the First Schedule of the
Bill. Of the 90 Acts, 88 are being repealed entirely. As they are amendment Acts, the changes have
been incorporated into the principal Acts.
Amendment of certain laws: The Bill amends some provisions of two Acts, the Railways
(Amendment) Act, 2008 and the Indian Maritime University Act, 2008. These rectify typographical
errors in both Acts.

Repealing certain laws: The Bill repeals certain laws that have been listed in the First Schedule of the
Bill. Of the 36 Acts, four Acts are being repealed entirely. These include The Indian Fisheries Act,
1897, The Foreign Jurisdiction Act, 1947, The Sugar Undertakings (Taking Over of Management) Act,
1978 and The Employment of Manual Scavengers and Construction of Dry Latrines (Prohibition) Act,
1993.
The remaining 32 Acts that are being repealed are amendment Acts. The changes have been
incorporated into the principal Acts.
Amendment of certain laws: The Bill amends some provisions of The Prohibition of Manual
Scavengers Act, 2013, and The Whistle Blowers Protection Act, 2011. These rectify typographical and
certain patent errors, like the year of enactment respectively.
The Delhi High Court (Amendment) Bill, 2014 was introduced in Rajya Sabha on February 17, 2014
by the Minister of Law and Justice, Mr. Kapil Sibal. The Bill amends the Delhi High Court Act, 1966.
The Bill increases pecuniary jurisdiction of the high court of Delhi. Pecuniary jurisdiction refers to the
jurisdiction of a court over a suit based on the amount or value of its subject matter. Thus, the Delhi
high court will now have jurisdiction over suits which are above the value of Rs two crore. The Act
placed the value at Rs 20 lakh.
Consequently, the Bill empowers the Chief Justice of the Delhi High Court to transfer any pending suit
to a relevant subordinate court.
(e) designated trade means any trade or occupation or any subject field in engineering or non-engineering or
technology or any vocational course which the Central Government, after consultation with the Central
Apprenticeship Council, may, by notification in the Official Gazette, specify as a designated trade for the
purposes of this Act;
( j) graduate or technician apprentice means an apprentice who holds, or is undergoing training in order that
he may hold a degree or diploma in engineering or non-engineering or technology or equivalent qualification
granted by any institution recognised by the Government and undergoes apprenticeship training in any
designated trade;
(k) industry means any industry or business in which any trade, occupation or subject field in engineering or
non-engineering or technology or any vocational course may be specified as a designated trade or optional trade
or both;; (l), the following clauses shall be inserted, namely: (II) optional trade means any trade or
occupation or any subject field in engineering or non-engineering or technology or any vocational course as
may be determined by the employer for the purposes of this Act;
(III) portal-site means a website of the Central Government for exchange of information under this Act;
(q) trade apprentice means an apprentice who undergoes apprenticeship training in any designated trade;

(r) worker means any person working in the premises of the employer, who is employed for wages in any kind
of work either directly or through any agency including a contractor and who gets his wages directly or
indirectly from the employer but shall not include an apprentice referred to in clause