Vote for nobody – A myth

Web: http://www.bombaybar.com

Over the last week, many of us have been inundated with emails encouraging us to “vote for nobody”, claiming, among other things, that this is a way of driving out electoral candidates. As our member, and Senior Advocate, Chander Uday Singh points out, this is a complete myth. Many thanks to Chander for this timely advice. A postscript has been contributed by Mr Parag Kabadi, of Doijode Associates. There is also a link to a fairly good article on Wikipedia, to the same effect. Please circulate and forward this widely.

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“Vote for Nobody”: A Myth
by Chander Uday Singh
Senior Advocate, Bombay High Court

This chain mail (one version is at the foot of this message) has been doing the rounds for some time now, but is based on a complete misunderstanding of the statutory provisions.

Neither the Consitution of India nor the Representation of the People Act, 1950 contain any provision to suggest that failure or refusal to vote can have any bearing on the outcome of an election at which other people have duly voted for the candidate of their choice. The provision in question, “49-O”, is actually a mere Rule which has been enacted in order to deal with a peculiarity of the electronic voting system which India pioneered.

“The Conduct of Election Rules, 1961” have been framed under the Representation of the People Act, 1950, and make detailed provisions for everything from filing of nomination papers to casting of votes, counting of votes, and the like. Separate provisions are made for direct elections such as to Parliament and State Assemblies, and for indirect voting such as in electoral colleges. Part IV of the Rules covers “Voting in Parliamentary and Assembly Constituencies”, while Part V covers “Counting of Votes in Parliamentary and Assembly Constituencies”. Part IV has two Chapters, with Chapter I (Rules 28 to 48) applying to “Voting by Ballot”, and Chapter II (Rules 49-A to 49-X), which was added in 1992 to deal with the new phenomenon of electronic voting, applying to “Voting by Electronic Voting Machines”.

Rule 49-O, which is part of Chapter II, has been introduced in order to account for all electors who have attended and signed into the polling station. In the case of voting by ballot, the actual number of ballot papers issued are required to be tallied with the votes cast in order to avoid any malpractice, and this account includes ballot papers which have been properly marked, ballot papers which have been accidentally torn/defaced, ballot papers which are seized from electors who refuse or fail to put them into the ballot boxes, and so on. Since ballot papers are physically verifiable and can be counted (whether from the ballot boxes or from sealed envelopes containing defaced/torn/misused ballot papers), there was no need prior to 1992 to have any special Rule to obtain the signature of an elector who attended the polling process but refused or failed to cast her/his vote.

However, when voting is done by electronic voting machines, there is no physical manifestation of the vote. Hence, all accounting has to be done by verification of the registers which are signed by the electors before going behind the screen and punching a button on the voting machine. There being no such thing as a blank or defaced or torn ballot, it became necessary to provide that if an elector, after coming to the polling station and signing in, refuses or declines to cast her/his vote, then a remark has to be made in the register and the signature/thumb impression of the elector has to be obtained against such remark. This remark/entry is then relied upon while counting votes under Rule 66-A, which is a special Rule for counting of votes cast in electronic voting machines, since the machine only records the votes actually cast, and has no means of knowing how many people signed in but failed/refused to cast their votes.

Rule 66-A read with Form 17-C make it clear that the purpose of Rule 49-O is only to ensure that electors who fail to vote ater signing into the pollking station have done so of their own accord and not due to any force or coercion. Form 17-A is the form in which the polling booth register is to be maintained, which is signed by all electors when they enter the polling booth and are identified against the list of valid voters at that booth. Form 17-C records the final count of votes as per Rule 66-A, and this has to be signed by the election agents of all the candidates as it reflects the final result of the tally. Column 6 of Form 17-C requires that the number of electors who actually cast their votes as per the voting machine, be added to the number of those who declined/refused to vote, i.e. those in respect of whom a remark is entered against their names in the voting register (Form 17-A) under Rule 49-O, and that the total of these two figures should tally with the total who signed the voter’s register. In case of any discrepancy in this total, the polling agents have to explain the discrepancy in Form 17-C. This is nothing but an accounting procedure devised in order to ensure that there is neither any bogus voting, nor any force used to prevent valid electors from casting their votes.

Importantly, there is nothing whatsoever in the Act or Rules to suggest that if electors either individually or collectively decline to cast their votes and get this fact recorded under Rule 49-O, then this would have any effect whatsoever on the election. Elections are won (or lost) on the basis of votes cast in favour of different candidates, and not on abstentions. The Greek definition of “idiot” remains as valid as ever, and Rule 49-O has done nothing to elevate a person who refuses to vote out of that category.

Parag Kabadi adds:

Although Rule 49 O provides that an elector may refuse to vote after he has been identified and necessary entries made in the Register of Electors and the marked copy of the electoral roll, the secrecy of voting is not protected inasmuch as the polling officials and the polling agents in the polling station get to know about the decision of such a voter.

The Election Commission has therefore recommended that the law should be amended to provide that in the ballot paper and the particulars on the ballot unit, in the column relating to names of candidates, after the entry relating to the last candidate, there should be a column, “None of the above”, to enable a voter to reject all the candidates, if he chooses so.

Such a proposal was earlier made by the Election Commission in December, 2001 and reiterated in July, 2004 (vide letter dated 10.12.2001). Text of the recommendations is available here.

Interestingly, nothing is provided in the Election Commission’s recommendations, regarding re-election or invalidation of the current candidates. If such a consequence is really provided it will be great, until then, as Chander indicated, don’t be an “idiot””!

See also: Wikipedia on Rule 49-O

Directory of law firms operating in India

Directory of firms operating in India

Source

• A V Dave & Associates/M/s Dave registration services in Bhavnagar and Ahmedabad

• A.R.A. LAW in Bangalore and Mumbai

• A.Y.Chitale & Associates in New Delhi

• ALMT Legal in Mumbai and Bangalore

• ARSS Legal in New Delhi, Mumbai, Kolkata, and Bangalore

• AZB & Partners in Mumbai, New Delhi, and Bangalore

• Abhay Ahuja & Associates in Mumbai

• Aditya Sondhi Law Chambers in Bangalore

• Advani & Co in Mumbai

• Advani & Co. in Pune and New Delhi

• Akash Chittranshi & Associates in New Delhi

• Amarchand & Mangaldas & Suresh A. Shroff & Co in Kolkata, Bangalore, Mumbai, New Delhi, Hyderabad, and Kolkata

• Amarjit & Associates in New Delhi

• Anand and Anand in New Delhi and Mumbai

• Apurva Vakil in Ahmedabad

• Archer & Angel in New Delhi

• Ashurst LLP in New Delhi

• Asia Trademark Ltd in New Delhi

• Associated Law Advisers in New Delhi

• Bajla, Iyer & Associates, Advocates in Mumbai

• Bhasin & Co in Mumbai and New Delhi

• Bhatt & Saldanha in Mumbai

• Bimal B. Bhaskar, Advocate, Corporate Lawyer in Hyderabad

• Chadha & Chadha in New Delhi

• Chandrakant M. Joshi in Mumbai

• Crawford Bayley & Co in Mumbai

• Crestlaw Partners in Bangalore

• D H Law Associates in Mumbai

• D P Ahuja & Co in Bangalore, New Delhi, Chennai, and Kolkata

• DM Harish & Co in Mumbai

• DSK Legal in New Delhi and Mumbai

• Daniel and Gladys in Chennai

• Daulet-Singh & Associates in New Delhi

• Dave & Girish & Co in Mumbai and Bangalore

• De Penning & De Penning in Chennai and Mumbai

• DeHeng Law Office in New Delhi

• Desai & Chinoy in Mumbai

• Desai & Diwanji in Bombay

• Dhir & Dhir Associates in New Delhi

• Dua Associates in New Delhi, Bangalore, and Mumbai

• Dubey & Partners in New Delhi

• Dutt Menon Dunmorr Sett in Bhubaneshwar, New Delhi, and Mumbai

• Economic Laws Practice in New Delhi and Mumbai

• Federal & Rashmikant in Mumbai

• Fox Mandal Little in Mumbai, Hyderabad, Chennai, Chandigarh, Bhubaneswar, Bangalore,Kolkata, Mumbai, New Delhi, Cochin, and New Delhi

• Gagrats in Mumbai and New Delhi

• Gandhi & Associates in Mumbai

• General Law Partners in Hyderabad

• Global Business Solutions in Chennai

• Gopakumar Nair Associates (GNA) in Mumbai

• H. K. Acharya & Company in Ahmedabad

• HSB Partners in Chennai

• Haresh Jagtiani & Associates in Mumbai

• Hariani & Co in Mumbai

• Hemant Sahai Associates – Advocates in Goa, Bangalore, Mumbai, and New Delhi

• Holla & Holla in Bangalore

• India Juris in New Delhi

• India Law Services in Bangalore and Mumbai

• IndoJuris Law Offices in New Delhi, Chennai, and Bangalore

• Indus G&D Law in New Delhi and Bangalore

• Iyer & Thomas Advocates in Chennai

• J Sagar Associates in New Delhi, Hyderabad, Mumbai, and Bangalore

• JM Sharma & Co in New Delhi

• Jafa & Javali in New Delhi

• Jehangir Gulabbhai & Bilimoria & Daruwalla in Mumbai

• Juris Corp in Mumbai

• K & S Partners in New Delhi and Bangalore

• K R Chawla & Co in Bangalore

• K. R. Chawla in New Delhi

• KSB Partners in Haryana

• Kachwaha & Partners in Chennai and New Delhi

• Kainth & Associates in Bangalore

• Kanga & Co in Mumbai

• Karanjawala and Company in New Delhi

• Kelley Drye & Warren LLP in Mumbai

• Kesar Dass B. & Associates in New Delhi

• Khaitan & Co. in Bangalore, Kolkata, New Delhi, and Mumbai

• King & Partridge Advocates in Madurai and Chennai

• King, Stubb & Kasiva in New Delhi, Chennai, and Bangalore

• Kochhar & Co in Bangalore, Chennai, Mumbai, and New Delhi

• Koura & Company in New Delhi

• Kris & Kolloth in New Delhi and Bangalore

• Krishna & Saurastri in Mumbai and Bangalore

• Krishnamurthy and Co in Bangalore

• L P Agarwalla & Co in Kolkata

• Lakshmikumaran & Sridharan in New Delhi

• Lall & Sethi Advocates in New Delhi, Bangalore, and Mumbai

• Lall Lahiri & Salhotra in Gurgaon

• Lex Nexus Advocates & Solicitors in Mumbai, Mumbai, and New Delhi

• Lexindia in New Delhi

• Lexygen in Bangalore

• Link Legal in New Delhi

• Luthra & Luthra in New Delhi, Bangalore, and Mumbai

• M Dhruva & Co in Mumbai

• M S Oberoi & Co in New Delhi

• MD&T Partners in Bangalore

• Majmudar & Co in Bangalore and Mumbai

• Mallar Law Consulting in Mumbai

• Manilal Kher Ambalal & Co in Mumbai

• Mars & Partners in New Delhi

• Mason & Associates in New Delhi

• Mehta & Mehta Associates in Gurgaon

• Mkono & Co in Bombay

• Mulla & Mulla & Craigie Blunt & Caroe in Bangalore and Mumbai

• NDLO South in Haryana

• Nanavati Associates in Ahmedabad

• Narasappa, Doraswamy & Raja in Bangalore

• Nishith Desai Associates in Bangalore and Mumbai

• O.P. Khaitan & Co. Solicitors and Advocates in New Delhi

• Obhan & Associates in New Delhi

• Office Of Parasaran in Chennai

• P & A Law Offices in Mumbai and New Delhi

• P H Parekh & Co in New Delhi

• PSA Legal Counsellors in New Delhi

• Paras Kuhad & Associates in Jaipur, Jodhpur, Mumbai, Ahmedabad, New Delhi, Kolkata,Pune, and Chennai

• Parker & Parker Company in Ahmedabad

• Pavan Duggal Associates Advocates in New Delhi

• Poovayya & Co in Bangalore and New Delhi

• Preconcept in Noida

• Premnath Rai Associates in New Delhi

• Puthran & Associates in Chennai

• R Ginodia & Co in Kolkata

• R Murari, Advocate in Chennai

• R. Subrahmanyam & Associates in Chennai

• Radhakrishnan & Company in Cochin

• Rajani Associates, Advocates & Solicitors in Mumbai

• Rajinder Narain & Co in Mumbai and New Delhi

• Ranjan & Narula Associates in Gurgaon

• Remfry & Sagar in Gurgaon

• S Jalan & Company in Kolkata and New Delhi

• S Majumdar & Co in Kolkata and Mumbai

• S&R Associates in New Delhi

• S. Venkateshwaran in Mumbai

• S.K. Tulsiyan & Co in Kolkata and Mumbai

• S.N. Gupta & Co in New Delhi and Mumbai

• SKS Law Associates in Haryana and New Delhi

• Saikrishna & Associates in Noida

• Sandersons & Morgans in Kolkata

• Seth Dua & Associates in Bangalore and New Delhi

• Sewak and Associates in New Delhi

• Sharma & Sharma in New Delhi

• Sibal and Eradi in New Delhi

• Singh & Associates in New Delhi

• Singhania & Co in Mumbai, Hyderabad, Chennai, Kolkata, Bangalore, New Delhi, and Chandigarh

• Singhania & Partners in Mumbai, Mumbai, Hyderabad, New Delhi, and Bangalore

• Singhi & Co in Ahmedabad

• Sinha & Company, Advocates in Kolkata

• Solomon & Co. in Mumbai

• Suman Khaitan & Co in New Delhi

• Sunil Kansal & Associates in Mumbai and New Delhi

• Surana & Surana International Attorneys in Chennai

• Swarup & Company in New Delhi

• Talwar Thakore & Associates in Mumbai

• Thakker & Thakker in Bangalore, New Delhi, Mumbai, and Hyderabad

• Thiru & Thiru in Hyderabad, Chennai, and Bangalore

• Thomas & Krishnaswami Law Associates in Chennai

• Titus & Co in New Delhi

• Trilegal in Andhra Pradesh, Mumbai, Bangalore, and New Delhi

• Tuli & Co in Mumbai and New Delhi

• Tyabji Dayabhai in Mumbai

• Udwadia & Udeshi in Bangalore and Mumbai

• V J Mathew & Co in Cochin, Coimbatore, Bangalore, New Delhi, Tuticorin, and Chennai

• VNS Legal in Chennai

• Vaish Associates in New Delhi and Mumbai

• Victor Moses & Co in Kolkata

• Vigil Juris in Mumbai

• Viswanathan & Co in New Delhi

• W.S. Kane and Co/Law & Prudence in Mumbai

• Wadia Ghandy & Co in Mumbai, Pune, Ahmedabad, Bangalore and New Delhi

• White & Case LLP Liaison Office in Mumbai

Do a Ctrl + F to find the law firm you are looking for.

This is not a complete list and there are several firms who have offices at places other than those mentioned above.

Taxation in IPR

“The Indian economy is overheated” says the Finance Minister. This comes as a prologue to the fact that the Government of India is bringing more and more sources under the taxation net or is tweaking the existing laws to levy taxes on a number of items/services/incomes, etc. This is being done through changes to existing laws or introduction of new sections in various acts like the Income Tax Act, Central Sales Tax Act, Value Added Tax Act, Profession Tax Act, Service Tax Act, etc. So in such a situation how can an upcoming sector like Intellectual Property Rights (IPR) be left out of purview of taxation?

Under the Intellectual Property Rights, the person assigning his rights to someone else earns an income in the form of Royalty. A person may also totally sell off his “trademark”, “patent”, “design” or “copyright” for a consideration.

TAXATION AND IPR –

1. Service Tax & IPR –

With effect from September 10, intellectual property services (other than copyrights) have been brought under the service tax net. According to the Revenue Department the definition of taxable services includes only such IPRs (except copyright) that are prescribed under law for the time being in force.

The Finance Ministry is of the view that the IPRs esp. Integrated circuits/undisclosed information would not be covered under the Taxable Services as these rights are not covered or prescribed under Indian Law.

Whether Payment of Royalty is a service ?

Payment of Royalty is not a service. It is rather a profit of the owner for permitting another to use his property. Hence payment of royalty should not be treated as a payment for service. IPR is in nature of property and the right to use IPR is a transaction in property and not consultancy or advice

Service Tax and Permanent transfer of IPR –

It has also been made clear by the Revenue Department that IPRs covered under Indian law in force at present alone, are chargeable to service tax. Further, permanent transfer of IPRs would not attract Service Tax because such transfer does not amount to rendering of service.

In cases where cess is levied under the Research and Development Cess Act, the Department has held that the cess amount so paid would be deductible from the total service tax payable.

Temporary transfer or permission to use or enjoy IPR can be classified as transfer of right to use goods, as it involves transfer of right to use movable property. Therefore, a tax on IPR is in pith and substance a tax on transfer of right to use IPR and not a tax on services.

Income Tax and IPR –

Earlier there was a lot of confusion over the provisions of Income Tax Act relating to Income Tax Act. However, over a period of time, various decisions given by the Tribunals, High Courts and Hon’ble Supreme Court and amendments to the Income Tax Act, the picture is quite clear now regarding transactions in IPR and its effect from Income Tax point of view

Purchase of Copyright – Capital or Revenue Expenditure –

Purchase of (c) is capital expenditure. Price paid for purchasing copyright of a book publisher and seller of books is capital expenditure – Hira Lal Phoolchand Vs. CIT [1947] 15 ITR 205 (All.)

Royalty for user of Trademark –
Royalty paid by the assessee for user of TM of another company is allowable as revenue expenditure. (CIT Vs. Raipur Manufacturing CO. [1996] 132 CTR (Guj.) 63

Expenditure on registration of Trademark –

Expenditure on registration of TM is not capital expenditure – The advantages derived by the owner of the TM by registration falls within the class of maintenance of the capital asset. The fact that a TM after regis. could be separately assigned and not as a part of the goodwill of the business only, does not also make the expenditure for registration a capital expenditure – CIT v. Finlay Mills Ltd. [1951] 20 ITR 475 (SC).

Deduction in repect of expenditure on acquisition of Patent –

As the term patent defined under the Patents Act 1970, only inventions can be patented and Beedi rolling or manufacturing, being not an invention, cannot be patented nor any patent right can be created therein. Therefore deduction cannot be claimed of expenditure on acquisition of patent or (c) in Beedi rolling or manufacturing in terms of Section 35A – CIT Vs. Mangalore Ganesh Beedi Works [2003] 128 Taxman 351/264 ITR 142 (Kar.).

Deductions U/s. 80O if the Income Tax Act –

From assessment year 2005 – 2006 and onwards no deduction shall be allowable in respect of income/royalty received from foreign enterprises in consideration for use outside India of any patent, invention, design or registered Trademark.

Conclusion –

Intellectual property laws in India are amongst the best in the world. The real problem is the implementation–the enforcement machinery is inadequate and the judicial process is slow.

So to improve this scenario, India will require great deal of political will, intellectual skill and administrative drill.

What is Sub Prime Lending

Meaning –

As the word “Sub” itself suggests -“less than ideal“.

The term “subprime” refers to the credit status of the borrower, which is being less than ideal. Subprime lending is a general term that refers to the practice of making loans to borrowers who do not qualify for the best market interest rates because of their deficient credit history.

Why the risk –

Subprime lending is risky for both lenders and borrowers due to the combination of high interest rates, poor credit history, and adverse financial situations usually associated with subprime applicants.

Sub Prime Borrowers –

The sub prime borrowers have a weak credit history which includes – charge offs, payment delinquencies, bankruptcies, low debt to income ratio, etc.

Why the crises –

Subprime lending refers to the practice of offering loans to people who do not qualify for the normal loans. When it comes to approving a loan, banks take into account the repaying capacity of the borrower and his credit history. If a person is not credit worthy or is a defaulter elsewhere, he cannot be given a normal “prime loan”. So as to target such persons, banks came up with a novel idea of “sub prime lending”.

Here the risk is more for the bank. So to set off the higher risk, banks commanding a higher risk premium and hence the interest rate is also higher. As a result of higher interest rates, banks could earn more money then what they would have normally got if they had gone for “prime lending”.

The subprime lending crisis began with a series of defaults by borrowers who were offered loans at higher interest rates because of their lower repayment capacity. First of all, the borrowers who were offered subprime mortgages had a poor credit history and then the higher interest rates charged only increased the burden on these borrowers and made it tougher for them to honour their mortgages, even if they had the intention to do so. This caused a series of defaults which is now commonly known as the subprime mortgage lending crisis.

Types –

Subprime mortgages and Sub Prime Credit Cards

Essay Sarbanes Oxley Act

Sarbanes-Oxley Act of 2002 is also known as the Public Company Accounting Reform and Investor Protection Act of 2002 and commonly called SOX or Sarbox.

The act is called as Sarbanes-Oxley Act after sponsors Senator Paul Sarbanes and Representative Michael G. Oxley.

Reason behind the enactment –

Number of major corporate and accounting scandals which rocked the United States prompted the House to enact the law.The confidence of general public in the United States’ securities market was shaken after the Enron, Peregrine System, Tyco Adelphia, Worldcom scandals. Not only these scandals cost the public billions of dollars but also negatively affected their faith in the United States Security Market.

Scope –

The legislation establishes new or enhanced standards for all U.S. public company boards, management, and public accounting firms. It does not apply to privately held companies.

The Act –

The Act contains 11 titles, or sections, ranging from additional Corporate Board responsibilities to criminal penalties, and requires the Securities and Exchange Commission (SEC) to implement rulings on requirements to comply with the new law.

The Act establishes a new quasi-public agency, the Public Company Accounting Oversight Board, or PCAOB, which is charged with overseeing, regulating, inspecting, and disciplining accounting firms in their roles as auditors of public companies. The Act also covers issues such as auditor independence, corporate governance, internal control assessment, and enhanced financial disclosure.

However, there is a heated debate on whether the benefits are comparable to the cost incurred in the implementation of the Act. Some feel that the legislation is necessary and will definitely help restoring public confidence in nation’s capital market, will help control the corporate accouting and strengthen the accounting creditibility of public accounting firms and others.

The Detractors contend that SOX was an unnecessary and costly government intrusion into corporate management that places U.S. corporations at a competitive disadvantage vis-a-vis foreign firms.

The effect of SOX on non-US companies –

It is being argued that with a legislation like Sarbanes Oxley, business will shift from US to other countries where there is lesser interference by Authority.

SOX’s effect on Non US cross listed Companies will be different depending on where such companies come from. If a company comes from a well regulated country, SOX will unnecessarily increase cost as such companies already comply with strict norms in their home country.

But Companies from not so well regulated countries will benefit as such companies will have to comply with requirements under the act and in turn which will enhance their creditibility and rating due to compliance of the act. But one must keep in mind that it is going to be too expensive for all companies to comply with the provisions of SOX.

Impact of SOX on the corporate IT department

The five areas and their impacts for the IT Department are as follows:

Risk Assessment – Before the necessary controls are implemented, IT management must assess and understand the areas of risk affecting the completeness and validity of the financial reports. They must examine how the company’s systems are being used and the current level and accuracy of existing documentation.

Control Environment – environment factors include the integrity, ethical values and competence of the entity’s people; management’s philosophy and operating style; the way management assigns authority and responsibility, and organizes and develops its people; and the attention and direction provided by the board of directors.

Control Activities – Control activities are the policies and procedures that help ensure management directives are carried out. They help ensure that necessary actions are taken to address risks to achievement of the entity’s objectives. Control activities occur throughout the organization, at all levels and in all functions. They include a range of activities as diverse as approvals, authorizations, verifications, reconciliations, reviews of operating performance, security of assets and segregation of duties. In an IT environment, control activities typically include IT general controls — such as controls over program changes, access to programs, computer operations — and application controls.

Monitoring – Auditing processes and schedules should be developed to address the high-risk areas within the IT organization. IT personnel should perform frequent internal audits. In addition, personnel from outside the IT organization should perform audits on a schedule that is appropriate to the level of risk. Management should clearly understand and be held responsible for the outcome of these audits.

Information and Communication – Without timely, accurate information, it will be difficult for IT management to proactively identify and address areas of risk. They will be unable to react to issues as they occur. IT management must demonstrate to company management an understanding of what needs to be done to comply with Sarbanes-Oxley and how to get there.

The Act

This article has been written from inputs gathered from different sources available on the Internet and in Print Media.

What is a Future Contract?

Let us start with Futures –

What is a futures contract?

Futures contract means an agreement to buy or sell the underlying security on a future date. Such agreements are legally binding in nature.

Specifications regarding the delivery, time and place of settlement, quantity, quality in case of commodities are decided beforehand in the contract itself. Futures can be settled by delivery of the underlying security – cash or asset as the case may be. E.g: In case of a commodity – by delivery of that commodity on which contract was made.

The date decided beforehand for settlement on which contract expires is called as “the expiry date of the contract”.

Cash settlement means paying or receiving the difference between the price at which the contract was entered and the price of the underlying asset at the time of expiry of the contract.

As a result, a person may face profit or loss depending on the difference of price between period as mentioned above.

Persons exempt from Payment of Profession Tax

Exemption from payment of Profession Tax –

Following classes of persons are exempted from payment of Profession Tax –

  1. Members of the forces as defined in the Army Act, 1950 or the Air Force Act, 1950 and the Navy Act, 1957 including members of auxillary forces or reservists, serving in the state.
  2. The badli workers in the textile industry.
  3. Any person suffering from a permanent physical disability (including blindness)
  4. Women exclusively engaged as agent under the Mahila Pradhan Kshetriya Bachat Yojna or Director of Small Savings.
  5. Parents or guardian of any person who is suffering from mental retardation
  6. Persons who have completed the age of 65 years (w.e.f. 1.4.1995)
  7. Parents or guardians of a child suffering from a physical disability as specified in clause (C) w.e.f 1.10.1996


So, in case you are above 65 years of age, contact your Profession Tax office alongwith an application stating that you are above 65 years of age & carry a proof of your age- ex: Pan Card or Voter’s ID card.

In the store- It is heard that 01/04/2008 onwards, Profession tax office will be handling Service tax as well!

Types of Mortgages in India

Type of Mortgages in India

Definitions –

Sec. 58 of the Transfer of Property Act, 1882 defines mortgage as –

A mortgage is the transfer of an interest in specific immoveable property for the purpose of securing the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability.

The transferor is called a mortgagor, the transferee a mortgagee; the principal money and interest of which payment is secured for the time being are called the mortgage-money, and the instrument (if any) by which the transfer is effected is called a mortgage-deed.

Types of Mortgages –

1. Simple Mortgage
2. Mortgage by Conditional Sale
3. Usufructuary Mortgage
4. English Mortgage
5. Mortgage by deposit of title of deeds
6. Anomalous mortgage

1. Simple Mortgage –

In a Simple mortgage, the possession of the mortgaged property is not transferred from mortgagor to the mortgagee.

If the mortgagor fails to repay the loan, the mortgagee has the right to sell the property and recover the loan from the sale amount.

2. Mortgage by Conditional Sale –

Under such Mortgage, the mortgagor apparently sells the property to the mortgagee on certain conditions –

1.On failure to repay the mortgage money before a certain date the sale shall become absolute,or
2.On condition that on such repayment of mortgage money the sale shall become invalid,or
3.On condition that on such repayment the mortgagee shall retransfer the property.

In such case, the mortgagee is a “mortgagee by conditional sale”.

3. Usufructuary Mortgage –

In a usufructuary Mortgage, the possession of the mortgaged property is transferred to the mortgagee. The mortgagee receives the income from the property (rent, profit, interest, etc) until the repayment of the loan. The title deeds remain with the owner.

4. English Mortgage –

In an English Mortgage –

1.The mortgagor binds himself to repay the borrowed money on a certain date.
2.The mortgagor transfers the property absolutely to the mortgagee.
3.But such transfer is subject to the condition that the mortgagee will retransfer the property on repayment before the agreed date.

5. Mortgage by deposit of title of deeds –
In such mortgage, the mortgagor delivers the title document of the property to the mortgagee with an intention to create a security thereon. Such mortgage is valid in towns of Kolkatta, Mumbai and any other town as the State Government may notify by publication in Official Gazatte

6. Anomalous mortgage –

Anomalous mortgage is a combination of different types of mortgages.

In the US, concept of Reverse Mortgage is fast catching up –

Meaning – A reverse mortgage loan is a loan where the lender pays the monthly installments to you instead of you making any payments to the lender. Hence the name reverse mortgage, as the payment stream is reversed. A Reverse mortgage enables senior citizens to convert their home equity into tax-free income. Reverse mortgages enable eligible homeowners to access the money they have built up as equity in their homes. They are primarily designed to strengthen seniors’ personal and financial independence by providing funds without a monthly payment burden during their lifetime in their home.

IMP. NOTE –

The security in a mortgage is immovable property while in a pledge it is movable property.