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Student Company Secretary 1 February 2007

Training Orientation Programme

As per Company Secretaries Regulations, 1982 (amended the significance and methodology of training, business
from time-to-time) every student apart from passing the final environment, corporate culture, communication and
examination of the Institute is also required to possess the behavioural aspects. Keeping in view the above factors, the
practical experience and undergo practical training or be Council of the Institute has decided that students requiring to
exempted therefrom before becoming eligible to the Associate undergo training should compulsorily attend five days Training
Membership of the Institute. Students who do not possess Orientation Programme (TOP) before they are sponsored for
practical experience are required to undergo compulsorily 15 training. It has also been decided that henceforth students
months Management/Apprenticeship training. will be sponsored for training in the companies or with company
Most of the students commencing training are not aware of secretaries in practice as per the following schedule.

Activities Session1 Session 2 Session 3 Session - 4

Registration of students January 1 to March 01 to June 01 to September 01 to
for 15 months Training January 10 March 10 June 10 September 10
Organisation of TOP January 15 to March 15 to June 15 to September 15 to
January 24 March 24 June 24 September 24
Campus Interview January 25 to March 25 to June 25 to September 25 to
January 31 March 31 June 30 September 30
Commencement of February 01 April 01 July 01 October 01
Training Onwards Onwards Onwards Onwards
Completion of April 30* June 30* September 30* December 31*
Training Next Year Next Year Next Year Next Year
* If the student avails extra leave, the training will be extended accordingly.
Training Orientation Programme is a part of the 10. Usefulness of reading newspapers
Management/Apprenticeship training and is based on Guru 11. Self-assessment
Shishya Parampara. Training Orientation Programme will not SWOT analysis
only expose the students to the business environment and Career prospects
corporate functioning but would also help them in acquiring
the desired skill and confidence.
12. Writing of curriculum vitae
The Regional Councils will organize the Training Orientation
Programme from 15th to 24th of the four fixed months i.e. 13. Interview Techniques
January, March, June & September. 14. Career Planning
For effective interaction and participation, not more than 15. Computer-Internet/E-mail
40 students would be enrolled in each TOP. A fee of Rs. 400/ 16. File management
- per participant will be charged. 17. Organisation structure, role and functioning of Competition
The following topics will be included in the programme : Commission of India, CLB/NCLT, ROC, Stock Exchange,
1. Importance of Training
18. Usefulness of Professional Development Programmes.
2. Personality Development- Dress Code & How to carry
oneself 19. Code of Conduct
20. Future Prospects
3. Time Management
For helping the students to identify Companies or Company
4. Meaning of Professionals
Secretaries in practice for undergoing training, the Regional
5. Office Culture Councils would also arrange Campus Interviews, immediately
6. Communication Skill on conclusion of each TOP for on-the-spot selection of
Writing ability candidates. Such Campus Interviews will be organized during
Drafting of letters the four fixed months from March 25 to 31; June 25 to 30;
Speaking ability September 25 to 30 and January 25 to 31.
All students intending to commence Management/
7. Group discussion, Drafting of Minutes, Notices,
Apprenticeship training are advised to contact the respective
Resolutions etc.
Regional Councils for enrolling themselves for TOP. Only on
8. How to qualify professional examination successful completion of TOP, students would be sponsored
9. Managing under crisis for training by the Institute.

Student Company Secretary 2 February 2007

From The President

We must be silent before we can listen.

We must listen before we can learn.
We must learn before we can prepare.
We must prepare before we can serve.
We must serve before we can lead.
William Arthur Ward

Dear Students,
I feel extremely happy to address my maiden communication to you after taking over as the President
of this leading professional body of the country. I accept this honour with a great sense of humility,
mission and responsibility. I take this opportunity to place on record my sincere gratitude and
thanks to representatives on the Council and to all company secretaries for reposing trust and
confidence in me. I am proud to belong to a profession, which is highly sought after spreading its
wings beyond the national borders and thus contributing to the nations prominence in the world.
I feel especially gratified in talking to you who represent the future of the profession. It is an honour to communicate with the
younger generation fresh and pulsating with ideas, dreams, ambition and enthusiasm. No doubt, you have chosen to pursue a
profession that holds a great promise as a profession of the current century. I look upon you with great expectations that you
will persevere and perspire to realize our collective dream to make Company Secretaries profession, the profession of the
Before sharing my thoughts and perceptions, I wish to state that I have succeeded very dynamic, energetic and visionary Past
Presidents, who toiled tirelessly day and night and provided unparalleled fame, recognition and visibility to our profession and
the Institute. During my tenure as President, it will be my endeavor to make further efforts to build up the profession so as to
achieve greater heights in the dynamic global environment with the active involvement of Regional Councils/Chapters and the
vibrant Secretariat of the Institute.
Friends, needless to mention that we are living in a technologically surcharged, integrated global environment where changes
are taking place very frequently. The situation is fluid and dynamic. In this global race, one of the golden rules for success for a
professional is to keep pace with the changing environment around him and at the same time gear himself up for future changes
and the resulting challenges. Experts say that the key to retaining competitive advantage lies in keeping focused on three basic
business principles: i) be customer-driven; ii) adapt quickly to the changing environment; and iii) anticipate change and act today
to meet tomorrows challenges. In this age of intensive competition, only dedicated and committed professionals having vision
and capability to lead, can help the organizations to maintain a competitive edge. This requires working relentlessly with firm
purpose and will as well as expanding the horizons of knowledge to gain expertise in the field and to have an in-depth perception
about the industry and societal requirements, thus paving the way to real prosperity and progress. Since you are going to be our
future professionals, you should imbibe these fundamental principles not only in your professional career but also while pursuing
the CS Course. It is no longer sufficient for us to be the best in the country, we must be the best in the world.
Any Institution be it academic or professional, students are its life line. The same holds equally good for our Institute. During my
tenure, it will be my endeavour to provide 24 hours helpline for students and to pursue vigorously e-learning project to enable the
students even in smaller towns/cities to have access to the best of faculties by way of facilities like virtual class room; 72 hours
IT Course after passing the Foundation course and before appearing for the Intermediate examination; partnership with reputed
credible private institutions for oral coaching classes and amendment of CS Regulations to allow registration for 10+ students.
An early completion of the revision of the syllabus and the training requirements are also of utmost importance. The contents
of the syllabus and training system would be so devised as to provide our next generation Company Secretaries ample knowledge
and skills (including soft skills), necessary practical orientation and exposure to new techniques of rendering value added
professional services to serve all stakeholders more efficiently and effectively.
In order to attract more and more students to join the Company Secretaryship Course, we have to expand our reach to every
nook and corner of the country. In this direction, I propose to spread awareness about the Company Secretaryship course
especially in small towns and cities. I would make special endeavours to organise career awareness programmes in more and
more towns and cities across the country so that youth at those places is made aware of Company Secretaryship as a career
Communication is a means of linking people to achieve a common purpose. The ability to communicate is being rated the most
important factor in making an executive promotable than ambition, education and capacity for hard work. One can significantly
boost his marketability by seizing any academic and professional opportunities offered to him for honing his communication
skills. In this context, let me point out that the Institute every year through its Regional Councils /Chapters organises various
programmes for the students to enable them to hone their communication skills. Likewise this year also, the following National
level Competitions for the students will be organized-
l All India Elocution Competition
l All India Moot Court Competition

Student Company Secretary 3 February 2007

From The President
l All India Company Law Quiz
l All India Essay Writing Competition
l All India Students Conference
I hope you will actively participate in these programmes and benefit immensely from them.
The Institute has always made earnest efforts to secure new recognitions for its members, both in practice and in employment.
The year 2006 saw new recognitions accorded to our practising members by regulatory authorities and stock exchanges. Intensive
efforts would be continued for seeking increased opportunities and new recognitions for our members. For this, we vigorously
pursue with Ministries of Company Affairs, Finance, Labour, Commerce and Industry as also SEBI, NSE, BSE, Banks, Financial
Institutions, Income Tax, Excise, Customs, Service Tax and VAT Authorities and various other regulatory bodies. I am sure that
a number of such initiatives will bear fruit.
The Institute has various Chapters and Satellite Chapters spread all over the country to serve the students and members besides
enhancing the visibility of the profession and create desired awareness about the Company Secretaryship course in their adjoining
areas. Moreover, they are the extended arms of the Council in implementing its policy decisions. Their infrastructure would be
further strengthened to render value added services to members and students at their doorstep. It would, also be our endeavour
to strengthen the infrastructure and communication facilities upto Satellite Chapter level, so that they are adequately equipped to
spread the desired visibility for the profession.
Further, it will be our endeavour to strengthen the Spreading the Wings Programme by formulating International Secretarial
Standards, expanding the reach of IFCS and strengthening our collaboration with international organizations like World Bank,
Asian Development Bank, OECD, INSOL, New York Stock Exchange, London Stock Exchange, NASDAQ, etc. This will be
important for global recognition of the profession and will also create opportunities for Company Secretaries in international
At the Institute level, the focus will be on increasing brand building and creating more visibility, undertaking contemporary research
and bringing out quality publications in areas of topical importance to the profession and corporate sector.
I am pleased to inform you that one day National Seminar on Limited Liability Partnership Bill, 2006 was organised by the Institute
on January 27, 2007 at New Delhi. The Seminar was inaugurated by Shri Prem Chand Gupta, Honble Minister of Company
Affairs. Shri Jitesh Khosla, Joint Secretary, Ministry of Company Affairs, Shri U K Chaudhary, Senior Advocate, Shri T N Pandey,
Former Chairman, CBDT and Shri Sumant Batra, Kesar Dass B & Associates also addressed the delegates. At the Inaugural
Session of the National Seminar, Institutes publication titled Practitioners Guide to Consumer Protection Law was also released
at the gracious hands of Shri Prem Chand Gupta.
Friends, CCRT is organizing 17th Residential SMTP at ICSI- CCRT, Navi Mumbai commencing from 24th March to 8th April 2007.
The 17th Residential SMTP has been planned with special emphasis on Management Subjects and time-tested and well-appreciated
methodologies on imparting training including an input on Yoga and Meditation in the morning hours. In addition to the subjects
covered in any SMTP, there will be programes in the evening on topics of practical and general managerial relevance. I advise
you to avail of this unique opportunity. Attending Residential SMTP at CCRT will be an experience by itself for you as it provides
all the facilities enabling students to interact with the expert faculty, senior academics and corporate leaders.
To conclude, renowned professionals have said that success and accomplishment are not limited to those who are lucky. They
are available to anyone who chooses to be disciplined, focused, persistent, committed, positive and enthusiastic. Look behind the
scenes at the success of others. And youll clearly see how you can do it, too.

With best wishes,

Yours sincerely,


February 8, 2007

Student Company Secretary 4 February 2007

Academic Guidance
information in respect of such transactions to the Director within the
ACADEMIC GUIDANCE prescribed time.
Cash Transaction Report
INTERMEDIATE COURSE The Prevention of Money Laundering Act, 2002 and the Rules there
under require every intermediary to furnish details of the following cash
FINANCIAL MARKETS1 (A) All cash transactions of the value of more than rupees ten lakhs
or its equivalent in foreign currency.
MEASURES (B) All series of cash transactions integrally connected to each
other which have been valued below rupees ten lakhs or its equivalent
The Prevention of Money Laundering Act, 2002 (PMLA) has been in foreign currency where such series of transactions have taken place
brought into force with effect from 1st July 2005. within a month.
As per the provisions of the Act, every banking company, financial Cash Transaction Reports can be filed either in manual or electronic
institution (which includes chit fund company, a co-operative bank, a format. However, a reporting agency must submit all reports to FIU-IND
housing finance institution and a non-banking financial company) and in electronic format if it has the prescribed technical capability to do so.
intermediary (which includes a stock-broker, sub-broker, share transfer
agent, banker to an issue, trustee to a trust deed, registrar to an issue, It must be noted that every intermediary has to ensure reporting by
merchant banker, underwriter, portfolio manager, investment adviser all its branches/franchisees either in manual or electronic format. Thus,
and any other intermediary associated with securities market and an Intermediary has to adopt only one format for all its branches/
registered under section 12 of the Securities and Exchange Board of franchisees.
India Act, 1992) shall have to maintain a record of all the transactions; Suspicious Transaction Report
the nature and value of which has been prescribed in the Rules notified The Prevention of Money Laundering Act, 2002 and the Rules
under the PMLA. Such transactions include: notified thereunder require every intermediary to furnish details of
l All cash transactions of the value of more than Rs 10 lakhs suspicious transactions whether or not made in cash. Suspicious
or its equivalent in foreign currency. transaction means a transaction whether or not made in cash which,
l All series of cash transactions integrally connected to each to a person acting in good faith
other which have been valued below Rs 10 lakhs or its equiva- (a) gives rise to a reasonable ground of suspicion that it may
lent in foreign currency where such series of transactions involve the proceeds of crime; or
take place within one calendar month. (b) appears to be made in circumstances of unusual or unjusti-
l All suspicious transactions whether or not made in cash. fied complexity; or
SEBI has laid down the minimum requirements / disclosures to be (c) appears to have no economic rationale or bonafide purpose.
made in respect of clients. The intermediaries are required to specify Broad categories of reason for suspicion and examples of
additional disclosures to be made by clients to address concerns of suspicious transactions for an intermediary are indicated as under:
Money Laundering and suspicious transactions undertaken by clients, Identity of Client
according to their requirements.
- False identification documents
All intermediaries are advised to ensure that a proper policy
- Identification documents which could not be verified within
framework as per the Guidelines on anti-money laundering measures
reasonable time
is put into place within one month from the date of the circular. The - Non-face to face client
intermediaries are also reqired to designate an officer as Principal - Doubt over the real beneficiary of the account
Officer who would be responsible for ensuring compliance of the - Accounts opened with names very close to other established
provisions of the PMLA. business entities
Obligations Of Intermediaries Under Prevention Of Money Suspicious Background
Laundering Act, 2002.
- Suspicious background or links with known criminals
Section 12 of the Prevention of Money Laundering Act, 2002 lays
down following obligations on an intermediary: Multiple Accounts
(1) Every banking company, financial institution and intermediary - Large number of accounts having a common account holder,
introducer or authorized signatory with no rationale
- Unexplained transfers between multiple accounts with no
A. maintain a record of all transactions, the nature and value of which
may be prescribed, whether such transactions comprise of a sin-
gle transaction or a series of transactions integrally connected to Activity in Accounts
each other, and where such series of transactions take place - Unusual activity compared to past transactions
within a month; - Use of different accounts by client alternatively
B. furnish information of transactions referred to in clause (a) to the - Sudden activity in dormant accounts
Director within such time as may be prescribed;
- Activity inconsistent with what would be expected from
C. Verify and maintain the records of the identity of all its clients, in declared business
such a manner as may be prescribed.
- Account used for circular trading
Provided that where the principal officer of an Intermediary or
financial institution or intermediary, as the case may has reason to Nature of Transactions
believe that a single transaction or series of transactions integrally - Unusual or unjustified complexity
connected to each other have been valued below the prescribed limit - No economic rationale or bonafide purpose
so as to defeat the provisions of this section, such officer shall furnish - Source of funds are doubtful
1. Prepared by Sonia Baijal, Asstt. Director , The ICSI. - Appears to be case of insider trading

Student Company Secretary 5 February 2007

Academic Guidance
- Investment proceeds transferred to a third party between the client and trading member.
- Transactions reflect likely market manipulations Trading Members are required to formulate and implement the client
- Suspicious off market transactions identification program containing the requirements as laid down in Rule
Value of Transactions 9 and such other additional requirements that it considers appropriate.
The records of the identity of clients have to be maintained and
- Value just under the reporting threshold amount in an preserved for a period of ten years from the date of cessation of the
apparent attempt to avoid reporting transactions between the client and trading member.
- Large sums being transferred from overseas for making II SEBI (SELF REGULATORY ORGANISATIONS)
payments REGULATIONS, 2004
- Inconsistent with the clients apparent financial standing The Securities and Exchange Board of India (Self Regulatory
- Inconsistency in the payment pattern by client Organizations) Regulations, 2004 came into effect on 19th February,
2004. According to Regulation 2(1)(k) Self Regulatory Organization
- Block deal which is not at market price or prices appear to
means an organization of intermediaries which is representing a
be artificially inflated/deflated particular segment of the securities market and which is duly recognised
Suspicious Transaction Reports can be filed either in manual or by the Board under these regulations, but excludes a stock exchange.
electronic format. However, a reporting agency must submit all reports Recognition of Self Regulatory Organization
to FIU-IND in electronic format if it has the prescribed technical
Regulation 3 provides that any group or association of
capability to do so.
intermediaries, which is desirous of being recognized as a Self
Each registered intermediary should adopt written procedures to Regulatory Organization, may form a company under section 25 of
implement the anti money laundering provisions as envisaged under the Companies Act, 1956 and such company may make an application
the Anti Money Laundering Act, 2002. Such procedures should include to the SEBI for grant of certificate of recognition as a Self Regulatory
inter alia, the following three specific parameters which are related to Organization.
the overall Client Due Diligence Process: Every application made by such company must contain such
a. Policy for acceptance of clients particulars as may be specified and is to be accompanied by a copy of
b. Procedure for identifying the clients the governing norms of Self Regulatory Organization and also a copy
of the memorandum and articles of association relating in general to
c. Transaction monitoring and reporting especially Suspicious the constitution of the Self Regulatory Organization and in particular,
Transactions Reporting (STR) to
Client identification procedure a. Board of Directors of Self Regulatory Organization, its con-
The Know your Client (KYC) policy should clearly spell out the stitution and powers of management and the manner in which
client identification procedure to be carried out at different stages i.e. its business would be transacted;
while establishing the intermediary client relationship, while carrying b. the powers and duties of the office bearers of Self Regula-
out transactions for the client or when the intermediary has doubts tory Organization;
regarding the veracity or the adequacy of previously obtained client c. the admission into the Self Regulatory Organization of mem-
bers, agents, their qualifications for membership, and the
identification data. SEBI has prescribed the minimum requirements
exclusion, suspension, expulsion and readmission of mem-
relating to KYC for certain class of the registered intermediaries from
bers therefrom or there into;
time to time. Taking into account the basic principles enshrined in the The application is to be signed on behalf of the applicant under
KYC norms which have already been prescribed or which may be authority of its Board of Directors by its Chairman, Managing Director,
prescribed by SEBI from time to time, all registered intermediaries Chief Executive Officer or whole time director. The application is to be
should frame their own internal guidelines based on their experience made in Form A of the first schedule and is to be accompanied by a
in dealing with their clients and legal requirements as per the non-refundable application fee, as specified in Part A of the second
established practices. Further, the intermediary should also maintain schedule, to be paid in the manner specified in Part B thereof.
continuous familiarity and follow-up where it notices inconsistencies Eligibility criteria
in the information provided. The underlying principle should be to follow
Regulation 4 provides the following criteria to be fulfilled by an
the principles enshrined in the PML Act, 2002 as well as the SEBI Act, association seeking registration under these regulations:-
1992 so that the intermediary is aware of the clients on whose behalf
a. the applicant should have been granted license under sec-
it is dealing.
tion 25 of Companies Act, 1956;
Information to be maintained b. the memorandum of association, should specify admission
Trading Members are required to maintain and preserve the of members and discharging the functions of Self Regula-
following information in respect of transactions mentioned above. tory Organization as one of its main objects;
(i) the nature of the transactions; c. the applicant should have a minimum networth of one crore
(ii) the amount of the transaction and the currency in which it was d. the applicant is to have adequate infrastructure, to enable it
denominated; to discharge its functions as a Self Regulatory Organization
(iii) the date on which the transaction was conducted; and in accordance with the provisions of the Act and these regu-
(iv) the parties to the transaction. lations;
e. the directors have the professional competence, financial
Maintenance and Preservation of records soundness and general reputation of fairness and integrity
The Trading Members are required to take appropriate steps to to the satisfaction of the Board;
evolve an internal mechanism for proper maintenance and preservation f. neither the applicant, nor any director of the applicant is in-
of such records and information in a manner that allows easy and volved in any legal proceeding connected with the securities
quick retrieval of data as and when requested by the competent market, which may have an adverse impact on the interests
authorities. Further, the records have to be maintained and preserved of the investors;
for a period of ten years from the date of cessation of the transactions g. neither the applicant, nor any director has at any time in the

Student Company Secretary 6 February 2007

Academic Guidance
past been convicted of any offence involving moral turpitude issued by the Board from time to time;
or any economic offence; b. any information or particulars furnished to the Board by the
h. the applicant has, in its employment, persons having ad- applicant shall not be false or misleading in any material
equate professional and other relevant experience to the respect;
satisfaction of the Board; c. where any material information or particulars furnished to
i. the applicant, in all other respects, is a fit and proper person the Board by the applicant, in or in connection with the appli-
for the grant of a certificate; cation for recognition, has undergone change subsequent
j. grant of certificate to the applicant is in the interest of inves- to its furnishing, the applicant shall forthwith inform the fact
tors and the securities market. to the Board in writing;
Grant of recognition as a Self Regulatory Organization Renewal of certificate
If SEBI is satisfied under Regulation 5, after making such inquiry Regulation 9 provides that an application for renewal of Certificate
as may be necessary in this behalf and after obtaining such further of Recognition shall be made to the Board in Form A of the First
information, if any, as it may require, - Schedule. Such application shall be made not less than three months
(a) that the articles and governing norms of the applicant apply- before expiry of the period of validity of the certificate. The application
ing for recognition are in conformity with such conditions as shall be accompanied by a renewal fee as specified in the second
may be specified by the Board; schedule and, as far as may be, shall be dealt with in the same manner
(b) that the applicant is willing to comply with any other condi- as if it were an application for the grant of a fresh certificate under
tions which the Board may impose for the purpose of carry- regulation 3.
ing out the objects of these Regulations; and, SEBI, if satisfied may renew the certificate in Form B2 of the First
(c) that it would be in the interest of the trade and also in the Schedule subject to such terms and conditions as it may deem fit and
public interest to grant recognition to the applicant as a Self appropriate.
Regulatory Organization;
the Board may grant certificate of recognition to the applicant as a Procedure where certificate is not granted
Self Regulatory Organization in Form B1 of the First Schedule subject Regulation 10 provides that if, after considering an application made
to such terms and conditions as the Board may deem fit and under regulation 3 or regulation 9, as the case may be, the Board is of
appropriate. the opinion that a certificate should not be granted or renewed, it may,
Regulation 5(2) empowers the Board to specify any conditions for after giving the applicant a reasonable opportunity of being heard,
the grant of recognition to the applicant as a Self Regulatory reject the application within a period of thirty days of receipt of such
Organization. Such conditions may relate to- application complete in all respects or within thirty days of receipt of
further information or clarification sought under regulation 7. The fact
i. the qualification for membership of the Self Regulatory Or- of the rejection of the application shall be communicated to the applicant
ganization; forthwith stating the grounds for such rejection.
ii. the representation of the Board in the Board of Directors of
the Self Regulatory Organization by such number of direc- Effect of refusal to grant certificate
tors not exceeding four as the Board may nominate in this Regulation 11 provides that an applicant whose application for the
behalf; and grant of a certificate has been rejected shall not undertake any activity
iii. the maintenance of accounts of members and their audit by as Self Regulatory Organization. Similarly, a Self Regulatory
chartered accountants whenever such audit is required by Organization whose application for the renewal of certificate has been
the Board. rejected by the Board shall on and from the date of the receipt of the
The Self Regulatory Organization cannot amend its articles without communication of rejection from the Board cease to carry on any activity
the prior written approval of the Board. as Self Regulatory Organization.
Application to conform to the requirements If SEBI is satisfied that it is in the interests of investors to do so, it
Regulation 6 provides that any application for a certificate, which may permit the Self Regulatory Organization to complete the functions
is not complete in all respects or does not conform to the requirements or obligations already initiated or undertaken by it during the pendency
of these regulations and particularly regulations 3, 4 and 5 or of the application or during the period of validity of the certificate. In
instructions specified in Form A shall be rejected by the Board. However, order to protect the interests of investors, the Board may issue
before rejecting any such application, the Board shall give an directions with regard to the transfer of records, documents or reports
opportunity to the applicant to remove such objections as may be relating to the functions of the Self Regulatory Organization, whose
indicated by the Board, within 30 days of the date of receipt of relevant application for the grant or renewal of a certificate has been rejected.
communication, from the Board. On sufficient cause being shown, Further, the Board may, appoint any person to take charge of the
the Board may extend the time for removal of objections by such further records, documents or reports relating to the organization and also
time, not exceeding 30 days as it may consider fit, to enable the determine the terms and conditions of such appointment.
applicant to remove such objections. Composition of Board of Directors
Furnishing of information, clarification and personal Regulation 12 of Chapter III of the Regulations provides that the
representation Articles of Association of a Self Regulatory Organization shall provide
SEBI may under Regulation 7 require the applicant to furnish such for the following: -
further information or clarification as it may consider necessary for the (a) There shall be a Board of Directors of the Self Regulatory Or-
purpose of processing of the application. It may also require the applicant ganization and majority of directors shall be independent direc-
to appear before it through an authorized representative for personal tors.
representation in connection with the grant of a certificate of recognition.
(b) The independent directors shall not be required to hold any quali-
Conditions of certificate and validity period fication shares.
As provided under Regulation 8 the certificate granted under (c) The Board of Directors shall consist of nine directors out of which
regulation 5 is valid for a period of five years, and subject to the following five directors shall be nominated by the Board and the remaining
conditions, namely: - four shall be elected by the members of the Self Regulatory Or-
a. the applicant shall comply with the provisions of the Act, ganization.
applicable regulations and guidelines, directions or circulars (d) The General Superintendence, direction and management of the

Student Company Secretary 7 February 2007

Academic Guidance
affairs of the Self Regulatory Organization shall vest in its Board subject to the previous approval of the Board, make governing norms
of Directors, which may exercise all powers and do all acts and and articles consistent with the provisions of the Act and these
things which may be exercised or done by the Self Regulatory regulations. In particular, and without prejudice to the generality of the
Organization. foregoing power, the governing norms or articles may provide for:-
(e) There shall be a Chairman, who shall be an independent profes- (i) eligibility criteria for admission and removal of members from
sional, appointed by Board of Directors, with the prior approval of Self Regulatory Organization;
the Board. (ii) manner and the periodicity of furnishing information to the
(f) The Chairman shall be responsible for day-to-day administration Board and to its members;
of Self Regulatory Organization and implementing the decisions (iii) arbitration mechanism for resolving disputes between mem-
of Board of Directors. bers and / or between members and their constituents;
(iv) procedure for proceeding against the member committing
(g) The Board of Directors may establish committees including dis- breach of the governing norms or articles including provisions
ciplinary committee, screening committee, arbitration committee for suspension or expulsion of members from the Self
or remuneration committee in order to carry out the purposes of Regulatory Organization;
these regulations. It has been provided that the committees con-
stituted under this regulation may consist wholly of other persons (v) internal control standards including procedure for inspection,
or partly of directors and partly of other persons. The majority of auditing, reviewing, monitoring and surveillance of its
members of each such committee shall be independent. members by Self Regulatory Organization;
(h) The office bearers of Board of Directors shall relinquish their of- (vi) code of conduct specifying standards for its members in the
fice, when the Board passes an order under clause (c) of sub- conduct of business;
section (4) of section 11 of the Act. (vii) procedure for conduct of election of the office bearers and
(i) The Board of Directors of the Self Regulatory Organization shall members of the committees;
be reconstituted as and when required by the Board. (viii) obligation of members to supply such information or
Membership of Self Regulatory Organization explanation and to produce such documents relating to the
business as Board of Directors may require;
As per Regulation 13 any application for registration or renewal of
registration as an intermediary with the Board under the respective (ix) manner of disciplinary action against its members by Self
regulations applicable to such intermediaries, shall in case of any Regulatory Organization;
applicant who is a member of a Self Regulatory Organization or who (x) contents and format of the annual report;
ought to be a member of a Self Regulatory Organization, be made (xi) procedure for conduct of the meetings, quorum etc. of Board
only through the Self Regulatory Organization of which he is a member, of Directors;
in the specified manner. The application is to be forwarded by the Self
Regulatory Organization to the Board along with its recommendation (xii) manner of maintaining accounts or records of the Self
for grant or refusal of certificate of registration not later than 30 days Regulatory Organization; and,
from the date of its receipt. The Self Regulatory Organization is also (xiii) reporting requirements to the Board on monthly basis about
required to give the reasons for its recommendation either for granting various aspects of its functioning including policy initiatives,
certificate of recognition or for refusal of certificate of registration by progress in certification, number of members admitted and
the Board. disciplinary action taken against members, if any.
Functions and Obligations of Self Regulatory The governing norms or articles must provide that the contravention
Organization of any of the governing norms shall render the member of Self
As per Regulation 14, a Self Regulatory Organization shall always Regulatory Organization concerned liable to one or more of the
abide by the directions of the Board. It shall be responsible for investor following punishments, namely:-
protection and education of investors or its members and shall ensure (i) forfeiture of shares;
observance of Securities Laws by its members. It is required to specify (ii) expulsion from membership;
standard of conduct for its members and also shall be responsible for (iii) suspension from membership for a specified period;
the implementation of the same by its members. The SRO is required (iv) any other penalty of a like nature not involving the payment
to conduct inspection and audit of its members, on regular basis, of money.
through independent auditors. The Annual Report of the SRO is to be Where the Board considers it expedient so to do, it may, by order
submitted to the Board. The SRO shall treat all its members and the in writing, direct a Self Regulatory Organization to make any governing
applications for membership in a fair and transparent manner. The norms or to amend or revoke any of them within such period as it may
SRO may collect admission and membership fees from its members specify in this behalf. If a Self Regulatory Organization fails or neglects
for carrying out the purposes of these regulations. The Board is to be to comply with such order within the specified period, the Board may
promptly informed of violations of the provisions of the Act, the rules, make, amend or revoke the governing norms either in the form specified
the regulations, the directions, the circulars or the guidelines by any of in the order or with such modifications as the Board may think fit.
its members. The SRO is required to conduct screening and certification SEBIs right to inspect
tests for its members, agents and such other persons as it may
determine. The SRO is to conduct training programmes for its members Regulation 16 of Chapter IV provides that where it appears to the
or agents and also conduct awareness programmes for securities Board so to do, it may appoint one or more persons as inspecting
market investors. The SRO is required to make endeavors for authority to undertake inspection of the books of accounts, other records
introduction of best business practices amongst its members. It must and documents of the Self Regulatory Organization for any of the
act in utmost good faith and must avoid conflict of interest in the conduct following purposes:
of its functions. The SRO must comply with the norms of corporate (a) to ensure that the provisions of the Act, the regulations, the
governance as applicable to listed companies. It may discharge such directions and the circulars issued by the Board are being
other functions and obligations as may be specified by the Board, complied with;
from time to time. (b) to inquire into the complaints received from members, in-
Governing norms of Self Regulatory Organization vestors, or any other person on any matter having a bearing
on the activities of the Self Regulatory Organization; or,
Regulation 15 provides that a Self Regulatory Organization may, (c) to inquire suo motu, in the interest of securities business or

Student Company Secretary 8 February 2007

Academic Guidance
investors interest, into the affairs of the Self Regulatory Or- Regulatory Organization as the Board may require; or
ganization. (b) appoint one or more persons to make an inquiry in the pre-
Procedure for inspection scribed manner in relation to the affairs of a Self Regulatory
Regulation 17 provides that before undertaking any inspection under Organization or the affairs of any members of the Self Regu-
regulation 16, the Board shall give a reasonable notice to the Self latory Organization in relation to the Self Regulatory Organi-
Regulatory Organization for that purpose. Where the Board is satisfied zation and submit a report of the result of such inquiry to the
that in the interest of the investors or in public interest, no such notice Board within such time as may be specified in the order or,
should be given, it may by an order in writing, direct that the inspection in the case of inquiry in relation to the affairs of any of the
of the affairs of the Self Regulatory Organization be taken up without members of a Self Regulatory Organization direct Board of
such notice. The inspecting authority shall undertake the inspection Directors to make the inquiry and submit its report to the
and the Self Regulatory Organization against whom an inspection is Board.
being carried out and shall be bound to discharge its obligations as Where an inquiry in relation to the affairs of a Self Regulatory
provided under regulation 18. Organization or the affairs of any of its members in relation to the
Obligations of Self Regulatory Organization on inspection SRO has been undertaken the Chairman, every director, manager,
by the Board secretary, or other officer, every member of the Self Regulatory
Organization ( if the member of the Self Regulatory Organization is a
As provided under Regulation 18, it shall be the duty of the firm, every partner, manager, secretary or other officer of the firm)
Chairman, every Director, officer and employee of the Self Regulatory and, every other person or body of persons who has had dealings in
Organization, who is being inspected to produce to the inspecting the course of business with any of the members or officers of the SRO
authority or to any person authorized by him, such books, accounts whether directly or indirectly; shall be bound to produce before the
and other documents in their custody or control and furnish to the authority making the inquiry all such books of account, and other
Board the statements and information relating to the activities of Self documents in his custody or power relating to or having a bearing on
Regulatory Organization in securities market within such time as the the subject matter of such inquiry and also furnish to the authority
Board may require. The SRO shall allow the inspecting authority or such statement or information as he may require within such time as
any person authorized by him to have reasonable access to the may be specified by him.
premises occupied by the SRO or by any other person on its behalf
and also extend reasonable facility for examining any books, records, Obligation of Board of Directors to take disciplinary
documents and computer data in the possession of the SRO or any action against a member if so directed by the Board
other person and also provide copies of documents or other materials Regulation 22 of Chapter V provides that after receiving the report
which, in the opinion of the inspecting authority are relevant. of an enquiry made under regulation 21, the Board may take such
The inspecting authority in the course of inspection shall be entitled action as it deems proper and, in particular, may direct Board of
to examine or record statements of the Chairman, Director, any member Directors of the Self Regulatory Organization to take such disciplinary
and employee of the Self Regulatory Organization. It is the duty of the action against the delinquent member, including expulsion, suspension
Chairman, every Director, officer and employee of the SRO to give to or any other penalty of a like nature not involving the levy of monetary
the inspecting authority all assistance in connection with the inspection, penalty, as may be specified by it and thereupon, notwithstanding
which the SRO may reasonably be expected to give. anything to the contrary contained in the articles or governing norms
of the Self Regulatory Organization concerned, the Board of Directors
Submission of report to the Board of the Self Regulatory Organization shall give effect to the directions
Regulation 19 provides for the submission of the report to the Board. of the Board and shall not in any manner commute, revoke or modify
The inspecting authority shall, as soon as possible, submit an the action taken in pursuance of such directions, without the prior
inspection report to the Board. written approval of the Board.
Appointment of auditor The Board may either on its own motion or on representation of
Under Regulation 20 the Board may appoint a qualified auditor to the member concerned, modify or withdraw any of its directions issued
inspect the books of account or the affairs of the Self Regulatory under sub-regulation (1), if it is satisfied that there are sufficient grounds
Organization. The auditor so appointed shall have the same powers for doing so.
of the inspecting authority as mentioned in regulation 16 and the Withdrawal of recognition
obligations of Self Regulatory Organization mentioned in regulation Regulation 23 provides that if the Board is of the opinion that the
18 shall be applicable to an inspection under this regulation. The Board
recognition granted to a Self Regulatory Organization under the
is entitled to recover the expenses of such audit or inspection as may
provisions of these Regulations should, in the interest of the trade or
be incurred by it, including fees paid to the auditors, from the concerned
in the public interest, be withdrawn, it may serve a written notice in
Self Regulatory Organization.
Form C on Board of Directors of the Self Regulatory Organization
Periodical returns or direct inquiries calling upon it to show cause as to why the recognition should not be
Regulation 21 provides that every Self Regulatory Organization is withdrawn for the reasons stated in the notice. Where such notice is
required to furnish to the Board such periodical returns relating to its issued, the Board may, after giving an opportunity to Board of Directors
affairs as may be specified. The SRO and every member thereof shall of the Self Regulatory Organization to be heard in the matter, withdraw,
maintain and preserve for such periods such books of account and by passing an order, the recognition granted to the Self Regulatory
other documents as the Board after consultation with Board of Directors Organization and thereupon the provisions of regulation 11 would apply
of SRO concerned, may specify in the interests of the trade or in the as if the application of the Self Regulatory Organization for renewal of
public interest and such books of account and other documents shall recognition has been rejected under regulation 10.
be subject to inspection at all reasonable times by the Board. If the The Board shall promptly communicate such order to the concerned
Board is satisfied that it is in the interests of the trade or in the public Self Regulatory Organization. On receipt of the order, the Self
interest so to do, it may, by order, in writing, - Regulatory Organization shall cease to carry on any activity as a Self
Regulatory Organization and shall comply with such directions as may
(a) call upon Board of Directors of a Self Regulatory Organiza- be issued by the Board.
tion or any member thereof to furnish in writing such infor-
mation or explanation relating to the affairs of the Self Regu- Action in case of violation
latory Organization or of the member in relation to the Self It has been provided under Regulation 24 that if any Self Regulatory

Student Company Secretary 9 February 2007

Academic Guidance
Organization, any office bearer or member thereof violates any including primary legislation, rules and standards issued by legislators
provisions of the Act or these regulations, it may be liable for and supervisors, market conventions, codes of practice promoted by
(a) action under Chapter VIA of the SEBI Act; industry associations, and internal codes of conduct applicable to the
(b) action under subsection (3) of section 12 of the SEBI Act; staff members of the bank. For the reasons mentioned above, these
(c) action under subsection (4) of section 11 and section 11B of are likely to go beyond what is legally binding and embrace broader
the SEBI Act; standards of integrity and ethical conduct.
(d) action under section 24 of the SEBI Act; It shall be the responsibility of banks Compliance Officer in the
(e) such other action permissible under the Act which may be bank to assist the top management in managing effectively the
deemed appropriate in the facts and circumstances of the compliance risks faced by the bank.
case. Compliance Risk
FINAL COURSE The Basel Committee on Compliance Function defines Compliance
risk as the risk of legal or regulatory sanctions, material financial loss,
BANKING AND INSURANCE LAW AND or loss to reputation a bank may suffer as a result of its failure to
comply with laws, regulations, rules, related self-regulatory organization
PRACTICE standards, and codes of conduct applicable to its banking activities
(together, compliance laws, rules and standards).
The compliance area is critically important in identifying, evaluating,
FUNCTION IN BANKS2 and addressing legal and reputational risks. Given the significance of
A system of Compliance Officer in banks was introduced by these risks, a strong Group/enterprise-wide compliance program is a
Reserve Bank of India in August 1992, based on the recommendations necessity for banks. A group/enterprise-wide compliance program helps
of the Committee on Frauds and Malpractices in Banks (Ghosh the bank to look at and across business lines and activities of the
Committee). Further guidelines in this regard, and more specifically organization as a whole and to consider how activities in one area of
on the role of the Compliance Officers were issued in March 1995. In the firm may affect the legal and reputational risks of other business
1997, a review of the system of Compliance offices was undertaken lines and the entire group/ enterprise.
wherein, in supersession of earlier guidelines, banks were advised
that the General Manager in charge of Audit and Inspection should be A group/enterprise-wide compliance program could help
designated as the Compliance Officer reporting directly to the CMD management and the board in understanding where the legal and
and submit a quarterly certificate on compliance (subsequently reputational risks in the organization are concentrated, provide
withdrawn in 2000) with RBI/ GOI instructions. comparisons of the level and changing nature of risks, and identify
those control processes that most need enhancement. The compliance
The compliance function in banks however, has not received the function must therefore ensure that controls and procedures capture
required attention by banks, as a number of instances of non- the appropriate information to allow senior management and the board
compliance and lack of proper interpretation of regulatory guidelines to better perform their risk management functions on a group-wide
are being reported in successive RBI inspection reports. Further, in basis.
the absence of a comprehensive compliance structure, policy and
manual for addressing compliance risk in most of the banks, Responsibility of the Board and Senior Management
compliance processes remain weak and the role of the Compliance Compliance starts at the top. It will be most effective in a corporate
Officer has not been an effective instrument for which it was created. culture that emphasizes standards of honesty and integrity and in which
In April 2005, the Basel Committee on Banking Supervision (BCBS) the board of directors and senior management lead by example.
had issued a paper on Compliance and the Compliance function in Responsibility of the Board of Directors
banks, prescribing certain principles aimed at strengthening The Board would be responsible for ensuring that an appropriate
compliance structure in banks. Comprehensive guidelines on
compliance policy is in place in the bank to manage compliance risk
compliance and the compliance function have been formulated by the
and also oversee its implementation. It has to ensure that compliance
Reserve Bank of India. The RBI vide its Circular No. DBS.PP.BC1/11/
issues are resolved effectively and expeditiously by senior management
01.005/2006-07 dated November 16, 2006 has made its mandatory
for banks to implement these guidelines. with the assistance of compliance staff. If necessary, the Board may
delegate these tasks either to the Audit Committee of the Board (ACB)
The RBI Guidelines on Compliance and Compliance function in or a specific Board level Committee constituted for the purpose.
Banks provide as under:
The Board, ACB or the Board Committee, as the case may be,
should review compliance function on a quarterly basis. In order to
Each bank, will formulate a Compliance Function for their bank. ensure that the activities of the compliance function are subject to
The Compliance Function is for ensuring strict observance of all independent review, the compliance function and the audit function of
statutory provisions contained in various legislations such as Banking the bank should necessarily be kept separate.
Regulation Act, Reserve Bank of India Act, Foreign Exchange
Management Act, Prevention of Money Laundering Act etc. as well as Responsibility of Senior Management
to ensure observance of other regulatory guidelines issued from time The banks senior management would be responsible for
to time; standards and codes prescribed by IBA, FEDAI, FIMMDA etc. establishing a written compliance policy that would contain the basic
and also each banks internal policies and fair practices code. principles to be followed by the management and staff, and would
Compliance laws, rules and standards generally cover matters such explain the main process by which compliance risk would be identified
as observing proper standards of market conduct, managing conflicts and managed through all levels of the organization.
of interest, treating customers fairly, and ensuring the suitability of The senior management would ensure that appropriate remedial
customer advice. They typically include specific areas such as the
or disciplinary action is taken if breaches are identified.
prevention of money laundering and terrorist financing, and may extend
to tax laws that are relevant to the structuring of banking products or Senior management should, with the assistance of the compliance
customer advice. function:
Compliance laws, rules and standards have various sources, l at least once a year, identify and assess the main compli-
ance risk issues facing the bank and formulate the plans to
2. Compiled by Saurabh Jain, Education Officer, The ICSI. manage them.
Student Company Secretary 10 February 2007
Academic Guidance
l at least once a year send a report to the board of directors or case of foreign banks. The Board, Audit Committee of the Board or
a committee of the board on the banks management of its any other Board Committee as the case may be, should be kept
compliance risk, in such a manner as to assist board mem- informed of any change in the Chief Compliance Officer as also the
bers to make an informed judgment on whether the bank is reason for the change in the incumbent. The Reserve Bank of India
managing its compliance risk effectively; and shall also similarly be kept informed of the name of the Chief
l report promptly to the board of directors or a committee of Compliance Officer as also any change thereof, as and when it takes
the board on any material compliance failure (e.g. failure place.
that may attract a significant risk of legal or regulatory sanc- In the case of larger banks, compliance staff may be located within
tions, material financial loss, or loss to reputation). operating business lines. Internationally active banks (including foreign
The Compliance Policy banks having a presence in India) may also have group and local
A robust Compliance system in a bank should include a well compliance officers reporting to their own Regional / Global Head while
documented Compliance Policy, outlining the compliance philosophy closely working with the local CEO on regulatory / compliance issues.
of the bank, role and set up of the Compliance Department, composition The Compliance Department should be provided with adequate
of its staff and their specific responsibilities. The policy should be staff. Further, each Department in the Head Office, controlling offices
reviewed annually by the Board. and branches (and / or Strategic Business Units (SBUs) in the case of
Broadly, the policy should include the following aspects: certain banks as considered appropriate depending on their business
delivery model) should have a Compliance Officer, who would report
l Setting up of an independent Compliance Department at the to the Chief Compliance Officer.
Head Office with a senior executive heading it with adequate
support staff and specifying its role and responsibilities. The staff in the Compliance Department at the Head Office as also
l Compliance structure in controlling offices and branches Compliance Officers at controlling offices and branches / SBUs should
specifying the role and responsibility of each functionary in primarily focus on compliance functions. However, in small sized banks
the Compliance units. with limited branch network, the compliance staff could be assigned
l Measures to ensure independence of the compliance func- some other duties while ensuring that there is no conflict of interest.
tion - It would be necessary that the remuneration of the Under no circumstances, the compliance staff should be assigned
compliance functionaries is not related to the business line audit/inspection duty as it gives rise to serious conflict of interest in
for which they exercise compliance responsibilities though it view of the fact that all products and processes are expected to be
could generally be related to the financial performance of cleared by the Compliance Department and its audit needs to be carried
the bank as a whole. out independently by separate set of staff.
l Focus of the compliance on regulatory compliance, statu- Some banks may wish to organize their compliance function within
tory compliance, compliance with fair practice codes and their operational risk function, as there is a close relationship between
other codes prescribed / suggested by self-regulatory or- compliance risk and certain aspects of operational risk. Others may
ganizations, government policies, banks internal policies and prefer to have separate compliance and operational risk functions,
prevention of money laundering and funding of illegal activi- but establish mechanisms requiring close cooperation between the
ties. two functions on compliance matters.
l Monitoring compliance testing procedure. Apart from the basic qualifications, the Compliance staff should
l Right of the compliance function to have access to informa- preferably have a fair knowledge of law, accountancy and information
tion necessary to carry out its responsibilities and conduct technology and also adequate practical experience in various business
investigations of possible breaches of compliance policy. lines and audit/inspection functions to enable them to carry out their
l Relationship between Chief Compliance Officer and head of duties effectively. In order to keep the compliance staff up-to-date with
other functional departments. developments in the areas of banking laws, rules and standards, regular
l Mechanism for dissemination of information on regulatory and systematic education and training are required.
matters among operational staff and periodic updating of
They should therefore be adequately trained in new products and
operational manuals.
services introduced in the banking industry as well as in the areas of
l Approval of all new processes and products by the Compli-
corporate governance, risk management, supervisory practices etc.
ance Department prior to their introduction.
l Right of the compliance function to freely disclose its find- In some banks, the entire compliance responsibilities may not be
ings and views to senior management, Board / ACB or Board carried out by the compliance department. Compliance function staff
Committee. who reside in operating business units or in local subsidiaries may
The Compliance structure have a reporting line to operating business unit management or local
management. This is not objectionable, provided such staff also have
Depending on its branch network, size and complexity of the a reporting line through to the head of compliance as regards their
business operations, sophistication of products and services offered compliance responsibilities. In cases where compliance function staff
etc. every bank should decide on the organizational structure and reside in independent support units (e.g. legal, financial control, risk
composition of its Compliance unit. management), a separate reporting line from staff in these units to the
A Compliance Department having formal status should be set up head of compliance may not be necessary. However, these units should
at the Head Office of the bank, (in the case of foreign bank branches co-operate closely with the head of compliance.
it should be at the banks Principal Office in India). The compliance In all such cases, there should invariably be an appropriate
department should have an executive or senior staff member of the mechanism for coordination among these departments to enable the
cadre not less than in the rank of DGM or equivalent designated as Chief Compliance Officer to perform the assigned responsibilities
Group Compliance Officer or Head of Compliance with overall effectively.
responsibility for coordinating the identification and management of The Chief Compliance Officer should be the nodal point of contact
the banks compliance risk and supervising the activities of other between the bank and the regulator. Regardless of how the compliance
compliance function staff. function is organized within a bank, it should be independent and
The Compliance officer, once appointed cannot be removed by sufficiently resourced, its responsibilities should be clearly specified
and its activities should be subject to periodic and independent review.
the Chief Executive Officer of the bank, except with the specific approval
of the Board of Directors of the bank / Head Office of the bank in the The compliance function should also attend to the compliance of

Student Company Secretary 11 February 2007

Academic Guidance
directions from other regulators (IRDA, SEBI etc.) in those cases where Compliance Department shall monitor timely submission of regulatory
the activities of the bank are not limited to the banking sector. For returns by the controlling offices through appropriate mechanism, such
example, a bank which is acting as a corporate agent for distribution as a Monthly Returns Calendar, which may indicate the returns/reports
of other companies insurance products may receive direction from to be submitted by each branch/controlling office and their dates of
IRDA, which should be a part of the compliance function. Further, submission.
discomfort conveyed to the bank on any issue by other regulators, Compliance function should use the internal audit and concurrent
should be brought to the notice of the Reserve Bank of India. audit as a feedback mechanism. The Chief Compliance Officer should
Compliance process and procedures be an invitee to the meetings of the ACB. All audit reports should be
The Compliance Department at the Head Office should play the marked to Chief Compliance Officer and similarly, all reviews by
central role in the area of identifying the level of compliance risk in compliance department should be marked to internal audit department.
each business line, products and processes and issue instructions to The compliance function should monitor and test compliance by
operational functionaries. It should circulate the instances of performing sufficient and representative compliance testing and the
compliance failures among staff along with preventive instructions at results of such compliance testing should be reported to the senior
least once a year. Inspection/audit findings should serve as a feedback management.
mechanism for the Compliance Department. It should also consider ways to measure compliance risk (e.g. by
Broadly the Compliance process should involve the following using performance indicators) and use such measurements to enhance
actions: The Compliance Department should be the focal point for compliance risk assessment.
receipt and dissemination of all regulatory and internal guidelines/ Compliance staff should be empowered to conduct compliance
instructions among all operational departments. It should ensure that reviews/investigations, whenever required. The authority to use external
(a) appropriate instructions get promptly issued within the organiza- experts for the purpose of investigation, if required, should be left to
tion, the discretion of the Chief Compliance Officer.
(b) the instructions are actually received at each office, and The compliance function should be free to report to senior
(c) the instructions are implemented. management on any irregularities. Although its normal reporting line
should be to senior management, the compliance function should also
Banks may consider software-based solutions, provided by reputed have the right of direct access to the board of directors or to a committee
vendors, which make available all the regulatory instructions and also of the board, bypassing normal reporting lines. Further, it may be useful
provide regular updates. for the board or a committee of the board to meet with the head of
The Compliance risks in all new products and processes should compliance at least annually, as this will help the board or board
be thoroughly analyzed and appropriate risk mitigants by way of committee to assess the extent to which the bank is managing its
necessary checks and balances should be put in place before compliance risk effectively. It should have a right to direct access to
launching. The Chief Compliance Officer must be a signatory to all the the board of directors or a committee of the board.
existing and new products and the policy / procedure formulation for An Annual Report on compliance failures/breaches should be
outsourcing contracts in the bank. He should be a member of the new compiled and placed before the Board/ACB/Board Committee and
product committee of the bank and all products should be approved circulated to all the functional heads. Non-compliance of any regulatory
by him. All new products should be subjected to intensive monitoring guidelines and administrative actions taken against the bank along
for the first six months of introduction to ensure that the indicative with corrective steps taken to avoid recurrence of the lapses should
parameters of compliance risk are adequately monitored. be disclosed in the annual report of the banks.
The Compliance Department should serve as a reference point for The code of conduct for employees should envisage working
the banks staff from operational departments for seeking clarifications/ towards earning the trust of the society by dealing with customers in a
interpretations of various regulatory and statutory guidelines. fair manner and conducting business operations consistent with rules
Banks should develop function-wise Compliance Manuals duly and regulations. Due weightage could be given to record of compliance
approved by the Chief Compliance Officer and provide these to the during performance appraisal of staff at various levels. Staff
staff associated with the respective functions. accountability should be examined for all compliance failures.
The Compliance Department should go through all audit/inspection The Compliance Programme
reports and rectification reports regularly to enable it to identify The responsibilities of the compliance function should be carried
compliance failures in the bank. The Compliance Department should, out under a compliance programme that sets out its planned activities.
at frequent intervals, interact with Legal Department, Operational risk The compliance programme should be risk-based and subject to
management Department, Taxation Department and Audit/Inspection oversight by the head of compliance to ensure appropriate coverage
Department of the bank to take stock of the latest developments. across businesses and co-ordination among risk management
Compliance officers should have access to all information they require functions.
and have the right to conduct investigation and report the findings to
The compliance function may have specific statutory responsibilities
the Chief Compliance Officer. The Chief Compliance Officer shall
(e.g. fulfilling the role of anti-money laundering officer). Periodical
necessarily be a participant in the quarterly informal discussions held
reviews of the compliance systems and procedures within the bank
with RBI. In case, no quarterly meeting is held, he should meet the
and reporting to the Board are essential for maintaining the
Chief General Manager, DBS in charge of the concerned bank at
effectiveness of the compliance function. Banks should carry out an
Central Office of RBI, once in every quarter of the year, to discuss
annual compliance risk assessment in order to identify and assess
compliance issues.
major compliance risks faced by them and prepare a plan to manage
The compliance functionary should be looked at as a friend, the risks. The Annual review should broadly cover the following aspects.
philosopher and guide by the business units. There should be close
l Compliance failures, if any during the preceding year and
co-ordination and partnership between Compliance and Business
consequential losses and regulatory action as also steps
Operations functions. The interaction may be formalized by making
taken to avoid recurrence of the same.
the Chief Compliance Officer a member of the various
l List of all major regulatory guidelines issued during the pre-
interdepartmental committees in the bank. ceding year and steps taken by the bank to ensure compli-
Banks with fully operational core banking solutions should centralize ance.
their regulatory reporting at the Compliance Department. In other cases, l Independence of compliance function.

Student Company Secretary 12 February 2007

Academic Guidance
l Scope of compliance procedures and processes. submitted on the basis that books of accounts properly maintained by
l System of internal control to minimize compliance risk. the assessee were approved by assessing officer and not rejected by
l Compliance with fair practices codes and adherence to stand- him.
ards set by self regulatory bodies and accounting standards. Issues:
l Progress in rectification of significant deficiencies pointed
out in the internal audit, statutory audit and RBI inspection Whether the report of the departmental valuer was binding on the
reports and position of implementation of recommendations assessing officer irrespective of the fact that books of accounts for
made therein. cost of construction were maintained by the assessee? Is it right to
l Strategy for the next year including restructuring of compli- rely on valuation report in spite of the fact that no positive contrary
ance department, if necessary, posting/transfer/training of evidences were brought in by the assessing officer for rejecting the
staff. books of account of the assessee maintained for the purpose of cost
Apart from the exhaustive annual review, a monthly report on the of construction?
position of compliance risk may be put up to the senior management/ Decision:
CEO by the Chief Compliance Officer. A brief report on the compliance The valuation report was called for before reopening of the
position may also be placed before the Board/ACB/Board Committee, assessment and on perusal of the same, proceedings u/s 147 initiated.
as the case may be on a quarterly basis. The reopening was within the powers of the assessment officer since
Instances of all material compliance failures which may attract a he had a reason to believe from the valuation report that income
significant risk of legal or regulatory sanctions, financial loss or loss of chargeable to tax has escaped assessment u/s 69 of the Income- tax
reputation should be reported to the Board/ACB/Board Committee Act, 1961.
promptly. It was found that the cost of construction as assessed by the
The activities of compliance function should be subject to annual Valuation Officer was reasonable and no error or mistake could be
review by the internal audit. Compliance risk shall be included in the pointed out by the assessee during the course of hearing. The matter
risk assessment methodology of the internal audit function and the is purely a question of fact and not of law.
audit programme shall cover the adequacy and effectiveness of the It was held that the function of a valuer of a property is a technical
banks compliance function including testing of controls commensurate function requiring expert investigation for the purpose of estimating
with the perceived level of risk. the cost of construction. A valuation report is only an opinion of the
Guidance and education valuer and cannot form a ground for reason to believe for initiation of
The compliance function should advise and assist the senior a proceeding u/s 147 of the Income-tax Act, 1961.
management on compliance laws, rules and standards, including [2006] 287 ITR 341 (AAR) [Before the Authority for Advance
keeping them informed on developments by establishing written Rulings], (Income- Tax), Angel Garment Ltd., In re, October 30,
guidance to staff on the appropriate implementation of compliance 2006
laws, rules and standards through policies and procedures and other Facts:
documents such as compliance manuals, internal codes of conduct
and practice guidelines. Angel Garment Ltd., Hong Kong, a non resident company, having
its head office at Hong Kong, is proposing to set up a liaison office in
Cross Border issues India. The liaison office will perform following activities:
Banks may choose to carry on business in various jurisdictions for 1) Collecting information and samples of various garments and tex-
a variety of legitimate reasons. In such cases, it should be ensured tiles from various manufacturers, traders and exporters.
that they comply with applicable laws and regulations in all such
jurisdictions and that the organization and structure of the compliance 2) Passing on information with regard to various garments and tex-
function and its responsibilities are consistent with local legal and tile products available in India to the company at Hong Kong
regulatory requirements. It is for local businesses to ensure that 3) Co-ordinate and act as the channel of communication between
compliance responsibilities specific to each jurisdiction are carried out the Company and the Indian exporters
by individuals with the appropriate local knowledge and expertise, with 4) Follow up with the Indian exporters for timely export of goods
oversight from the head of compliance in co-operation with the banks ordered by the applicant
other risk management functions.
The entire expenses of the proposed liaison office were to be met
through remittances from the head office. On these facts the company
applied to Authority for Advance ruling on the following issue.
3 Whether the Angel Garment Company Ltd. could be said to have
[2006] 287 ITR 372 (Guwahati), Bishnu Talkies vs. Commissioner received income taxable in India as per provisions of Income tax Act,
of Income-Tax 20.09.06 1961?
Facts: Decision:
Bishnu Talkies, the assessee, started construction of a cinema The section 6(3) of the Income tax Act, 1961 reads as follows:
hall at Dhubri in financial year 1984-85 and almost completed the 6. For the purposes of this Act,-
same in the financial year 1987-88. The assessee filed the return for
the assessment year 1988-89 showing loss. (3) A company is said to be resident in India in any previous year,
The assessment was completed on a total income of Rs.
4,29,610/-. On appeal the assessment order was set aside and (i) it is an Indian company; or
valuation report was called for. On perusal of the report proceedings (ii) during that year, the control and management of its affairs is
u/s 147 initiated and notices u/s 148 were issued for the assessment situated wholly in India..
years 1985-86 to 1987-88. In response, loss returns of the assessment
years were filed and also objections against the valuation report were It is clear from the facts of the case and section 6(3) that as the

3. Prepared by Mamta Goel, Asstt. Education Officer, The ICSI. 3. Prepared by Mamta Goel, Assistant Education Officer, The ICSI.

Student Company Secretary 13 February 2007

Academic Guidance
company in not an Indian company and control and management is
situated outside India, the company is non- resident.
The clause (b) of Explanation 1 to Section 9(1)(i) of the Income In our endeavour to provide prompt and efficient services to the
student community, the overall status of all the registered students
Tax Act, 1961 reads as follows:
of the Institute has been uploaded to the website of the Institute
Income deemed to accrue or arise in India. viz. The information can be accessed as under:
Section 9. (1) The following incomes shall be deemed to accrue or
. Visit the Home Page
arise in India :-
(i) all income accruing or arising, whether directly or indirectly,
. Click on the tab 'Overall Status' under the
through or from any business connection in India, or through or from Group 'Students'
any property in India, or through or from any asset or source of income . Enter Full Registration Number
in India, or through the transfer of a capital asset situate in India.
. Press Tab Key
Explanation 1. For the purposes of this clause-..
. Wait for the name to appear on the adjacent
(b) in the case of a non-resident, no income shall be deemed to
accrue or arise in India to him through or from operations which are
confined to the purchase of goods in India for the purpose of export; . Click on the tab 'Go'
As the liaison office functions are confined to the purchase of goods The students may verify the particulars contained therein viz.
for export and the company is a non-resident, the company could not Student's Name, Father's Name, Date of Birth, Qualification, Paper-
be said to have earned any income taxable in India from the proposed wise Exemption (if any), Complete Postal Address with City, State
activities under the provisions of Income Tax Act, 1961. and Pin Code, Postal/Oral Coaching Status, etc. In case, they
come across any discrepancy and/or need any clarification/
UNIFORMITY IN SIGNATURES additional information/service, a written request may be sent to us
by E-Mail as per the details given below:
It has been observed that some of the enrollment
applications/ letters received from the students are either 1. Query regarding Registration Status/
unsigned or bear different signatures from time to time. Issue of Study Material, etc. for
(a) Intermediate Course
All the students are, therefore, advised to maintain uniformity
in their signatures on all the correspondence with the Institute (b) Foundation Course
including students identity card, enrolment application and (c) De-novo/Extension/Final Enrollment
attendance sheet provided in the examination hall at the time 2. Query regarding non-receipt of
of writing the examination. Registration Letter/ldentity Card/
Student Company Secretary Bulietin/
CS Foundation Course Bulletin, etc.
3. Query regarding paperwise exemption
Applicability of Latest Finance Act and other changes for 4. Query regarding Coaching
Company Secretaries June 2007 Examination. Completion Certificate/Suggested
DIRECT TAXES Answers and Response Sheet status
All students may note that for the June 2007 Examination session, 5. Query regarding issue of Admission
in respect of Direct Taxes, the applicable Assessment Year shall Certificate/Roll No. for Examinations, etc.
be 2007-08 (Previous year 2006-07).
Thus, they will have to study Finance Act, 2006 for June 2007
examination. Further, as per the syllabus, students are required CLARIFICATION REGARDING HINDI MEDIUM
to update themselves about all the Circulars, Clarifications, Queries are often being received by the Institute with regard
Notifications issued by CBDT & Central Government, which come to the option of medium for pursuing the Company Secretaryship
in to effect on or before 6 months prior to the date of the respective Course.
It is clarified that the students may opt for pursuing the course
Gift Tax Act has been excluded from the scope of examination in English/Hindi medium. However, the study material at present
from June 1999 session onwards unless otherwise informed.
is available in English medium only. In any case, the students
INDIRECT TAXES can enjoy the facility of submitting their response sheets to the
test papers under the Postal Tuition Scheme in English or Hindi
Students appearing in the Tax Laws (Indirect Tax portion to the medium. Similarly, they can opt to write the Institutes main
extent of topics covered in the syllabus) and Direct and Indirect
examination in English or Hindi Medium.
Taxation-Law and Practice (Indirect tax portion) paper of the
Intermediate and Final Courses respectively may take note of the As regards writing of examination, the option is to be exercised
following changes applicable for June 2007 Examination: while filling up the examination form as and when the students
1. All changes made by the Finance Act, 2006. intend to appear in the examination. This option is to be exercised
on group wise basis and not on individual paperwise basis.
2. All Circulars, Clarifications/Notifications issued by CBE&C/
Answering to test papers and writing examination partly in
Central Government which became effective six months prior
English and partly in Hindi medium is not permissible.
to the date of examination.

Student Company Secretary 14 February 2007

Legal World
repayment in terms of the deposits. The appellant having made
LEGAL WORLD payments to a few depositors was to settle similarly situated depositors.
Payments were directed to be made within three months, failing which
Compiled by T.K.A. Padmanabhan, FCS, Advocate, New Delhi. the respondents were entitled for interest at 10 percent, on delayed
LW(S) 10.02.2007
ASHOK ORGANICS INDUSTRIES LTD. v. DENA BANK & ORS LTD. [(2007 135 Comp Cas 57 (Del)] Vikramajit Sen J. [Decided on
[(2007) 135 Comp Cas 203 (Bom)], S.C.Dharmadhikari J. [Decided 08.9. 2006]
on 8.11. 2006] SICA-Section 22- During pendency of proceedings, civil court
Companies Act read with SICA- Sick Company before BIFR- granted injunction against alienating assets of the company-
Scheme of arrangement proposed by the sick company Whether Whether such injunctions fall under the purview of section 22 of
company court has jurisdiction to entertain the petition- Issue the SICA- Held, No.
referred to Larger Bench. Brief facts: Ex-parte interim orders were passed against the
Brief Facts : The Petitioner Company was a sick company and respondent company on February 19, 2004, and March 18, 2004,
was registered with the BIFR. The Petitioner Company proposed a restraining it from selling, alienating or in any manner creating third
scheme of arrangement before the High Court. The Company Judge party interest in respect of finished stock, stock of raw materials and
took a view that as long as the reference before the BIFR is pending, stock of packing materials. On an application the respondent relying
the company court has no jurisdiction. A coordinate bench of the High on section 22(1) of the Sick Industrial Companies (Special Provisions)
Court had decided the other way in an earlier case. Since there was Act, 1985, contended that the orders passed deserved to be recalled
difference between two coordinate benches of the same High Court, as no coercive recovery proceedings against the company shall lie or
the issue was referred to the Larger Bench. be proceeded with or without the permission of the BIFR.
Decision: Referred to Larger Bench. Decision: Application dismissed.
Reason: The Supreme Court has held in NGEF Ltd. v. Chandra Reason: I had expressed the opinion that the bar of section 22(1)
Developers P. Ltd. (2005) 127 Comp Cas 822 that the Sick Industrial of SICA would apply only to disputes reckoned or included in the
Companies (Special Provisions) Act, 1985, is a special statute and a sanctioned scheme. Jural experience is that companies most often
complete code by itself. It prevails over the Companies Act, 1956. It initiate proceedings under SICA in order to escape or procrastinate an
cannot be said that there is no inconsistency in the two enactments adjudication of their liabilities and debts. Where a claim of party had
and that they supplement each other. The provisions of the 1985 Act not been included in the scheme presented to BIFR, the preponderant
would prevail over the Companies Act. opinion is that courts can continue legal proceedings.
Judicial discipline requires the single judge not to ignore judgments There is yet another aspect to the present dispute. As has already
rendered by a co ordinate Bench and observations therein, which are been noted the SICA embargo is in respect of distress proceedings or
binding cannot be ignored unless they are per incuriam. Therefore, injunctions/orders in the genre of distress. The appointment of a
the question whether an industrial company which has made a receiver, despite pendency of proceedings before BIFR could justifiably
reference under section 15 of the Sick Industrial Companies (Special be viewed as distressful to the sick company, yet such appointments
Provisions) Act, 1985, can during the pendency of such reference, have been made. The injunctions passed in these proceedings on
apply to the court for sanctioning a scheme of arrangement or 19.2.2004, as well as on 18.3.2004, are preservatory rather than
compromise with its creditors and shareholders under sections 391 distressful. The Uppal Engineering (2005) 121 DLT 539; (2006) 132
and 394 of the Companies Act, 1956, and whether the court can take Comp Cas 4(Delhi) partake of the nature of distress in as much as a
cognizance of such an application during the pendency of the reference sum of Rs.133 crores had been taken out of the funds available to the
and pass necessary orders thereon as are permissible in law, has to sick company. In the present case the interim orders are calculated to
be decided by a larger bench. ensure that the assets of the sick company are not dissipated or frittered
LW(S) 09.02.2007 away. Such orders do not fall within the moratorium of section 22 of
Comp Cas 157 (Kar)], R.Guru Rajan & Jawed Rahim JJ. , [Decided
on 22-9- 2006.]
SICA- Reference pending before the BIFR-Depositors approached LW(S) 11.02.2007
the CLB for the repayment of deposits-CLB ordering for the same-
Whether correct- Held, Yes. BIRTHE FOSTER v. STATE & ANR [136 (2007) DLT 397), Badar
Durez Ahmed, J. [Decided on 1.12.2006]
Brief Facts: The appellant company received deposits from the
respondents and utilized them towards its working capital requirements. Negotiable Instruments Act, 1881- Section 141- Cheque dishonour-
It became sick and on a reference to the BIFR, an operating agency Persons responsible for the offence committed by a company-
was appointed to prepare a comprehensive report in the matter. In Whether agent of a company covered by section 141- Held, No.
the meantime on applications filed by the respondents under section Brief Facts: The petitioner was an agent of one Gin Company Ltd.
58A(9) of the Companies Act, 1956, the Company Law Board ordered She was also included as an accused along with the company and its
repayment of the amount in deposit together with up to date interest. directors in a complaint filed under section 138 of the NIA. The
The court by an interim order granted liberty to the depositors to file Magistrate took cognizance of the offence and issued summons to
complaints, a few depositors filed criminal cases and their payments the petitioner. The petitioner approached the High Court challenging
were settled. The company appealed against the order of the CLB. the decision of the Magistrate and recalling the issue of summons.
Decision: Appeal dismissed. Decision: Petition allowed.
Reason: The repayment of the deposits was not barred by section Reason: The persons mentioned in sub-section (2) of section 141
22 of the Sick Industrial Companies (Special Provisions) Act, 1985. are any director, manager, secretary or other officer of the company.
Quick remedial measure was an urgent need as the depositors were This gives an indication as to which person would fall within the purview
fairly old and having invested their hard earnings, were entitled to of section 14(1) of the said Act. The petitioner is neither a director,

Student Company Secretary 15 February 2007

Legal World
manager, secretary nor other office of the company. Furthermore, the were sent by the union were already under suspension and were facing
petitioner even otherwise not in charge of or responsible to the accused departmental inquiry. When their names reached the employer, the
company for the conduct of the business of the said company. It is employer sought to know as to how they were appointed/elected as
another matter that as an agent, the petitioner may have handled office bearers. Such information should have been provided to the
transactions for and on behalf of the company in India but that does employer along with the application. The respondent did not provide
not bring the petitioner within the purview of section 141which,in my this information to the employer even then demanded. The Assistant
view, is restricted to an officer of the company or a director or manager Labour Commissioner [ALC] has held that the employer had no right
or secretary. That being the case, the summoning order in so far as to seek this information. The petitioner approached the High Court
the petitioner is concerned, is liable to be set aside. The same is set under a writ.
aside and quashed to this extent. Decision: Petition allowed.
Reason: I consider that the ALC did not take a correct view of law
LABOUR & INDUSTRIAL LAWS and did not appreciate that only those office bearers have right to be
declared as protected workmen who have been appointed as office
LW(S) 12.02.2007 bearers of the union in accordance with the rules of the union. There
VOLTAS LTD v. VOLTAS EMPLOYEES UNION & ANR [136) (2007) is no presumption that once the names of the office bearers are sent
DLT 450], Shiv Narayan Dhingra, J. [Decided on 12.1.2007] for being declared as protected workmen, the persons have been
rightfully appointed as office bearers. A self appointed Executive
Industrial Disputes Act, 1947 read with Trade Unions Act, 1926-
committee of a union de hors the rules of the trade union cannot claim
Protected workman- Office bearers of a trade union elected not
protection as protected workmen under section 33(4) of the ID Act. I
in accordance with the rules of the union - Whether they can be
consider that the order of the ALC is contrary to law and express
treated as protected workmen-Held, No.
provisions of the Act. The order of the ALC is set aside the writ petition
Brief Facts: In the present case, four of the persons whose names is allowed.


In the Company Secretaries Regulations, 1982, for regulation 40, the following regulation shall be substituted, as published in the Gazette of
India(Extra Ordinary) vide Notification No. ICSI/710/1(M)/1 dated 3rd May, 2006.
40 Admission to the Intermediate Examinations -
No candidate shall be admitted to the Intermediate examination unless he/she :-
- (a) is a registered student and produces a certificate from the head of the coaching administration ( by whichever name designated) to the effect that he has
undergone satisfactorily a course of postal or oral tuition for the Intermediate examination; and
- (b) has successfully completed computer training program as may be specified from time to time by the Council and in the manner so specified
or exempted there from;
- (c) applies with such examination fee as may be determined by the council from time to time so as to reach the Secretary, in accordance with the
directions given by the Council.
In terms of the aforesaid amendment in the Company Secretaries Regulations, 1982, all students are required to successfully undergo a Compulsory
Computer Training Programme for becoming eligible for appearing in the CS Intermediate Examinations from June, 2007 examinations onwards.
The Institute, in compliance of the aforesaid amendments, has tied up with M/s NIIT through which 70 hours of computer training shall be provided
to the students/members of the Institute in all Centres of NIIT all over the country. To undergo this course, a student/member has to approach any NIIT
Centre on all India basis. To take admission, he/she has to deposit the requisite fees at the respective NIIT Centre and fulfill the formalities as per the
requirements of the Computer Training Centre.
The list of NIIT Centres including detailed course contents, module details and topic-wise time duration etc. have been published on the website of
the ICSI i.e. under FAQ.
Salient features of the course in brief : -
Title of the Course Understanding Information Technology in Corporate Environment.
Duration of the Course 70 Hours
Fee Rs.3000 per participant for General Category & Rs.2500 per participant for SC/ST Category
Note : Service Tax as per the GOI rules applicable from time to time shall be paid in actual by the participant
A student can be exempted from undergoing the course on the basis of his existing qualification/degree in the computer field subject to the conditions
that he or she enrolls himself/herself for an online exemption test (to be conducted by NIIT) at any of the NIIT Centre on all India bases and successfully
clears the test. A fee of Rs.450 plus Service Tax, etc. per student is payable for online test which is applicable for a maximum of TWO attempts within a
period of one month.
The Course is open to all the students and members of the ICSI.

Computer Training will be compulsory and pre-requisite for all the students intending to appear in the Intermediate Examination from December, 2007
session onwards. No student will be allowed to appear at the Examination to be held from December, 2007 session onwards unless he/ she successfully
completes the Computer Training.
However, a student may be permitted PROVISIONALLY to appear in the June, 2007 session only without completing the computer training with the
condition that, he/ she will complete the Computer Training before seeking enrollment to Final Examinations.

Student Company Secretary 16 February 2007

Student Services
Students seeking paperwise exemption for the first time (on
STUDENT SERVICES qualification basis) are required to remit the exemption fee @ RS.1 00
per subject in addition to the examination fee on or before the last date.
Registration of students registered upto and including March, 2002 In terms of regulation 33 of the Company Secretaries Regulations,
stands terminated on expiry of five-year period on 28th February, 2007 1982, students registered upto and including August, 2006 are eligible
leading to the following immediate consequences: to appear in both groups of the Intermediate examination to be held in
June, 2007 subject to completion of coaching and Computer Training
(a) Supply of Student Company Secretary bulletin will be and fulfilment of other conditions as laid down in the regulations.
discontinued from March, 2007 onwards. However, candidates registered as students upto and including the
(b) Response sheets will not be accepted even if submitted and month of November, 2006 are eligible for appearing in anyone group
coaching completion certificates will not be issued (after the in June, 2007 session (i.e. either in Group-lor Group-II) subject to
expiry of registration period) fulfilment of other conditions as laid down in the regulations.
They are advised to apply for registration de novo/extension III. ELIGIBILITY FOR APPEARING IN THE FINAL
of registration as per the guidelines published in this bulletin. EXAMINATION
(Students whose registration is valid upto February, 2007 are, In terms of regulation 43 of Company Secretaries Regulations,
however, eligible to appear in June, 2007 examination without seeking 1982, students who have passed/completed both groups of the
extension of registration / registration de-novo subject to fulfilling other Intermediate examination upto and including June, 2006 are eligible
requirements laid down in the regulations.) to appear in all the three groups or in combination thereof in any two
2. CHANGE OF ADDRESS groups of the Final examination to be held in June, 2007 under New
Syllabus, subject to completion of coaching and fulfilling other
Change of address, if any, should be intimated to the Institute by conditions as laid down in the regulations.
sending a separate letter in this regard. While intimating the change in
their mailing address, the students are advised to invariably quote the IV. LAST DATE FOR RECEIPT OF ENROLMENT
PIN CODE number alongwith the student registration number, name APPLICATIONS
and full postal address with city, state in capital letters. The last date for receipt of applications for enrolment to the June,
2007 examination, complete in all respects, together with the requisite
PIN CODE is required to be mentioned for quick delivery of the examination fee in the Institute, is 26th March, 2007 (25th March,
mail. Students may, therefore, check up the computerised mailing 2007 being a holiday). However, enrolment applications accompanied
address as printed on the Student Company Secretary bulletin. In with late fee of Rs. 100/-, if received in the Institute after the closing
case, it does not carry or carry the wrong PIN CODE number, the date, but on or before 9th April, 2007 will be entertained.
same may be intimated immediately quoting student registration
number and full postal address with Postal Index Number so that it Students who could not be enrolled in the earlier examination owing
could be incorporated in the computerised mailing list. to late receipt of enrolment application, cancellation of registration
etc. and whose examination fee was kept at credit, are advised to
3. STUDENTS IDENTITY CARD send fresh enrolment applications requesting therein for the adjustment
of amount at their credit together with the balance of examination fee,
All the students appearing in the examination must hold Identity if any. Formal application along with the original letter issued by the
Card in the manner prescribed by the Institute, if not already obtained institute showing credit amount, must reach the Institute on or before
at the time of seeking registration. For obtaining the Identity Card, the closing date as otherwise such students shall not be enrolled for
students are advised to obtain a proforma from the Headquarters/ appearing in June, 2007 examination.
Regional Offices of the Institute and send it again to the Institute duly
filled up and attested as per instructions given in the prospectus/ No other remittance/letter/query should be clubbed with the
registration letter. enrolment application/examination fee.
Students who have so far not obtained Identity Cards are advised to 6. CLARIFICATION REGARDING PAPERWISE
write to the Institute immediately. The students should carry their Identity EXEMPTION
Cards without fail for appearing in the Institutes examination. If the (a) The paperwise exemption is granted only on the basis of
Identity Card already issued has been lost or mutilated, student should specific request received in writing from a registered student
send a request for obtaining duplicate Identity Card together with the along with the attested photocopies of marks sheets for all
mutilated Identity Card/ldentity Card proforma duly filled in and attested parts of the Degree/examination (on the basis of which the
together with Rs. 50/- towards duplicate Identity Card fee. paperwise exemption is sought) and the exemption fee @
4. COMPULSORY ENROLMENT FOR FINAL COURSE Rs. 100/- per paper. It is one time payment and not to be
remitted for availing of paper wise exemption in every session
Students who have passed/completed both groups of Intermediate of examination during the validity of registration period.
examination are advised to seek compulsory enrolment for undergoing
coaching for the Final course on payment of Rs.4200/- towards postal (b) The application for claiming paperwise exemption must reach
tuition fee. the Institute on or before the last date for submission of
enrolment application i.e. 25th March and 25th September
Please note that a student is admitted to the final examination only for June and December examinations respectively and with a
after a minimum period of nine calendar months has elapsed since late fee of Rs. 100/-, the application can be accepted upto 9th
his/her passing the Intermediate examination and subject to completion April and 10th October respectively.
of coaching and fulfillment of other requirements.
(c) The paperwise exemption once granted holds good during
5. COMPANY SECRETARIES EXAMINATION -JUNE, the validity of registration period or passing/completing the
2007 examination, whichever is earlier.
I. EXAMINATION FEE (d) The paperwise exemption is cancelled only on receipt of a
Foundation : Rs.875 (Lumpsum) specific request in writing from the student concerned on or
Intermediate : Rs.900 (Per group) before the last date- for submission of the enrolment
Final : Rs.750 (Per group) application. If any candidate appears in the exempted paper(s)
Student Company Secretary 17 February 2007
Student Services
of examination without receiving the written confirmation from deficient response sheets immediately as such students, if failed, will
the Institute, but by making personal representation, appeal, not be allowed to appear in June, 2007 examination, unless they are
request, etc., at the Examination Centre at the last moment, issued with the regular coaching completion certificate(s) for the
his/her appearance in such paper(s) shall automatically be group(s) for which limited permission letter was issued.
treated as cancelled. Students who secure 35% or more marks in aggregate and 30%
(e) It may be noted that candidates who apply for grant of paper marks in individual paper in a group in December, 2006 examination,
wise exemption or seek cancellation of paper wise exemption are advised to submit photocopy of the marks sheet for the issue of
already granted, before the last date of submission of Coaching Completion Certificate, if eligible.
enrolment applications for a particular examination, must see 9. SUBMISSION OF RESPONSE SHEETS FOR JUNE,
and ensure that they receive written confirmation from the 2007 EXAMINATION
Institute at least 15-20 days prior to the commencement of
the examination. Candidates who would presume automatic The last date for receipt of response sheets, including resubmission,
grant or cancellation of paper wise exemption without obtaining if any, from the students who wish to be enrolled for the June, 2007
written confirmation on time and absent themselves in any examination is 28.02.2007. Students are advised to send the response
paper(s) of examination and/or appear in the exempted sheets to the Institute in a regular flow without waiting for the last date.
paper(s) would do so at their own risk and responsibility and The last date mentioned above is just an indicator for students who
the matter will be dealt with as per the above guidelines. suitably plan their submission. This will not only give the Institute
reasonable time to get the response sheets evaluated in time but also
(f) Exemption once cancelled on request in writing shall not be an opportunity to the students to resubmit the response sheets in which
granted again under any circumstances. they have failed to obtain a minimum of forty per cent marks. Students
(g) The candidates who have passed either group of the are advised to get acknowledgement from the Institute for the response
Intermediate/Final examination under the old syllabus, may sheets sent by attaching a self addressed stamped post card. It may
claim the paperwise exemption in the corresponding subject(s) be noted that credit is given for the response sheets received in the
of new syllabus indicating the basis of exemption as APO in Institute on or before the stipulated due date, as above. Name of
the appropriate column of the enrolment application. student, registration number, subject, test paper number, number of
(h) In case the paperwise exemption has already been granted sheets used and postal address with PIN code number should be
on the basis of qualification or the candidates is eligible for written on the title sheets attached with each response sheet. The
grant of exemption on the basis of securing 60% or more above information may also be indicated on the first, middle and last
marks, a photocopy of the letter/marks-sheet issued by the pages of each response sheet besides mentioning the Registration
Institute should be enclosed with the enrolment application Number on each page on the right hand corner on top. It will facilitate
while claiming such exemption, failing which the same may early evaluation and return of the evaluated response sheets. It may
not be granted for the ensuing examination. be noted that no response sheet will be entertained by the Institute in
the absence of above information. Accordingly, no credit will be given
(i) No exemption fee is payable for availing paperwise exemption to students of such response sheets received by the Institute.
on the basis of APO or on the basis of securing 60% or
more marks in the Institutes examination. Students are also advised to write the subjecUpaper, number of
sheets used and examination correctly on the title sheet before sending
(i) Paperwise exemption fee is payable only when the exemption the response sheets to the Institute. Similarly, relevant title sheets
is to be availed on the basis of qualification(s) specified for may be appended with them. There are separate title sheets for
the purpose. Foundation, Intermediate and Final course. Even when the response
7. EXEMPTION FROM COMPUTER TRAINING sheets are sent in a bunch, complete particulars are to be given on
A student can be exempted from undergoing the course on the basis each title sheet and first, middle and last pages of each response
of his existing qualification / degree in the computer field and qualifies sheet. No cognizance of the response sheets will be taken if the student
the need of Course Contents Syllabus as scheduled by NIIT for C.S. fail to comply with the above instructions. It is emphasized that separate
Students, subject to the condition that he or she enrolls himself / herself title sheets are to be attached with each response sheet.
for an online exemption test (to be conducted by NIIT) from any of the Students are aware that the Institute has made arrangements for
NIIT Center on all India basis and successfully clears the test. . acceptance of response sheets for Foundation, Intermediate and Final
8. COMPLETION OF COACHING AND FILLING UP Course in its Regional/Chapter Offices in Ahmedabad, Bangalore,
OF EXAMINATION FORMS Kolkata, Chennai, Delhi, Hyderabad, Jaipur, Kanpur, Mumbai, Madurai
and Pune. Students located in and around these cities are advised to
At times queries are received by the Institute from the students with contact and submit their response sheets in the respective Regional/
regard to filling up of examination forms for want of issue of coaching Chapter offices.
completion certificate. It is clarified that students (i) who are undergoing
oral coaching, and (ii) students who have submitted or re-submitted 10. IMPORTANT
their response sheets and/or would be submitting or re-submitting the While making any correspondence regarding examination, the
response sheets within the stipulated period, are eligible to fill up the students are advised to quote the following particulars for taking prompt
examination forms for the respective session of examination Such action:
students need not withhold the submission of their examination forms i) Name in full (ii) Student Registration number (iii) Stage of
for want of coaching completion certificates. The students concerned examination (Intermediate/Final) (iv) Group opted (v) Centre
are advised to make a note in the application form to the effect that they opted (vi) Particulars of fee remitted, i.e. Demand Draft
are undergoing oral coaching/have submitted response sheets and are (printed) number, date, amount, name of the bank and its
awaiting coaching completion certificates. Since there cannot be any branch (vii) Date and mode of despatch of enrolment
change with regard to the closing date for submission of examination application and their complete address with PIN code,
forms, students need not wait for the issue of coaching completion telephone number, mobile number or e-mail address.
certificates for filling up their examination forms. They are advised to In case of any specific problem/complaint regarding registration,
mention against the appropriate column in the enrolment application post-registration, students services and postal/oral coaching, students
form that coaching completion certificates are being awaited. may contact personally or write to Sohan Lal, Joint Director and for
Students who were issued with limited permission letters, for academic guidance and suggestions, if any, students may write to V K
appearing in December, 2006 examination, are advised to submit the Aggarwal, Principal Director, at the Institutes address.

Student Company Secretary 18 February 2007

Student Services
6. It is again emphasised that students who have already been
ATTENTION STUDENTS granted exemption in any paper included in the group for which
INTENDING TO APPEAR IN COMPANY SECRETARIES the enrolment has been sought, must indicate in the appropriate
EXAMINATION JUNE, 2007 column of the enrolment application and enclose a photocopy
1. (a) Last date for receipt of Examination 26.03.2007* of the letter issued by the Institute granting such exemption.
application in the Institute Similarly, in those cases where the student has applied for
exemption for the first time, the same must also be indicated in
(b) With a late fee of Rs. 100 09.04.2007 the appropriate column of the enrolment application form along
2. Examination fees with the attested photocopies of the relevant marks sheets and
Foundation Rs.875 (Lumpsum) the exemption fee.
Intermediate Rs.900 (Per group) 7. In case, student is interested in cancellation of exemption which
has already been granted to him, a separate request should be
Final Rs.750 (Per group) made for the same along with the enrolment application. Please
3. Last date for seeking paperwise 26.03.2007* note that once paperwise exemption is cancelled, it shall not be
exemption restored/reviewed under any circumstances.
4. Last date for seeking extension 26.03.2007* 8. No exemption fee is payable for availing of paperwise exemption
on the basis of APO (already passed under old syllabus) or
of registration/registration de-novo
securing 60% or more marks in the Institutes examination.
*(25- 03-2007 being a holiday)
XI Mode of Payment : Students who intend to pay the fees by
Notes : demand draft may please ensure that it should be crossed and
I. The examination fee stands revised as above. drawn in favour of The Institute of Company Secretaries of
India, payable at New Delhi.
II. Examination fee is payable on groupwise and not on paperwise
basis for intermediate/Final examinations. XII Students Identity Card : All the candidates appearing in the
III. All students appearing in the Intermediate examination are re- Company Secretaries Examination are advised to timely complete
quired to complete successfully the Computer Training before necessary formalities for obtaining their identity cards duly
filling up the examination form EXA countersigned by the issuing authority of the Institute as per
instructions published in the prospectus Career in Company
IV. The students who have submitted/ would be submitting all the Secretaryship A Handbook.
response sheets within the stipulated time, may submit their en-
rolment applications for appearing in the examination pending
issue/receipt of the coaching completion certificates. But coach-
ing completion certificate would be issued only when they have
successfully completed the coaching for the group(s) concerned.
V. Please note that unsigned, incomplete and applications not filled
in their own handwriting by the students will not be accepted.
VI. No change of group(s) will be allowed after submission of the
enrolment application.
VII. No request for change of medium for writing the examination will
be entertained after submission of the enrolment application.
VIII. No cutting and over writing is to be done in the examination form.
IX. No request for grant/cancellation of paperwise exemption shall
be entertained after the last date i.e. 25th March/25th September
for June/December examination respectively.
X. No request/correspondence for withdrawal of application
from appearing in the examination or adjustment of amount
for the next examination shall be entertained after submis-
sion of the examination form under any circumstances.
Students are, therefore, once again advised to fill in the enrolment
applications/examination forms EXA carefully to avoid last moment
problem for themselves as well as for the Institute.
All the students appearing in the examination are required to enclose
the photocopies of the following documents with their enrolment
application forms :
1. Certificate for completion of Computer Training issued by the re-
spective centre.
2. Letter granting the paperwise exemption (wherever paperwise
exemption has been granted on the basis of qualification).
3. Marks-sheet for availing paperwise exemption on the basis of
securing 60% or more marks in the earlier examination of the
4. Original letter issued by the Institute showing the credit balance,
if any, for adjustment towards the examination fee.
5. Coaching Completion Certificate, if already issued from the

Student Company Secretary 19 February 2007

Student Services
EXAMINATION the candidates in their own interest are timely advised to keep
track of important announcements, last dates and observe the
time schedule.
EXAMINATION RESULTS Candidates are allowed to bring and use their own battery
operated, noiseless and cordless pocket calculators with not more
Results of the Foundation Course, Intermediate and Final
than 6 functions, 12 digits and 2 memories. Exchange or lending/
examinations of the company secretaries held in December, 2006
borrowing of calculators among students is forbidden in the
are scheduled to be declared at 4.00 P.M. on Sunday, the 25th February,
examination hall.
2007. As in the past, the results will be displayed simultaneously on
the Notice Boards at the Institutes Headquarters, Offices of the 5. HINDI AS AN OPTIONAL MEDIUM FOR WRITING
Regional Councils and Chapters, and Examination Centres. The results THE FOUNDATION, INTERMEDIATE AND FINAL
along with break-up of subjectwise marks will also be available on EXAMINATIONS
Institutes Website on 25th February, 2007 from 4.00 Candidates are allowed to use Hindi as an optional medium for
P.M. onwards. writing all papers of the Foundation Course (except: English &
The result-cum-marks statements will be despatched to all Business Communication paper) , Intermediate and Final
candidates latest by 3rd March, 2007. Meanwhile, if there has been examinations on the following conditions:
any change in the mailing address of a candidate, he/she should (i) option of Hindi Medium for writing the examination is to be
immediately intimate the same enclosing a self-addressed envelope exercised for all papers of an examination OR a particular group
of 23 cms. x 11 cms. size for posting his/her result-cum-marks of examination, and not for any individual paper(s) in the enrolment
statement at the changed address. Further, any candidate who does application form for each term of examination;
not receive his/her result-cum-marks statement by 14th March, 2007,
(ii) option of medium for writing examination once exercised is
should immediately write to the Sr. Director (Exams.) for issuing irrevocable for that particular session of examination;
duplicate marks statement giving relevant particulars, i.e., his/her name,
student registration number, stage of examination and group(s) in which (iii) answer books of candidates who write part of papers/answers in
he/she appeared, roll number, examination centre along with a self- one medium and the remaining part in other medium are liable to
addressed stamped envelope worth Rs.5/-. be cancelled without any notice;
2. VERIFICATION OF MARKS (iv) candidates who have exercised option of Hindi medium in their
examination enrolment form for writing Foundation Course
In terms of regulation 46 (2) of The Company Secretaries examination and Group-I of Intermediate examination will be
Regulations, 1982, as in force, a candidate can seek Verification of provided Question Papers printed both in English and Hindi version
Marks in any subject(s) of December, 2006 examination within one (except in English & Business Communication paper which
month from the date of declaration of results. The application for will be printed/required to be answered in English only). The
verification of marks should be made on a plain paper, in candidates Question Papers for Group-II of the Intermediate examination
own handwriting together with requisite fee @ Rs.100/- per subject and all papers of Final examinations will be printed in English
within 30 days from the date of declaration of results, i.e., upto 26th version only;
March, 2007 (25 th March, 2007 being holiday) . Candidates are
(v) if a candidate writes his/her answers in Hindi medium without
advised not to club any other query/matter or remittance along exercising such an option in the enrolment application form, he/
with his/her request for verification of marks to facilitate an early she may not be given credit for his/her answers;
(vi) candidates opting Hindi medium for the examination must write
After completion of verification process, candidates are individually HINDI MEDIUM in bold letters on the top of the cover page of
communicated outcome of the verification of marks, normally within Answer Book No.1 OR 1B, as the case may be; and
2-3 weeks time. However, if a candidate does not receive any
communication by 20th April, 2007, he/she should write to the Sr. (vii) candidates opting Hindi medium for the examination may write
Director (Exams.) giving relevant details (i) his/her name; (ii) student answers to practical questions, headings, quotations, technical
registration number; (iii) stage of examination and roll number; and legal terms, sections, rules, etc., in English medium, if they
so desire.
(iv) name of the subject(s) in which verification of marks was sought;
(v) date of application and mode of its despatch; (vi) amount of 6. AVAILING OF CONCESSION BY PHYSICALLY
verification fee and mode of its remittance, viz., Bank Draft No., date DISABLED CANDIDATES FOR WRITING
of issue of Bank Draft, Name of drawee and drawer bank; and EXAMINATIONS
(vii) complete postal address along with PIN Code. Any physically disabled student who requires some concession
3. JUNE, 2007 EXAMINATIONS or assistance which is normally admissible under the rules for the
Next examination for the Foundation Course, Intermediate and purpose of appearing or writing the examination, for that he/she should
Final, scheduled in June, 2007, will be held from Saturday, the 02nd make a separate written request along with his/her application for
June, 2007 to Sunday, the 10th June, 2007, as per the Time-Table and enrolment to the examination together with the following supporting
Programme published on the last cover page of this issue. The last documents :
date for receipt of enrolment application for June, 2007 examinations (i) Disability Certificate issued by the Medical Board/Head of Deptt.
in the Institute together with the requisite examination fee is 26th March, or Sr. Medical Officer (Specialists) of a Central or State Govt.
2007 (25th March, 2007 being holiday) and with late fee of Rs.100/- Hospital certifying the nature (permanent or temporary) and
upto 9th April, 2007. percentage of disability, and its duration affecting the normal physi-
Important : Candidates should note that non-receipt/delayed cal functions; and
receipt of result-cum-marks statement, response to result queries, (ii) Letter of Permission issued by Sr. Secondary Board/University
verification of marks, etc., will not be accepted as valid and and/or any other professional/educational examining body, such
sufficient reason for seeking any relaxation or not complying with as UPSC, SSC, State Public Service Commission, ICAI, ICWAI,
the requirements of regulations and/or last dates for submission etc., granting him/her assistance of a Scribe and/or extra-time for
of enrolment applications for the next examinations. Therefore, writing examinations.

Student Company Secretary 20 February 2007

Student Services
DECEMBER, 2006 EXAMINATIONS Statement about ownership and other particulars of Student
Company Secretary
The Institute awards Merit Scholarships and Merit-cum- 1. Place of Publication : New Delhi
Means Assistance to students for pursuing Intermediate and 2. Periodicity of Publication : Monthly
Final Courses on the basis of their meritorious performance in 3. Printer's Name : N.K. Jain
the examinations and/or merit-cum-need basis on their passing Whether Citizen of India : Yes
Foundation and Intermediate examinations respectively, as per If foreigner, State the country : Not applicable
the criteria stipulated under the Merit Scholarship (Company of origin
Secretaryship Course) Scheme, 1983 and Merit-cum-Means Address : Secretary & Chief Executive
Assistance (Company Secretaryship Course Scheme), 1983. Officer, The Institute of
MERIT SCHOLARSHIP Company Secretaries of India,
In pursuance of para 7 of the Merit Scholarships (Company 'ICSI House', 22, Institutional
Secretaryship Course) Scheme, 1983, 15 numbers of scholarships Area, Lodi Road, New Delhi-
are awarded each for Intermediate and Final examinations per 110003
session only to registered students, purely in order of merit, from 4. Publisher's Name : N.K. Jain
amongst the candidates who appeared and passed in all the Whether Citizen of India : Yes
subjects of their respective examination, at first attempt, in one If foreigner, State the country : Not applicable
sitting, without claiming any exemption in any subject, on all-India of origin
basis and subject to fulfilling other terms and conditions as Address : Secretary & Chief Executive
stipulated in the said scheme. Officer, The Institute of
Company Secretaries of India,
Accordingly, students who pass the Foundation examination, 'ICSI House', 22, Institutional
December, 2006 should get themselves registered with the Institute Area, Lodi Road, New Delhi-
for pursuing Intermediate course within 3 months from the date of 110003
declaration of results to become eligible for award of Scholarship. 5. Editor's Name : N.K. Jain
MERIT-CUM-MEANS ASSISTANCE Whether Citizen of India : Yes
In pursuance of para 8 of the Merit-cum-Means Assistance If foreigner, State the country : Not applicable
(Company Secretaryship Course) Scheme, 1983, 15 numbers of of origin
financial assistance are awarded each for Intermediate and Final Address : Secretary & Chief Executive
examinations per session only to registered students. According Officer, The Institute of
to the scheme, a candidate has to apply in the prescribed form Company Secretaries of India,
obtainable from the Institute, and submit his/her application within 'ICSI House', 22, Institutional
a specified date as notified from time to time. Any candidate Area, Lodi Road, New Delhi-
applying for financial assistance should have passed the 110003
Foundation/Both Groups of Intermediate examination, at first 6. Name and Address : Not applicable
attempt, in one sitting, without claiming exemption in any subject. of individual who Official journal of the
If the candidate is employed or having an independent source of own the newspaper Institute of Company
income, in that case his/her income should not be more than and partners or Secretarties of India
Rs.1,50,000/- per annum and if he/she is dependent on his/her shareholers holding
parents/guardian/spouse, then the combined income from all more than one per cent
sources should not be more than Rs.2,50,000/- per annum and of the total capital
also subject to fulfilling other terms and conditions as stipulated in I, N.K. Jain, hereby declare that the particulars given above are
the said scheme. true to the best of my knowledge and belief.
Students who pass the Foundation examination, December,
2006 must get themselves registered with the Institute for pursuing
Date : 15th Feb., 2007 Signature of the Publisher
Intermediate Course within 3 months from the date of declaration
of results to become eligible for award of this financial assistance.
A separate notification inviting applications for award of Merit-
cum-Means Assistance will be published in the March/April and OPENING OF NEW EXAM. CENTRES AT KOLHAPUR AND
September/October issue of C.S. Foundation Course Bulletin SRINAGAR FOR CS EXAMINATIONS
and Student Company Secretary Bulletin.
The Institute is pleased to announce opening of two new
Examination Centres at following places for conduct of 'Company
E-MAIL ADDRESS OF THE STUDENTS Secretaries' examinations for the next three sessions to be held in
June, 2007, December, 2007 and June, 2008 purely on
Those students who are having e-mail address may communicate experimental basis:
the same to the Students Services Section at which
will facilitate quick and economic communication from the Institutes Sl No. Place Centre Code
side. The e-mail address may be sent in the following format. 1. Kolhapur 417
2. Srinagar (J&K) 227
Name : Accordingly, students are welcome to opt for the new Examination
Registration No. : Centre in their enrolment applications for appearing in the
E-mail Address : forthcoming examinations.

Student Company Secretary 21 February 2007

Quiz - Prize Winners
appealed to the Hon'ble Supreme Court.
STUDENTS QUIZ The Hon'ble Apex Court upheld the issue of bonus shares and
reasoned that the issue of bonus shares out of revaluation reserve is
PRIZE QUERY valid. Section 205(3) of the Companies Act, 1956 provides for
AB Limited is controlled by two groups headed by C and D. capitalization of profits or reserve of a company for the purpose of
Differences arose between C and D in management of AB issuing fully paid up bonus shares or paying up any amount for the
Limited and this difference landed before the Company Law time being unpaid on any shares held by the members of the company.
Board (CLB) for adjudication. At the intervention of CLB, a The Companies Act does not specifically prohibit utilization of reserve
settlement was reached between C and D. This settlement was arising out of the revaluation of assets for purpose of issuing fully paid
incorporated in the Order of the CLB. Subsequently the up bonus shares.
settlement was not implemented. C applied to CLB for Now Ministry of Company Affairs
enforcing the implementation of the settlement while D applied It was clear that the words 'available for dividends' as appearing in
for the recall of the order of CLB. CLB refused to enforce the the articles of the company, would be applicable to all categories.
settlement. Is CLB right in refusing to enforce the Therefore, the Hon'ble High Court was wrong in concluding that these
implementation of its order? words only applied to the last category, that is, funds of the company
CONDITIONS or in the hands of the company. However, it must be seen that the
1. Answer should not exceed one page typed in double space. word 'dividend' wherever it appears in the articles of association also
The answer sheet should contain the name, registration number includes 'bonus'. Thus the words 'available for dividends' would
and address of the student. necessarily mean 'available for dividend/bonus'.
2. Last date for receipt of answer is 16th March, 2007. Article 182 of the company provides that where the law permits
3. Two prizes (a first and a second) in kind will be awarded to the issuing of bonus shares from appreciation of value in the capital assets,
best answers and the names of the contributors will be published the same could be done. The proviso to sub section (3) of section 205
in the Bulletin. also permits capitalization of profits or reserve of a company for the
4. The envelope should be superscribed Students Query, purpose of issuing fully paid up bonus shares or paying up any amount
February 2007 and addressed by name to N.K. Jain, Secretary for the time being unpaid on any shares held by the members of the
& Chief Executive Officer, The Institute of Company company. Clearly, the Companies Act specifically permits utilization of
Secretaries of India, ICSI House, 22, Institutional Area, Lodi reserve arising out of the revaluation of assets for purpose of issuing
Road, New Delhi-110003. fully paid up bonus shares.
Thus it can be observed that while the executive has one view on
QUIZ - PRIZE WINNERS the issue the judiciary has another view on the same. It is also a
question as to who should be the competent authority to interpret the
September 2006 law enacted by the Parliament. It is also a wider question to be
QUERY examined as to whether SEBI and DCA can frame rules and regulations
A company issued bonus shares from out of revaluation in conflict with the Companies Act. Since the word reserve as mentioned
reserve. The Articles of Association of the company authorized in the Companies Act gives rise to different definitions and is not
such an issue. Is such an issue of bonus shares valid in law? specifically defined in the concerned section, the same has led to the
above conflicts. In all such cases the right forum to decide the issue
WINNERS would be the judicial review of the law, rules and regulations. But it is
First Prize not known whether all these issues were agitated before the Hon'ble
T.S.Anandhi (SR0257791/02/2003) S-3, Sangath Apartments Supreme Court. It is submitted that a clear decision on the issue should
MGR Nagar 1 Street, Velachery, Chennai 600042. be taken after the SEBI, DCA and concerned companies make their
submission in this regard.
Second Prize
However, as a judicial precedent has been set and all laws, rules
J. Swaminathan (CR0329949/06/2007), 115, I Floor, Luz Church and regulations enacted are subject to judicial review and the view of
Road Mylapore, Chennai 600 004. the Hon'ble Supreme Court in the matter is final, it can be concluded
ANSWERS that in the above case the company can issue bonus shares out of the
First Prize revaluation reserves.
There is a conflicting view between the Courts and Department of Second Prize
Company Affairs* and SEBI regarding issue of bonus shares out of The Law permits issue of bonus shares out of revaluation reserve
revaluation reserve. In respect of listed companies SEBI (Disclosures of the company.
and Investor Protection) Guidelines, 2000 clearly lays down that bonus Provisions Applicable : The said issue is dealt under Section 205(3) of
shares cannot be issued out of reserves created by revaluation of the Companies Act, 1956 and which is subject to the provisions of the
fixed assets. Department of Company Affairs has vide its Circular No.9/ Articles of Association of the company.
94 dated 6.9.1994 has prohibited private/closely held and unlisted
Reasons : The Companies Act, 1956 specifically permits utilization of
companies from issuing bonus shares from reserves created out of
reserve arising out of revaluation of assets for the purpose of issuing
revaluation of fixed assets.
fully paid up bonus shares. In this regard, sub section (3) of section 205
However, in a similar case of Bhagwati Developers v. Peerless permits capitalization of profits or reserve of a company for the purpose
General Finance & Investment Co. and others ( 2005) 5 Comp LJ 377 of issuing fully paid up bonus shares or paying up any amount for the
(SC); (2005) 62 SCL 574 (SC) the company intended to capitalize time being unpaid on any shares held by the members of the company.
reserves by issuing bonus shares out of revaluation reserve and at a The said issue has been recently dealt with by the Supreme Court
meeting of the company a resolution to this effect was passed. One hence reliance is also placed on the following judgment of the Supreme
share holder challenged the issue of bonus shares out of revaluation Court:
reserve which was rejected by the Hon'ble High Court. The appellant
Bhagwati Developers v. Peerless General Finance and Investments
* Now Ministry of Company Affairs. Company and others [2005] 5 Comp LJ 377 (SCC).

Student Company Secretary 24 February 2007

Quiz - Prize Winners
In this case the matter was before the Supreme Court as a result Resplendents Ltd. (JT 2006 (2) SC 562) the company procured duty
of an appeal from the orders of the High Court which considered the paid plain ceramic glazed tiles and processed them into decorated
issue of bonus shares out of revaluation reserve as legally valid. The glazed ceramic wall tiles by applying drying and colouring processes.
Supreme Court upheld the order of the High Court by placing reliance The Department considered these process as manufacture and
on the following points: demanded excise duty from the company. The company argued that
a. The word 'dividend' wherever it appears in the articles also includes the processes applied by it was not amounting to manufacture. The
'bonus', and thus the words available for dividends would case reached the Hon'ble Supreme Court for final adjudication.
necessary mean "available for dividends/bonus.' The Hon'ble Apex Court held that the point which falls for
b. The term 'available for dividends' would be applicable to all consideration in this case is whether printing/decorating duty paid plain
categories. glazed ceramic tiles amounts to manufacture or not. The process for
amounting to manufacture must be one which brings into being a new
c. Thus the High Court was wrong in concluding that these words substance known to the market. Manufacture implies a change but every
only apply to the funds of the company. change is not a manufacture and yet every change in an article is the
d. The Supreme Court also pointed out that the High Court was right result of some treatment, labour and manipulation. For manufacture
in concluding that, as per Article 182 of Articles of Association there something more is necessary. There must be transformation and a new
is nothing to prohibit the company from issuing bonus shares. article must result, having a distinct name, character or use.
Apart from complying the provisions of section 205(3) of the Companies These conditions were not satisfied in the instant case because
Act, 1956 the Articles of Association of the company must contain a ceramic glazed tiles remain ceramic glazed tiles even after the process
provision for the issue of bonus shares out of revaluation of reserves. of printing and decorating. Transformation of a product must be such
that it becomes commercially different commodity to attract central
October 2006
excise duty and unless a new and distinct article known commercially
QUERY to the market emerges, the process would not amount to manufacture.
A public limited company procured plain glazed creamic duty In the present case no distinct commodity came into being as a result
paid tiles and processed them into decorated glazed ceramic wall of process carried out. The contention of the Department that ceramic
tiles by applying drying and colouring processes. The Department glazed tiles which are subject to printing and decoration would be
of Central Excise considered the processing done by the public commercially useless but for the process carried out was not right. In
limited company amounted to manufacture and levied excise duty the present case the decorated glazed ceramic wall tiles after their
on the finished product. Is the action of the Department Correct decoration did not change their basic character viz. glazed tiles and
in Law? therefore did not undergo a process of manufacture.
WINNERS Therefore, it can be concluded that the action of the Department in
considering the processing of drying and colouring of the plain glazed
First Prize ceramic wall tiles by the company as amounting to manufacture and
T.S. Anandhi (SR0257791/02/2003) S-3, Sangath Apartments, MGR levying of excise duty on the finished product will not stand judicial scrutiny.
Nagar I Street, Velachery, Chennai 600 042 Second Prize
Second Prize The case in question calls for consideration whether printing/
R.Pattu Rathi (SR0246083/09/2002) 5/286, Annai Indhira Nagar I decorating duty paid plain glazed ceramic tiles amounts to manufacture
Street, Tuticorin, Tamilnadu-628002 or not. The factum probans (relevant facts) and causa (circumstances)
of the given query are exactly similar to those of the recent Supreme
Court decision in Commissioner of Central Excise v. Pan Pipes
First Prize Resplendents Ltd [JT 2006 (2) SC 562] Ashok Bhan & C. K. Thakker,
The question of what would amount to 'manufacture' which is the 11. [Decided on 1.12.2005].
heart of the excise law has been agitated many times before the judicial In this case : (i) The respondent (assessee) procured plain glazed
forum. However, by design or otherwise the Act has not defined the ceramic duty paid tiles and by applying drying and colouring processes
term 'manufacture'. The Department in its quest to increase the revenue converted them into decorated glazed tiles. (ii) The appellant
tries to classify each and every process as manufacture and levies tax considered the processes done by the assessee as manufacture and
on the same. On the other hand the manufacturers try to wriggle out levied excise duty on the finished product. (iii) The respondent
of the same by trying to convince the Department that the process challenged the duty denying that the process applied to it does not
does not amount to manufacture. Many a time the issue has been amount to manufacture.
elevated to the highest judicial body of the country to obtain a ruling When the matter finally came up before the Supreme Court it
on the issue and to decide what amounts to 'manufacture'. The definition dismissed the appeal on the following grounds: a) As manufacture is
of the term 'manufacture' is very important as only then the Department the focal point in determining levy of excise duty it is essential to find
would be able to levy excise duty on the goods. In addition, the term out whether the process is a manufacture or not. b) Manufacture implies
'salability' is also important. In the land mark judgement of UOl v. Delhi every change but every change is not manufacture; and yet every
Cloth and General Mills case (ELT-1977-J.199) the Hon'ble Supreme change of an article is the result of treatment, labour and manipulation.
Court succinctly explained what constitutes manufacture. Manufacture But something more is necessary and there must be a transformation.
implies a change but every change is not a manufacture and yet every c) A product can be construed as manufactured if and if only it emerges
change in an article is the result of some treatment, labour and as a result of changes on the inputs and such changes have brought
manipulation. For manufacture something more is necessary. There in new characteristics or use or name as against the inputs themselves.
must be transformation and a new article must result, having a distinct d) Mere value addition through a process would not tantamount to
name, character or use. manufacture.
It is, by now, well settled that a product can be construed as In the Instant case these conditions are not satisfied as no distinct
manufactured if and only if it emerges as a result of changes on the article known to the market emerges as a result of the process carried
inputs and such changes have brought in new characteristics or use out by the respondent.
or name as against the inputs themselves. Mere value addition through Applying the ratio of the above cited case to the case in question it
a process would not tantamount to manufacture. can be concluded that the action of the Department of Central Excise
In a similar case of Commissioner of Central Excise v. Pan Pipes is against the law and incorrect.

Student Company Secretary 25 February 2007

News and Announcements
The speakers were Om Prakash Mutha, Chairman NIRC, Hitender
NEWS AND ANNOUNCEMENTS Mehta, Secretary, NIRC and S. Koley, Member, NIRC. After the
inauguration of the programme Om Prakash Mutha in his address to
EASTERN INDIA REGIONAL CONCIL the students gave important tips to them. He said that the syllabus of
the company secretaries course has been designed to produce
BHUBANESWAR CHAPTER Corporate Executives. Efforts are being made to upgrade the course
CAREER AWARENESS PROGRAMMES contents so that the product of the Institute becomes a Specialist
Manager. He emphasized the need of hard work, regularity and
The Chapter organized a series of Career Awareness Programmes sincerity while pursuing studies. Admitting that the coaching facilities
from 30.11.2006 to 09.12.06 at Bhubaneswar Chapter and other are a necessary part of studies, he insisted that a student must read
neighbouring places covering four districts i.e. Cuttack, Puri, Khurda & the lesson first and then revise also after taking a tuition. Then only
Nayagarh, wherein I.J. Kalucha, Consultant, the ICSI was the main the depth of the subject can be understood and learnt. He explained
speaker in all the programmes. Kalucha during his visit conducted 38 to the students that the e-governance initiative of the Government has
career awareness programmes/activities including 8 programmes in opened new avenues for the company secretaries, which has led to
schools, 20 programmes in colleges, Meeting with Prof. L.N.Mishra, the development of the profession. He proclaimed that the industry is
Vice Chancellor, Utkal University, Meeting with the HOD & Faculty ready to welcome fresh company secretaries with attractive packages.
members of P.G. Department of Commerce, Utkal University, Therefore, the students must take up the course very seriously and
Bhubaneswar, 7 meeting with the Principals & Faculty Members of not as a part time course. He said although he himself was a Chartered
Schools/Colleges and inaugurated one Accredited Oral Tuition Centre Accountant and a Cost Accountant also but he had no hesitation in
of the ICSI for CS Foundation Course at Nayagarh Autonomous College, admitting that the course contents of CS is undoubtedly the best. He
Bhubaneswar. The Chapter was represented by U.C.Mishra, Chapter also tactfully dealt with various queries of the students.
Official in all the aforesaid activities. The number of participants taken
Hitender Mehta felt that company secretaries are liked by the
together in all the career awareness programmes was more than 3000.
industry as a Compliance Officer now due to their depth of knowledge.
CELEBRATION OF BASANT PANCHAMI Mehta informed the students that with the adoption of e-governance
On 23.1.2007 the Chapter celebrated Basant Panchami Puja of by the WTO Regime, young Indian professionals will have the
Devi Sarswati at its premises amidst the presence of the students and opportunity to invade 150 countries.
members of the Chapter. The Chapter office was colourfully decorated Koley lured the students towards the glory of professional practice.
by the students on the day. The Chapter office was opened whole day He said that MCA-21 has opened wide scope for C.S. Practice.
for visit of the students, members and others and for offering prayer to JAIPUR CHAPTER
Goddess Saraswati. On 25.1.2007, Goddess Sarswati was taken for
immersion to the river Kuakhai. CAREER AWARENESS PROGRAMMES
INAUGURATION OF COLLABORATIVE ORAL The Chapter conducted Career Awareness Programmes at different
COACHING CENTRE AT NAYAGARH AUTONOMOUS places of Rajasthan from 18.12.2006 to 23.12.2006 which were as
COLLEGE, NAYAGARH, ORISSA under : On 18.12.2006 the Career Awareness Programmes were held
at Govt. Dunger College,M.S.Girls Govt. College and Jain Girls College
On 9.12.2006 the ICSI Collaborative Oral Coaching Centre was at Bikaner. About 250 students attended the programmes.
inaugurated at Nayagarh Autonomous College, Nayagarh, Orissa by
I.J. Kalucha, Consultant, the ICSI. The function was attended by a On 19.12.2006 the Career Awareness Programmes were held at
large number of students and teachers of various faculties. B.J.S. Rampuria College and Shree Nehru Sarda Peeth at Bikaner.
About 150 students attended the programmes.
NORTHERN INDIA REGIONAL COUNCIL On 20.12.2006 the Career Awareness Programmes were held at
TALK ON HOW TO PREPARE FOR EXAMINATIONS Suratgarh Degree College, Govt. College,Rathi Public Senior
Secondary School, Saraswati Bal Mandir Higher Secondary School,
On 7.12.2006 the Regional Council organised a talk on the above Sharma Bal Mandir Higher Secondary School, Priya Darshan Public
topic at ICSI-NIRC Auditorium, New Delhi. Guest speaker J.K. Bareja, School and Tagore Central Academy Sr.Secondary School all at
FCS shared with the students valuable tips about the material to be studied, Suratgarh. About 700 students attended the programmes.
how it is to be studied, how to read the question paper and write the
answers to the questions and what are the Dos and Donts in the On 21.12.2006 the Programmes were held at MD Girls College
examination hall. Bareja also replied the queries raised by the students. and Saheed Bhagat Singh College at Raisingh Nagar and at Gyan
Jyoti College and Gyan Jyoti Sr. Secondary School at Sri Karanpur.
A.K. Srivastava, Executive Officer of the Regional Office in his About 500 students participated in the programmes.
motivational and enthusiastic address explained the profile of a
company secretary in the corporate sector. The programme was On 22.12.2006 the Programmes were held at Govt. College and
attended by more than 150 students. Choudhary Ballu Ram Godara Girls College at Sri Ganganagar.
Around 350 students attended the programmes.
On 23.12.2006 the Career Awareness programmes were held at
On 3.12.2006 the Regional Council conducted a Career Awareness M.D. College, S.G.N. Khalsa College & Seth G.L. Bihani Sanatan
Programme at Non-Collegiate Womens College, Rohini, Delhi. Again Dharam College at Sriganganagar. More than 500 students
on 22.12.2006 a Career Fair was organised at Vivekanand College, participated in the programmes.
Vivek Vihar, Delhi. Guest speakers in the first institution were J.K.
In one such programme ICSI Corporate Kit was presented to the
Bareja, FCS; Swati Patil, ACS and A.K. Srivastava, Executive Officer
Vice Chancellor of Bikaner University.
of the Regional Office. K.K. Narula, Administrative Officer of the
Regional Office addressed the Career Fair in the second institution. A KANPUR CHAPTER
good number of students attended the Career Awareness Programme/ COMMENCEMENT OF ORAL COACHING CLASSES
Career Fair. During the programmes the students were apprised about
On 6.1.2007 the Council organized the inaugural function on the
the mode of registration in the CS course, syllabus, structure of the
eve of commencement of Oral Coaching Classes of Intermediate both
course and also the avenues available to the profession both in
groups for the session ending June, 2007 at its premises. Dr. A.S.
employment and in practice. Pamphlets explaining Career in Company
Bhatnagar, HOD, VSSD Law College, Kanpur inaugurated the classes.
Secretaryship Course were also distributed to the students.
In his address Dr. Bhatnagar said that he was associated with Kanpur
Chapter for last around 20 years as faculty member. He felt proud as
CAREER BUILDING PROGRAMME his students were elected as office bearers of the Chapter. As Chapter
On 7.1.2007 the Chapter conducted a Career Building Programme. has been adjudged for the best Chapter of the Institute, continuously

Student Company Secretary 26 February 2007

News and Announcements
for four times. He advised the students to work hard and plan their and Andhra Pradesh. Another write up about the course has been
study. First they should be very clear in their minds about the objective published in Dinamani, a leading Tamil daily in Elaignar Mani dated
goal which they propose to pursue and second they should put in all 22.1.2007 arranged by SIRO.
efforts to achieve that objective. He wished them all a grand success. TENTH TRAINING ORIENTATION PROGRAMME
Vineet Tripathi, Chapter Chairman briefed the students about the On 8.1.2007 the Regional Council organized the inaugural session
scope of the profession. He informed them about the position, functions of the 10th Batch of Training Orientation Programme at ICSI SIRC
and responsibilities of a company secretary in employment as well as House. Sarah Arokiaswamy, Deputy Director, SIRO & Programme
in practice also. Coordinator, apprised the participants about the structure and importance
S.N. Agarwal, Fellow Member informed the students that they of attending Training Orientation Programme. She advised the
have to keep in mind two things to be successful in their endeavor in participants to be punctual, comply with administrative formalities while
any area. Without hard & sustained labour, nothing can be achieved attending the training. On 12.1.2007 at the Valedictory Session of the
in life. Since they have decided to join the CS course, which is a right Training Orientation Programme Sarah Arokiaswamy, congratulated
decision, they should now pursue their studies with all sincerity to be the trainees on their successful completion of Training. She advised
successful in the shortest possible time. the participants to register with The ICSI for undergoing Management/
Vibha Mehrotra, Fellow Member informed the students and the faculty Apprenticeship Training. She also informed the trainees about various
members that they are free to contract for any type of problems and programmes and coaching sessions organized by SIRO for the benefit
suggestions if any for the improvement of the standard of Kanpur Chapter. of Company Secretaryship students and advised them to make use of
the same. The 10th TOP was attended by 14 participants.
Ajai Kumar Sharma ACS informed the students that the Chapter
has well equipped library, good faculty members and cooperative staff. BANGALORE CHAPTER
He advised them to become library member and suggest the CAREER AWARENESS PROGRAMME
Committee for purchase of new books. K.L. Kushwaha, Chapter official On 5.12.2006 the Chapter organised a Career Awareness
advised the students to refer to Student Company Secretary bulletin Programme at Aurobindo PU College, Shimoga. V Devendra, Acadamic
December 2006 regarding compulsory computer training scheme. On Director and Secretary, K Nagaraj, Principal, M Srikanth Hegde,
the occasion time table was also circulated among the students. Principal (High School) of Aurobindo PU College & High School were
SOUTHERN INDIA REGIONAL COUNCIL present during the programme. Over 200 students of Science,
Commerce and Arts streams attended the programme.
FOUNDATION/INTERMEDIATE COURSE ORAL P.K. Pande, Chairman, Oral Coaching and Students Facilities and
COACHING CLAS SES FOR DECEMBER 2007 Library Audit and Disposal Sub-Committee, Bangalore Chapter of the
EXAMINATIONS ICSI, explained in detail the course offered by the Institute and the
criteria for eligibility for the course, examination, requirements of training
The SIRC of the ICSI proposes to conduct Foundation/ etc. He also highlighted the importance of making the right career
Intermediate (Both Groups) Oral Coaching Classes for December choice so as to be successful in life. He then spoke about the role of a
2007 Examinations as per details given below : Company Secretary and importance of the profession of Company
Secretary in the changing economic scenario. He also highlighted the
State Date of Timing Fees Last date for opportunities available to anyone who has completed the Company
commence- receipt of Secretaryship course. He further enumerated the emerging areas of
ment application practice and the changing role of a Company Secretary. He also
Foundation 23.07.2007 9.00 A.M. Rs. 3000/- 16.07.2007 focused on what would be the mindset and preparation required from
(Morning) to a student who wanted to pursue the Company Secretaryship Course.
Pande also clarified the various doubts and issues those were raised
11.00 A.M.
by the participants and thanked the management for providing the
Foundation 23.07.2007 4.00 P.M. Rs. 3000/- 16.07.2007 Institute this opportunity. Brochures containing brief details of the
(Evening) to Company Secretaryship Course were distributed to the participants.
Intermediate 02.04.2007 6.30 A.M. Rs. 3350/- 26.03.2007 On 8.1.2007 the 23rd batch of Foundation Course and 41st batch of
Group-II to per group Intermediate Course Oral Coaching Classes of the Bangalore Chapter
(Morning) 8.30 A.M. was inaugurated at a Students Meet held at St. Joseph Indian High
School. Prof. J. Subramanian, Dean, Faculty of Commerce &
Intermediate 02.04.2007 6.00 P.M. Rs. 3350/- 26.03.2007
Management, Christ College, Bangalore was the Chief Guest who
Group-I to per group inaugurated the Oral Coaching Classes. In his address Prof.
(Evening) 8.00 P.M. Subramanian, focused on the importance of planned and systematic
For further details please contact: study and approaching the process of learning as a continuous process
SIRO of the ICSI, New No. 9, Wheat Crofts Road, and not merely an exam oriented one. He also emphasized that the
Nungambakkam, Channai-600034 fact that would ensure one in being effective would be how well one
Phone : (044) 28279898; 28268685 was conversant with the Law and especially the latest amendments
e-mail:; and their effect/implications. He cautioned the students to become a
true professional and not a professional of a profession and to be
COMMENCEMENT OF ORAL COACHING CLASSES solution providers and facilitator of business rather than being spoke
in the wheels of the plans of the Management. G.V. Srinivasa Murthy,
On 8.1.2007 the SIRO of the ICSI commenced Oral Coaching Secretary, Bangalore Chapter of the ICSI also addressed the students
Classes for Intermediate Group I (Morning) and Group II(Evening) for and emphasised on the importance of having the right attitude, hard
June 2007 examinations at ICSI-SIRC House, Chennai. work and reading.
The SIRO of the ICSI released a comprehensive write up about INAUGURATION OF ORAL COACHING CLASSES
the Company Secretaryship Course in a leading Tamil weekly Ananda
Vikatan in its issue dated 10.1.2007. The above weekly is having the On 30.1.2006 the Intermediate and Foundation Course Oral
largest circulation in Tamilnadu and it is having wide readership abroad Coaching Classes conducted by the Chapter was inaugurated at its
also. The SIRO has been receiving a number of letters from various premises. K.O. Kuriachan, Chairman inaugurated the Coaching
parts of interior Tamilnadu and also from adjoining states - Karnataka Classes. A.A. Varghese and A. Sivadasan, Managing Committee

Student Company Secretary 27 February 2007

News and Announcements
members addressed the gathering and explained about the importance provisions of section 173(2) of the Companies Act, 1956, minutes of
of the CS course as well as the future scope and opportunities. On board meeting, specimen minutes, specimen resolutions, resolution
the occasion, Rajesh the youngest member of the Institute from Kerala, for enhancement of authorized share capital, resolution for rights issue,
having passed the final course at the young age of 20 years was resolution for increase of remuneration of MD/WTD and resolution for
felicitated. Rajesh also addressed the students. The session was commencement of new business.
attended by a good number of students and parents. MEDITATION PROGRAMME
COIMBATORE CHAPTER On 26.1.2007 the Chapter organized a meditation programme for
INAUGURATION OF ORAL COACHING CLASSES students at its premises. The programme was conducted by Dr. Trilok
On 3.1.2007 the Chapter inaugurated the Oral Coaching Classes Kumar, after School Centre for Social Entrepreneurship, Bikaner. The
for the June 2007 session for Foundation, Intermediate Group-I & programme was attended by 40 students who stated that they were
Group-II. V.S.Subash, Practising Company Secretary, C.Subramaniam, immensely benefited by attending the programme.
Company Secretary, Shanti Gears Ltd., G.Vasudevan, Practising CAREER AWARENESS PROGRAMMES
Company Secretary and G.Balasubramaniam, Company Secretary, On 10.1.2007 the Chapter organized a Career Awareness
Roots Multi Clean Ltd., addressed the students on the importance of Programmes at Shyamala Devi Degree College for Women and on
Company Secretary in the Corporate Scenario and gave a detailed 23.1.2007 at Scholors Degree College, Hyderabad. R. Chandra Sekhar,
account of the course contents, training requirements, employment Executive Officer explained the importance and opportunities available
opportunities etc. for the company secretaries and advised the students to take up the
HYDERABAD CHAPTER course. Around 200 students participated in the above programme.
EXAMINATIONS On 14.1.2007 the Chapter organised a student meeting at its
From 9.4.2007 onwards fresh batch of Foundation/ seminar hall. T.R. Narayanan Nair, Chapter Chairman while addressing
Intermediate course Oral Coaching Classes will be conducted the students of the Chapter highlighted the role of the students in
by the Chapter for December 2007 examinations as per the reviving and vitalizing the Chapter. A good interaction took place
following schedule. between the Chairman and the students.
Timings : 06.30 P.M. to 08.30 P.M.
Venue : Sujatha Degree College for Women, Chapel Road, Abids, INAUGURATION OF INTERMEDIATE GROUP I ORAL
No. of Lectures : 150 lectures each of 2 hrs. duration On 4.1.2007 the Chapter inaugurated the Intermediate Group I
Intermediate Gr. I Oral Coaching Classes conducted by the Chapter. The batch of more
Timings : 07.00 A.M. to 09.00 A.M. than 100 students was inaugurated by Dr. Harish Oza, Head,
Fees : Rs. 2750/- Commerce Department, Gujarat University and Director School of
Venue : The ICSI-Hyderabad Chapter # 6-3-609/5, Anandnager Commerce, Gujarat University. Dr. Oza briefly explained the students
Colony, Khairatabad, Hyderabad-500 004 the importance of profession and methodology for preparation of
No. of Lectures : 96 lectures each of 2 hrs. duration professional examinations. Chirag Shah, Chapter Secretary also
Intermediate Gr. II explained the students the seriousness of the hour and importance of
Timings : 06.30 P.M. to 08.30 P.M. adoption of professional conduct towards professional studies.
Fees : Rs. 2750/- THANE CHAPTER
Venue : Sujatha Degree College for Women, Chapel Road, Abids,
No. of Lectures : 96 lectures each of 2 hrs. duration CLASSES
Intermediate Gr. I & II W.e.f. 2.7.2007 the Chapter intends to commence next batch
Timings : 09.15 A.M. to 01.30 P.M. of Oral Coaching Classes for Intermediate Group II students.
Fees : Rs. 4750/- (Both Groups) For further details contact the Chapter Office at 206, Swastik
Venue : The ICSI-Hyderabad Chapter # 6-3-609/5, Anandnager Plaza, 2nd Pohkran Rd (Subash Nagar), Prior to Voltas Ltd., Thane
Colony, Khairatabad, Hyderabad-500 004 (W) 400 601.Phone:25444479;e-mail:
No. of Lectures : 192 lectures each of 2 hrs. duration
Interested candidates are advised to deposit the fee by VADODARA CHAPTER
Challan at the Chapter Office by 5th April 2007. The students MEETING WITH STUDENTS
who undergo Oral Coaching, pass the Eligibility Tests and get
On 29.1.2007 the Chapter in its endeavor to provide best possible
the Coaching Completion Certificates, need not to submit the
services to the student community organized a meeting with the students
response sheets under postal tuition scheme. For further details
at its premises. The basic objective of the meeting was to get the feed
the students are advised to contact the Chapter at the above
back on the oral tuition classes which have started recently and also to
address. Telephone Nos. 040-23399541, 040-23396494. Fax :
get the pulse of students on any problem that they are facing relating to
040-23325458. E-mail:
their studentship and while undergoing Oral Tuition during the current
term. A large number of students attended the meeting and gave their
EIGHTH ACADEMIC DEVELOPMENT PROGRAMME candid feedback on the performance of the Oral Tuition Classes and
On 20.1.2007 the Chapter organized the 8th Academic Development also raised various queries on their studentship which were addressed
Programme on Drafting of Notices, Resolutions, Minutes etc. at its to their satisfaction. Students also gave various suggestions for improving
premises. B. Pavan Kumar, Company Secretary in Practice in his the students infrastructure at the Chapter including those for purchase
address explained drafting of minutes, resolutions and notices, pre- of new books, keeping the Chapter premises open on Holidays prior to
requisites of drafting, General principles of drafting. Use of appropriate examination, increase in duration of lectures and extra lectures etc. All
words and phrases, points to remember, provisions relating to notices, the suggestions were noted and assurance given that attempts shall be
resolutions &minutes, Notice Ordinary business, Notice-special made to provide them the best. Other than the students the managing
business, Notice-Explanatory Statement, Notice-Special resolution, committee members of the Chapter and WIRC representatives were
Specimen Notice of AGM, explanatory statement pursuant to the present during the interaction.
Student Company Secretary 28 February 2007
ELIGIBILITY OF PARTICIPANTS : ICSI final passed candidates. SMTP COURSE CONTENTS : Module I-Filling and Filing of Forms under
the Companies Act, 1956. G Module II-Practical and Procedural Aspects of Convening and Conducting Board Meetings & Annual General
Meetings and Related Aspects. G Module III-Managing Public Issues. G Module IV-Loan Documentation, Joint Ventures & Foreign
Collaborations, Raising Finance through EURO Issues & Export and Import Procedures and Documentation. G Module V-Practical and
Procedural Aspects relating to Appearance before CLB/Under SICA, Consumer Protection Act and Case Studies in RTP/UTP. In addition, the
participants would be exposed to case studies and mock board/general meeting, etc.
Organised by Dates & Duration Venue of Programme Contact Address
EIRC of 23.04.2007 EIRO Premises Executive Officer, EIRO of the ICSI, ICSI-EIRC Bldg., 3-A, Ahiripukur 1st
the ICSI to Lane, Near Beck Bagan Nursing Home, Kolkata-700019 Tel. : 22832973/
09.05.2007 22816541 Fax No. : 033-22816542 E-mail :
SIRC of 14.03.2007 SIRC Premises Deputy Director SIRC of the ICSI, SIRC-ICSI House No. 9, Wheat Crofts
the ICSI to Road, Nungambakkam, Chennai-600034 Tel. : 044-28279898/28268685
30.03.2007 Fax No. : 044-28268685 E-mail :
Bangalore 12.03.2007 Chapter Executive Officer & Programme Coordinator, Bangalore Chapter of the SIRC
Chapter of to Premises of the ICSI Sheriff Chambers, 3rd Floor, Rear Block, 14, Cunningham Road,
SIRC of the 29.03.2007 Bangalore-560 052 Tel. : 22286574/22287158 Fax No. : 22261861
ICSI (STD CODE : 080) E-mail :;
Hyderabad 10.04.2007 Chapter Programme Coordinator, Hyderabad Chapter of the SIRC of the ICSI
Chapter of to Premises # 6-3-609/5,Anand Nagar Colony, Khairatabad, Hyderabad-500004
SIRC of the 26.4.2007 Tel. : 23399541/23396494 Fax No. : 23325458 (STD CODE : 040)
ICSI E-mail :
CCRT of the 24.03.2007 CCRT Programme Coordinator, CCRT of the ICSI, Plot No. 101, Sector-15,
ICSI to Premises Institutional Area, CBD Belapur, Navi Mumbai-400614 Tel. : 022-27577814/
08.04.2007 15/16 Fax No. : 022-27574348 E-mail :,
(17th Residential
The schedule of other SMTPs proposed to be conducted by SIRC and Bangalore Chapter during 2007 is as under :
SIRC : (i) 18.07.07 to 03.08.07 (ii) 18.09.07 to 04.10.07. Bangalore Chapter : 10.09.07 to 27.09.07.


Every student of the Institute who has been sponsored for 15 months training either in a company or under a Company Secretary in Practice is
compulsorily required to attend and complete 25 Hours Academic Development Programme (ADP). The duration of each ADP would be eight hours
and those who have attended three such programmes would be deemed to have attended 25 Hours ADP.
Fee Rs. 250/- per participant
The Schedule of ADPs proposed to be organized by NIRC, SIRC & Hyderabad Chapter is as under :
Organised by Date Venue of the Contact Address
NIRC of 10.03.2007 NIRC Premises Executive Officer, NIRC of the ICSI, ICSI-NIRC Bldg., Plot No. 4, Prasad
the ICSI Nagar Institutional Area, New Delhi-110005 Tel. : 25763090/25767190/25816593
Fax No. : 25722662 (STD Code No. 011) E-mail :
SIRC of 16.05.2007 SIRC Premises Deputy Director SIRC of the ICSI, SIRC-ICSI House No. 9, Wheat Crofts
the ICSI Road, Nungambakkam, Chennai-600034 Tel. : 044-28279898/28268685
Fax No. : 044-28268685 E-mail :
Hyderabad 01.04.2007 Chapter Programme Coordinator, Hyderabad Chapter of the SIRC of the ICSI # 6-3-609/5,
Chapter of Premises Anand Nagar Colony, Khairatabad, Hyderabad-500004 Tel. : 23399541/
SIRC of the 23396494 Fax No. : 23325458 (STD CODE : 040) E-mail :
The schedule of other ADPs proposed to be organised by SIRC and Hyderabad Chapter during 2007 is as under :
SIRC : (i) 18.08.07 (ii) 15.11.07 Hyderabad Chapter : 13.05.07.

Attention Students! ATTENTION STUDENTS!

REVISION OF EXAMINATION FEE FROM DECEMBER, 2006 Fee Concession to Physically Handicapped
The Examination Fee stands revised from December, 2006 The Council of the Institute has decided to grant 50% concession in
session of examination as under : payment of Registration/Examination Fees by the candidates belonging to
Physically Challenged (including blindness) category with effect from 1st
1. Foundation Exam : Rs. 875 (Lumpsum) July 2006. For availing the aforesaid benefit, such applicants/students will
2. Intermediate Exam : Rs. 900 (Per Group) be required to submit a certificate issued by the Medical Supdt. of a State/
3. Final Exam : Rs. 750 (Per Group) Central Government Hospital to this effect.

Student Company Secretary 29 February 2007

LIST OF THE COMPANIES REGISTERED FOR Synthite Industrial Chemicals Limited 15 and 03 3000-
DECEMBER 2006 Cochin-682016 Practical
Region Training Stipend
Period (Rs.) Dynaspede Integrated Systems Pvt. Ltd. 15 Months 4000-
# 24, Krishnaswamy Nagar Training 6000
Northern Region
50 Feet Road, Coimbatore-641045
Spray Engineering Devices Limited 15 Months Suitable
Western Region
25, Industrial Area, Phase-II Training
Chandigarh-160002 Rohanna Agri Business Corporation 15 Months Suitable
Limited Training
Ludhiana Stock Exchange Limited 15 Months Suitable "Shrikrishna", Krishnakeval Nagar
Firoze Gandhi Market Training 1-A, Kondhwa Khurd, Pune-411048
Sintex Industries Limited 15 Months Suitable
eSys Information Technologies Ltd. 15 Months Suitable Kalol (N. Gujarat)-382721 Training
B-65, Okhla Industrial Area, Phase-I Training
New Delhi-110020 IL & FS Investmart Limited 15 Months Suitable
The IL & FS Financial Centre Training
Status Mark Finvest Limited 15 Months Suitable Plot No. C-22, G Block, Bandra-Kurla
1090/13, Hardhyan Singh Road, Training Complex, Bandra (East), Mumbai-400051
Karol Bagh, New Delhi-110005
Carol Infrastructure Pvt. Ltd. 15 Months 4000 LIST OF PRACTISING MEMBERS REGISTERED FOR
Landcraft Developers Pvt. Ltd. 15 Months 4000 2006
C-22, IIIrd Floor, RDC, Raj Nagar Training 1. LOKESH SHARMA PCSA-1430
Ghaziabad-201002 U.P. Hinger Market, Station Road, Kankroli Distt.
Allianz Securities Limited 15 Months 3000 Rajsamand-313324 (Rajasthan)
2nd Floor, 3, Scindia House Training 2. DEEPAK JAIN PCSA-1431
Janpath, New Delhi-110001 728, Navijivan Commercial Premises
Southern Region Co-Op. Soc. Ltd. Lamington Road,
Creamline Dairy Products Ltd. 15 Months Suitable Mumbai-400008
1-11-252/11/1, Motilal Nagar Training 3. DIPAK RENUKUMAR JOGI PCSA-1432
Begumpet, Hyderabad-500016 Tenement No. 7, Plot No. 180
Ward 4/B, Adipur-370205 (Kutch)

(Period from 01-01-2007 to 31-01-2007)
15 Months Training with Company/Company Secretary in Practice and 03 Months & 15 days Practical Training
Biodata of the students sent to the companies/company Students sponsored for training
secretaries in practice for consideration
Pending Received Forwarded for Pending Pending Received No. of students Pending
Training as on during the consideration as on as on during who have actually as on
Type 31.12.06 month (upto 31.01.07) 31.01.07 31.12.06 the month taken for training 31.01.07
(upto 31.01.07)
15 Months in 10 27 22 15 07 21 24 04
15 Months with NIL 06 06 NIL 05 27 25 07
CS in Practice
3 Months in NIL 38 38 NIL
15 Days in
Optional Area
2. Exemption
1. Number of applications pending as on 31.12.2006 : 18
2. Number of applications received for exemption : 07
3. Number of exemptions granted : 20
4. Number of pending applications as on 31.01.2007 : 05

Student Company Secretary 30 February 2007

Organised by Dates Venue of the Programme Contact Address
Bhubneswar 10.03.2007 Chapter Programme Coordinator/Office Incharge, Bhubaneswar Chapter of the EIRC
Chapter of to Premises of the ICSI, ICSI Bulding, Plot No. 70, VIP Colony, IRC Village,
EIRC of the 14.03.2007 Bhubaneshwer-751015 Tel. : 0674-2552282 (Mobile) : 9937004139
ICSI E-mail :
NIRC of 26.02.2007 NIRC Premises Executive Officer, NIRC of the ICSI, ICSI-NIRC Building, Plote No. 4,
the ICSI to Prasad Nagar, Institutional Area, New Delhi-110005 Tel. : 25763090/
02.03.07 25767190, 25816593 Fax : 25722662 (STD CODE : 011)
E-mail :
SIRC of 05.03.2007 SIRC Premises Deputy Director SIRC of the ICSI, SIRC-ICSI House No. 9, Wheat Crofts
the ICSI to Road, Nungambakkam, Chennai-600034 Tel. : 044-28279898/28268685
09.03.2007 Fax No. : 044-28268685 E-mail :
Bangalore 05.03.2007 Chapter Executive Officer & Programme Coordinator, Bangalore Chapter of the SIRC
Chapter of to Premises of the ICSI Sheriff Chambers, 3rd Floor, Rear Block, 14, Cunningham Road,
SIRC of the 09.03.2007 Bangallore-560 052 Tel. : 22286574/22287158 Fax No. : 22261861
ICSI (STD CODE : 080) E-mail :;
Hyderabad 06.03.2007 Chapter Programme Coordinator, Hyderabad Chapter of the SIRC of the ICSI
Chapter of to Premises # 6-3-609/5, Anand Nagar Colony, Khairatabad, Hyderabad-500004
SIRC of the 10.03.2007 Tel. : 23399541/23396494 Fax No. : 23325458 (STD CODE : 040)
ICSI E-mail :
The schedule of other TOPs proposed to be organised by SIRC and Bangalore Chapter during 2007 is as under :
SIRC : (i) 08.10.07 to 12.10.07 Bangalore Chapter : 03.09.07 to 07.09.07.


It has been observed that the students opting for
undergoing 15 months training with Company Secretaries
in whole-time Practice are submitting the Contract of
Apprenticeship and other relevant documents and
registration fees to the Institute after a considerable period
of time.
As per the Training Guidelines, the students should
submit the underlisted documents within 15 days from the
commencement of training to enable the institute to take
their training on record with effect from the date of execution
of Contract.
(i) Contract of Apprenticeship in duplicate on a non-judi-
cial stamp paper of requisite value as applicable to the
particular State, where the contract is executed.
The Contract should be executed by both the par-
ties viz., the trainee and the Company Secretary in
whole-time Practice.
(ii) Statement of Particulars to be submitted in duplicate
for registration as a trainee (Part A & B).
(iii) Rs. 50/- being the Registration Fee.
If the aforesaid documents/information is not received
within the stipulated time, the training shall not be taken on

Student Company Secretary 31 February 2007