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2 DECEMBER, 2010 NIR C NEWSLETTER NIRC EDITORIAL BOARD From the Desk of the Chairman... ✍ Chairman CA. Atul Kumar Gupta Dear Professional Colleagues, Vice-Chairman CA. Vishal Garg Member CA. Hans Raj Chugh CA. Sanjay Kumar Agrawal CA. Rashmi Khetrapal CA. Mohan Lal Mittal CA. Durga Das Agrawal CA. Pramod Maheshwari Once Charles R. Swindoll Quote, “The longer I live the more I realize the impact of attitude on life. Attitude to me is more important than facts.... We cannot change our past...we cannot change the fact that people will act in a certain way. We cannot change the inevitable. The only thing we can do is play on the string we have, and that is our attitude. I am convinced that life is 10 percent what happens to me and 90 percent how I react to it. And so it is with you... we are in charge of our attitudes”. Editor CA. Atul Kumar Gupta NORTHERN INDIA REGIONAL COUNCIL of The Institute of Chartered Accountants of India "ICAI Bhawan", 5th Floor, Annexe Building, Indraprastha Marg, New Delhi-110002 Printed and Published by CA. Amit Threja, Sr. Deputy Secretary, on behalf of the Northern India Regional Council of The Institute of Chartered Accountants of India "ICAI Bhawan", Indraprastha Marg, New Delhi-2 Phones : 30100500, 30100503 Fax : 30100509 and Printed at Tara Art Printers Pvt. Ltd., Noida DISCLAIMER : The NIRC is not in any way responsible for the result of any action taken on the basis of the advertisement published in the Newsletter. The members, however, may bear in mind the provision of the Code of Ethics while responding to the advertisements. Regional Council Members (NIRC of ICAI) These golden lines set the path for a famous quote, I always mention, “it is not the aptitude but the attitude that determine your altitude”. We at NIRC in this entire year worked on this theme and believe that it could result in certain positive movements in the direction of excellence. Today we find more positive vibration, discussion and outlook among members and students. Research Group formation inculcates the research curiosity among members and offer platform to develop new speakers and contributors in profession. Study Circles joining hands with NIRC for development of Profession in more cohesive way. Students’ response to every call of NIRC is really worth appreciating. Career Counseling In the last issue, I mentioned about the initiation of career counseling in schools for younger generation to make them more informed about their career prospective. I think that initiative clicked and we received large number of inquiry from schools to become part of this process. In last two months, not only thousands of students were counseled but also we are getting opportunity to join hands with Haryana Government Authorities for their similar initiative in larger way. We believe, this process will further widen when we will be moving to Universities and Colleges and shouldering to other organ of our premier Institute. Team NIRC feels fortunate themselves when it receive the opportunity to become “Knowledge Partner” with reputed Shri Ram College of Commerce for their initiatives in IFRS training to Faculty and Students. CA. Atul Kumar Gupta Chairman CA. Vishal Garg Vice-Chairman CA. Hans Raj Chugh Secretary 9811207924 International Conference of CA Students CA. Sanjay Kumar Agrawal Treasurer 9910399944 CA. Rashmi Khetrapal (Ms.) NICASA-Chairperson 9810101449 CA. Mohan Lal Mittal Executive Member 9811024242 CA.(Dr.) Durga Das Agrawal Executive Member 9811075092 CA. Pramod K. Maheshwari Executive Member 9810017953 CA. Deen Dayal Agrawal Member 9810028042 CA. Rajiv Goel Member 9899412123 CA. Rajesh Sharma Member 9810277394 CA. Gopal Kumar Kedia Member 9810131451 9810103611 09814133353 CA. Vinod Jain 9811040004 We as Team NIRC always aspire to give our students, “The best”. Whether we discuss their education, practical orientation, General Management and communication training, sports and cultural curiosity and hand on practical training, we tried to develop an environment of care, belongingness and excellence. On the one hand, when we introduce the bio-metric attendance system to infuse discipline among students, we reacted sharply on their feedback to render quality services. There was always a demand that northern part of country should organize an International event for students, which can provide our students a platform to show their knowledge, talent and organizing skills. With the blessings of Hon’ble President, CA Amarjit Chopra and Chairman Board of Studies, CA Vinod Jain, our dreams with students will come true when the northern part will witness the mega event on 28-29th December at New Delhi. We believe that this historical event will not only ensure the larger participation but also proposed cultural event coupled with, will infuse the greater cohesive environment and feeling of campus amongst students. CA. Charanjot Singh Nanda 9811130985 Services to Students CA. Sanjay Kumar Agarwal 9811080342 CA. Naveen ND Gupta 9810689998 CA. Pankaj Tyagee 9811902889 Central Council Members–ICAI (Northern Region) CA. Amarjit Chopra, Hon'ble President, ICAI 9810100299 Regular classes at North Delhi Dear Students, while meeting our commitment to render most effective services, your Team NIRC also starting regular classes for CPT and few subjects DECEMBER, 2010 in northern part of Delhi from 27th December 2010. We believe this effort will go in long way to serve the students by rendering quality education at a very economical way. No pendency in GMCS/Orientation Registration Excellence is the gradual result of always striving to do better. Process initiated at early stage of this year for online registration and batch allocation of GMCS and Orientation module is serving students with excellence and we feel satisfy to declare that today there is not even a single pendency for these students. Similarly the efforts were made to develop online mechanism for ITT classes which became online from 1st December 2010. Now all the three compulsory classes for students are available online for students without any pendency. Role of Branches We always say that the branches are arms and legs of any organisation. Without them, we can’t visualize the spread of profession and services to each and every corner of the country and globe. We salute the members who are living in smaller towns, who not only act as flag bearer of the profession at local level but also assist students in their aspiration to become dynamic member of this prestigious profession. Here the roles of branches are very important. Branches need not only to update and share knowledge among members through organizing seminar but also has to act as catalyst for growth. Though branches of northern part are quite active, still we believe that more cohesiveness and efforts with brotherhood need to initiate. To develop the profession more dynamic, they need to organize regular workshops and conferences for students, invite regulators at local level, organize regular and revisionary classes, issue enewsletter for members and students, develop infrastructure in the shape of own building, maintain a good and informative web site with facility of email id to each member and develop a sense of belongingness among members by organizing workshop for families. Your team NIRC is working hard and visiting every branch to inculcate these practices, but still lot has to do in this direction. In the last month, your team NIRC visited Jammu and Kashmir, Sonepat, Rohtak, Hisar branch and Pathankot Chapter for the same. Family Workshop for Healthy living Dear Members, We, while acting as a professional consultant to our clients and employers assume lot of responsibility and accountability on our shoulders. Though, it results in desired recognition in the society but also creates stress and poor food habits. It is well said, “Health is wealth”. Our professional colleagues are masters of wealth management but generally ignore their health. Your NIRC while rendering technical updates to our members also assumes the responsibility to create awareness among members for health consciousness. In this direction recently we organized much sought “Dil ki KaryashalaFamily Health Workshop” for Members and spouse followed by “Zero oil Food”. Large participation of Members with spouse was really appreciable and motivates team NIRC for consistent efforts. NIR C NEWSLETTER 3 NIRC Infrastructure at NIRC Your Team NIRC always aspires to serve members and students with innovative steps. Number of simultaneous activities requires larger resources in term of manpower and space. Further, we always desire to have a member lounge at NIRC level. We have requested the head office to provide more space for efficient working of NIRC. Now, we are pleased to inform that with blessing of our hon’ble President, CA Amarjit Chopra, head office agreed to give 4th floor of ICAI Bhawan annexes to NIRC. We are also looking forward to develop new branches and building of existing branches so that they can render most effective and competitive services. We believe that once the virtual classes at national level will be launched, these infrastructures will assist in a long way for economic delivery of services to students. International Conference of Members Organizing International Conference of member is an annual phenomenon to show the effort and research put in by Indian Chartered Accountant for development of economy. One may treat this event “Maha Kumbh” of CAs and stakeholders. Members get the opportunity to develop network and learn new initiatives across the globe. This year the same will be organized between 4th, 5th and 6th January 2011 at New Delhi. Web sites and Journal of ICAI and NIRC contain all details of the event. We request our members to participate in the same in large numbers. Workshop on Bank Audit It is well known fact that our large numbers of members especially in smaller towns have good proportion of revenue from audits in banking sector. Though, the same need to introspect, still it is our duty to equip and update our members with latest tools and amendments. Your team NIRC is organizing 3 days workshop from 21st to 23rd December 2010 on various audits under banking sector. We believe coverage and availability of experts of this field will convert this workshop a really memorable event. As the New Year is approaching, I with my council colleagues and team wish all members, their family and friends a very happy and prosperous Christmas and New Year and pray God to shower his blessing on each one of us. May God enlighten our path towards joy, peace and satisfaction. Yours in Professional fellowship Warm Regards December 10, 2010 New Delhi (CA. Atul Kumar Gupta) 4 DECEMBER, 2010 NIR C NEWSLETTER NIRC From the Desk of the Secretary...✍ Dear Professional Colleagues “Attitude is the way you mentally look at the world around you. It is how you view your environment and your future. It is the focus you develop toward life itself”. Secretary “Whatever the mind of a person can conceive and believe, it can achieve” Ours is a profession whose foundation is based on the knowledge and your NIRC has always been proactive to provide opportunities to enhance the knowledge of the its members and students to update their skills and competencies to cater to the needs of the professional world by organizing various seminars/conferences/workshops etc. During the month your NIRC has organized various seminars, conferences and workshops for the benefits of the members i.e. Seminar on FEMA , Seminar on Corporate Governance and Capacity building of CA Firms, Seminar on FinancingEmerging Trends & New Dimensions, Seminar on Social Audit and workshop on Audit Excellence. Some of the programmes have been organized jointly with Study Circles i.e. Seminar on Merger & Acquisitions with East Delhi CPE Study Circle, Seminar on FEMA and Income Tax with Patel Nagar, Dhaka Chambers and Karol Bagh Westend CPE Study Circles, Seminar on Personality Development with North Campus CPE Study Circle. A talk/discussion was also held on Appeals before CIT (Appeals) at G-19 Bar Room at C.R. Building, New Delhi. Various Research study group has played a significant role in organizing respective programmes. We are sure that these seminars/conferences/workshops have certainly enriched the members on respective topics. The programmes to be organized during the next month is enlisted somewhere else in this newsletter. Your NIRC equally feels that the best use of the knowledge and skill can only be attained when the professionals are physically fit. Considering this fact your NIRC has organized a programme for the members with spouse on Healthy Living. In this programme numbers of tips and traits was given by the learned speakers on fitness of the heart and fitness of the body through Hasya Yoga. The event was appreciated by everyone. Your Team NIRC feels honoured by the presence of our respected President CA Amarjit Chopra, Vice President CA G. Ramaswamy and many other dignitaries. Your Team NIRC is committed towards such programmes in future too which brings a kind of togetherness and closeness within the CA families also. Jammu Branch and Pathankot CPE Study Chapter of the NIRC have organized an interaction meeting with our Hon’ble President CA Amarjit Chopra Ji, Vice President CA G. Ramaswami ji, Central Council Members and Regional Council Members. Hon’ble President and Vice President while addressing the members shared his views and visions about the profession. Chairman NIRC, CA Atul Kumar Gupta has also shared his views and assured the branches all kind of support. Jammu Branch has hosted the Sub-Regional Conference also. Members, we have two high profile programmes in the coming months, one for the Students and one for the Members. As we all know students are the instrumental to accomplish the professionals task and plays a role in our day to day professional activities. Your NIRC Jointly with Board of Studies, ICAI is organizing an International Conference of CA Students naming “Indian Accountancy Profession: Marching Towards Global Centre Stage” on 28-29th December, 2010 at New Delhi. This is the very first International Conference of CA Students in our region. Members are requested to please encourage their article assistants to participate in the conference to update them and to serve the profession better. Members, Our Institute is also organizing an International Conference on 4-6th January, 2011 at Vigyan Bhawan, New Delhi. Theme of the conference is “Accountancy Profession : Catalyst to Sustained Economic Growth”. Members are requested to please participate in numbers and make it a grand success as the event is being organized in our own region after a long gap. Complete details of the programme are available at Institute’s website www.icai.org. Team NIRC wishes all of you a Merry Christmas and a Very Happy New Year 2011 ahead. With best wishes and warm regards December 10, 2010 New Delhi (CA. HANS RAJ CHUGH) “Whatever the mind of a man can conceive and believe, it can achieve”- Napoleon Hill DECEMBER, 2010 NIR C NEWSLETTER 5 NIRC Critical Analysis of Supreme Court Ruling in Case of Association of Leasing & Financial Service Companies Vs Union of India and Others CA. Rajat Mohan Recently Supreme Court upheld the constitutional validity of levy of service tax on financial leasing services. This judgment would have far reaching implications on service tax practitioners throughout the country. We as worthy body of accountants and tax practitioners need to understand the judgment in 4 parts i.e. facts, appellants contentions, revenues reply and decision by Supreme Court. Facts Appellant is an Association of leasing and financial companies. Appellants contend that service tax imposed by Section 66 of the Finance Act, 1994 on the value of taxable services referred to in Section 65(105)(zm) read with Section 65(12) of the Finance Act, 1994, insofar as it relates to financial leasing services including equipment leasing and hire purchase is beyond the legislative competence of Parliament by virtue of Article 366(29A) of the Constitution. Submissions by appellant Article 366(29A) treat’s 6 types of transactions as deemed sales so as to enable state legislatures to levy sales tax under Entry 54, List II. This article inter-alia reads as “”(29A) “tax on the sale or purchase of goods” includes- (c) a tax on the delivery of goods on hirepurchase or any system of payment by installments. Thus, having characterized constitutionally the subject matter of hire-purchase and leasing as a sale (deemed sale), it is not open to Parliament to tax the same subject matter under Entry 97, List I. When sales tax is already paid for the transfer of the right to use the goods particularly when such transfer is a deemed sale under Article 366(29A), it is not open to Parliament to impose service tax on the same transaction once again. Reply by Revenue Revenue submitted that Article 366 was inserted in order to give an artificial extension to the definition of sale so as to include the power to levy sales tax even on the hiring part, and this is all The views expressed herein are his personal views and do not necessarily represent the views of the NIRC that Article 366(29A) intended to do. One cannot infer that Parliament has divested itself of the power to levy service tax. Revenue stated there is conceptual distinction between a service tax and a tax on hiring transaction. The business of banking or organizing financial services is an organized activity and service tax is imposed on that activity of financial leasing services provided by a banking company, a non-banking financial company, a body corporate engaged in the business of financial leasing, etc. That, service tax is not imposed on the hiring part of a hire-purchase transaction. According to Revenue, it would not be correct to suggest that the whole “field” is covered by Entry 54 of List II. For the afore-stated reasons, it was submitted that the impugned levy is within the legislative competence of Parliament with reference to Entry 97 of List I of Seventh Schedule of the Constitution and, thus, the same is constitutionally valid. Ruling by Supreme Court Supreme Court stated that activities undertaken by NBFCs of equipment leasing and hire-purchase finance are facilities extended by NBFCs to their customers; they are financial services rendered by NBFCs to their customers and that they fall within the meaning of the words “banking and other financial services” which is sought to be brought within the service tax net under Section 66 of the Finance Act, 1994. With the application of AS-19, the leased assets are required to be shown as “receivables” and not as fixed assets which further shows that equipment leasing and hire-purchase finance are financial facilities which thereby funds projects presented by the customers to banks and other financial institutions including NBFCs. Thus, the impugned tax is levied on these services as taxable services. It is not a tax on material or sale. Supreme Court also noted that before the Constitution (Forty-sixth Amendment) Act, hire-purchase transaction could have been taxed by Union under Entry 97, List I but as a matter of policy Parliament brought in Article 366 (29A) as recommended by the Commission. The point to be noted is that service tax was not in the mind of Parliament when the Constitution (Forty-sixth Amendment) Act stood enacted. Supreme Court also stated that Article 366(29A) is essentially sales tax specific. It was brought in to expand the tax base which stood narrowed down because of certain judgments of this Court. That is the reason for bringing in the concept of “deemed sale” under which tax could be imposed on mere “delivery” on hirepurchase which expression is also there in the second limb of the said article. Supreme court stated that Entry 97 of List I with Article 246(1) confers exclusive power first, to make laws in respect of matters specified in Entries 1 to 96 in List I and, secondly, it confers the residuary power of making laws by Entry 97. Article 248 does not provide for any express powers of Parliament but only for its residuary power. Merely because for valuation purposes inter alia “finance/ interest charges” are taken into account and merely because service tax is imposed on financial services with reference to “hiring/ interest” charges, the impugned tax does not cease to be service tax and nor does it become tax on hire- purchase/ leasing transactions under Article 366(29A) read with Entry 54, List II. Thus, while State Legislature is competent to impose tax on “sale” by legislation relatable to Entry 54 of List II of Seventh Schedule, tax on the aspect of the “services”, vendor not being relatable to any entry in the State List, would be within the legislative competence of the Parliament under Article 248 read with Entry 97 of List I of Seventh Schedule to the Constitution. Supreme Court held that Service tax imposed by Section 66 of the Finance Act, 1994 on the value of taxable services referred to in Section 65(105)(zm) read with Section 65(12) of the said Act, insofar as it relates to financial leasing services including equipment leasing and hire-purchase is within the legislative competence of the Parliament under Entry 97, List I of the Seventh Schedule to the Constitution. ■ 6 DECEMBER, 2010 NIR C NEWSLETTER NIRC IPO Knowledge Process— All about ASBA CA. M.K. Agarwal ASBA-Meaning and Concept : Application Supported by Blocked Amount (ASBA) refers to a new application mechanism for subscribing to initial public offers (IPO). This system, was introduced by SEBI vide its circular no. SEBI/CFD/DIL/DIP/31/ 2008/30/7 (July 30, 2008) for retail investors in 2008, which ensures that the applicant’s money remains in his/her bank account till the shares are allotted, Now it has been extended to corporate investors and HNIs as well (from January 1, 2010, onwards). The mechanism requires the applicant to give an authorization to block his/her application money in the bank account for subscribing to the IPO. His/her bank account is debited only after the basis of allotment is finalized, or the IPO is withdrawn or fails. In case of rights issue, the application money is debited after the receipt of instructions from the Registrars. The entire bank account will not be blocked. Only the amount to the extent of application money authorized in the ASBA will be blocked in the bank account. The balance money, if any, in the account can still be used for other purposes. Application supported by blocked amount (ASBA) is a new investor-friendly way to apply for initial public offerings (IPOs). ASBA is an interface for banks to participate in the process of IPO payments as proposed by the capital markets regulator, the Securities and Exchange Board of India (SEBI). The The views expressed herein are their personal views and do not necessarily represent the views of the NIRC CA. Minal Agarwal objective of introducing ASBA is to ensure an investor’s funds leave his bank account only on allotment of shares in public issues. The ASBA process also ensures that only the required amount of funds is debited to the investor’s bank account on allotment of shares. In this mechanism, the need for refunds is completely obviated. The banks participating in an IPO process can upload the bids with respect to their customers into the electronic books of BSE and NSE. ASBA provides an alternative mode of payment in issues whereby the application money remains in the investor’s account till finalization of basis of allotment in the issue. The process facilitates individual investors bidding at cut-off, with single option, to apply through self-certified syndicate banks (SCSBs), in which the investors have accounts. SCSBs are banks that meet the conditions laid down by SEBI. banking facility.ASBA applications can not be submitted in any of the banks specified in the list of SCSB but only with that SCSB with which the investor is holding the bank account. Detailed procedure of applying in IPO through ASBA : 1. Download the E-ASBA form, available at the website, http:// www.nseindiaipo.com/issueforms/ html/index.html 2. For each applicant separate form should be downloaded, photocopy of one form will not be accepted for separate applicants. 3. Fill in the details like • Name of the applicant • PAN number • Demat account details Facility available with : • Bid quantity Only certain designated banks — SelfCertified Syndicate Banks (SCSB) — can offer this facility to the applicants. SCSB is a bank which is recognized as a bank capable of providing ASBA services to its customers. A list of these banks and their branches can be accessed from the following link http://www.bseindia.com/ bookbuilding/scsb.asp. • Bid price and other relevant details The applicant can submit the ASBA application to the SCSB with whom he/ she is maintaining the account to be blocked (to the extent of the application money) for the purpose. The application can be submitted either by filling up the form or online, by using the Internet 4. Submit the ASBA form to the banking branch giving an instruction to block the amount in their account. 5. The authorized bank, branch will give an acknowledgement on the ASBA application form, and also the order number, generated at the time of uploading the application details, if sought by the investors in case of need which acts as a proof with the investor for any further correspondence. 6. The bank will upload the details of the application in the bidding platform. DECEMBER, 2010 Advantages of ASBA : ASBA Vs application through cheque S.No 1 2 3 Conventional method via cheque Application needs to be annexed with copy of PAN card and cheque Refund orders, come via ECS or physically after 20 days(approx) The investor looses the bank interest for the entire application amount, for more than a fortnight 4 The investor needs to deals with/collect and deposit the forms with unknown intermediaries 5 Cumbersome application form and process ASBA A simple form, available online needs to be filled, no attachments is required, it gives the bank an authorization to block the application amount. No botheration for refund as only that much money to the extent required for allotment of securities, is taken from the bank account only when his application is selected for allotment after the basis of allotment is finalized. The investor continues to earn interest on the application money as the same remains in the bank account, as bank give interest on daily basis, w.e.f from 1,April,2010. The investor deals with the known intermediary i.e. its own bank Simple and convinent, one can apply by sitting in their homes, with net banking facility as well, (if provided by your SCSB). 7. Applications can be applied electronically/online through the internet banking facility also, where the payment can be blocked by online request to the bank (if provided by your SCSB). Salient features of ASBA application procedure : • Investors shall ensure that the details filled in the ASBA form are correct otherwise the form is liable to be rejected. • ASBA forms can be submitted only at the SCSBs. In case investor does not have an account with any of the SCSBs, then he can not make use of the ASBA facility • No. Investors need not necessarily have their DP account with the SCSB, where they are submitting the ASBA form. ASBA not mandatory, application through cheques still valid: However, remember that you cannot avail of both the modes to send in your applications. If you apply through a cheque as well as ASBA, it will be rejected on grounds that it constitutes multiple applications. No different treatment in allotment for ASBA and Non –ASBA forms, ASBA forms will be treated similar to the non-ASBA forms while finalizing the basis of allotment. Withdrawal of ASBA Bids : During the bidding period, one can approach SCSB, to which he/she had submitted the application and make a withdrawal request, post which, the bank will unblock the amount. NIR C NEWSLETTER 7 NIRC After the bid closure period, applicants need to send their withdrawal requests to the Registrars in order to withdraw their bids. Subsequently, the Registrar will ask the SCSB concerned to unblock the application money in the bank account after the finalization of basis of allotment. If the withdrawal is made during the bidding period, the SCSB deletes the bid and unblocks the application money in the bank account. If the withdrawal is made after the bid closure date, the SCSB will unblock the application money only after getting appropriate instruction from the Registrar, which is after the finalization of basis of allotment in the issue. Grievances Cell: In case all correct details were submitted in the ASBA form, but application gets rejected stating wrong data, the investor can approach the concerned SCSB for any complaints regarding ASBA applications. SCSB is required to give reply within 15 days. For any further actions the investor can approach the SEBI thereafter at the following address: Investor Grievance Cell, Office of Investor Assistance and Education, Securities and Exchange Board of India Plot No.C4-A,’G’ Block, Bandra Kurla Complex, Bandra(East), Mumbai: 400051 Tel: +91-22-26449000/40459000 Fax: +91-22-26449016-20/40459016-20 ■ ONLINE REGISTRATION OF INFORMATION TECHNOLOGY TRAINING (ITT) Students are informed that w.e.f. 1st December, 2010 forms for 100 Hours Information Technology Training at Delhi Centres will be accepted only through online registration on www.ittdelhi-icai.org. 8 DECEMBER, 2010 NIR C NEWSLETTER NIRC Insurance : Emerging Professional Opportunities Theme paper contributed by ‘The Research Group on Insurance’, of NIRC of ICAI The Insurance has come up as the most astounding financial product, creating waves in the contemporary financial whiz. The Significance: It has gained the status of inseparable trait from any economic and other activities that carry ‘risk, hence become the most pervasive of all . Insurance is, in essence a Risk management tool, where the Risk manager strategize to manage by transferring the risk to another party, “the insurer/underwriter’. With the dynamism in the economic activities, contributed by hard-to-believe level of globalization, has put onus on the Insurance industry to develop with speed, and wide spectrum, is opened up for their imagination, act and expansion, and consequently , the innovation is the buzz –word in the sector. Growing at enviable speed, and spectrum, thus creating, offering opportunities to related professionals, as partners in Progress. The Stakeholders: The stakeholders, in Insurance comprise virtually of the whole society, and the state. The following diagram explicitly defines the magnitude.. The Insured, The Insurer, Market Intermediaries- Agents/ Brokers/ Bank assurance, Surveyors, The Regulator-IRDA/MINISTRY/ OTHERS, The Social Groups/ Society, The State, Trade/Industry- as Borrowers of Funds-providing Investment avenues to Insurers as end-users of Funds. The Dimensions: While the basics of the Insurance, remains same, the peculiarities, are seen and specialized and distinct dimensions, based on the Methods, definitions and goals that vary widely according to whether the risk management (insurance) method is in the context of project management, security, engineering, industrial processes, financial portfolios, actuarial assessments, or public health and safety. The Indian Perspective: In Indian perspective, the opening up of the otherwise state owned sector, in year 2000 to private players to provide an impetus to the hitherto unexploited insurance market and thereby increase insurance penetration in India, making it more competitive under the macro agenda of liberalization and leverage the insurance players towards long-term development, including infrastructure, saw unprecedented frenzy of activities and growth. The rapid globalization, and India’s enviable record of economic growth has put an onus to respond in matching proportions to meet the aspiration. The number of insurance companies (state owned) prior to opening–up, stood at 6, while presently the number of insurance companies have swelled to 48. With 24 companies in life sector and 24 companies in non-life (General) sector, with more in the offing… The views expressed herein are their personal views and do not necessarily represent the views of the NIRC The premium growth has been gigantic, too. The US$ 41-billion Indian life insurance industry is considered the fifth largest life insurance market, and growing at a rapid pace of 32-34 per cent annually, according to the Life Insurance Council. According to data released by IRDA, the general insurance industry recorded 13.42 per cent growth in gross premium collected during 2009-10. The industry collected gross premium of US$ 7.84 billion in 2009-10 compared with US$ 6.91 billion in 2008-09.The premium collection by General sector stood at Rs. 9,828 crore in 2000, while it swelled to Rs. 32,892 crore in 2010, a growth of over 300 percent in a decade. The Role of Chartered Accountants: The Chartered Accountants, being the masters in finance-related activities having deeper insights, and enviable problem solving capabilities find the big space opened up in the expansion of the Insurance sector. What is needed is the identification of possible growth areas, and competitive landscapes. The Life sector that was hitherto pushing the endowment policies, and small saving schemes related policies, have been induced, to expand. The ULIP based policies, pension funds, have overshadowed the landscape, and have come to be recognized as an effective investment tools, and necessitating identification of sectors, posing for growth, needing the specialized services of Chartered Accountants as counselors in identifying the optimum policy basket. The pension plans, options to invest requires advance financial calculations, of present value, and future values, to arrive at the prudent investment decisions, hence the due diligence before committing funds require the expertise, that We as a professional possess, and can work as worthy and reliable market intermediaries. The General sector is the life blood of trade and industry, beside the individual insurance it touches, in the form of health, motor and miscellaneous sector. The Role of Chartered Accountants, as market intermediaries in this sector is noteworthy, and promising. As Insurance Broker, the Chartered Accountants, can make reliable and diligent services, in drafting of policies, by identifying and evaluating the risk, coverage required, special contingencies to be covered, the DECEMBER, 2010 calculation of sum-insured, the risks to be insured, and the rating , since the careful and professional knowledge may save the prospective buyer of insurance (the insured) from payment of unwanted premium rating escalations, and/or repudiation of claims for non coverage, under coverage of the risk or failure to perceive the coverage thereof. As, surveyor, Chartered accountants have come to be recognized by IRDA as the worthy professionals in the field of Loss of Profit policies and Fire claims, and Miscellaneous policies claims. The specialized knowledge and mastering of analyzing the financial statements of the insured, and arrival at the right quantum of loss under the given circumstances is the CA’s bane. Chartered Accountants have been of immense utility in such assessments and have been a rewarding exercise for the insurers in assessing the rightful quantum in respective claims. IRDA has revised the categorization, and claim assessment domain for Chartered Accountants and the sector offers immense opportunities to the members in practice as an additional, unexplored avenue. The Role of Chartered Accountants as Insurer is widely acclaimed and recognized. The highest offices, in the sector, private and state-owned as well, have been decorated by the members of our noble profession, is a befitting complement to our profession. AS on the day, several CEOs, and the higher hierarchy, in marketing, investment, reinsurance, claim processing, accounts, and audit department of the sector ( life and general) are sworn by our members and professional colleagues. The opportunities in employment , due to our exemplary exposure in related field, is an edge we command, and the opening up of the sector holds too much for our members, present and adding to the fraternity. The other areas includes, the concurrent audits of investment, and underwriting operations, Statutory audits, compliance audits, the intermediation in reinsurance markets. Pension Fund management services, Third Party claim management services, and Insurance claims Arbitration NIR C NEWSLETTER 9 NIRC are the upcoming avenues. Since KYC is also in the offing, in insurance sector, it would enhance our spectrum too. The Chartered Accountants, in recent times, have made big foray as insurer and as the market intermediaries, and surveyors and loss assessors. ICAI: initiatives It is gratifying that our Institute seized the opportunity at the threshold, envisioned the storm, and imparted the new Courses, the working and resource papers as logistics, catering to the Sector specifically, thus equipping the members and providing an edge to compete and dominate the sector. Team NIRC, under its able leadership, is also undertaking the challenge, with seriousness, and has formed the ‘Research Group on Insurance’, to equip the members with befitting logistics and knowledge resource to come up and grab the emerging opportunities the sector is offering since Chartered Accountants are in a fantastic position to leverage, the sector provides. ■ ANNOUNCEMENT Regular Coaching Classes by NIRC of the ICAI for CPT, IPCC/ATC & Final Students Northern India Regional Council of the ICAI is pleased to announce that the Regular Coaching Classes are being organized for CPT, IPCC/ATC & Final w.e.f. 27th December, 2010 (onwards) in the Auditorium of Sunder Lal Jain Hospital, Ashok Vihar, Delhi in addition to ICAI Bhawan, Vishwas Nagar. Date/Timing of these Classes and fee will be as under : CLASSES SUBJECT COURSE FEE CLASS TIMINGS CLASS DAYS Rs. 5000/- 5.00PM–8.00PM Monday to Friday Cost & Financial Accounts Accounts Tax Rs. 1000/Rs. 1000/Rs. 1000/- 6.30AM–10.00AM Monday to Friday Accounts Direct Tax Rs. 1500/Rs. 1500/- 6.30AM–10.00AM 5.00PM–8.00PM Saturday-Sunday CPT IPCC Final Mode of Payment DD/Pay-order in favour of “NIRC of the ICAI” payable at Delhi/New Delhi The relevant form may be downloaded from www.nirc-icai.org. The duration of the Course will be Approx. Three Months. Features of the Programme : • Notes & Handouts, Assignments Sheets, Power Point Presentations. • Prominent/Eminent faculties from different Universities and Senior Chartered Accountants. • Model Test Papers to prepare the exam. • Frequent Mock Tests to assess the performance. C NEWSLETTER 10 DECEMBER, 2010 NIR NIRC DECEMBER, 2010 NIR C NEWSLETTER 11 NIRC C NEWSLETTER 12 DECEMBER, 2010 NIR NIRC DECEMBER, 2010 NIR C NEWSLETTER 13 NIRC REGIONAL COUNCIL ACTIVITIES Date Programme/Topics Chief Guest/Guest Speakers 9 Nov. 10 Career Counseling Session for A.S.N.Public School, Mayur Vihar 10 Nov. 10 Career Counseling Session for Bhai Parmanand Vidya Mandir, Surya Niketan 12-14 Nov. 10 Three Day Residential Workshop on Corporate Law at Jim Corbett Park 15 Nov. 10 Career Counseling Session for Monfort School Career Fair Ashok Vihar 16 Nov. 10 Career Counseling Session for St. Cecilia’s Public School, Vikas Puri 18 Nov. 10 Career Counseling Session for SLS DAV Public School, Mausam Vihar 20 Nov. 10 Full Day Seminar on FEMA Sh. S.K. Panda, Commissioner, CBEC Sh. Amithraj A.N., CA. Jayesh Gandhi CA. S. Harikrishanan, CA. Shabbir Motorwala 20 Nov. 10 Seminar on Merger & Acquisition Jointly with East Delhi CA. CPE Study Circle of NIRC of ICAI Mr. Vineet Bose CA. Puneet Agrawal 22 Nov. 10 Seminar on FEMA and Income Tax Jointly with Patel Nagar, Dakha Chambers and Karol Bagh Westend CPE Study Circle of NIRC of ICAI CA. Atul Kumar Gupta, Chairman, NIRC CA. Munish Mehta, CA. A. K. Srivastava CA. Manoj Jain 26 Nov. 10 Discussion on Appeal before CIT & CIT Organized by G-19 Bar Room Committee of NIRC CA. A.K. Srivastava 27 Nov. 10 Seminar on Corporate Governance & Capacity Building of CA. Firms CS. Pawan Vijay, CA. Parveen Kumar CA. Rashmi Khetrapal, CA. Charanjot Singh Nanda CA. Deepak Bholusaria, CA. Mohan Lal Mittal 29 Nov. 10 Seminar on Personality Development Jointly with North Campus CPE Study Circle of NIRC of ICAI Mr. Ram Krishna Goswami, CA. Durga Das Agrawal CA. Atul Chawla, CA. Prakash Agarwal 3-6 Dec.10 Four Days Training Workshops on AUDIT EXCELLENCE Organized by Auditing & Assurance Standards Board Hosted by Northern India Regional Council of ICAI CA. Abhijit Bandyopadhyay, Chairman, AASB Dr. Sanjib Basu, CA. Manish Saraogi CA. Sanjib Basu, CA. Sameer Parekh CA. Vijay Agarwal, CA. Jaydeep Bhargava CA. Lalit Kumar, CA. Anil Manchanda Mr. Vijay Kapur, CA. Harinderjit Singh Mr. Vijay Kapur, CA. Suneel Maggo CA. V Rethinam, CA. K K Tulsian 4 Dec. 10 Seminar on Financing –Emerging Trends & New Dimension Sh. Sunil Srivastava, Mr. Rajat Surey Mr. Sushant Sachdeva, Mr. Vikas Dawra Mr. Kuldip Chawla, CA. Shashank Jain 5 Dec. 10 A Family Workshop on Healthy Living CA. Amarjit Chopra, Hon’ble President, ICAI Dr. Bimal Chhajer, Sh. Jiten Kohi 6 Dec. 10 Sub Regional Conference at Jammu CA.Charanjot Singh Nanda, Central Council Member, ICAI CA. Pankaj Tyagee, Central Council Member, ICAI CA. Mohan Lal Mittal, Executive Member, NIRC CA. Vishal Garg, Vice-Chairman, NIRC 8 Dec. 10 Seminar on Social Audit Organized by Internal Audit Standards Board of ICAI Hosted by Northern India Regional Council of ICAI CA. Ajay Sud, Dr. Amit Agarwal Ms. Amita Joseph, Ms. Mrinalini Shastry CA. Sanjay Patra CA. Punkaj Jain, CA. Milan Shrimali CA. Arun Saxena, CA. Satish Goyal CA. Pramod Kumar Gupta CA. Rajender Arora, CA. A.K. Jalan CA. Dindayal Agrawal C NEWSLETTER 14 DECEMBER, 2010 NIR NIRC DECEMBER, 2010 NIR C NEWSLETTER 15 NIRC C NEWSLETTER 16 DECEMBER, 2010 NIR NIRC DECEMBER, 2010 NIR C NEWSLETTER 17 NIRC ANNOUNCEMENT Regular Coaching Classes by NIRC of the ICAI for IPCC/ATC & Final Students Northern India Regional Council of the ICAI is pleased to announce that the Regular Coaching Classes are being organized for IPCC/ATC & Final w.e.f. 6th December, 2010 at “ICAI Bhawan” 52-53-54, Vishwas Nagar, Shahdara, Delhi–110032. Seats are limited. Interested students are advised to register with NIRC (i.e. at ICAI Bhawan, NIRC, 5th Floor, Annexe Building, Post Box No. 7100, Indraprastha Marg, New Delhi–110002) at an early date on all working days during office hours (9.45 AM to 5.30 PM). CLASSES COURSE FEE IPCC Gr – I Gr – II Gr (Both) Final Gr – I Gr – II Gr (Both) Mode of Payment CLASS TIMINGS CLASS DAYS Rs. 1500/Rs. 1500/Rs. 2500/- 7.00AM–10.00AM Monday to Sunday Rs. 2500/Rs. 2500/Rs. 4500/- 6.00PM–9.00PM Monday to Sunday DD/Pay-order in favour of “NIRC of the ICAI” payable at Delhi/New Delhi The relevant form may be downloaded from www.nirc-icai.org. The duration of the Course will be Three Months. Features of the Programme : • Notes & Handouts, Assignments Sheets, Power Point Presentations. • Prominent/Eminent faculties from different Universities and Senior Chartered Accountants. • Model Test Papers to prepare the exam. • Frequent Mock Tests to assess the performance. FORTHCOMING PROGRAMMES OF CPE STUDY CIRCLES OF NIRC EAST DELHI CPE STUDY CIRCLE Insurance & Risk Management Date & Day December 17, 2010 (Friday) Timings 05:30 PM To 09:30 PM Venue PKS, Laxmi Nagar, Delhi-110092 Fees Rs. 500/- for participants CPE Hours 4 (Four) CPE Hrs. Issues in Capital Market, Investment Management and Long Term Investing in Capital Market Date & Day December 24, 2010 (Friday) Timings 05:30 PM To 09:30 PM Venue PKS, Laxmi Nagar, Delhi-110092 Fees Rs. 500/- for participants CPE Hours 4 (Four) CPE Hrs. REGISTRATION OPEN FOR ARTICLE ASSISTANTS 30 seats Available on first come first serve basis Req Semi CA (compltd training) /M.Com /B.Com For Accounts & Audit. Req CA & ICWA for handling & finalization of Audit, Taxation, Service Tax & Excise, Business. Valuations, online filling TDS/VAT/ROC returns, Export-Import Doc., Insurance Claim & legal. Big opportunity for CAs as working Partner for deserving & sincere candidates. Extra weightage will be given to CA (DISA) qlfd. GUIDELINES FOR TRAINING OF ARTICLE ASSISTANT OUTSIDE INDIA LC KAILASH & ASSOCIATES The Institute, while considering the difficulties being faced by overseas Members in providing training to articled assistants has issued the revised guidelines and FAQs for training of articled assistants outside India. The same has been hosted on the Institute's website. For more details, please visit our website www.icai.org. CHARTERED ACCOUNTANTS NBR House 122-124, Model Basti, Delhi-110005 Ph. 9910126660, 9560757028, 9873642390 23674977-3384 - 23555128 E-mail : lck_ca@yahoo.co.in C NEWSLETTER 18 DECEMBER, 2010 NIR NIRC FORTHCOMING PROGRAMMES Auditions for CA. Parivaar Prastuti–Part-II By CA. Students Date & Day 12th December, 2010 (Sunday) Timing 09.30 AM–04.00 PM Venue ICAI Bhawan Auditorium, Vishwas Nagar, Shahdara, Delhi Fees Rs. 500/- per participant Seminar on Capital Market & Corporate Governance Accommodation Rs. 500/- to 2000/- per night including/excluding taxes-for Outstation Students US$100 with accommodation for two nights-for overseas participants CA Parivaar Prastuti-Part–II By CA Students Date & Day 28th December, 2010 (Tuesday) Timing 05.30 PM–09.30 PM Venue Auditorium of Shri Ram College of Commerce, Delhi University, Maurice Nagar New Delhi Date & Day 18th December, 2010 (Saturday) Timing 09.30 AM–05.30 PM Venue Jacranda Hall, India Habitat Center, Lodhi Road, New Delhi Date & Day 15th January 2011 (Saturday) Timing 09.30 AM - 05.30 PM Fees Rs. 1500/- for Members Rs. 2000/- for Non Members (Corporate Delegates) Free for All Study Group Members of NIRC of ICAI Venue Silver Oak Hall, India Habitat Centre, Lodhi Road, New Delhi Fees Rs. 1500/- for Members Rs. 2000/- for Non Members (Corporate Delegates) Free for All Study Group Members of NIRC of ICAI *Seminar Jointly with Dwarka CPE Study Circle of NIRC Date & Day Seminar on Accounting Standards (AS 30,31 & 32) 19th December, 2010 (Sunday) Timing 09.30 AM–05.30 PM Venue Indian Height School, Sector-23, Dwarka Fees Rs. 400/- *Topic of Seminar will be hosted on website of NIRC Seminar on TDS Jointly with Patel Nagar and Dakha Chambers Study Circle of NIRC Seminar on Accounting Standards for CA Students (AS 30,31 & 32) Date & Day 16th January 2011 (Sunday) Timing 10.00AM – 01.00PM Venue ICAI Bhawan, Auditorium, Vishwas Nagar, Shahdara, Delhi Fees No Fee. Limited Seats. Entry on First Cum First Serve only th Date & Day 20 December, 2010 (Monday) Timing 05.00 PM–09.00 PM Venue Hotel Swati Delux Gurudwara Road Karol Bagh, New Delhi-110 005 Date & Day Fees Rs. 350/Free for All Study Group Members of NIRC of ICAI Timing 09.30 AM - 05.30 PM Venue Hotel Suryaa (Formerly Hotel Crowne Plaza), New Friends Colony, New Delhi Fees Rs. 1500/- for Members Rs. 2000/- for Non Members (Corporate Delegates) Free for All Study Group Members of NIRC of ICAI Three Day Workshop on various Audits in Banking Sector Date & Day 21st- 23rd December, 2010 (Tuesday-Thursday) Timing 05.30 PM–09.30 PM Venue Auditorium of Institution of Engineers, IP Marg, Near ICAI Bhawan, ITO, New Delhi Fees Rs. 1000/- for full workshop of three days Free for All Study Group Members of NIRC of ICAI Discussion on Capital Gains on Real Estate Transactions (Organized by G-19, Bar Room Committee of NIRC) Date & Day 03.00 PM - 05.00 PM Venue G-19, Bar Room, CR Building, ITO No Fee. Limited Seats. Entry on First Cum First Serve only International Conference for CA. Students th th Date & Day 28 -29 December, 2010 (Tuesday-Wednesday) Timing 09.30 AM–05.30 PM Venue Auditorium of Shri Ram College of Commerce, Delhi University, Maurice Nagar, New Delhi Fees Rs. 500/- per students- For Students from India US$ 30 participants without accommodation–for Overseas participants 22nd January, 2011, (Saturday) Seminar for NGO’s Date & Day th 5 February, 2011 (Saturday) Timing 09.30 AM - 05.30 PM Venue Hotel Suryaa (Formerly Hotel Crowne Plaza), New Friends Colony, New Delhi Fees Rs. 1500/- for Members Rs. 2000/- for Non Members (Corporate Delegates) Free for All Study Group Members of NIRC of ICAI 23rd December, 2010 (Thursday) Timing Fees Seminar on Insurance-the Emerging Opportunity & Company Law (Oppression & Mismanagement) Seminar on Direct Tax th Date & Day 19 February, 2011 (Saturday) Timing 09.30 AM – 03.00 PM Venue Hotel Le Meridien, Janpath, New Delhi Fees Rs. 1500/- for Members Rs. 2000/- for Non Members (Corporate Delegates) Free for All Study Group Members of NIRC of ICAI Annual Function of NIRC of ICAI Date & Day 19th February, 2011 (Saturday) Timing 03.00 PM - 05.30 PM Venue Hotel Le Meridien, Janpath, New Delhi DECEMBER, 2010 NIR C NEWSLETTER 19 NIRC GLIMPSES – REGIONAL COUNCIL ACTIVITIES A view at the Two Day Residential Programme A view at the Full Day Conference on FEMA A view at the Seminar on Appeal before CIT & on Company Law held between 12th and 14th held on 20th November, 2010 at New Delhi CIT at G-19 Bar Room of NIRC held on 26th November, 2010 at Jim Corbett National Park November, 2010 at New Delhi A view at the Seminar on Corporate A view at the Cricket Tournament-Torrence Cup A view at the Full Day Conference on IFRS held Governance & Capacity Building of CA. Firm 2010 held on 27th November, 2010 at jointly with Shriram College of Commerce on on 27th November, 2010 at New Delhi New Delhi 28th November, 2010 at New Delhi A view at the Seminar on Personality A view at the Fourth Days Training Workshop A view at the Seminar on Financing-Emerging Development held Jointly with North Campus on Audit Excellence held on 3rd to 6th Trends and New Dimension held on 4th Study Circle held on 29th November, 2010 at December, 2010 at Scope Complex, New Delhi December, 2010 at New Delhi New Delhi A view at the Family Workshop on Healthy Living held on 5th December, 2010 at New Delhi DL(C)-01/1192/09-11 U(C) - 257/2009-11 Licensed to post without prepayment Posted At N.D. P.S.O., New Delhi-110002, on December 11-12, 2010 R. N. I. No. 21759/71 FORTHCOMING PROGRAMME INTERNATIONAL CONFERENCE OF CA STUDENTS Organised By NORTHERN INDIA REGIONAL COUNCIL Jointly with Board of Studies The Institute of Chartered Accountants of India on Tuesday & Wednesday, the 28th & 29th December, 2010 from 9.00 am - 5.30 pm Cultural Evening by CA Students on 28th December, 2010 (from 6.00 PM onwards) followed by Dinner FIRST TECHNICAL SESSION Global Convergence FOURTH TECHNICAL SESSION Legal Reforms - Steering Indian Ahead SECOND TECHNICAL SESSION Ushering an Era of Taxation Reforms FIFTH TECHNICAL SESSION Present Global Financial Order THIRD TECHNICAL SESSION IT as Tool to Simplify Audit Process Fee Rs. 500/- (For Students from India) US $ 30 for Overseas Participants without Accommodation US $ 100 for Overseas Participants with Accommodation for two Nights VENUE: Shri Ram College of Commerce, University of Delhi, North Campus, Delhi (India) 20 NIRC Newsletter - December 2010