Cabinet DecisionsLegislation Updates

The Union Cabinet, chaired by the Prime Minister Narendra Modi has approved promulgation of an Ordinance to amend the definition of “person”, as defined in sub-section (v) of Section 2 of the Special Economic Zones Act, 2005 (28 of2005) to include a trust, to enable the setting up of a unit in a Special Economic Zone by a trust, as also to provide flexibility to the Central Government to include in this definition of a person, any entity that the Central Government may notify from time to time.

Impact:

The present provision of the SEZs Act, 2005 do not permit ‘trusts’ to set up units in SEZs. The amendment will enable a trust to be considered for grant of permission to set up a unit in SEZs. The amendment will also provide flexibility to the Central Government to include in this definition of a person, any entity that the Central Government may notify from time to time. This will facilitate investments in Special Economic Zones.

[Press Release dt. 28-02-2019]

Cabinet

Legislation UpdatesStatutes/Bills/Ordinances

The President of India on the 21-02-2019 has promulgated the following four Ordinances, namely:––

1. The Muslim Women (Protection of Rights on Marriage) Second Ordinance, 2019 (Ord. 4 of 2019).

2. The Indian Medical Council (Amendment) Second Ordinance, 2019 (Ord. 5 of 2019).

3. The Companies (Amendment) Second Ordinance, 2019 (Ord. 6 of 2019).

4. The Banning of Unregulated Deposit Schemes Ordinance, 2019 (Ord. 7 of 2019).

The Muslim Women (Protection of Rights on Marriage) Second Ordinance, 2019 has been promulgated to give continued effect to the provisions brought in by the Muslim Women (Protection of Rights on Marriage) Ordinance, 2019. This Ordinance, inter alia, declares the practice of triple talaq to be void and illegal and also to make it an offence punishable with imprisonment up to three years and fine.

The Ordinance will protect the rights of married Muslim women and deter the practice of divorce by triple talaq (i.e., talaq –e –biddat). It also provide for payment of subsistence allowance and custody of minor children.

The Indian Medical Council (Amendment) Second Ordinance, 2019 has been promulgated to give continued effect to the work already done by the Board of Governors (BOG) as per the provisions of earlier Ordinance. This Ordinance, inter alia, enables the Board of Governors appointed in supersession of the Medical Council of India (MCI) to continue to exercise the powers of MCI for a period of two years or till the Council is reconstituted, whichever is earlier so as to ensure transparency, accountability and quality in the governance of medical education in the country.

In pursuance of the Government’s objective of providing Ease of Doing Business to Law abiding corporate while simultaneously strengthening the corporate governance and compliance framework enshrined in the Companies Act, 2013, the Companies (Amendment) Second Ordinance, 2019 has been promulgated with a view, to empower the Central Government to allow certain companies to have a different financial year instead of as determined by the Tribunal. This Ordinance, inter alia, addresses the need to impose civil liability for technical and procedural defaults of a minor nature and to plug the corporate governance and enforcement framework, through the following: (i) re-categorisation of 16 minor offences as civil defaults which will de-clog special courts; (ii) transfer of certain routine functions such as permitting conversion of a public company into a private company from NCLT to the Central Government; (iii) making non-maintenance of registered office and non-reporting of commencement of business as grounds for striking of from register of companies; and (iv) breach of ceiling on Directorships being made a ground for disqualification; (vi) Enhancing the pecuniary jurisdiction of Regional Director’s for compounding offences under the Companies Act with a view to unburdening the NCLT of routine functions etc.

The Banning of Unregulated Deposit Schemes Ordinance, 2019 has been promulgated to have a central legislation to tackle the menace of illicit deposits taking activities in the country. Presently, non-banking entities are allowed to raise deposits from the public under the provisions of various statutes enacted by the Central Government and State Governments. However, the regulatory framework for deposit-taking activity in the country is not seamless. Despite such diverse regulatory framework, schemes and arrangements leading to unauthorised collection of money and deposits fraudulently by inducing the public to invest in uncertain schemes promising high returns or other benefits are still operating in the society.

This Ordinance, therefore, ensures a comprehensive ban on unregulated deposit-taking activity and for its effective enforcement. It aims to prevent such unregulated deposit schemes or arrangements at their inception and at the same time makes soliciting, inviting or accepting deposits pursuant to an unregulated deposited scheme as a punishable offence. The said Ordinance also seeks to put in place a mechanism by which the depositors can be repaid without delay by attaching the assets of the defaulting establishments.

[Source: PIB]

Ministry Of Law & Justice

Legislation UpdatesStatutes/Bills/Ordinances

The Government on May 3 published an Ordinance in the Gazette of India which made major changes to the Commercial Court structure in India. These courts were set up below the District Judge level, keeping in mind the increasing number of commercial disputes with a growing economy, and to bring about a speedy resolution of conflict, to showcase India as a lucrative destination for foreign investment. This ordinance sought to amend the Commercial Courts, Commercial Division and the Commercial Appellate Division in High Courts Act of 2015 (the Act).

The amendment made the following important changes to the Act:

1. Addition of the phrase “Commercial Appellate Courts” to the long title of the Act, and prescribing “Commercial Courts Act, 2015” as the short title.

2. In S. 2(i) of the Act, ‘specified value’ was lowered from amounts exceeding One crore rupees to amounts exceeding Three lakh rupees, substantially increasing the ambit of the courts’ jurisdiction.

3. In the High Courts of Bombay, Delhi, Calcutta, Madras and Himachal Pradesh, which exercise ordinary original civil jurisdiction in respect of territories of the cities of Mumbai, Delhi, Kolkata, Chennai and the State of Himachal Pradesh, the State government, in consultation with the respective High Court, shall constitute Commercial Courts at District Judge Level, and also specify the pecuniary value for these courts, which shall be greater than 3 lakhs but less than the pecuniary value of the jurisdiction of the District Court.

4. Where the High Courts do not exercise ordinary original civil jurisdiction, the State government may, in consultation with the respective High Court, establish Commercial Appellate Courts at the District Judge level, to hear appeals against judgments passed by the Commercial Courts below the District Judge level.

5. Insertion of Chapter IIIA to the Act which mandates, in suits not contemplating any urgent interim relief, pre-institution mediation, the manner and procedure of which is to be prescribed by the Central Government. Such a suit shall not be instituted till the remedy of mediation has been exhausted.

Ministry of Law and Justice

Cabinet DecisionsLegislation Updates

In a major development against the increasing incidents of child rapes in the country, the Union cabinet, on 21-04-2018, cleared the ordinance on POCSO Act. The ordinance will give the death penalty to those convicted of raping a child up to 12 years of age. The Centre has cleared the criminal law amendment ordinance and POCSO Act is a part of this amendment. The demand for the death penalty to child rapists took centre stage after the two separate cases of gangrape and murder emerged from Jammu’s Kathua and Uttar Pradesh’s Unnao. With the incidents of minor rape cases on the rise, the ordinance will be effective in amending the POCSO (Protection of Children from Sexual Offences) Act. As per the current POCSO law, the minimum punishment for “aggravated assault” is 7 years in jail and maximum is a life sentence. The Centre is also inclined towards amending the penal law in order to introduce death penalty to sexual abusers of children up to 12 years of age.

Legislation UpdatesStatutes/Bills/Ordinances

The Enemy Property (Amendment and Validation) Third Ordinance, 2016 has been promulgated by the President of India with the aim of making amendments to the existing Enemy Property Act, 1968 and Public Premises (Eviction of Unauthorised Occupants) Act, 1971. It shall be deemed to have come into force by 7th January, 2016.

The amendments executed through this Ordinance include, amendment in Section 5 by which clause (3) has been inserted in the provision which states that “The enemy property vested in the custodian shall, notwithstanding that the enemy or the enemy subject or the enemy firm has ceased to an enemy due to death extinction winding up of business or change of nationality or that the legal heir and successor is a citizen of India or the citizen of a country which is not an enemy, continue to remain, save as otherwise provided in this Act, vested in the Custodian.”

While a newly inserted section 5A provides for issue of certificate by custodian to declare that the enemy property vests in him. While the newly inserted section 5 B provides that the law of succession does not apply to enemy property.

Further, the Ordinance, by the virtue of section 6, also restricts the transfer of any property which is vested in the custodian by an enemy or enemy subject or enemy firm.

The Ordinance further inserts a new Section 8 A which deals with Sale of property by Custodian which also imposes a liability on the custodian to preserve the enemy property till the time is duly disposed off in accordance with the provisions of the Act.Section 10 confers the power to issue a certificate of sale by the custodian.

Section 18 provides provisions for transfer of property which is vested as an enemy property in certain cases and the sub-clause A of the same confers the right to not return the income made from an enemy property but from its sales. The section further lays the jurisdiction of the competent court, in which an aggrieved matter can be raised.

The Ordinance further repealed The Enemy Property (Amendment and Validation) Second Ordinance, 2016. Further, action taken under the Enemy Property Act, 1968 as amended by the said Ordinance, shall be deemed to have been done or taken under the corresponding provisions of the said Act, as amended by this Ordinance.

Ministry of Law and Justice