1. Jet Airways Revival Hopes All But Over with Claims Totalling Rs 24,887 Crore
Hopes sank for a late-stage rescue of Jet Airways (India) Ltd on Thursday, with the grounded airline’s bankruptcy professional revealing creditor claims totalling Rs 24,887 crore, a burden few buyers will be willing to shoulder.
Financial creditors who have the first right to proceeds from a bankruptcy resolution have claimed Rs 10,231 crore, while 2,400 operational creditors have claimed Rs 12,372 crore.
The resolution professional (RP) of Jet Airways said that out of the Rs 24,887 crore claims, it has admitted claims of Rs 8,462.79 crore, all of them from financial creditors. Claims of about Rs 15,044 crore are under verification, while claims of Rs 1,380.82 crore were rejected.
(Source: Mint)
2. FM Rules Out Tweak in Super-Rich Tax
Standing firm on her proposal, Finance Minister Nirmala Sitharaman on Thursday advised foreign portfolio investors (FPI) to register themselves as a company to protect themselves from the super-rich surcharge. She also dispelled fears that the higher effective tax rate will lead to a flight of investors from India.
Replying to the debate on the Finance Bill in Lok Sabha, Sitharaman said that when FPIs register themselves as a trust, it means that they are a body of individuals, and hence, liable to pay higher surcharge on earning more than Rs 2 crore. However, such a surcharge is not applicable on companies.
(Source: Hindu BusinessLine)
3. Arvind Subramanian Sticks to Claim of Overestimated GDP
Sticking to his analysis that India's economic growth has been overestimated, Arvind Subramanian said he had raised doubts about the GDP numbers in 2015 when he was the chief economic adviser of the Modi government as he found inconsistency between projected growth and other macro indicators.
In a new paper 'Validating India's GDP Growth Estimates', the former CEA said he had indicated his doubts on the growth numbers in the Economic Survey in 2015 as well as mid-year Economic Analysis.
(Source: MoneyControl)
4. EY Finds No Major Lapses in Indigo Dealings After Gangwal Points Finger
An independent review of IndiGo’s related-party transactions has found no major procedural lapses by the company. The forensic review of the airline, done by consultancy firm EY, says all such transactions since its public listing were done at “arm’s length”, approved by the audit committee.
However, the report also notes instances where permission from the audit committee came after the transactions were executed. According to corporate law parlance, a transaction is said to be done at arm’s length when a proper tendering process has been followed.
(Source: Business Standard)
5. Centre Asks States to Help Give Electric Vehicles a Push
Close on the heels of unveiling a host of incentives for electric vehicles, the Union government is now urging states to promote eco-friendly vehicles in an effort to curb rampant pollution afflicting most of the major cities.
The ministry of road transport and highways has asked all states and Union territories (UTs) to provide incentives for electric vehicles (EVs).
In a letter to the principal secretaries (transport) and transport commissioners of the states and UTs on 17 July, the ministry has asked them to induct more EVs into public transportation fleets to reduce tailpipe emissions.
(Source: Mint)
6. Sebi Raises the Exit Barrier for Auditors
As part of its efforts to rid Corporate India of scams and frauds fuelled by financial opaqueness, SEBI is turning up the heat on auditors by making them more accountable. Financial auditors of a company will now not be able to casually resign without finalising the audit report for the full year if they have signed previous quarterly reports.
Besides, the auditors will have to provide proper reason for resignation and would have to state if the company was not sharing proper financial numbers for audit purpose.
(Source: Hindu BusinessLine)
7. IL&FS Senior Management Asked Icra for 'Desired Ratings': ED Probe
The Enforcement Directorate (ED) has found that ratings of the Infrastructure Leasing & Financial Services (IL&FS) group firms were upgraded on many occasions after the intervention of senior management seeking ratings review.
While changing the ratings of several companies, their financial stress was not taken into account by the rating agencies, the findings show, pointing to an absence of checks and balances, according to sources close to the development. ED is examining the role of credit rating agencies in connection with the IL&FS money laundering case.
According to the enforcement sleuths, then senior management of IL&FS including Ravi Parthasarathy, Arun Saha and Hari Sankaran used to hold discussions with ICRA’s analyst team to get "desired ratings".
(Source: Business Standard)
8. Tweaks in Companies Act to Make Fundraising Easier
Fundraising through various financial instruments may get easier for companies in the days to come with the Union government trying to reduce compliance rigours as part of its 100-day agenda, a person familiar with the development said.
The ministry of corporate affairs is working on a proposal that covers various financial instruments that come under the Companies Act, the person mentioned above said on condition of anonymity.
One such instrument is shares with differential voting rights (DVR), which companies can use to raise capital without ceding control.
(Source: Mint)
9. Shopclues Lays off 200 People: Sources
E-commerce platform ShopClues has laid off about 200 employees as it struggles to rein in costs in the hyper-competitive online shopping segment in India.
According to sources, ShopClues has sacked about 200 people as its efforts to find a buyer failed.
When contacted, a ShopClues spokesperson said the company has been steadily reducing its workforce mostly in operating functions as it leverages gains from technology.
"We have always been an employee first company and have ensured that impacted employees, if any, are out placed proactively," it added.
Recently, ShopClues was in talks with larger rival Snapdeal for a potential acquisition.
However, after weeks of due diligence Snapdeal decided against the acquisition as there are concerns regarding some of the findings emerging from the due diligence conducted by advisory firm EY.
There have been speculations that with the discussion failing to materialise, ShopClues - which has nearly 500 employees - would be forced to downsize rapidly to stay afloat.
(Source: PTI)
(At The Quint, we question everything. Play an active role in shaping our journalism by becoming a member today.)