What is a Consulting Agreement?


Consulting Agreements is an engagement between a consultant and a client for availing certain specified services for a specified period of time. It sets out the services and obligations that exist between the company and the consultant.
This agreement will set out clearly that the consultant is not an employee of the company. The Consultant will provide only specific service to the business for the specified term. Once the contract term has expired the relationship will end.
Benefits of entering into Consulting Agreement
Execution of standard agreement is an important tool for managing a consulting business. Consulting agreements varies across different services and sectors.
 Written description of the services is always a welcome option to avoid the disputes
 Written agreement provides clarity between the parties in respect of the job and work assigned
 Executing agreement before performing prevents disappointment or confusion between the parties of what kind of work is to be don or not done
 Executing agreement helps in building relationship because Consulting Agreement clearly spells out that the consultant is an independent consultant and not an employee.
Signing of Consulting Agreement
Consulting Agreements are signed by the prospective consultant and an authorized representative of the company.
What Does A Consultancy Agreement Usually Cover?
Before entering into any kind of Agreement, parties needs to be cautious in order to avoid the uncertainties in future. So, following are the terms that should be incorporated into any consulting agreement at the initial level only.
1. Scope of the services
This is one of the important clause that must be incorporated in a Consulting agreement which defines what services will be provided and not provided by the consultant for their business. It needs to specific. The more detailed consulting contract is, the lesser wil be the chances of dispute in the future.
2. Terms of Payment
Everyone wants to be paid for their services. By clearly defining that whether payment is to be in lump sum or made in installments, you are avoiding the situation which could lead to disputes in future
3. Reimbursement of Expenses
While executing an agreement ensure for incorporating a clause for reimbursement of all the expenses reasonably incurred in the performance of the services provided by the consultant.
4. Duration and it renewal
The time from which the consultant will start providing the services should be clearly defined. It should also provide that the same may be renewed on mutually acceptable terms.
5. Dispute resolution or mediation
The parties should always pay careful attention to insert a dispute resolution clause in your consulting agreement that requires both the parties to pursue mediation and dispute resolution mechanism in case of dispute before proceeding for legal action.
6. Liability Clause
This clause must be stated in detail that to what extend the consultant will be liable to the misconduct due to his carelessness or negligence.
7. Termination Clause
In case of breach of confidentiality, or conduct of illegal activity, the company/ client has a right to terminate the services of consultant by giving a notice period. By inserting this clause the parties shall be relieved from future performance of their rights and obligations under this agreement .
8. Confidentiality
This is the most important clause of any agreement which clearly spells out on the part of consultant that all confidential information related to financial status, projections etc of the client shall be kept confidential without their knowledge and consent. In case if disclosed under the requirement of law/regulation or any order of any court/ authority it should be clearly specified in the agreement.
9. Governing Law
Agreement must provide that the agreement shall be governed by and interpreted in accordance with the laws prevailing and subsisting in India
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What is joint venture agreement?


A joint venture is generally understood as technical and financial collaboration for the purpose of some projects fulfillment with existing companies. Companies lacking in some aspects such as technology, knowledge, assets or reach to the market are generally involved in joint ventures with other company because they are not able to achieve its goal on its own. Collaboration allows the first party to have an access to the resources of the other party without any expenditure for obtaining it.
Indian joint ventures are usually formed by two or more individuals/companies, one of whom may be non-resident, who collaborate to form an Indian private/public limited company with mutual contribution in the share capital
Joint ventures exist in the form of companies, partnerships or joint working agreements.
Whether Approval is required from RBI for Investment in India?
FDI up to 100% or certain percentage is allowed under automatic route in those sectors which are not defined in the FDI policy of Indian Government
There are also some other sectors in which approval from the concerned Industry Ministry is required for investment. Before 24th May, 2017 all the approvals were handled by the Foreign Investment Promotion Board (FIPB).
What is a Joint venture Agreement?
A Joint Venture Agreement is a legal document where two or more entities combine to do business or undertake an economic activity together. The parties either agree to form an agreement without incorporation of new entity but with the common intention of running a business or create a new entity by contributing equity and share the revenues, expenses and control of the enterprise in the proportion of their capital contribution.
Basic features of entering into Joint venture Agreement
§  Contribution by partners of money, property, effort, knowledge, skill or other assets to the common undertaking.
§  Right of mutual control or management of the property in enterprise.
§  Right to share in the profit and loss of the property
Key questions that parties entering into Joint Venture Agreement should ask
§  What business will the new company / LLP Firm be engaged in?
§  How will the Board of Directors be constituted?
§  How will the Board of Directors decide matters – by majority vote / by consensus?
§  Who will be the Chairman, MD of the company and what will be there powers?
§  Finance decisions will be taken by?
§  What will be the Exit Route for one or both of the promoters / partners?
§  What happens after the promoters / partners fall out?
§  How to decide the price of equity shares / value of enterprise at the time of separation?
Clauses of Joint Venture Agreement
There is no legally prescribed format for a Joint Venture Agreement in India.
However, it is advisable for a joint venture agreement to have the following clauses:
·        Object and scope of the Joint Venture
·        Equity participation clause of both the parties if joint venture is equity based
·         by local and foreign investors and agreement to a future issue of capital
·        Financial arrangements between both the parties
·        The composition of the board and management agreements
·        Specific obligations
·        Provisions for distribution of profits
·        Transferability of shares in certain circumstances
·        Termination of the agreement by exit of the parties
·        Restrictive covenants on the company and the participants
·        Appointment of CEO/MD
·        Anti-compete clause
·        Confidentiality
·        Indemnity Clause where both parties may indemnify each other against negligence, and violation of the JV agreement
·        Duration of the Agreement
·        Dispute Resolution
·        Applicable law
·        Force Majeure etc.
The above list is not exhaustive. Company may vary the agreement.
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Expanding your business globally by importing and exporting goods and services?


Stuck with the compliances, permissions, license from the government?
There are various compliances for doing the same under different laws but herein this article we will discuss on import and export code registration i.e., obtaining IE Code
What is import export code?
It is a 10-digitunique code required to be obtained from Directorate General of Foreign Trade (DGFT) under Ministry of Commerce and Industry, Government of India with a permanent validity for taking your business at a global level.
WHO IS REQUIRED TO APPLY FOR IE CODE REGSITRATION?
In case of import:
1.      When the importer has to clear his shipment from the customs, the custom authorities require IE code
2.      When the importer deals with the bank for the payment of money, Banks require IE code
In case of export:
1.      When an exporter sends the shipment. It is required by the custom port
2.      When an exporter receives money in foreign currency in his bank account, it is required by the Banks
WHO IS EXEMPTED FROM OBTAINING IE CODE?
Persons / Organizations dealing in Import & Export would require to apply for Import Export Code (IEC) registration. But there are some categories defined by DGFT, which are exempted from taking this code.
1.      When the import/ export is done for the personal use and not for the commercial purpose.
2.      When the import/ export is done by the government department and notified charitable organizations.
Note: In case of import or export of services or technology IEC registration is necessary only when the service or technology provider is taking some benefit granted under the foreign trade policy to them or is dealing with specified services or specified technologies.
WHO IS REQUIRED IE CODE?
1.      Individuals
2.      Proprietorship firm
3.      Partnership firm
4.      LLP
5.      Company
6.      HUF
7.      Government undertaking
8.      Registered trust and society
9.      Other entity
DOCUMENTS REQUIRED FOR IEC REGISTRATION
§  PAN issued by Income Tax Authorities.
§  passport Size photograph of the applicant
§  Banker’s certificate in the specified format
PROCESS FOR IEC REGISTRATION
1.      For filing the application you need Class 2 or class 3 Digital signature of the authorized person
2.      Attachments with the application like PAN Card of applicant, passport Size photograph of the applicant and cancelled cheque/Bank certificate required. If the applicant is NRI, RBI approval letter needs to be mandatorily attached.
3.      Visit the website of DGFT and login by entering the PAN. After completion of the process of entering OTP sentto mobile and e-mail, fill up the application and upload the documents.
4.      After successfully filling of application attach DSC of the applicant and submit the same along with the fees prescribed by the government.
5.      Generally, IEC Certificate is issued within 2-3 business, if no discrepancy is found in the application.
CHANGES IN IEC WITH THE INTRODUCTION OF GST
With the Implementation of GST, Government of India through DGFT, in its effort for ease of doing business in India and keeping the identity of person uniform, vide its notification dated 12th June 2017, notified that any person having GSTIN can import or export, into or from India,by declaring the GSTIN at the time of import or export.
Additionally, for the entities who are not registered under GST because of its threshold limit, may use their PAN as their IECfor which application should be made to DGFT for authorizing PAN of Applicant as IEC.
Further, for the existing IEC holders, necessary changes in the system are being carried out by DGFT so that their PAN becomes their IEC. So, IEC holders are supposed to quote their PAN for all the documentation done w.e.f,12th June 2017.
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What is a Residential Rental Agreement?


The residential rental agreement is usually defined as a written document that exists between the owner of a property and a renter who desires to own temporary possession of the property of the landlord.
It sets out the foundations between landlords and tenants who conform to follow in their rental relationship. It's a legal contract that is choked with crucial business details, like how long the tenant will reside within the property and also the amount of rent due every month.
Types of Rental Agreement
The agreement entered between landlord and tenant is of 2 types depending on the laws to abide by:
1.     11 months Rental agreement
One of the foremost common options which deal with getting into a property rental deal is that the prevalence of the eleven-month rental agreements. This kind of agreement is most preferable by landlord because of the laws which more in his favour. It is a comprehensive agreement, protecting the rights of each landlord. 11 months agreement is just like a license for the tenant to occupy the premises for a short duration.  It provides the flexibility to landlord to take more measures to take in case of eviction of tenant from the property
2.     Over 11 months Rental Agreement
Rental Agreement that is over twelve months has to be compelled to abide by strict rent management laws that are largely favorable to the tenants, which is the reason due to which this type of agreement is not much preferable by landlord. Also, the right to ownership of the property gets transferred from the landlords to the tenants for an indefinite period which is why most of the tenants refuses to vacate and it becomes difficult for landlord to evict the tenant.
However, at the expiration of the above agreement there is an option for both landlord and tenant to renew the agreement.
What are the documents required for Residential Rental Agreement?
Mainly Aadhar card and PAN card being valid proof shall be required of all parties (Landlord, Tenant and a pair of witnesses) for cross verification.
What should a Rental Agreement contain?
A rental agreement shall include the terms and conditions on which the property is rented. 

1.     TENURE OF PROPERTY:  The tenure of the property for which it is made between landlord and tenant should be clearly specified
2.     RENT VALUE AND DATE OF DEPOSIT: The amount which a tenant has agreed to pay to landlord every month should be clearly specified. Also the date upto which rent value should be deposited should be mentioned along with the penal charges, if not paid within term defined
3.     SECURITY AMOUNT: Upon execution of the agreement, Tenant deposits with Landlord a security deposit which is refundable at the expiration of term.
4.     REFRESHMENTS: The rent agreement could also mention the facilities, such as parking space or the usage of society’s gym, or other refreshments included in the rent.
5.     MAINTENANCE CHARGE:  There are additional monthly charges paid for the maintenance. A tenant should be well aware of the same.
6.     NOTICE PERIOD: The agreement should also specify the notice period and penalty for cancelling the agreement without completing the specified period.
7.     RENT ESCLATION CLAUSE: This clause should be checked by the tenant that landlord might increase the rent because of the increase in the rentals and at what certain percentage it would be increased.
  1. SALE OF HOUSE: The agreement should also specify the clause for sale If the owner decides to sell the house during the term of the rent agreement.

  2. ACCESS TO PROPERTY TAX: Tenant has a right to access the documents which state the property tax has been paid by the landlord. 

10.  NUMBER OF OCCUPANTS: This clause should specify in order to avoid the Tenant agrees that the House shall be occupied by no more than
11.  UTILITIES: Tenant shall be responsible for paying for all minor repair work for installed electrical appliances required on the premises.
  1. GOVERNING LAW: It is to be agreed by both the party that this agreement shall be governed by, construed, and enforced in accordance with the laws of the [State of Governing Law].
The above list is not exhaustive. The terms of Rental Agreement varies.
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What is “Investor pitch deck”?


This article is meant for the ‘startups’ who wish to enter into the market after having the sound business plan and wants to raise the funds for bringing their plans into reality. But the first step in order to approach is preparing the ‘Investor pitch deck’.
What is “Investor pitch deck”?
Have you completed with market research and ready to start with the innovative idea
AND
Feel that you’re ready to raise funds for your business
Alright! Now you need to prepare your sound business model and realistic future plans and showcase your company’s ideas, product, and technology through presentation to the investors in support of your need for investment.
Startups prepare a “pitch deck” to present their business plan to prospective venture capital investors.
Investors who will be ready to invest in your business will also raise questions such as:
§  Why Your Startup Is Different and unique?
§  Why you’re a Solid Investment for them?
§  How they know that You're Credible and
§  How They Can Trust You?
In order to be answerable for above questions, it’s crucial for the startup to nails its “investor pitch deck” which should highlight your Company’s strength.  It consists of 15-20 slides of Power Point presentation.
Why startups needs to prepare pitch deck
If you need to raise funding from Venture capitalists for your startup, the first step is to create a pitch deck i.e., a brief presentation that provides investors with an overview of your business modelso it is imperative for the startups to be strategic in their approach and must have deep understanding of dynamic market and competition
For plunging into the market for startups,funds are needed to turn their business ideas into reality. Funds requirement may vary but mainly funds are required for setting up office, increasing their range of products and services, buying machineries, paying rents, etc.
Generally new business has to face entry barriers like government policies, competition, economies of scale etc. So, funding from the venture capitalists in India can really make their way.
Preparing Investor Pitch Decks
According to market statistics, nine out of 10 startups fail, because of not being able to have sound business model and lack of presentation.
So below are some of the crucial points to remember for framing the precise Investor Pitch deck.
  • Company overview: Summarizing about the business, location etc should be covered up in the slides
  • Company’s purpose and vision: Explain why the business exist, the purpose of their formation
  • Team: Pitch deck should explain about the team who is going to work upon the business model
  • Problems and solution: Explaining about the problems the customers are facing and how you are going to resolve those issues
  • Products: Summarising about what your company’s product or service consists of and why it is unique
  • Financials: Explaining company’s current financial situation but don’t provide excessive financial details in the presentation, as that can be provided in a follow-up.
  • Competitors: The Company’s competitors will always be an issue to investors. So you should explain who are the company’s competitors
  • Technology: The slide of pitch deck should cover company’sbasic technology backbone, Key intellectual property rights
  • Business model: Before investing Investors will definitely wants to understand your business model
  • Marketing Plan: Good marketing plan to get customers or user is always needed, so pitch deck should cover what key marketing channels you will use.
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What is MSME registration?

Micro, Small & Medium Enterprises Development (MSMED) Act, 2006, was introduced to encourage Micro, Small and Medium enterprises and facilitate their development in the competitive markets. The government through various schemes, subsidies and incentives tries to promote such enterprises. Through MSME registration is not mandatory but to avail those benefits MSME Registration is preferred.
What are the criteria for Micro, Small and Medium enterprises?
As per the official notification in February 2018, the classification of the enterprises is now made through‘annual turnover’, unlike earlier which was according to the ‘investment in plant and machinery/ equipments’.
1.      A Micro Enterprise is a unit which has the annual turnover not exceeding Rs. 5.00 crore;
2.      A Small Enterprisea unit which has the annual turnover more than Rs. 5.00 crore but not exceeding Rs. 75.00 crore;
3.      A Medium Enterprisea unit which has the annual turnover more than Rs. 75.00 crore but not exceeding Rs. 250.00 crore.
The above amendment was brought to name the classification growth oriented and align the structure to the new tax regime revolving around GST.
Before Notification
Sr. No.
Type of Enterprise
Manufacturing Enterprises
(Investment in Plant & Machinery)
Service Industry
(Investment in Equipment)
1.
Micro
Does not exceed Rs.25 Lakh
Does not exceed Rs. 10 Lakh
2.
Small
Exceeds Rs. 25 Lakh but does not exceed Rs. 5 Crore
Exceeds Rs. 25 Lakh but does not exceed Rs. 5 Crore
3.
Medium
Exceeds Rs. 5 Crore but does not exceed Rs. 10 Crore
Exceeds Rs. 2 Crore but does not exceed Rs. 5 Crore
What are the benefits of MSME registration?
1)     Collateral free loans up to a limit of 50 lakh.
2)     Various government ministries hold development programs at utmost stage increasing the overall productivity of MSMEs.
3)     Support is provided to new micro and small enterprises. Guidelines on how to start a business assessing loans from banks are also provided.
4)     Government also provides financial assistance for reimbursement of part of one-time registration fee and annual recurring fee for first three years for using bar coding.
5)     The rates of interest on loan offered to MSMEs are comparatively lower.
6)     Businesses registered under MSME are able to obtain government license and certification quicker than the regular process.
7)     MSME registered businesses enjoymultiple income taxes and capital gains tax subsidies from the government.
8)     Enterprises that have MSME Registration Certificate are also eligible to claim for reimbursements of ISO Certification expenses.
These are few benefits and there are plenty more available to MSME registered enterprises which makes the registration desirable for the eligible.
Who is eligible to apply for MSME Registration?
Following can apply for MSME registration:
1.      Proprietary
2.      Hindu Undivided Family (HUF)
3.      Partnership
4.      Co-Operative
5.      Private Limited Company
6.      Public Limited Company
7.      Self Help Group
8.      Others
What details are required to be noted in the MSME Registration Form?
1.      Now adhaar card is now essential for the applicant or the authorized representatives.
2.      Name of the owner
3.      Social Category
4.      Gender
5.      Physically Handicapped status
6.      Legal name of enterprise.
7.      Type of Organization
8.      PAN Number for Co-Operative, Private Limited, Public Limited and Limited Liability Partnership, OPC (optional for remaining types)
9.      Locations of Plant
10.   Official Registered Address
11.   Date of Commencement
12.   Previous Registration Details, if any
13.   Complete Bank Details
14.   Primary activities
15.   National Industry Classification Code/s(NIC Code
16.   Number of persons employed
17.   Investment in Plant & Machinery/ Equipment
18.   The details of the DIC (District Industry Center) nearest to such business.
What are the documents required for the MSME registration?
The entity making the application for MSME/SSI registration has to submit following documents:
1)     Proof of registered address
a)      Allotment letter, possession letter, lease deed or property tax receipt,or a municipal license in the business name or in the name of the proprietor, partner or director of the business, If the premise is self-owned.
b)     Rent receipts or utility bills and a no objection certificate from the landlord is required, If the premise is rented.
2)     Copies of Sale Bill and Purchase Bill:
a)      Entity is required to submit copy of sale bill related to each end product that it will supply.
b)     For each raw material that it will purchase, a purchase bill has to be submitted.
3)     Partnership Deed and Registration Certificate for a partnership firm
4)     Incorporation Certificate, Copy of MoA and AoA, in case of Private Limited Company along with Board’s Resolution authorizing the director to sign the application
5)     Copy of Licenses
6)     Purchase bill of machinery installed
7)     Bank Account Statement
8)     An affidavit of Rs. 10/-non judicial stamp paper duly attested by Notary Public affixed providing the status of machinery installed, power requirement etc.
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