MCA Notifications Dated 09/09/2024: Key Amendments to the IEPF and Indian Accounting Standards.
The Ministry of Corporate Affairs (MCA) issued two important notifications on September 9, 2024, introducing amendments to the Investor Education and Protection Fund (IEPF) and Indian Accounting Standards.
Investor Education and Protection Fund (IEPF) Authority (Accounting, Audit, Transfer, and Refund) Second Amendment Rules, 2024:
Key changes under this notification include:
- Expansion to Securities: The provisions now apply to all securities, not just shares.
- Transmission Of Securities Without Nomination:
- Legal Heir Certificate: Legal heirs can submit a certificate issued by a revenue authority (rank of Tahsildar or above) for the transmission of securities. Additional requirements include:
- For singly held physical securities: A notarized indemnity bond from the claimant and a no-objection certificate (NOC) from all other legal heirs.
- For jointly held physical/demat securities or singly held dematerialized securities: A notarized indemnity bond from the legal heir/claimant and a NOC from all non-claimants.
- Submission of Will: A notarized indemnity bond must accompany the will for transmission.
- Valuation of Securities: The amendment specifies how securities will be valued.
- Loss of Physical Securities:
- FIR or police complaint is mandatory only if the market value of the lost securities exceeds ₹5 lakhs.
- NRIs or foreign nationals can submit a self-declaration (notarized/apostilled/consularized) along with their passport and overseas address proof.
- The requirement for a Surety Affidavit has been removed.
- An advertisement for lost securities can now be placed in any widely circulated newspaper.
- Insurance for Contingencies: A special insurance policy must be obtained to cover risks related to IEPF-5 claim verifications.
Companies (Indian Accounting Standards) Second Amendment Rules, 2024:
This amendment focuses on Ind AS 116, related to Sale and Leaseback Transactions. The key updates include:
- Introduction of Paragraph 102A: This deals with how a seller-lessee should determine ‘lease payments’ or ‘revised lease payments’ when there is a right-of-use asset and lease liability from a leaseback.
- The notification includes detailed illustrations explaining sale and leaseback transactions with fixed payments and above-market terms.
These amendments provide clarity and streamline processes related to securities, loss reporting, and accounting standards.
Disclaimer: This article provides general information existing at the time of preparation and we take no responsibility to update it with the subsequent changes in the law. The article is intended as a news update and Affluence Advisory neither assumes nor accepts any responsibility for any loss arising to any person acting or refraining from acting as a result of any material contained in this article. It is recommended that professional advice be taken based on specific facts and circumstances. This article does not substitute the need to refer to the original pronouncement
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