Business Environment MAIN Book - CA CS Harish Mathariya, YES Academy

BUSINESS
ENVIRONMENT
CHAPTER 1: ENTREPRENEURSHIP SCENARIO
MAKE IN INDIA
INITIATIVES TAKEN BY THE GOVERNMENT As a national programme aimed at transforming India into a
global manufacturing hub
OF INDIA TO STREN-GTHEN
ENTREPRENEURSHIP IN INDIA to attract investments from both local and foreign corporate
houses (in 25 key areas)
Make in India launched in September 2014
after the ‘Modi’ Government came to power
Under this, government has increased the FDI limit in various
Stand Up India industries to attract foreign investment and participation
investor facilitation centre to assist to foreign businesses
locate partners and sites
Start-up India
Skill India
Investment in
physical
infrastructure
CA CS Harish A. Mathariya 98220 93220 Yes Academy 8888 545 545 1.1
Stand Up India :=> Introduction STAND UP INDIA :=> ELIGIBILITY
• Promoting entrepreneurship among women and scheduled
castes and tribes (Launched: 5/4/16) SC/ST and/or woman entrepreneurs, above 18
• By Department of Financial Services (DFS), Ministry of years of age
Finance, Government of India
Loans available for only green field project (first time
• Objective: facilitates bank loans between Rs 10 lakh and
Rs 1 Crore venture of the beneficiary in the manufacturing or
• to at least one Scheduled Caste (SC) or Scheduled Tribe services or trading sector)
(ST) borrower and at least one woman borrower per bank
branch for setting up a Greenfield enterprise In case of non-individual enterprises, at least 51% of
(manufacturing, services, agri-allied activities or the the shareholding and controlling stake should be held
trading sector)
by either SC/ST and/or Women Entrepreneur
• In case of non-individual enterprises at least 51% of the
shareholding and controlling stake should be held by Borrower should not be in default to any
either an SC/ST or woman entrepreneur
bank/financial institution
• https://www.standupmitra.in/Home/SUISchemes
• https://www.paisabazaar.com/business-loan/stand-up-
india-scheme/
Stand Up India :=> Loan details STAND UP INDIA :=> LOAN DETAILS
• Nature of Loan: Composite loan (inclusive of term loan Security: Loan may be secured by collateral security or
and working capital)
guarantee of Credit Guarantee Fund Scheme (CGFSIL)
• Amount: Between 10 lakh and 100 lakh
• Purpose: Setting up a new enterprise in manufacturing, Repayment: repayable in 7 years with a maximum
trading or services moratorium period of 18 months
• Size of Loan: Composite loan of 85% of the project cost Working capital : For drawal of working capital upto INR
(Exception: If borrower’s contribution along with support
from any other schemes exceeds 15% of the project 10 Lakh, the same may be sanctioned by way of overdraft.
cost) Working capital limit above INR 10 Lakh to be sanctioned
• Interest Rate: lowest applicable rate not to exceed by way of Cash Credit limit.
(base rate (MCLR) + 3%+ tenor premium)
Margin Money: 15% margin money (such schemes can be
✓ MCLR: Marginal cost of funds-based lending rate
is an internal reference rate for banks fixed by the drawn upon for availing admissible subsidies or for
RBI. meeting margin money requirements, in this cases required
✓ The MCLR is determined by the current cost of to bring in minimum of 10% of the project cost as own
funds, in contrast to the base rate, which is contribution) Example: Even If a state scheme supports
governed by the average cost of funds. borrower with 20% of project cost as subsidy then
✓ Tenor Premium:is the premium charged by the borrower shall be required to contribute 10% of project
banks for the risk associated with lending for cost.
higher tenors
START-UP INDIA := INTRODUCTION Income Tax Benefits:
Initiative by the Government for generation of employment
and wealth creation ➢exempts their 3 years income tax post the
incorporation year (only after getting a certificate
Goal: development and innovation of products and services from the Inter-Ministerial Board)
and increasing the employment rate
➢exemption from tax on Capital Gains if they invest
Benefit: Simplification of Work, Finance support, money in specified funds
Government tenders, networking opportunities
Registration Benefits:
launched by Prime Minister Shri. Narendra Modi on 16th
January 2016 (First announced by PM N Modi: 15 August ➢an application is there to facilitate registration. A
2015) single meeting is arranged to at the Start-up India
hub (Single Doubt solving window)
START-UP INDIA :=> BENEFITS Government Tenders:

Financial benefits: ➢start-ups get priority in getting government tenders
➢80% rebate on the patent costs (Since most ➢not required to have any prior experience
start-up patent based) Huge Networking Opportunities:
➢process of patent registration and related is ➢opportunity to meet with various Start-up
faster for them. stakeholders at a particular place and time
➢government pays the fees of the facilitator to
➢by conducting 2 Start-ups fests annually (both at
obtain the patent domestic as well as the international level)
SOME VITAL POINTS PERTAINING (a) Investors investing in Startups: Investing in startups is a
TO THE START UP INDIA risky proposition, but the low requirement for overhead
capital combined with high upside potential, makes it
(a) Startup India Hub : Is one dtop solution for Stakeholders lucrative for investors to put their bets on startups.
in Startup ecosystem & can interact amongst each other,
exchange knowledge & form successful partnerships in a (b) Foreign company registering in registering under
highly dynamic environment. Startup India hub: Any entity having at least one
registered office in India is welcome to register on the
(b) Investors (Like VC) adding value to the Startups in a lot hub as location preferences
of ways:
(a) Stakeholder Management: Investors manage co’s
board and leadership & also their knowledge
imparts vision & direction to company. START-UP INDIA :=> REGISTRATION
(b) Raising Funds & aid in networking to pitch their Can be done only from following types of
business to other investors. companies-
(c) Recruiting Talent Help bridge the talent gap by
recruiting the right set of people at the right time. 1. Partnership Firm
(d) Marketing : VCs assist with marketing strategy for 2. Limited Liability Partnership Firm
your product/service.
(e) M&A Activity : M&A opportunities in local 3. Private Limited Company.
entrepreneurial ecosystem to enable greater value
addition.
(f) Organizational Restructuring to increase capital
efficiency, lower costs and scale efficiently.
SKILL INDIA :=> INTRODUCTION NATIONAL SKILL DEVELOPMENT
Launched by: Prime Minister Shri Narendra Modi on 15 CORPORATION (NSDC)
July 2015 HTTPS://NSDCINDIA.ORG/TITP-HOME
MISSION: to train over 40 crore people in India in
NSDC is a not-for-profit public limited company (July
31, 2008)
different skills by 2022
Incorporated under sec. 25 (Now Sec. 8 of Co. Act
At Vocational training (instructional programs or courses 2013)
related to career) and certification of Indian youth for a
better livelihood was set up by Ministry of Finance as Public Private
Partnership (PPP) model
improve the overall scope and space for underdeveloped
sectors Government of India through Ministry of Skill
Development & Entrepreneurship (MSDE) holds 49%
It does so with assistance from the National Skill of the share capital of NSDC rest by private sector
Development Corporation or NSDC. aims to promote skill development by catalysing
creation vocational institutions
providing funding to enterprises, companies and
organizations that provide skill training
focus on 21 sectors under NSDC’s purview (Details of
various schemes – next slide)
PRADHAN MANTRI KAUSHAL INTERNATIONAL SKILL TRAINING
KENDRA (PMKK) A country’s ability & potential for growth is determined by
Vocational training to transform India into the skill capital the size of its youth population, India has a relative
of the world advantage at present over other countries (China and
Ministry of Skill Development and Entrepreneurship (MSDE) Indonesia). Youth today need to be harnessed, motivated,
intends to establish visible and aspirational Model Training skilled and streamlined to bring rapid progress for a country.
Centres (MTCs) in every district of the country
NSDC is the implementation agency for the project NATIONAL POLICY ON SKILL DEVELOPMENT
Funding Support: & ENTREPRENEURSHIP 2015
NSDC will provide a concessional secured loan Objective is to meet the challenge of skilling at scale with
funding per centre speed and standard (quality).
up to 75% of the project investment It aims to provide an umbrella framework to all skilling
activities being carried out within the country, to align them to
to cover expenditure: Training infrastructure, Training common standards and link the skilling with demand centres.
aid and other associated items & Civil work
This policy will also provide clarity on how skill development
Operations Support: efforts across the country can be aligned within the existing
sustainability of the centres will be assured against institutional arrangements.
dedicated training numbers under PMKVY
This policy will link skills development to improved
Each PMKK will be assured a training mandate for employability and productivity
three years
THE VISION, MISSION AND OBJECTIVES OF OBJECTIVES: NATIONAL POLICY ON SKILL
THE NATIONAL POLICY ON SKILL DEVELOPMENT & ENTREPRENEURSHIP 2015
DEVELOPMENT AND ENTREPRENEURSHIP The core objective of the Policy is to empower the individual,
2015 ARE by enabling her/ him to realize their full potential through a
Vision : “To create an ecosystem of empowerment by process of lifelong learning where competencies are
Skilling on a large Scale at Speed with high Standards and accumulated via instruments such as credible certifications,
to promote a culture of innovation based entrepreneurship credit accumulation and transfer, etc. As individuals grow,
which can generate wealth and employment so as to ensure the society and nation also benefit from their productivity
Sustainable livelihoods for all citizens in the country.”
and growth. This will involve:
Mission : The mission is to i. Make quality vocational training aspirational for both
 Create a demand for skilling across the country; youth and employers.
 Correct and align skilling with required competencies; ii. Ensure both vertical (Training) and horizontal (Education)
 Connect the supply of skilled human resources with pathways to skilled workforce.
sectoral demands; iii. Focus on an outcome-based approach towards quality
 Certify and assess in alignment with global and national skilling to increased employability
standards; and iv. Increase capacity & quality of training infrastructure
 Catalyse an ecosystem wherein productive and innovative and trainers.
entrepreneurship germinates, sustains and grows leading v. Aligning supply of skilled workers with sectoral
to creation of a more dynamic entrepreneurial economy requirements of industry
and more formal wage employment.
vi. Establish an IT based information system for
aggregating demand and supply of skilled workforce
THUS; THE CORE OBJECTIVE OF THE ENTRE-
PRENEURSHIP FRAMEWORK IS TO COORDINATE
& STRENGTHEN FACTORS ESSENTIAL FOR
GROWTH OF ENTREPRENEURSHIP ACROSS THE
i. Active involvement of employers in setting
occupational standards, helping develop curriculum
COUNTRY.
Promote entrepreneurship culture and make it aspirational
ii. Operationalize a well-defined framework aligned
with global standards to facilitate mobility of labour. Encourage entrepreneurship as a viable career option through
iii. Leverage modern technology to ensure scale, access advocacy.
and outreach Enhance support for potential entrepreneurs through mentorship and
iv. Recognise the value of on-the-job training, by making networks.
apprenticeships in actual work Integrate entrepreneurship education in the formal education system
v. Ensure that the skilling needs of the socially and
Foster innovation-driven and social entrepreneurship to address the
geographically disadvantaged and marginalized needs of the population at the bottom of the pyramid.
groups (like the SCs, STs, OBCs, minorities, differently
abled persons etc.) are appropriately taken care of. Ensure ease of doing business by reducing entry and exit barriers.
vi. Promote increased participation of women in the Facilitate access to finance through credit and market linkages.
workforce through appropriate skilling
Promote entrepreneurship amongst women.
vii. Promote commitment and ownership of all
stakeholders towards skill development and create an Broaden the base of entrepreneurial supply by meeting specific
needs of both socially and geographically disadvantaged sections
effective coordination mechanism. of the society including SCs, STs, OBCs, minorities, differently-abled
persons.
PRE-DEPARTURE ORIENTATION TECHNICAL INTERN TRAINING
TRAINING (PDOT) PROGRAM (TITP)
to orient potential migrant workers with regards to language, It promotes international collaboration through the transfer
culture, do's and don'ts in the destination country, the emigration of skills, technology, and knowledge among the
process and welfare measures, PDOT program has been launched participating countries.
MEA in collaboration with MSDE is conducting the PDOT program It offers training to the workers for a specific period (3 – 5
years) in Japan’s industrial society.
NSDC is the implementing agency for this program
To ensure that the most competent youth is selected and sent
A longer variant of PDOT i.e. 160 hours was offered at all IISCs
to Japan to participate in TITP.
which consisted of country orientation, language and digital
literacy. Ministry of Skill Development & Entrepreneurship (MSDE),
Government of India and the Ministry of Justice, Ministry of
A shorter variant of PDOT program i.e. 1 Day (ongoing) for
Foreign Affairs and Ministry of Health, Labour and Welfare
migrant workers who are likely to depart soon and register for the
of Japan signed a Memorandum of Cooperation initiating
training through registered recruitment agents.
the Technical Intern Training Program (TITP) in India in
PDOT program is delivered by trainers who have undergone October 2017.
Training of Trainers (ToT) program organized by MEA. So far, 52
trainers from existing IISCs and NSDC Training Partners have
undergone the PDOT (ToT).
INVESTMENT IN PHYSICAL MAJOR INITIATIVES OF THE
INFRASTRUCTURE :=> INTRODUCTION GOVERNMENT OF INDIA (UNION BUDGET
2022) FOR PHYSICAL INFRASTRUCTURE
As infrastructure is one of the key imperatives for turning the 1. Under PM GatiShakti the seven engines that have
“Make in India” vision into reality been identified that will drive PM GatiShakti are
Achieving a manufacturing-led transformation would Roads, Railways, Airports, Ports, Mass Transport,
necessitate addressing the bottlenecks across infrastructure. Waterways and Logistics Infrastructure. The projects
pertaining to these 7 engines in the National
Government has started taking initiatives: To start with,
public spending on infrastructure such as roads, railways, Infrastructure Pipeline will be aligned with PM
irrigation and urban infrastructure, need for stepping up the GatiShakti framework.
scale and scope of private investment in infrastructure by 2. Road Transport (a) National Highways Network to be
allowing 100% FDI in some areas of railway infrastructure expanded by 25000 Km in 2022-23. (b) Rs 20000
and by easing of FDI rules in construction. Development of Crore to be mobilized for National Highways Network
smart cities is likely to bridge the gap in infrastructure
development in the country. expansion.
3. Multimodal Logistics Parks- Contracts to be awarded
D&B’s estimates, physical infrastructure investment is through PPP mode in 2022-23 for implementation of
expected to surge to 10.4% of GDP by FY 25 from around
7.5% (Estimated) of GDP in FY 15 Multimodal Logistics Parks at four locations.
4. Railways- (a) One Station One Product concept to help
local businesses & supply chains. (b) 2000 Km of NEED FOR
railway network to be brought under Kavach,
indigenous world class technology and
the
capacity
ENTREPRENEURSHIP IN INDIA
augmentation in 2022-23. (c) 400 new generation Vande
Are considered ‘change agents’ (spark plugs) in the process
Bharat Trains to be manufactured during the next of industrial and economic development
three years. (d) 100 PM GatiShakti Cargo terminals
for multimodal logistics to be developed during the next promote capital formation by mobilising the idle saving of
three years. the people
5. Prime Minister’s Development Initiative for North-East
create immediate and large-scale employment
Region (PM-DevINE) (a) New scheme PM-DevINE launched
to fund infrastructure and social development projects in the promote balanced regional development by establishing
North-East. (b) An initial allocation of Rs. 1,500 crore made small-scale enterprises in rural area
to enable livelihood activities for youth and women under
help reduce the concentration of economic power,
the scheme. equitable redistribution of wealth, income and even
6. Vibrant Village Programmes Vibrant Villages Programme political power
for development of Border villages with sparse population,
limited connectivity and infrastructure on the northern encourage effective resource mobilization of capital and
border. skill
7 Mobilising Resources Data Centres and Energy Storage also promote country’s export business
Systems to be given infrastructure status.
8. Sovereign Green Bonds to be issued for mobilizing
resources for green infrastructure.
BOTTLENECKS IN
ICSI MCQ
ENTREPRENEURIAL GROWTH 1. According to a / an _____________, 300 mn youth will
Inefficient time management: Most entrepreneurs think on enter the labour force by 2025.
infinite time scales, as though they have plenty of time to (a) RBI Report
achieve their goals. Time is the most valuable resource, yet (b) Central Statistical Office Report
most entrepreneurial leaders don’t use it effectively. It is very (c) World Bank Report
important to analyze the business flow metrics and identify (d) Indian Labour Report
time-wasting processes.
Lack of money: As the company expands, there is a need to 2. The Stand up India scheme is managed by which of the
scale up the technology, invest in sales enablement and direct following ministry? (a) Ministry of Finance
resources to a number of other critical areas. Money is (b) Ministry of Human Resource Development
needed to achieve all of that. (c) Ministry of Statistics and Programme Implementation
(d) Ministry of Labour
Too much noise: noise generated through social media,
marketing, apps and vendors. It’s enough to make 3. “Most entrepreneurs think on infinite time scales, as
entrepreneurs think they need to chase down the "next big
thing" But limelight doesn’t guarantee success. though they have eons to achieve their goals”. The
mentioned phrase relates to which of the following
A small (or non-existent) network bottleneck?
(a) Growing too much too soon
Growing too much too soon: With the objective of growing (b) A small (or nonexistent) network
production, the problems also compound at the same rate.
One needs to pay attention and switch gears when that's (c) Too much noise
needed (d) Inefficient time management
4. ‘Make in India’ programme that was launched in
____________.
(a) September 2015
(b) September 2017
(c) September 2014
(d) September 2018
5. Registration of the Start-up cannot be done for which of

the following type of company?
(a) Partnership Firm
(b) Limited Liability Partnership Firm
(c) Private Limited Company.
(d) Public Limited Company
CHAPTER 2: BUSINESS ENVIRONMENT
BUSINESS ENVIRONMENT FEATURES & FACTORS INFLUENCING
MEANING BUSINESS ENVIRONMENT
❑ Business environment consists all those factors that affect 1. All the external forces : It includes all the forces,
a company’s operations and includes customers, institutions and factors affect the Business directly or
competitors, stakeholders, suppliers, industry trends, indirectly
regulations other government activities, social and 2. Specific and general forces : It includes specific forces
economic factors and technological developments. such as investors, customers, competitors & suppliers. Non-
❑ According to Keith Davis, “Business environment is the human or general forces are Social, Legal, Technological,
aggregate of all conditions, events and influence that Political, etc. which affect Business indirectly.
surrounds and affect it” 3. Inter-relation : All the forces and factors of Business
Environment are inter-related to each other. For example
❑ According to Andrews, “The environment of a company
with inclination of youth towards western culture, the demand
as the pattern of all external influences that affect its life
and development”. for fast food is increasing.
4. Uncertainty : It is very difficult to predict the changes of
❑ It is always changing and is uncertain Business Environment. As environment is changing very fast
❑ Business and Environment are totally interrelated for example in IT, fashion industry frequent and fast changes
(Environment refers surroundings business enterprise) are taking place.
5. Dynamic : Business environment is highly flexible and 1. Political environment : Affects economic environment of
keep changing. It is not static or rigid that is why it is businesses. Example, if a political body states that a
company must include a certain chemical in its product,
essential to monitor and scan the business environment the cost of the product differs. The company passes those
continuously costs on to the customer in the form of higher prices. If he
6. Complex : Difficult to understand impact of BE on the does not purchase the product, then the company does not
companies. Although it is easy to scan the environment but it receive the revenue.
is very difficult to know how these changes will influence 2. Economic environment : Economic environment can affect
Business decisions. Some-time change may be minor but it a company's business environment. During a recession,
might have large impact. consumers spend less on optional items such as cars and
7. Relativity : Impact of BE may differ from company to appliances. As a result, the business environment suffers.
company or country to country. Vice versa
3. Social Factors : are the cultural influences of the time. For
example, a fashion designer that creates bell bottom,
Types Of Environment striped pants will not succeed in an environment where
straight-leg, solid colored pants are desired.
• Political environment 4. Technological Factors : Businesses that do not keep up
• Social Factors with technology risk increased costs of production and
higher prices.
• Economic environment
• Technological Factors 5. Legal Factors : Often, a business will need to change how
it operates for legal reasons.
• Legal Factors
EASE OF DOING BUSINESS
“The ease with which an entity can start & run a business
to earn profit”
OR
“Refers to the Regulatory environment in the respective
country, related to setup & operate a business”
…. EASE OF DOING BUSINESS PARAMETERS TO BE CONSIDERED
IN EDB
EASE OF DOING BUSINESS INDEX EASE OF DOING BUSINESS INDEX
BY WORLD BANK FOR INDIA (EDB) BY WORLD BANK FOR INDIA
(AMONG 190 COUNTRIES) 1. The World Bank released its latest Doing Business Report (DBR,
2020) on24th October 2019. India has recorded a jump of 14
positions against its rank of 77 in 2019 to be placed now at
63rdrank among 190 countries assessed by the World Bank
2. India's leap of 14 ranks in the Ease of Doing Business ranking is
significant considering that there has been continuous
improvement since 2015 and for the third consecutive year India
is amongst the top 10 improvers.
3. The Doing Business assessment provides objective measures of
business regulations and their enforcement across 190 economies
on ten parameters affecting a business through its life cycle. The
DBR ranks countries on the basis of Distance to Frontier (DTF), a
score that shows the gap of an economy to the global best
practice. This year, India’s DTF score improved to 71.0 from
67.23 in the previous year
4. India has improved its rank in 6 out of 10 indicators and has
moved closer to international best practices (Distance to Frontier
score) on 7 out of the 10 indicators:
5. (6 Indicators):- Construction Permits; Trading Across Borders;
Starting a Business; Access to Credit & Access to Electricity
THE IMPORTANT FEATURES OF INDIA'S PERFORMANCE:
1. The World Bank has recognized India as one of the top 10 improvers for the third consecutive year.
2. Recovery rate under resolving insolvency has improved significantly from 26.5% to 71.6%.
3. The time taken for resolving insolvency has also come down significantly from 4.3 years to 1.6 years.
4. India continues to maintain its first position among South Asian countries. It was 6th in 2014.
• DPIIT leads dynamic reform exercise called Business
EASE OF DOING BUSINESS INDEX BY Reforms Action Plan, which ranks all the States and UTs in
DEPARTMENT FOR PROMOTION OF the country based on implementation of designated reform
parameters.
INDUSTRY & INTERNAL TRADE • The focus of the reforms is streamlining the existing
(DPIIT) FOR STATES regulations and processes and eliminating unnecessary
requirements and procedures.
• Department for Promotion of Industry and Internal Trade • The Action Plan covers number of reform areas such as
(DPIIT), Investment Enablers, Online Single Window System, Land
administration and Transfer of Land and Property,
• in coordination with Central Ministries/Departments and
Governments of States/Union Territories (UTs), Construction Permits Enablers, Labour Regulation Enablers,
Environment Registration Enablers, Inspection Enablers,
• has taken several reform measures Paying Taxes, Obtaining Utility Permits, etc
• The Ministry of Labour and Employment has taken several
• with an aim to improve regulatory environment and
initiatives towards simplification of Labour Laws for ease
• facilitate doing business in India of doing business.
• Through Labour Codes provisions have been made for one
registration for an establishment instead of multiple
registrations, one license & one return in place of multiple
licenses and returns Shram Suvidha Portal (SSP) is a major
IT initiative of the Ministry, towards ease of doing business
and reducing the complexities in labour law compliance`
Department of Justice (DoJ) and Department of Legal Affairs have taken following measures for
timely disposal of commercial cases which promote Ease of doing Business:
1. The Commercial Courts Act, 2015 enacted to deal with commercial disputes in India. To streamline their functioning, the
pecuniary value of cases reduced to Rs. 3 lakh from earlier Rs. 1 crore. Above act is administered by the Department of
Legal Affairs.
2. Designated Special Courts for hearing Infrastructure projects related disputes have been set up in 23 High Courts along
with Special Commercial Benches in High Courts for dealing with high value commercial disputes i.e. above Rs. 500 crores
have been set up in 8 High Courts.
3. Alternate Dispute Resolution Mechanism by way of Pre-Institution Mediation & Settlement (PIMS) has been provided in the
Act. It provides an opportunity to the parties to resolve commercial disputes outside the ambit of the courts at the very
outset which has reduced the clogging of cases in Commercial Courts.
4. The Act mandates holding of Case Management Hearing (Pre-Trial Conference) to complete the trial in a time bound
manner. This has been institutionalized leading to speedier resolution of commercial cases.
5. Commercial cases are now randomly and automatically assigned to Judges using Case Information System (CIS) software
eliminating human intervention this enhancing judicial transparency. To ensure compliance of three adjournment Rule a
facility of colour banding in CIS software has been created which provides information regarding the number of
adjournments in a case and facilitates speedy decision making.
6. Electronic filing of commercial cases (E-Filing) has been operationalised in most Commercial Courts to reduce the time
taken to file cases. Electronic service of Summons (E-Summons) of commercial cases has been operationalised in few
commercial courts which reduces the delay in sending summons to parties. Electronic Case management tools (ECMT) for
Judges and Advocates have been integrated into one single CIS Software, which has enhanced judicial productivity and
made the justice delivery system more accessible, reliable and transparent. Dedicated Websites have been started for
Commercial Courts.
7. The Government has notified the Commercial Courts (Statistical Data) Rules, 2018 for making available detailed data
points on various aspects of commercial cases for effective monitoring of time taken in case disposal by these courts.
DPIIT, in coordination with Central Ministries/Departments, States and UTs, leads the exercise of reducing compliance
burden for improving overall business regulatory environment in the country. Objective is to improve Ease of Doing
Business and Ease of Living and Government to Business and Citizen interface hassle-free.
Key focus areas of the exercise are:
▪ Rationalization/Auto-renewal of licenses/certificates/permissions
▪ Risk-based / Third-party Inspections and Audits
▪ Standardized and simplified return filing
▪ Rationalized maintenance of registers
▪ Minimize / eliminate display requirements
▪ Digitization and simplification of manual forms and records
▪ Decriminalization of minor technical and procedural defaults
▪ Repeal or amendment of redundant laws
Ministry of Micro, Small and Medium Enterprises also undertaken various steps towards improving the ease of doing
business that include, introduction of Online Registration – Udyam Registration (completely online and no fees),
constitution of Review Committee to monitor the progress of the implementation of the Policy, opening of a grievance
cell to redress the Grievances of MSEs & launch of “MSME Sambandh Portal” to monitor the progress of
procurement by the CPSEs from MSEs, etc.
ICSI Imp MCQ
1. The World Bank released the Doing Business Report (DBR), 2019 on _____________.
(a) 31st October, 2018 (b) 31st August, 2018 (c) 31st July, 2018 (d) 31st May, 2018
2. The DBR is an assessment of _________ and covers 10 indicators which span the lifecycle of a business.
(a) 200 economies (b) 190 economies (c) 180 economies (d) 170 economies
3. In the World Bank’s latest Doing Business Report(DBR, 2019), India has recorded a jump of 23 positions to be
placed at ___________ among 190 countries
(a) 63rd rank (b) 87th rank (c) 97th rank (d) 107th rank
4. Who gave the following definition, “Business environment is the aggregate of all conditions, events and
influence that surrounds and affect it”?
(a) FW Taylor (b) Henry Fayol (c) Keith Davis (d) Maslow
5. According to Ease of Doing Business Index by Department for Promotion of Industry and Internal Trade (DPIIT)
for States, what is the rank of India with reference to starting a business?
(a) 140 (b) 157 (c) 167 (d) 137
CHAPTER 3 :KEY GOVERNMENT INSTITUTIONS
Key NITI AAYOG (Replacement of Yojana Aayog / Planning Commission)
Government SUSTAINABLE ACTION FOR TRANSFORMING HUMAN CAPITAL (SATH)
Institutions
MINISTRY OF CORPORATE AFFAIRS
SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI)
RESERVE BANK OF INDIA (RBI)
INSOLVENCY AND BANKRUPTCY BOARD OF INDIA (IBBI)
NATIONAL COMPANY LAW TRIBUNAL (NCLT)
NATIONAL COMPANY LAW APPELLATE TRIBUNAL (NCLAT)
NITI AAYOG (REPLACEMENT OF YOJANA AAYOG / PLANNING COMMISSION)
• The Planning Commission was an institution formed in

March 15 1950 by Nehru Government of India,
➢ Function 1: which formulated India's Five-Year
Now these functions have
Plans
withdrawn & NITI Aayog
➢ Function 2: Finance distributions among states works like a think tank
➢ 1951 to 2017 (12 Five Year’s Plans)
• NITI Aayog is Non-Constitutional Body
• Established 1st January 2015
• Head quarter: Delhi NITI Aayog's entire activities is divided into two main
hubs/divisions: Team India and Knowledge
• Indian Government’s Think Tank and Innovation. The two hubs are at the core of NITI
• Primary Objective: Suggestion on Social & Economic Aayog's efficient functioning. The Team India Hub carries
matters to Govt. so that govt. could build policies in out the mandate of fostering cooperative federalism and
favour of people designing policy and program frameworks.
Harish A. Mathariya 98220 93220 Yes Academy 8888 545 545 3.2
OBJECTIVES FEATURES
▪ To evolve a shared vision of national development NITI Aayog is developing itself as a State-of-the-art
priorities, sectors & strategies with active involvement of Resource Centre, with the necessary resources, knowledge
States. and skills,. NITI Aayog’s entire scope of activities can be
▪ To foster cooperative federalism divided into four main heads (Or Functions):
▪ To formulate credible plans at village level. 1. Design Policy & Programme Framework
▪ Areas in the interests of national security are
2. Foster Cooperative Federalism
incorporated in economic strategy and policy.
▪ To pay special attention to the sections of our society that 3. Monitoring & Evaluation
not benefiting adequately from economic progress. 4. Think Tank and Knowledge & Innovation Hub
▪ To design strategic and long term policy and programme
frameworks & monitor & take corrections. NITI Aaayog is based on the 7 pillars of effective
▪ To encourage partnerships between key stakeholders and governance
like-minded Think tanks, educational institutions. (1) Pro-People
▪ To create a knowledge, innovation and entrepreneurial (2) Pro-Activity
support system. (3) Participation
▪ To maintain a state-of-the-art Resource Centre (Most (4) Empowering
recent stage of development) (5) Inclusion of all
▪ To focus on technology upgradation and capacity (6) Equality
building for implementation of programmes and
(7) Transparency.
initiatives.
SDG (SUSTAINABLE DEVELOPMENT
GOAL) VERTICAL (DIVISION)
Vision and Mission
NITI Aayog The SDG Vertical, in collaboration with Union Ministries and
States/ UTs, is the agency for coordinating & monitoring the
• Bottom Top Approach Sustainable Development Goals. Through cooperative and
• States Involvement competitive federalism. The Vertical works closely with key
stakeholders—including the Government, civil society,
• No Finance Distribution private sector, academia, think tanks, research organisations,
and multilateral organisations—to fast-track the
achievement of SDGs in the country
Planning Commission
Core Functions
• Top to Bottom Approach Progress Monitoring
SDG Localisation (State and District level capacity building)
• States Not Involved
Private Sector Engagement
• Finance Distribution by SDG Costing and Financing (Cost to achieve goal & related
Planning commission Finance)
Multidimensional Poverty Measurement and Reduction
(Paisa/Education/Basic Infrastructure)
SUSTAINABLE ACTION FOR TRANSFORMING HUMAN CAPITAL - Education (SATH-E)
Was launched in 2017 to identify and build three (3) ‘role model’ States for the school education sector.
After an elaborate selection process, Jharkhand, Odisha and Madhya Pradesh were chosen.
The first phase of SATH-E was completed in March 2020. 2nd phase commenced on Oct 2020 for 2 years terms.
A few of the achievements are as follows:

1. Learning enhancement programme/remedial teaching with workbook support for approximately 2.3 crore students
implemented.
2. Academic monitoring of schools and students streamlined, with nearly 1.5 lakh inspections carried out every month.
3. Comprehensive rewards and recognition programmes, including external certifications, initiated.
4. Assessment reforms, including spot testing and learning tracking formats, introduced.
5. Multiple rounds of teacher training undertaken.
6. In Madhya Pradesh, 30% of the students moved from lower-level foundational literacy, numeracy learning cohorts to the
highest learning level for grades 3–8 in two years of the ‘Dakshta Unnayan’ learning enhancement programme.
7. In Odisha, average improvement of 10–15% observed in learning outcomes due to the ‘UjjwalUtthan’ learning
enhancement programme.
8. In Jharkhand, 12% improvement across most competencies was recorded through the ‘Gyan Setu’ learning enhancement
programme.
9. With the onset of the Covid-19 pandemic, SATH-E adapted itself as ‘Digi-SATH’ to provide undeterred support via
digital mediums.
10. Under the Digi-SATH initiative, MP’s ‘Hamara Ghar Hamara Vidyalaya’ and ‘Digi-LEP’ (or ‘Digital Learning Enhancement
Programme’), Odisha’s ‘Shiksha Sanjog’ and ‘Shiksha Sampark’, and Jharkhand’s ‘Hamara Doordarshan Hamara
Vidyalaya’ have been providing online education and teacher training
Also carry out function of CG relating to
MINISTRY OF CORPORATE AFFAIRS administration of:
1. primarily concerned with administration of • Partnership Act
the • the Companies (Donations to National Funds) Act,
1951 and
2. Companies Act 2013, • Societies Registration Act, 1980
3. the Limited Liability Partnership Act, 2008 The affiliated offices of Ministry of
4. other allied Acts Corporate Affairs are as under
5. rules & regulations framed there-under • Serious Fraud Investigation Office
• Competition Commission of India
6. Competition Act, 2002 • Indian Institute Of Corporate Affairs
to prevent practices having adverse effect on
competition, to promote and sustain competition Serious Fraud Investigation Office
in markets, to protect the interests of consumers, (SFIO)(Established on 1.10.03)
also exercise supervision on ICAI, ICSI & ICMAI • For Failure of NBFC
• Companies Vanishing
• Stock Market Scam
COMPETITION COMMISSION INDIAN INSTITUTE OF
OF INDIA CORPORATE AFFAIRS:
• IICA has been established by the Indian Ministry of
was established under the Competition Act, Corporate Affairs
2002 • For capacity building and training in various subjects and
for the administration, implementation and matters relevant to corporate regulation and governance
enforcement of the Act, such as corporate and competition law, accounting and
auditing issues, compliance management, corporate
was duly constituted in March 2009 governance, business sustainability through environmental
sensitivity and social responsibility, e-Governance and
objectives of the Commission enforcement etc.
 prevent practices having adverse effect on competition • One of the wings of IICA, the ICLS Academy, has the
responsibility for conducting the Induction & Advanced
 To promote and sustain competition in markets Training for Probationary Officers (POs) belonging to the
 To protect the interests of consumers Indian Corporate Law Service recruited through the
 To ensure freedom of trade Common Exam of Civil Services Examination conducted by
UPSC
• The Institute has been designed with an eye on the future to
provide a platform for dialogue, interaction and
partnership between governments, corporate, investors, civil
society, professionals, academicians and other stakeholders
in the emerging 21st century.
SECURITIES AND EXCHANGE
BOARD OF INDIA (SEBI) FUNCTIONS OF SEBI
1. is a statutory regulatory body
2. to regulate the Indian capital markets
Protective Function (Protecting the investor interest)
3. SEBI was founded on April 12, 1992, under the SEBI
Act, 1992 • Prohibits insider trading: Is the act of buying or
4. Headquartered in Mumbai, India, SEBI has regional selling of the securities by the insiders of a
offices in New Delhi, Chennai, Kolkata and company (directors, employees & promoters)
Ahmadabad • Check price rigging: Is the act of causing unnatural
5. other local regional offices across prominent cities in fluctuations in the price of securities by either
India increasing or decreasing the market price of the
6. objective of SEBI is to ensure that the Indian capital stocks that leads to unexpected losses for the
market works in a systematic manner and provide investors
investors with a transparent environment for their • Promoting fair practices: SEBI promotes fair trade
investment practice and works towards prohibiting fraudulent
7. Preamble: “...to protect the interests of investors in
activities related to trading of securities.
securities and to promote the development of, • Financial education provider: SEBI educates the
and to regulate the securities market and for matters investors by conducting online and offline sessions
connected therewith or incidental
thereto.”
Regulatory Function: (Involve establishment POWERS OF SEBI
of rules and regulations for financial
intermediaries along with corporates) • can conduct
• SEBI has defined the rules and regulations and formed hearings and pass
guidelines and code of conduct for this ruling judgements
Quasi-
in cases
• Regulating the process of taking over of a company. Judicial
of unethical and
• Conducting inquiries and audit of stock exchanges. fraudulent trade
• Regulates the working of stock brokers, merchant practices
brokers. • draft rules and
Quasi- regulations for the
Developmental Function: Steps taken to Legislati protection of the
provide the investors knowledge of the ve interests of the
trading & market function. investor
• Training of intermediaries who are a part of the • authorised to file a

security market. case against
• Introduction of trading through electronic means or Quasi-
anyone who
through the internet by the help of registered stock Executive
violates its rules
brokers. and regulation
• By making the underwriting an optional system in order
to reduce cost of issue
RESERVE BANK OF INDIA (RBI)
MAIN FUNCTIONS OF RBI
• Banker’s Bank (Central Bank of India) Monetary Authority
• established on April 1, 1935 in accordance with
the provisions of the Reserve Bank of India Act,
1934 Regulator and supervisor of the financial system
• Central Office: initially established in Calcutta
but was permanently moved to Mumbai in 1937
(Governor sits and where policies are Manager of Foreign Exchange
formulated)
• Originally privately owned, since nationalisation
in 1949, the Reserve Bank is fully owned by the Issuer of currency
Government
• Has 27 regional offices
• Most of them in state capitals and 04 Sub-offices Developmental role
Regulator and Supervisor of Payment and Settlement

Systems
Related Functions: like banker to; govt. & Banks
INSOLVENCY AND BANKRUPTCY BOARD OF INDIA (IBBI)
Established on 1st October, 2016 under the Insolvency and Bankruptcy Code, 2016 (Code). It is a key pillar of the
ecosystem responsible for implementation of the Code that consolidates and amends the laws relating to reorganization and
insolvency resolution of corporate persons, partnership firms and individuals in a time bound manner for maximization of the
value of assets of such persons, to promote entrepreneurship, availability of credit and balance the interests of all the
stakeholders.
It is a unique regulator: regulates a profession as well as processes. It has regulatory oversight over the Insolvency
Professionals, Insolvency Professional Agencies, Insolvency Professional Entities and Information Utilities. It writes and enforces
rules for processes, namely, corporate insolvency resolution, corporate liquidation, individual insolvency resolution and
individual bankruptcy under the Code. It has recently been tasked to promote the development of, and regulate, the
working and practices of, insolvency professionals, insolvency professional agencies and information utilities and other
institutions, in furtherance of the purposes of the Code
NATIONAL COMPANY LAW TRIBUNAL (NCLT)
Central Government has constituted NCLT under section 408 of the Co. Act, 2013 w.e.f. 01st June 2016.
Ministry of Corporate Affairs have set up eleven Benches, one Principal Bench at New Delhi and ten Benches at New
Delhi, Ahmadabad, Allahabad, Bengaluru, Chandigarh, Chennai, Guahati, Hyderabad, Kolkata and Mumbai.
These Benches will be headed by the President and 16 Judicial Members and 09 Technical Members at different
locations.
NCLT is the outcome of the Eradi Committee.
NCLT was intended to be introduced in the Indian legal system in 2002 under the framework of Companies Act, 1956
however, due to the litigation with respect to the constitutional validity of NCLT which went for over 10 years, therefore, it
was notified under the Companies Act, 2013.
It is a quasi-judicial authority incorporated for dealing with corporate disputes that are of civil nature arising under the
Companies Act. However, a difference could be witnessed in the powers and functions of NCLT
NCLT works on the lines of a normal Court of law in the country and is obliged to fairly and without any biases determine
the facts of each case and decide with matters in accordance with principles of natural justice
MAJOR FUNCTIONS OF NCLT
Registration of Companies: empowered in taking several steps, from cancelling the registration of a company to dissolving
any company. The Tribunal could even render the liability or charge of members to unlimited. With this approach, NCLT can
de-register any company in specific situations when the registration certificate has been obtained by wrongful manner or
illegal means
Transfer of shares: NCLT empowered to hear grievances of rejection of companies in transferring shares and securities
Deposits: Unhappy depositors now have a remedy of class actions suits for seeking remedy for the omissions and acts on
part of the company that impacts their rights as depositors.
Power to investigate: investigation about the affairs of the company could be ordered with the help of an application of
100 members whereas previously the application of 200 members was needed for the same. Moreover, if a person who
isn’t related to a company and is able to persuade NCLT about the presence of conditions for ordering an investigation then
NCLT has the power for ordering an investigation. An investigation which is ordered by the NCLT could be conducted within
India or anywhere in the world
Freezing assets of a company
Converting a public limited company into a private limited company
NATIONAL COMPANY LAW DISSATISFACTION WITH TRIBUNAL
APPELLATE TRIBUNAL (NCLAT) ORDERS
Constituted under Section 410 of the Companies Act, 2013 If a group or an individual is to be dissatisfied with the
for hearing appeals against the orders of National orders passed by the Tribunal Court it is obvious to move on
Company Law Tribunal(s) (NCLT), with effect from 1st June, to the next, only, option, that is filing an appeal to the
Appellate Court where the decisions of NCLT are reviewed
2016
and checked from the point of law and facts.
Also the Appellate Tribunal for hearing appeals against the
orders passed by NCLT(s)
The Tribunal Court is in charge of finding and gathering
With effect from 1st December, 2016. NCLAT is also the evidence while the Appellate Court decides cases based on
Appellate Tribunal for hearing appeals against the orders the already collected evidence. If the outcome is not
passed by Insolvency and Bankruptcy Board of India under satisfactory even then, one should approach the Supreme
Section 202 and Section 211 of IBC. Court.
Also the Appellate Tribunal to hear and dispose of appeals

against any direction issued or decision made or order
passed by the Competition Commission of India (CCI)
ICSI – Module Que
1. The Insolvency and Bankruptcy Board of India was established on___________.
(a) 1st October, 2016 (b) 1st October, 2017 (c) 1st October, 2015 (d) 1st October, 2018
2. Which of the following is not the affiliated office of Ministry of Corporate Affairs?
(a) Serious Fraud Investigation Office (b) Competition Commission of India
(c) Indian Institute of Corporate Affairs (d) Central Statistics Office
3. National Company Law Tribunal is the outcome of the _______________.

(a) Srikrishna Committee (b) NL Mitra Committee
(c) Eradi Committee (d) Uday Kotak Committee
4. National Company Law Appellate Tribunal (NCLAT) was constituted under _________of the Companies Act, 2013
(a) Section 310 (b) Section 410
(c) Section 510 (d) Section 610
5. The Reserve Bank of India was established on ___________

(a) April 1, 1940 (b) April 1, 1950
(c) April 1, 1935 (d) April 1, 1960
CA CS Harish A. Mathariya
Founder - Only Lectures
Co-Founder Yes Academy
Harish Mathariya is a Chartered Accountant as well as a Company Secretary by
profession. He specializes in extending services in the areas Finance & Audi ng. He is also
a visi ng faculty to the most reputed Management Ins tutes in & around Pune.
His core lies in rou ng accounts through the very basics, for which, he has been the most
loved face for Accounts.
Having taught students for over 7 years, he is well known for taking Accounts in a very
conceptual way batches for Non-commerce students.
To his credit; he as 100+ All India Rankers, which also includes AIR 1 twice.
His students acknowledge his simpliﬁca on in Accounts as "Don't worry Bol Hari". He is a
Founder of h p://www.onlylectures.com and is also a Co-Founder of YES Academy, most
loved academy for CS
CA CS Harish A. Mathariya

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BUSINESS

START-UP INDIA :=> BENEFITS Government Tenders:

5. Registration of the Start-up cannot be done for which of

• The Planning Commission was an institution formed in

A few of the achievements are as follows:

• Training of intermediaries who are a part of the • authorised to file a

Regulator and Supervisor of Payment and Settlement

Related Functions: like banker to; govt. & Banks

Also the Appellate Tribunal to hear and dispose of appeals

3. National Company Law Tribunal is the outcome of the _______________.

5. The Reserve Bank of India was established on ___________

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