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POLITICAL AND LEGALENVIRONMENTOF INDIATHE Changingdimension AND ITSIMPACT ON BUSINESS
PRESENTED BY:SIMRAT HUNDAL
SMITA SHARMASONAM CHAWLA
SUDHIR
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POLITICAL LEGAL ENVIRONMENTIt refers to the influence exerted by
the three political institutions - The Legislature
The Executive
The Judiciary
in shaping, directing, developing and
controlling business activities.
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There is today no country with a stable and
honest Government that does not have or has
not had a reasonably satisfactory state ofeconomic progress.
- John Kenneth Galbraith
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TAXES
VOLUNTARYPROGRAMMES
INFORMATION
CONTRACTS
GOVT. SERVICE
POLITICAL
ACTIVITY
LAW AND ORDER
INSPECTION AND
LICENCES
MONEY AND CREDIT
COMPETITION
GROWTH
TARIFFS AND QUOTAS
INFRASTRUCTURE
INFORMATION
SMALL INDUSTRIES
TECHNOLOGY
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POLITICAL ENVIRONMENT IN INDIA With a population over 1 billion, India is the largest democracy in
the world.
It is a federal republic, consisting of 28 states and 7 unionterritories.
The Indian Parliament consists of two houses: Upper House orRajya Sabha and Lower House or Lok Sabha.
250 members are elected to the Rajya Sabha. Of the 250, 238members represent states and union territories.The Presidentnominates the remaining 12 members.
On the whole, 545 members are elected to the Lok Sabha. Theusual term of the Lok Sabha is five years.
Major power centers in India are: Congress (I) party, BharatiyaJanata Party, Communist parties, Labor, and Military.
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COALITIONGOVERNMENTS AND ECONOMICREFORMS
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CONGRESS (June 1991-May1996)
Unleashed economic liberalization Abolition of license quota raj
Rationalization of import duties and tariffs
Streamlining procedures for FDI approvals
Encouraging foreign direct investment
Opening up of Indias equity markets to
investment by foreign institutionalinvestors
GDP(CAGR%) :- 6.4%
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UNITED FRONT (June
1996-March 1998)Tax reforms
Voluntary Disclosureof Income Schemes
GDP(CAGR%) :- 5.1%
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NDA (March 1998-May 2004)
Telecom Reforms
Financial Sector reforms Power Sector reforms
National Highway DevelopmentProgram (NHDP)
PPP for infrastructure development Disinvestment in select PSUs
GDP(CAGR%) :- 6.2%
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UPA (May 2004-April 2009)
Administrative Reform
Implementation of VAT The move to implement Goods and Services
Tax (GST) from March 2010
Power Sector Reforms
NREGA
SEZ notification to boost export intensiveindustries
Turnaround in the financial health of IndianRailways
GDP(CAGR%) :- 8.2%
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UPA (May 2009-present)
Tax reforms
Financial reforms Peoples ownership of PSUs
FDI regime simplified
Introduction of Companies Bill,2009
Poverty eradication goal by 2014-15 Strengthening transparency and public
accountability
GDP(CAGR%) :- 7.2%
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TOP 5 STATES IN TERMS OF SHARE
IN INDIAS GDP
1. Maharashtra
2. Uttar Pradesh
3. Andhra Pradesh 40% of Indias4. West Bengal GDP
5. Gujarat
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[video]
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INDUSTRIAL POLICYOFINDIA
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The term Industrial Policy refers to the
governments policy towards industries-their
establishment, functioning, growth andmanagement.
The policy indicates the respective areas of
the large, medium and small-scale sectors.
The industrial development of a country is
shaped, guided, fostered, regulated and
controlled by its industrial policy. No legal sanction
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RATIONALE Correct the imbalances in the development of
industries
Direct the flow of scarce resources
Prevent the wasteful use of scarce resources
Empower the government
Demarcate areas among the public, privateand joint sectors of the economy.
Prevent the formation of monopolies
Give guidelines for importing foreign capital
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INDUSTRIAL POLICIES Industrial policy resolution of 1948 Industrial policy resolution of1956
Industrial policy statement of 1973
Industrial policy statement of 1977
Industrial policy statement of 1980
The New Industrial policy of 1991
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INDUSTRIAL POLICY 1948Issued by government of India on April 6, 1948
Laid stress on role of state in development of industry
Main features
Acceptance of the dual sectors : public and private
Division of industries1. Industries where state had a monopoly
2. Mixed sector
3. Field of government control
4. Field of private enterprise Role of small and cottage industries
Role of foreign capital was recognized
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INDUSTRIAL POLICY 1956Issued on April 30, 1956
Objectives To accelerate the rate of economic growth and to
speed up industrialization
To expand the public sector
To prevent creation of monopolies
To reduce existing disparities of income and wealth
To build up a large and growing private sector
To expand the village, cottage and small scaleindustries
To achieve balanced industrial development
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The Industrial Policy Resolution of 1956 gave
the broad policy framework of industrial
development in India.
Classification of industries under 3 heads
1. Schedule A exclusive responsibility of the state
(17 industries)
2. Schedule B progressively state owned
(12 industries)
3. Schedule C private sector
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INDUSTRIAL POLICY 1991Issued by the government of India headed by Mr.
P.V.Narasimha Rao on July 24, 1991.Objectives
Encouragement to Indian entrepreneurship
promotion of productivity and employmentgeneration
Development of indigenous technology
Incentives for industrialization of backward areas
Enhanced support to small-scale sector Protect the interests of workers
To link Indian economy to global market
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Dimensions
Abolition of Industrial Licensing
Foreign Investment
Foreign Technology Agreements
Public Sector Policy
MRTP Act
Exclusive small sector policy
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INDUSTRIAL POLICY 2009Main features
Objectives of the Industrial Policy of the Government are to maintain a sustained growth in productivity;
to enhance gainful employment;
to achieve optimal utilisation of human resources;
to attain international competitiveness and to transform India into a major partner and player in the
global arena.
Policy focus is on
Deregulating Indian industry;
Allowing the industry freedom and flexibility in respondingto market forces and
Providing a policy regime that facilitates and fosters growthof Indian industry.
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Policy measures
Liberalisation of Industrial Licensing Policy
Six industries under compulsory licensing
Three industries reserved for public sector
Introduction of Industrial Entrepreneurs
Memorandum(IEM)
Industries not requiring compulsory licensing are
to file an Industrial Entrepreneurs Memorandum
(IEM) to the Secretariat for Industrial Assistance(SIA)
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Contd
Liberalisation of the Locational Policy No industrial approval required from the Government
for locations not falling within 25 kms of theperiphery of cities having a population of more thanone million
Non-polluting industries such as electronics,
computer software and printing can be located within25 kms of the periphery of cities with more than onemillion population.
Policy for Small Scale Industries
industrial undertakings with an investment uptorupees one crore are within the small scale andancillary sector
21 items reserved for manufacture in the small scalesector
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Non-Resident Indians Scheme The general policy and facilities for Foreign Direct
Investment as available to foreign investors/company are
fully applicable to NRIs as well
Electronic Hardware Technology Park
(EHTP)/Software Technology Park (STP) scheme For building up strong electronics industry and with a view
to enhancing export
the inputs are allowed to be procured free of duties
Policy for Foreign Direct Investment (FDI)
liberal and transparent foreign investment regime wheremost activities are opened to foreign investment on
automatic route without any limit on the extent of foreign
ownership
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Monetary Policy
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Monetary policy determines the supply of currency in the
economy. Through it the RBI targets a key set of indicators
to ensure price stability in the economy.
Through the supply of money, monetary policy regulates:
Interest rates
Inflation.
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The monetary policy stance for 2009-10 has been to maintain
a monetary and interest rate regime consistent with pricestability and financial stability, and supportive of the growth
process.
Cash reserve ratio: 5.75 % Reverse Repo rate: 3.25 %
Repo rate: 4.75 %
Statutory Liquidity ratio: 25 %
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Fiscal Policy
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Fiscal policy is the statement of governments source ofincome and its expenditure.
It is concerned with raising revenues and deciding on thelevel and pattern of expenditure. Fiscal policy influences thedecisive forces of economics- demand, supply, disposableincome of the people, savings rate etc. Fiscal policyoperates through budget.
Budget is an estimate of government expenditure andrevenue for the ensuing financial year. It is presented toParliament on the last working day of February by theFinance Minister in the name of the President of India.
Ocassionally, in times of financial crisis, an interim budgetmay be introduced later in the year to increase taxation andexpenditure.
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Budget 2010-2011
The tax break for IT industry has not been extended.(expires inMar 2011)
Rise in MAT( minimum alternative tax) to 18% will increase
tax liability for leading infra ,IT and telecom companies
including Bharti Airtel, TCS, Idea Cellular. Corporate surcharge cut to 7.5%.
Tax holiday to new hotels till they start making profits.
Increased weighted deduction of upto 200% for R&D
companies will shift focus from generic business to high enddrug discovery and innovation.
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The Fiscal Responsibility and Budget
Management (FRBM) Bill
The Committee on Fiscal Responsibility Legislation was
constituted on January 17, 2000 to recommend a draft
legislation on fiscal responsibility of the government.
The Fiscal Responsibility and Budget Management (FRBM)
Bill was introduced in Lok Sabha in December 2000 .
The FRBM bill was passed by the UPA government in July
2004.
Objective :
To legally bind the government with the responsibility to adopt
a prudent fiscal policy and pave the way for accomplishing
macro economic stability.
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The original bill aimed at: Reducing revenue deficit
by an amount equivalent to
0.5% of GDP at end of each
financial year and Reduction in fiscal deficit
by an amount equivalent to
0.5% of GDP at end of each
financial year.
Central government shall
not borrow from the RBI.
Bill seen as undemocratic.
Denied freedom to future
governments in terms of
fiscal management.
Modified version of the billwas passed in 2004.
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The FRBM legislation provides for :
Quarterly review of fiscal situation.
Regulating borrowing from the RBI in a bid to check
borrowing and control expenditure for fiscal discipline.
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Foreign Trade Policy
The Foreign trade/Export Import Policy is announced after
every five years by Ministry of Commerce and Industry.
EXIM policy aims at developing export potential, improving
export performance, encouraging foreign trade and creating
favorable balance of payments position.
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Current status
Exports turned positive inNov. 2009 after 13months of continuous fall,
Registered a growth of 9.4% in Dec. 2009 owing tostrong growth inpharmaceuticals, autocomponents, chemicals,engineering .
SEZs registered a growthof 50% with total exportsof Rs.1,51,785 crores.
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Foreign trade Development and Regulation Act
In India, the main legislation concerning foreign trade is the
Foreign Trade Development and Regulation Act, 1992.
The Act provides for the development and regulation of foreign
trade by facilitating imports into, and augmenting exports fromIndia .
As per the provisions of the Act, the Government :-
may make provisions for facilitating and controlling foreign
trade; may prohibit, restrict and regulate exports and imports, in all
or specified cases as well as subject them to exemptions;
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Cntd.
is authorised to formulate and announce an export and importpolicy and also amend the same from time to time, by
notification in the Official Gazette;
is also authorised to appoint a 'Director General of ForeignTrade' for the purpose of the Act, including formulation and
implementation of the export-import policy.
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Objectives of current FTP 2009-14 (27 AUG 2009) releasedby Ministry of Commerce and Industry are :
to arrest and reverse the declining trend of exports and
to provide additional support especially to those sectors whichhave been hit badly by recession
to achieve an annual export growth of 15% with an annual
export target of US$ 200 billion by March 2011.
The long term policy objective for the Government is todouble Indias share in global trade by 2020.
POLICY MEASURES
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POLICY MEASURES
Promote Brand India through six or more Made in India
shows to be organized across the world every year. Comprehensive Economic Partnership Agreement with
South Korea which will give enhanced market access to Indian
exports.
26 new markets have been added under Focus MarketScheme. These include 16 new markets in Latin America and
10 in Asia-Oceania. The incentives available under Focus
Market Scheme (FMS) has been raised from 2.5% to 3%.
Continuation of the DEPB Scheme upto December 2010. Continuation of income tax benefits for IT industry and
100% export oriented units for one additional year till
31st March 2011.
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The incentive available under Focus Product Scheme(FPS) has been raised from 1.25% to 2%. Products added to
this scheme include agricultural machinery, parts of trailers,
sewing machines, hand tools, garden tools, musical
instruments, clocks and watches.
Introduction of a common simplified application form to
take benefits under FPS, FMS, MLFPS .
Jaipur, Srinagar and Anantnag have been recognised as
Towns of Export Excellence for handicrafts; Kanpur,
Dewas and Ambur have been recognised as Towns of
Export Excellence for leather products; and Malihabad for
horticultural products.
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Review of the FTP on Jan 29, 2010:
112 new products eligible for benefit under FPS including
rubber, plastic, chemicals.
113 new products eligible for benefit of 5 % under special FPS
, include pumps, nuts and bolts, agricultural tools etc. Timor Leste added as new FMS country and 2 new markets ,
China and Japan added under Market Linked Focus Product
Scheme.
Sesame seeds and coconut products added under VisheshKrishi and Gram Udyog Yojana.
EXIM TIMES, JAN 16-31
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FOREIGN EXCHANGEMANAGEMENT ACT.
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FEMA
Passed by the Lok Sabha in 1999 and came into force with effect
from June 2000.
FEMA, which has replaced FERA, had become the need of the
hour since FERA had become incompatible with the pro-liberalisation policies of the government.
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Preamble
An Act to simplify, consolidate and amend the law relating toforeign exchange with the objective of :
1. Facilitating external trade and payments and ,
2. For promoting the orderly development and maintenance of
foreign exchange markets in India.
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PROVISIONS.
Current account transaction.
Any person may sell or draw foreign exchange to or from anauthorised person if such sale or drawl is a current accounttransaction.
Capital account transaction.
Any person may sell or draw foreign exchange to or from anauthorised person for a capital account transaction.
Exports of goods and services.
Every exporters of goods or services shall furnish to the Reserve
Bank details regarding the export value of such goods or services. Contravention
Penalty up to thrice the sum involved in such contravention wheresuch amount is quantifiable, or up to two lac rupees where theamount is not quantifiable.
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*LAND ACQUISITION
* ENVIRONMENT PROTECTION ACT
* MRTP ACT and COMPETITION
ACT,2002
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* Also there is a considerable difference between the market
value of the property and the value that the land acquisition
company pays the land owners.
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* The left parties would raise a demand to scrap the archaic land
acquisition act,1894, as it facilitated land acquisition by big
Corporates, who took advantage of the acute distress of farmers,
communist party of India (Marxist) Polit bureau member Brinda
Karat said. (22 Feb, 2010.)
* She said the demand to scrap the law and allot land to the landless
and homeless would be raised at a rally called by left parties in New
Delhi on march 12.
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* Indias total known reserves are 18 billion tonnes, of which 4.5
billion Tonnes are in Orissa and the state government plans to give 1
billion Tonnes to POSCO of which 400 MT will be exported to Korea.* A community led struggle emerged in the Orissa almost three
years ago (June 2005). The agitation, which continues till today is
against the forcible take over of lands and resources.
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* About 50% of the families are also
involved in pisciculture (mostly prawns),
for which the daily earnings per family canrange between Rs. 100-5000 ($2.50-$125).
* In addition, there are many landless
families that depend on ancillary
employment like making baskets for
packaging paan leaves grown in the area.
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* Water extraction in these
quantities will also lay additional
stress on an already overloaded
water system, imposing a threat
on water security for the locals,
in addition to concerns about
water pollution.
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* The people of Orissa are not against industry but they want
the company should address the demands of the local people.
Betel vine farmers should be properly compensated.
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* The law has provisions for state taking over
privately held land for public purposes but not
for developing private businesses. The illegalityof the acquisition has been substantially
conceded by the Kolkata high court.
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* This lead to the protest ofthe peasants backed by the political
parties of opposition, who thought it would be a good opportunity
to end the communist rule of Bengal.
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* A housing and industrial boom isgathering momentum on the
outskirts ofAhmedabad city.
* Among the industries coming upin Sanand are Avtec Ltd., Durr India
Pvt. Ltd., Rajkot- based Amul
Industries and Bosch India.
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Land acquisition process, in the recent times, has emerged as amajor bottleneck resulting in time lags, cost over runs, businessuncertainties and even shelving of projects by companies.
1. Firstly, the buyer of property is required to establish the chainof title in respect of the property for the preceding 30 years inorder to obtain a clear and marketable title in respect of property.Typically, a title search exercise, for a mid-sized project takes atleast 2-3 months. Thus, establishing the chain oftitle, obviously, istime consuming, expensive and complex resulting in huge projectdelays.
2. Secondly , under the seventh schedule of the Constitution ofIndia, all matters relating to land are a subject matter of the StateGovernment. Accordingly, each state has enacted its own legislationin relation to land, registration, stamping and development thereon.Further, there are often disconnects between the state laws and the
central laws.
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compensation package tofarmers, rehabilitation of
farmers, fertility of land. Infact,
most often companies prefer to
interact with the farmersthrough the Government as
intermediary or other
middlemen and avoid direct
interaction with the locals.
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* In this Act,
Environment includes water , air and land and the interrelationship
which exists among and between water, air and land, and human
beings, other living creatures, plants, micro-organism and property.
* Environmental pollutant means any solid, liquid or gaseous
substance present in such concentrations as may be, or tend to be
injurious to environment.
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offence was committed, was directly in charge
of, and was responsible to, the company for the
conduct of the business of the company, as well
as the company, shall be deemed to be guilty of
the offence and shall be liable to be proceeded
against and punished accordingly.
http://images.google.com/imgres?imgurl=http://www.wondercliparts.com/holidays/environment_day/environment_day_graphics_02.gif&imgrefurl=http://www.wondercliparts.com/holidays/environment_day/environment_day_clipart.html&usg=__HB99bJl-dY4RgfuH7mIemasVzUo=&h=450&w=450&sz=23&hl=en&start=14&itbs=1&tbnid=4zSGWE8jsm-ZIM:&tbnh=127&tbnw=127&prev=/images?q=environment&hl=en&gbv=2&tbs=isch:1http://images.google.com/imgres?imgurl=http://www.wondercliparts.com/holidays/environment_day/environment_day_graphics_02.gif&imgrefurl=http://www.wondercliparts.com/holidays/environment_day/environment_day_clipart.html&usg=__HB99bJl-dY4RgfuH7mIemasVzUo=&h=450&w=450&sz=23&hl=en&start=14&itbs=1&tbnid=4zSGWE8jsm-ZIM:&tbnh=127&tbnw=127&prev=/images?q=environment&hl=en&gbv=2&tbs=isch:1http://images.google.com/imgres?imgurl=http://www.wondercliparts.com/holidays/environment_day/environment_day_graphics_02.gif&imgrefurl=http://www.wondercliparts.com/holidays/environment_day/environment_day_clipart.html&usg=__HB99bJl-dY4RgfuH7mIemasVzUo=&h=450&w=450&sz=23&hl=en&start=14&itbs=1&tbnid=4zSGWE8jsm-ZIM:&tbnh=127&tbnw=127&prev=/images?q=environment&hl=en&gbv=2&tbs=isch:1 -
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* Also there are two cement plants owned by M/s. Jay Pee AtRewa In Madhya Pradesh M/s. Jay Pee Bela Cement Plant were
found to be marginally exceeding the emission standards for
which Madhya Pradesh State Pollution Control Board was asked
to take corrective action.
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* Even India's second largest cement company ACC
ltd's two plants have been issued environment
violation directions.
The company has several awards to its credit for its
achievement in environment awareness andprotection including the Golden Peacock
Environment Management special award and Subh
Karan Sarawagi Environment Award to name a few.
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THE OBJECTIVE OF THE ACT BEFORE 1991:
* Regulation of monopolies and prevention of concentrationof economic power.
* Prohibit monopolistic, restrictive and unfair trade practices.
THE OBJECTIVE OF THE ACT AFTER 1991:
* Controlling monopolistic trade practices
* Regulating restrictive and unfair trade practices.
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* From the beginning of 1990 there was a shift in the focus from
regulating monopolies to promoting competition. Competition ,if encouraged , would improve productivity and increase quality
benefitting consumers. The Competition Act precisely seeks to
achieve this.
* The MRTP Act had become redundant post July 1991 when thenew economic policy was announced
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new economic policy was announced
* Hence in October 1999 Government Of India appointed a high
level committee known as RAGHVAN COMMITTEECommittee presented its report in May 2000 & based on this
report draft was presented to government in November, 2000.
This act was enacted by Parliament in 53rd year of Republic of
India & was passed in December, 2002 namely called asCOMPETTITION ACT 2002.
* The Ministry Of Corporate Affairs, Government Of India
issued a notification dated 28th August 2009, whereby theMonopolies And Restrictive Trade Practices Act, 1969 (The MRTP
Act) stands replaced by the Competition Act, 2002, with effect
from September 1, 2009.
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OBJECTIVE OF COMPETITION ACT:
* The Competition Act seeks to provide, keeping in view of theeconomic development of the country, for the establishment of a
commission to prevent practices having adverse effect on
competition, to promote and sustain competition in markets, to
protect the interests of consumers and to ensure freedom of trade.* This Act seeks to establish Competition Commission of
India(CCI). Any person, consumer, consumers association, trade
association, a state government or Central government may lodge
a complaint with the Commission.
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* Transfer Of Pending CasesUpon the expiry of two years from 1
September 2009, cases pending before the
MRTP commission will be transferred as
follows:-
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Sections 5 and 6 that deal with combinations, mergers andacquisitions are yet to be notified.
This has resulted in ambiguity and confusion as there were
effectively two independent statutes, the MRTP act and the
competition act having concurrent jurisdiction. This has led to the
uneasy coexistence of two regulators without reconciled powers
and functions, the MRTP commission and Competition
Commission Of India (CCI).
* Advisable to put a clause that closing of the transaction would
be subject to any clearance of CCI.
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Functions Societies Registration Act 1860 Partnership Act 1932
Companies ( Donation to National ) Fund Act 1951 Companies Act, 1956 The Companies Amendment Act, 2006 The Monopolies and Restrictive Trade Practices
Act, 1969
The Competition Act, 2002 The Chartered Accountants Act, 1949 Cost and Works Accountants Act, 1959 The Company Secretaries Act, 1980
Limited Liability Partnership Act, 2008
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Recent initiatives Introduction of the Companies Bill, 2009
Limited Liability Partnership Act, 2008
Indian Institute of Corporate Affairs, May 2008,
Gurgaon Amendments (2006) in the Chartered Accountants
Acts, 1949, the Cost and Work Accountants Acts,1959 and the Company Secretaries Acts, 1980
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Most important piece oflegislation governing CorporateIndia
It covers almost everything from,
birth to Grave of a Company 658 Sections, 13 schedules, 32
rules, 107 forms
Several guidelines & hundreds of
clarifications given time to time Objectives
Promotes Sec. 38-39 of the VI ofthe Constitution of India.
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1. What is Its Purpose2. Salient Features
New Companies Act will be the thematic law for thisdecade
Insider trading becomes a criminal offence Consolidated financial statements of subsidiaries made
mandatory
recognition of cross-border mergers
Provision for single forum for approval of mergers andacquisitions
minimum number of independent directors to beappointed in listed companies should be one-third of thetotal number of directors
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Appointment of valuers is proposed to be made by an
audit committee or in its absence by the board ofdirectors.
Shareholders associations or group of shareholdersare to be enabled to take legal action in case of anyfraudulent action on the part of a company
Clause that disallows claims over unclaimed dividendafter seven years removed
The Investor Education and Protection Fund (IEPF) isto be administered by a statutory authority.
Role of independent directors clearly defined Process for formation of companies simplified
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3. Company Bill for more powers to Govt inprobing offences
4. Accounting norm changes to be incorporated innew Company Act
5. The National Company Law Tribunal
6. Rules to be made stringent for filing class action
suits
7. Company to separate posts of Chairman andCEO
8. Knowledge test soon to assess company directors
9. Two sets of accounting standards under companyAct
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Why LLP Acts, 2008
Salient Features
A hybrid between a limited liability company and a
partnership firm Able to form multi-disciplinary partnerships.
Flexibility of operations as board/general andextraordinary general meetings are not required to be
conducted. Business can be expanded depending upon the
increases in the area of operations.
Limited procedural formalities.
89
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The Liability of an LLP is met out of the property of theLLP; the partner is not liable.
A partner is not responsible for the wrongful act oromission of any other partner
No collective responsibility for every action of the LLP.
The control of the Registrar of Companies on LLPs wouldbe substantial.
The Centre would have enormous rule-making powerunder the Act as there are 33 specific matters under sub-
section (2) of Section 72 of the Act,
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The Bill does not provide for conversion/re-conversion ofLLPs into firms/private companies and unlistedcompanies.
Financial disclosures may act as a deterrent for formationof LLPs
Lack of ceiling on the maximum number of partners maymake LLPs unmanageable
Fines/penalties/prosecutions and imprisonment providedfor in the Act may prove a major irritant for forming LLPs.
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Est. May 2008 Manesar, Gurgaon
Purpose
A global first in concept and design
Re-inventing & repositioning MCA Fill Institutional vacuum
Ministrys think-tank
Futuristic in vision and approach
Global Collaboration- Governance and EconomicGrowth
Powerful global KMS
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Income Tax Act 19611. Direct Tax e.g. Personal tax,
corporate tax, wealth,inheritance tax
2. Indirect Taxes e.g. Excise,custom, sales, VAT
Proposed Tax Reforms
GST planned to be implementedfrom April 2011
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What is the justification forGST?
What is GST? How does itwork?
Salient Features of theproposed GST
1. The Reform entails a dualGST
2. Uniform state GST
threshold3. Rate structure
4. Multiple statutes
5. Tax Administration
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How will GST benefit industry, trade andagriculture ? comprehensive and wider coverage of input tax set-off
and service tax set-off
subsuming of several Central and State taxes in the GSTand phasing out of CST
may also lead to lowering of tax burden on an averagedealer in industry, trade and agriculture.
How will GST benefit the exporters? reduce the cost of locally manufactured goods and services
increase the competitiveness of Indian goods andservices
reducing the compliance cost.
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How will GST benefit the small entrepreneursand small traders?
raising of threshold will protect the interest of small
traders
How will GST benefit the common consumers? Goods will become cheaper under GST
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Mutually agreements-protection and enforcements
an agreement enforceable by law is a contract
An agreement not enforceable by law is said to be
void Essentials of Valid Contract
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Ministry of corporate Affairs, www.mca.gov.in Business Line, www.thehindubusinessline.com
Indian Institute of corporate Affairs,www.primedirectors.com
Economic & Political weekly, Dec, 2009 Vol. XLIV No.51
Economic & Political weekly, Jan 2, 2009 Vol. XLV No.1
The Institute of Company Secretaries of India(ICSI)www.icsi.edu
Institute of Chartered Accountants of India, www.icai.org The Companies Act, 1956
The Contract Act, 1872
Limited Liability Partnership Acts, 2008
Contd
http://www.icai.org/http://www.icai.org/http://www.icai.org/http://www.icai.org/http://www.icai.org/http://www.icai.org/http://74.125.153.132/search?q=cache:xkxIciwcxHsJ:stoposco.wordpress.com/posco-project-in-orissa/+land+acquisition+act+and+posco&cd=2&hl=en&ct=clnk&gl=inhttp://74.125.153.132/search?q=cache:xkxIciwcxHsJ:stoposco.wordpress.com/posco-project-in-orissa/+land+acquisition+act+and+posco&cd=2&hl=en&ct=clnk&gl=in -
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stoposco.wordpress.com/posco-project-in-orissa/ - Cached
en.wikipedia.org/wiki/Tata_Nano _Singur_controversy - Cached
Similar www.pib.nic.in/release/release.asp?relid=57499
envfor.nic.in/legis/legis.html
www.deccanchronicle.com Hyderabad- Cached
www.legalserviceindia.com/articles/neew.htm - Cached - Similar www.lawyersclubindia.com/.../COMPETITION-ACT-2002.../2501/ -
Cached
Essentials of Business Environment by: K. Aswathappa
Business Environment by : Francis Cherunilum
The HINDU (22/2/2010)
Business Standard (2/2/2010)
Business India(February7,2010)
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