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Information on Indian companies
The Probe Newsletter February 2021

Universe of Registered Companies

  • As of Jan-2021, there were 22,30,547 companies incorporated out of which 13,17,832 are active.
  • 21.3% companies were incorporated after CY2018.
  • There are 7,941 active companies in Chandigarh city.
  • The chart does not include LLPs.

Company Classification

  • There are 11,295 active foreign companies in India.
  • 269 companies in India has unlimited liabilities.
  • 23,031 companies are not for profit company in India.

Probe New Company and LLP Incorporations Index

  • The Probe New Company and LLP Incorporations ( PNCLI) Index was constructed using Dec-00 as the base year.
  • In Jan-21, index value stood at 567 with 178,761 companies registered in the last 12 months.
  • 88,472 companies were incorporated in last 6 months.

New Company Incorporations

  • In Jan-21, 10,924 companies were incorporated of which 10,681 are private and 243 are public.
  • During the month of Jan-21, 795 companies were registered in Karnataka state.
  • 2,375 companies were registered under manufacturing business in Jan-21.

Company Incorporations – State-wise data

  • 1,057 companies incorporated in Uttar Pradesh which accounted 9.7% of total incorporation.
  • In Jan-21, 1,343 companies were incorporated in RoC Mumbai.
  • During the month of Jan-21, 5.2% of total companies were registered in Haryana state.

LLP Incorporations State-wise data

  • During the month of Jan-21, 3,293 LLPs were incorporated in India.
  • Gujarat stood at the 2nd position with 359 new LLP incorporation.
  • 638 LLP were incorporated under the trading business.

Nationwide Spread

  • There are 1,30,967 active companies which constituted 9.9% of total active companies.
  • 4,159 active company in Delhi are not for profit company.
  • As of Jan-21, Tamil Nadu has 86,543 active companies.

Statewide Spread – Karnataka

  • As of Jan-21, there are 88,310 active companies in Karnataka out of which 81.0% incorporated in Bengaluru city.
  • 2,665 companies are registered in Mysuru city.
  • There are 199 listed companies in Karnataka.

Paid Up Capital

  • 7,03,814 companies has paid up capital of upto Rs 1 lac.
  • As of Jan-21, 382 companies in Pune has paid up capital of more than Rs 25 cr.
  • 14% of the total active companies has paid up capital between Rs 1 – 5 lac.

Directorship Overview

  • As of Jan-21, there are 22,30,303 active directors
    in India.
  • Till Jan-21, there are 59,629 active foreign directors in India.
  • Gujarat has 1,47,233 active directors which constituted 6.6% of total directors.
RBI circular on Introduction of Legal Entity Identifier for Large Value Transactions

The Reserve Bank of India (“RBI”) on 05th January 2021 issued a circular introducing the Legal Entity Identifier (LEI), which is a 20-digit number used to uniquely identify parties to financial transactions worldwide.

RBI has decided to introduce the LEI system for all payment transactions of value of Rs.50 crore and above undertaken by entities (non-individuals) using the Central Processing System run by RBI – Real Time Gross Settlement (RTGS) and National Electronic Funds Transfer (NEFT).

Member Banks who participate in RTGS and NEFT and who undertake large value transactions of Rs.50 crore and above, have been advised to:

  • obtain the LEI in time, if they don’t already have one;
  • include remitter and beneficiary LEI information in RTGS and NEFT payment messages;
  • maintain records of all transactions of Rs.50 crore and above through RTGS and/or NEFT.

Entities can obtain LEI from any of the Local Operating Units accredited by the Global Legal Entity Identifier Foundation, which is the body tasked to support the implementation and use of LEI. In India, LEI can be obtained from Legal Entity Identifier India Ltd. (LEIL) (https://www.ccilindia-lei.co.in), which is also recognised as an issuer of LEI by the Reserve Bank under the Payment and Settlement Systems Act, 2007.

To read the full RBI circular, please click on the link.

The Probe Newsletter December 2020

Universe of Registered Companies

  • As of Nov-20, there are 22,03,735 companies registered in India out of which 12,93,006 companies are active.
  • Currently, there are 24,051 active companies in the state of Andhra Pradesh.
  • 19.7% of total active companies were incorporated after CY2018.
  • The chart does not include LLPs.

Company Classification

  • Presently, there are 11,62,689 private ltd companies in India.
  • 741 companies are incorporated under the guarantee & association.
  • There are 2,002 government company in India.

Probe New Company and LLP Incorporations Index

  • The Probe New Company and LLP Incorporations (PNCLI) Index was constructed using Dec-00 as the base year.
  • In Nov-20, index value stood at 561 with 139,784 companies and 36,886 LLP registered in the last 12 months.
  • In the last 6 months, 90,631 companies were incorporated in India.

New Company Incorporations

  • In Nov-20, 13,453 companies were registered out of which 13,154 were private and 299 were public.
  • 768 OPC (One Person Company) were incorporated in India in Nov-20.
  • During the month of Nov-20, 1,622 companies were incorporated under the trading business.

Company Incorporations – State-wise data

  • 628 companies were incorporated in the state of Haryana in Nov-20.
  • In Nov-20, 477 companies were registered under the finance business.
  • In RoC Ahmedabad, 645 companies were registered in Nov-20.

LLP Incorporations State-wise data

  • During the month of Nov-20, 3,793 LLPs were incorporated in India.
  • New LLP registration witnessed decline by 22.5% when compare to Oct-20.
  • Gujarat with 428 registration stood at 2nd position in terms of LLP registration in Nov-20.

Nationwide Spread

  • Till Nov-20, there are 1,29,687 active companies in West Bengal which constituted 10.0% of total active companies.
  • 69,580 companies are active in Gujarat state.
  • As of Nov-20, 6,813 companies are listed in India.

Statewide Spread – Uttar Pradesh

  • As of Nov-20, there are 89,861 active companies in Uttar Pradesh.
  • Noida has 13,559 active companies which accounted 15.1% of the total active companies in the state.
  • 260 companies the Uttar Pradesh has paid up capital of more than Rs 2 cr.

Paid Up Capital

  • Currently, there are 6,85,367 active companies with upto Rs 1 lac paid up capital.
  • Mumbai has 2,313 companies with paid up capital more than Rs 2 cr.
  • 9.0% active companies have paid up capital between Rs 15-50 lac.

Directorship Overview

  • Currently, there are 22,56,126 active directors in India.
  • Till Nov-20. There are 62,101 active foreign directors in India.
  • There are 1,50,498 active directors in the state of Karnataka.
RBI circular on Opening Current Bank Account

The Reserve Bank of India (“RBI”) on 14th December 2020 issued a circular directed to all Scheduled Commercial Banks and Payments Banks (and applicable to these banks only) wherein the RBI has issued a list of bank accounts which can be opened without any restrictions as was outline in the RBI circular dated 06th August 2020. The link to the circular is – https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=11945&Mode=0

The list of such bank accounts shall be as follows:

  • Accounts for real estate projects mandated under the Real Estate (Regulation and Development) Act, 2016 for the purpose of maintaining 70% of advance payments collected from the home buyers.
  • Nodal or Escrow accounts of payment aggregators/prepaid payment instrument issuers for specific activities as permitted by Department of Payments and Settlement Systems (DPSS), Reserve Bank of India under Payment and Settlement Systems Act, 2007.
  • Accounts for settlement of dues related to debit card/ATM card/credit card issuers/acquirers.
  • Accounts permitted under FEMA, 1999.
  • Accounts for the purpose of IPO/NFO/FPO/share buyback/dividend payment/issuance of commercial papers/allotment of debentures/gratuity etc., which are mandated by respective statutes or regulators and are meant for specific/limited transactions only.
  • Accounts for payment of taxes, duties, statutory dues etc., opened with banks authorized to collect the same, for borrowers of such banks which are not authorized to collect such taxes, duties, statutory dues, etc.
  • Accounts of White Label ATM Operators and their agents for sourcing of currency.

These restriction free permissions shall be subject to the condition that the accounts are used for the permitted or specified transactions only.

Banks shall need to flag these accounts in the CBS for easy monitoring. Banks have also been advised to monitor all current accounts and CC/ODs regularly, at least on a half-yearly basis to ensure compliance with the instructions given in this regard in the RBI circular dated 06th August 2020, link to which is provided above in this article.

RBI has clarified a few Frequently Asked Questions in this regard, a few of which are as follows:

  • Banks shall no longer be required to obtain No Objection Certificate (NOC) as was advised earlier.
  • Banks may compute the aggregate exposure for the purpose of these guidelines based on the information available from Central Repository of Information on Large Credits, Credit Information Companies, National E-Governance Services Ltd. etc., and by obtaining customers’ declaration, if required.
  • All fund based and non-fund based credit facilities sanctioned by the banks and carried in their Indian books shall be included for the purpose of aggregate exposure.
  • The revised guidelines are applicable to all borrowers, not just entities as was the case with previous guidelines on obtaining NOC.
  • Banks are not permitted to open current accounts for borrowers who have availed any fund or non-fund-based credit in the form of overdraft facilities.
  • In case of proprietary firms, the aggregate exposure shall include all the credit facilities availed by him/her, for business purpose or otherwise.
  • In case bank’s exposure to the borrower is less than 10%, funds may be remitted to the account maintained with the bank having the highest share in the exposure of the banking system to the borrower. Credits and debits will be freely permitted in the said account. Alternatively, the borrower is free to avail working capital only in the form of WCDL/WCTL and open current accounts as per the provisions of paragraph 1(v) of the circular based on the aggregate exposure.
  • Banks may open a current account for receiving/monitoring cash flows of a specific project, provided the borrower has not availed any CC/OD facility for that specific project. Banks opening project specific current/escrow account shall ensure that cash flows coming in the account are from that project only.
  • Banks are free to open current accounts for borrowers having credit facilities only from NBFCs/FIs/Co-operative banks/Non-bank institutions. However, if such borrowers avail facilities from the banks covered under the guidelines, all the provisions of the circular shall be applicable.
  • For borrowers with multiple projects/multiple business units, banks may open multiple escrow accounts for monitoring of project-wise/unit-wise cash flows. Banks opening project specific current/escrow account shall ensure that cash flows coming in the account are from that project/unit only.
  • All lending banks should be part of the escrow agreement. The terms and conditions may be decided mutually by lending banks and the borrower. Borrowers shall be free to choose their escrow managing banks. Non-lender banks are not permitted to escrow accounts.
  • In cases where term loans are meant for purposes other than for supply of goods and services and where the payment destination is unidentifiable, banks may route such term loans through CC/OD or current accounts of the borrower opened as per the provisions of the circular. Banks shall ensure that where the payment destination is identifiable (i.e. refinance of existing debt, etc.), payment is made directly, without routing it through CC/OD accounts.
  • All banks, whether lending banks or other account holding banks, are required to monitor the accounts on regular basis as prescribed in the circular.
  • In case of change in exposure of banks/aggregate exposure of the banking system to the borrower, the borrowers shall be free to choose the bank(s) for the purpose of maintaining their operating current account/escrow account/CC/OD accounts within the overall framework of the circular. Further, banks will have to implement the new arrangements within a period of three months from the date of change in exposure.
  • Collections accounts can be debited only for transferring the funds to the escrow account of the borrower.

To read the full RBI circular, please click on the link.

RBI Circular – Discontinuation of Reports and Returns Under FEMA

The Reserve Bank of India (“RBI”) on November 13, 2020, issued a circular regarding the discontinuation of certain Reports & Returns under the Foreign Exchange Management Act, 1999. This initiative has been taken on account of ease of doing business and to reduce the cost of compliance for concerned entities. A total of 17 reports and returns have been discontinued with immediate effect.

The said Reports and Returns are as follows:

  1. A category-wise transaction where the amount exceeds $5000 per transaction.
  2. Category-wise, transaction-wise statement where the amount exceeds $25,000 per transaction.
  3. Statement of Purchase transactions of $10,000 and above (including transactions of their franchisees).
  4. Extension of Liaison Offices (LOs).
  5. Extension of Project Offices (POs).
  6. FII/FPI daily: Daily inflow/outflow of the foreign fund on account of investment by FPIs.
  7. FII/FPI Return (Monthly): Data relating to actual inflow/outflow of remittances on account of investments by Foreign Institutional Investors (FIIs) in the Indian Capital market.
  8. FVCI reporting: Inflows/outflows of remittances on account of investments by Foreign Venture Capital Investor (FVCIs) and Market value of Investments made by FVCIs.
  9. Reporting of Inflow/Outflow details in respect of Mutual Fund by Asset Management Companies.
  10. Market value of FII Investment in India on fortnightly basis.
  11. Market value of FII Investment in India on Monthly basis.
  12. FII holdings as a percentage of floating stock.
  13. Form DRR for Issue/transfer of sponsored/unsponsored Depository Receipts (DRs) -only Hardcopy filing is being discontinued.
  14. ADR/GDR Movement Report – two-way fungibility.
  15. Repatriation of Sales proceeds of underlying shares represented by FCCBs/GDRs/ADRs.
  16. GDR/ADR underlying shares issued, redeposited, and released monthly reporting.
  17. Monitoring of disinvestments by Overseas Corporate Bodies.

To read the full RBI circular, please click on the link