• Activities/items that require an Industrial License;
• Proposals in which the foreign collaborator has an existing financial / technical collaboration in India in the ‘same’ field. (Press Note No. 1 of 2005 series issued by the Government of India);
• Proposals for acquisition of shares in an existing Indian company in a financial services sector and where Securities and Exchange Board of India (SEBI) (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 is attracted;
• All proposals exceeding the sectoral caps or in sectors where FDI is not permitted.

The companies that are domicile to India are taxed on the global income whereas the foreign companies in India are taxed on their income within the Indian Territory. The incomes that are taxable in case of foreign companies are interest gained, royalties, income from the capital assets in India, income from sale of equity shares of the company, dividends earned, etc.

• Customs/Import duty is levied on imported products. This tax is a tariff - type tax payable at the time of entry of products into India. Peak rate of customs duty on non-agricultural goods is 10 percent, subject to certain exceptions.
• Excise duty is levied on manufacture of goods within India. This is also a tariff type tax and is payable on an ad valorem (i.e. a fixed percentage of the cost of production) basis.
• Value Added Tax is levied on the sale of a product that is produced or imported and sold for the first time. Either the central or the state government levies sales tax.
• Service tax is levied on specified services and is like excise duty except that excise duty is levied only on goods/products.

India realises that development of infrastructure is crucial to India's growth strategy. To this end India has sectoral policies to attract private/foreign investment in areas like power, telecommunications, road and highways, ports, oil and gas, etc.

Investing companies in infrastructure/ service sector:

In respect of the companies in infrastructure/service sector, where there is a prescribed cap for foreign investment, only the direct investment will be considered for the prescribed cap and foreign investment in an investing company will not be set off against this cap provided the foreign direct investment in such investing company does not exceed 49% and the management of the investing company is with the Indian owners. The automatic route is not available.

Construction and maintenance:

100% FDI is allowed under the automatic route in Construction and maintenance of-roads, rail-beds, bridges, tunnels, pipelines, ropeways, runways, waterways & water reservoirs, hydroelectric projects, power plants and industrial plants.

100% FDI is allowed under the automatic route in construction and maintenance of Roads and highways offered on BOT basis including collection of toll.

100% FDI is allowed under the automatic route in construction and maintenance of Rural Drinking Water Supply Projects, Package Water Treatment Plants, Rain and Rain Water Harvesting Structures, Waste-Water Recycling And Re-Use Techniques And Facilities, Rain-Water Re-Charging And Re-Use Techniques Of Ground Water.

Ports and Harbours:

100% FDI is allowed under the automatic route for:

1. Leasing of existing assets of ports
2. Construction/creation and maintenance of assets such as-container terminals bulk/break bulk/multipurpose and specialized cargo berths, warehousing, container freight stations, storage facilities and tank farms, cranage/ handling equipment, setting up of captive power plants, dry docking and ship repair facilities.
3. Leasing of equipment for port handling and leasing of floating crafts
4. Captive facilities for port based industries.

In accordance with the provision of Micro, Small & Medium Enterprises Development (MSMED) Act, 2006 the Micro, Small and Medium Enterprises (‘MSME’) are classified in two Classes:

• Manufacturing Enterprises, which are engaged in the manufacture or production of goods pertaining to any specified industries and are defined in terms of   investment in Plant & Machinery.
  

  Manufacturing Sector	Investment In Plant & Machinery
  Micro Enterprises	Upto INR 2.5 million
  Small Enterprises	INR 2.5 million up-to INR 50 million
  Medium Enterprises	INR 50 millionupto INR 100 million

  
  
• Service Enterprises: The enterprises engaged in providing or rendering of services and are defined in terms of investment in equipment.
  

  Service Sector	Investment In Plant & Machinery
  Micro Enterprises	Upto INR 1 million
  Small Enterprises	INR 1 million up-to INR 20 million
  Medium Enterprises	INR 20 million upto INR 50 million

Scope and Coverage of Provident Fund Act 

• Every factory engaged in any industry in Schedule I in which 20 or more persons are employed
• Every other establishment employing 20 or more persons which the central government may notify
• Any other establishment so notified by the Central Gov. even if employing less than 20 persons.
• By a notification regarding “special provisions in respect of International workers” The Ministry of Labour & Employment of India has made it mandatory for foreign employees (other than from a country with which India have entered into a social security agreement) employed in India with a company on which this PF Act is applicable.

Non-Applicability of Act

• Co-operative Society- An establishment registered under the Co-operative Societies Act employs less than 50 persons & working without the aid of Power.
• Government Undertaking- An establishment under the control of Central Government or State Government.
• A newly set up establishment for an initial period of 3 years from the date on which such establishment is or has been set up.

All factories / establishments employing 20 or more employees (10 or more in the case of establishments run with the aid of power) are coverable under the ESI Act, 1948. The rate of present ESI contribution applicable is 6.5% ( Employee 1.75% + Employer 4.75%) on gross wages excluding washing allowance every month in respect of every employee except those who are drawing more than Rs.10,000/- per month.

• 5th of following month
• 6th of following month in case duty is paid electronically through internet banking
• For month/quarter ending 31st March - 31st March

For Non-Corporate Assessees

• 5th of following quarter
• 6th of following quarter in case duty is paid electronically through internet banking
• For month/quarter ending 31st March - 31st March

1.  Service tax chargeable on any taxable service with reference to its value shall,—

• in a case where the provision of service is for a consideration in money, be the gross amount charged by the service provider for such service provided or to be provided by him;
• in a case where the provision of service is for a consideration not wholly or partly consisting of money, be such amount in money, with the addition of service tax charged, is equivalent to the consideration;
• in a case where the provision of service is for a consideration which is not ascertainable, be the amount as may be determined in the prescribed manner.

2.  Where the gross amount charged by a service provider, for the service provided or to be provided is inclusive of service tax payable, the value of such taxable service shall be such amount as, with the addition of tax payable, is equal to the gross amount charged.

3.  The gross amount charged for the taxable service shall include any amount received towards the taxable service before, during or after provision of such service.

A society can be formed with at least 10 members of age above 18 years. If object of society is creation of funds to be lent to its members, all the members must be residing in same town, village or group of villages or all members should be of same tribe, class, caste or occupation, unless Registrar otherwise directs. The provision of minimum 10 members or residing in same town/village etc. is not applicable if a registered society is member of another society.

The last word in name of society should be ‘Limited’, if the Society is registered with limited liability. Registrar is empowered to decide whether a person is agriculturist or non-agriculturist or whether he is resident of same town/village or whether the members belong to same caste/tribe etc. and his decision will be final.