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News Alert: Notification issued by Ministry of Corporate Affairs (MCA) and Reserve Bank of India (RBI)

December 03, 2020

Latest notification issued by Ministry of Corporate Affairs (MCA) and Reserve Bank of India (RBI)

News from the desk of Ministry of Corporate Affairs (MCA)

Every Cost Auditor appointed under the provisions of Section 148 of the Companies Act, 2013 read with Companies (Cost records and Audit) Rules, 2014, is required to prepare and issue a Cost Audit Report in e-form CRA-3 to the Board of Directors of a Company on which Cost audit is applicable, within a period of 180 days from the end of relevant financial year i.e. on or before 30th day of September of relevant year.

Further, every Company on which Cost Audit is applicable needs to file Cost Audit Report in e-form CRA-4 with the Central Government within a period of 30 days of receipt of Cost Audit Report from a Cost Auditor.

Due to the outbreak of Covid-19 pandemic, the stipulated date of 30th day of September for the financial year 2019-20 was extended to 30th day of November, 2020 vide MCA’s  General Circular No. 29/2020 dated 10th September, 2020. Upon receipt of several representations from various stakeholders seeking further extension of the last date of filing of e- form CRA-4 (attaching the Cost Audit Report). MCA had further extended the last date of submission of Cost Audit Report by the Cost Auditor to the Board of Directors of a Company from 30th day of November, 2020 to 31st day of December, 2020.

Accordingly, the stipulated period of 30 days of filing of e-form CRA-4 by the Company with the Central Government shall be reckoned from 31st day of December, 2020. actual date of issuance of the Cost Audit report, whichever is earlier.

The complete text of the notification may be viewed at below link:

http://www.mca.gov.in/Ministry/pdf/GeneralCircularNo.38_01122020.pdfNews from the desk of Reserve Bank of India (RBI)

Reserve Bank of India had, with a view to bring clarity had issued advisory instructions to the Authorized Dealer Banks to not to issue any fresh permissions and/or renewal to any foreign law firm for opening of Liaison Office in India till the policy is reviewed based on, among others, final disposal of the matter by the Hon’ble Supreme Court of India.

The Hon’ble Supreme Court of India has while disposing of the case, held that advocates enrolled under the Advocates Act, 1961 alone are entitled to practice law in India and that foreign law firms/companies or foreign lawyers cannot practice profession of law in India. As such, foreign law firms/companies or foreign lawyers or any other person resident outside India, are not permitted to establish any branch office, project office, liaison office or other place of business in India for the purpose of practicing legal profession.

Accordingly, AD Category – I banks are directed not to grant any approval to any branch office, project office, liaison office or other place of business in India under FEMA for the purpose of practicing legal profession in India. Further, they shall bring to the notice of the Reserve Bank in case any such violation of the provisions of the Advocates Act comes to their notice. The Master Direction - Establishment of Branch Office (BO)/ Liaison Office (LO)/ Project Office (PO) or any other place of business in India by foreign entities is being updated to incorporate the contents of the said circular.

The said circular RBI/2020-21/69 A.P. (DIR Series) Circular No. 07 has been notified on November, 23, 2020.

The complete text of the notification may be viewed at below link:

https://rbidocs.rbi.org.in/rdocs/notification/PDFs/APDIR0798DFFED77933459F8FEDF0E4754D20B2.PDF

Last updated: 2/12/2020

Article contributed by:

Luv Malhotra

Senior Manager

MBG Corporate Services

 

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