GST E-Invoicing Mandatory for Suppliers with turnover exceeding 50 Crores
The Ministry of Finance (Department of Revenue) has released a notification dated March 08, 2021 mandating GST Electronic Invoicing System for taxable Suppliers with turnover more than INR 50 Crores. The present notification has been issued further amending the Ministry’s notification March 21, 2020 which made GST E-invoicing mandatory for suppliers with turnover more than INR 100 Crores.
ANALYSIS OF THE INFORMATION TECHNOLOGY (INTERMEDIARY GUIDELINES AND DIGITAL MEDIA ETHICS CODE) RULES, 2021
On February 25, 2021, the Ministry of Information, Government of India enacted the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021(hereinafter referred to as IT Rules, 2021 for the sake of brevity).With reference to the Rules, the Government has issued an official statement stating that “Amidst growing concerns around lack of transparency.
INDIA: PLI SCHEME FOR IT HARDWARE.
In a recent development, as reported by the Hindustan Times, the Maharashtra Real Estate Regulatory Authority (MahaRERA) vide its order dated July 30, 2020 in the case of Mr. Deepesh S Singh and ors vs. M/s. Neelkanth Constructions..
Financial Assistance for setting up Bulk Drug Parks under PLI.
The Union Government has recently approved Production Linked Incentive Scheme for Pharmaceuticals over a period of Financial Year 2020-21 to 2028-29. The Scheme is expected to benefit domestic manufacturers, help in creating employment and also contribute to the availability of wider range of affordable medicines for consumers in India.
Guidelines on BIS Certification for Footwear Manufacturers- India.
Bureau of Indian Standards (BIS) has in furtherance to the Quality control orders covering footwear made from rubber/polymeric material, leather and other material, has recently notified a clarification to facilitate the footwear manufacturers.
India: Trans Fat Elimination by 2022- FSSAI.
The Food Safety and Standards Authority of India (FSSAI) has limited the industrial trans fatty acids vide and amendment to the Food Safety and Standards (Prohibition and Restriction on Sales) Regulations.
INITIATION OF CIRP BY OPERATIONAL CREDITOR.
When the Corporate Debtor defaults in making payments to its creditors the process of Corporate Insolvency Resolution Process (CIRP) can be initiated against it by its creditors. The Insolvency and Bankruptcy Code, 2016 (hereafter “the Code”) provides the process for insolvency resolution process (IRP).
Fraudulent Websites offering Low Cost Trademark Filings Revealed!!
An alarming incident has been reported involving websites engaged in fraudulent and low cost trademark filings. It has been reported that the incident is one of the biggest money laundering case of Pakistan. Investigation revealed that an entity, namely, Diagnostics Labs operated almost 200 fraudulent websites and also issued fake USPTO trademark registration certificates while luring customers with low cost trademark filings.
GST E-Invoicing Mandatory for Suppliers with turnover exceeding 50 Crores
The Ministry of Finance (Department of Revenue) has released a notification dated March 08, 2021 mandating GST Electronic Invoicing System for taxable Suppliers with turnover more than INR 50 Crores[1]. The present notification has been issued further amending the Ministry’s notification March 21, 2020 which made GST E-invoicing mandatory for suppliers with turnover more than INR 100 Crores[2].
Thus, the GST E-invoicing has been made mandatory by the Government for suppliers having aggregate turnover exceeding from earlier stipulated amount of INR 100 Crores to INR 50 crores. The same shall be effective from April 1, 2021.
As per the amendment, the notified class of registered persons have to prepare invoice by uploading specified particulars of invoice (in FORM GST INV-01) on Invoice Registration Portal (IRP) and obtain an Invoice Reference Number (IRN).
Any registered person other than those referred in following rules whose:
| Erstwhile Notification -13th March 2020 | New Notification-21st March, 2021 |
| Aggregate Turnover exceeds
INR 100 Crores |
Aggregate Turnover exceeds
INR 50 Crore |
The eligible tax suppliers can practice E-invoicing only after an Invoice Reference Number (IRN) has been procured by them. The same can be obtained by filling out all relevant information and details as required in FORM GST-INV-01, available on Common Goods and Services Tax Portal at www.gst.gov.in.
EXCEPTIONS FOR TAXABLE SUPPLIERS
The abovementioned notifications shall be applicable to all taxable suppliers except from:
| Rule 54(2) | Insurer or banking company or financial institution (including non-banking financial company) |
| Rule 54(3) | Goods Transport Agency supplying services through transportation of goods by road in a goods carriage |
| Rule 54(4) | Passenger Transport Service |
| Rule 54(4A) | Services permitting admission or exhibition of cinematograph films in multiplex screens |
Conclusion
Allegedly many businesses have been engaging in tax evasions, tax leakages and other tax related frauds since decades. Owing to ever-increasing frauds, the practice of E-invoicing is being promoted by Ministries across the world. One-time reporting of invoices provides real-time access to both, the Authorities as well as the buyers may combat the malafide practices of tax evasion in India.
To enhance the purview, the Government of India vide this notification has reduced the requisite turnover from INR 100 crores to INR 50 crores. This legislative change shall enable additional thousands of firms and suppliers to practice E-invoicing, thereby eventually benefitting both, the business and the customers.
[1] https://www.cbic.gov.in/resources//htdocs-cbec/gst/notfctn-05-central-tax-english-2021.pdf
ANALYSIS OF THE INFORMATION TECHNOLOGY (INTERMEDIARY GUIDELINES AND DIGITAL MEDIA ETHICS CODE) RULES, 2021
By Lucy Rana and Priya Adlakha
On February 25, 2021, the Ministry of Information, Government of India enacted the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021[1] (hereinafter referred to as IT Rules, 2021 for the sake of brevity). With reference to the Rules, the Government has issued an official statement stating that “Amidst growing concerns around lack of transparency, accountability and rights of users related to digital media and after elaborate consultation with the public and stakeholders, the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules 2021 has been framed in exercise of powers under section 87 (2) of the Information Technology Act, 2000 and in supersession of the earlier Information Technology (Intermediary Guidelines) Rules 2011.”[2]
According to the information released by The Press Information Bureau, there are 530 MillionWhatsApp users in India. While there are 448 Million users of YouTube and there are 410 Million as well as 210 Million, Facebook and Instagram users, respectively.[3] Social Media today has not been just a mode of entertainment but it has evolved into an arena for trade and commerce activities as well. It has also upheld the basic criteria of transmission of information and it has also accommodated a space for people to freely express their views as well as opinions.
Social Media Control- How to Bell the Cat!!
The lockdown and corona phase in India provided the country with a threshold and introduced one to the stark reality of their reliance over social media platforms. The deliberations clearly bring to the dawn that the reliance of people on social media is highly treacherous as there is a high possibility of its misuse at this juncture. In the recent years, there has been a rampant use of social media to abuse women[4] and to even infringe with people’s privacy.[5] There had been a devoir of a specific mandate which restrained the abusers or the misusers of social media. In such circumstances, the absence of a robust complaint mechanism wherein the ordinary users of social media and OTT (over-the-top) platforms could register their complaint and get their grievances redressed within defined timeline further aggravated the victim’s helplessness. It was also found that usually the social media platforms are supposed to work as intermediaries but more often than not, they adopted to the role of publishers or editors of information.[6]
IT Rules, 2021- Key Provisions
The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 appears to have resolved these issues. The IT Rules, 2021 have divided the social media intermediaries into two categories. The two categories are as follows:
- Social media intermediary[7]
- Significant social media intermediary[8]
Due Diligence by Intermediaries
Rule 4 of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 deliberates upon the aspect of the due diligence that is to be followed by the intermediaries. It also enunciates with regard to the umbrella of the safe harbor provisions that are articulated under the Section 79 of The Information Technology Act, 2000.[9]
Display of Privacy Policy and Usage of Personal Data- Rule 4 entails that the intermediary is under an obligation to prominently publish on his website or application, or both (as the case maybe), the privacy policy and the usage of personal data or information for its users.[10] Furthermore, the privacy policy or user agreement should be drafted in such a way so that it embraces that the user is under the obligation not to host, display, upload, modify, publish, transmit, store, update or share any information which is derogatory to the rules of the society or unethical or defamatory to the general public or misleads the general public.[11] Any information which so harms the dignity of a person would be covered within the ambit of this specific provision.
Information under unity, integrity and sovereignty of the State– Any information that is so under the unity, integrity and sovereignty of the state would not be entertained as per the specific provision. Furthermore, the intermediaries are under the obligation to notify the users that in case such an unethical information is transmitted, then it would call for either termination of their account or removal of the information that is not in conformity with the user agreement or privacy policy.[12]
Removal of Unethical Information- The intermediary is also to be diligent that if it comes to its notice that any information that is transmitted on its portals that is so enunciated above, then the intermediaries are to expeditiously remove such information as mentioned under Section 79(3) of Information Technology Rules, 2000.[13] Moreover, after removing such information, the intermediary is under an obligation to store the specific information for a period of one hundred and eighty days for the investigational purposes.[14]
Specify details of Grievance Redressal Mechanism- The intermediary is to publish on its website or application or both, as the case may be, the name of the Grievance Officer and his/her contact details as well as mechanism by which a user or a victim may make complaint against violation of the provisions of Rule 4 or other matters pertaining to the computer resources made available by it. Moreover, the Grievance Officer is under an obligation to acknowledge the complaint within three working days and resolve the same within one month from the receipt of the complaint.[15]
Removal of information portraying person in bad light, obscene acts- Furthermore, an intermediary is under the strict compulsion to remove an information within twenty-four hours on the complaint of a person which portrays such a person in bad light or exposes their private parts or shows such a person in a sexual act or nudity.[16] In regard to the aforementioned burden, a complaint can be filed by an individual or any person on his/her behalf.
Monthly Compliance Report- Subsequently, additional due diligence is to be observed by the significant social intermediaries as per the Rule 5 of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021. It enumerates upon the aspect of the appointment of Chief Compliance Officer, a Nodal Contact Person and a Resident Grievance Officer. It also adds that all of these officers should be resident of India. Mandatorily, there should be a publishing of a Monthly Compliance Report. The said report should contain the details of complaints received and action taken in pursuance of the said complaints as well as details of contents removed proactively. The physical presence of such an officer is highly imperative.
First Originator of Information- One of the most imperative aspect of the said Rules is with regard to the enablement of the identification of the ‘First Originator of Information’ as may be required by the order of the Court or a Competent Authority under the Section 69 of the Information Technology Act, 2000.
However, the issue that lies at this juncture is the unchartered possibility of the same since many intermediaries claim (especially WhatsApp), that the information shared by them is through an end-to-end encryption. The same is presently being determined by the through the case of Facebook Inc v. Union of India.[17] Initially, the case was filed for adjudication in the Madras High Court. Subsequently, technology giants like Facebook and YouTube were impleaded as parties in the case. Facebook later on approached the Supreme Court because the matter was sub-judice in a couple of other High Courts such as the Bombay High Court and the Madhya Pradesh High Court. The main argument made by Facebook / WhatsApp was that it uses end-to-end encryption which makes it impossible to track the originator of a message and that even WhatsApp does not have decryption keys and therefore, does not have access to the messages itself. The Supreme Court is currently adjudicating on the issue of how the intermediaries can trace the originators of a message shared on their respective platforms.
Voluntary User Verification-One of the intrinsic provision introduced in the IT Rules, 2021 is the ‘Voluntary User Verification.’[18] The users who wish to verify their accounts voluntarily shall be provided an appropriate mechanism to verify their accounts and provide with a demonstrable and visible mark of verification. However, there is an ongoing debate with regard to the whole ordeal of the user verification being only voluntary.[19]
Furthermore, any information that is posted by a user and contrary to the provisions of the IT Rules, 2021 must be removed. However, the user must be given an appropriate opportunity of being heard.[20]
Publishers of News in The Digital Media
The social media intermediaries are not all that are regulated through the enactment. The IT Rules, 2021 also endeavors to regulate the publishers of news in the digital media.[21] It works upon the grievance redressal for the same in three stages.[22] They are enunciated as follows:
The IT Rules, 2021 enunciate that the publishers of news in the Digital Media would be required to observe Norms of Journalistic Conduct of the Press Council of India and the Programme Code under the Cable Television Networks Regulation Act, 1995 thereby providing a level playing field between the offline (Print, TV) and digital media. It covers within its ambit the regulation of Foreign News Media.
There is also a deliberation upon the appointment of a Grievance Redressal Officer who is to address every grievance and resolve it within a period of 15 days. There isalso a requirement for constitution of a self-regulatory body which should be registered under the Ministry of Information and Broadcasting and oversee the adherence by the publisher to the Code of Ethics and address grievances that have not been resolved by the publisher within 15 days. Such a body is to be headed by a retired judge of the SC, a High Court or an independent eminent person and it should have not more than six members.[23]
IT Rules, 2021 and OTT Platforms
The IT Rules, 2021 have also endeavored to work upon the aspect of the OTT Platforms (such as Netflix, Amazon Prime and Disney+Hotstar).
Classification of Age groups and Parental Control
The OTT Platforms have to self-classify the content into five age groups. The age groups would be as U (Universal), U/A 7+, U/A 13+, U/A 16+, and A (Adult).[24]
The Code of Ethics also deliberates that the platforms would have to adhere to the age limit and even require parental control or locks for the appropriate ages. One of the most imperative points at this juncture is that the Rules talk about the AI Automated Censorship.
The new IT Rules, 2021 have been a welcome step which puts the users of the information and the intermediaries in the form of social media on the same platform. Social media platform can certainly be used for asking questions and criticism and therefore they are an imperative tool and should be used wisely. Social media platforms have empowered the ordinary users but they need accountability against its misuse and abuse. The new Rules empowers ordinary users of social media, embodying a mechanism for redressal and timely resolution of their grievance. The proposed framework is progressive, liberal and contemporaneous. It seeks to address peoples’ varied concerns while removing any misapprehension about curbing creativity and freedom of speech and expression.
The Rules at present are under the scanner and are being objected by several groups for being anti-democratic and taking away digital rights. The Rules though stringent will play a major role in evolving social media control mechanism in the coming days and also the enforcement action undertaken against violation of IT Rules, 2021 will determine the extent of social media misuse in India in future.
Related Posts
Intermediary Liability: SC says Intermediaries not Protected under Section 79 of IT Act
India: Intermediary’s Liability for Infringing Content
Intermediary Liability in India
E-Commerce Intermediary Liability
[2] https://pib.gov.in/PressReleseDetailm.aspx?PRID=1700749
[3] Government notifies Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules 2021, Ministry of Electronics & IT, Press Information Bureau, Government of India, (Updated on February 25, 2021). {https://pib.gov.in/PressReleseDetailm.aspx?PRID=1700749}
[4] Subhranshu Rout v. State of Odisha, 2020 SCC Ori 878.
[5] Selvi J. Jayalalithaa vs. Penguin Books India C.S. No. 326 of 2011) and Justice K.S. Puttaswamy v. Union of India (2017) 10 SCC 1.
[6] Facebook – Intermediary or Editor?, The Center for Communication Governance Blog, National Law University, Delhi, (Updated on December 9, 2016). {https://ccgnludelhi.wordpress.com/2016/12/09/facebook-intermediary-or-editor/}
[7] Rule 2(z) of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021- “means an intermediary referred to in clause (m) which primarily or solely enables online interaction between two or more users and allows them to create, upload, share, disseminate, modify or access information using its services but shall not include an intermediary which primarily, — i. enables commercial or business oriented transactions; or ii. provides access to internet or computer networks; or iii. is in the nature of a search-engine, on-line encyclopedia, online directory or suggestion tool, e-mail service or online storage service.”
[8] Rule 2(y) of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021- “means a social media with users above such threshold as may be notified by the Central Government”.
[9] Rule 3 of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[10] Rule 4(1) (a) of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[11] Rule 4(1) (b) of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[12] Rule 4(1) (c) of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[13] Rule 4(1) (d) of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[14] Rule 4(1) (g) of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[15] Rule 4(1) (n) of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[16] Rule 4(1) (p) of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[17] TP (C) 1943-46/2019 (Diary No.32478-2019).
[18] Rule 5 of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[19] Amit Chaturvedi, 3-stair mechanism for OTT platforms, monthly compliance reports: Big points from govt guidelines on social media, Hindustan Times, (Updated On February 25, 2021). {https://www.hindustantimes.com/india-news/big-points-from-govt-guidelines-to-curb-misuse-of-social-media-101614244488164.html}
[20] Rule 5 (1) (a) of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[21] Part III of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[22] Rule 8 of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[23] Rule 11 of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
[24] Schedule Part III of The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
INDIA: PLI SCHEME FOR IT HARDWARE.
By Lucy Rana and Rupin Chopra
The Government of India on February 24, 2021 announced approval of Rs 7,325 Crore under the PLI (Production Linked Incentive) Schemes for IT hardware such as laptops, tablets, all-in-one-personal computers, and servers.
Under the PLI Scheme, the Government has aimed to bring on board the five laptop and tablet manufacturing companies across the world to expand the existing units or setup new units.
The Current Demand of Laptop and Tablets are met in India through:
Imports valued-
- INR 29,470 Crores (USD 4.21Million)
- INR 2,870 Crores (USD 0.41 Billion)
The initiative of the Government has intended to reduce the dependence on the import of Laptop and IT Hardware.
Undeniably, in the past two decades, the demand for laptop and IT related hardware has increased substantially. The reports suggested that market for IT Hardware is dominated by 6-7 companies of the world and these companies to account for 70% of the world market share[1].
Statistics of PLI Scheme for Period of 4 Years (2021-2025)
The scheme has proposed the large scale electronics manufacturing of IT Hardware products, significantly increases USD 1 Trillion Digital Economy and USD 5 Trillion GDP by 2025. It includes further proposed benefits such as:
| S. No. | PLI Proposed Benefits | Benefits to be obtained |
| 1. | Net Incremental Sales | 4% to 1% of goods manufactured in India |
| 2. | Production | Rise of INR 3.26 Lakhs Crores of the Gross Manufacturing Giants |
| 3. | Exports | 75% rise in the exports from the order of INR 245,000 Crores |
| 4. | Revenue Rise | Rise of INR 15,760 Crore |
| 5. | Domestic Value Addition | Present-From 5%-10% to
Expected- 20%-25% |
| 6. | Increase in Job | 1.8 Lakh jobs to increase directly and indirectly |
This scheme will help in boosting the ranking of the country as a global hub of Electronic System and Manufacturing and will also bring the integration with the Global Value Chain.
Implications of PLI Scheme for Laptop Manufacturers
Companies all over the world are working towards expansion of their operations and manufacturing in different parts of the world. The benefits the Manufacturers under MSME associated will render as follows:
| S. No. | Benefits |
| 1. | Capital Linked Incentive Scheme– it subsidizes some percentage of investment. |
| 2. | Expenditure Linked Incentives- |
| a. | Tariff Subsidies-a trade subsidy to domestic manufacturer reduces the domestic cost of manufacture. |
| b. | Stamp Duty Reimbursement– a tax to the government for the sale or purchase on the specified instruments. |
| 3. | State Linked Incentives– |
| a.
|
SGST Reimbursement– it is the Goods Service tax benefit given to the manufacturer. |
| b. | Turnover Based Subsidy– a benefit over the net investment value. |
| 4. | Mega Units customized Incentives from States– a customized schemes by the respective states. |
| 5. | Duty Scrips from Foreign Trade Transactions-a duty credit scrip issued by the DGFT and used to pay for the taxes to CG. |
| 6. | Reduced Corporate Tax Rates |
- To position India as a global hub for Electronic System Design and Manufacturing (EDSM) as a vision of National Policy on Electronics 2019, notified on 25th Feb 2019.
- To increase capabilities in the country for developing core components such as chipsets.
- To make the MSME reach the Global standards.
Conclusion
These reports and statistics suggest that if such companies expands their operation in India, it will make India a major destination for manufacturing IT Hardware
The Production Linked Incentive scheme (PLI) aims to give incentives on incremental sales from the products manufactured in domestic units. The aim of the scheme is to promote and encourage the existing manufacturing units and expand employment opportunities in India. The Scheme has been floated is in consonance with Atmanirbhar Bharat Mission – a scheme for self-reliance.
As stated by the IT Ministry, PLI in simple terms aims at inviting the investors that come to India, invest, set up factory, manufacture, and export and earn incentives.
[1] https://pib.gov.in/PressReleasePage.aspx?PRID=1700432
Financial Assistance for setting up Bulk Drug Parks under PLI
The Union Government has recently approved Production Linked Incentive Scheme for Pharmaceuticals over a period of Financial Year 2020-21 to 2028-29. The Scheme is expected to benefit domestic manufacturers, help in creating employment and also contribute to the availability of wider range of affordable medicines for consumers in India[1].
It has been estimated that Indian Pharmaceutical society is the 3rd largest in the world. The worth of Pharmaceutical Industry in terms of value is 40 Billion and India contributes to almost 5% of total drugs and medicines exported globally[2].
Applicability of the PLI Scheme
The Scheme has mapped out the manufacturers of pharmaceutical goods registered in India on the basis of their GMR-Global Manufacturing Revenue.
The scheme has following criteria for the groups of applicants:
| S.No. | Target Group | GMR Value (F/Y 2019-2020) of Pharmaceutical Goods | Quantum of Incentive |
| 1. | Group A | More than or equal to 5000 Crores | Rs 11,000Crore |
| 2. | Group B | Between INR 500 Crores to INR 5000 Crores | Rs 2,250 Crore |
| 3. | Group C | Less than INR 500 Crores | Rs 1,750 Cr |
Category of Goods
The scheme shall cover pharmaceutical goods under three categories:
- Category 1
Biopharmaceutical, complex generic drugs, patented drugs or drugs nearing appetent expiry, cell based or gene therapy, orphan drugs, special emptycapsules like HPMC, Pullulan, enteric, complex excipients, other drugs as approved.
- Category 2
Active Pharmaceutical Ingredients/ Key Starting Materials/Drug Intermediaries
- Category 3
Repurposed drugs, Auto immune drugs, anti-cancer drugs, anti-diabetic drugs, anti-effective drugs, cardiovascular drugs, psychotropic drugs, and anti-retroviral drugs, in vitro-diagnostic devices and other approved drugs.
The scheme has proposed incentives of Rs 15, 000 Crores and the benefits from the categories are transferrable from Group A to Group C applicants.
Implications of Scheme
The scheme is aimed to be self-reliant for important drugs.
| S.No. | Proposed Benefits | Benefits |
| 1. | Rearrangement towards the development of complex and high tech-products in the fields of In-Vitro-Diagnostic Services. | Rs 15,000 Crores investment |
| 2. | Incremental Sales | Within 6 years (2022 to 2028)
Rs. 2,94,0000 Crores |
| 3. | Incremental Exports | Within 6 years (2022 to 2028)
Rs. 1,96,0000 Crores |
| 4. | Increase in Jobs | Directly 20,000 jobs and Indirectly by 80,000 jobs. |
Benefits to Pharmaceutical Manufacturer from the PLI Scheme
| S. No. | Benefits |
| 1. | Capital Linked Incentive Scheme– it subsidizes some percentage of investment. |
| 2. | Expenditure Linked Incentives- |
| a. | Tariff Subsidies-a trade subsidy to domestic manufacturer reduces the domestic cost of manufacture. |
| b. | Stamp Duty Reimbursement– a tax to the government for the sale or purchase on the specified instruments. |
| 3. | State Linked Incentives– |
| a.
|
SGST Reimbursement– it is the Goods Service tax benefit given to the manufacturer. |
| b. | Turnover Based Subsidy– a benefit over the net investment value. |
| 4. | Mega Units customized Incentives from States– a customized schemes by the respective states. |
| 5. | Duty Scrips from Foreign Trade Transactions-a duty credit scrip issued by the DGFT and used to pay for the taxes to CG. |
| 6. | Reduced Corporate Tax Rates |
For Category of Goods –Active Pharmaceutical Ingredients/ Key Starting Materials/Drug Intermediaries[5]
| Benefit Allowed | Percentage or Amount Allowed |
| Financial Assistance | 1. Financial assistance to a selected Bulk Drug Park would be 70% of the project cost of common infrastructure facilities.
2. In case of North Eastern States and Hilly States (Himachal Pradesh, Uttarakhand, Union Territory of Jammu & Kashmir and Union Territory of Ladakh) financial assistance would be 90% of the project cost. 3. Maximum assistance under the scheme for one Bulk Drug Park would be limited to Rs. 1000 crore |
| Common Infrastructure Facilities | The common facilities provided to individual bulk drug units in the Bulk Drug Park such as central effluent treatment plant, solvent recovery and distillation plant, steam generation and distribution system, common cooling system and distribution network, common logistics facilities, advance laboratory testing center, emergency response center, center of excellence etc. |
Conclusion
It is accounted that India Exports low generic drugs components. The large production of the drugs from the longest times have been met through the imports. It has been reported that Indian Pharmaceutical sector lacks necessary pharma R&D and high value production has never accomplished.
In order to enrapture, the global markets, our domestic players need to enhance productions in diversified product categories. The domestic market needs to be stimulated with the requisite funds and schemes for the high value goods such as bio-pharmaceuticals, complex generic drugs, patented drugs or drugs meeting patent expiry, or cell based or gene therapy.
The PLI Scheme floated by the Government for Pharmaceuticals is expected to promote the production of high value products in the country and increase value addition in the exports.
Related Posts
INDIA: PLI SCHEME FOR IT HARDWARE
PLI Scheme for Electronic Manufacturing
[1] https://pib.gov.in/PressReleasePage.aspx?PRID=1700433
[2] ibid
[4] https://www.ey.com/en_in/tax/india-tax-insights/how-production-linked-incentives-can-help-boost-india-manufacturing-sector
[5] https://pharmaceuticals.gov.in/sites/default/files/Gazettee%20notification%20of%20bulk%20drug%20schemes.pdf
Guidelines on BIS Certification for Footwear Manufacturers- India
By Lucy Rana and Rupin Chopra
Bureau of Indian Standards (BIS) has in furtherance to the Quality control orders covering footwear made from rubber/polymeric material, leather and other material, has recently notified a clarification to facilitate the footwear manufacturers.
In light of the above, please note that BIS is a national standard body of India which was earlier known as Indian Standards Institution until January 01, 1987.
- BIS (earlier known as ISI) was constituted for harmonious development of the activities of standardization, marking and quality certification of goods and for matters connected therewith or incidental thereto.
- One of the certification schemes introduced with an intent to ensure standardization in terms of quality and safety of products is the ISI mark scheme which is a ‘product certification scheme’.
- Under the ISI mark scheme, the manufacturers of different products especially those under the mandatory registration scheme are required to obtain registration from BIS authority.
- Once the registration is obtained, the manufacturers are required to affix ISI mark on their product as well as imprint the same on product packaging/ labelling.
- Since shoes come under ISI mark scheme it will be denoted by imprinted the IS mark with the registration
BIS Cerification for Footwear Products
BIS has introduced three Quality Control Orders on Footwear Products wherein the following Indian Standards were introduced:
| 1. | IS 5557: 2004 | Industrial and protective rubber knee and ankle boots |
| 2. | IS 5557 (Part 2): 2018 | All rubber gum boots and ankle boots |
| 3. | IS 5676: 1995 | Moulded solid rubber soles and heels |
| 4. | IS 6664: 1992 | Rubber microcellular sheets for soles and heels |
| 5. | IS 6719: 1972 | Solid PVC soles and heels |
| 6. | IS 6721: 1972 | PVC sandal |
| 7. | IS 10702: 1992 | Rubber Hawai Chappal |
| 8. | IS 11544: 1986 | Slipper, rubber |
| 9. | IS 12254: 1993 | Polyvinyl chloride(PVC) industrial boots |
| 10. | IS 16645: 2018 | Moulded plastics footwear- Lined or Unlined polyurethane boots for general industrial use |
| 11. | IS 16994: 2018 | Footwear for men and women for municipal scavenging work |
| 12. | IS 1989 (Part 1): 1986 | Leather safety boots and shoes for miners |
| 13. | IS 1989 (Part.2): 1986 | Leather safety boots and shoes for heavy metal industries |
| 14. | IS 3735: 1996 | Canvas Shoes Rubber Sole |
| 15. | IS 3736: 1995 | Canvas Boots Rubber Sole |
| 16. | IS 11226: 1993 | Leather safety footwear having direct moulded rubber sole |
| 17. | IS 14544: 1998 | Leather safety footwear with direct moulded polyvinyl chloride (PVC) sole |
| 18. | IS 15844: 2010 | Sports footwear |
| 19. | IS 17012: 2018 | High ankle tactical boots with PU – Rubber sole |
| 20. | IS 17037: 2018 | Antiriot shoes |
| 21. | IS 17043: 2018 | Derby shoes |
| 22. | IS 15298 (Part 2): 2016 | Personal protective equipment – Part 2 Safety Footwear |
| 23. | IS 15298 ( Part 3) : 2019 | Personal protective equipment – Part 3 Protective Footwear |
| 24. | IS 15298 (Part 4) : 2017 | Personal protective equipment – Part 4 Occupational Footwear |
| 25. | IS 3976:2003 | Safety rubber canvas boots for miner |
In furtherance to the set standards being introduced, BIS has now issued a set of guidelines in the form of a step wise process for first time applicants to be followed in order to obtain BIS certification for footwear’s.
This notification doesn’t introduce any additional standards apart from those listed above but is a step wise process of the getting above mentioned IS standards which are coming into effect from 1st July,2021.
Source:
https://bis.gov.in/wp-content/uploads/2021/02/footwear-circular-modified-1.pdf
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India: Trans Fat Elimination by 2022- FSSAI.
The Food Safety and Standards Authority of India (FSSAI) has limited the industrial trans fatty acids vide and amendment to the Food Safety and Standards (Prohibition and Restriction on Sales) Regulations[1].
Thus, the FSSAI has limited the amount of trans fatty acids (TFA) in oils and fats to 3% for 2021 and 2% by 2022 from the current permissible limit of 5%.
Key Pointers
- Limiting industrial TFA (iTFA) to not more than 3% in all fats and oils by January 2021 and not more than 2% by January, 2022
- All food products in which edible oils and fats are used as an ingredient shall not contain industrial trans fatty acids more than 2% by mass of the total oils/fats present in the product, on and from January 01, 2022
- Definition of iTFA– “Industrial trans fatty acids (iTFAs) is – all the geometrical isomers of monounsaturated and polyunsaturated fatty acids having non-conjugated, interrupted by at least one methylene group, carbon double bonds in the trans configuration. It excludes trans-fatty acids from dairy, meat, fish and their products.”
India has become the second Asian country after Thailand to join the league of nations adopting trans-fat elimination policies. According to the World Health Organization, one of the most common causes of death is heart diseases, which is further aggravated by intake of trans fatty acids. Thus, there is a dire need to increase awareness about Trans Fat Elimination and FSSAI’s move to cap the limit of iTFA in food articles is a welcome move.
Food Laws in India
The food safety laws in India are primarily regulated by the Food Safety and Standards Act, 2006 and the
Food Safety and Standards Act (FSS), 2006 is an Act enacted to keep up with the changing needs requirements of time and to consolidate the laws relating to food and to establish the food safety and standards authority of India. Some of the important objects of the act include packaging and labelling of food products, signage and customer notice and licensing registrations.
What is FSSAI?
The Food Safety and Standards Authority of India (FSSAI), established under the Food Safety and Standards Act, 2006, is responsible for protecting and promoting public health through the regulation and supervision of food safety.
The various functions of FSSAI inter alia include framing of regulations to lay down the standards and guidelines in relation to articles of food, specifying appropriate system of enforcing various standards, laying down mechanisms and guidelines for accreditation of certification bodies engaged in certification of food safety management system for food businesses, laying down procedure and guidelines for accreditation of laboratories and notification of the accredited laboratories etc.
To know more about Food Laws in India click here.
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INITIATION OF CIRP BY OPERATIONAL CREDITOR.
By Nihit Nagpal and Anuj Jhawar
When the Corporate Debtor defaults in making payments to its creditors the process of Corporate Insolvency Resolution Process (CIRP) can be initiated against it by its creditors. The Insolvency and Bankruptcy Code, 2016 (hereafter “the Code”) provides the process for insolvency resolution process (IRP). For this purpose the government also enacted the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 and Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 (hereafter “the Rules”). The Central government on March 24, 2020 notified that the minimum threshold under section 4 of the Code to initiate any proceeding of insolvency against a Corporate Debtor shall be not less than one crore rupees.[1]
Who is an Operational Creditor?
As defined in section 5(20) of the Code, an operational creditor include all person/corporation who are legally owed operational debt and include those to whom such debt has been legally assigned or transferred. Operational debt, as defined under section 5(21) of the Code, includes debts with respect to the exchange of goods or services. It also includes dues to an employee or a debt in respect of repayment of dues arising under any law, payable to the Central or State Government or any other authority.
Procedure to initiate a CIRP
Where a Corporate Debtor commits a default, an operational creditor itself may initiate CIRP with respect to such Corporate Debtor by following the steps as under:
Upon a default by the debtor the operational creditor shall send a demand notice under section 8 of the Code. Rule 5 of the Rules state that the operational creditor shall send:
- a notice as prescribed under Form 3 of the Rules and,
- copy of invoice demanding payment as prescribed under Form 4 of the Rules
The demand notice may be delivered to the Corporate Debtor at the registered office by hand or post with acknowledgement or electronic mail service.
Within 10 days from receiving the demand notice, the debtor shall bring to the notice of the operational creditor attested copy of repayment details or existence of any dispute.
After the expiry of 10 days if the Corporate Debtor fails to take necessary actions, then the operational creditor shall file an application for initiating a CIRP as per section 9 of the Code as under:
- Rule 6 of the Rules specify that the CIRP against the Corporate Debtor shall be initiated as specified under From 5 of the Rules.
Under the said Form, the operational creditor shall mention all relevant details in relation to the dispute which are:
- Particulars of the Corporate Debtor such as name, identification number, address, capital structure as per the article of association of the debtor;
- Particulars of the proposed interim resolution professional (if proposed);
- Particulars of the operational debt such as total debt amount, date from which it is due, amount of debt in default, date on which default occurred;
- Additionally attach all relevant documents in support of the claims.
Before filing with the Adjudicating Authority, a copy of the application shall be served to the registered office of the Corporate Debtor.
The Adjudicating Authority shall, within 14 days of the receipt of the CIRP application, by an order—
Admit the application and communicate such decision to the operational creditor and the Corporate Debtor if,—
- the application made is complete;
- there is no repayment payment of the unpaid operational debt;
- the invoice or notice for payment to the Corporate Debtor has been delivered by the operational creditor;
- no notice of dispute has been received by the operational creditor or there is no record of dispute in the information utility;
Reject the application and communicate such decision to the operational creditor and the Corporate Debtor, if—
- the application made under is incomplete;
- there has been repayment payment of the unpaid operational debt;
- the creditor has not delivered the invoice or notice for payment to the Corporate Debtor;
- notice of dispute has been received by the operational creditor or there is a record of dispute in the information utility;
Before rejecting an application, the Adjudicating Authority shall give a notice to the applicant to rectify the defect within 7 days from the date of receipt of such notice
The Corporate Insolvency Resolution Process shall commence from the date of admission of the application under sub-section 9 (5) of the Code.
CONCLUSION
The Operational Creditors are eligible to initiate the Corporate Insolvency Resolution Process against a Corporate Debtor when there is nonpayment of debt owed by the Corporate Debtor. The sections and rules have clearly defined the complete procedure and requirement of filing a case before NCLT under the Code for speedy resolutions.
[1] Ministry of Corporate Affairs, India, S.0. 1205(E).
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Fraudulent Websites offering Low Cost Trademark Filings Revealed!!
An alarming incident has been reported involving websites engaged in fraudulent and low cost trademark filings. It has been reported that the incident is one of the biggest money laundering case of Pakistan[1]. Investigation revealed that an entity, namely, Diagnostics Labs operated almost 200 fraudulent websites and also issued fake USPTO trademark registration certificates while luring customers with low cost trademark filings.
Thereafter, the Federal Investigation Agency of Pakistan also published a Report, revealing the details of the money laundering case and also arrested the perpetrators involved in the crime. It has also been reported that these websites were providing brand creation services like logo designing, website creation and trademark filing services[2].
One of the most startling revelation as reported by the WTR is that the alleged Lab was operating a website for low cost trademark filings with the name USPTO Trademarks and the website allegedly had colour scheme and appearance similar to that of USPTO’s website.
Beware of Fraudulent Trademark filings!!!
This whole incident reveals that how perpetrators have been defrauding trademark applicants in the name of low trademark filing fees and also sending them fake USPTO registration certificates. Trademark filings through such fraudulent routes eventually serve no purpose and cripple the brand owners not only financially but mentally as well.
A simple search on Google for Trademark filing will enlist number of websites shouting out low cost filings, however brand owners should be cautious enough of not falling in the traps of such websites. In such circumstances it is always advisable to consult a law firm or a Lawyer, who are learned and aware about the whole process of filing and prosecution of trademarks in India and abroad.
As a brand owner it is very important to understand that trademark filing and obtaining of registration is not just a procedural compliance involving submission of application and receipt of registration certificate. The whole process is a complex one, which at several stages require legal assistance and such websites lack that qualification and judgment to aid brand owners in securing their IP rights.
The incident as reported aforesaid coupled with the fact that brand owners shall rely on trusted sources only brings us to the conclusion that IP filings shall be done by qualified trademark and Patent professionals only.