[Abhijnan Jha is a Partner and Urvashi Misra a Senior Associate at AZB & Partners, New Delhi] It is trite law that where a statute prescribes something to be done in a particular manner, then it ought to be done in that manner alone and not in any other manner. This is a well-recognized position, with courts having the duty to filter out any misguided attempts by litigants to bypass statutory...
Holding-Subsidiary Relationship: The Legal & Regulatory Architecture
[Bharat Vasani is Senior Advisor – Corporate Laws and Miloni Mau an Associate in the General Corporate Practice, both at the Mumbai office of Cyril Amarchand Mangaldas. An earlier version of this post was published on the Cyril Amarchand Mangaldas Blog] As their businesses grow, companies operate through their subsidiaries for various reasons such as flexibility in operation of different units...
Reining in Big-Tech Ex-Ante : The Indian Edition
[Manjushree RM (Senior Resident Fellow), Meha Chandra (Project Fellow), Anuradha Bhattacharya (Project Fellow), Vallari Dronamraju (Research Fellow) and Urvi Pathak (Research Fellow) are with Vidhi Centre for Legal Policy, and were engaged by the Ministry of Corporate Affairs in preparing the CDCL Report] On 12 March 2024, the Committee on Digital Competition Law (‘CDCL/ Committee’) presented its...
Recall of Approved Plan: Reconsideration of Judgment?
[Aditya Vaid is a third-year law student at Jindal Global Law School, Sonipat and Hrishikesh Goswami is a third-year law student at the Gujarat National Law University, Gandhinagar] The corporate insolvency resolution process (‘CIRP’) is a recovery mechanism through which the creditors of a corporate debtor may seek to rehabilitate the company with a view to recovering their debt. The CIRP aims...
Venture Capital’s Tryst with Tax: Revisiting the Debate on Carry
[Bhaskar Vishwajeet and Abhinav Shankarraman are final year law students at Jindal Global Law School] The Karnataka High Court recently overruled a Customs, Excise, Service Tax Appellate Tribunal (“CESTAT”) order (page 4) on the service tax status of venture capital trusts (“VCTs”), declaring that service tax is not applicable to VCTs as they are pass-through structures. The authors argue that...
Interim Measures in Oppression & Mismanagement Proceedings: The Encroachment of Third-Party Rights
[Abhijnan Jha is a Partner, Urvashi Misra a Senior Associate, and Anant Narayan Misra an Associate, all at AZB & Partners, New Delhi] In contentious corporate litigation, much depends on interim measures. A victory at the interim stage becomes a turning point for most parties. This is particularly true for shareholder disputes, which become a battle to retain the company’s control. A...
The Uncertain Fate of Arbitrations Terminated under Section 29A of the Arbitration and Conciliation, 1996
[Sanjana Muraleedharan is a Senior Associate at Keystone Partners, Bengaluru] A division bench of the Supreme Court is set to examine the position on termination of the mandate of an arbitrator where the application for extension under section 29A(5) of the Arbitration and Conciliation Act, 1996 (‘Act’) was not filed prior to termination of the mandate. The Special Leave Petition in Rohan...
Settling the Jurisdictional Conundrum: Navigating the App Developers v. Google Judgement
[Sanjana Rebecca Samuel is a 4th year B.A., LL.B. (Hons.) student at Symbiosis Law School, Pune] On 19 January 2024, the Madras High Court dismissed the suit filed by several app developers against Google. The developers asserted that Google’s policies within the Play Store contravened stipulations and directives outlined in the Payment and Settlement Systems Act, 2007 (“PSS Act”). Additionally...
Can SAT Function Without the Presence of a “Judicial Member”? Has the Conundrum Been Resolved?
[Ravishekhar Pandey and Amarpal Singh Dua are independent securities law practitioners] On 29 December 2023, Justice Tarun Agarwala retired and demitted office as the Presiding Officer (PO) of the Securities Appellate Tribunal (SAT), which hears appeals against orders passed by the Securities and Exchange Board of India (SEBI), the Insurance Regulatory and Development Authority of India (IRDAI)...
Navigating the Choppy Waters of Anti-trust Regulation in the Maritime Industry
[Aditya Trivedi is an Associate with the Competition Advisory Services (India) LLP, New Delhi and an LL.M. student in Competition Law & Economics at the Brussels School of Competition and Vanshika Arora is a 4th Year B.A.LL.B. student at the Army Institute of Law, Mohali] In the vast tapestry of India’s economic landscape, the maritime sector stands as a pivotal contributor, shaping the...
Inherent Powers of the NCLT to Recall an Insolvency Resolution Plan
The Insolvency and Bankruptcy Code, 2016 (IBC) lays emphasis on an elaborate process by which a corporate insolvency resolution plan (CIRP) can be proposed, considered, decided, and approved. The principal actors involved in the process include the resolution professional, the committee of creditors (CoC) and the adjudicating authority (being the National Company Law Tribunal (NCLT) and, on...
Will Insolvency Drown Under the Crown’s Weight? Addressing Differential Debt Treatment under the IBC
[Deep Dighe is an Advocate practicing in the Bombay High Court] The question of statutory dues or crown debts (as they were previously known under the colonial regime) and their interplay with the corporate insolvency law in India has been an issue that has drawn the attention of all stakeholders to it. Much ink has been spilled about the contrasting Supreme Court judgments on the treatment of...
Open Questions on RBI’s Enforcement Actions in Indian Fintech
“God may be in the details, but the goddess is in the questions. Once we begin to ask them, there’s no turning back.” – Gloria Steinem Over the last month and a half, the enforcement actions of the Reserve Bank of India (RBI) with respect to Paytm and in relation to certain payment arrangements through corporate cards have raised substantive questions of law, facts and due process. This...
Electoral Bonds Deemed Unconstitutional: Granular Electoral Finance Reforms Needed?
[Bhaskar Vishwajeet and Abhinav Shankarraman are final year law students at Jindal Global Law School] The recent judgement of the Supreme Court in Association for Democratic Reforms v. Union of India has stirred the hornet’s nest on electoral financing in India. At the heart of this judgement lay the controversy surrounding unlimited corporate funding of political parties. The judgment of the...
SEBI Greenlights Pledging of Equity Investments by Alternative Investment Funds
[Prachya J. Bhattacharya and Sahsransh Pandey are 3rd year students at Gujarat National Law University, Gandhinagar] In an effort to foster the consistent growth of alternative investment funds (AIFs), the Securities & Exchange Board of India (SEBI) introduced a consultation paper on 2 February 2024. The paper aims to allow AIFs to create encumbrance on their equity holdings in infrastructure...
Disclosure Dilemma: Streamlining Disclosures for Smoother FPI Flow
[Isha Sharma is a 4th year B.A., LL.B. (Hons.) student from Gujarat National Law University, Gandhinagar] The Securities and Exchange Board of India (“SEBI”), as the primary authority overseeing the Indian securities market, regularly reviews and updates regulatory frameworks to harmonize the evolving market dynamics with the best global practices. In 2023, SEBI introduced significant amendments...
Whether a “Sale of Shares” Amounts to a “Sale of an Undertaking”: Has the Conundrum Been Resolved?
[Bharat Vasani is Senior Advisor – Corporate Laws and Varun Kannan an Associate in the General Corporate Practice, both at the Mumbai office of Cyril Amarchand Mangaldas. An earlier version of this post was published on the Cyril Amarchand Mangaldas Blog] “What would constitute an ‘undertaking’ of a company” has been among the most hotly debated topics in the history of India’s company law regime...
Personal Data Breach Notifications as UPSI(?): A Safe Haven for Insider Trading
[Fathima Rena Abdulla is a 3rd-year B.A., LL.B. (Hons.) student at NUALS, Kochi] Stock market responses to cybersecurity breaches have consistently triggered negative outcomes and, consequently, opportunistic insider trading. Through timely selling before public breach announcements, insiders employ various tactics, including buying put options, making profits, or avoiding losses from the...
Geopolitical and National Security Considerations in Outbound Foreign Investment
[Rajat Sethi is a Partner and Deborshi Barat a Counsel at S&R Associates, Advocates] In a world characterized by geopolitical shifts and heightened national security concerns, the realm of foreign investments is undergoing a profound transformation. Disruptive events, evolving alliances and strategic recalibrations are increasingly influencing how nations perceive the risks and opportunities...
Interpretation of Section 30(2) of the IBC: Rights over Prudence?
[Saksham Chaturvedi is a 5th year law student at National Law University, Odisha] A division bench of the Supreme Court in DBS Bank v. Ruchi Soya has referred an issue concerning the interpretation of the amended section 30(2)(b) of the Insolvency and Bankruptcy Code, 2016 (IBC) to a larger bench. The question before the bench in DBS Bank was whether, as per the amended section 30(2)(b)(ii) of...
Business Judgment Rule: The Indian Context
[Bharat Vasani is Senior Advisor – Corporate laws at the Mumbai office of Cyril Amarchand Mangaldas. An earlier version of this post was published on the Cyril Amarchand Mangaldas Blog] The business judgment rule is a legal presumption evolved by Delaware courts. The presumption is that while making business decisions, directors of a company act in good faith, on an informed basis and in the...
Navigating the Regulatory Maze: The Imperative for Harmonized Decision-Making in SEBI
[Philip Oommen is a lawyer based in Mumbai, and a graduate of the National Institute of Securities Markets] The regulatory landscape of the Indian securities market currently exhibits a noticeable lack of uniformity, as demonstrated by the divergence in decisions rendered by the Securities and Exchange Board of India (“SEBI”). This divergence in decision-making underscores the inherent...
Revolutionizing Trade Settlement: SEBI’s Progressive Push for T+0 and Instant Settlement
[Smruti Kulkarni and Manas Rohilla are 3rd year students at Gujarat National Law University, Gandhinagar] On 22 December 2023, the Securities and Exchange Board of India (SEBI) issued a consultation paper on “Introduction of optional T+0 and optional Instant Settlement of Trades in addition to T+1 Settlement Cycle in Indian Securities Markets”. The paper analyses feasibility and desirability of...
Regulating the Unregulated: RBI’s Proposed Regulatory Framework for the Fintech Sector
[Daksh Kasliwal and Shubham Sehgal are 3rd year law students at Gujarat National Law University, Gandhinagar] Over the past decade, India’s fintech industry has been experiencing a remarkable growth trajectory and has emerged as the third largest fintech economy in the world. WEF, in its study, has placed India alongside the United Kingdom, the United States, and Singapore as “the most...
Navigating Vulnerabilities: SEBI’s Circular on Trading Account Security
[Snigdha Dash is a 3rd year B.A.LL.B.(Hons.) student from National Law University, Odisha] The market’s abundance of traders, providers, platforms, brokers, and communication channels has created an environment susceptible to potentially malevolent activities. Exploiting vulnerabilities to gain unauthorized access to trading accounts and execute illicit transactions, such as in currency trading...
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