Blog Posts
-
The Resurgence of Securitization and CDS
[Posted by Umakanth Varottil] The concepts of securitization and credit default swaps (CDS) have acquired a negative connotation over the last couple of years since they were said to have triggered the global financial crisis during the second half of 2007. More, importantly, the assets involved were sub-prime loans that underwent a process of disintermediation…
-
Financial Crisis, Economics and Regulation
[Posted by Umakanth Varottil] There is a recent assortment of interesting columns regarding the financial crisis, the role that regulation (or the lack thereof) has played in the exacerbation of the crisis, and the various economic instruments utilized by policy makers to rein in the crisis. The following is a list of these readings: 1.…
-
Scope of Deductions under the Income Tax Act
[Posted by Shantanu Naravane] Two recent decisions of the Income tax Appellate Tribunals have provided important guidelines on the scope of the deductions under the Income Tax Act. One deal with what expenditures cannot be deducted on grounds of being ‘prohibited by law’, and the other dealt with the extent to which foreseeable losses could…
-
Amendments to DIP Guidelines: Rights Issues and IDRs
[Posted by Umakanth Varottil] SEBI today issued amendments to the SEBI (Disclosure and Investor Protection) Guidelines, 2000 with a view to simplifying the process for a rights issue. Since listed companies embarking on a rights issue are already subject to the disclosure norms under the listing agreement, substantial information regarding such companies are already available…
-
Merits of a Financial Services Appellate Tribunal
[Posted by Umakanth Varottil] (The following column by Somasekhar Sundaresan appeared in today’s Business Standard) Newspapers have recently reported that a proposal has been mooted in government to convert the Securities Appellate Tribunal (SAT) into a “Financial Services Appellate Tribunal” to hear grievances against orders passed by various sub-sectoral regulators. Currently, the SAT hears appeals…
-
Moore Stephens: Extending Protection for Auditors
[Posted by Mihir Naniwadekar] Moore Stephens v. Stone & Rolls might well be the most important case on auditors’ liability since Caparo v. Dickman . The House of Lords, by a narrow majority, extended the protection which Caparo offers to auditors even further. The facts, as detailed by Lord Phillips, were that the sole “directing…
-
Contracts of Sale, Works Contracts, and TDS
[Posted by V. Niranjan] Tax deducted at source (TDS) has proved to be a controversial area of law for quite some time now. One issue that has most recently come to light is likely to have enormous commercial significance – under what circumstances is a company obliged to treat an ordinary transaction as a “works…
-
Is levy of penalty mandatory for Securities Laws’ violations?
[Posted by Jayant Thakur] – Decoding the decision of the Supreme Court in Shriram’s case 1. Is levy of penalty for violation of securities laws mandatory? Is there no discretion to the Adjudicating Officer on whether or not to levy penalty? Are adjudication proceedings a mere formality? Is intention to commit the violation totally irrelevant?…
-
SEBI issues circular to formalise clarifications on 5% additional creeping acquisition
[Posted by Jayant Thakur] I had briefly written in an earlier post of a report in CNBC/moneycontrol.com of certain “clarifications” in respect of the amendments to Regulation 11(2) of the SEBI Takeover Regulations. As may be recollected, the amendments permitted acquisition of further shares upto 5% for persons who held shares between 55-75%. This press…