SBO

 

MCA Adjudication Order Against RDTMT Steels (India) Pvt. Ltd.: A Significant Beneficial Ownership Compliance Failure

The Registrar of Companies (RoC), Karnataka, acting as Adjudicating Officer under Section 454 of the Companies Act, 2013, has imposed penalties on RDTMT Steels (India) Private Limited, its Significant Beneficial Owner (SBO), and several directors for non-compliance with the Significant Beneficial Ownership (SBO) provisions contained in Section 90 of the Companies Act, 2013.

The order serves as an important reminder of the Ministry of Corporate Affairs' continuing focus on ownership transparency and corporate governance.

Background: The SBO Framework

The concept of Significant Beneficial Ownership was introduced to identify the natural persons who ultimately own or control companies, even where such ownership is held through layers of entities, trusts, Hindu Undivided Families (HUFs), or other indirect arrangements.

The SBO regime was strengthened through the Companies (Significant Beneficial Owners) Rules, 2018 and subsequent amendments in 2019. The objective was to improve transparency, prevent misuse of corporate structures, and align India's corporate governance framework with global anti-money laundering and beneficial ownership disclosure standards.

Under Section 90 of the Companies Act:

• Individuals qualifying as SBOs must submit a declaration in Form BEN-1.
• Companies must identify SBOs and obtain the required declarations.
• Companies must file Form BEN-2 with the Registrar of Companies within the prescribed timeline.
• Failure to comply attracts substantial monetary penalties for both the company and the persons in default.

Facts of the Case

During examination of the company's annual return for FY 2022-23, the RoC observed that Mr. Sanjay Kumar Agarwal held a direct shareholding of 24.71% and an additional indirect interest through a Hindu Undivided Family (HUF), resulting in a beneficial interest exceeding the statutory threshold for classification as a Significant Beneficial Owner.

Accordingly, Mr. Agarwal was required to submit a declaration in Form BEN-1, and the company was required to identify the SBO, obtain the declaration, and file Form BEN-2 with the RoC.

However, the company failed to complete these compliance requirements within the prescribed timelines. Although the beneficial interest existed from August 2016, the required BEN-1 declaration and BEN-2 filing were made only on 1 August 2024, several years after the statutory deadlines.

Regulatory Findings

The Adjudicating Officer concluded that:

1. The SBO failed to file Form BEN-1 within the prescribed period.
2. The company failed to identify the SBO and secure the required declaration.
3. The company failed to file Form BEN-2 within the prescribed timeline.
4. The directors responsible for compliance were liable as officers in default.

The RoC rejected any possibility of reduced penalties available to small companies because RDTMT Steels did not qualify as a small company under Section 2(85) of the Companies Act due to its paid-up capital levels.

Penalties Imposed

Penalty on the Significant Beneficial Owner

Mr. Sanjay Kumar Agarwal was penalised for failure to furnish the required SBO declaration. While the calculated penalty exceeded the statutory cap, the maximum permissible penalty of ₹2 lakh was imposed.

Penalties for Failure to Identify and Report SBO

The following penalties were imposed under Section 90(11):

Noticee	Penalty
RDTMT Steels (India) Pvt. Ltd.	₹5,00,000
Sanjay Kumar Agarwal (Director)	₹1,00,000
Pradeep Agarwal (Former Director)	₹1,00,000
Rajesh Kumar Agarwala (Director)	₹1,00,000
Sunny Agarwal (Director)	₹90,800
Anand Agarwal (Director)	₹90,800

The aggregate penalties imposed exceed ₹11.8 lakh, demonstrating the significant financial consequences of prolonged SBO non-compliance.

Key Takeaways

1. SBO Compliance Is Not Merely Procedural

The order underscores that SBO disclosures are a core corporate governance requirement rather than a routine filing obligation. Regulators increasingly view beneficial ownership transparency as essential to combating opaque ownership structures.

2. Companies Have an Independent Obligation

A common misconception is that compliance rests solely with the beneficial owner. Section 90 places a parallel responsibility on companies to actively identify SBOs and secure the required declarations.

3. Directors Face Personal Liability

The order highlights that directors can face personal monetary penalties for compliance failures, even where the company itself is also penalised.

4. Long Delays Can Result in Significant Exposure

The violations in this case continued for several years. Since penalties accrue on a continuing-default basis, delays in rectification can substantially increase financial liability.

Conclusion

The adjudication order against RDTMT Steels (India) Private Limited reflects the MCA's increasingly stringent enforcement of beneficial ownership disclosure requirements. As regulatory scrutiny intensifies, companies must periodically review their shareholding structures, identify potential Significant Beneficial Owners, obtain timely BEN-1 declarations, and ensure prompt filing of BEN-2 returns.

For corporate compliance teams, the message is clear: SBO compliance is no longer a box-ticking exercise but a critical component of governance, transparency, and regulatory risk management.

FEM (Deposit) Amendment Regulations 2026

 

RBI Expands the Scope of Special Non-Resident Rupee (SNRR) Accounts: Key Highlights of the Sixth Amendment to FEMA Deposit Regulations, 2026

The Reserve Bank of India (RBI), through Notification No. FEMA 5(R)(6)/2026-RB dated June 18, 2026, has amended the Foreign Exchange Management (Deposit) Regulations, 2016. While the amendments appear technical, they represent another significant step towards simplifying the regulatory framework governing Special Non-Resident Rupee (SNRR) Accounts, facilitating cross-border transactions, and strengthening India's aspirations of making the Indian Rupee a more globally accepted currency.

Historical Background

India's foreign exchange regulatory framework has evolved considerably since the enactment of the Foreign Exchange Management Act, 1999 (FEMA), which replaced the restrictive Foreign Exchange Regulation Act (FERA). FEMA shifted the regulatory philosophy from one of control to one of facilitation, enabling greater participation of foreign investors and businesses in the Indian economy.

As international trade and investment expanded, the RBI introduced the Special Non-Resident Rupee (SNRR) Account in 2016 to facilitate permissible current and capital account transactions by non-residents. Over time, the account has become an important instrument for foreign investors, multinational corporations, overseas financial institutions and entities operating in India's International Financial Services Centres (IFSCs).

The present amendment continues this gradual liberalisation by enhancing operational flexibility and removing procedural constraints.

Key Changes

The Sixth Amendment introduces several important changes:

• Recognition of IFSCs: The regulations now expressly recognise branches of authorised dealers operating in an International Financial Services Centre (IFSC), allowing SNRR accounts to be maintained through such branches.

• Expanded Scope of SNRR Accounts: The amended provisions permit SNRR accounts to be used not only for permissible transactions with residents in India but also for bona fide transactions with persons resident outside India, subject to the applicable FEMA framework.

• Simplification of Schedule 4: Several existing paragraphs governing SNRR accounts have been deleted, indicating RBI's intent to streamline the regulatory framework and reduce unnecessary operational prescriptions.

• Greater Flexibility in Fund Transfers: The amendments expressly permit transfers between NRO, NRE and SNRR accounts within the limits prescribed under the FEMA Remittance of Assets Regulations, providing greater flexibility in fund management for eligible non-residents.

• Transactions Between Non-Residents: A new provision enables authorised dealer banks to process transactions between two non-residents involving SNRR accounts based on the account holder's mandate specifying the underlying purpose, where such transactions are otherwise outside FEMA compliance requirements.

Why These Amendments Matter

The amendments align with the RBI's broader objective of promoting ease of doing business, encouraging greater use of the Indian Rupee in international transactions, and strengthening India's position as a global financial centre through IFSCs.

For banks, the revised framework simplifies account operations. For foreign investors and multinational businesses, it provides greater flexibility in managing rupee-denominated transactions. The changes also complement India's ongoing efforts to deepen cross-border financial markets and enhance the attractiveness of IFSCs as international financial hubs.

Conclusion

Although the Sixth Amendment does not introduce an entirely new regulatory framework, it represents another incremental yet meaningful step in the continuing liberalisation of India's foreign exchange regime. By simplifying the operation of SNRR accounts, recognising the growing importance of IFSCs, and facilitating a wider range of permissible transactions, the RBI has reinforced its commitment to creating a more efficient, flexible and internationally competitive financial ecosystem.

non filing of financial statements

 

Analysis of the Order of Adjudication

In the matter of Futemind Technologies Private Limited
Registrar of Companies, Karnataka
Order dated: 23 April 2026

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Executive Summary

This document is an Order of Adjudication issued by the Registrar of Companies, Karnataka, acting as the Adjudicating Officer under Section 454 of the Companies Act, 2013, for contravention of Section 137 relating to the filing of financial statements.

The order finds that Futemind Technologies Private Limited failed to file its statutory financial statements in Form AOC-4 for four consecutive financial years—FY 2019–20, FY 2020–21, FY 2021–22, and FY 2022–23. Since neither the company nor its officers responded to the show-cause notice issued by the Registrar, the proceedings culminated in an ex parte adjudication, resulting in the imposition of substantial monetary penalties upon both the company and its directors.

The total penalties imposed amount to:

• Company: ₹6,04,600
• Managing Director: ₹2,00,000
• Director: ₹2,00,000

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Historical and Legal Background

Section 137 of the Companies Act, 2013 represents one of the fundamental compliance provisions governing corporate transparency in India.

Every company is statutorily obligated to:

• prepare annual financial statements;
• place them before the shareholders in the Annual General Meeting (AGM); and
• file the approved financial statements with the Registrar of Companies within thirty days through Form AOC-4.

The legislative objective is straightforward: ensuring that creditors, investors, regulators and the public have access to reliable financial information concerning companies.

Failure to file financial statements undermines regulatory oversight and therefore attracts continuing penalties under Section 137(3). The adjudication mechanism under Section 454 enables the Registrar to impose civil penalties without resorting to lengthy criminal prosecution.

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Factual Matrix

The order records that:

• Futemind Technologies Private Limited was incorporated on 9 October 2015.
• The company failed to file financial statements for:
  • FY 2019–20
  • FY 2020–21
  • FY 2021–22
  • FY 2022–23
• A Show Cause Notice was issued on 16 February 2024.
• No explanation or representation was submitted by either the company or its officers.
• Consequently, the Registrar proceeded ex parte under Rule 3(11) of the Companies (Adjudication of Penalties) Rules, 2014.

The order therefore rests primarily on documentary evidence maintained in MCA records rather than contested factual issues.

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Legal Analysis

The order refers to:

• Section 137(1)
• Section 137(2)
• Section 137(3)
• Section 454
• Rule 12 of the Companies (Accounts) Rules, 2014
• Companies (Adjudication of Penalties) Rules, 2014

The legal reasoning follows the statutory sequence from the filing obligation, the default, issuance of notice, adjudication, and finally computation of penalty.

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A significant legal feature of the order is its recognition that non-filing of financial statements constitutes a continuing default.

The Registrar computes penalties from the respective due dates of filing until the date of adjudication, subject to the statutory maximum prescribed under Section 137(3).

This approach is entirely consistent with the legislative framework.

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The Registrar specifically examines whether the company could claim the benefit of reduced penalties available to small companies under Section 446B.

The order concludes that:

• the company is a holding/subsidiary company; and
• therefore does not qualify as a "small company".

Consequently, no reduction in penalties was available.

The adjudicating authority notes that despite issuance of the Show Cause Notice, no reply was received.

Rather than indefinitely postponing proceedings, the Registrar exercised powers under Rule 3(11) to decide the matter ex parte.

This reflects adherence to principles of natural justice, since adequate opportunity to respond had already been afforded.

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The penalties imposed are proportionate to the statutory formula.

Noticee	Penalty
Company	₹6,04,600
Managing Director	₹2,00,000
Director	₹2,00,000

The Registrar separately computes penalties for each financial year and aggregates them, while ensuring that statutory ceilings are respected.

Compliance Directions

The order directs the noticees to:

• pay the penalties within 90 days;
• file Form INC-28 together with proof of payment;
• ensure directors pay penalties from their personal funds; and
• comply with the adjudication order to avoid further proceedings under Section 454(8).

The order also preserves the statutory right of appeal before the Regional Director (South West Region), Bengaluru within 60 days.

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Professional Review

From a governance perspective, the order underscores that prolonged non-filing of financial statements is treated as a serious compliance lapse with financial and reputational consequences for both companies and their officers. The decision serves as a reminder that directors bear personal responsibility for ensuring adherence to statutory filing obligations and may incur individual liability in the event of persistent defaults.

Overall, the order is legally coherent, procedurally fair, and consistent with the enforcement objectives of the Companies Act, making it an effective illustration of the MCA's adjudicatory approach to recurring compliance violations.

IBC vs Benami

The article "IBC v. Benami Act: Who Wins the Tussle? Will Two Swords Fit in One Scabbard?" in Corporate Professionals Today Volume 66, Issue, May 9 to 15, 2026 presents a thoughtful and analytically rigorous examination of one of the more nuanced conflicts in contemporary Indian insolvency jurisprudence—the apparent collision between the provisions of the Insolvency and Bankruptcy Code, 2016 (IBC) and the Prohibition of Benami Property Transactions Act, 1988 (Benami Act). Anchored around the landmark Supreme Court decision in S. Rajendran v. Deputy Commissioner of Income Tax (Benami Prohibition), the article explores the extent to which insolvency proceedings can coexist with sovereign enforcement actions against benami properties.

One of the article's principal strengths lies in its methodical organisation. It begins by setting out the legislative framework governing both statutes before tracing the factual background that culminated in the Supreme Court's ruling. The discussion then proceeds through the competing statutory objectives, the jurisdictional issues surrounding the National Company Law Tribunal (NCLT) and the National Company Law Appellate Tribunal (NCLAT), the scope of the IBC's overriding clause under Section 238, and the implications of attachment proceedings initiated under the Benami Act. This structured approach enables the reader to appreciate not merely the outcome of the judgment but also the legal reasoning that underpins it.

The author demonstrates an impressive command over insolvency jurisprudence and constitutional principles governing statutory interpretation. Rather than treating the issue as a simple conflict between two enactments, the article carefully distinguishes between private insolvency rights and the sovereign powers of the State to investigate, attach, and confiscate property acquired through benami transactions. In doing so, it highlights the Supreme Court's reaffirmation that the Benami Act operates in a distinct legislative sphere and that challenges to proceedings under that statute cannot ordinarily be entertained before forums constituted under the IBC.

Particularly noteworthy is the discussion on the limits of the NCLT's jurisdiction. The article explains with clarity why insolvency tribunals, despite exercising extensive powers over corporate insolvency resolution and liquidation, cannot assume appellate or supervisory jurisdiction over proceedings initiated by statutory authorities under special legislation. This analysis reinforces the broader constitutional principle that specialised tribunals must operate within the confines of the jurisdiction expressly conferred upon them by Parliament.

The article also succeeds in placing the judgment within the wider framework of evolving insolvency law. By examining earlier judicial pronouncements involving conflicts between the IBC and other sovereign statutes—particularly those concerning attachment, confiscation, and public interest—the author illustrates that the present decision forms part of a larger judicial trend recognising that insolvency legislation, however comprehensive, does not automatically override every special enactment enacted to protect public revenue or combat economic offences. This contextual treatment significantly enhances the article's scholarly value.

From a stylistic perspective, the writing strikes an appropriate balance between academic depth and practical accessibility. The language is precise without becoming unnecessarily technical, making the article equally useful for insolvency professionals, advocates, chartered accountants, company secretaries, bankers, and corporate advisors. Complex statutory provisions and judicial reasoning are explained in a logical sequence, allowing even readers who are not specialists in insolvency law to follow the legal developments with ease.

Another commendable aspect is the article's balanced and objective tone. Rather than advocating for one statutory regime over the other, it critically analyses the reasoning adopted by the Supreme Court and evaluates its practical implications for resolution professionals, creditors, corporate debtors, and enforcement agencies. This measured approach lends credibility to the analysis and reflects sound legal scholarship.

Overall, the article is an authoritative and well-researched contribution to the literature on Indian insolvency law. It successfully transforms a technically intricate jurisdictional conflict into a coherent and engaging legal analysis while remaining firmly grounded in statutory interpretation and judicial precedent. The article will be of considerable value to legal practitioners, insolvency professionals, academics, financial institutions, and policymakers seeking to understand the evolving relationship between insolvency proceedings and sovereign enforcement mechanisms. It is both intellectually rigorous and practically relevant, making it a noteworthy addition to contemporary legal discourse on the interface between the IBC and special economic legislation.

SNRR account

 

Legal Analysis and Professional Review

Document: Circular F. No. IFSCA-FMPP0BR/4/2024-Banking
Issuing Authority: International Financial Services Centres Authority (IFSCA)
Date: 19 June 2026
Subject: Amendment to the Circular titled "Permissible transactions through the Special Non-Resident Rupee (SNRR) accounts of IFSC units – Amendment"

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Executive Summary

The Circular is a regulatory amendment issued by the International Financial Services Centres Authority ("IFSCA") to harmonize the operational framework governing Special Non-Resident Rupee (SNRR) Accounts maintained by financial institutions established in an International Financial Services Centre (IFSC).

Rather than introducing an entirely new regulatory regime, the Circular substitutes Clause 3 of an earlier circular dated 29 January 2025 in light of subsequent amendments made to the Anti-Money Laundering, Counter-Terrorist Financing and Know Your Customer (AML/CFT/KYC) Guidelines on the same date, namely 19 June 2026.

The amendment principally seeks to:

• facilitate smoother conduct of business transactions undertaken outside the IFSC;
• maintain regulatory oversight over the movement of funds;
• preserve India's foreign exchange management framework; and
• balance operational flexibility with AML/CFT safeguards.

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Historical Background

Genesis of the SNRR Account Framework

The Special Non-Resident Rupee (SNRR) Account was originally conceptualized under the foreign exchange regime administered by the Reserve Bank of India.

Unlike ordinary rupee accounts, SNRR accounts enable eligible non-resident entities to undertake specific rupee-denominated transactions connected with legitimate business activities.

With increasing internationalisation of IFSC operations, practical difficulties arose because many business transactions generated rupee receipts outside the IFSC ecosystem.

Accordingly:

• regulatory amendments notified on 14 January 2025 permitted IFSC units to maintain SNRR accounts with authorised dealers outside the IFSC;
• the present Circular further refines that framework by prescribing the permissible utilisation and remittance of such funds.

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Legislative Framework

The Circular derives statutory authority from:

• Sections 12 and 13 of the International Financial Services Centres Authority Act, 2019, empowering IFSCA to regulate financial institutions and financial services within the IFSC.

It also operates alongside:

• Foreign Exchange Management regulations governing SNRR Accounts;
• IFSCA AML/CFT/KYC Guidelines;
• Earlier SNRR Circular dated 29 January 2025.

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Detailed Legal Analysis

1. Nature of the Amendment

The Circular does not create a fresh regulatory framework.

Instead, it expressly substitutes Clause 3 of the earlier SNRR Circular.

Legally, substitution replaces the previous provision in its entirety, ensuring that the revised clause becomes the operative regulatory text.

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2. Recognition of Business Outside IFSC

The amendment expressly recognises that an IFSC financial institution may undertake:

• business-related activities outside the IFSC; and
• receive monetary consideration through an SNRR account maintained with an authorised dealer in India outside the IFSC.

This represents an important policy shift towards operational flexibility.

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3. Permissible Credits

The Circular clarifies that the SNRR account may receive:

• fees;
• funds;
• monetary consideration;
• other amounts arising from business transactions outside the IFSC.

The language is deliberately broad, reducing interpretational disputes regarding permissible credits.

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4. Mandatory Repatriation Requirement

The principal regulatory safeguard introduced is the obligation that amounts received must be transferred to the financial institution's account maintained with an IFSC Banking Unit (IBU) in a specified foreign currency within 30 working days of receipt.

From a legal perspective, this requirement serves multiple objectives:

• limiting prolonged retention of domestic rupee balances;
• preserving foreign exchange discipline;
• strengthening regulatory audit trails; and
• mitigating money laundering risks.

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5. Administrative Expense Exception

The Circular carves out an express exception:

Amounts credited solely for administrative expenses are exempt from the mandatory remittance requirement.

This is a pragmatic provision recognising that routine operational expenditure—such as salaries, rent, utilities, professional fees, or statutory payments—may legitimately require the maintenance of rupee balances.

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6. Immediate Effect

The Circular comes into force immediately upon issuance.

Accordingly, all regulated entities are expected to comply without any transitional period.

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Legal Significance

The Circular advances several regulatory objectives:

Operational Efficiency

Financial institutions are no longer required to adopt cumbersome mechanisms for routing business receipts generated outside the IFSC.

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Regulatory Consistency

The amendment aligns the SNRR framework with contemporaneous amendments made to the AML/CFT/KYC Guidelines.

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Foreign Exchange Discipline

The 30-working-day remittance requirement ensures that domestic rupee balances remain temporary rather than permanent.

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AML/CFT Compliance

Prompt remittance to IFSC Banking Units creates a transparent audit trail, thereby reducing opportunities for misuse.

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Practical Implications for Regulated Entities

Financial institutions operating in IFSCs should:

• review treasury policies;
• monitor SNRR account balances regularly;
• establish internal controls to ensure remittance within the prescribed timeframe;
• document administrative expense payments separately;
• maintain adequate records to demonstrate regulatory compliance.

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Overall Professional Review

From a legal and regulatory perspective, this Circular is a well-crafted, narrowly tailored amendment that reflects the continuing evolution of India's IFSC regulatory framework. Rather than imposing additional compliance burdens, it provides greater operational flexibility while reinforcing safeguards essential to foreign exchange management and anti-money laundering compliance.

The amendment strikes a measured balance between facilitating legitimate commercial activity and preserving regulatory oversight. By allowing IFSC financial institutions to receive business-related receipts through SNRR accounts while mandating their timely remittance to IFSC Banking Units—subject to a sensible exemption for administrative expenses—it enhances both commercial efficiency and supervisory transparency.

Overall Assessment: The Circular represents a pragmatic and progressive refinement of the existing regulatory framework. It aligns with the broader legislative objective of positioning India's IFSC as a globally competitive financial jurisdiction while maintaining robust standards of financial integrity, regulatory compliance, and foreign exchange discipline. It is an example of principle-based regulation that facilitates business without compromising supervisory control.

investment advisor

 This SEBI Circular (HO/38/12/11(5)2026-MIRSD-POD/I/14660/2026 dated June 24, 2026) introduces a significant regulatory relaxation aimed at simplifying certification requirements for certain categories of Persons Associated with Investment Advice (PAIA). The circular reflects SEBI's continuing commitment to balancing investor protection with operational efficiency by adopting an "Ease of Doing Business" approach.

The principal amendment distinguishes between personnel who are actively engaged in rendering investment advice and those whose responsibilities are confined to sales, relationship management, and other non-core client-facing functions. While core advisory personnel must continue to obtain the existing NISM Series-X-A (Level 1) and Series-X-B (Level 2) certifications, staff performing only sales and non-core services are now permitted to qualify through the newly introduced NISM Series-XXV-B: Persons Associated with Investment Advice (Sales and Other Non-Core Services) Certification Examination. This targeted differentiation reduces the compliance burden on employees whose roles do not involve providing investment advice.

A noteworthy feature of the circular is its transitional provision. Existing PAIAs who have already obtained the Level 1 and Level 2 certifications are not required to immediately undertake the newly prescribed Series-XXV-B examination. Instead, they may continue relying on their current certifications until expiry, at which point the revised certification requirement becomes applicable. This grandfathering provision ensures a smooth transition while avoiding unnecessary duplication of certification efforts.

Key Highlights

• Introduces a simplified certification regime for PAIAs performing only sales and non-core functions.
• Retains the existing two-tier certification framework for personnel directly involved in investment advisory activities.
• Provides transitional relief for currently certified personnel through a grandfathering mechanism.
• Reinforces SEBI's broader objective of promoting regulatory efficiency without diluting investor protection.
• Comes into force with immediate effect.

Overall Assessment

This circular represents a pragmatic and business-friendly regulatory reform. By aligning certification requirements with the actual nature of employees' responsibilities, SEBI has reduced avoidable compliance costs while preserving rigorous qualification standards for professionals engaged in investment advice. The distinction between advisory and non-advisory roles is likely to improve operational flexibility for registered Investment Advisers without compromising regulatory oversight or investor interests.

Overall, the circular is a well-calibrated measure that advances SEBI's ongoing agenda of ease of doing business through proportionate regulation, while maintaining the integrity and professionalism expected within the investment advisory ecosystem.

Digital Frauds

 The Reserve Bank of India (Commercial Banks – Responsible Business Conduct) Third Amendment Directions, 2026 represents a substantial overhaul of the regulatory framework governing customer protection in cases of fraudulent electronic banking transactions. Applicable to transactions undertaken on or after 1 January 2027, the Directions replace the existing provisions on customer liability and introduce a more detailed and structured regime covering card-present and card-not-present transactions, internet banking, mobile banking, and other electronic payment channels.

A notable feature of the amendment is its stronger emphasis on customer protection and accountability of banks. Customers will enjoy zero liability in cases where fraud arises due to negligence or deficiencies on the part of the bank, including system failures, security breaches, failure to send transaction alerts, or inadequate fraud-reporting mechanisms. Similarly, customers affected by third-party breaches will be entitled to full reversal of fraudulent transactions if the incident is reported within five calendar days. The burden of proving customer negligence has been expressly placed on banks, marking a significant shift in favour of consumer protection.

The Directions also introduce several operational safeguards. Banks must provide 24×7 channels for reporting fraud, issue instant SMS alerts for transactions exceeding ₹500, send email notifications wherever available, acknowledge complaints immediately, and complete investigation and liability determination within prescribed timelines of 45 days for domestic frauds and 60 days for cross-border cases. Credit card customers are additionally protected through a mandatory “shadow reversal” mechanism, requiring provisional credit within five days of reporting a fraudulent transaction.

Perhaps the most innovative aspect of the amendment is the introduction of a compensation framework for bona fide victims of small-value digital frauds. Individual customers suffering losses of up to ₹50,000 due to fraudulent electronic banking transactions may receive compensation of 85% of the net loss, subject to a maximum of ₹25,000, provided the fraud is reported both to the bank and the National Cyber Crime Reporting Portal or Helpline 1930 within five days. The compensation cost is shared among the RBI, the customer’s bank, and, where applicable, the beneficiary bank, demonstrating a collaborative approach to addressing digital fraud risks.

Overall, the amendment reflects RBI’s proactive response to the rising incidence of digital payment frauds. By combining enhanced customer safeguards, stricter obligations on banks, structured compensation mechanisms, and board-level oversight of fraud-related complaints, the Directions seek to strengthen public confidence in India's rapidly expanding digital banking ecosystem while promoting greater responsibility and resilience across the banking sector.

buy back

The SEBI Board has approved amendments to the SEBI (Buy-back of Securities) Regulations, 2018, aimed at enhancing flexibility in buy-back mechanisms, simplifying compliance requirements, reducing procedural costs, and strengthening investor protection.

Key amendments include the reintroduction of open market buy-backs through stock exchanges with effect from 1 August 2026, in addition to the existing tender offer and book-building routes. To improve shareholder awareness, companies undertaking such buy-backs will be required to disseminate buy-back information electronically, alongside existing newspaper disclosures.

To prevent indirect participation by promoters, securities held by promoters and their associates will remain frozen at the ISIN level during the buy-back period. Further, all buy-backs will be required to comply with minimum public shareholding norms, and the interval between two buy-backs has been aligned with the provisions of the Companies Act, 2013.

In a significant ease-of-doing-business measure, the appointment of a Merchant Banker for buy-backs has been made optional. Where a company chooses not to appoint a Merchant Banker, the associated responsibilities will be discharged by the company, its compliance officer, statutory auditor, secretarial auditor, and stock exchanges.

The amendments are intended to streamline the buy-back framework, improve operational efficiency, reduce compliance costs, and reinforce safeguards against promoter dealings during the buy-back period.

Transmission of securities

 SEBI Board Meeting – Key Decisions Taken on 19 June 2026

1. Simplification and Standardisation of the Framework for Transmission of Securities

The Securities and Exchange Board of India ("SEBI"), at its Board Meeting held on 19 June 2026, approved a series of measures aimed at simplifying and streamlining the framework governing the transmission of securities upon the demise of an investor. The reforms are intended to facilitate faster and more efficient transmission of securities to legal heirs and other eligible claimants while reducing procedural complexities.

1.1 Introduction of Quick Transmission Processing (QTP)

SEBI has approved the introduction of a new category of Quick Transmission Processing (QTP) for small-value claims. Under this mechanism, transmission requests involving securities valued up to:

• ₹10,000 in the case of physical holdings; and

• ₹30,000 in the case of dematerialised holdings,

shall be processed through a simplified procedure with minimal documentation requirements, thereby enabling expeditious settlement of such claims.

1.2 Enhancement of Thresholds for Simplified Documentation

In order to extend the benefit of simplified documentation to a larger number of claimants, SEBI has approved the enhancement of the existing monetary thresholds as follows:

• From ₹5 lakh to ₹10 lakh per listed company in respect of physical holdings; and

• From ₹15 lakh to ₹30 lakh per beneficial owner in respect of dematerialised holdings.

1.3 Documentation and Procedural Simplifications

The revised framework incorporates several significant measures aimed at reducing the compliance burden on claimants while enhancing operational efficiency for intermediaries. Key changes include:

(a) Dispensation with the requirement of furnishing a Permanent Account Number (PAN), considering that PAN details are already available in the demat account opening records.

(b) Removal of the mandatory requirement to obtain Probate of a Will, in alignment with recent amendments to the applicable succession laws.

(c) Permission to submit a combined Affidavit-cum-No Objection Certificate (NOC) in lieu of separate affidavits and NOCs.

(d) Recognition of death certificates bearing a QR Code as valid documentary evidence, in addition to original or duly attested copies, thereby facilitating easier verification.

(e) In cases where death certificates are issued by foreign jurisdictions, provision of additional verification mechanisms through overseas branches of Indian banks or foreign banks maintaining correspondent banking relationships with Indian banks.

1.4 Expected Impact

The approved measures are expected to significantly simplify the transmission process, expedite claim settlement, reduce associated costs, and alleviate procedural hardships faced by legal heirs and claimants.

1.5 Stakeholder Consultation

The proposals were deliberated in consultation with the Industry Standards Forum for Registrars to an Issue and Share Transfer Agents (RTAs) and the Association of Mutual Funds in India (AMFI). The final framework also incorporates feedback received pursuant to the consultation paper issued by SEBI on 12 March 2026.

Creditor initiated insolvency

 Based on the article “Creditor-Initiated Insolvency: Cure or Catastrophe?” by Venkateshwara Perumal and Naganathan Iyer, published in Corporate Professionals Today (Vol. 66, May 16–22, 2026), here is a professional review:

Review: Creditor-Initiated Insolvency – Reform or Regulatory Overreach?

The article “Creditor-Initiated Insolvency: Cure or Catastrophe?” presents a thoughtful and incisive examination of the proposed Creditor-Initiated Insolvency Resolution Process (CIIRP) under the Insolvency and Bankruptcy Code framework. At a time when policymakers are searching for solutions to mounting delays within India's insolvency ecosystem, the authors offer a timely critique of a reform that promises efficiency but may ultimately aggravate the very problems it seeks to resolve.

The article begins by contextualising the proposal against the backdrop of increasing stress within the insolvency regime. The authors note the growing backlog of cases before the National Company Law Tribunal (NCLT), the elongation of resolution timelines, and the diminishing recovery rates that have raised concerns regarding the effectiveness of the Insolvency and Bankruptcy Code, 2016. Against this setting, CIIRP is introduced as a mechanism intended to incorporate elements of the Debtor-in-Possession (DIP) model while allowing creditors to initiate proceedings.

One of the article’s principal strengths lies in its structured analysis. The authors first revisit the original promise of the IBC and then systematically evaluate previous reform efforts, including the Pre-Packaged Insolvency Resolution Process (PPIRP), which achieved only limited success. This historical perspective lends credibility to their scepticism regarding another experimental framework being introduced without adequately addressing underlying structural issues.

The discussion on the design of CIIRP is particularly compelling. The authors argue that the model attempts to blend creditor control with debtor management, creating inherent contradictions in governance and accountability. They contend that allowing existing management to retain operational control while proceedings are creditor-driven may create conflicts of interest, increase litigation, and complicate decision-making. The article persuasively suggests that such a hybrid structure risks importing the weaknesses of both creditor-controlled and debtor-controlled systems without fully capturing the advantages of either.

Equally noteworthy is the comparative analysis of international Debtor-in-Possession regimes. Drawing lessons from jurisdictions such as the United States and Singapore, the authors demonstrate that successful DIP frameworks depend upon mature credit markets, sophisticated rescue financing mechanisms, and strong judicial oversight. The article convincingly argues that these preconditions are not yet sufficiently developed in India, making a straightforward transplantation of DIP-inspired concepts potentially problematic.

The article’s empirical orientation further strengthens its arguments. Rather than relying solely on theoretical concerns, the authors anchor their critique in available insolvency data, resolution statistics, and practical experience under existing mechanisms. This evidence-based approach enhances the article’s analytical rigour and makes its conclusions more persuasive.

Perhaps the most significant contribution of the article is its broader policy message. The authors caution against viewing procedural innovation as a substitute for institutional reform. They argue that persistent delays, judicial capacity constraints, and market inefficiencies cannot be resolved merely by introducing new insolvency processes. Instead, they advocate strengthening existing mechanisms and improving implementation before embarking on another major legislative experiment.

In conclusion, “Creditor-Initiated Insolvency: Cure or Catastrophe?” is a well-researched, logically argued, and highly relevant contribution to contemporary insolvency discourse. While its conclusions are decidedly critical of CIIRP, the critique remains balanced and grounded in evidence. The article succeeds in stimulating debate on the future direction of India's insolvency regime and serves as essential reading for insolvency professionals, corporate lawyers, policymakers, and academics interested in the evolution of the IBC framework.

Overall Assessment: An insightful and persuasive analysis that challenges the assumption that regulatory innovation alone can cure systemic inefficiencies. The article makes a compelling case for prioritising institutional strengthening over the introduction of yet another insolvency experiment.