Blog Posts
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United States Supreme Court considers a corporation’s ‘principal place of business’
An important question, with significant implications for contemporary corporate law theory will be heard by the United States Supreme Court on November 10. The matter in question is Hertz Corp. V. Friend (08-1107), which poses the question of which State can be considered to be a corporation’s ‘principal place of business’. The issue has arisen…
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Changing Advertising Practices in India – The End of “Puffery”?
The Government’s proposed “Advertising Code” for food and health products is an interesting development , particularly in light of developments in India over the past three years or so on the subject. This blog has discussed emerging trends in India on the norms governing advertising practices. To briefly recapitulate, the law does not proscribe comparative…
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Powers of SEBI and SEC Compared
In his column in the Business Standard this week, our guest contributor Somasekhar Sundaresan argues that, if one were to go by the rule book, SEBI has greater powers than the SEC. He lists out several significant powers of SEBI that can be exercised without intervention of the court. Here are some excerpts: Take the…
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‘Business connection’, ‘Attribution’ and the withdrawal of Circular 23 of 1969
Through Circular No. 7 of 2009, the CBDT has withdrawn Circular No. 23 of 1969 (“Circular 23”). Circular 23 explained the position relating to ‘business connection’ under Section 9 of the Income Tax Act, 1961. The Circular was relied upon in the arguments in the Morgan Stanley case before the Supreme Court; as also by…
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A Reiteration of Separate Legal Entity
A recent decision of the Punjab and Haryana High Court in CIT v. Panchratan Hotels has re-emphasised the notion of separate legal entity, albeit in the context of the law of taxation. Here, the assessee was Panchratan Hotels, and had declared losses for the said assessment year. On 31.7.1992, the shareholders of the company had…
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Supreme Court Reaffirms Dharmendra Textiles
Earlier posts here have considered the issue of whether the penalty under section 271(1)(c) of the Income Tax Act, 1961 is a criminal, quasi-criminal or civil liability, which in turn has implications on whether mens rea is needed for awarding penalty under the section. The Supreme Court had held in Dilip Shroff that mens rea…
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RBI extends time limit for Auditors’ Certificate for NBFCs – leaves fundamental issues unaddressed
Auditors of non-banking financial companies (NBFCs) have to submit a certificate every year to the Reserve Bank of India on whether the NBFC is engaged in the business of a non-banking financial institution (NBFI). The certificate also gives the income/asset pattern for making it eligible for classification under various categories. The last date for submission…
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Corporate Bonds: Clearing and Settlement
SEBI last week issued a circular prescribing the procedure for clearing and settlement of corporate bonds. This is an important step in the development of a robust corporate bond market that has not yet fully evolved in India, and appears to have been welcomed by the markets. The SEBI Updates blog has a post describing…
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Much Ado About Executive Compensation
Over the last few weeks, significant attention has been drawn to the issue of executive compensation, following observations by the Minister for Corporate Affairs that there ought to be moderation in CEO salaries in India. Two factors seem to have triggered such attention. One, which carries political overtones, is the Government’s own measure of austerity.…
