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Master Direction – Lending to Micro, Small & Medium Enterprises (MSME) Sector
The Master Direction incorporates the updated instructions / guidelines on the subject. The list of circulars consolidated in this Master Direction is indicated in the Appendix.

The EPFO had issued a circular dated 12.10.2015 stating that there is no employer employee relationship between a student trainee and the industry.

The EPFO has issued the following guidelines in the matter vide circular dated 27.7.22:

a. The educational/technical institute/University and the academic course in which a studenttrainee is enrolled shall be recognized by the competent authority.

b. “On-the-job-training” shall be an integral component of such course.

c. “On-the-job-training” shall not exceed period as may be specified in such course.

d. In case a student-trainee does not complete the training within the specified time including the period of extension, if any, as may be specified in such course, s/he shall cease to be student-trainee.

e. The industry shall engage student-trainees who are pursuing the course which are relevant to the industry.

f. The number of such student-trainee should not exceed such per cent. of the total workforce employed in the concerned factory/branch of an establishment as may be specified in a scheme or a similar scheme of the Central/State Government.

g. The engagement of student-trainees shall not be for a purpose other than as specified in such course/scheme.

h. The employer shall declare the details of such student-trainees in Electronic-challan-cumreturns (ECR) or furnish such details of student-trainees every month as may be directed by the Commissioner.

In such arrangement, the appointment which, in reality and in actual effect, is continuous, is artificially interjected by such facade or smoke screen of separate orders despite the fact that the work, for which the person is engaged, continues and the need for engaging the workman also continues. Such action of engaging the workman in such manner and then abruptly discontinuing the person, would not fall within the purview of clause (bb) of Section 2(oo) and such practice cannot get protection of the principle of fixed term appointment recognised by clause (bb) of Section 2(oo).

The owner of the vehicle is expected to verify the driving skills and not run to the licensing authority to verify the genuineness of the driving license before appointing a driver. Therefore, once the owner is satisfied, that the driver is competent to drive the vehicle, it is not expected from the owner thereafter to verify the genuineness of the driving license issued to the driver.

Three companies – Reliance New Energy Limited, Ola Electric Mobility Private Limited and Rajesh Exports Limited – signed the Production Linked Incentive (PLI) Scheme by the Government of India for Advanced Chemistry Cell (ACC) Battery Storage.

These companies will receive incentives under India’s Rs 18,100 crore program. In addition to the capacities allocated by the Ministry of Heavy Industries under the PLI Program, private players are expected to create battery manufacturing capacity to the tune of~95 GWh.

A total of 10 bids were received from companies with a manufacturing capacity of 128 GWh under the PLI Scheme of ACC Battery Storage. Under the ACC PLI program, the manufacturing facility would have to be set up within two years. The incentive will be disbursed thereafter over five years on the sale of batteries manufactured in India.

The Government has approved the PLI Scheme for achieving the manufacturing capacity of Fifty (50) GigaWatt Hour (GWh) of ACC for enhancing India’s manufacturing capabilities with a budgetary outlay of Rs 18,100 crores. As per the Government, the emphasis is to achieve greater domestic value addition, while ensuring that the cost of battery manufacturing in India is globally competitive.

As per the Government, this PLI scheme along with the existing PLI Scheme for the automotive sector (Rs 25,938 crore) and Faster Adoption of Manufacturing of Electric Vehicles (FAME) (Rs 10,000 crore) will enable India to move from traditional fossil fuel-based automobile transportation system to environmentally cleaner, sustainable, advanced and more efficient Electric Vehicles (EV) based system.

The Ministry of Health and Family Welfare (MoHFW), Government of India has notified new sets of specified health warnings for all tobacco product packs by amending the Cigarettes and other Tobacco Products (Packaging and Labelling) Rules, 2008, dated 21st July 2022, “The Cigarettes and other Tobacco Products (Packaging and Labelling) Third Amendment Rules, 2022”.

According to the MoHFW release, the amended Rules will be applicable effective December 1, 2022. The image (visit www.mohfw.gov.in and ntcp.nhp.gov.in for the image and specifications)
will be valid for a year following its commencement. Further, tobacco manufacturers will need to display the image along with the warning – “tobacco users die younger.”

The Ministry has said that violation of the above-mentioned provision is a punishable offence with imprisonment or fine as prescribed in Section 20 of the Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act, 2003.

Singapore (27.01%) and USA (17.94%) have emerged as the top two sourcing nations in FDI equity flows into India in FY 2021-22 followed by Mauritius (15.98%), Netherland (7.86%) and Switzerland (7.31%). The UNCTAD World Investment Report (WIR) 2022, in its analysis of the global trends in FDI inflows, said that India has improved one position to the 7th rank among the top 20 host economies for 2021.

The top five sectors receiving highest FDI Equity Inflow during FY 2021-22 are Computer Software & Hardware (24.60%), Services Sector (Fin., Banking, Insurance, Non Fin/Business, Outsourcing, R&D, Courier, Tech. Testing and Analysis, Other) (12.13%), Automobile Industry (11.89%), Trading 7.72% and Construction (Infrastructure) Activities (5.52%).
Karnataka (37.55%), Maharashtra (26.26%), Delhi (13.93%), Tamil Nadu (5.10%) and Haryana (4.76%) received the highest FDI Equity Inflow during FY 2021-22.

India is emerging as a preferred country for foreign investments in the manufacturing sector. FDI Equity inflow in Manufacturing Sectors have increased by 76% in FY 2021-22 (USD 21.34 billion) compared to previous FY 2020-21 (USD 12.09 billion).
India received the highest annual FDI inflows of USD 84,835 million in FY 21-22 overtaking last year’s FDI by USD 2.87 billion. Earlier, FDI inflows increased from USD 74,391 million in FY 19-20 to USD 81,973 million in FY 20-21.

The Ministry of Corporate Affairs has said that Companies can spend their CSR funds for activities related to the ‘Har Ghar Tiranga’ campaign.

“Spending of CSR funds for the activities related to this campaign such as mass scale production and supply of the national flag, outreach and amplification efforts and other related activities are eligible CSR activities,” the circular said, noting that companies can undertake these activities subject to fulfilling the Companies (CSR Policy) Rules, 2014 and related circulars/ clarifications issued by the ministry.

The campaign is aimed at invoking a feeling of patriotism in people, and awareness about the Indian flag. Held under the aegis of Azadi Ka Amrit Mahotsav, it encourages people to bring home the national flag and hoist it to mark the 75th year of India’s independence.

The requirement of submitting ‘Bill Of Export’ for supplies made to SEZ is prescribed under the Foreign Trade Policy. Recently, the requirement of submission of Bill Of Export for supplies made to SEZ in case of Advance Authorization has been relaxed vide.

In exercise of the powers conferred by section 55 of the Special Economic Zones Act,
2005 (28 of 2005), the Central Government hereby makes the following rules further to amend the Special Economic
Zones Rules, 2006