The concept of sexual harassment at workplace in India often connotes sexual offensive behavior, power exploitation or discriminatory background. Such harassment can be in a form of a single act or a continuous one. Sexual Harassment is repeatedly confused with physical actions only; however the judicial system has brought under its ambit mental agony too but without victim’s consent. Given the fact that women are working in several corporate offices, financial institutes and NGO’s with highly designated posts,the offence of sexual harassment are still in existence and the number of such offence are not uncommon.
Legislative Framework
Prior to the amendment in 2013, the Indian Penal Code, 1860 (IPC) remotely dealt with the offence of sexual harassment. Only certain related laws were framed as offences that either amount to obscenity in public or act that are seen to violate the modesty of women under sections 294, 354 and 509 of the IPC.
The realm of judicial interpretation widened and the subject ‘sexual harassment of women at workplace’ was addressed in the landmark case of Vishaka & Ors vs State Of Rajasthan & Ors JT 1997 (7) SC 384) wherein, the Hon’ble Supreme Court laid down detailed guidelines for controlling the offence of sexual harassment of women at workplace. However, the said guidelines were not effective in achieving gender empowerment and equality which the said guidelines aimed of.
In April 2013, IPC was amended vide the Criminal Law (Amendment) Act, 2013, which enlists new offences like, acid attack, sexual harassment, voyeurism, stalking have been incorporated into the Indian Penal Code.
Further, in December 2013, the Government of India has made effective“The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013”(the Act).The Act proposes a definition of sexual harassment, which is as laid down by the Hon’ble Supreme Court in Vishaka v. State of Rajasthan (supra). Additionally, it recognizes the promise or threat to a woman’s employment prospects or creation of hostile work environment as ‘sexual harassment’ at workplace and expressly seeks to prohibit such acts. The Government of India has also notified theSexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Rules, 2013 which provides the procedural aspects of the new law.
Employer’s Obligations under the Act
The objective of the Act is to provide protection against sexual harassment of women at workplace and for the prevention and redressal of complaints of sexual harassment and for matters connected therewith or incidental thereto. The ambit of the Act is wide and is applicable to both public and private sectors whether organized or unorganized.
Under the Act, a workplace also covers, within its scope, places visited by employees during the course of employment or for reasons arising out of employment – including transportation provided by the employer for the purpose of commuting to and from the place of employment.
The definition of ‘employer’ Under the Act, includes the head of the Government department/organization/institution/office/branch/unit, the person responsible for management/supervisions/control of the workplace, the person discharging contractual obligations with respect to his/her employees and in relation to a domestic worker the person who benefits from that employment.
Section 2 (n) of the Act defines sexual harassment as “includes any one or more of the following unwelcome acts or behavior (whether directly or by implication) namely:
- physical contact and advances; or
- a demand or request for sexual favour; or
- making sexually colored remarks; or
- showing pornography; or
- any other unwelcome physical verbal or non-verbal conduct of sexual nature.
The redressal instrument provided in the Act is in the form of Internal Complaints Committee (ICC) and Local Complaints Committee (LCC). All workplaces employing 10 or more than 10 workers are mandated under the Act to constitute an ICC. The ICC constitutes of 4 members in the committee under the Chairpersonship of a senior woman employee and will include 2 members from amongst the employees preferably committed to the cause of women or has experience in social work/legal knowledge and includes a third party member (NGO etc) as well.
Moreover, the Act further provides that if an employer fails to form ICC or does not comply with any provisions contained therein, the Act prescribes a monetary penalty of up to INR 50,000/-.
It may be too early to comment whether the Act will achieve its objective of women empowerment and gender equality or not, however, it appears that the obligations of an employer under the Act will ensure that women are protected against sexual harassment at all the work places, be it in public or private.
Real Estate Investment Trusts Introduced In India
Real Estate Investment Trusts or REITs is an investment vehicle through which monies of investors is gathered and invested primarily in completed real estate assets such as buildings, malls etc. These provide an avenue for investors, who benefit by receiving regular income as well as developers (as an exit option) who are able to channel such monies collected into building for commercial purposes. Framework for REITs exists globally in several countries including Australia, the United States of America, Japan and Singapore. In addition to other advantages, REITs help in bringing about transparency and accountability in the real estate sector.
Need For REITS In India
The real estate sector has grown exponentially in India especially in the last decade. Rapid economic growth largely coupled with the expansion in the corporate sector has led to an increased demand/requirement for commercial buildings or spaces. Keeping the above mentioned factors in mind as also to keep up with global practices, the SEBI (Securities and Exchange Board of India) drafted the SEBI (Real Estate Investment Trusts) Regulations, 2013. SEBI had made a similar attempt in 2008 only to withdraw it later. This move from SEBI has been received positively in the market especially in times of economic slowdown, wherein there’s scarcity of funds and the real estate market has suffered too as a direct result of market factors.
Salient Features of the Regulations
At its initiation stage now, REIT regulations seem to be catering mostly to high net worth persons and institutions; an effort to safeguard investors as this is an investment with high risks. The regulations also seem very akin to that of IPOs.
- Structure
REITs in India must be set up as a ‘Trust’ under the Indian Trusts Act, 1882 and are prohibited from launching any schemes. The parties so associated would consist of a trustee (registered with SEBI), sponsor, manager and principal valuer. REITs are required to be registered with SEBI. - Offering and Listing of Units
- Initially, RTEIs can raise funds through an initial offer and later, through follow-on offers.
- The regulations have made the listing of units for all REITs compulsory.
- It specifies that the size of the assets under RTEI shall not be less than a 1000 crore ensuring the entry of only established players in the market.
- Specifies a minimum offer size of Rs. 250 crore and a minimum public float of 25% of the value of the REIT, this again to ensure larger public participation.
- Scope of Investment & Dividends
- SEBI has framed the regulations in consonance with REIT policies across the globe. It has therefore mandated that – at least, 90% of the value of REIT assets must be invested in completed revenue generating properties; while the remaining 10% may be invested in developmental properties.
- It has also mandated the distribution of 90% of the income after tax to ensure regular income of the investors.
- REITs are permitted to invest directly or through SPVs, requiring the SPVs to hold at least 90% of the assets directly and REITs to have direct control over such SPVs.
- REITs have been prohibited from investing in vacant and agricultural land or mortgages (other than mortgage backed securities).
- Criterion for Sponsor and Manager of REIT
Apart from some responsibilities entrusted on the trustee, manager etc, SEBI’s regulations also creates an eligibility criterion for the appointment of the sponsor and the manager who must all be separate entities.
Sponsor:-- Must have a net worth of at least rupees 20 crores on a consolidated basis.
- Must hold at least 15% of the REIT assets at all times and should hold at least 25% of the units of the REIT before the initial offer.
- The sponsor must have a minimum of 5 years experience in the real estate industry.
Manager:-
- Must have a net worth of at least rupees 5 crores. In addition, must have a minimum of 5 years experience in property/fund management or real estate development.
- Valuation of Assets
SEBI has incorporated a sound valuation framework in its regulations. It has laid down the following:- It has mandated that a physical inspection of the properties be carried out at least once a year. Also, NAV is to be declared twice a year.
- Mandated that a complete valuation be carried out for the purchase of any new property (transaction not exceeding 110%) or sale of existing property (transaction must be at least 90%).
- Transparency & Disclosure
The SEBI through these guidelines has sought to address most aspects concerning and governing REITs. One such facet is the importance of ensuring transparency and therefore, detailed disclosure requirements have been laid down- in party related transactions, focus on valuation of assets and their disclosures, specific disclosure requirements for reports sent to the investors. The manager and the trustee have also been conferred with certain responsibilities with regard to ensuring the making of correct disclosures. Schedule III of the regulations deal specifically with mandatory disclosures.
Other Concerns
- Uncertain title- Several experts and others have voiced their concern over the lack of clear title and incomplete contracts which often impedes the growth of the real estate sector. Such problems enhance the risk undertaken by the investors.
- Taxation of REITs income- Also, the regulations or SEBI hasn’t clarified yet on the taxation scheme or stamp duty for REITs or its investors. Clarity on these matters will ensure proper implementation of the Regulations set forth as of now.
Thus, we find that REITs will be a boosting factor in the growth of real estate in the country, empowering investors and developers both to benefit. Once FDI is wholly implemented, the sector is likely to gain from foreign investors considering the large size of units being offered as of now under REITs.