Doing Business 2020 India Economy Profile India Page 1 Doing Business 2020 India Economy Profile of India Doing Business 2020 Indicators (in order of appearance in the document) Starting a business Procedures, time, cost and paid-in minimum capital to start a limited liability company Dealing with construction permits Procedures, time and cost to complete all formalities to build a warehouse and the quality control and safety mechanisms in the construction permitting system Getting electricity Procedures, time and cost to get connected to the electrical grid, and the reliability of the electricity supply and the transparency of tariffs Registering property Procedures, time and cost to transfer a property and the quality of the land administration system Getting credit Movable collateral laws and credit information systems Protecting minority investors Minority shareholders’ rights in related-party transactions and in corporate governance Paying taxes Payments, time, total tax and contribution rate for a firm to comply with all tax regulations as well as postfiling processes Trading across borders Time and cost to export the product of comparative advantage and import auto parts Enforcing contracts Time and cost to resolve a commercial dispute and the quality of judicial processes Resolving insolvency Time, cost, outcome and recovery rate for a commercial insolvency and the strength of the legal framework for insolvency Employing workers Flexibility in employment regulation and redundancy cost Page 2 Doing Business 2020 India About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local firms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of employing workers. Although Doing Business does not present rankings of economies on the employing workers indicators or include the topic in the aggregate ease of doing business score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more efficient regulation; offers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business offers detailed subnational studies, which exhaustively cover business regulation and reform in different cities and regions within a nation. These studies provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The first Doing Business study, published in 2003, covered 5 indicator sets and 133 economies. This year’s study covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has benefited from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. To learn more about Doing Business please visit doingbusiness.org Page 3 Doing Business 2020 India Ease of Doing Business in DB RANK DB SCORE Region South Asia India Income Category Lower middle income 63 Population 1,352,617,328 71.0 City Covered Mumbai, Delhi Rankings on Doing Business topics - India 13 22 25 27 52 68 115 136 154 163 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Investors Borders Permits Topic Scores 81.6 78.7 89.4 47.6 80.0 80.0 67.6 82.5 41.2 62.0 Starting a Business (rank) 136 Getting Credit (rank) 25 Trading across Borders (rank) 68 Score of starting a business (0-100) 81.6 Score of getting credit (0-100) 80.0 Score of trading across borders (0-100) 82.5 Procedures (number) 10 Strength of legal rights index (0-12) 9 Time to export Time (days) 18 Depth of credit information index (0-8) 7 Documentary compliance (hours) 12 Cost (number) 7.2 Credit registry coverage (% of adults) 0.0 Border compliance (hours) 52 Paid-in min. capital (% of income per capita) 0.0 Credit bureau coverage (% of adults) 63.1 Cost to export Documentary compliance (USD) 58 Dealing with Construction Permits (rank) 27 Protecting Minority Investors (rank) 13 Border compliance (USD) 212 Score of dealing with construction permits (0-100) 78.7 Score of protecting minority investors (0-100) 80.0 Time to export Procedures (number) 15 Extent of disclosure index (0-10) 8.0 Documentary compliance (hours) 20 Time (days) 106 Extent of director liability index (0-10) 7.0 Border compliance (hours) 65 Cost (% of warehouse value) 4.0 Ease of shareholder suits index (0-10) 7.0 Cost to export Building quality control index (0-15) 14.5 Extent of shareholder rights index (0-6) 6.0 Documentary compliance (USD) 100 Extent of ownership and control index (0-7) 6.0 Border compliance (USD) 266 Getting Electricity (rank) 22 Extent of corporate transparency index (0-7) 6.0 Score of getting electricity (0-100) 89.4 Enforcing Contracts (rank) 163 Procedures (number) 4 Paying Taxes (rank) 115 Score of enforcing contracts (0-100) 41.2 Time (days) 53 Score of paying taxes (0-100) 67.6 Time (days) 1,445 Cost (% of income per capita) 28.6 Payments (number per year) 11 Cost (% of claim value) 31.0 Reliability of supply and transparency of tariff index (0-8) 6 Time (hours per year) 252 Quality of judicial processes index (0-18) 10.5 Total tax and contribution rate (% of profit) 49.7 Registering Property (rank) 154 Postfiling index (0-100) 49.3 Resolving Insolvency (rank) 52 Score of registering property (0-100) 47.6 Score of resolving insolvency (0-100) 62.0 Procedures (number) 9 Recovery rate (cents on the dollar) 71.6 Time (days) 58 Time (years) 1.6 Cost (% of property value) 7.8 Cost (% of estate) 9.0 Quality of the land administration index (0-30) 10.8 Outcome (0 as piecemeal sale and 1 as going 1 concern) Strength of insolvency framework index (0-16) 7.5 Page 4 Doing Business 2020 India Starting a Business This topic measures the number of procedures, time, cost and paid-in minimum capital requirement for a small- to medium-sized limited liability company to start up and formally operate in each economy’s largest business city. To make the data comparable across 190 economies, Doing Business uses a standardized business that is 100% domestically owned, has start-up capital equivalent to 10 times the income per capita, engages in general industrial or commercial activities and employs between 10 and 50 people one month after the commencement of operations, all of whom are domestic nationals. Starting a Business considers two types of local limited liability companies that are identical in all aspects, except that one company is owned by 5 married women and the other by 5 married men. The ranking of economies on the ease of starting a business is determined by sorting their scores for starting a business. These scores are the simple average of the scores for each of the component indicators. The most recent round of data collection for the project was completed in May 2019. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally start and formally operate a company To make the data comparable across economies, several assumptions about the business and the (number) procedures are used. It is assumed that any required information is readily available and that the entrepreneur will pay no bribes. • Preregistration (for example, name verification or reservation, notarization) The business: • Registration in the economy’s largest business city -Is a limited liability company (or its legal equivalent). If there is more than one type of limited • Postregistration (for example, social security registration, liability company in the economy, the limited liability form most common among domestic firms is company seal) chosen. Information on the most common form is obtained from incorporation lawyers or the statistical office. • Obtaining approval from spouse to start a business or to leave -Operates in the economy’s largest business city. For 11 economies the data are also collected for the home to register the company the second largest business city. • Obtaining any gender specific document for company -Performs general industrial or commercial activities such as the production or sale to the public of registration and operation or national identification card goods or services. The business does not perform foreign trade activities and does not handle products subject to a special tax regime, for example, liquor or tobacco. It is not using heavily Time required to complete each procedure (calendar days) polluting production processes. • Does not include time spent gathering information -Does not qualify for investment incentives or any special benefits. -Is 100% domestically owned. • Each procedure starts on a separate day (2 procedures cannot -Has five business owners, none of whom is a legal entity. One business owner holds 30% of the start on the same day) company shares, two owners have 20% of shares each, and two owners have 15% of shares • Procedures fully completed online are recorded as ½ day each. -Is managed by one local director. • Procedure is considered completed once final document is received -Has between 10 and 50 employees one month after the commencement of operations, all of them domestic nationals. • No prior contact with officials -Has start-up capital of 10 times income per capita. -Has an estimated turnover of at least 100 times income per capita. Cost required to complete each procedure (% of income per -Leases the commercial plant or offices and is not a proprietor of real estate. capita) -Has an annual lease for the office space equivalent to one income per capita. • Official costs only, no bribes -Is in an office space of approximately 929 square meters (10,000 square feet). -Has a company deed that is 10 pages long. • No professional fees unless services required by law or commonly used in practice The owners: Paid-in minimum capital (% of income per capita) -Have reached the legal age of majority and are capable of making decisions as an adult. If there • Funds deposited in a bank or with third party before registration is no legal age of majority, they are assumed to be 30 years old. or up to 3 months after incorporation -Are in good health and have no criminal record. -Are married, the marriage is monogamous and registered with the authorities. -Where the answer differs according to the legal system applicable to the woman or man in question (as may be the case in economies where there is legal plurality), the answer used will be the one that applies to the majority of the population. Page 5 Doing Business 2020 India Starting a Business - Mumbai Standardized Company Legal form Private Limited Company Paid-in minimum capital requirement No minimum City Covered Mumbai Indicator Mumbai South Asia OECD high Best Regulatory income Performance Procedure – Men (number) 10 7.1 4.9 1 (2 Economies) Time – Men (days) 18 14.5 9.2 0.5 (New Zealand) Cost – Men (% of income per capita) 9.3 8.3 3.0 0.0 (2 Economies) Procedure – Women (number) 10 7.3 4.9 1 (2 Economies) Time – Women (days) 18 14.6 9.2 0.5 (New Zealand) Cost – Women (% of income per capita) 9.3 8.3 3.0 0.0 (2 Economies) Paid-in min. capital (% of income per capita) 0.0 0.2 7.6 0.0 (120 Economies) Figure – Starting a Business in Mumbai – Score 47.1 82.4 95.3 100.0 Procedures Time Cost Paid-in min. capital Figure – Starting a Business in Mumbai and comparator economies – Ranking and Score DB 2020 Starting a Business Score 0 100 94.1: China (Rank: 27) 89.3: Pakistan (Rank: 72) 86.1: Mexico (Rank: 107) 82.4: Bangladesh (Rank: 131) 82.0: Delhi 81.2: Mumbai Note: The ranking of economies on the ease of starting a business is determined by sorting their scores for starting a business. These scores are the simple average of the scores for each of the component indicators. Page 6 Doing Business 2020 India Figure – Starting a Business in Mumbai – Procedure, Time and Cost Time (days) Cost (% of income per capita) 18 4 16 3.5 Cost (% of income per capita) 14 3 12 Time (days) 2.5 10 2 8 1.5 6 1 4 2 0.5 0 0 1 2 *3 4 *5 6 7 *8 *9 * 10 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures reflected here, see the summary below. Page 7 Doing Business 2020 India Details – Starting a Business in Mumbai – Procedure, Time and Cost No. Procedures Time to Complete Associated Costs 1 Obtain a digital signature certificate 2 days INR 700 to INR 2,500 per Agency : Authorized private agency (Federal) Digital Signature The applicant must obtain a Class-II Digital Signature Certificate from a certification agency Certificate authorized by the Controller of Certification Agencies. These include private agencies like NIC, E- Mudhra, MTNL Trust line, to which company directors submit the prescribed application form along with notarized proof of identity and address. For obtaining DSC, along with the documents (i.e., Proof of Identity and Proof of Address), a verification video must be submitted by the applicant, stating the name, company name, mobile number, email and intention for applying for DSC. Upon submitting the online application, a hard copy of the form has to be submitted along with supporting documents to the authorized private agency. A Class-II Digital Signature Certificate can be obtained for either a period of 1 year or a period of 2 years, and then needs to be renewed for another 1 or 2 years upon payment of renewal fees. Each agency has its own fee structure, starting from INR 700. The cost will vary in accordance with the duration of the Digital Signature Certificate. Once the Digital Signature Certificate is obtained, the authorized personnel (directors/manager/secretary) are required to register the same with MCA for statutory e-filing. 2 Reserve the company name online through "Reserve Unique Name" system (RUN) 1-3 days INR 1,000 Agency : Registrar of Companies, Ministry of Corporate Affairs (Federal) The company first looks up the availability of a name on the MCA website (http://www.mca.gov.in/mcafoportal/showCheckCompanyName.do), and then goes on to create a new user account under the RUN link in the MCA website. Online service for reservation of name (RUN or "Reserve Unique Name") was introduced through the web service available on mca.gov.in. This service has replaced the Form INC-1 for name approval. The following are the fields to be entered in Web-based Application : - Entity Type: It is required to select the applicable option, i.e. New Company (Others) / Part I Company, Producer Company, Unlimited Company, Private (OPC), IFSC Company, Section 8 Company, Nidhi Company. - Corporate Identification Number (CIN): Only in case an Existing Company is applying for the Change in Name, it is required to enter its CIN. - Proposed Name: A Proposed Name option required to be entered here (the form allows to provide 2 names in the form). After entering a Name, MCA has provided Auto Check Facility to check the availability of the Name, accordingly the Applicant and enter the new Optional name, in case the Entity already registered with such proposed name and again has to make Auto Check. When the MCA System provides a Green Remark, Applicant can submit the Applicant with such name option for further Approval. - Comments: In this field, Applicant can provide the details related to the Proposed Company and activities including the Prior Approvals and TradeMark Registration Details, Resolution (for Existing Company / Foreign Subsidiary Registration). All applicable documents must be scanned in a single file to be attached to the Web-based Application. After providing the details in the fields and requisite attachments, Applicant can submit the Form Online with the prescribed fees. Name will be reserved only for 20 Days within which the Applicant and/or Promoters are required to file form with MCA-Concerned ROC with requisite documents as per the Incorporation Rules 2014 as per the Companies Act 2013. As of April 2016 companies can also complete the name reservation through the SPICe form. However, in practice, companies reserve the company name before completing the application for incorporation, as that way company name is confirmed and there is no ambiguity and no chance of SPICe form being rejected due to name rejection. 3 Prepare and notarize affidavit by each founder and proposed director 1 day, simultaneous INR 10 (stamp paper) + Agency : Notary INR 35 (notarizing) for Each founder and proposed director has to submit an affidavit confirming that he/she is not each affidavit convicted of any offence in connection with the promotion, formation or management of any company, or has not been found guilty of any fraud or misfeasance or of any breach of duty to any company during the preceding five years and that all the documents filed with the Registrar for registration of the company contain information that is correct and complete and true to the best of his knowledge and belief. A separate notarized affidavit is required for each person. As per the Companies Act Amendment 2017 (July 27, 2017), Section 7, the requirement for affidavit to be submitted as part of incorporation documents has been replaced with a requirement of declaration by the directors. However, in practice, companies continue submitting notarized affidavits. Page 8 Doing Business 2020 India 4 Pay stamp duties, file the SPICE form and obtain the certificate of incorporation, DIN, PAN 4 days Fee schedule for a and TAN company with paid-up Agency : Registrar of Companies, Ministry of Corporate Affairs (Federal) share capital below INR Pursuant to Section 7 (1) of the Companies Act, 2013 and pursuant to Rule 10, 12, 14 and 15 of 1,500,000: Companies (Incorporation) Rules, 2014, the following forms are required to be electronically filed - Electronic filing of the on the website of the Ministry of Corporate Affairs for incorporation purposes. Memorandum of Association (eMOA): none It is mandatory for private limited companies to complete the incorporation process using the - Electronic filing fee for SPICe Form (Form INC -32). Applications for director identification number (DIN), Permanent Account Number (PAN) and a Tax deduction and Collection Account Number (TAN) have been filing the Articles of integrated completely into the SPICe form. The particulars of maximum three directors can be association (eAOA): none mentioned in SPICe form and DIN may be allotted to maximum three proposed directors through - Electronic filing fee for this. If new directors are proposed for an existing company, then a separate DIN application can Form INC-32 SPICe: none be submitted. - Stamp duty: INR 100 - Stamp duty for Articles of SPICe eMoA (INC-33) and SPICe eAoA (INC-34) have to be uploaded as ‘Linked Forms’ to SPICe Association: INR 3,000 (INC-32). The documents submitted for SPICe need to be digitally signed by all directors. A digital (INR 500 for every signature of a witness is also required for eMoA and eAoA. 500,000 or part thereof) - Stamp duty for A consolidated challan gets generated at the time of filing SPICe(INC-32) which shall contain Memorandum of applicable fee towards: (i) Form Fee Association: INR 200 (ii) MoA - PAN application: INR 110 (iii) AoA (including 18% GST) (iv) PAN - TAN application: INR 65 (v) TAN (including 18% GST) Two re-submissions are permitted for the SPICe form. On approval of SPICe forms, the Certificate of Incorporation (CoI) is issued with PAN and TAN as allotted by the Income Tax Department. An electronic mail with Certificate of Incorporation(CoI) as an attachment along with PAN and TAN is also sent to the user. Finance Act, 2018 amended section 139A of the Income-tax Act, 1961 and removed the requirement of issuing PAN in the form of a laminated card. Companies with authorized share capital below INR 1,500,000 are not required to pay filing fees for eMoA and eAoA. 5 Make a company stamp 1 day, simultaneous INR 350-500 Agency : Authorized vendor (Private) As per the amendment to the Companies Act 2013, making a company seal is no longer a legal requirement. However, making a company rubber stamp is still commonly used in practice. The stamp is normally required to be affixed by a director upon signing on behalf of the company in order to file several applications relevant to business startup. This includes but is not limited to opening a bank account, application for registration with the Employee State Insurance Corporation (ESIC) and application for a company Permanent Account Numbers (PAN). 6 Open a bank account 3 days no charge Agency : Bank The bank account details must be provided by the company in various post-registration applications, such as registrations with GST. After incorporation, company can immediately apply for bank account opening using electronically provided CoI. Banks have introduced new KYC requirements, and request for multiple ID proofs as well as address proofs, which results in a longer than usual processing time for providing with bank account number. The common documents required for account opening include: • Certificate of Incorporation (CoI) • MoA & AoA • Communication address proof of company • Registered address proof of company (if different from communication address) • Board Resolution • ID Proof of authorized signatory • PAN card of company (now provided in CoI) Page 9 Doing Business 2020 India 7 Register with Office of Inspector, Mumbai Shops and Establishment Act 7 days, simultaneous INR 1,200 (registration Agency : Municipal Corporation of Greater Mumbai fee) + 3 times registration According to Section 7 of the Bombay Shops and Establishments Act, 1948, the establishment fee for Trade Refuse must be registered as follows: Charges (INR 3,600) - Under Section 7(4), the employer must register the establishment in the prescribed manner within 30 days of the date on which the establishment commences its work. - Under Section 7(1), the establishment must submit to the local shop inspector Form A and the prescribed fees for registering the establishment. Supporting documents must be attached, including a certified true copy of the company's PAN Card, TAN Allotment Letter, Certificate of Incorporation, Memorandum and Articles of Association, a list of company directors, their particulars and copies of their PAN Cards. - Under Section 7(2), after the statement in Form A and the prescribed fees are received and the correctness of the statement is satisfactorily audited, the certificate for the registration of the establishment is issued in Form D, according to the provisions of Rule 6 of the Maharashtra Shops and Establishments Rules of 1961. Since the amendments in the Maharashtra Shops & Establishment (Amendment) Rules, 2010, the Schedule for fees for registration & renewal of registration (as per Rule 5) is as follows: 0 employees: INR 120 1 to 5 employees: INR 360 6 to 10 employees: INR 720 11 to 20 employees: INR 1,200 21 to 50 employees: INR 2,400 51 to 100 employees: INR 4,200 101 or more: INR 5,400. In addition, an annual fee (three times the registration and renewal fees) is charged as trade refuse charges (TRC), under the Mumbai Municipal Corporation Act, 1888. 8 Obtain Goods and Service Tax (GST) Registration Number 4 days no charge Agency : Department of Goods and Services Tax, Government of Maharashtra GST Registration of a business with the tax authorities implies obtaining a unique, 15-digit Goods and Service Tax Identification Number (GSTIN) from the GST authorities so that all the operations of and the data relating to the business can be collected and correlated. Registration under the GST Act is mandatory if your aggregate annual PAN-based turnover exceeds INR 20,00,000 (Rupees Twenty Lakhs). However, in practice, for any operating business, a GST registration is done immediately after incorporation. To apply for a new registration, the following documents are required - PAN card/details of business - Valid and accessible e-mail ID and Mobile Number - Documentary proof of constitution of business - Documentary proof of promoters/partners - Documentary proof of principal place of business - Details of Authorised Signatories including photographs and proof of appointment - Details of Primary Authorised Signatory - Business bank account details - Valid Class II or Class III DSC of authorised signatory in case of companies and LLPs; valid Class II or Class III DSC or Aadhaar (for E-Sign option). A maximum of 10 Promoters/Partners/Directors can be added in the form. Passport photographs need to be uploaded of all the Promoters/Partners/Directors whose details you are adding in the application form. Further, each passport photograph must be in JPEG format and not more than 100 KB. The first step to the registration process is the application and verification of PAN number, and the subsequent issue of a Temporary Registration Number (TRN). The applicant then needs to submit an application in Part B of FORM GST REG-01, duly signed, along with documents specified. The application is forwarded to the proper officer who examines it and the accompanying documents and if found to be in order, approve the grant of registration to the applicant within three working days from the date of submission of application. The certificate of registration in FORM GST REG-06 showing the principal place of business and additional place(s) of business is then made available to the applicant on the Common Portal and a GSTIN is assigned in the following format: - two characters for the State code; - ten characters for the PAN or the Tax Deduction and Collection Account Number; - two characters for the entity code; and - one checksum character. Page 10 Doing Business 2020 India 9 Register with the Employees' Provident Fund Organization (EPFO) and the Employees' 1 day, simultaneous no charge State Insurance Corporation (ESIC) Agency : Shram Suvidha Portal of Ministry of Labour and Employment The Employees Provident Fund Organization (EPFO) is a statutory organization under the Ministry of Labor and Employment. The Employees Provident Funds & Miscellaneous Provisions Act, 1952 applies to an establishment, employing 20 or more persons and engaged in any of the 183 Industries and Classes of business establishments, throughout India excluding the State of Jammu and Kashmir. Furthermore, new companies are required to register with the Employees' State Insurance Corporation (ESIC). On April 30, 2017, an online registration was introduced the Shram Suvidha Portal combining the EPFO and ESIC registrations into one. However, it was not a preferred method for the majority since paper copies had still to be filed after the online registration. In April 1, 2018, the electronic registration process was further enhanced and it became the only option to register for ESIC and EPFO. EPFO & ESIC registration is now done on the same Shram Suvidha portal (https://registration.shramsuvidha.gov.in) and in one application. However, the website was reported to be quite slow and with numerous glitches during the registration process – fields not accepting information, the screen timing out, etc. As a result, although registration is done electronically, it can take a long time in practice. Register for Profession Tax Less than one day no charge 10 Agency : Sales Tax Department, Government of Maharashtra (online procedure) Professional Tax in Maharashtra is levied under Maharashtra State Tax on Professions, Trades, Callings and Employments Act, 1975. It is levied on Company, Firm, Proprietary Concern, Hindu Undivided Family (HUF), Society, Club, Association of Persons, Corporation or any other corporate body in Maharashtra. Professional Tax in Maharashtra for Organisations: An employer organization is required to get registered under the Profession Tax Act and obtain a Registration Certificate under which the payment in respect of taxes deducted from employees’ salaries can be made. Also as a firm, the organization is required to obtain Enrollment Certificate and pay Profession tax on its behalf. Delays in obtaining Enrollment or Registration Certificate are penalized at the rate of Rs. 2/- (Rupees Two) per Day. In case a false information regarding enrollment is provided, then the Penalty is 3 times of tax amount. The interest for non-payment / delayed payment of profession tax is 1.25% per month and the Maharashtra state authority can also impose a penalty of 10% of the amount of tax not paid/short paid/delayed. There are 2 types of Profession Tax payers: a) Profession Tax Enrollment Certificate (PTEC) : Any person engaged in Profession, Trade and Callings and falling under one or the other of the classes mentioned in the second column of Schedule I shall obtained PTEC b) Profession Tax Registration Certificate (PTRC) : Every employer who has employed even a single employee whose salary is above the prescribed limit for deducting Profession Tax shall obtain PTRC. All new companies must be first obtain a Profession Tax Registration Certificate. And then proceed to enroll all employees for a Profession Tax Enrollment Certificate for any of the employees who have never been employed (for employees who have been previously enrolled, there is no need to re-enroll). Takes place simultaneously with previous procedure. Page 11 Doing Business 2020 India Starting a Business - Delhi Standardized Company Legal form Private Limited Company Paid-in minimum capital requirement No minimum City Covered Delhi Indicator Delhi South Asia OECD high Best Regulatory income Performance Procedure – Men (number) 10 7.1 4.9 1 (2 Economies) Time – Men (days) 17 14.5 9.2 0.5 (New Zealand) Cost – Men (% of income per capita) 5.3 8.3 3.0 0.0 (2 Economies) Procedure – Women (number) 10 7.3 4.9 1 (2 Economies) Time – Women (days) 17 14.6 9.2 0.5 (New Zealand) Cost – Women (% of income per capita) 5.3 8.3 3.0 0.0 (2 Economies) Paid-in min. capital (% of income per capita) 0.0 0.2 7.6 0.0 (120 Economies) Figure – Starting a Business in Delhi – Score 47.1 83.4 97.4 100.0 Procedures Time Cost Paid-in min. capital Figure – Starting a Business in Delhi and comparator economies – Ranking and Score DB 2020 Starting a Business Score 0 100 94.1: China (Rank: 27) 89.3: Pakistan (Rank: 72) 86.1: Mexico (Rank: 107) 82.4: Bangladesh (Rank: 131) 82.0: Delhi 81.2: Mumbai Note: The ranking of economies on the ease of starting a business is determined by sorting their scores for starting a business. These scores are the simple average of the scores for each of the component indicators. Page 12 Doing Business 2020 India Figure – Starting a Business in Delhi – Procedure, Time and Cost Time (days) Cost (% of income per capita) 2.5 16 Cost (% of income per capita) 14 2 12 Time (days) 10 1.5 8 1 6 4 0.5 2 0 0 1 2 *3 4 *5 6 7 *8 9 * 10 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures reflected here, see the summary below. Page 13 Doing Business 2020 India Details – Starting a Business in Delhi – Procedure, Time and Cost No. Procedures Time to Complete Associated Costs 1 Obtain digital signature certificate online from private agency authorized by the Ministry of 2 days INR 700 to INR 2,500 per Corporate Affairs (National) Digital Signature Agency : Certified private agencies Certificate The applicant must obtain a Class-II Digital Signature Certificate from a certification agency authorized by the Controller of Certification Agencies. These include private agencies like NIC, E- Mudhra, MTNL Trust line, to which company directors submit the prescribed application form along with notarized proof of identity and address. For obtaining DSC, along with the documents (i.e., Proof of Identity and Proof of Address), a verification video must be submitted by the applicant, stating the name, company name, mobile number, email and intention for applying for DSC. Upon submitting the online application, a hard copy of the form has to be submitted along with supporting documents to the authorized private agency. A Class-II Digital Signature Certificate can be obtained for either a period of 1 year or a period of 2 years, and then needs to be renewed for another 1-2 years upon payment of renewal fees. Each agency has its own fee structure, starting from INR 700. The cost will vary in accordance with the duration of the Digital Signature Certificate. Once the Digital Signature Certificate is obtained, the authorized personnel (directors/manager/secretary) are required to register the same with MCA for statutory e-filing. 2 Reserve the company name online through "Reserve Unique Name" system (RUN) 1-3 days INR 1,000 Agency : Registrar of Companies (ROC) The company first looks up the availability of a name on the MCA website (http://www.mca.gov.in/mcafoportal/showCheckCompanyName.do), and then goes on to create a new user account under the RUN link in the MCA website. Online service for reservation of name (RUN or "Reserve Unique Name") was introduced through the web service available on mca.gov.in. This service has replaced the Form INC-1 for name approval. The following are the fields to be entered in Web-based Application : - Entity Type: It is required to select the applicable option, i.e. New Company (Others) / Part I Company, Producer Company, Unlimited Company, Private (OPC), IFSC Company, Section 8 Company, Nidhi Company. - Corporate Identification Number (CIN): Only in case an Existing Company is applying for the Change in Name, it is required to enter its CIN. - Proposed Name: A Proposed Name option required to be entered here (the form allows to provide 2 names in the form). After entering a Name, MCA has provided Auto Check Facility to check the availability of the Name, accordingly the Applicant and enter the new Optional name, in case the Entity already registered with such proposed name and again has to make Auto Check. When the MCA System provides a Green Remark, Applicant can submit the Applicant with such name option for further Approval. - Comments: In this field, Applicant can provide the details related to the Proposed Company and activities including the Prior Approvals and TradeMark Registration Details, Resolution (for Existing Company / Foreign Subsidiary Registration). All applicable documents must be scanned in a single file to be attached to the Web-based Application. After providing the details in the fields and requisite attachments, Applicant can submit the Form Online with the prescribed fees. Name will be reserved only for 20 Days within which the Applicant and/or Promoters are required to file form with MCA-Concerned ROC with requisite documents as per the Incorporation Rules 2014 as per the Companies Act 2013. As of April 2016 companies can also complete the name reservation through the SPICe form. However, in practice, companies reserve the company name before completing the application for incorporation, as that way company name is confirmed and there is no ambiguity and no chance of SPICe form being rejected due to name rejection. 3 Prepare and notarize affidavit by each founder and proposed director 1 day, simultaneous INR 10 (stamp paper) + Agency : Notary INR 35 (notarizing) for Each founder and proposed director has to submit an affidavit confirming that he/she is not each affidavit convicted of any offence in connection with the promotion, formation or management of any company, or has not been found guilty of any fraud or misfeasance or of any breach of duty to any company during the preceding five years and that all the documents filed with the Registrar for registration of the company contain information that is correct and complete and true to the best of his knowledge and belief. A separate notarized affidavit is required for each person. As per the Companies Act Amendment 2017 (July 27, 2017), Section 7, the requirement for affidavit to be submitted as part of incorporation documents has been replaced with a requirement of declaration by the directors. However, in practice, companies continue submitting notarized affidavits. Page 14 Doing Business 2020 India 4 Pay stamp duties, file the SPICE form and obtain the certificate of incorporation, DIN, PAN 4 days Fee schedule for a and TAN company with paid-up Agency : Registrar of Companies (ROC) share capital below INR Pursuant to Section 7 (1) of the Companies Act, 2013 and pursuant to Rule 10, 12, 14 and 15 of 1,500,000: Companies (Incorporation) Rules, 2014, the following forms are required to be electronically filed - Electronic filing of the on the website of the Ministry of Corporate Affairs for incorporation purposes. Memorandum of Association (eMOA): none It is mandatory for private limited companies to complete the incorporation process using the - Electronic filing fee for SPICe Form (Form INC -32). Applications for director identification number (DIN), Permanent Account Number (PAN) and a Tax deduction and Collection Account Number (TAN) have been filing the Articles of integrated completely into the SPICe form. The particulars of maximum three directors can be association (eAOA): none mentioned in SPICe form and DIN may be allotted to maximum three proposed directors through - Electronic filing fee for this. If new directors are proposed for an existing company, then a separate DIN application can Form INC-32 SPICe: none be submitted. - Stamp duty: INR 10 - Stamp duty for Articles of SPICe eMoA (INC-33) and SPICe eAoA (INC-34) have to be uploaded as ‘Linked Forms’ to SPICe Association: INR 1,703 (INC-32). The documents submitted for SPICe need to be digitally signed by all directors (0.15% of capital) - Stamp duty for A consolidated challan gets generated at the time of filing SPICe(INC-32) which shall contain Memorandum of applicable fee towards: Association: INR 200 (i) Form Fee (ii) MoA - PAN application: INR 110 (iii) AoA (including 18% GST) (iv) PAN - TAN application: INR 65 (v) TAN (including 18% GST) Two re-submissions are permitted for the SPICe form. On approval of SPICe forms, the Certificate of Incorporation (CoI) is issued with PAN and TAN as allotted by the Income Tax Department. An electronic mail with Certificate of Incorporation(CoI) as an attachment along with PAN and TAN is also sent to the user. Finance Act, 2018 amended section 139A of the Income-tax Act, 1961 and removed the requirement of issuing PAN in the form of a laminated card. 5 Make a company stamp 1 day, simultaneous INR 500-1,000 Agency : Authorized vendor (Private) As per the amendment to the Companies Act 2013, making a company seal is no longer a legal requirement. However, making a company rubber stamp is still widely used in practice. The stamp is normally required to be affixed by a director upon signing on behalf of the company in order to file several applications relevant to business startup. A seal is also required in order to open a bank account. 6 Open a bank account 3 days no charge Agency : Bank The bank account details must be provided by the company in various post-registration applications, such as registrations with GST. After incorporation, company can immediately apply for bank account opening using electronically provided CoI. Banks have introduced new KYC requirements, and request for multiple ID proofs as well as address proofs, which results in a longer than usual processing time for providing with bank account number. The common documents required for account opening include: • Certificate of Incorporation (CoI) • MoA & AoA • Communication address proof of company • Registered address proof of company (if different from communication address) • Board Resolution • ID Proof of authorized signatory • PAN card of company (now provided in CoI) Page 15 Doing Business 2020 India 7 Obtain Goods and Service Tax (GST) Registration Number 3 days no charge Agency : Department of Trade and Taxes, Government of NCT of Delhi GST Registration of a business with the tax authorities implies obtaining a unique, 15-digit Goods and Service Tax Identification Number (GSTIN) from the GST authorities so that all the operations of and the data relating to the business can be collected and correlated. Registration under the GST Act is mandatory if your aggregate annual PAN-based turnover exceeds INR 20,00,000 (Rupees Twenty Lakhs). However, in practice, for any operating business, a GST registration is done immediately after incorporation. To apply for a new registration, the following documents are required - PAN card/details of business - Valid and accessible e-mail ID and Mobile Number - Documentary proof of constitution of business - Documentary proof of promoters/partners - Documentary proof of principal place of business - Details of Authorised Signatories including photographs and proof of appointment - Details of Primary Authorised Signatory - Business bank account details - Valid Class II or Class III DSC of authorised signatory in case of companies and LLPs; valid Class II or Class III DSC or Aadhaar (for E-Sign option). A maximum of 10 Promoters/Partners/Directors can be added in the form. Passport photographs need to be uploaded of all the Promoters/Partners/Directors whose details you are adding in the application form. Further, each passport photograph must be in JPEG format and not more than 100 KB. The first step to the registration process is the application and verification of PAN number, and the subsequent issue of a Temporary Registration Number (TRN). The applicant then needs to submit an application in Part B of FORM GST REG-01, duly signed, along with documents specified. The application is forwarded to the proper officer who examines it and the accompanying documents and if found to be in order, approve the grant of registration to the applicant within three working days from the date of submission of application. The certificate of registration in FORM GST REG-06 showing the principal place of business and additional place(s) of business is then made available to the applicant on the Common Portal and a GSTIN is assigned in the following format: - two characters for the State code; - ten characters for the PAN or the Tax Deduction and Collection Account Number; - two characters for the entity code; and - one checksum character. 8 Register with the Employees' Provident Fund Organization (EPFO) and the Employees' 1 day, simultaneous no charge State Insurance Corporation (ESIC) Agency : Shram Suvidha Portal of Ministry of Labour and Employment The Employees Provident Fund Organization (EPFO) is a statutory organization under the Ministry of Labor and Employment. The Employees Provident Funds & Miscellaneous Provisions Act, 1952 applies to an establishment, employing 20 or more persons and engaged in any of the 183 Industries and Classes of business establishments, throughout India excluding the State of Jammu and Kashmir. Furthermore, new companies are required to register with the Employees' State Insurance Corporation (ESIC). On April 30, 2017, an online registration was introduced the Shram Suvidha Portal combining the EPFO and ESIC registrations into one. However, it was not a preferred method for the majority since paper copies had still to be filed after the online registration. In April 1, 2018, the electronic registration process was further enhanced and it became the only option to register for ESIC and EPFO. EPFO & ESIC registration is now done on the same Shram Suvidha portal (https://registration.shramsuvidha.gov.in) and in one application. However, the website was reported to be quite slow and with numerous glitches during the registration process – fields not accepting information, the screen timing out, etc. As a result, although registration is done electronically, it can take a long time in practice. 9 Visit EPFO to obtain approval of registration 3 days no charge Agency : Employees' Provident Fund Organization After online registration for EPFO, company visits the assistant labor commission in EPFO in order to obtain approval for registration. This is a common practice in Delhi. In some cases, several visits might be required prior the approval is provided. Register online under the Delhi Shops and Establishments Act Less than one day no charge 10 Agency : Department of Labor - Government of NCT of Delhi (online procedure), Under the Delhi Shops and Establishments Act 1954, the company shall send to the Chief simultaneous Inspector a statement in prescribed form A containing: (a) the name of the employer and the manager (b) the postal address of the establishment (c) the name of the establishment, (d) the category of the establishment, i.e. whether it is a shop/commercial establishment (e) the number of employees working in the establishment; and (f) such other particulars as may be prescribed. Upon receipt of the statement, a registration certificate will be generated online instantly. Page 16 Doing Business 2020 India Takes place simultaneously with previous procedure. Page 17 Doing Business 2020 India Dealing with Construction Permits This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required notifications, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality of building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional certification requirements. The most recent round of data collection was completed in May 2019. See the methodology for more information What the indicators measure Case study assumptions Procedures to legally build a warehouse (number) To make the data comparable across economies, several assumptions about the construction company, the warehouse project and the utility connections are used. • Submitting all relevant documents and obtaining all necessary clearances, licenses, permits and certificates The construction company (BuildCo): • Submitting all required notifications and receiving all necessary - Is a limited liability company (or its legal equivalent) and operates in the economy’s largest inspections business city. For 11 economies the data are also collected for the second largest business city. • Obtaining utility connections for water and sewerage - Is 100% domestically and privately owned; has five owners, none of whom is a legal entity. Has a licensed architect and a licensed engineer, both registered with the local association of architects • Registering and selling the warehouse after its completion or engineers. BuildCo is not assumed to have any other employees who are technical or licensed Time required to complete each procedure (calendar days) experts, such as geological or topographical experts. - Owns the land on which the warehouse will be built and will sell the warehouse upon its • Does not include time spent gathering information completion. • Each procedure starts on a separate day—though procedures that can be fully completed online are an exception to this rule The warehouse: • Procedure is considered completed once final document is - Will be used for general storage activities, such as storage of books or stationery. received - Will have two stories, both above ground, with a total constructed area of approximately 1,300.6 square meters (14,000 square feet). Each floor will be 3 meters (9 feet, 10 inches) high and will be • No prior contact with officials located on a land plot of approximately 929 square meters (10,000 square feet) that is 100% owned by BuildCo, and the warehouse is valued at 50 times income per capita. Cost required to complete each procedure (% of income per - Will have complete architectural and technical plans prepared by a licensed architect. If capita) preparation of the plans requires such steps as obtaining further documentation or getting prior • Official costs only, no bribes approvals from external agencies, these are counted as procedures. - Will take 30 weeks to construct (excluding all delays due to administrative and regulatory Building quality control index (0-15) requirements). • Quality of building regulations (0-2) The water and sewerage connections: • Quality control before construction (0-1) - Will be 150 meters (492 feet) from the existing water source and sewer tap. If there is no water • Quality control during construction (0-3) delivery infrastructure in the economy, a borehole will be dug. If there is no sewerage • Quality control after construction (0-3) infrastructure, a septic tank in the smallest size available will be installed or built. - Will have an average water use of 662 liters (175 gallons) a day and an average wastewater flow • Liability and insurance regimes (0-2) of 568 liters (150 gallons) a day. Will have a peak water use of 1,325 liters (350 gallons) a day and • Professional certifications (0-4) a peak wastewater flow of 1,136 liters (300 gallons) a day. - Will have a constant level of water demand and wastewater flow throughout the year; will be 1 inch in diameter for the water connection and 4 inches in diameter for the sewerage connection. Page 18 Doing Business 2020 India Dealing with Construction Permits - Mumbai Standardized Warehouse Estimated value of warehouse INR 6,968,643.60 City Covered Mumbai Indicator Mumbai South Asia OECD high Best Regulatory income Performance Procedures (number) 19 14.6 12.7 None in 2018/19 Time (days) 98 149.7 152.3 None in 2018/19 Cost (% of warehouse value) 5.4 12.5 1.5 None in 2018/19 Building quality control index (0-15) 14.0 9.4 11.6 15.0 (6 Economies) Figure – Dealing with Construction Permits in Mumbai – Score 44.0 79.3 72.9 93.3 Procedures Time Cost Building quality control index Figure – Dealing with Construction Permits in Mumbai and comparator economies – Ranking and Score DB 2020 Dealing with Construction Permits Score 0 100 84.2: Delhi 77.3: China (Rank: 33) 72.4: Mumbai 68.8: Mexico (Rank: 93) 66.5: Pakistan (Rank: 112) 61.1: Bangladesh (Rank: 135) Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their scores for dealing with construction permits. These scores are the simple average of the scores for each of the component indicators. Page 19 Doing Business 2020 India Figure – Dealing with Construction Permits in Mumbai – Procedure, Time and Cost Time (days) Cost (% of warehouse value) 2.5 Cost (% of warehouse value) 80 2 Time (days) 60 1.5 40 1 20 0.5 0 0 1 *2 3 4 5 6 7 8 9 10 11 12 * 13 14 * 15 * 16 17 18 19 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures reflected here, see the summary below. Page 20 Doing Business 2020 India Figure – Dealing with Construction Permits in Mumbai and comparator economies – Measure of Quality 16 15.0 15.0 14.0 14 13.0 11.7 12 Index score 10.0 10 9.4 8 6 4 2 0 Mumbai Bangladesh China Mexico Pakistan Delhi South Asia Details – Dealing with Construction Permits in Mumbai – Procedure, Time and Cost No. Procedures Time to Complete Associated Costs 1 Obtain latest Property Register Card (P.R. Card) in words from the Revenue Department 10 days INR 60 Agency : Revenue Department The Property Register Card (P.R. Card) is a record showing the (i) Land ownership details; (ii) historical ownership details; (iii) City Title Survey Number (CTS); (iv) Plot Number; (v) area of the land; (vi) records of encumberances and mutations of the holdings held by the Revenue Department about the Building Land/Plot. This P.R. Card is a mandatory document to be provided to the MCGM when applying for a Building Permit. The Application for the P.R. Card is made to the City Survey Officer (An Officer of the Revenue Department) by affixing a Rs.10 Court Fee Stamp. 2 Obtain latest authenticated City Title Survey (CTS) Plan 7 days no charge Agency : Collector's Office (Revenue Records Department) The latest copy of the City Title Survey (CTS) Plan need to be obtained from Collector's office (Revenue Records Department), and has to be certified by Land Records Officer as an authentic document. This is required as MCGM needs to be certain that there have been no changes to existing boundaries or structures since the original CTS plan was issued. 3 Submit application and design plans and pay scrutiny fee 0.5 days INR 26,385 Agency : Building Proposal Office, Municipal Corporation of Greater Mumbai BuildCo submits an online application Common Application Form of Online Building Plan Approval System (OBPS) - alongwith all requisite documents and PreDCR drawings of proposed work at http://autodcr.mcgm.gov.in. After uploading the drawings and essential documents, on payment of scrutiny fees online the file/application will be accepted online by MCGM. The concerned officer at the zonal building proposal office will scrutinize the proposal and essential documents as per procedure. If all documents are in order and the file is complete, BuildCo can proceed to pay the scrutiny fees online in the portal. No-Objection Certificates (NOCs) for various agencies, including Stormwater and Drain Department, Sewerage Department, Hydraulic Engineer Department, Roads and Traffic Department are obtained through the OBPS. Uploaded PreDCR drawings will run through AutoDCR software for the verification of consumed FSI in the proposal and to check if the various parameters of the proposed building are in consonance with the provisions of DCR and policies in force. The building proposal office will submit the file to the competent authority online for approval of required concessions, if any. On receipt of approval to the concessions, the IOD will be given at Zonal EE(BP). 4 Obtain no-objection certifcates (NOC) from various agencies 21 days no charge Agency : Building Proposal Office, Municipal Corporation of Greater Mumbai Once the application is submitted through the Online Building Plan Approval System (OBPS) portal, the various agencies selected in the application who need to provide no objection certificates review the proposal, and provide their NOCs in the portal. 5 Hire licensed fire safety consultant to obtain certification for Fire NOC 1 day INR 100,000 Agency : Private consultant BuildCo needs to hire a licensed fire safety consultant who prepares the Building Details Form 2 (for Active Fire Safety Measures) and at completion prepares the Form A along with its Annexure about installation of all fire-fighting requirements / installations stipulated by the Mumbai Fire Brigade. 6 Obtain Intimation of Disapproval and pay fees 29 days INR 4,200 Agency : Building Proposal Office, Municipal Corporation of Greater Mumbai Intimation of Disapproval (IOD) is granted as per the provisions of Section 346 of MMC Act 1888. The IOD includes various conditions to be complied before requesting for further approvals. Upon submission of online application through CAF, the IOD is issued within 29 days. 7 Obtain excavation permission 7 days INR 40,000 Agency : Office of the Collector, Mumbai/Suburban District Excavation permission needs to be obtained from Office of Collector. This permit is a requirement for the Construction and Debris Management Plan to be submitted by BuildCo to municipality. The cost of the permit depends on the amount of soil being excavated. Page 21 Doing Business 2020 India 8 Obtain plinth commencement certificate and pay development charges 0.5 days INR 149,708 Agency : Building Proposal Office, Municipal Corporation of Greater Mumbai Once IOD has been issued, the applicant may submit a request for the commencement certificate on the Online Building Building Approval System (OBPS) portal. The documents and NOC submitted by the applicants are verified on the portal by the staff (Licesnsed Engineer, Sub- Engineer, Assistant Engineer, Executive Engineer) and the necessary commencement certificate is issued through the portal. After payment of development charges and other applicable premium the commencement certificate is issued within 7 days. 9 Request and receive inspection of plinth 1 day no charge Agency : Building Proposal Office, Municipal Corporation of Greater Mumbai 10 Request and obtain further commencement certificate 7 days no charge Agency : Building Proposal Office, Municipal Corporation of Greater Mumbai The building permit is done in 2 steps. First, BuildCo must obtain the permit up to the plinth level. Once the plinth level has been completed, there is an inspection to verify that is in compliance with approved plans. It is only after this inspection has been done and approval obtained that the BuildCo can move on with the construction and start the superstructure of the warehouse. But in order to do so, it is necessary to obtain a permit to start building the superstructure. 11 Request completion NOCs from various agencies through the Common Completion 0.5 days no charge Request Form (CCRF) Agency : Chief Fire Office, Municipal Corporation of Greater Mumbai 12 Receive inspection from Storm Water and Drain Department 1 day no charge Agency : Storm Water and Drain Department, Municipal Corporation of Greater Mumbai The Assistant Engineer of the Municipal Corporation makes the inspection. There are two inspections: one before the connections are completed and another after completion. The inspection would not take more than a day. An officer of the Municipal Corporation inspects the premises and prepares a report on the connection. Receive inspection from Sewerage Department 1 day no charge 13 Agency : Sewerage Department, Municipal Corporation of Greater Mumbai 14 Obtain water connection from Hydraulic Engineer 3 days no charge Agency : Hydraulic Engineer Department, Municipal Corporation of Greater Mumbai Receive inspection from Roads & Traffic Department 1 day no charge 15 Agency : Roads &Traffic Department, Municipal Corporation of Greater Mumbai Receive inspection from Chief Fire Office 1 day no charge 16 Agency : Chief Fire Office, Municipal Corporation of Greater Mumbai 17 Submit letter stating completion of building works to obtain an occupancy certificate and 0.5 days no charge certificate of completion Agency : Building Proposal Office, Municipal Corporation of Greater Mumbai The owner, through a licensed plumber, shall furnish a drainage completion certificate to certify that the works were completed according to approved drainage plans. The licensed surveyor, engineer, or architect who has supervised the construction shall furnish a building completion certificate to certify that the building has not deviated from the approval plans. These certifications are submitted online through the portal. Following the reception of both certificates of completion MCGM shall inspect the work, and after satisfying that there is no deviation from the approved plans, issue a certificate of acceptance of the completion of the work. 18 Receive final inspection from Building Proposal Office 1 day no charge Agency : Building Proposal Office, Municipal Corporation of Greater Mumbai 19 Obtain Completion and Occupancy Certificate from online portal 14 days INR 57,713 Agency : Building Proposal Office, Municipal Corporation of Greater Mumbai Once the final inspection has been concluded and the final plans are stamped by the Building Proposal Office, the combined Completion certificate and Occupancy certificate are issued. The final stamped plans by the Building Proposal Office and a copy of the Completion and Occupancy certificate are forwarded to the Hydraulic Engineer (Water) Department. Fees for water connection include: • Water connection charges: INR 1,060.00 • Water meter: INR 150.00 • Refundable security deposit towards water charges bills at INR 25.00 per 1,000 liter + 60% of sewerage charges for the requirement of the building Sewer fees are INR 50,000 Takes place simultaneously with previous procedure. Page 22 Doing Business 2020 India Details – Dealing with Construction Permits in Mumbai – Measure of Quality Answer Score Building quality control index (0-15) 14.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; Free 1.0 of charge. Which requirements for obtaining a building permit are clearly specified in the building regulations or on any List of required 1.0 accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in compliance with existing Licensed architect; 1.0 building regulations? (0-1) Licensed engineer. Quality control during construction index (0-3) 2.0 What types of inspections (if any) are required by law to be carried out during construction? (0-2) Inspections by in- 1.0 house engineer; Inspections at various phases. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 3.0 Is there a final inspection required by law to verify that the building was built in accordance with the approved Yes, final inspection 2.0 plans and regulations? (0-2) is done by government agency; Yes, in-house engineer submits report for final inspection. Do legally mandated final inspections occur in practice? (0-1) Final inspection 1.0 always occurs in practice. Liability and insurance regimes index (0-2) 2.0 Which parties (if any) are held liable by law for structural flaws or problems in the building once it is in use Architect or engineer; 1.0 (Latent Defect Liability or Decennial Liability)? (0-1) Professional in charge of the supervision; Construction company; Owner or investor. Which parties (if any) are required by law to obtain an insurance policy to cover possible structural flaws or Architect or engineer; 1.0 problems in the building once it is in use (Latent Defect Liability Insurance or Decennial Insurance)? (0-1) Professional in charge of the supervision; Construction company. Professional certifications index (0-4) 4.0 What are the qualification requirements for the professional responsible for verifying that the architectural plans Minimum number of 2.0 or drawings are in compliance with existing building regulations? (0-2) years of experience; University degree in architecture or engineering; Being a registered architect or engineer. Page 23 Doing Business 2020 India What are the qualification requirements for the professional who supervises the construction on the ground? (0- Minimum number of 2.0 2) years of experience; University degree in engineering, construction or construction management; Being a registered architect or engineer. Page 24 Doing Business 2020 India Dealing with Construction Permits - Delhi Standardized Warehouse Estimated value of warehouse INR 6,968,643.60 City Covered Delhi Indicator Delhi South Asia OECD high Best Regulatory income Performance Procedures (number) 11 14.6 12.7 None in 2018/19 Time (days) 113.5 149.7 152.3 None in 2018/19 Cost (% of warehouse value) 2.8 12.5 1.5 None in 2018/19 Building quality control index (0-15) 15.0 9.4 11.6 15.0 (6 Economies) Figure – Dealing with Construction Permits in Delhi – Score 76.0 74.8 86.2 100.0 Procedures Time Cost Building quality control index Figure – Dealing with Construction Permits in Delhi and comparator economies – Ranking and Score DB 2020 Dealing with Construction Permits Score 0 100 84.2: Delhi 77.3: China (Rank: 33) 72.4: Mumbai 68.8: Mexico (Rank: 93) 66.5: Pakistan (Rank: 112) 61.1: Bangladesh (Rank: 135) Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their scores for dealing with construction permits. These scores are the simple average of the scores for each of the component indicators. Page 25 Doing Business 2020 India Figure – Dealing with Construction Permits in Delhi – Procedure, Time and Cost Time (days) Cost (% of warehouse value) 1.8 100 1.6 Cost (% of warehouse value) 1.4 80 1.2 Time (days) 1 60 0.8 40 0.6 0.4 20 0.2 0 0 1 2 3 4 5 6 7 8 9 10 11 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures reflected here, see the summary below. Page 26 Doing Business 2020 India Figure – Dealing with Construction Permits in Delhi and comparator economies – Measure of Quality 16 15.0 15.0 14.0 14 13.0 11.7 12 Index score 10.0 10 9.4 8 6 4 2 0 Delhi Bangladesh China Mexico Pakistan Mumbai South Asia Details – Dealing with Construction Permits in Delhi – Procedure, Time and Cost No. Procedures Time to Complete Associated Costs 1 Submit online Common Application Form along with requisite building permit fees and 0.5 days INR 3,601 drawings Agency : Municipal Corporation of Delhi BuildCo applies for the sanction of the building plans online through the Common Application Form by submitting the following documents: 1. Building plan (Site plan, set back, architectural plans) 2. Proof of ownership 3. Specifications of the proposed construction 4. Supervision certificate signed by the licensed architect/engineer, supervisor and plumber; 5. Structural-stability Certificate signed by the licensed architect/engineer along with a copy of registration certificate 6. Rain Water-Harvesting Certificate in case of plot size more than 100 square meters signed by the licensed architect and owner 7. No Nuisance/Construction Debris Certificate signed by the owner 8.Latest property tax receipt All the plans must be signed by the licensed architect/engineer and owner registered with the Council of Architects/Institution of Engineers and shall indicate their names, addresses, license and enrollment numbers. 2 Request and obtain release of building sanction plans 30 days INR 76,689 Agency : Municipal Corporation of Delhi The application submit the proposal through the Common Application Form (CAF), and the no objection certificates required for various agencies are marked on the CAF. The concerned officers from the various departments receive the proposal request for NOCs through the online portal, and provide their clearance online as well. Once the NOCs are obtained, the plans go through three levels of approvals, the sub-engineer, assistant engineer, and then the Chief Architect/Engineer, who sanctions/approves the plans. The approved plans go back to the sub- engineer, who releases the building sanction plan. 3 Submit online notice of completion up to the plinth level online 0.5 days no charge Agency : Municipal Corporation of Delhi BuildCo must notify the MCD of the completion of the plinth level. MCD inspects the construction and submits any objections, if necessary. Mandatory inspections are carried out at two stages: at plinth level and at completion. Routine inspections may be carried in between and the Municipal Corporation of Delhi reserves the right to inspect the premises before, during and after the construction. 4 Request and receive inspection at the plinth level 1 day INR 15 Agency : Municipal Corporation of Delhi BuildCo must notify the MCD of the completion of the plinth level,. MCD inspects the construction and submits any objections, if necessary. Mandatory inspections are carried out at two stages: at plinth level and at completion. Routine inspections may be carried in between and the Municipal Corporation of Delhi reserves the right to inspect the premises before, during and after the construction. 5 Obtain online approval of the plinth completion and and further continuation 14 days no charge Agency : Municipal Corporation of Delhi This certificate certifies that the construction has reached the plinth level and that it has been inspected and the construction can continue with the superstructure. Page 27 Doing Business 2020 India 6 Submit notice of completion and request final inspection 0.5 days INR 2,601 Agency : Municipal Corporation of Delhi The building company must submit a notice of completion through the licensed architect/engineer or supervisor who has supervised the construction attaching the following documents: 1. Lease-deed/sale deed 2. Completion plan 3. Photographs taken from different angles so as to show the overall view of the building 4. Original sanctioned building plan 5. Water Connection Sanction and Sewerage Connection Sanction from Delhi Jal Board 6. Structural-stability Certificate signed by the licensed architect/engineer along with the structural drawings 7. Certificate of licensed architect/engineer or supervisor 8. Extension of time from the lessor if required 9. Rain Water-Harvesting Certificate in case of plot size more than 100 square meters signed by the licensed architect and owner 10. Affidavit/Undertaking of licensed architect/engineer or supervisor (as the case may be) 11. Affidavit of owner 12. A statement indicating deviations that are carried out and compounding fee payable 7 Receive final inspection of the construction 1 day no charge Agency : Municipal Corporation of Delhi In practice this can take up to one week. 8 Receive site inspection from the Fire Department 1 day no charge Agency : Fire Department Once request for NOC from Fire Department is submitted online, an inspection is conducted. The completion certificate can only be released once the NOC from Chief Fire Officer is obtained. 9 Obtain completion/occupancy permit 30 days no charge Agency : Municipal Corporation of Delhi 10 Request water and sewer connection approval 1 day INR 109,800 Agency : Delhi Jal Board The building company must submit water and sewer connection application forms. Documents to be attached: (1) Proof of identity document: photocopy of voter ID card, ration card, PAN card, driving license or post card (2) Property ownership document: photocopy of GPA, allotment letter, government allotment letter, sale deed or NOC from landlord (3) Proof of residence: photocopy of driving license, passport, election I card (4) Sanction of Water Supply Scheme It is compulsory to provide the document number of the attached documents. Delhi Jal Board has integrated the process of obtaining an Excavation Permit from Municipal Corporation of Delhi by charging a road restoration charges for water and sewer connections on behalf of MCD. 11 Receive on-site inspection for water and sewer connection and receive approval 34 days no charge Agency : Delhi Jal Board An inspection of the site will be performed by a Survey Officer. Takes place simultaneously with previous procedure. Page 28 Doing Business 2020 India Details – Dealing with Construction Permits in Delhi – Measure of Quality Answer Score Building quality control index (0-15) 15.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; Free 1.0 of charge. Which requirements for obtaining a building permit are clearly specified in the building regulations or on any List of required 1.0 accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in compliance with existing Licensed architect; 1.0 building regulations? (0-1) Licensed engineer. Quality control during construction index (0-3) 3.0 What types of inspections (if any) are required by law to be carried out during construction? (0-2) Inspections by in- 2.0 house engineer; Inspections at various phases; Risk-based inspections. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 3.0 Is there a final inspection required by law to verify that the building was built in accordance with the approved Yes, final inspection 2.0 plans and regulations? (0-2) is done by government agency; Yes, in-house engineer submits report for final inspection. Do legally mandated final inspections occur in practice? (0-1) Final inspection 1.0 always occurs in practice. Liability and insurance regimes index (0-2) 2.0 Which parties (if any) are held liable by law for structural flaws or problems in the building once it is in use Architect or engineer; 1.0 (Latent Defect Liability or Decennial Liability)? (0-1) Professional in charge of the supervision; Construction company. Which parties (if any) are required by law to obtain an insurance policy to cover possible structural flaws or Architect or engineer; 1.0 problems in the building once it is in use (Latent Defect Liability Insurance or Decennial Insurance)? (0-1) Professional in charge of the supervision; Construction company. Professional certifications index (0-4) 4.0 What are the qualification requirements for the professional responsible for verifying that the architectural plans Minimum number of 2.0 or drawings are in compliance with existing building regulations? (0-2) years of experience; University degree in architecture or engineering; Being a registered architect or engineer. Page 29 Doing Business 2020 India What are the qualification requirements for the professional who supervises the construction on the ground? (0- Minimum number of 2.0 2) years of experience; University degree in engineering, construction or construction management; Being a registered architect or engineer; There are no specific requirements. Page 30 Doing Business 2020 India Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tariffs index measures reliability of supply, transparency of tariffs and the price of electricity. The most recent round of data collection for the project was completed in May 2019. See the methodology for more information. What the indicators measure Case study assumptions Procedures to obtain an electricity connection (number) To make the data comparable across economies, several assumptions about the warehouse, the electricity connection and the monthly consumption are used. • Submitting all relevant documents and obtaining all necessary clearances and permits The warehouse: • Completing all required notifications and receiving all necessary - Is owned by a local entrepreneur and is used for storage of goods. inspections - Is located in the economy’s largest business city. For 11 economies the data are also collected for • Obtaining external installation works and possibly purchasing the second largest business city. material for these works - Is located in an area where similar warehouses are typically located and is in an area with no physical constraints. For example, the property is not near a railway. • Concluding any necessary supply contract and obtaining final supply - Is a new construction and is being connected to electricity for the first time. - Has two stories with a total surface area of approximately 1,300.6 square meters (14,000 square Time required to complete each procedure (calendar days) feet). The plot of land on which it is built is 929 square meters (10,000 square feet). • Is at least 1 calendar day The electricity connection: • Each procedure starts on a separate day - Is a permanent one with a three-phase, four-wire Y connection with a subscribed capacity of 140- • Does not include time spent gathering information kilo-volt-ampere (kVA) with a power factor of 1, when 1 kVA = 1 kilowatt (kW). - Has a length of 150 meters. The connection is to either the low- or medium-voltage distribution • Reflects the time spent in practice, with little follow-up and no network and is either overhead or underground, whichever is more common in the area where the prior contact with officials warehouse is located and requires works that involve the crossing of a 10-meter road (such as by excavation or overhead lines) but are all carried out on public land. There is no crossing of other Cost required to complete each procedure (% of income per owners’ private property because the warehouse has access to a road. capita) - Does not require work to install the internal wiring of the warehouse. This has already been • Official costs only, no bribes completed up to and including the customer’s service panel or switchboard and the meter base. • Value added tax excluded The monthly consumption: The reliability of supply and transparency of tariffs index (0-8) - It is assumed that the warehouse operates 30 days a month from 9:00 a.m. to 5:00 p.m. (8 hours • Duration and frequency of power outages (0–3) a day), with equipment utilized at 80% of capacity on average and that there are no electricity cuts (assumed for simplicity reasons) and the monthly energy consumption is 26,880 kilowatt-hours • Tools to monitor power outages (0–1) (kWh); hourly consumption is 112 kWh. • Tools to restore power supply (0–1) - If multiple electricity suppliers exist, the warehouse is served by the cheapest supplier. • Regulatory monitoring of utilities’ performance (0–1) - Tariffs effective in January of the current year are used for calculation of the price of electricity for the warehouse. Although January has 31 days, for calculation purposes only 30 days are used. • Financial deterrents limiting outages (0–1) • Transparency and accessibility of tariffs (0–1) Price of electricity (cents per kilowatt-hour)* • Price based on monthly bill for commercial warehouse in case study *Note: Doing Business measures the price of electricity, but it is not included in the ease of doing business score nor in the ranking on the ease of getting electricity. Page 31 Doing Business 2020 India Getting Electricity - Mumbai Standardized Connection Name of utility Adani Electricity Mumbai Limited (AEML) Price of electricity (US cents per kWh) 20.3 City Covered Mumbai Indicator Mumbai South Asia OECD high Best Regulatory income Performance Procedures (number) 4 5.5 4.4 3 (28 Economies) Time (days) 82 86.1 74.8 18 (3 Economies) Cost (% of income per capita) 8.6 952.6 61.0 0.0 (3 Economies) Reliability of supply and transparency of tariff index (0-8) 7 2.7 7.4 8 (26 Economies) Figure – Getting Electricity in Mumbai – Score 83.3 72.2 99.9 87.5 Reliability of supply and transparency of Procedures Time Cost tariff index Figure – Getting Electricity in Mumbai and comparator economies – Ranking and Score DB 2020 Getting Electricity Score 0 100 95.4: China (Rank: 12) 92.6: Delhi 85.7: Mumbai 71.1: Mexico (Rank: 106) 64.0: Pakistan (Rank: 123) 34.9: Bangladesh (Rank: 176) Note: The ranking of economies on the ease of getting electricity is determined by sorting their scores for getting electricity. These scores are the simple average of the scores for all the component indicators except the price of electricity. Figure – Getting Electricity in Mumbai – Procedure, Time and Cost Time (days) Cost (% of income per capita) 9 80 8 70 Cost (% of income per capita) 7 60 6 Time (days) 50 5 40 4 30 3 20 2 10 1 0 0 1 2 3 4 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures Page 32 Doing Business 2020 India reflected here, see the summary below. Figure – Getting Electricity in Mumbai and comparator economies – Measure of Quality 8 7 7 7 7 6 6 Index score 5 5 4 3 2.7 2 1 0 0 Mumbai Bangladesh China Mexico Pakistan Delhi South Asia Page 33 Doing Business 2020 India Details – Getting Electricity in Mumbai – Procedure, Time and Cost No. Procedures Time to Complete Associated Costs 1 Submit application to utility and await site inspection 7 calendar days INR 75 Agency : Adani Electricity Mumbai Limited All applications from 100-150 KW can be registered and accepted online over the online portal (https://iss.adanielectricity.com/MUMBAINSC/frmNewConnection.aspx? AppsubType=H+jAB1V798s%3d# ) In addition, the following documents need to be submitted alongside the application: 1) Proof of ID of owner (Copy of Certificate of incorporation for a company) 2) Property card (7-12 extract); Title clearance certificate 2 Receive external site inspection by Adani Electricity Mumbai Limited and await estimate 8 INR 0 Agency : Adani Electricity Mumbai Limited A site inspection is carried out for the following purposes: a) Technical Feasibility / Load sanction b) Identifying the route and other details for laying Network (Required for cases requiring RoW permit) c) Checking Meter board installation 3 Pay estimate and receive external connection works 60 calendar days INR 11,853.24 Agency : Adani Electricity Mumbai Limited Customers usually pay the connection fees and security deposit after receiving the estimate. The external works involve: a) Obtaining online RoW permit (as applicable) through relevant Municipal authorities. Eg. MCGM Online portal b) Laying of Service cable, upto the customer's installation c) Installation of meters and wiring within the meter board d) Energizing of connection 4 Submit test report, and receive meter installation 7 calendar days INR 0 Agency : Adani Electricity Mumbai Limited After the completion of the external wiring, the customer's licensed electrical contractor submits the test report to the utility. Once the report is submitted, the meter installation is scheduled by the utility. The utility then finalizes the connection within 5 business days of submitting the test report. The warehouse can be immediately be energized. Takes place simultaneously with previous procedure. Page 34 Doing Business 2020 India Details – Getting Electricity in Mumbai – Measure of Quality Answer Reliability of supply and transparency of tariff index (0-8) 7 Total duration and frequency of outages per customer a year (0-3) 2 System average interruption duration index (SAIDI) 2.7 System average interruption frequency index (SAIFI) 2.2 What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 5.0 Mechanisms for monitoring outages (0-1) 1 Does the distribution utility use automated tools to monitor outages? Yes Mechanisms for restoring service (0-1) 1 Does the distribution utility use automated tools to restore service? Yes Regulatory monitoring (0-1) 1 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on reliability of supply? Yes Financial deterrents aimed at limiting outages (0-1) 1 Does the utility either pay compensation to customers or face fines by the regulator (or both) if outages exceed a certain cap? Yes Communication of tariffs and tariff changes (0-1) 1 Are effective tariffs available online? Yes Link to the website, if available online AEML URL :- https://www.adanielectricit y.com/-/media/Project/Ele ctricity/Regulatory/Tarrif_o rder_Distribution_Order- 200_of_2017- 12092018.pdf MERC URL :- http://www.mercindia.org.i n/pdf/Order%2058%2042/ Order- 200%20of%202017- 12092018.pdf Are customers notified of a change in tariff ahead of the billing cycle? Yes Note: If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tariff index. If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index. If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Page 35 Doing Business 2020 India Getting Electricity - Delhi Standardized Connection Name of utility TATA Power Delhi Distribution Limited Price of electricity (US cents per kWh) 16.3 City Covered Delhi Indicator Delhi South Asia OECD high Best Regulatory income Performance Procedures (number) 3 5.5 4.4 3 (28 Economies) Time (days) 27 86.1 74.8 18 (3 Economies) Cost (% of income per capita) 46.3 952.6 61.0 0.0 (3 Economies) Reliability of supply and transparency of tariff index (0-8) 6 2.7 7.4 8 (26 Economies) Figure – Getting Electricity in Delhi – Score 100.0 96.1 99.4 75.0 Reliability of supply and transparency of Procedures Time Cost tariff index Figure – Getting Electricity in Delhi and comparator economies – Ranking and Score DB 2020 Getting Electricity Score 0 100 95.4: China (Rank: 12) 92.6: Delhi 85.7: Mumbai 71.1: Mexico (Rank: 106) 64.0: Pakistan (Rank: 123) 34.9: Bangladesh (Rank: 176) Note: The ranking of economies on the ease of getting electricity is determined by sorting their scores for getting electricity. These scores are the simple average of the scores for all the component indicators except the price of electricity. Figure – Getting Electricity in Delhi – Procedure, Time and Cost Time (days) Cost (% of income per capita) 50 25 Cost (% of income per capita) 40 20 Time (days) 30 15 20 10 5 10 0 0 1 2 3 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures Page 36 Doing Business 2020 India reflected here, see the summary below. Figure – Getting Electricity in Delhi and comparator economies – Measure of Quality 8 7 7 7 7 6 6 Index score 5 5 4 3 2.7 2 1 0 0 Delhi Bangladesh China Mexico Pakistan Mumbai South Asia Page 37 Doing Business 2020 India Details – Getting Electricity in Delhi – Procedure, Time and Cost No. Procedures Time to Complete Associated Costs 1 Submit application to Tata Power Delhi Distribution Ltd. and await site inspection 3 calendar days INR 64,521.61 Agency : Tata Power Delhi Distribution Ltd. Customers with load 50kVA and above apply for new electrical connections online Following 2 documents are required along with the application form: (I) Proof of ownership or occupany of the premises (Any of the following): i) Certified copy of title deed; ii) Certified copy of registered conveyance deed; iii) General Power of Attorney (GPA); iv) Allotment letter/ Possession letter; v) Valid lease agreement alongwith undertaking that the lease agreement has been signed by the owner or his authorized representative; vi) Rent receipt not earlier than 3 (three) months alongwith undertaking that the rent receipt has been signed by the owner or his authorized representative; vii) Mutation certificate issued by a Government body such as Local Revenue Authorities or Municipal Corporation or land owning agencies like DDA/L&DO; viii)Sub-division agreement; ix) For bonafide consumers residing in JJ clusters or in other areas with no specific municipal address, the licensee may accept either ration card or electoral identity card mandatorily having the same address as a proof of occupancy of the premises. (II) Proof of identity of the applicant: Any of the following documents shall be accepted as proof of identity: i) Electoral identity card; ii) Passport; iii) Driving license; iv) Ration card having photograph; v) Aadhar card; vi) PAN card; vii) Photo identity card issued by any Government agency; viii)If the applicant is an organization, certificate of incorporation/ registration issued by the Registrar and proof of authorization /resolution of Board for authorizing the person. 2 Receive external site inspection from Tata Power and await demand note 3 calendar days INR 0 Agency : Tata Power Delhi Distribution Ltd. TPDDL contacts the customer through phone to make an inspection appointment at customer’s convenience. Representative of TPDDL will inspect the premises to confirm its eligibility and study the technical requirements of giving supply to the consumer and fix the position of main cutouts or circuit breakers and meters and determine the load for the premises in consultation with the consumer and/or his Licensed Electrical Contractor. Customer and/or his Licensed Electrical Contractor must be present during external site inspection. 3 Receive external connection, meter installation and electricity flow 21 calendar days INR 0 Agency : Tata Power Delhi Distribution Ltd. TPDDL will conduct the external connection works, including the fixing of the meter. The utility will then inspect/ test the installation and connect the warehouse to the grid. Takes place simultaneously with previous procedure. Page 38 Doing Business 2020 India Details – Getting Electricity in Delhi – Measure of Quality Answer Reliability of supply and transparency of tariff index (0-8) 6 Total duration and frequency of outages per customer a year (0-3) 1 System average interruption duration index (SAIDI) 4.6 System average interruption frequency index (SAIFI) 2.6 What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 5.0 Mechanisms for monitoring outages (0-1) 1 Does the distribution utility use automated tools to monitor outages? Yes Mechanisms for restoring service (0-1) 1 Does the distribution utility use automated tools to restore service? Yes Regulatory monitoring (0-1) 1 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on reliability of supply? Yes Financial deterrents aimed at limiting outages (0-1) 1 Does the utility either pay compensation to customers or face fines by the regulator (or both) if outages exceed a certain cap? Yes Communication of tariffs and tariff changes (0-1) 1 Are effective tariffs available online? Yes Link to the website, if available online http://tatapower- ddl.com/UploadedFiles/Ta riff%20Ad%20English%20 2015.pdf Are customers notified of a change in tariff ahead of the billing cycle? Yes Note: If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tariff index. If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index. If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Page 39 Doing Business 2020 India Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has five dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in May 2019. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally transfer title on immovable property To make the data comparable across economies, several assumptions about the parties to the (number) transaction, the property and the procedures are used. • Preregistration procedures (for example, checking for liens, The parties (buyer and seller): notarizing sales agreement, paying property transfer taxes) - Are limited liability companies (or the legal equivalent). • Registration procedures in the economy's largest business city. - Are located in the periurban (that is, on the outskirts of the city but still within its official limits) • Postregistration procedures (for example, filling title with area of the economy’s largest business city. For 11 economies the data are also collected for the municipality) second largest business city. - Are 100% domestically and privately owned. Time required to complete each procedure (calendar days) - Perform general commercial activities. • Does not include time spent gathering information The property (fully owned by the seller): • Each procedure starts on a separate day - though procedures - Has a value of 50 times income per capita, which equals the sale price. that can be fully completed online are an exception to this rule - Is fully owned by the seller. • Procedure is considered completed once final document is - Has no mortgages attached and has been under the same ownership for the past 10 years. received - Is registered in the land registry or cadastre, or both, and is free of title disputes. • No prior contact with officials - Is located in a periurban commercial zone (that is, on the outskirts of the city but still within its official limits), and no rezoning is required. Cost required to complete each procedure (% of property - Consists of land and a building. The land area is 557.4 square meters (6,000 square feet). A two- value) story warehouse of 929 square meters (10,000 square feet) is located on the land. The warehouse is 10 years old, is in good condition, has no heating system and complies with all safety standards, • Official costs only (such as administrative fees, duties and building codes and legal requirements. The property, consisting of land and building, will be taxes). transferred in its entirety. • Value Added Tax, Capital Gains Tax and illicit payments are - Will not be subject to renovations or additional construction following the purchase. excluded - Has no trees, natural water sources, natural reserves or historical monuments of any kind. - Will not be used for special purposes, and no special permits, such as for residential use, Quality of land administration index (0-30) industrial plants, waste storage or certain types of agricultural activities, are required. • Reliability of infrastructure index (0-8) - Has no occupants, and no other party holds a legal interest in it. • Transparency of information index (0–6) • Geographic coverage index (0–8) • Land dispute resolution index (0–8) • Equal access to property rights index (-2–0) Page 40 Doing Business 2020 India Registering Property - Mumbai Indicator Mumbai South Asia OECD high Best Regulatory income Performance Procedures (number) 9 6.9 4.7 1 (5 Economies) Time (days) 68 107.8 23.6 1 (2 Economies) Cost (% of property value) 7.4 7.0 4.2 0.0 (Saudi Arabia) Quality of the land administration index (0-30) 14.0 9.1 23.2 None in 2018/19 Figure – Registering Property in Mumbai – Score 33.3 67.9 50.4 46.7 Procedures Time Cost Quality of the land administration index Figure – Registering Property in Mumbai and comparator economies – Ranking and Score DB 2020 Registering Property Score 0 100 81.0: China (Rank: 28) 60.2: Mexico (Rank: 105) 49.6: Mumbai 48.6: Pakistan (Rank: 151) 45.8: Delhi 29.0: Bangladesh (Rank: 184) Note: The ranking of economies on the ease of registering property is determined by sorting their scores for registering property. These scores are the simple average of the scores for each of the component indicators. Page 41 Doing Business 2020 India Figure – Registering Property in Mumbai – Procedure, Time and Cost Time (days) Cost (% of property value) 7 60 6 Cost (% of property value) 50 5 Time (days) 40 4 30 3 20 2 10 1 0 0 1 *2 *3 4 *5 *6 7 8 9 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures reflected here, see the summary below. Page 42 Doing Business 2020 India Figure – Registering Property in Mumbai and comparator economies – Measure of Quality 30 25 24.0 Index score 20 16.3 15 14.0 9.8 9.1 10 8.0 6.5 5 0 Mumbai Bangladesh China Mexico Pakistan Delhi South Asia Details – Registering Property in Mumbai – Procedure, Time and Cost No. Procedures Time to Complete Associated Costs 1 Conduct a title search at the office of Sub-Registrar of Assurance 4 days INR 750; (INR 25 per year Agency : Sub-Registrar of Assurance and search is done over The purchaser should conduct a search of the property in the Registry and the Revenue Office, 30 years, the minimum noting the location details of the property and the time period to be checked. While investigating payment is INR 300) the title it should be verified. (1) the legal ownership document (i.e. the title document) is in the name of the owner and is duly stamped and registered before the concerned sub-registrar of assurances. The revenue record is in the name of the owner, issued by the Revenue Record Department under the seal of the Tahsildar". (2) that on the date of purchase the title of the owner for the preceding 30 years (preferably) shows no mortgage or other encumbrance as still existing on the date of purchase, (3) the property is transferable and heritable, (4) the transferor is competent and/or authorized to transfer the property, (5) the transferee is qualified to be a transferee, (6) the object or consideration for the transfer is lawful, (7) the transfer has been made and completed in the manner prescribed by law. Also, all papers with regard to payment of taxes, the electricity bills and water bills need to be checked. If the seller is a Company incorporated under the provisions of the Companies Act, 2013 then it is prudent to take search in the office of the Registrar of Companies to verify whether there is any charge on the property registered under the provisions of Section 81 of the Companies Act, 2013. 2 Ensure that property is clear of all local tax dues Less than one day, no charge Agency : Local authorities online Non-payment of local property tax can result in the property being attached and sold by the local body. The last local tax bill will show the previous dues if any and the receipt of payment will indicate the date on which the payment was made. The receipt is issued by the local body upon receipt of payment. 3 Conduct charges search at the Registrar of Companies Less than one day, INR 100 Agency : Registrar of Companies online In case of companies formed under the provisions of Companies Act, 2013 and/or under the provisions of Companies Act, 1956 as also in case of any Limited Liability Partnership firms, all charges, modification of charges and satisfaction of charges are required to be compulsorily registered with the Registrar of Companies. Searches on the website of the Ministry of Company Affairs can be taken to peruse the charges created. 4 Prepare the final sale deed with the purchaser’s lawyer 7 days INR 69,686.44; (About 1% Agency : Lawyer of the property value The lawyer prepares the final sale deed and then engrosses the document on green paper leaving (About INR 55,000). This the date and place blank. This document is then submitted for stamping. The fee for the lawyer includes legal fees for due varies from transaction to transaction. diligence, drafting the transfer deed and monitoring the registration and mutation process.) Page 43 Doing Business 2020 India 5 Obtain a certificate for the Tax Deductible at Source 7 days 1% of the property value to Agency : Income Tax Department (Federal level) be deducted On June 1, 2013, Section 194IA of the Income Tax became effective. This section establishes that a Tax Deductible at Source (TDS) of 1% of the property value should be deducted at source from the amount paid to the seller/transferor of Immovable Property. This provision is only applicable to properties that have a value over INR 5,000,000. Any sum deducted under section 194-IA shall be paid to the credit of the Central Government. The tax deducted is to be paid electronically on the Income Tax Departments website by filling form 26QB within 7 days from the end of the month in which TDS was deducted. After depositing the TDS with the government, the buyer is required to give the TDS certificate to the Transferor (seller). The TDS certificate is generated within 10 days from the date of deposit of TDS. The purchaser is required to obtain form 26QB and the Transferor is required to obtain form 16B. 6 Pay Stamp Duty on the final Sale Deed through franking at the designated bank. 1 day INR 418,118.62; (6% of Agency : Designated and authorised Banks and Government Revenue Accounting Department for property value) online payment Since December 2013 stamp duty and registration fees through electronic secured bank treasury receipt (eSBTR)—an online payment service available round-the-clock has been implemented in Mumbai and entire Maharashtra.Under this system, a customer can log onto the website of the authorized bank, click the link for payment of stamp duty/registration fees, enter the necessary details and pay the duty through the internet banking account. With the printout as proof of the online payment, the customer can walk into the nominated branches of the bank to get the eSBTR. The eSBTR is a receipt with security features, which has been designed by India Security Press, Nashik. Alternatively, there is also a facility to make the data entry online and make the payment in bank branches. The sub-registrar then has to register the documents attached with the receipt. While stamp duty payment can be made online, the e-stamp certificate (proof of payment of stamp duty) is required to be annexed to the sale deed, is required to be physically collected from the authorized bank branches. Payment could be made 1) Online- through credit card, debit card, internet banking for online payment mode. 2) through the process of Simple receipt (receipt printed on A-4 size paper). Payment is made to Banks,stamp vendors and post offices also who issue these receipts. Payments can be made through Cash, Cheque, Bank Draft or through electronic payment 3) ESBTR (Electronic Bank and Treasury Receipt) - Few banks have been authorized to issue ESBTR. Banks accept payment by various modes and then issue these ESBTRs. Payment through GRAS system- details at https://gras.mahakosh.gov.in/igr/ 7 Execute final sale deed and submit documents to the local office of the Sub-Registrar of 3 days INR 30,200; (1% of market Assurances value of the property Agency : Sub Registrar of Assurances (Maximum INR 30,000) + The execution of the sale deed in front of the 2 witnesses is commonly done at the same time and INR 20 per page of final place where the buyer submits documents to the Sub-Registrar. sale deed for scanning The documents are submitted to the office of the Sub Registrar of Assurances within whose charges) jurisdiction the property is located. The authorized signatories of the seller and purchaser are required to be present along with two witnesses. Once the document is registered, a distinct document number is assigned to that document. The record of registration is kept in the office of sub registrar of assurance. The documents are submitted to the Reader of the Sub-Registrar of Assurances for scrutiny. After scrutiny, the Reader indicates the registration fee required, which is 1% of the transaction value or Rs. 30,000/- whichever is less on the document itself. The due registration fee is to be deposited with the cashier against a receipt. After depositing the fees, the documents are presented before the Sub-Registrar in accordance with Section 32 of the Registration Act, 1908. Normally, the Seller hands over the peaceful vacant and physical possession of the property to the buyer simultaneous to the deed being presented for registration. Upon payment of the required registration fees and computer service charges in cash, as per the receipt, the document is returned within 30 minutes of getting the receipt. The documentation shall include: (1) Document required to be registered (in duplicate) (2) Two passport-size photographs of the authorized signatories of both parties. (3) Photo identification of each party and witnesses i.e. voters' identity card, passport, identity card issued by Govt. of India, Semi Govt. and Autonomous bodies or identification by a Gazette Officer. (4) Certified true copies of certificate of incorporation of both seller and purchaser. (5) Copy of the latest property register card (to be obtained from the City Survey Department) to indicate that the property does not belong to the government (6) Copy of the Municipal Tax bill to indicate the year in which the building was constructed (7) Copy of PAN Card of Income Tax of the Seller and the Buyer annexed along with the Sale Deed. The registration fees can be paid e-Challan on GRAS or e-SBTR through the websites of the authorized participatory banks. Page 44 Doing Business 2020 India 8 Apply to the Land & Survey Office for mutation of the title of the property 23 days no charge Agency : Land & Survey Office An application for mutation of the title of the property will have to be made to the City Survey and Land Records office for seeking mutation of the title of the property in the name of the purchaser. The authorized signatory has to submit the duly signed application along with the affidavit, indemnity bond and a notarized copy of the registered Sale Deed. After the assessment of the request for mutation, the City Survey and Land Records office decides the value of the tax on the property and issues a letter of mutation in favor of the purchaser. The Property Card will also be updated. 9 Apply for name change at Municipal Corporation of Greater Mumbai 30 days no charge Agency : Municipal Corporation of Greater Mumbai Once the deed has been registered at the land registry and the Property Card updated, the new owner must also update the property record at the Municipal Corporation of Greater Mumbai for tax purposes. This is not automatically done. Takes place simultaneously with previous procedure. Page 45 Doing Business 2020 India Details – Registering Property in Mumbai – Measure of Quality Answer Score Quality of the land administration index (0-30) 14.0 Reliability of infrastructure index (0-8) 6.0 Type of land registration system in the economy: Deed Registration System What is the institution in charge of immovable property registration? Sub-Registrar office In what format are past and newly issued land records kept at the immovable property registry of the largest Computer/Scanned 1.0 business city of the economy —in a paper format or in a computerized format (scanned or fully digital)? Is there a comprehensive and functional electronic database for checking for encumbrances (liens, mortgages, Yes 1.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: Land Records Department In what format are past and newly issued cadastral plans kept at the mapping agency of the largest business Computer/Fully digital 2.0 city of the economy—in a paper format or in a computerized format (scanned or fully digital)? Is there an electronic database for recording boundaries, checking plans and providing cadastral information Yes 1.0 (geographic information system)? Is the information recorded by the immovable property registration agency and the cadastral or mapping agency Separate databases 0.0 kept in a single database, in different but linked databases or in separate databases? Do the immovable property registration agency and cadastral or mapping agency use the same identification Yes 1.0 number for properties? Transparency of information index (0–6) 4.5 Who is able to obtain information on land ownership at the agency in charge of immovable property registration Anyone who pays the 1.0 in the largest business city? official fee Is the list of documents that are required to complete any type of property transaction made publicly available– Yes, online 0.5 and if so, how? Link for online access: www.igrmaharashtra. gov.in under the heading 'Activities' and sub heading 'Document Registration' http://www.igrmahara shtra.gov.in/SB_ACTI VITES/activites_Doc Registration.aspx Is the applicable fee schedule for any type of property transaction at the agency in charge of immovable property Yes, online 0.5 registration in the largest business city made publicly available–and if so, how? Link for online access: www.igrmaharashtra. gov.in under the heading 'Publications' and sub heading 'Fee Structure' http://www.igrmahara shtra.gov.in/SB_PUB LICATION/DATA/Regi stration%20fee%20ta ble.pdf Does the agency in charge of immovable property registration agency formally commit to deliver a legally Yes, online 0.5 binding document that proves property ownership within a specific timeframe –and if so, how does it communicate the service standard? Page 46 Doing Business 2020 India Link for online access: www.igrmaharashtra. gov.in under the heading Citizen's Charter http://www.igrmahara shtra.gov.in/SB_CITI ZENAREA/citizenAre a_CC_pdf.aspx Is there a specific and independent mechanism for filing complaints about a problem that occurred at the agency No 0.0 in charge of immovable property registration? Contact information: Are there publicly available official statistics tracking the number of transactions at the immovable property Yes 0.5 registration agency? Number of property transfers in the largest business city in 2018: 2249874.0 Who is able to consult maps of land plots in the largest business city? Only intermediaries 0.0 and interested parties Is the applicable fee schedule for accessing maps of land plots made publicly available—and if so, how? Yes, on public boards 0.5 Link for online access: Does the cadastral/mapping agency formally specifies the timeframe to deliver an updated cadastral plan—and Yes, on public boards 0.5 if so, how does it communicate the service standard? Link for online access: Is there a specific and independent mechanism for filing complaints about a problem that occurred at the Yes 0.5 cadastral or mapping agency? Contact information: Geographic coverage index (0–8) 0.0 Are all privately held land plots in the largest business city formally registered at the immovable property No 0.0 registry? Are all privately held land plots in the economy formally registered at the immovable property registry? No 0.0 Are all privately held land plots in the largest business city mapped? No 0.0 Are all privately held land plots in the economy mapped? No 0.0 Land dispute resolution index (0–8) 3.5 Does the law require that all property sale transactions be registered at the immovable property registry to make Yes 1.5 them opposable to third parties? Legal basis: Section 17 of the Indian Registration Act, 1908 Is the system of immovable property registration subject to a state or private guarantee? No 0.0 Type of guarantee: Legal basis: Is there a is a specific, out-of-court compensation mechanism to cover for losses incurred by parties who No 0.0 engaged in good faith in a property transaction based on erroneous information certified by the immovable property registry? Legal basis: Does the legal system require a control of legality of the documents necessary for a property transaction (e.g., Yes 0.5 checking the compliance of contracts with requirements of the law)? If yes, who is responsible for checking the legality of the documents? Lawyer; Does the legal system require verification of the identity of the parties to a property transaction? Yes 0.5 If yes, who is responsible for verifying the identity of the parties? Registrar; Is there a national database to verify the accuracy of government issued identity documents? Yes 1.0 Page 47 Doing Business 2020 India What is the Court of first instance in charge of a case involving a standard land dispute between two local City Civil Court businesses over tenure rights for a property worth 50 times gross national income (GNI) per capita and located in the largest business city? How long does it take on average to obtain a decision from the first-instance court for such a case (without More than 3 years 0.0 appeal)? Are there publicly available statistics on the number of land disputes at the economy level in the first instance No 0.0 court? Number of land disputes in the economy in 2018: Equal access to property rights index (-2–0) 0.0 Do unmarried men and unmarried women have equal ownership rights to property? Yes Do married men and married women have equal ownership rights to property? Yes 0.0 Page 48 Doing Business 2020 India Registering Property - Delhi Indicator Delhi South Asia OECD high Best Regulatory income Performance Procedures (number) 9 6.9 4.7 1 (5 Economies) Time (days) 49 107.8 23.6 1 (2 Economies) Cost (% of property value) 8.1 7.0 4.2 0.0 (Saudi Arabia) Quality of the land administration index (0-30) 8.0 9.1 23.2 None in 2018/19 Figure – Registering Property in Delhi – Score 33.3 77.0 46.2 26.7 Procedures Time Cost Quality of the land administration index Figure – Registering Property in Delhi and comparator economies – Ranking and Score DB 2020 Registering Property Score 0 100 81.0: China (Rank: 28) 60.2: Mexico (Rank: 105) 49.6: Mumbai 48.6: Pakistan (Rank: 151) 45.8: Delhi 29.0: Bangladesh (Rank: 184) Note: The ranking of economies on the ease of registering property is determined by sorting their scores for registering property. These scores are the simple average of the scores for each of the component indicators. Page 49 Doing Business 2020 India Figure – Registering Property in Delhi – Procedure, Time and Cost Time (days) Cost (% of property value) 7 6 40 Cost (% of property value) 5 Time (days) 30 4 3 20 2 10 1 0 0 1 *2 *3 *4 5 *6 *7 8 9 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://doingbusiness.org/en/methodology). For details on the procedures reflected here, see the summary below. Page 50 Doing Business 2020 India Figure – Registering Property in Delhi and comparator economies – Measure of Quality 30 25 24.0 Index score 20 16.3 15 14.0 9.8 9.1 10 8.0 6.5 5 0 Delhi Bangladesh China Mexico Pakistan Mumbai South Asia Details – Registering Property in Delhi – Procedure, Time and Cost No. Procedures Time to Complete Associated Costs 1 Conduct title search at the sub-registrar office 7 days INR 3,000; (INR 100 for Agency : Sub-Registrar Office each year searched. The purchaser should conduct a title search of the property in the Registry Office to ascertain that Usually, 30 years are (1) the legal ownership document is in the name of the owner, issued by the Revenue Record searched as part of the Department (2) the title deeds, mutation entries for the preceding 30 years (preferably) to create a due diligence process.) chain of title to ensure that the property has no mortgages or other charges (3) the property is transferable and heritable, (4) the transferor is competent and/or authorized to transfer the property, (5) the transferee is qualified to be a transferee, (6) the consideration is lawful, (7) the transfer has been made and completed in the manner prescribed by law. The search may be done online free of cost. However, the land records of all the properties in Delhi may not yet be available on the website (https://doris.delhigovt.nic.in/login.aspx) .Therefore, title search may still have to be conducted offline at the Registrar's Office. 2 Ensure that property is clear of all local tax dues 7 days INR 200 Agency : Municipal Corporation of Delhi (North, South or East - depending on the location of the property) Request all records regarding payment of local property taxes and any other possible municipal dues, for pick-up a week later, to ensure that the owner of the property is in good standing with municipal authorities 3 Conduct charges search at the Registrar of Companies Less than one day, INR 100 Agency : Registrar of Companies online If the seller is a Company incorporated under the provisions of the Companies Act, 2013, the purchaser should conduct a search in the office of the Registrar of Companies to verify whether there is any charge (mortgage, encumbrance, etc.) on the property registered under Section 125 of the Companies Act, 2013. Note that if the Seller is not able to produce title deed, then Buyer must also check any potential creditors for mortgages by deposit of title deed, which are not recorded anywhere. 4 Check for unpaid utility bills online Less than one day, no charge Agency : Utility website online This is part of the due diligence process done by the lawyer. The seller will provide the payment receipts and the lawyer will verify online if these bills were paid and that there are no outstanding bills. 5 Prepare the final sale deed with the purchaser’s lawyer 7 days INR 69,686.44; (1% of the Agency : Lawyer property value) The lawyer prepares the final sale deed and then engrosses the document on green paper leaving the date and place blank. This document is then submitted for stamping. The fee for the lawyer varies from transaction to transaction. Page 51 Doing Business 2020 India 6 Obtain a certificate for the Tax Deductible at Source 7 days no charge Agency : Income Tax Department (Federal level) On June 1, 2013, Section 194IA of the Income Tax became effective. This section establishes that a Tax Deductible at Source (TDS) of 1% of the property value must be deducted at source from the amount paid to the seller/transferor of Immovable Property. This provision is only applicable to properties that have a value over INR 5,000,000. Any sum deducted under section 194-IA must be paid to the credit of the Central Government within a period of seven days from the end of the month in which the deduction is made and shall be accompanied by a challan-cum-statement in Form No. 26QB. The sum so deducted must be deposited to the credit of the Central Government by remitting it electronically to the Reserve Bank of India or the State Bank of India or to any authorized bank. Every person responsible for deduction of tax under section 194-IA must give the certificate of deduction of tax at source in Form No. 16B to the payee within fifteen days from the due date for furnishing the Challan-cum-statement in Form No. 26QB under Rule 31A after generating and downloading the same from the web portal specified by the Director General of Income-tax (System) or the person authorized by him. After depositing the TDS to the sub-registrar, the buyer is required to give the TDS certificate to the seller. This is available around 10-15 days after depositing the TDS. TDS can be paid and the TDS certificate can also be obtained online. 7 Pay Stamp Duty on the final Sale Deed through e-stamp paper at the designated bank. 1 day INR 418,118.62; (6% of Agency : Bank property value) The amount of stamp duty is calculated based on the sale consideration or circle rate, whichever is higher, and deposited by the party purchasing the e-stamp paper, in the designated account of the Stock Holding Corporation of India at Corporation Bank by RTGS/NEFT. Thereafter, the UTR no. or other relevant details of the payment along with the details of the property, parties, nature of instruments, Permanent Account Number (PAN) card details of parties, authority letter to the representative of the party to collect the e-stamp paper and ID proof of the party in whose name stamp duty has been purchased, are required to be submitted at the bank and thereafter, the stamp paper is issued. 8 Execute final sale deed and submit documents to the local office of the Sub-Registrar of 3 days INR 69,986.44; (1% of Assurances market value of the Agency : Sub-Registrar of Assurances property Initially an appointment is taken online (http://srams.delhi.gov.in) for the execution of the deed. On + INR100 pasting charge the date of the appointment, the documents are submitted to the designated official for screening. has to be deposited at The designated official verifies the particulars of the purchaser(s), seller(s) and witnesses and also Sub-Registrar office at the verifies the property details and title documents of the seller with respect to the property. time of registration Thereafter, the photographs of the seller, purchaser and witnesses are taken which are also +INR 20 per page of final printed on the back page of the registered sale deed. Further, the registration fees is paid in favor of the office of the Sub-Registrar and receipt for the same is issued. Thereafter, the sale deed is sale deed for scanning registered and a registration receipt is issued. The registered sale deed can be collected from the charges) office of Sub-Registrar after approximately 1 week from the date of registration, upon production of the registration receipt. The following documents are required to be submitted to the office of the Sub-Registrar for registration of a sale deed: (i) two photographs, each of the authorized representatives/directors of the seller and purchaser, along with their ID proof, in original; (ii) PAN cards of seller and purchaser; (iii) the board resolutions in favor of the authorized representative or director executing the sale deed on behalf of the companies; (iii) In case the sale consideration is more than INR 50,00,000/-, proof of payment of 1% deduction as TDS; (iv) ID proof of the witnesses, in original; and (v) previous title documents of the property. The authorized representatives/directors of both parties as well as witnesses are required to be present at the office of the Sub-Registrar, in person, for the registration of the sale deed. Page 52 Doing Business 2020 India 9 Apply for mutation of the property title for tax purposes 30 days INR 1,663; ((i) application Agency : Municipal Corporation of Delhi (MCD) fee for the e-mutation has An application for mutation for tax purposes is done at the Municipal Corporation of Delhi (MCD) been fixed at Rs. 1500 + to change the name of the owner on the property record at the municipality. The authorized (ii) Application for Change signatory submits the duly signed application along with the affidavit, indemnity bond and a of Name with Rs. 3/- Court notarized copy of the registered Sale Deed. After the assessment of the request for mutation, fee stamp affixed on it ; (iii) MCD assess the value of the property tax and a mutation Letter in the name of the new owner is Indemnity Bond on Rs. issued by the MCD. 100/- Stamp Paper duly The mutation of the property can be done online through the relevant website of the zonal attested by Notary; (iv) department of the Municipal Corporation of Delhi. However, the original documents are required to Affidavit on Rs. 10/- Stamp be submitted by the applicant at the time of calling/ hearing by the concerned office of Assessor & Paper duly attested by Collector at their Zonal Office for processing the e-change of name of taxpayer request. Notary + Notary fees Rs. 50) The following documents have to be submitted. 1. Copy of valid instrument (s) of transfer - deed of such transfer must be duly stamped and registered. 2. Transfer duty on such stamp duty must have been paid 3. Complete Chain of document 4. Application for Change of Name with Rs. 3/- Court fee stamp affixed on it. 5. Indemnity Bond on Rs. 100/- Stamp Paper duly attested by Notary. 6. Affidavit on Rs. 10/- Stamp Paper duly attested by Notary. 7. Affidavit regarding dues of property tax Takes place simultaneously with previous procedure. Page 53 Doing Business 2020 India Details – Registering Property in Delhi – Measure of Quality Answer Score Quality of the land administration index (0-30) 8.0 Reliability of infrastructure index (0-8) 2.0 Type of land registration system in the economy: Deed Registration System What is the institution in charge of immovable property registration? Office of the Sub- Registrar In what format are past and newly issued land records kept at the immovable property registry of the largest Computer/Scanned 1.0 business city of the economy —in a paper format or in a computerized format (scanned or fully digital)? Is there a comprehensive and functional electronic database for checking for encumbrances (liens, mortgages, No 0.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: Delhi Development Authority (DDA) In what format are past and newly issued cadastral plans kept at the mapping agency of the largest business Paper 0.0 city of the economy—in a paper format or in a computerized format (scanned or fully digital)? Is there an electronic database for recording boundaries, checking plans and providing cadastral information No 0.0 (geographic information system)? Is the information recorded by the immovable property registration agency and the cadastral or mapping agency Separate databases 0.0 kept in a single database, in different but linked databases or in separate databases? Do the immovable property registration agency and cadastral or mapping agency use the same identification Yes 1.0 number for properties? Transparency of information index (0–6) 2.5 Who is able to obtain information on land ownership at the agency in charge of immovable property registration Anyone who pays the 1.0 in the largest business city? official fee Is the list of documents that are required to complete any type of property transaction made publicly available– Yes, online 0.5 and if so, how? Link for online access: http://www.delhi.gov.i n/wps/wcm/connect/D oIT_DCNORTH/dcno rth/publicservicesslink s/registration+of+doc uments Is the applicable fee schedule for any type of property transaction at the agency in charge of immovable property Yes, online 0.5 registration in the largest business city made publicly available–and if so, how? Link for online access: http://www.delhi.gov.i n/wps/wcm/connect/d oit_revenue/Revenue /Home/Services/Prop erty+Registration Does the agency in charge of immovable property registration agency formally commit to deliver a legally Yes, in person 0.0 binding document that proves property ownership within a specific timeframe –and if so, how does it communicate the service standard? Link for online access: Is there a specific and independent mechanism for filing complaints about a problem that occurred at the agency No 0.0 in charge of immovable property registration? Contact information: Are there publicly available official statistics tracking the number of transactions at the immovable property Yes 0.5 registration agency? Number of property transfers in the largest business city in 2018: 100162 for entire Delhi Who is able to consult maps of land plots in the largest business city? Only intermediaries 0.0 and interested parties Page 54 Doing Business 2020 India Is the applicable fee schedule for accessing maps of land plots made publicly available—and if so, how? No 0.0 Link for online access: Does the cadastral/mapping agency formally specifies the timeframe to deliver an updated cadastral plan—and No 0.0 if so, how does it communicate the service standard? Link for online access: Is there a specific and independent mechanism for filing complaints about a problem that occurred at the No 0.0 cadastral or mapping agency? Contact information: Geographic coverage index (0–8) 0.0 Are all privately held land plots in the largest business city formally registered at the immovable property No 0.0 registry? Are all privately held land plots in the economy formally registered at the immovable property registry? No 0.0 Are all privately held land plots in the largest business city mapped? No 0.0 Are all privately held land plots in the economy mapped? No 0.0 Land dispute resolution index (0–8) 3.5 Does the law require that all property sale transactions be registered at the immovable property registry to make Yes 1.5 them opposable to third parties? Legal basis: Section 17 of the Indian Registration Act, 1908 Is the system of immovable property registration subject to a state or private guarantee? No 0.0 Type of guarantee: Legal basis: Is there a is a specific, out-of-court compensation mechanism to cover for losses incurred by parties who No 0.0 engaged in good faith in a property transaction based on erroneous information certified by the immovable property registry? Legal basis: Does the legal system require a control of legality of the documents necessary for a property transaction (e.g., Yes 0.5 checking the compliance of contracts with requirements of the law)? If yes, who is responsible for checking the legality of the documents? Lawyer; Does the legal system require verification of the identity of the parties to a property transaction? Yes 0.5 If yes, who is responsible for verifying the identity of the parties? Registrar; Is there a national database to verify the accuracy of government issued identity documents? Yes 1.0 What is the Court of first instance in charge of a case involving a standard land dispute between two local Delhi District Court businesses over tenure rights for a property worth 50 times gross national income (GNI) per capita and located in the largest business city? How long does it take on average to obtain a decision from the first-instance court for such a case (without More than 3 years 0.0 appeal)? Are there publicly available statistics on the number of land disputes at the economy level in the first instance No 0.0 court? Number of land disputes in the economy in 2018: Equal access to property rights index (-2–0) 0.0 Do unmarried men and unmarried women have equal ownership rights to property? Yes Do married men and married women have equal ownership rights to property? Yes 0.0 Page 55 Doing Business 2020 India Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the effectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in May 2019. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions through 2 sets of indicators. The depth of credit • Rights of borrowers and lenders through collateral laws (0-10) information index measures rules and practices affecting the coverage, scope and accessibility of • Protection of secured creditors’ rights through bankruptcy laws credit information available through a credit registry or a credit bureau. The strength of legal rights (0-2) index measures the degree to which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined whether a unitary Depth of credit information index (0–8) secured transactions system exists. Then two case scenarios, case A and case B, are used to • Scope and accessibility of credit information distributed by determine how a nonpossessory security interest is created, publicized and enforced according to credit bureaus and credit registries (0-8) the law. Special emphasis is given to how the collateral registry operates (if registration of security interests is possible). The case scenarios involve a secured borrower, company ABC, and a Credit bureau coverage (% of adults) secured lender, BizBank. • Number of individuals and firms listed in largest credit bureau In some economies the legal framework for secured transactions will allow only case A or case B as a percentage of adult population (not both) to apply. Both cases examine the same set of legal provisions relating to the use of Credit registry coverage (% of adults) movable collateral. • Number of individuals and firms listed in credit registry as a Several assumptions about the secured borrower (ABC) and lender (BizBank) are used: percentage of adult population - ABC is a domestic limited liability company (or its legal equivalent). - ABC has up to 50 employees. - ABC has its headquarters and only base of operations in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city. - Both ABC and BizBank are 100% domestically owned. The case scenarios also involve assumptions. In case A, as collateral for the loan, ABC grants BizBank a nonpossessory security interest in one category of movable assets, for example, its machinery or its inventory. ABC wants to keep both possession and ownership of the collateral. In economies where the law does not allow nonpossessory security interests in movable property, ABC and BizBank use a fiduciary transfer-of-title arrangement (or a similar substitute for nonpossessory security interests). In case B, ABC grants BizBank a business charge, enterprise charge, floating charge or any charge that gives BizBank a security interest over ABC’s combined movable assets (or as much of ABC’s movable assets as possible). ABC keeps ownership and possession of the assets. Page 56 Doing Business 2020 India Getting Credit - Mumbai Indicator Mumbai South Asia OECD high Best Regulatory income Performance Strength of legal rights index (0-12) 9 5.5 6.1 12 (5 Economies) Depth of credit information index (0-8) 7 5.1 6.8 8 (53 Economies) Credit registry coverage (% of adults) 0.0 5.1 24.4 100.0 (2 Economies) Credit bureau coverage (% of adults) 63.1 21.0 66.7 100.0 (14 Economies) Figure – Getting Credit in Mumbai – Score 80.0 Score - Getting Credit Figure – Getting Credit in Mumbai and comparator economies – Ranking and Score DB 2020 Getting Credit Score 0 100 90.0: Mexico (Rank: 11) 80.0: Delhi 80.0: Mumbai 60.0: China (Rank: 80) 45.0: Bangladesh (Rank: 119) 45.0: Pakistan (Rank: 119) Note: The ranking of economies on the ease of getting credit is determined by sorting their scores for getting credit. These scores are the sum of the scores for the strength of legal rights index and the depth of credit information index. Page 57 Doing Business 2020 India Figure – Legal Rights in Mumbai and comparator economies 12 10 10 9 9 Index Score 8 6 5.5 5 4 4 2 2 0 Mumbai Bangladesh China Mexico Pakistan Delhi South Asia Page 58 Doing Business 2020 India Details – Legal Rights in Mumbai Strength of legal rights index (0-12) 9 Does an integrated or unified legal framework for secured transactions that extends to the creation, publicity and enforcement of functional equivalents No to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without requiring a specific description Yes of collateral? Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring a specific description of Yes collateral? May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds and replacements of the Yes original assets? Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and obligations be secured between parties; Yes and can the collateral agreement include a maximum amount for which the assets are encumbered? Is a collateral registry in operation for both incorporated and non-incorporated entities, that is unified geographically and by asset type, with an No electronic database indexed by debtor's name? Does a notice-based collateral registry exist in which all functional equivalents can be registered? No Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be performed online by any interested third Yes party? Are secured creditors paid first (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency procedure? Yes Are secured creditors paid first (i.e. before tax claims and employee claims) when a business is liquidated? Yes Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised reorganization procedure? Does the law Yes protect secured creditors’ rights by providing clear grounds for relief from the stay and sets a time limit for it? Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law allow the secured creditor to sell Yes the collateral through public auction or private tender, as well as, for the secured creditor to keep the asset in satisfaction of the debt? Figure – Credit Information in Mumbai and comparator economies 9 8 8 8 7 7 7 7 Index Score 6 5.1 5 4 4 3 2 1 0 Mumbai Bangladesh China Mexico Pakistan Delhi South Asia Page 59 Doing Business 2020 India Details – Credit Information in Mumbai Depth of credit information index (0-8) Credit bureau Credit registry Score Are data on both firms and individuals distributed? Yes No 1 Are both positive and negative credit data distributed? Yes No 1 Are data from retailers or utility companies - in addition to data from banks and No No 0 financial institutions - distributed? Are at least 2 years of historical data distributed? (Credit bureaus and registries Yes No 1 that distribute more than 10 years of negative data or erase data on defaults as soon as they are repaid obtain a score of 0 for this component.) Are data on loan amounts below 1% of income per capita distributed? Yes No 1 By law, do borrowers have the right to access their data in the credit bureau or Yes No 1 credit registry? Can banks and financial institutions access borrowers’ credit information online Yes No 1 (for example, through an online platform, a system-to-system connection or both)? Are bureau or registry credit scores offered as a value-added service to help Yes No 1 banks and financial institutions assess the creditworthiness of borrowers? Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or covers less than 5% of the adult population, the total score on the depth of credit information index is 0. Coverage Credit bureau Credit registry Number of individuals 543,636,959 0 Number of firms 23,028,263 0 Total 566,665,222 0 Percentage of adult population 63.1 0.0 Page 60 Doing Business 2020 India Getting Credit - Delhi Indicator Delhi South Asia OECD high Best Regulatory income Performance Strength of legal rights index (0-12) 9 5.5 6.1 12 (5 Economies) Depth of credit information index (0-8) 7 5.1 6.8 8 (53 Economies) Credit registry coverage (% of adults) 0.0 5.1 24.4 100.0 (2 Economies) Credit bureau coverage (% of adults) 63.1 21.0 66.7 100.0 (14 Economies) Figure – Getting Credit in Delhi – Score 80.0 Score - Getting Credit Figure – Getting Credit in Delhi and comparator economies – Ranking and Score DB 2020 Getting Credit Score 0 100 90.0: Mexico (Rank: 11) 80.0: Delhi 80.0: Mumbai 60.0: China (Rank: 80) 45.0: Bangladesh (Rank: 119) 45.0: Pakistan (Rank: 119) Note: The ranking of economies on the ease of getting credit is determined by sorting their scores for getting credit. These scores are the sum of the scores for the strength of legal rights index and the depth of credit information index. Page 61 Doing Business 2020 India Figure – Legal Rights in Delhi and comparator economies 12 10 10 9 9 Index Score 8 6 5.5 5 4 4 2 2 0 Delhi Bangladesh China Mexico Pakistan Mumbai South Asia Page 62 Doing Business 2020 India Details – Legal Rights in Delhi Strength of legal rights index (0-12) 9 Does an integrated or unified legal framework for secured transactions that extends to the creation, publicity and enforcement of functional equivalents No to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without requiring a specific description Yes of collateral? Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring a specific description of Yes collateral? May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds and replacements of the Yes original assets? Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and obligations be secured between parties; Yes and can the collateral agreement include a maximum amount for which the assets are encumbered? Is a collateral registry in operation for both incorporated and non-incorporated entities, that is unified geographically and by asset type, with an No electronic database indexed by debtor's name? Does a notice-based collateral registry exist in which all functional equivalents can be registered? No Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be performed online by any interested third Yes party? Are secured creditors paid first (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency procedure? Yes Are secured creditors paid first (i.e. before tax claims and employee claims) when a business is liquidated? Yes Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised reorganization procedure? Does the law Yes protect secured creditors’ rights by providing clear grounds for relief from the stay and sets a time limit for it? Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law allow the secured creditor to sell Yes the collateral through public auction or private tender, as well as, for the secured creditor to keep the asset in satisfaction of the debt? Figure – Credit Information in Delhi and comparator economies 9 8 8 8 7 7 7 7 Index Score 6 5.1 5 4 4 3 2 1 0 Delhi Bangladesh China Mexico Pakistan Mumbai South Asia Page 63 Doing Business 2020 India Details – Credit Information in Delhi Depth of credit information index (0-8) Credit bureau Credit registry Score Are data on both firms and individuals distributed? Yes No 1 Are both positive and negative credit data distributed? Yes No 1 Are data from retailers or utility companies - in addition to data from banks and No No 0 financial institutions - distributed? Are at least 2 years of historical data distributed? (Credit bureaus and registries Yes No 1 that distribute more than 10 years of negative data or erase data on defaults as soon as they are repaid obtain a score of 0 for this component.) Are data on loan amounts below 1% of income per capita distributed? Yes No 1 By law, do borrowers have the right to access their data in the credit bureau or Yes No 1 credit registry? Can banks and financial institutions access borrowers’ credit information online Yes No 1 (for example, through an online platform, a system-to-system connection or both)? Are bureau or registry credit scores offered as a value-added service to help Yes No 1 banks and financial institutions assess the creditworthiness of borrowers? Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or covers less than 5% of the adult population, the total score on the depth of credit information index is 0. Coverage Credit bureau Credit registry Number of individuals 543,636,959 0 Number of firms 23,028,263 0 Total 566,665,222 0 Percentage of adult population 63.1 0.0 Page 64 Doing Business 2020 India Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in May 2019. See the methodology for more information. What the indicators measure Case study assumptions • Extent of disclosure index (0–10): Disclosure, review, and To make the data comparable across economies, a case study uses several assumptions about approval requirements for related-party transactions the business and the transaction. • Extent of director liability index (0–10): Ability of minority shareholders to sue and hold interested directors liable for The business (Buyer): prejudicial related-party transactions; Available legal - Is a publicly traded corporation listed on the economy’s most important stock exchange. remedies (damages, disgorgement of profits, disqualification - Has a board of directors and a chief executive officer (CEO) who may legally act on behalf of from managerial position(s) for one year or more, rescission of Buyer where permitted, even if this is not specifically required by law. the transaction) - Has a supervisory board in economies with a two-tier board system on which Mr. James • Ease of shareholder suits index (0–10): Access to internal appointed 60% of the shareholder-elected members. corporate documents; Evidence obtainable during trial and - Has not adopted bylaws or articles of association that go beyond the minimum requirements. allocation of legal expenses Does not follow codes, principles, recommendations or guidelines that are not mandatory. - Is a manufacturing company with its own distribution network. • Extent of conflict of interest regulation index (0-30): Sum of the extent of disclosure, extent of director liability and ease of The transaction involves the following details: shareholder suits indices - Mr. James owns 60% of Buyer, sits on Buyer’s board of directors and elected two directors to • Extent of shareholder rights index (0-6): Shareholders’ rights Buyer’s five-member board. and role in major corporate decisions - Mr. James also owns 90% of Seller, a company that operates a chain of retail hardware stores. Seller recently closed a large number of its stores. • Extent of ownership and control index (0-7): Governance - Mr. James proposes that Buyer purchase Seller’s unused fleet of trucks to expand Buyer’s safeguards protecting shareholders from undue board control distribution of its food products, a proposal to which Buyer agrees. The price is equal to 10% of and entrenchment Buyer’s assets and is higher than the market value. • Extent of corporate transparency index (0-7): Corporate - The proposed transaction is part of the company’s principal activity and is not outside the transparency on ownership stakes, compensation, audits and authority of the company. financial prospects - Buyer enters into the transaction. All required approvals are obtained, and all required disclosures • Extent of shareholder governance index (0–20): Sum of the made—that is, the transaction was not entered into fraudulently. extent of shareholders rights, extent of ownership and control - The transaction causes damages to Buyer. Shareholders sue Mr. James and the executives and and extent of corporate transparency indices directors that approved the transaction. • Strength of minority investor protection index (0–50): Sum of the extent of conflict of interest regulation and extent of shareholder governance indices Page 65 Doing Business 2020 India Protecting Minority Investors - Mumbai Stock exchange information Stock exchange Bombay Stock Exchange Stock exchange URL http://www.bseindia.com Listed firms with equity securities 4909 City Covered Mumbai Indicator Mumbai South Asia OECD high Best Regulatory income Performance Extent of disclosure index (0-10) 8.0 5.8 6.5 10 (13 Economies) Extent of director liability index (0-10) 7.0 5.0 5.3 10 (3 Economies) Ease of shareholder suits index (0-10) 7.0 7.4 7.3 10 (Djibouti) Extent of shareholder rights index (0-6) 6.0 3.5 4.7 6 (19 Economies) Extent of ownership and control index (0-7) 6.0 3.6 4.5 7 (9 Economies) Extent of corporate transparency index (0-7) 6.0 3.3 5.7 7 (13 Economies) Figure – Protecting Minority in Mumbai – Score 80.0 Score - Protecting Minority Investors Figure – Protecting Minority Investors in Mumbai and comparator economies – Ranking and Score DB 2020 Protecting Minority Investors Score 0 100 80.0: Delhi 80.0: Mumbai 72.0: China (Rank: 28) 72.0: Pakistan (Rank: 28) 62.0: Mexico (Rank: 61) 60.0: Bangladesh (Rank: 72) Note: The ranking of economies on the strength of minority investor protections is determined by sorting their scores for protecting minority investors. These scores are the simple average of the scores for the extent of conflict of interest regulation index and the extent of shareholder governance index. Page 66 Doing Business 2020 India Figure – Protecting Minority Investors in Mumbai and comparator economies – Measure of Quality Mumbai 6 7 8 6 6 7 Bangladesh 3 7 6 3 4 7 China 6 4 10 6 5 5 Delhi 6 7 8 6 6 7 Mexico 3 5 8 5 5 5 Pakistan 5 7 6 7 5 6 OECD high income 5.6 5.6 6.6 4.3 4.5 7.4 South Asia 3.9 5.9 6.1 4.4 4.1 7.1 0 5 10 15 20 25 30 35 40 45 Sub-Indicator Score Extent of corporate transparency index (0-7) Extent of director liability index (0-10) Extent of disclosure index (0-10) Extent of ownership and control index (0-7) Extent of shareholder rights index (0-6) Ease of shareholder suits index (0-10) Page 67 Doing Business 2020 India Details – Protecting Minority Investors in Mumbai – Measure of Quality Answer Score Extent of conflict of interest regulation index (0-30) Extent of disclosure index (0-10) 8.0 Whose decision is sufficient to approve the Buyer-Seller transaction? (0-3) Shareholders 3.0 excluding interested parties Must an external body review the terms of the transaction before it takes place? (0-1) Yes 1.0 Must Mr. James disclose his conflict of interest to the board of directors? (0-2) Full disclosure of all 2.0 material facts Must Buyer disclose the transaction in periodic filings (e.g. annual reports)? (0-2) Disclosure on the 2.0 transaction and on the conflict of interest Must Buyer immediately disclose the transaction to the public? (0-2) No disclosure 0.0 obligation Extent of director liability index (0-10) 7.0 Can shareholders representing 10% of Buyer's share capital sue for the damage the transaction caused to Yes 1.0 Buyer? (0-1) Can shareholders hold Mr. James liable for the damage the transaction caused to Buyer? (0-2) Not liable 0.0 Can shareholders hold the other directors liable for the damage the transaction caused to Buyer? (0-2) Liable if unfair or 2.0 prejudicial Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by shareholders? (0-1) Yes 1.0 Must Mr. James repay profits made from the transaction upon a successful claim by shareholders? (0-1) Yes 1.0 Is Mr. James disqualified upon a successful claim by shareholders? (0-1) Yes 1.0 Can a court void the transaction upon a successful claim by shareholders? (0-2) Voidable if negligently 1.0 concluded Ease of shareholder suits index (0-10) 7.0 Before suing, can shareholders representing 10% of Buyer's share capital inspect the transaction documents? Yes 1.0 (0-1) Can the plaintiff obtain any documents from the defendant and witnesses at trial? (0-3) Any relevant 3.0 document Can the plaintiff request categories of documents from the defendant without identifying specific ones? (0-1) No 0.0 Can the plaintiff directly question the defendant and witnesses at trial? (0-2) Yes 2.0 Is the level of proof required for civil suits lower than that of criminal cases? (0-1) Yes 1.0 Can shareholder plaintiffs recover their legal expenses from the company? (0-2) At the discretion of 0.0 the court Extent of shareholder governance index (0-20) Extent of shareholder rights index (0-6) 6.0 Does the sale of 51% of Buyer's assets require shareholder approval? Yes 1.0 Can shareholders representing 10% of Buyer's share capital call for a meeting of shareholders? Yes 1.0 Must Buyer obtain its shareholders’ approval every time it issues new shares? Yes 1.0 Do shareholders automatically receive preemption rights every time Buyer issues new shares? Yes 1.0 Do shareholders elect and dismiss the external auditor? Yes 1.0 Are changes to the rights of a class of shares only possible if the holders of the affected shares approve? Yes 1.0 Extent of ownership and control index (0-7) 6.0 Page 68 Doing Business 2020 India Is it forbidden to appoint the same individual as CEO and chairperson of the board of directors? No 0.0 Must the board of directors include independent and nonexecutive board members? Yes 1.0 Can shareholders remove members of the board of directors without cause before the end of their term? Yes 1.0 Must the board of directors include a separate audit committee exclusively comprising board members? Yes 1.0 Must a potential acquirer make a tender offer to all shareholders upon acquiring 50% of Buyer? Yes 1.0 Must Buyer pay declared dividends within a maximum period set by law? Yes 1.0 Is a subsidiary prohibited from acquiring shares issued by its parent company? Yes 1.0 Extent of corporate transparency index (0-7) 6.0 Must Buyer disclose direct and indirect beneficial ownership stakes representing 5%? Yes 1.0 Must Buyer disclose information about board members’ primary employment and directorships in other Yes 1.0 companies? Must Buyer disclose the compensation of individual managers? Yes 1.0 Must a detailed notice of general meeting be sent 21 days before the meeting? Yes 1.0 Can shareholders representing 5% of Buyer’s share capital put items on the general meeting agenda? No 0.0 Must Buyer's annual financial statements be audited by an external auditor? Yes 1.0 Must Buyer disclose its audit reports to the public? Yes 1.0 Page 69 Doing Business 2020 India Protecting Minority Investors - Delhi Stock exchange information Stock exchange Bombay Stock Exchange Stock exchange URL http://www.bseindia.com Listed firms with equity securities 4909 City Covered Delhi Indicator Delhi South Asia OECD high Best Regulatory income Performance Extent of disclosure index (0-10) 8.0 5.8 6.5 10 (13 Economies) Extent of director liability index (0-10) 7.0 5.0 5.3 10 (3 Economies) Ease of shareholder suits index (0-10) 7.0 7.4 7.3 10 (Djibouti) Extent of shareholder rights index (0-6) 6.0 3.5 4.7 6 (19 Economies) Extent of ownership and control index (0-7) 6.0 3.6 4.5 7 (9 Economies) Extent of corporate transparency index (0-7) 6.0 3.3 5.7 7 (13 Economies) Figure – Protecting Minority in Delhi – Score 80.0 Score - Protecting Minority Investors Figure – Protecting Minority Investors in Delhi and comparator economies – Ranking and Score DB 2020 Protecting Minority Investors Score 0 100 80.0: Delhi 80.0: Mumbai 72.0: China (Rank: 28) 72.0: Pakistan (Rank: 28) 62.0: Mexico (Rank: 61) 60.0: Bangladesh (Rank: 72) Note: The ranking of economies on the strength of minority investor protections is determined by sorting their scores for protecting minority investors. These scores are the simple average of the scores for the extent of conflict of interest regulation index and the extent of shareholder governance index. Page 70 Doing Business 2020 India Figure – Protecting Minority Investors in Delhi and comparator economies – Measure of Quality Delhi 6 7 8 6 6 7 Bangladesh 3 7 6 3 4 7 China 6 4 10 6 5 5 Mexico 3 5 8 5 5 5 Mumbai 6 7 8 6 6 7 Pakistan 5 7 6 7 5 6 OECD high income 5.6 5.6 6.6 4.3 4.5 7.4 South Asia 3.9 5.9 6.1 4.4 4.1 7.1 0 5 10 15 20 25 30 35 40 45 Sub-Indicator Score Extent of corporate transparency index (0-7) Extent of director liability index (0-10) Extent of disclosure index (0-10) Extent of ownership and control index (0-7) Extent of shareholder rights index (0-6) Ease of shareholder suits index (0-10) Page 71 Doing Business 2020 India Details – Protecting Minority Investors in Delhi – Measure of Quality Answer Score Extent of conflict of interest regulation index (0-30) Extent of disclosure index (0-10) 8.0 Whose decision is sufficient to approve the Buyer-Seller transaction? (0-3) Shareholders 3.0 excluding interested parties Must an external body review the terms of the transaction before it takes place? (0-1) Yes 1.0 Must Mr. James disclose his conflict of interest to the board of directors? (0-2) Full disclosure of all 2.0 material facts Must Buyer disclose the transaction in periodic filings (e.g. annual reports)? (0-2) Disclosure on the 2.0 transaction and on the conflict of interest Must Buyer immediately disclose the transaction to the public? (0-2) No disclosure 0.0 obligation Extent of director liability index (0-10) 7.0 Can shareholders representing 10% of Buyer's share capital sue for the damage the transaction caused to Yes 1.0 Buyer? (0-1) Can shareholders hold Mr. James liable for the damage the transaction caused to Buyer? (0-2) Not liable 0.0 Can shareholders hold the other directors liable for the damage the transaction caused to Buyer? (0-2) Liable if unfair or 2.0 prejudicial Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by shareholders? (0-1) Yes 1.0 Must Mr. James repay profits made from the transaction upon a successful claim by shareholders? (0-1) Yes 1.0 Is Mr. James disqualified upon a successful claim by shareholders? (0-1) Yes 1.0 Can a court void the transaction upon a successful claim by shareholders? (0-2) Voidable if negligently 1.0 concluded Ease of shareholder suits index (0-10) 7.0 Before suing, can shareholders representing 10% of Buyer's share capital inspect the transaction documents? Yes 1.0 (0-1) Can the plaintiff obtain any documents from the defendant and witnesses at trial? (0-3) Any relevant 3.0 document Can the plaintiff request categories of documents from the defendant without identifying specific ones? (0-1) No 0.0 Can the plaintiff directly question the defendant and witnesses at trial? (0-2) Yes 2.0 Is the level of proof required for civil suits lower than that of criminal cases? (0-1) Yes 1.0 Can shareholder plaintiffs recover their legal expenses from the company? (0-2) At the discretion of 0.0 the court Extent of shareholder governance index (0-20) Extent of shareholder rights index (0-6) 6.0 Does the sale of 51% of Buyer's assets require shareholder approval? Yes 1.0 Can shareholders representing 10% of Buyer's share capital call for a meeting of shareholders? Yes 1.0 Must Buyer obtain its shareholders’ approval every time it issues new shares? Yes 1.0 Do shareholders automatically receive preemption rights every time Buyer issues new shares? Yes 1.0 Do shareholders elect and dismiss the external auditor? Yes 1.0 Are changes to the rights of a class of shares only possible if the holders of the affected shares approve? Yes 1.0 Extent of ownership and control index (0-7) 6.0 Page 72 Doing Business 2020 India Is it forbidden to appoint the same individual as CEO and chairperson of the board of directors? No 0.0 Must the board of directors include independent and nonexecutive board members? Yes 1.0 Can shareholders remove members of the board of directors without cause before the end of their term? Yes 1.0 Must the board of directors include a separate audit committee exclusively comprising board members? Yes 1.0 Must a potential acquirer make a tender offer to all shareholders upon acquiring 50% of Buyer? Yes 1.0 Must Buyer pay declared dividends within a maximum period set by law? Yes 1.0 Is a subsidiary prohibited from acquiring shares issued by its parent company? Yes 1.0 Extent of corporate transparency index (0-7) 6.0 Must Buyer disclose direct and indirect beneficial ownership stakes representing 5%? Yes 1.0 Must Buyer disclose information about board members’ primary employment and directorships in other Yes 1.0 companies? Must Buyer disclose the compensation of individual managers? Yes 1.0 Must a detailed notice of general meeting be sent 21 days before the meeting? Yes 1.0 Can shareholders representing 5% of Buyer’s share capital put items on the general meeting agenda? No 0.0 Must Buyer's annual financial statements be audited by an external auditor? Yes 1.0 Must Buyer disclose its audit reports to the public? Yes 1.0 Page 73 Doing Business 2020 India Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as the administrative burden of paying taxes and contributions and complying with postfiling procedures (VAT refund and tax audit). The most recent round of data collection for the project was completed in May 2019 covering for the Paying Taxes indicator calendar year 2018 (January 1, 2018 – December 31, 2018). See the methodology for more information. What the indicators measure Case study assumptions Tax payments for a manufacturing company in 2018 (number Using a case scenario, Doing Business records taxes and mandatory contributions a medium size per year adjusted for electronic and joint filing and payment) company must pay in a year, and measures the administrative burden of paying taxes, contributions and dealing with postfiling processes. Information is also compiled on frequency of • Total number of taxes and contributions paid or withheld, filing and payments, time taken to comply with tax laws, time taken to comply with the including consumption taxes (value added tax, sales tax or requirements of postfiling processes and time waiting. goods and service tax) • Method and frequency of filing and payment To make data comparable across economies, several assumptions are used: - TaxpayerCo is a medium-size business that started operations on January 1, 2017. It produces Time required to comply with 3 major taxes (hours per year) ceramic flowerpots and sells them at retail. All taxes and contributions recorded are paid in the • Collecting information, computing tax payable second year of operation (calendar year 2018). Taxes and mandatory contributions are measured at all levels of government. • Preparing separate tax accounting books, if required • Completing tax return, filing with agencies The VAT refund process: - In June 2018, TaxpayerCo. makes a large capital purchase: the value of the machine is 65 times • Arranging payment or withholding income per capita of the economy. Sales are equally spread per month (1,050 times income per capita divided by 12) and cost of goods sold are equally expensed per month (875 times income Total tax and contribution rate (% of commercial profits) per capita divided by 12). The machinery seller is registered for VAT and excess input VAT incurred • Profit or corporate income tax in June will be fully recovered after four consecutive months if the VAT rate is the same for inputs, • Social contributions, labor taxes paid by employer sales and the machine and the tax reporting period is every month. Input VAT will exceed Output VAT in June 2018. • Property and property transfer taxes The corporate income tax audit process: • Dividend, capital gains, financial transactions taxes - An error in calculation of income tax liability (for example, use of incorrect tax depreciation rates, • Waste collection, vehicle, road and other taxes or incorrectly treating an expense as tax deductible) leads to an incorrect income tax return and a corporate income tax underpayment. TaxpayerCo. discovered the error and voluntarily notified the Postfiling Index tax authority. The value of the underpaid income tax liability is 5% of the corporate income tax • Time to comply with VAT refund (hours) liability due. TaxpayerCo. submits corrected information after the deadline for submitting the annual tax return, but within the tax assessment period. • Time to obtain VAT refund (weeks) • Time to comply with a corporate income tax correction (hours) • Time to complete a corporate income tax correction (weeks) Page 74 Doing Business 2020 India Paying Taxes - Mumbai Indicator Mumbai South Asia OECD high Best Regulatory income Performance Payments (number per year) 12 26.7 10.3 3 (2 Economies) Time (hours per year) 254 273.5 158.8 49 (3 Economies) Total tax and contribution rate (% of profit) 49.7 43.9 39.9 26.1 (33 Economies) Postfiling index (0-100) 49.3 41.2 86.7 None in 2018/19 Figure – Paying Taxes in Mumbai – Score 85.0 68.3 65.8 49.3 Payments Time Total tax and contribution rate Postfiling index Figure – Paying Taxes in Mumbai and comparator economies – Ranking and Score DB 2020 Paying Taxes Score 0 100 70.1: China (Rank: 105) 68.1: Delhi 67.1: Mumbai 65.8: Mexico (Rank: 120) 56.1: Bangladesh (Rank: 151) 52.9: Pakistan (Rank: 161) Note: The ranking of economies on the ease of paying taxes is determined by sorting their scores for paying taxes. These scores are the simple average of the scores for each of the component indicators, with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax and contribution rate. The threshold is defined as the total tax and contribution rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing Business 2015, which is 26.1%. All economies with a total tax and contribution rate below this threshold receive the same score as the economy at the threshold. Page 75 Doing Business 2020 India Figure – Paying Taxes in Mumbai and comparator economies – Measure of Quality 60 49.3 50.0 49.3 50 44.4 40.5 41.2 Index score 40 30 20 10.5 10 0 Mumbai Bangladesh China Mexico Pakistan Delhi South Asia Page 76 Doing Business 2020 India Details – Paying Taxes in Mumbai Tax or Payments Notes on Time (hours) Statutory tax Tax base Total tax and Notes on TTCR mandatory (number) Payments rate contribution contribution rate (% of profit) Corporate 1.0 online 25.0 25% taxable profit 21.63 income tax Social security 1.0 online 88.0 13% as of July 1, gross salaries 14.75 contributions 2108 Dividend tax 1.0 20.555% dividend 6.35 distributions Employee's state 1.0 online 4.75% gross salaries 5.36 insurance contribution Property tax 1.0 10% assessed value 1.32 GST on 0.0 online and jointly 18% insurance 0.20 insurance premium premium Employer paid - 1.0 online INR 2,500 fixed fee 0.05 Profession Tax Enrolment (PTE) Labor welfare 2.0 36 RPN fixed fee per 0.05 fund employee Vehicle tax 1.0 INR 200 fixed fee per 0.01 (pollution tax) vehicle Health and 0.0 online and jointly 0.0 4% as of April 1, all federal taxes 0.00 included in other education cess 2018 including the taxes surcharge Income 0.0 jointly 7%/12% on applicable included in other surcharge federal taxes taxes Inter-state GST 0.0 online and jointly 18% value added not included Employee paid - 1.0 online For male fixed fee per withheld Profession Tax employees: Upto employee Registration Rs. 7,500/- Nil (PTR) Rs. 7,501/ to Rs. 10,000/- Rs. 175 per month Above 10,001/- Rs. 200/- per month (except February) & Rs. 300/- for the month of February. For female employees: Upto Rs. 10,000/- Nil Above 10,001/- Rs. 200/- per month (except February) & Rs. 300/- for the month of February. Employee paid - 0.0 online and jointly 12% + 1.75% gross salaries withheld Social security contributions Central GST 1.0 online 141.0 18% value added Page 77 Doing Business 2020 India Fuel tax 1.0 fuel consumption small amount State GST 0.0 online and jointly 18% value added not included Tax on interest 0.0 withheld 10% interest income included in other taxes Totals 12 254 49.7 Page 78 Doing Business 2020 India Details – Paying Taxes in Mumbai – Tax by Type Taxes by type Answer Profit tax (% of profit) 21.6 Labor tax and contributions (% of profit) 20.2 Other taxes (% of profit) 7.9 Page 79 Doing Business 2020 India Details – Paying Taxes in Mumbai – Measure of Quality Answer Score Postfiling index (0-100) 49.3 VAT refunds Does VAT exist? Yes Does a VAT refund process exist per the case study? No Restrictions on VAT refund process Cash refund is restricted to exporters and to inverted duty structure in case of goods Percentage of cases exposed to a VAT audit (%) Not applicable Is there a mandatory carry forward period? No Time to comply with VAT refund (hours) No VAT refund per 0.0 case study scenario Time to obtain VAT refund (weeks) No VAT refund per 0.0 case study scenario Corporate income tax audits Does corporate income tax exist? Yes Percentage of cases exposed to a corporate income tax audit (%) 0% - 24% Time to comply with a corporate income tax correction (hours) 3.0 97.2 Time to complete a corporate income tax correction (weeks) No tax audit per case 100 study scenario Notes: Names of taxes have been standardized. For instance income tax, profit tax, tax on company's income are all named corporate income tax in this table. The hours for VAT include all the VAT and sales taxes applicable. The hours for Social Security include all the hours for labor taxes and mandatory contributions in general. The postfiling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax correction and time to complete a corporate income tax correction. N/A = Not applicable. Page 80 Doing Business 2020 India Paying Taxes - Delhi Indicator Delhi South Asia OECD high Best Regulatory income Performance Payments (number per year) 10 26.7 10.3 3 (2 Economies) Time (hours per year) 250 273.5 158.8 49 (3 Economies) Total tax and contribution rate (% of profit) 49.7 43.9 39.9 26.1 (33 Economies) Postfiling index (0-100) 49.3 41.2 86.7 None in 2018/19 Figure – Paying Taxes in Delhi – Score 88.3 68.9 65.8 49.3 Payments Time Total tax and contribution rate Postfiling index Figure – Paying Taxes in Delhi and comparator economies – Ranking and Score DB 2020 Paying Taxes Score 0 100 70.1: China (Rank: 105) 68.1: Delhi 67.1: Mumbai 65.8: Mexico (Rank: 120) 56.1: Bangladesh (Rank: 151) 52.9: Pakistan (Rank: 161) Note: The ranking of economies on the ease of paying taxes is determined by sorting their scores for paying taxes. These scores are the simple average of the scores for each of the component indicators, with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax and contribution rate. The threshold is defined as the total tax and contribution rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing Business 2015, which is 26.1%. All economies with a total tax and contribution rate below this threshold receive the same score as the economy at the threshold. Page 81 Doing Business 2020 India Figure – Paying Taxes in Delhi and comparator economies – Measure of Quality 60 49.3 50.0 49.3 50 44.4 40.5 41.2 Index score 40 30 20 10.5 10 0 Delhi Bangladesh China Mexico Pakistan Mumbai South Asia Page 82 Doing Business 2020 India Details – Paying Taxes in Delhi Tax or Payments Notes on Time (hours) Statutory tax Tax base Total tax and Notes on TTCR mandatory (number) Payments rate contribution contribution rate (% of profit) Corporate 1.0 online 25.0 25.0% taxable profit 21.66 income tax Social security 1.0 online 84.0 13% as of July 1, gross salaries 14.75 contributions 2018 Dividend tax 1.0 20.555% dividend 6.36 distributions Employee's state 1.0 online 4.75% gross salaries 5.36 insurance contribution Property tax 1.0 10% assessed value 1.32 GST on 0.0 online and jointly 18% insurance 0.20 insurance premium premium Vehicle tax 1.0 INR 200 fixed fee per 0.01 (pollution tax) vehicle Central GST 1.0 online 141.0 18.0% value added 0.00 Labor welfare 2.0 2.25 RPN fixed fee per 0.00 fund employee Health and 0.0 online and jointly 4% as of April 1, all federal taxes 0.00 included in other education cess 2018 including the taxes surcharge Income 0.0 jointly 7%/12% on applicable included in other surcharge federal taxes taxes Inter-state GST 0.0 online and jointly 18.0% value added not included Fuel tax 1.0 fuel consumption small amount Employee paid - 0.0 jointly 12% + 1.75% gross salaries withheld Social security contributions State GST 0.0 online and jointly 18.0% value added not included Tax on interest 0.0 withheld 10% interest income included in other taxes Totals 10 250 49.7 Page 83 Doing Business 2020 India Details – Paying Taxes in Delhi – Tax by Type Taxes by type Answer Profit tax (% of profit) 21.7 Labor tax and contributions (% of profit) 20.1 Other taxes (% of profit) 7.9 Page 84 Doing Business 2020 India Details – Paying Taxes in Delhi – Measure of Quality Answer Score Postfiling index (0-100) 49.3 VAT refunds Does VAT exist? Yes Does a VAT refund process exist per the case study? No Restrictions on VAT refund process Cash refund is restricted to exporters and to inverted duty structure in case of goods Percentage of cases exposed to a VAT audit (%) Not applicable Is there a mandatory carry forward period? No Time to comply with VAT refund (hours) No VAT refund per 0.0 case study scenario Time to obtain VAT refund (weeks) No VAT refund per 0.0 case study scenario Corporate income tax audits Does corporate income tax exist? Yes Percentage of cases exposed to a corporate income tax audit (%) 0% - 24% Time to comply with a corporate income tax correction (hours) 3.0 97.2 Time to complete a corporate income tax correction (weeks) No tax audit per case 100 study scenario Notes: Names of taxes have been standardized. For instance income tax, profit tax, tax on company's income are all named corporate income tax in this table. The hours for VAT include all the VAT and sales taxes applicable. The hours for Social Security include all the hours for labor taxes and mandatory contributions in general. The postfiling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax correction and time to complete a corporate income tax correction. N/A = Not applicable. Page 85 Doing Business 2020 India Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tariffs) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in May 2019. See the methodology for more information. What the indicators measure Case study assumptions Documentary compliance To make the data comparable across economies, a few assumptions are made about the traded goods and the transactions: • Obtaining, preparing and submitting documents during transport, clearance, inspections and port or border handling in Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 days are recorded as origin economy 22×24=528 hours). If customs clearance takes 7.5 hours, the data are recorded as is. Alternatively, • Obtaining, preparing and submitting documents required by suppose documents are submitted to a customs agency at 8:00a.m., are processed overnight and destination economy and any transit economies can be picked up at 8:00a.m. the next day. The time for customs clearance would be recorded as 24 hours because the actual procedure took 24 hours. • Covers all documents required by law and in practice, including electronic submissions of information Cost: Insurance cost and informal payments for which no receipt is issued are excluded from the Border compliance costs recorded. Costs are reported in U.S. dollars. Contributors are asked to convert local currency into U.S. dollars based on the exchange rate prevailing on the day they answer the questionnaire. • Customs clearance and inspections Contributors are private sector experts in international trade logistics and are informed about • Inspections by other agencies (if applied to more than 20% of exchange rates. shipments) Assumptions of the case study: • Handling and inspections that take place at the economy’s port - For all 190 economies covered by Doing Business, it is assumed a shipment is in a warehouse in or border the largest business city of the exporting economy and travels to a warehouse in the largest business city of the importing economy. Domestic transport - It is assumed each economy imports 15 metric tons of containerized auto parts (HS 8708) from • Loading or unloading of the shipment at the warehouse or its natural import partner—the economy from which it imports the largest value (price times port/border quantity) of auto parts. It is assumed each economy exports the product of its comparative advantage (defined by the largest export value) to its natural export partner—the economy that is • Transport between warehouse and port/border the largest purchaser of this product. Shipment value is assumed to be $50,000. • Traffic delays and road police checks while shipment is en - The mode of transport is the one most widely used for the chosen export or import product and route the trading partner, as is the seaport or land border crossing. - All electronic information submissions requested by any government agency in connection with the shipment are considered to be documents obtained, prepared and submitted during the export or import process. - A port or border is a place (seaport or land border crossing) where merchandise can enter or leave an economy. - Relevant government agencies include customs, port authorities, road police, border guards, standardization agencies, ministries or departments of agriculture or industry, national security agencies and any other government authorities. Page 86 Doing Business 2020 India Trading across Borders - Mumbai Indicator Mumbai South Asia OECD high Best Regulatory income Performance Time to export: Border compliance (hours) 50 53.4 12.7 1 (19 Economies) Cost to export: Border compliance (USD) 231 310.6 136.8 0 (19 Economies) Time to export: Documentary compliance (hours) 18 73.7 2.3 1 (26 Economies) Cost to export: Documentary compliance (USD) 50 157.9 33.4 0 (20 Economies) Time to import: Border compliance (hours) 60 85.7 8.5 1 (25 Economies) Cost to import: Border compliance (USD) 273 472.9 98.1 0 (28 Economies) Time to import: Documentary compliance (hours) 22 93.7 3.4 1 (30 Economies) Cost to import: Documentary compliance (USD) 100 261.7 23.5 0 (30 Economies) Figure – Trading across Borders in Mumbai – Score 69.2 78.2 89.9 87.5 78.9 77.3 91.2 85.7 Time Cost Time Cost Time Cost Time Cost to to to to to to to to export: export: export: export: import: import: import: import: Border Border Documentary Documentary Border Border Documentary Documentary compliance compliance compliance compliance compliance compliance compliance compliance Figure – Trading across Borders in Mumbai and comparator economies – Ranking and Score DB 2020 Trading Across Borders Score 0 100 86.5: China (Rank: 56) 82.7: Delhi 82.2: Mumbai 82.1: Mexico (Rank: 69) 68.8: Pakistan (Rank: 111) 31.8: Bangladesh (Rank: 176) Note: The ranking of economies on the ease of trading across borders is determined by sorting their scores for trading across borders. These scores are the simple average of the scores for the time and cost for documentary compliance and border compliance to export and import. Page 87 Doing Business 2020 India Figure – Trading across Borders in Mumbai – Time and Cost Time (hours) Cost (USD) 70 273 300 60 60 231 250 50 Time (hours) 50 Cost (USD) 200 40 150 30 100 22 18 100 20 50 10 50 0 0 Export Export Import Import - - - - Border Documentary Border Documentary Compliance Compliance Compliance Compliance Page 88 Doing Business 2020 India Details – Trading across Borders in Mumbai Characteristics Export Import Product HS 85 : Electrical machinery and equipment and HS 8708: Parts and accessories of motor vehicles parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles Trade partner United States Korea, Rep. Border Nhava Sheva port Nhava Sheva port Distance (km) 46 46 Domestic transport time (hours) 7 9 Domestic transport cost (USD) 158 165 Details – Trading across Borders in Mumbai – Components of Border Compliance Time to Complete (hours) Associated Costs (USD) Export: Clearance and inspections required by 10.0 95.0 customs authorities Export: Clearance and inspections required by 0.0 0.0 agencies other than customs Export: Port or border handling 40.0 136.0 Import: Clearance and inspections required by 12.0 98.0 customs authorities Import: Clearance and inspections required by 0.0 0.0 agencies other than customs Import: Port or border handling 48.0 175.0 Page 89 Doing Business 2020 India Details – Trading across Borders in Mumbai – Trade Documents Export Import Bill of lading Invoice Commercial invoice Packing List Packing list Import General Manifest Customs export declaration Bill of Entry Terminal handling receipts Certificate of Origin SOLAS certificate Bill of lading Cargo Release Order E-Delivery Order Terminal handling receipts SOLAS certificate Page 90 Doing Business 2020 India Trading across Borders - Delhi Indicator Delhi South Asia OECD high Best Regulatory income Performance Time to export: Border compliance (hours) 54 53.4 12.7 1 (19 Economies) Cost to export: Border compliance (USD) 195 310.6 136.8 0 (19 Economies) Time to export: Documentary compliance (hours) 6 73.7 2.3 1 (26 Economies) Cost to export: Documentary compliance (USD) 65 157.9 33.4 0 (20 Economies) Time to import: Border compliance (hours) 70 85.7 8.5 1 (25 Economies) Cost to import: Border compliance (USD) 260 472.9 98.1 0 (28 Economies) Time to import: Documentary compliance (hours) 18 93.7 3.4 1 (30 Economies) Cost to import: Documentary compliance (USD) 100 261.7 23.5 0 (30 Economies) Figure – Trading across Borders in Delhi – Score 66.7 81.6 97.0 83.8 75.3 78.3 92.9 85.7 Time Cost Time Cost Time Cost Time Cost to to to to to to to to export: export: export: export: import: import: import: import: Border Border Documentary Documentary Border Border Documentary Documentary compliance compliance compliance compliance compliance compliance compliance compliance Figure – Trading across Borders in Delhi and comparator economies – Ranking and Score DB 2020 Trading Across Borders Score 0 100 86.5: China (Rank: 56) 82.7: Delhi 82.2: Mumbai 82.1: Mexico (Rank: 69) 68.8: Pakistan (Rank: 111) 31.8: Bangladesh (Rank: 176) Note: The ranking of economies on the ease of trading across borders is determined by sorting their scores for trading across borders. These scores are the simple average of the scores for the time and cost for documentary compliance and border compliance to export and import. Page 91 Doing Business 2020 India Figure – Trading across Borders in Delhi – Time and Cost Time (hours) Cost (USD) 80 300 70 260 70 250 60 Time (hours) 54 195 Cost (USD) 200 50 40 150 30 100 100 65 18 20 6 50 10 0 0 Export Export Import Import - - - - Border Documentary Border Documentary Compliance Compliance Compliance Compliance Page 92 Doing Business 2020 India Details – Trading across Borders in Delhi Characteristics Export Import Product HS 85 : Electrical machinery and equipment and HS 8708: Parts and accessories of motor vehicles parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles Trade partner United States Korea, Rep. Border Mundra port Mundra port Distance (km) 1241 1241 Domestic transport time (hours) 46 97 Domestic transport cost (USD) 500 685 Details – Trading across Borders in Delhi – Components of Border Compliance Time to Complete (hours) Associated Costs (USD) Export: Clearance and inspections required by 11.0 63.0 customs authorities Export: Clearance and inspections required by 0.0 0.0 agencies other than customs Export: Port or border handling 43.0 132.0 Import: Clearance and inspections required by 24.0 90.0 customs authorities Import: Clearance and inspections required by 0.0 0.0 agencies other than customs Import: Port or border handling 46.0 170.0 Page 93 Doing Business 2020 India Details – Trading across Borders in Delhi – Trade Documents Export Import Bill of lading Invoice Commercial invoice Packing list Packing list Import general manifest Customs export declaration Bill of entry Terminal handling Receipts Certificate of origin SOLAS certificate Bill of lading Cargo release order E-Delivery Order Terminal handling receipts SOLAS certificate Page 94 Doing Business 2020 India Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local first-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and efficiency in the court system. The most recent round of data collection was completed in May 2019. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the courts The dispute in the case study involves the breach of a sales contract between two domestic (calendar days) businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes the case from simple debt enforcement. • Time to file and serve the case • Time for trial and to obtain the judgment To make the data on the time and comparable across economies, several assumptions about the case are used: • Time to enforce the judgment - The dispute concerns a lawful transaction between two businesses (Seller and Buyer), both Cost required to enforce a contract through the courts (% of located in the economy’s largest business city. For 11 economies the data are also collected for the claim value) second largest business city. - The Buyer orders custom-made furniture, then fails to pay alleging that the goods are not of • Average attorney fees adequate quality. • Court costs - The value of the dispute is 200% of the income per capita or the equivalent in local currency of USD 5,000, whichever is greater. • Enforcement costs - The Seller sues the Buyer before the court with jurisdiction over commercial cases worth 200% of income per capita or $5,000 whichever is greater. Quality of judicial processes index (0-18) - The Seller requests the pretrial attachment of the defendant’s movable assets to secure the • Court structure and proceedings (-1-5) claim. - The claim is disputed on the merits because of Buyer’s allegation that the quality of the goods • Case management (0-6) was not adequate. • Court automation (0-4) - The judge decides in favor of the seller; there is no appeal. • Alternative dispute resolution (0-3) - The Seller enforces the judgment through a public sale of the Buyer’s movable assets. Page 95 Doing Business 2020 India Enforcing Contracts - Mumbai Standardized Case Claim value INR 344,566 Court name Bombay City Civil Court City Covered Mumbai Indicator Mumbai South Asia OECD high Best Regulatory income Performance Time (days) 1445 1,101.6 589.6 120 (Singapore) Cost (% of claim value) 31.0 29.9 21.5 0.1 (Bhutan) Quality of judicial processes index (0-18) 10.5 7.1 11.7 None in 2018/19 Figure – Enforcing Contracts in Mumbai – Score 0.0 65.2 58.3 Time Cost Quality of judicial processes index Figure – Enforcing Contracts in Mumbai and comparator economies – Ranking and Score DB 2020 Enforcing Contracts Score 0 100 80.9: China (Rank: 5) 67.0: Mexico (Rank: 43) 43.5: Pakistan (Rank: 156) 41.2: Delhi 41.2: Mumbai 22.2: Bangladesh (Rank: 189) Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their scores for enforcing contracts. These scores are the simple average of the scores for each of the component indicators. Page 96 Doing Business 2020 India Figure – Enforcing Contracts in Mumbai – Time and Cost Time (days) Cost (% of claim value) 1600 80 1442 1445 1445 Cost (% of claim value) 1400 66.8 70 1200 1071 60 Time (days) 1000 50 800 33.0 40 31.0 31.0 589.6 29.9 600 496 30 21.5 20.5 400 16.2 341 20 200 10 0 0 1,101.6 Bangladesh China Delhi Mexico Mumbai OECD Pakistan South high Asia income Page 97 Doing Business 2020 India Figure – Enforcing Contracts in Mumbai and comparator economies – Measure of Quality Mumbai 2.5 1.5 2 4.5 Bangladesh 3 1 0.5 3 China 3 5.5 3 5 Delhi 2.5 1.5 2 4.5 Mexico 2.5 3.3 0.5 3.8 Pakistan 2 1.2 0.5 2 OECD high income 2.5 3.2 2.4 3.6 South Asia 2.4 1.2 0.8 3.1 0 2 4 6 8 10 12 14 16 18 Sub-Indicator Score Alternative dispute resolution (0-3) Case management (0-6) Court automation (0-4) Court structure and proceedings (-1-5) Details – Enforcing Contracts in Mumbai Indicator Time (days) 1445 Filing and service 45 Trial and judgment 1095 Enforcement of judgment 305 Cost (% of claim value) 31.0 Attorney fees 22 Court fees 8.5 Enforcement fees 0.5 Quality of judicial processes index (0-18) 10.5 Court structure and proceedings (-1-5) 4.5 Case management (0-6) 1.5 Court automation (0-4) 2.0 Alternative dispute resolution (0-3) 2.5 Page 98 Doing Business 2020 India Details – Enforcing Contracts in Mumbai – Measure of Quality Answer Score Quality of judicial processes index (0-18) 10.5 Court structure and proceedings (-1-5) 4.5 1. Is there a court or division of a court dedicated solely to hearing commercial cases? Yes 1.5 2. Small claims court 1.5 2.a. Is there a small claims court or a fast-track procedure for small claims? Yes 2.b. If yes, is self-representation allowed? Yes 3. Is pretrial attachment available? Yes 1.0 4. Are new cases assigned randomly to judges? Yes, but manual 0.5 5. Does a woman's testimony carry the same evidentiary weight in court as a man's? Yes 0.0 Case management (0-6) 1.5 1. Time standards 0.5 1.a. Are there laws setting overall time standards for key court events in a civil case? Yes 1.b. If yes, are the time standards set for at least three court events? Yes 1.c. Are these time standards respected in more than 50% of cases? No 2. Adjournments 0.0 2.a. Does the law regulate the maximum number of adjournments that can be granted? Yes 2.b. Are adjournments limited to unforeseen and exceptional circumstances? No 2.c. If rules on adjournments exist, are they respected in more than 50% of cases? No 3. Can two of the following four reports be generated about the competent court: (i) time to disposition report; (ii) Yes 1.0 clearance rate report; (iii) age of pending cases report; and (iv) single case progress report? 4. Is a pretrial conference among the case management techniques used before the competent court? No 0.0 5. Are there any electronic case management tools in place within the competent court for use by judges? No 0.0 6. Are there any electronic case management tools in place within the competent court for use by lawyers? No 0.0 Court automation (0-4) 2.0 1. Can the initial complaint be filed electronically through a dedicated platform within the competent court? No 0.0 2. Is it possible to carry out service of process electronically for claims filed before the competent court? No 0.0 3. Can court fees be paid electronically within the competent court? Yes 1.0 4. Publication of judgments 1.0 4.a Are judgments rendered in commercial cases at all levels made available to the general public Yes through publication in official gazettes, in newspapers or on the internet or court website? 4.b. Are judgments rendered in commercial cases at the appellate and supreme court level made Yes available to the general public through publication in official gazettes, in newspapers or on the internet or court website? Alternative dispute resolution (0-3) 2.5 1. Arbitration 1.0 1.a. Is domestic commercial arbitration governed by a consolidated law or consolidated chapter or Yes section of the applicable code of civil procedure encompassing substantially all its aspects? 1.b. Are there any commercial disputes—aside from those that deal with public order or public policy— Yes that cannot be submitted to arbitration? 1.c. Are valid arbitration clauses or agreements usually enforced by the courts? Yes Page 99 Doing Business 2020 India 2. Mediation/Conciliation 1.5 2.a. Is voluntary mediation or conciliation available? Yes 2.b. Are mediation, conciliation or both governed by a consolidated law or consolidated chapter or Yes section of the applicable code of civil procedure encompassing substantially all their aspects (for example, definition, aim and scope of application, desig 2.c. Are there financial incentives for parties to attempt mediation or conciliation (i.e., if mediation or Yes conciliation is successful, a refund of court filing fees, income tax credits or the like)? Page 100 Doing Business 2020 India Enforcing Contracts - Delhi Standardized Case Claim value INR 344,566 Court name Delhi District Court City Covered Delhi Indicator Delhi South Asia OECD high Best Regulatory income Performance Time (days) 1445 1,101.6 589.6 120 (Singapore) Cost (% of claim value) 31.0 29.9 21.5 0.1 (Bhutan) Quality of judicial processes index (0-18) 10.5 7.1 11.7 None in 2018/19 Figure – Enforcing Contracts in Delhi – Score 0.0 65.2 58.3 Time Cost Quality of judicial processes index Figure – Enforcing Contracts in Delhi and comparator economies – Ranking and Score DB 2020 Enforcing Contracts Score 0 100 80.9: China (Rank: 5) 67.0: Mexico (Rank: 43) 43.5: Pakistan (Rank: 156) 41.2: Delhi 41.2: Mumbai 22.2: Bangladesh (Rank: 189) Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their scores for enforcing contracts. These scores are the simple average of the scores for each of the component indicators. Page 101 Doing Business 2020 India Figure – Enforcing Contracts in Delhi – Time and Cost Time (days) Cost (% of claim value) 1600 80 1442 1445 1445 Cost (% of claim value) 1400 66.8 70 1200 1071 60 Time (days) 1000 50 800 33.0 40 31.0 31.0 589.6 29.9 600 496 30 21.5 20.5 400 16.2 341 20 200 10 0 0 1,101.6 Bangladesh China Delhi Mexico Mumbai OECD Pakistan South high Asia income Page 102 Doing Business 2020 India Figure – Enforcing Contracts in Delhi and comparator economies – Measure of Quality Delhi 2.5 1.5 2 4.5 Bangladesh 3 1 0.5 3 China 3 5.5 3 5 Mexico 2.5 3.3 0.5 3.8 Mumbai 2.5 1.5 2 4.5 Pakistan 2 1.2 0.5 2 OECD high income 2.5 3.2 2.4 3.6 South Asia 2.4 1.2 0.8 3.1 0 2 4 6 8 10 12 14 16 18 Sub-Indicator Score Alternative dispute resolution (0-3) Case management (0-6) Court automation (0-4) Court structure and proceedings (-1-5) Details – Enforcing Contracts in Delhi Indicator Time (days) 1445 Filing and service 45 Trial and judgment 1095 Enforcement of judgment 305 Cost (% of claim value) 31.0 Attorney fees 22 Court fees 8.5 Enforcement fees 0.5 Quality of judicial processes index (0-18) 10.5 Court structure and proceedings (-1-5) 4.5 Case management (0-6) 1.5 Court automation (0-4) 2.0 Alternative dispute resolution (0-3) 2.5 Page 103 Doing Business 2020 India Details – Enforcing Contracts in Delhi – Measure of Quality Answer Score Quality of judicial processes index (0-18) 10.5 Court structure and proceedings (-1-5) 4.5 1. Is there a court or division of a court dedicated solely to hearing commercial cases? Yes 1.5 2. Small claims court 1.5 2.a. Is there a small claims court or a fast-track procedure for small claims? Yes 2.b. If yes, is self-representation allowed? Yes 3. Is pretrial attachment available? Yes 1.0 4. Are new cases assigned randomly to judges? Yes, but manual 0.5 5. Does a woman's testimony carry the same evidentiary weight in court as a man's? Yes 0.0 Case management (0-6) 1.5 1. Time standards 0.5 1.a. Are there laws setting overall time standards for key court events in a civil case? Yes 1.b. If yes, are the time standards set for at least three court events? Yes 1.c. Are these time standards respected in more than 50% of cases? No 2. Adjournments 0.0 2.a. Does the law regulate the maximum number of adjournments that can be granted? Yes 2.b. Are adjournments limited to unforeseen and exceptional circumstances? No 2.c. If rules on adjournments exist, are they respected in more than 50% of cases? No 3. Can two of the following four reports be generated about the competent court: (i) time to disposition report; (ii) Yes 1.0 clearance rate report; (iii) age of pending cases report; and (iv) single case progress report? 4. Is a pretrial conference among the case management techniques used before the competent court? No 0.0 5. Are there any electronic case management tools in place within the competent court for use by judges? No 0.0 6. Are there any electronic case management tools in place within the competent court for use by lawyers? No 0.0 Court automation (0-4) 2.0 1. Can the initial complaint be filed electronically through a dedicated platform within the competent court? No 0.0 2. Is it possible to carry out service of process electronically for claims filed before the competent court? No 0.0 3. Can court fees be paid electronically within the competent court? Yes 1.0 4. Publication of judgments 1.0 4.a Are judgments rendered in commercial cases at all levels made available to the general public Yes through publication in official gazettes, in newspapers or on the internet or court website? 4.b. Are judgments rendered in commercial cases at the appellate and supreme court level made Yes available to the general public through publication in official gazettes, in newspapers or on the internet or court website? Alternative dispute resolution (0-3) 2.5 1. Arbitration 1.0 1.a. Is domestic commercial arbitration governed by a consolidated law or consolidated chapter or Yes section of the applicable code of civil procedure encompassing substantially all its aspects? 1.b. Are there any commercial disputes—aside from those that deal with public order or public policy— Yes that cannot be submitted to arbitration? 1.c. Are valid arbitration clauses or agreements usually enforced by the courts? Yes Page 104 Doing Business 2020 India 2. Mediation/Conciliation 1.5 2.a. Is voluntary mediation or conciliation available? Yes 2.b. Are mediation, conciliation or both governed by a consolidated law or consolidated chapter or Yes section of the applicable code of civil procedure encompassing substantially all their aspects (for example, definition, aim and scope of application, desig 2.c. Are there financial incentives for parties to attempt mediation or conciliation (i.e., if mediation or Yes conciliation is successful, a refund of court filing fees, income tax credits or the like)? Page 105 Doing Business 2020 India Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection was completed in May 2019. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are used: • Measured in calendar years • Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 suppliers. The hotel experiences financial difficulties. Cost required to recover debt (% of debtor’s estate) - The value of the hotel is 100% of the income per capita or the equivalent in local currency of USD 200,000, whichever is greater. • Measured as percentage of estate value - The hotel has a loan from a domestic bank, secured by a mortgage over the hotel’s real estate. • Court fees The hotel cannot pay back the loan, but makes enough money to operate otherwise. • Fees of insolvency administrators In addition, Doing Business evaluates the quality of legal framework applicable to judicial • Lawyers’ fees liquidation and reorganization proceedings and the extent to which best insolvency practices have • Assessors’ and auctioneers’ fees been implemented in each economy covered. • Other related fees Outcome • Whether business continues operating as a going concern or business assets are sold piecemeal Recovery rate for creditors • Measures the cents on the dollar recovered by secured creditors • Outcome for the business (survival or not) determines the maximum value that can be recovered • Official costs of the insolvency proceedings are deducted • Depreciation of furniture is taken into account • Present value of debt recovered Strength of insolvency framework index (0- 16) • Sum of the scores of four component indices: • Commencement of proceedings index (0-3) • Management of debtor’s assets index (0-6) • Reorganization proceedings index (0-3) • Creditor participation index (0-4) Page 106 Doing Business 2020 India Resolving Insolvency - Mumbai Indicator Mumbai South Asia OECD high Best Regulatory income Performance Recovery rate (cents on the dollar) 71.6 38.1 70.2 92.9 (Norway) Time (years) 1.6 2.2 1.7 0.4 (Ireland) Cost (% of estate) 9.0 9.9 9.3 1.0 (Norway) Outcome (0 as piecemeal sale and 1 as going concern) 1 .. .. .. Strength of insolvency framework index (0-16) 7.5 6.5 11.9 None in 2018/19 Figure – Resolving Insolvency in Mumbai – Score 77.0 46.9 Recovery rate Strength of insolvency framework index Figure – Resolving Insolvency in Mumbai and comparator economies – Ranking and Score DB 2020 Resolving Insolvency Score 0 100 70.3: Mexico (Rank: 33) 62.1: China (Rank: 51) 62.0: Delhi 62.0: Mumbai 59.0: Pakistan (Rank: 58) 28.1: Bangladesh (Rank: 154) Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their scores for resolving insolvency. These scores are the simple average of the scores for the recovery rate and the strength of insolvency framework index. Page 107 Doing Business 2020 India Figure – Resolving Insolvency in Mumbai – Time and Cost Time (years) Cost (% of estate) 4.5 25 4.0 22.0 4 Cost (% of estate) 3.5 18.0 20 Time (years) 3 2.6 15 2.5 2.2 2 1.7 1.8 1.7 9.3 9.9 1.6 9.0 1.6 9.0 10 8.0 1.5 1 4.0 5 0.5 0 0 Bangladesh China Delhi Mexico Mumbai OECD Pakistan South high Asia income Page 108 Doing Business 2020 India Figure – Resolving Insolvency in Mumbai and comparator economies – Measure of Quality Mumbai 4.5 2 1 0 Bangladesh 2 2 0 China 6 3 2 2.5 Delhi 4.5 2 1 0 Mexico 5.5 2.5 2 1.5 Pakistan 5.5 2.5 2 1.5 OECD high income 5.3 2.8 2.1 1.9 South Asia 3.6 2.1 0.9 0.6 0 2 4 6 8 10 12 14 16 Sub-Indicator Score Management of debtor's assets index (0-6) Commencement of proceedings index (0-3) Creditor participation index (0-4) Reorganization proceedings index (0-3) Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice.” Figure – Resolving Insolvency in Mumbai and comparator economies – Recovery Rate Recovery rate(cents on the dollar) 80 71.6 71.6 70 63.9 60 50 42.8 36.9 38.1 40 29.1 30 20 10 0 Mumbai Bangladesh China Mexico Pakistan Delhi South Asia Page 109 Doing Business 2020 India Details – Resolving Insolvency in Mumbai Indicator Answer Score Proceeding reorganization Bizbank is a secured creditor and upon a default by Mirage, it is most likely to seek reorganization and the continuation of Mirage as a going concern. Bizbank would file a petition to the National Company Law Tribunal. With the implementation of the Insolvency and Bankruptcy Code, a reorganization is the most likely procedure in practice. Outcome going concern BizBank would initiate reorganization process and thus the most likely outcome would be going concern. Time (in years) 1.6 Bizbank will apply to the National Company Law Tribunal to file for reorganization. This will take a couple of months. The reorganization procedure until the reorganization plan is approved it takes about 1.8 years. Cost (% of estate) 9.0 The costs associated with the case would amount to approximately 9% of the value of the debtor's estate. Costs incurred during the entire foreclosure process mainly include court or government agency fees (INR 300,000, according to Mumbai Court fees Act, 1959), attorney fees (INR 100,000), costs of notification and publication (INR 25,000), fees of accountants, assessors, inspectors and other professionals (INR 100,000), fees of auctioneers (INR 50,000), fees of service providers and/or government levies (INR 100,000-200,000), and other fees (INR 100,000). Recovery rate 71.6 (cents on the dollar) Page 110 Doing Business 2020 India Details – Resolving Insolvency in Mumbai – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 7.5 Commencement of proceedings index (0-3) 2.0 What procedures are available to a DEBTOR when commencing insolvency proceedings? (c) Debtor may file for 0.5 reorganization only Does the insolvency framework allow a CREDITOR to file for insolvency of the debtor? N/A 0.5 What basis for commencement of the insolvency proceedings is allowed under the insolvency framework? (a) (a) Debtor is 1.0 Debtor is generally unable to pay its debts as they mature (b) The value of debtor's liabilities exceeds the value generally unable to of its assets pay its debts as they mature Management of debtor's assets index (0-6) 4.5 Does the insolvency framework allow the continuation of contracts supplying essential goods and services to the No 0.0 debtor? Does the insolvency framework allow the rejection by the debtor of overly burdensome contracts? Yes 1.0 Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0 Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0 Does the insolvency framework provide for the possibility of the debtor obtaining credit after commencement of Yes 1.0 insolvency proceedings? Does the insolvency framework assign priority to post-commencement credit? (a) Yes over all pre- 0.5 commencement creditors, secured or unsecured Reorganization proceedings index (0-3) 0.0 Which creditors vote on the proposed reorganization plan? (c) Other 0.0 Does the insolvency framework require that dissenting creditors in reorganization receive at least as much as No 0.0 what they would obtain in a liquidation? Are the creditors divided into classes for the purposes of voting on the reorganization plan, does each class vote No 0.0 separately and are creditors in the same class treated equally? Creditor participation index (0-4) 1.0 Does the insolvency framework require approval by the creditors for selection or appointment of the insolvency No 0.0 representative? Does the insolvency framework require approval by the creditors for sale of substantial assets of the debtor? No 0.0 Does the insolvency framework provide that a creditor has the right to request information from the insolvency Yes 1.0 representative? Does the insolvency framework provide that a creditor has the right to object to decisions accepting or rejecting No 0.0 creditors' claims? Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice.” Page 111 Doing Business 2020 India Resolving Insolvency - Delhi Indicator Delhi South Asia OECD high Best Regulatory income Performance Recovery rate (cents on the dollar) 71.6 38.1 70.2 92.9 (Norway) Time (years) 1.6 2.2 1.7 0.4 (Ireland) Cost (% of estate) 9.0 9.9 9.3 1.0 (Norway) Outcome (0 as piecemeal sale and 1 as going concern) 1 .. .. .. Strength of insolvency framework index (0-16) 7.5 6.5 11.9 None in 2018/19 Figure – Resolving Insolvency in Delhi – Score 77.0 46.9 Recovery rate Strength of insolvency framework index Figure – Resolving Insolvency in Delhi and comparator economies – Ranking and Score DB 2020 Resolving Insolvency Score 0 100 70.3: Mexico (Rank: 33) 62.1: China (Rank: 51) 62.0: Delhi 62.0: Mumbai 59.0: Pakistan (Rank: 58) 28.1: Bangladesh (Rank: 154) Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their scores for resolving insolvency. These scores are the simple average of the scores for the recovery rate and the strength of insolvency framework index. Page 112 Doing Business 2020 India Figure – Resolving Insolvency in Delhi – Time and Cost Time (years) Cost (% of estate) 4.5 25 4.0 22.0 4 Cost (% of estate) 3.5 18.0 20 Time (years) 3 2.6 15 2.5 2.2 2 1.7 1.8 1.7 9.3 9.9 1.6 9.0 1.6 9.0 10 8.0 1.5 1 4.0 5 0.5 0 0 Bangladesh China Delhi Mexico Mumbai OECD Pakistan South high Asia income Page 113 Doing Business 2020 India Figure – Resolving Insolvency in Delhi and comparator economies – Measure of Quality Delhi 4.5 2 1 0 Bangladesh 2 2 0 China 6 3 2 2.5 Mexico 5.5 2.5 2 1.5 Mumbai 4.5 2 1 0 Pakistan 5.5 2.5 2 1.5 OECD high income 5.3 2.8 2.1 1.9 South Asia 3.6 2.1 0.9 0.6 0 2 4 6 8 10 12 14 16 Sub-Indicator Score Management of debtor's assets index (0-6) Commencement of proceedings index (0-3) Creditor participation index (0-4) Reorganization proceedings index (0-3) Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice.” Figure – Resolving Insolvency in Delhi and comparator economies – Recovery Rate Recovery rate(cents on the dollar) 80 71.6 71.6 70 63.9 60 50 42.8 36.9 38.1 40 29.1 30 20 10 0 Delhi Bangladesh China Mexico Pakistan Mumbai South Asia Page 114 Doing Business 2020 India Details – Resolving Insolvency in Delhi Indicator Answer Score Proceeding reorganization Bizbank is a secured creditor and upon a default by Mirage, it is most likely to seek reorganization and the continuation of Mirage as a going concern. Bizbank would file a petition to the National Company Law Tribunal. With the implementation of the Insolvency and Bankruptcy Code, a reorganization is the most likely procedure in practice. Outcome going concern BizBank would initiate reorganization process and thus the most likely outcome would be going concern. Time (in years) 1.6 Bizbank will apply to the National Company Law Tribunal to file for reorganization. This will take a couple of months. The reorganization procedure until the reorganization plan is approved it takes about 1.8 years. Cost (% of estate) 9.0 The costs associated with the case would amount to approximately 9% of the value of the debtor's estate. Costs incurred during the entire insolvency process mainly include court or government agency fees (INR 300,000), attorney fees (INR 100,000), costs of notification and publication (INR 25,000), fees of accountants, assessors, inspectors and other professionals (INR 100,000), fees of auctioneers (INR 50,000), fees of service providers and/or government levies (INR 100,000-200,000), and other fees (INR 100,000). Recovery rate 71.6 (cents on the dollar) Page 115 Doing Business 2020 India Details – Resolving Insolvency in Delhi – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 7.5 Commencement of proceedings index (0-3) 2.0 What procedures are available to a DEBTOR when commencing insolvency proceedings? (c) Debtor may file for 0.5 reorganization only Does the insolvency framework allow a CREDITOR to file for insolvency of the debtor? N/A 0.5 What basis for commencement of the insolvency proceedings is allowed under the insolvency framework? (a) (a) Debtor is 1.0 Debtor is generally unable to pay its debts as they mature (b) The value of debtor's liabilities exceeds the value generally unable to of its assets pay its debts as they mature Management of debtor's assets index (0-6) 4.5 Does the insolvency framework allow the continuation of contracts supplying essential goods and services to the No 0.0 debtor? Does the insolvency framework allow the rejection by the debtor of overly burdensome contracts? Yes 1.0 Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0 Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0 Does the insolvency framework provide for the possibility of the debtor obtaining credit after commencement of Yes 1.0 insolvency proceedings? Does the insolvency framework assign priority to post-commencement credit? (a) Yes over all pre- 0.5 commencement creditors, secured or unsecured Reorganization proceedings index (0-3) 0.0 Which creditors vote on the proposed reorganization plan? (c) Other 0.0 Does the insolvency framework require that dissenting creditors in reorganization receive at least as much as No 0.0 what they would obtain in a liquidation? Are the creditors divided into classes for the purposes of voting on the reorganization plan, does each class vote No 0.0 separately and are creditors in the same class treated equally? Creditor participation index (0-4) 1.0 Does the insolvency framework require approval by the creditors for selection or appointment of the insolvency No 0.0 representative? Does the insolvency framework require approval by the creditors for sale of substantial assets of the debtor? No 0.0 Does the insolvency framework provide that a creditor has the right to request information from the insolvency Yes 1.0 representative? Does the insolvency framework provide that a creditor has the right to object to decisions accepting or rejecting No 0.0 creditors' claims? Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice.” Page 116 Doing Business 2020 India Employing Workers Doing Business presents detailed data for the employing workers indicators on the Doing Business website (http://www.doingbusiness.org). The study does not present rankings of economies on these indicators or include the topic in the aggregate ease of doing business score or ranking on the ease of doing business. The most recent round of data collection was completed in May 2019. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions about the worker and the (i) whether fixed-term contracts are prohibited for permanent business are used. tasks; (ii) maximum cumulative duration of fixed-term contracts; (iii) length of the maximum probationary period; (iv) minimum The worker: wage;(v) ratio of minimum wage to the average value added per - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. worker. - Is a full-time employee. - Is not a member of the labor union, unless membership is mandatory. Working hours (i) maximum number of working days allowed per week; (ii) The business: premiums for work: at night, on a weekly rest day and overtime; - Is a limited liability company (or the equivalent in the economy). (iii) whether there are restrictions on work at night, work on a - Operates a supermarket or grocery store in the economy’s largest business city. For 11 weekly rest day and for overtime work; (iv) length of paid annual economies the data are also collected for the second largest business city. leave. - Has 60 employees. - Is subject to collective bargaining agreements if such agreements cover more than 50% of the Redundancy rules food retail sector and they apply even to firms that are not party to them. (i) whether redundancy can be basis for terminating workers; (ii) - Abides by every law and regulation but does not grant workers more benefits than those whether employer needs to notify and/or get approval from third mandated by law, regulation or (if applicable) collective bargaining agreements. party to terminate 1 redundant worker and a group of 9 redundant workers; (iii) whether the law requires employer to reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost (i) notice period for redundancy dismissal; (ii) severance payments, and (iii) penalties due when terminating a redundant worker. Data on the availability of unemployment protection for a worker with one year of employment is also collected. Page 117 Doing Business 2020 India Employing Workers - Mumbai Details – Employing Workers in Mumbai Answer Hiring Fixed-term contracts prohibited for permanent tasks? No Maximum length of a single fixed-term contract (months) No limit Maximum length of fixed-term contracts, including renewals (months) No limit Minimum wage applicable to the worker assumed in the case study (US$/month) 143.5 Ratio of minimum wage to value added per worker 0.6 Maximum length of probationary period (months) 3.0 Working hours Standard workday 9.0 Maximum number of working days per week 6.0 Premium for night work (% of hourly pay) 0.0 Premium for work on weekly rest day (% of hourly pay) 100.0 Premium for overtime work (% of hourly pay) 100.0 Restrictions on night work? Yes Restrictions on weekly holiday? No Restrictions on overtime work? Yes Paid annual leave for a worker with 1 year of tenure (working days) 18.0 Paid annual leave for a worker with 5 years of tenure (working days) 18.0 Paid annual leave for a worker with 10 years of tenure (working days) 18.0 Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days) 18.0 Redundancy rules Dismissal due to redundancy allowed by law? Yes Third-party notification if one worker is dismissed? Yes Third-party approval if one worker is dismissed? No Third-party notification if nine workers are dismissed? Yes Third-party approval if nine workers are dismissed? No Retraining or reassignment obligation before redundancy? No Priority rules for redundancies? Yes Priority rules for reemployment? Yes Redundancy cost Notice period for redundancy dismissal for a worker with 1 year of tenure (weeks of salary) 4.3 Notice period for redundancy dismissal for a worker with 5 years of tenure (weeks of salary) 4.3 Notice period for redundancy dismissal for a worker with 10 years of tenure (weeks of salary) 4.3 Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure, in weeks of salary) 4.3 Severance pay for redundancy dismissal for a worker with 1 year of tenure (weeks of salary) 2.1 Severance pay for redundancy dismissal for a worker with 5 years of tenure (weeks of salary) 10.7 Page 118 Doing Business 2020 India Severance pay for redundancy dismissal for a worker with 10 years of tenure (weeks of salary) 21.4 Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure, in weeks of salary) 11.4 Unemployment protection after one year of employment? No Page 119 Doing Business 2020 India Employing Workers - Delhi Details – Employing Workers in Delhi Answer Hiring Fixed-term contracts prohibited for permanent tasks? No Maximum length of a single fixed-term contract (months) No limit Maximum length of fixed-term contracts, including renewals (months) No limit Minimum wage applicable to the worker assumed in the case study (US$/month) 245.8 Ratio of minimum wage to value added per worker 1.0 Maximum length of probationary period (months) 3.0 Working hours Standard workday 9.0 Maximum number of working days per week 6.0 Premium for night work (% of hourly pay) 0.0 Premium for work on weekly rest day (% of hourly pay) 0.0 Premium for overtime work (% of hourly pay) 100.0 Restrictions on night work? Yes Restrictions on weekly holiday? Yes Restrictions on overtime work? Yes Paid annual leave for a worker with 1 year of tenure (working days) 15.0 Paid annual leave for a worker with 5 years of tenure (working days) 15.0 Paid annual leave for a worker with 10 years of tenure (working days) 15.0 Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days) 15.0 Redundancy rules Dismissal due to redundancy allowed by law? Yes Third-party notification if one worker is dismissed? Yes Third-party approval if one worker is dismissed? No Third-party notification if nine workers are dismissed? Yes Third-party approval if nine workers are dismissed? No Retraining or reassignment obligation before redundancy? No Priority rules for redundancies? Yes Priority rules for reemployment? Yes Redundancy cost Notice period for redundancy dismissal for a worker with 1 year of tenure (weeks of salary) 4.3 Notice period for redundancy dismissal for a worker with 5 years of tenure (weeks of salary) 4.3 Notice period for redundancy dismissal for a worker with 10 years of tenure (weeks of salary) 4.3 Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure, in weeks of salary) 4.3 Severance pay for redundancy dismissal for a worker with 1 year of tenure (weeks of salary) 2.1 Severance pay for redundancy dismissal for a worker with 5 years of tenure (weeks of salary) 10.7 Page 120 Doing Business 2020 India Severance pay for redundancy dismissal for a worker with 10 years of tenure (weeks of salary) 21.4 Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure, in weeks of salary) 11.4 Unemployment protection after one year of employment? No Page 121 Doing Business 2020 India Business Reforms in India From May 2, 2018 to May 1, 2019, 115 economies implemented 294 business regulatory reforms across the 10 areas measured by Doing Business. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are reforms implemented since Doing Business 2008. =Doing Business reform making it easier to do business. = Change making it more difficult to do business. DB2020 Starting a Business: India made starting a business easier by abolishing filing fees for the SPICe company incorporation form, electronic memorandum of association and articles of association. This reform applies to both Delhi and Mumbai. Dealing with Construction Permits: India (Delhi) streamlined the process, reduced the time and cost of obtaining construction permits and improved building quality control by strengthening professional certification requirements. India (Mumbai) streamlined the process of obtaining a building permit and made it faster and less expensive to get a construction permit. Trading across Borders: India made trading across borders easier by enabling post-clearance audits, integrating trade stakeholders in a single electronic platform, upgrading port infrastructures and enhancing the electronic submission of documents. This reform applies to both Mumbai and New Delhi. Resolving Insolvency: India made resolving insolvency easier by promoting reorganization proceedings in practice. India also made resolving insolvency more difficult by not allowing dissenting creditors to receive as much under reorganization as they would receive in liquidation. This reform applies to both Delhi and Mumbai. DB2019 Starting a Business: India made starting a business easier by fully integrating multiple application forms into a general incorporation form. India also replaced the value added tax with the GST (Goods and Services Tax) for which the registration process is faster. At the same time, Mumbai abolished the practice of site inspections for registering companies under the Shops and Establishments Act. Dealing with Construction Permits: India streamlined the process of obtaining a building permit and made it faster and less expensive to obtain a construction permit. It also improved building quality control by introducing decennial liability and insurance. This reform applies to both Delhi and Mumbai. Getting Electricity: The Delhi Electricity Regulatory Commission reduced charges for low voltage connections. Getting electricity was also made easier in Delhi through a reduction in the time for the utility to carry out the external connection works. Registering Property: Getting Credit: India strengthened access to credit by amending its insolvency law. Secured creditors are now given absolute priority over other claims within insolvency proceedings.This reform affects both Delhi and Mumbai. Paying Taxes: India made paying taxes easier by replacing many indirect taxes with a single indirect tax, the GST, for the entire country. India also made paying taxes less costly by reducing the corporate income tax rate and the employees’ provident funds scheme rate paid by the employer. This reform applies to both Delhi and Mumbai. Trading across Borders: India reduced the time and cost to export and import through various initiatives, including the implementation of electronic sealing of containers, the upgrading of port infrastructure and allowing electronic submission of supporting documents with digital signatures. This reform applies to both Delhi and Mumbai. Employing Workers: India (Mumbai) changed regulations pertaining to weekly holiday work, overtime hours and paid annual leave. Page 122 Doing Business 2020 India DB2018 Starting a Business: India made starting a business faster by merging the applications for the Permanent Account Number (PAN) and the Tax Account Number (TAN), and by improving the online application system. This reform applies to both Delhi and Mumbai. Mumbai also made starting a business faster by merging the applications for the value-added tax and the profession tax. Dealing with Construction Permits: India made dealing with construction permits less cumbersome by implementing an online system that has streamlined the process at the Municipality of New Delhi and Municipality of Greater Mumbai. The online system has streamlined the process of obtaining a building permit, thereby reducing the number of procedures and time required to obtain a building permit in India. Getting Credit: India strengthened access to credit by amending the rules on priority of secured creditors outside reorganization proceedings and by adopting a new law on insolvency that provides a time limit and clear grounds for relief to the automatic stay for secured creditors during reorganization proceedings. This reform applies to both Delhi and Mumbai. Protecting Minority Investors: India strengthened minority investor protections by increasing the remedies available in cases of prejudicial transactions between interested parties. This reform applies to both Delhi and Mumbai. Paying Taxes: India made paying taxes easier by making payment of EPF mandatory electronically and introducing a set of administrative measures easing compliance with corporate income tax. This reform applies to both Delhi and Mumbai. Trading across Borders: India reduced import border compliance time in Mumbai by improving infrastructure at the Nhava Sheva Port. Export and import border compliance cost were also reduced in both Delhi and Mumbai by eliminating merchant overtime fees and through the increased use of electronic and mobile platforms. Enforcing Contracts: India made enforcing contracts easier by introducing the National Judicial Data Grid, which makes it possible to generate case measurement reports on local courts. This reform applies to both Delhi and Mumbai. Resolving Insolvency: India made resolving insolvency easier by adopting a new insolvency and bankruptcy code that introduced a reorganization procedure for corporate debtors and facilitated continuation of the debtor’s business during insolvency proceedings. This reform applies to both Delhi and Mumbai. Employing Workers: India increased the mandatory length of paid maternity. This reform applies to both New Delhi and Mumbai. DB2017 Getting Electricity: India made getting electricity faster and cheaper by streamlining the process of getting a new commercial electricity connection. This reform impacts Delhi. Paying Taxes: India made paying taxes easier by introducing an electronic system for paying employee state insurance contributions. This reform applies to both Mumbai and Delhi. Trading across Borders: India made exporting and importing easier by launching Customs Electronic Commerce Interchange Gateway portal and simplifying border and documentary compliance procedures. This reform applies to both New Delhi and Mumbai. Enforcing Contracts: India made enforcing contracts easier by creating dedicated divisions to resolve commercial cases. This reform applies to both Mumbai and Delhi. DB2016 Starting a Business: India made starting a business easier by eliminating the minimum capital requirement and the need to obtain a certificate to commence business operations. This reform applies to both Delhi and Mumbai. Getting Electricity: The utility in Delhi made the process for getting an electricity connection simpler and faster by eliminating the internal wiring inspection by the Electrical Inspectorate. The utility in Mumbai reduced the procedures and time required to connect to electricity by improving internal work processes and coordination. DB2015 Starting a Business: India made starting a business easier by considerably reducing the registration fees, but also made it more difficult by introducing a requirement to file a declaration before the commencement of business operations. These changes apply to both Delhi and Mumbai. Getting Electricity: In India the utility in Mumbai made getting electricity less costly by reducing the security deposit for a new connection. Protecting Minority Investors: India strengthened minority investor protections by requiring greater disclosure of conflicts of interest by board members, increasing the remedies available in case of prejudicial related-party transactions and introducing additional safeguards for shareholders of privately held companies. This reform applies to both Delhi and Mumbai. DB2013 Dealing with Construction Permits: India reduced the time required to obtain a building permit by establishing strict time limits for preconstruction approvals. DB2012 Paying Taxes: India eased the administrative burden of paying taxes for firms by introducing mandatory electronic filing and payment for value added tax. Page 123 Doing Business 2020 India DB2011 Starting a Business: India eased business start-up by establishing an online VAT registration system and replacing the physical stamp previously required with an online version. Paying Taxes: India reduced the administrative burden of paying taxes by abolishing the fringe benefit tax and improving electronic payment. DB2010 Resolving Insolvency: India made resolving insolvency easier by increasing the effectiveness of processes and thereby reducing the time required. DB2009 Trading across Borders: India reduced the time for exporting by implementing an electronic data interchange system. DB2008 Getting Credit: India strengthened its secured transactions system by launching a unified and geographically centralized collateral registry and started to provide credit information on firms at the private credit bureau. Trading across Borders: India made trading across borders easier by introducing ICEGATE—an electronic data interchange system making it possible to lodge customs declarations through the internet and facilitating the operation of a risk management system, an electronic payment system and an electronic manifest system that allows shipping lines to submit their cargo manifest in advance. Page 124 Doing Business 2020 India Page 125