Ergo Update

Section 50 of the Central Goods and Services Tax Act 2017 (CGST Act) was amended1 to provide that the interest on tax payable in respect of supplies made during a tax period and declared in the return for the relevant period furnished after the due date, except after commencement of any proceedings under section 73 or section 74 of the CGST Act in respect of the said period, shall be levied on that portion of the tax that is paid by debiting the electronic cash ledger.

On 13 August 2020, the Reserve Bank of India (RBI) issued the “Review of Guidelines for Core Investment Companies” (Review Guidelines) incorporating majority of the recommendations from the report of the Working Group to Review the Regulatory and Supervisory Framework for Core Investment Companies (CICs) published on 6 November 2019 (Report).

On 5 August 2020, the Kerala High Court (High Court), in its decision in MP Varghese v Annamma Yacob & Ors (MFA No 47/2020) (MP Varghese Case), explained with considerable clarity the procedural mechanism to lift an encumbrance from an immovable property under Section 57 of the Transfer of Property Act 1882 (TPA), which provision has till date been rarely espoused in reported judgments in India.

In the ongoing dispute between the Oswal family in relation to nomination of the shares of Oswal Agro Mills Limited, the Supreme Court has set aside the order of the National Company Law Appellate Tribunal (NCLAT).

Global trends towards a stakeholder-centric governance model have resulted in a structured movement towards responsible business conduct. Companies are expected to be driven not only by profitability but also the increasingly relevant non-financial parameters measured through impact on society and the environment, popularly referred to as the ‘triple bottom line’.

In continuation of Reserve Bank of India’s (RBI) efforts to ease financial stress caused by the Covid-19 pandemic, the RBI issued the circular on the Resolution Framework for Covid-19 Related Stress dated 6 August 2020 (August 6 Circular). The August 6 Circular creates a limited time window for certain categories of borrowers affected by Covid-19 pandemic related business disruption to be allowed resolution plans in the nature of restructuring while permitting the borrower accounts to retain their status as ‘standard’.

Ministry of Power, Government of India, vide its order dated 5 August 2020 has waived inter-state transmission (ISTS) charges and losses on transmission of electricity generated from solar and wind projects, for sale to entities, till 30 June 2023. This waiver is applicable to power plants using solar and wind sources of energy, including solar-wind hybrid power plants.

Hon’ble Prime Minister (PM) Mr Narendra Modi launched a ‘Transparent Taxation’ platform on 13 August 2020 comprising faceless assessments, faceless appeals and a taxpayer’s charter (Charter) enumerating responsibilities of the income-tax department towards taxpayers and also listing down duties of the taxpayers towards the income-tax department.

A three-judge bench of the Supreme Court delivered a landmark ruling which has put to rest a long-standing debate on the applicability of the amendment to the Hindu Succession Act 1956 (HSA) in respect of  the rights of a female Hindu in joint family property.

On 6 August 2020, the Reserve Bank of India (RBI) issued its statement on developmental and regulatory policies inter alia setting out measures to deepen digital payments. The RBI acknowledged the significant increase in the number of disputes and grievances in the digital payments space, and recognised the need for technology-driven redressal mechanisms (which are rule-based and automated) to resolve such disputes effectively and expeditiously.