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Steps towards Easing the Business Environment in India

pradeep goyal , Last updated: 02 May 2017  
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a) Starting a Business made simpler and easier

The Government of India has, in collaboration with the State Governments of NCT of Delhi and Maharashtra, undertaken significant reform measures to improve our rank in Starting a Business parameter.

Registration with ESIC and EPFO has been made real-time by eliminating all physical touch-points.

The requirement of opening a bank account has been removed as a mandatory condition for registration with ESIC and EPFO.

Requirement of minimum paid up capital and common seal under the Companies Act 2013 has been done away with.

Provision for online payment of EPFO and ESIC contributions has been introduced. Shram Suvidha Portal has been launched to issue unique Labour Identification Number (LIN), submission of common electronic returns under 16 Labour Acts and facilitate risk based inspections.

Maharashtra has combined the process of registration with VAT and Profession Tax. The registration will now be granted in 24 hours.

SPICe form has been notified as the sole application form for incorporation of companies (w.e.f., from 01.01.2017).

The fee for filing the incorporation form has been reduced from Rs. 2000/- to Rs.500.

(The above significant changes will scale down the number of procedures and days taken to start a business which will slash the costs involved as well.)

b) Reduction of procedures for Construction Permits

Both Municipal Corporation of Greater Mumbai (MCGM) and Municipal Corporation of Delhi (MCD) have reduced the number of procedures from 42 and 29 respectively to only 8.

MCGM has completed the process of single window approval by integrating with internal Departments as well as external Departments like AAI and NMA through a common application form.

In Mumbai, the building completion cum occupancy certificate is issued online through the single-window.

Site inspection for construction permits has been minimized by way of self-certification and introducing third party certification. During construction, submission of video clips by architects has been introduced in online Auto DCR system.

AutoCAD based software to scrutinize building plans has been implemented.

Both MCD and MCGM has introduced digital signing of building permit application, as well as maps, thereby eliminating need of physical submission of documents. The manual application for grant of construction permits has been discontinued.

MCGM and MCD Single Window Application System have a provision for online transfer of application to internal Departments and external Agencies and receipt of NOC.

MCD has completed the process of single window approval by integrating with internal departments as well as external Departments like DMRC, Delhi Fire Services, DUAC, AAI and NMA through a common application form. NOC from Labour Department of Delhi Government is not required if no manufacturing activity is being undertaken in the building.

MCD has eliminated the need for the applicant to visit the Property Tax Department to collect receipt of tax payment.

Delhi Development Authority (DDA) has notified the Unified Building Bye-laws. The unified building bye-laws have provision of deemed approval of sanctioning building plans within 30 days.

Colour-coded maps have been developed by AAI, DUAC and DMRC to enable applicants to determine whether NOC is required for the land for which permission is applied for.

88% of building plans have been sanctioned online by Municipal Corporation of Delhi.

Infrastructure charges have been abolished by Delhi Jal Board for commercial/ industrial connections. The development Charges for commercial and industrial water connections upto 50 sq. m is Rs. 45000 and above 50 sq. m is Rs. 1lakh.

(These reforms will reduce compliance burden by reducing the processes and time taken in grant of construction permit).

c) Getting Electricity made hassle-free

(This parameter witnessed a significant improvement in ranking from 51st in 2016 to 26th in 2017).

To make further progress various reforms have been undertaken. Online application for connections above 100KVA has been made mandatory in Maharashtra and Delhi. Delhi Electricity Regulatory Commission (DERC) has rationalized LT and HT tariff thereby allowing LT connections upto 150KVA. In Delhi and Mumbai, for getting a new electricity connection the number of procedures has been reduced to 3. Further, DERC has revised the application format of Delhi Electric Supply Code and Performance Standards Regulations, 2007 for faster release of electricity connection. The distribution licensees have been directed to process applications in the revised format along with the declaration form. Following are the two documents required for getting electricity connection: Identity proof Proof of ownership/ occupancy of premises. NOC/Consent to Establish is not required for getting industrial electricity connection for setting up new industries and projects. Amendment in Central Regulatory Authority regulation has been done to allow installation of transformers up to 500 KVA on double pole structure. The Central Regulatory Authority notification has been amended to waive electrical approval for 11 KV installations by DISCOMs and allowing self-certification by DISCOMs engineers. Supply Code Regulation and Standard of Performance (SOP) regulations have been modified by DERC and MERC to complete the process within 15 days. Now industrial/ commercial connections are being granted within 15 days in Delhi and Mumbai. Tata power has improved its System Average Interruption Duration Index (SAIDI) by 2.42 and it's System Average Interruption Frequency Index (SAIFI) by 2.41. Brihanmumbai Electricity Supply and Transport (BEST) has improved its System Average Interruption Duration Index (SAIDI) by 1.72 and it's System Average Interruption Frequency Index (SAIFI) by 3.26.

d) Import and Export procedures made easier

Under 'Trading across borders' parameter, Central Board of Excise and Customs(CBEC) has implemented Single Window Interface for Facilitating Trade (SWIFT) (online single window for clearance of goods) on the ICEGATE portal by integrating FSSAI, Animal Quarantine, Plant Quarantine, Drug Controller and Wildlife Control Bureau for imports. Customer risk management system has been extended to other regulatory agencies to ensure risk- based inspections. Limit on the number of consignments released under direct delivery has been removed by Ministry of Shipping thereby facilitating prompt delivery of goods in more cases. Terminal handling receipts have been eliminated from Jawaharlal Nehru Port Container Terminal which cuts down the time taken for clearing the containers at the port. About 99% of customs duties are being paid at 152 EDI locations through payment gateway of 24 Authorized Banks. 24x7 customs clearance facilities have been made available in Mumbai and Delhi ports. Customs Clearance Facilitation Committee has been set up at every major customs seaport and airport at Central level. Twenty-Foot Equivalent Unit (TEU) volume limit for direct delivery consignments has been removed. Filing of import and export declarations and manifests has been made online with digital signature. An electronic messaging system between Shipping lines and custodians for electronic delivery order has been introduced. Number of documents required for import and export has been reduced to three. Radio Frequency Identification (RFID) tags have been installed at JNPT to monitor containers at port gates

(These steps will improve the import and export regulatory environment significantly)

e) Easier Contract Enforcement

In 2017, India's rank improved by 6 points in this indicator from 178th to 172nd. National Judicial Data Grid (NJDG) was opened to general public on 19th September, 2015. NJDG is a national data warehouse for case data including case registration, cause list, case status and orders/judgments of courts across the country till District Level Courts. The Arbitration and Conciliation Act has been amended to reduce the time taken in arbitration proceedings and grounds on which an award may be challenged. Commercial Appellate Division Bench and Commercial Division Benches are functioning in Bombay High Court and Delhi High Court. These dedicated commercial benches will help faster disposal of commercial cases in Delhi and Mumbai.

f) Registering Property: Digitization of records and processes

Mumbai: Integration of Sub Registrars' offices with the Land Records Department has been completed. Registration data is being shared with the Land Records Department as part of the LR-SRO linkage under the National Land Records Modernization Program. This has been done for e-mutation in rural areas, and is presently being implemented across 358 tehsils comprising 427 Sub Registrar Offices in the state. In Maharashtra, all property tax records have been digitized. The iSarita system available in all SR offices has enabled online registrations in Mumbai as well as rest of Maharashtra. iSarita is available over MPLS VPN connections in the SR offices. For citizens, various aspects of the registration process have been made available online: Citizens can review the property details using eSearch facility (https://esearchigr.maharashtra.gov.in/testingesearch/Login.aspx) Citizens can carry out data entry in the system before going to the SR offices using the Public Data Entry portal (https://efilingigr.maharashtra.gov.in/PDEefiling/frmPublicLogin.aspx); Appointment slots can also be booked using the eStepIn system (http://igrmaharashtra.gov.in/TokenBooking/tokenbook.aspx) and Make online payment using GRAS (https://gras.mahakosh.gov.in/echallan/) Links to all these applications are available on the department's website (http://igrmaharashtra.gov.in/) The grievance management system (a single window service portal) has already been implemented by Government of Maharashtra - called "Aaple Sarkar" portal.

The Land Records (Cadastral mapping agency) related grievances are reported through "Aaple Sarkar" portal to the Land Records Department. (https://aaplesarkar.maharashtra.gov.in/en/) Documents of last 30 years have been scanned and are available in eSearch; mortgages against properties are also available in eSearch. Negative property list is available in iSarita and the system issues alerts Year-wise historical statement for number of documents registered and revenue collected is publically available at http://igrmaharashtra.gov.in/pdf/Statistic.pdf. All land parcel maps are already surveyed as a part of City Survey under section 122 and section 126 of MLRC 1966 and property cards (RoR) are present in Digital form for all privately held land plots. A necessary amendment has been made by Government Gazette vide Notification no. 24(3) Dated 11/04/2016 (Maharashtra Act No. XI of 2016) to mandate the adjudication of the cases/ disputes with regard to land within one year. Further, a project for 'e-DISNIC software” (Revenue Courts) for making the land dispute information available online has been rolled out. The land records of 203 rural villages have already been digitized. Land records of 142 villages out of these 203 villages have also been digitally signed. Central database for all SRO for properties registered after 2002 exists with search option. Registration documents post 2002 are available on the website in public domain. In Delhi, model sale deed format for property registration is available on the website of Department of Revenue. In Delhi, an electronic database for recording boundaries, checking points and providing cadastral information has been completed. In Delhi, linking of land ownership registry and mapping agency database on a pilot basis have been completed.

g) Resolving Insolvency

The Corporate Insolvency and liquidation provisions of the Insolvency and Bankruptcy Code, 2016 have been notified to facilitate smooth and time-bound settlement of insolvency and faster turnaround of businesses.

Section 8 companies formed by Institute of Company Secretaries of India and Institute of Chartered Accountants of India have been registered as Insolvency Professional Agency to monitor the conduct and safeguard the interest of insolvency professionals.

Companies can file reorganisation and insolvency cases under the Code before NCLT.

Regulations for insolvency professionals to conduct corporate insolvency resolution process have been notified.

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Published by

pradeep goyal
(Senior Partner)
Category Others   Report

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