Investment Law

Typically, a joint venture is a contractual agreement, between two or more parties, for a common commercial purpose. The concerned parties agree to share markets, profits, intellectual property, assets and knowledge for the new business venture. Further, the concerned parties own the shares of the joint venture company in prior agreed proportion. Formations of joint ventures in India are governed by company law.

Indian legal news brings you the latest updates about the new rule proposed by the Reserve Bank of India. The apex bank has said that banks shall fix their individual rates of interests for savings deposits. The RBI has also favored the deregulation of interest rates for agriculture sector, EXIM and savings account. Such deregulation is intended to encourage more financial inclusion.

For the latest directions from the Reserve Bank of India on the issuance of Non- Convertible Debentures (NCDs) of original or initial maturity up to one year, please click here.

[The directions have been compiled and shared with us, courtesy S DHANAPAL & ASSOCIATES, Chennai.]

In Mumbai, on June 8, 2010, the Insurance Regulatory and Development Authority (IRDA) canceled the licenses of 4,261 corporate agencies. The agencies were engaged in selling general/life insurance products. Are you wondering why such a staggering number of agencies were cancelled out of the blue? The authority is reported to have done so because their licenses needed to be renewed since March 31, 2010.

J. Hari Narayan, the chairman of the IRDA, said, “The agencies did not come for renewal and their licenses have been withdrawn.”  The IRDA has even cautioned insurers and general public as to avoid having insurance transactions with them.

Every member of a company whose name is mentioned in the company’s Register of Members is entitled to receive a share certificate or certificate share. Share certificates acts as an evidence for the shares of a shareholder in the company. The certificates of shares shall bear the company seal, the amount paid, the name of the shareholder, and must specify the related shares. It shall also bear the signatures of minimum of two directors and the company secretary.

The Indian housing industry abounds in real estate companies of all sorts, big, small and new. Since there is no regulatory authority to check their functioning, investors are often duped into unreliable transactions by attractive sales strategies and marketing techniques. Disputes related to the escalation of costs, delay in completion of projects, absence of clearance certificates, and non-inclusion of costs for fittings are quite common.

Online trading can be defined as the performance of trading activities, such as buying or selling financial securities, currencies and commodities, on the Internet. The foremost requirement for successful online trading is to be patient and use the apt software.

Brokers are not directly involved in the Internet-based investment practice, with most online trading portals providing opportunities for trade with the biggest stock houses, such as NSE and BSE. The total turnover of the online trading industry has shown remarkable growth from a mere 3 percent in 2003-04 to 16 percent in 2006-07.

An assessee is typically taxed on his/her own income. In certain cases an assessee may have to pay a tax on income that is legally earned by someone else, generally a family member or a dependant. Initially, taxpayers took undue advantage of this provision by transferring their assets to a family member with a lower income, helping to reduce the overall tax liability. The clause for clubbing of income was added in the Income Tax Act, 1961, in sections 60 to 64, to avoid such practices of tax evasion or avoidance.

In India, the Income Tax Act, 1961 requires every individual, with an annual income over the minimum exemption limit, to file Income Tax Returns (ITR).  An ITR is basically a document that contains a breakdown of different sources of income, which includes your salary, dividend income and income from house property. Income tax deductions, if applicable, are also claimed with the ITR. The structure of an income tax return differs for different assessees.