RBI monetary policy suggests dropping pricing requirements
In an unexpected move, the Reserve Bank of India (RBI), through its first bi-monthly Monetary Policy Statement for the financial year 2014–15, has announced that it will ‘withdraw all the existing guidelines relating to valuation in case of any acquisition/sale of shares’. The actual guidelines are awaited.
It will be interesting to see how these guidelines are eventually implemented. Currently, valuation requirements are prescribed under various statutes and regulations: (i) the Foreign Exchange Management Act 1999 by the RBI for the issuance and transfer of securities for certain foreign investors; (ii) guidelines issued by the Securities and Exchange Board of India for listed public companies; (iii) the newly notified Companies Act 2013 and rules made thereunder for preferential allotment of shares; and (iv) transfer pricing requirements for issuance/transfer of shares between associated enterprises and under the Income Tax Act 1961 and rules made thereunder, where difference between fair market value and the transaction value could be taxed in the hands of the recipient of the shares, depending on the facts and circumstances…
Click on the link below to read the rest of the Khaitan & Co briefing.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from Khaitan & Co
News from The Lawyer
Briefings from Khaitan & Co
Given the prevailing uncertainty, a conclusive finding from the Supreme Court would be welcome.
The Indian securities market regulator, the Securities Exchange Board of India (SEBI) has overhauled the regulatory regime for voluntary delisting of companies in India.