Blog Posts
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Framework for SME Exchange
[Posted by Umakanth Varottil] After making a proposal nearly two years ago for the establishment of a separate stock exchange for small and medium enterprises (SMEs) to enable them to access the capital markets, SEBI has recently established the legal framework for achieving the same either through promotion of dedicated exchanges and/or dedicated platforms of…
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The Corporate Veil and Arbitration Clauses
[Posted by V. Niranjan] With the rapid growth of group companies in India over the past decade, it has become commonplace for a commercial transaction to be routed through several entities in one group. In cases where some of those entities have entered into agreements containing an arbitration clause, and others have not, the question…
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Proposal for Streamlining Stamp Duty on Mergers, etc.
[Posted by Umakanth Varottil] The issue of applicability of stamp duty to a scheme of arrangement (merger/ amalgamation, demerger, reconstruction or otherwise) effected with the sanction of the High Court under sections 391 to 394 of the Companies Act, 1956 has always been a vexed one. As regards stamp duty legislation more generally, several states…
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‘Sweat Equity’ vs. ‘Sweet Equity’ – a Legal Perspective
[Posted by Umakanth Varottil] (In the following post, Rohan Bagai analyzes the regulations relating to ‘sweat equity’ under Indian company law in the light of recent events surrounding the Indian Premier League. Rohan is a corporate lawyer at one of the leading law firms in India. He holds a Master of Laws (LL.M.) degree from…
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Bombay HC on the Binding Nature of AAR Ruling
[Posted by Umakanth Varottil] (The following post has been contributed by Ravichandra S. Hegde of J. Sagar Associates) The Bombay High Court on April 29, 2010, while allowing a Writ Petition against the Income Tax Department has ruled on the binding nature of the decision rendered by the Authority for Advance Rulings (“AAR”). The Court…
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Further Comments on the NCLT judgment
[Posted by Mihir Naniwadekar] In an earlier post, I had noted that a Constitution Bench of the Supreme Court has upheld the establishment of the National Company Law Tribunal and the National Company Law Appellate Tribunal, in an appeal filed by the Union of India against a judgment of the Madras High Court. The judgment of the…
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Nasscom on Corporate Governance
[Posted by Umakanth Varottil] In early 2009, immediately following the accounting fraud at Satyam, several committees and task forces were constituted to review corporate governance norms and practices in India. Some of them issued their recommendations late last year. These include a report by a task force constituted by the Confederation of Indian Industry (CII)…
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ECB Process for Infrastructure Finance Eased
[Posted by Umakanth Varottil] The Reserve Bank of India has issued a circular bringing external commercial borrowings (ECBs) by designated Infrastructure Finance Companies (IFCs) within the automatic route subject to certain limits. The relevant portion of the circular is extracted below: On a review of the policy, it has been decided to modify the extant…
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Nomination vs. Succession on Shares
[Posted by Umakanth Varottil] In his column in the Business Standard, guest contributor Somasekhar Sundaresan analyzes a recent judgment of the Bombay High Court that establishes the superiority of the nomination process over succession (whether testamentary or otherwise) in respect of shares of a company. He observes: The law on nomination of shares held in…
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Supreme Court upholds NCLT
[Posted by Mihir Naniwadekar] The Business Standard reports that the Supreme Court of India has upheld the validity of the National Company Law Tribunal. A Constitution Bench of the Court delivered the judgment more than a year after hearing arguments on an appeal filed against a decision of the Madras High Court in R. Gandhi v. Union of India. In an earlier post, I had…