Repayment of Government of India Floating Rate Bonds (FRB) 2016

         Repayment of Government of India Floating Rate Bonds (FRB) 2016

The outstanding balance of Government of India-Floating Rate Bonds 2016 is repayable at par on May 07, 2016. No interest will accrue there-on from the said dates. In the event of a holiday being declared on May 07, 2016 by any State Government under the Negotiable Instruments Act, 1881, the Loan/s will be repaid by the paying offices in that State on the previous working day.

As per sub-regulations 24 (2) and 24(3) of Government Securities Regulations, 2007 payment of maturity proceeds to the registered holder of Government Securities held in the form of Subsidiary General Ledger or Constituent Subsidiary General Ledger account or Stock Certificate shall be made by pay order incorporating the relevant particulars of his bank account or by credit to the account of the holder in any bank having facility of receipt of funds through electronic means. For the purpose of making payment in respect of the securities, the original subscriber or the subsequent holders of such Government Securities, shall submit the relevant particulars of their bank account well in advance.

However, in the absence of relevant particulars of bank account / mandate for receipt of funds through electronic means, to facilitate repayment of the Loan on the due date, holders may tender the securities, duly discharged, at the Public Debt Offices, Treasuries / Sub-Treasuries and branches of State Bank of India and its Associate Banks (at which they are enfaced / registered for payment of interest) 20 days in advance of the due date for repayment.

Full details of the procedure for receiving the discharge value may be obtained from any of the aforesaid paying offices. 


As a measure towards improving the ease of doing business, procedure for Establishment of Branch Office (BO)/Liaison Office (LO)/Project Offices (PO) in India by Foreign entities simplified
As a measure towards improving the ease of doing business, it has now been decided that except for a few sectors viz. Defence, Telecom, Private Security, Information and Broadcasting and Non-government organization and except a few countries, the power to grant approvals for establishment of Branch Office (BO)/Liaison Office (LO)/Project Offices (PO) in India by foreign entities, would be delegated to the Authorised Dealers Category-I Banks. Further, anyone who has been awarded a contract for a project by a Government authority/PSU would be automatically given approval to open a bank account.

Regulations in this regard have been notified by RBI vide G.S.R. 384 dated March 31, 2016.

Earlier these entities used to seek the approval of Reserve Bank of India (RBI) before setting-up their BO/LO/PO office in India. While Reserve Bank of India (RBI) gives permission in those cases where 100% FDI is allowed under automatic route, all other cases are referred to the Government for approval.

The establishment of Branch Office (BO)/Liaison Office (LO)/Project Offices (PO) in India by foreign entities is regulated in terms of FEMA 22/2000-RB dated May 3, 2000, as amended from time to time. The foreign entities can set-up their BO/LO/PO in India without registering themselves as companies/trusts etc. under Indian Laws.


Simplification of procedure to deal with audit objections raised in indirect taxes by the office of by CAG
Central Board of Excise and Customs (CBEC) has issued a circular to simplify the procedure of dealing with audit objections raised in indirect taxes by the office of CAG. The Circular rescinds all the past circulars and instructions and prescribes a new simplified and consolidated procedure. The Circular No. is 1023/11/2016 CX dated 08/04/2016

Taking note of the fact that revenue and audit have agreement on large proportion of the audit objections, the revised Circular provides that demand notice, in cases of agreement on audit objection, should be issued and decided expeditiously. However, where revenue does not agree with the objections, no demand notice would be issued. Thus, where it is not necessary, an assessee would not be taken through the litigation cycle.

The Circular also highlights that adjudicating authority is a quasi-judicial authority and is expected to decide the case independently and judiciously. Regular coordination meeting between Revenue and CAG officers has also been prescribed for faster resolution of issues.
These revised guidelines have been issued in an effort to make the indirect tax administration assessee friendly and non-adversarial by bringing the audit objections to closure in an expeditious and fairer manner. 

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