Jun 9, 2024
seen from United Kingdom
seen from Malaysia
seen from Türkiye
seen from Australia
seen from Russia
seen from China
seen from Türkiye
seen from Russia
seen from Malaysia
seen from Latvia
seen from China
seen from Türkiye
seen from China
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seen from Russia
seen from United Kingdom
seen from Russia
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seen from China
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Anyways here’s Uja
vacationers .... a sidebar pic of some treasured ocs, for a toyhouse profile layout i dont use any more. sometimes the details grab hold of you and you gotta go nuts on a piece. i don’t make the rules.
salvaging an oc and making him human,,, his name is uja
Secondment and TP Risk When: Employees Trigger Tax Trouble
“Secondments might look like simple HR moves — but tax authorities see more.”
If a foreign employee works in India, is it really a secondment? Or is it a cross-border service?
The answer could trigger:
Arm’s length charges
PE exposure
Transfer pricing compliance
In TP, even people can create risk. Here’s what you need to know.
As businesses globalize, sending employees on secondment to group companies in other countries has become routine. But for Transfer Pricing (TP) professionals, this simple HR move can quickly turn into a tax compliance puzzle.
The key question:
Is the secondee truly an employee, or is this actually a cross-border service? Let’s unpack this grey area.
What is a Secondment?
In a secondment arrangement, an employee of one entity (say, the foreign parent) is temporarily assigned to another entity (like an Indian subsidiary). The secondee works under the host company’s direction but remains on the home company’s payroll.
Why Tax Authorities Are Watching
Tax authorities are now scrutinizing secondment deals for two main reasons:
TP Angle:
If the secondee is effectively rendering a service from the parent to the subsidiary, the arrangement should involve an arm’s length service fee.
PE Risk (Permanent Establishment):
If a foreign employee is acting with authority or managing operations in India, it may trigger a PE, creating corporate tax exposure in India.
Key Indicators that Matter whether an arrangement is a true secondment or a service provision depend on the facts and conduct, not just the contract.
Some common red flags that suggest a service, not a secondment:
The secondee continues to report to the foreign entity
Key decisions are made under instructions from the parents
The subsidiary lacks control over day-to-day activities
The foreign company benefits from the output
On the other hand, a genuine secondment involves:
Full supervision by the host entity
Routine operational role, not strategic control
Cost recharge on a no-markup basis
No profit element or independent benefit to the foreign entity
SEBI’s letter dated 03.04.2025 to DCB Bank clarifies the role, designation, hierarchical placement of Compliance Officers under Reg 6(1) of
SEBI New Update 2025 – Position of Company Secretary
In a recent SEBI’s interpretative letter dated 03.04.2025 addressed to DCB Bank Ltd. The SEBI has provided crucial clarity on the designation a hierarchical placement of Compliance Officer in Listed Companies under Reg 6 (1) of SEBI(LODR), Regulation, 2015.
Background
DCB bank approached SEBI through a formal request dated 09.01.2025, seeking informal guidelines on whether its current compliance officer, Ms. Rubi Chaturvedi who holds a position five level below to Board of Directors and report to the MD & CEO- meets the revised criteria under amended LODR.
SEBI Interpretation
SEBI clarified that under the amended proviso to Regulation 6 (1), the Compliance Officer must be:
Positioned One level below the Board of Directors i.e. directly below the MD or Whole Time Director.
The Positioned is necessary to ensure greater without and access to decision making at the board level, enabling the Compliance Officer to effectively discharge their regulatory and governance responsibilities.
Key take aways from SEBI Guidance
Distinction between ‘Level’ and ‘Reporting’
In case a listed entity does not have a Managing Director or a Whole-Time Director, then the Compliance Officer shall not be more than one-level below the Chief Executive Officer or Manager or any other person heading the day-today affairs of the listed entity.
Implication for Listed Entities
Companies must restructure their internal hierarchies if necessary to ensure that the Compliance Officer hold the prescribed seniority.
A failure to comply may be seen as a breach of the LODR requirements.
MCA's 2025 amendment mandates e-filing of AOC forms, SH compliance, and board report extracts, boosting digitization and workplace transpare
Enhanced Corporate Governance through Companies (Accounts) Second Amendment Rules, 2025
Purpose of the Amendment-
The MCA introduced such an amendment to reflect the government’s ongoing efforts to increase accountability, digitize statutory filings and promote a safer and more inclusive work environment.
The objectives behind the Companies (Accounts) Second Amendment Rules, 2025 are multifaceted
Enhancing transparency by digitizing key statutory disclosures.
Upholding accountability by mandating disclosures on workplace conduct and employee rights.
Promoting gender inclusivity through a focus on sexual harassment and maternity benefit compliance.
Ensuring better governance by tightening corporate reporting practices and workplace ethics.
Filing of Extracts of Board Report and Auditors Report
The new amendment also brings in a requirement to file specific extracts electronically. The form documents must be filed electronically-
Extract Board Report along with Form AOC-1 and AOC-2. This extract must contain all the relevant disclosures, including those about sexual harassment complaints and maternity benefits compliance.
Extract of Auditor’s Report (Standalone) — this involves submitting the key observations and audit opinions of the company’s standalone financial statements.
Extract of Auditor’s Report (Consolidated) — If the companies have subsidiaries or associates, the consolidated audit report extract must also be electronically filed.
Conclusion
The Companies (Accounts) Second Amendment Rules, 2025 signify a progressive step towards better corporate governance, employee welfare and regulatory efficiency. Companies must take proactive steps to implement internal mechanisms that support timely and accurate disclosures. From ensuring workplace safety for women to embracing the digitization of statutory forms, these rules represent a holistic enhancement of the cooperative compliance ecosystem.
With effective planning and strong reporting structures, compliance with the Companies (Accounts) Second Amendment Rules, 2025 will not only help avoid penalties but also boost the company’s reputation in the eyes of regulators and stakeholders alike.