The question of whether the creditors and an insolvent corporate debtor can enter into an out-of-court settlement that results in the withdrawal of the insolvency process has been a vexed one. The issue has received the attention of the Supreme Court on at least three occasions, as previously discussed on this Blog (here, here, here and here). However, as I argue in this column in BloombergQuint...
WhatsApp Leak Case: Powers of SEBI vs Privacy of Individuals
[Nandini Garg is a 4th year B.A., LL.B. (Hons.) student at National Law Institute University in Bhopal] In November, 2017, Reuters reported that the second quarter earnings of 12 companies, including popular blue chips such as Dr. Reddy’s, Cipla, Tata Steel etc., were being circulated on private WhatsApp groups. This prompted the Securities and Exchange Board of India (“SEBI”) to...
“Single-brand” Retail Trading Remains an Ambiguity in the Indian FDI Policy
[Dhanush Dinesh is a III Year, B.A. LL.B (Hons.) student at the National Law School of India University, Bangalore] Introduction Press Note 1 of 2018, amending the 2018 Indian FDI Policy, has been the cause for much celebration amongst foreign-owned entities engaging in single-brand retail trading (“SBRT”). With this press note, the entry route for foreign investment in SBRT has been simplified...
Supreme Court Rules on Mandatory Procedure under the SARFAESI Act
[Partha N. Mansukhani is a Fourth Year B.A. LL.B (Hons.) student at Symbiosis Law School, Pune] The Supreme Court last month in a decision in ITC Limited v. Blue Coast Hotels Ltd. & Ors clarified that section 13(3A) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 (the “Act”) is not merely directory, but in fact mandatory...
Breaking New Ground: The Impact of BCCI v. Kochi Cricket Pvt. Ltd. on the Arbitral Regime in India
[Soham Banerjee is a 4th year student in the B.L.S LLB Program at Government Law College, Mumbai] Introduction A Division Bench of the Supreme Court on March 15, 2018 held in the case of Board of Control for Cricket in India v. Kochi Cricket Pvt. Ltd. that the nature of the Arbitration and Conciliation (Amendment) Act, 2015 (the ‘Amendment Act’) is prospective in its operation and held that it...
CCI’s Order Against Cartel Activities of Airline Companies
[Ayushi Singh is a B.A. LL.B. (Hons.) student at National Law University, Jodhpur] Last month, the Competition Commission of India (“CCI”) passed an order in the matter of Express Industry Council of India vs. Jet Airways (India) Ltd. and Others upholding charges against Jet Airways, SpiceJet and IndiGo Airlines for cartelisation under the provisions of section 3(3)(a) read with section 3(1) of...
Effects of The Specific Relief (Amendment) Bill, 2017 on the Law of Remedies for Breach of Contract
[Radhika Indapurkar is a lawyer based in Mumbai] Section 10 of the Specific Relief Act, 1963 (the “Act”) provides the courts with a discretion to enforce specific performance of contracts (a) in which there exist no standards to ascertain the actual damage caused by non-performance of such contracts, or (b) wherein the act agreed to be done is such that monetary compensation for non-performance...
Insolvency under Section 29A: Pre-Pack Pools & Independent Review of Connected Party Sales
[Rudresh Mandal and Hardik Subedi are 3rd year students of NALSAR University of Law, Hyderabad] While the Insolvency and Bankruptcy Code, 2016 (“IBC”) in section 5(25) initially allowed ‘any person‘ to submit a resolution plan, the moral hazard posed by defaulting promoters buying back the assets of the corporate debtor at steep discounts soon prompted the Government to bar certain...
Supply of Essential Goods or Services under the IBC: Unresolved Issues
[Job Michael Mathew is a IV year student at NALSAR University of Law, Hyderabad] Under section 13(1)(a) of the Insolvency and Bankruptcy Code, 2016 (“Code”), the adjudicating authority is required to impose a moratorium for matters referred to in section 14. Section 14(2) of the Code...
GMR Energy v. Doosan: Pro-Arbitration at the Cost of Sound Reasoning?
[Sathvik Chandrasekhar and Ashwin Murthy are 3rd students at NALSAR University of Law] The decision of the Delhi High Court in GMR Energy v. Doosan (November 2017) is significant on several fronts. One aspect of the judgment that has garnered attention is where the Court, following the position taken in Sasan Power, placed a foreign-seated arbitration between two Indian parties under Part II of...
Testing the Constitutional Validity of the Anti-Profiteering Rules, 2017
[Yash Karunakaran is a 3rd year B.A., LL.B. (Hons.) student at NALSAR University of Law, Hyderabad.] While the aim behind the introduction of the Anti-Profiteering Rules, 2017 was to rein in possible price hikes during the introduction of the General Sales Tax (“GST”) regime, the hastily drafted parent act and the vague nature of the rules themselves have called into question the constitutional...
Viability of Arbitration in Resolving Sports Law Disputes in India
[Advik Rijul Jha is a Third Year Law Student at Jindal Global Law School] In this post, I aim to identify the rising importance of sports law in recent times, and analyse Indian law to determine how disputes arising in this nascent field ought to be dealt with by arbitration and not the normative court litigation process. The resolution of these disputes by arbitration is proposed to be promoted...
Subjectivity or Objectivity? Supreme Court on Implied Terms in Commercial Contracts
[Manjari Rammohan is a 4th year student at School of Law, Christ University, Bangalore] This post seeks to critically analyze the October 2017 judgment of the Supreme Court in Nabha Power Limited v. Punjab State Power Corporation Limited with respect to remedying ambiguous terms in commercial contracts. This case is of vital importance as the Court comprehensively analysed Indian and...
Original Jurisdiction of the Supreme Court in Arbitral Proceedings
[Shubham Jain and Prakshal Jain are V Year B.A., LL.B. (Hons.) students at National Law School of India University, Bangalore] A Constitution Bench of the Supreme Court in a recent judgment in State of Jharkhand v. Hindustan Construction Company (“HCC”) held that even if the Supreme Court retains some degree of control over an arbitration proceeding, it does not become the court of appropriate...
Call for Papers: Insolvency and Bankruptcy Code
[Announcement from Vinod Kothari & Co.] The following are details of a paper writing competition on a topic under the Insolvency and Bankruptcy Code, 2016 (the “Code”), as detailed below: The Code in India makes a distinction between financial creditors (FC) and operational creditors (OC). FCs make a resolution plan; which should bind all- including OCs. FCs sit and decide whether and how...
Qualified Institutional Placements: SEBI Settles the Dust
[Shubham Sancheti is a 4th Year B.A., LL.B. (Hons.) student at NALSAR University of Law, Hyderabad] The Securities and Exchange Board of India [“SEBI”] omitted clause (c) under Regulation 82 of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 [“Regulations”] by way of a recent amendment [“Amendment”]. The provision falls in Chapter VIII of the Regulations which deals with...
Transferability of Winding-up Proceedings from High Court to NCLT
[Dheeresh Kumar Dwivedi is a lawyer at APJ SLG Law Offices New Delhi] The Companies Act, 2013 (“Act of 2013”) was passed with the object of consolidating and amending the law of corporations in India. Before the passage of the Act, the winding-up of a corporate debtor on the ground of ‘inability to pay debts’ was governed by the provisions of sections 433(e) and 434 of Companies Act, 1956 (“Act...
Call for Papers: NALSAR Student Law Review
[The following is an announcement from NALSAR Student Law Review] We are pleased to announce that the NALSAR Student Law Review is now accepting submissions for its upcoming Volume XIII. NSLR is an annual, student-edited, peer-reviewed law journal that is the flagship publication of NALSAR University of Law, Hyderabad, India. We are committed to encouraging and enhancing the quality of legal...
Making Arbitration More Consumer Friendly – The Way Forward in India
[Chandni Ghatak is a 4th year student at National Law University-Jodhpur. A related post on the topic is available here.] The Supreme Court of India has finally clarified as to what prevails in the battle between statutory remedy and arbitration in relation to resolving consumer disputes by upholding the decision earlier rendered by the National Consumer Disputes Redressal Commission (“NCDRC”)...
No Arbitration in Consumer and Real Estate Disputes
[Ajar Rab is a Partner at Rab & Rab Associates LLP, Dehradun] In an earlier post, I had discussed the decision of the National Consumer Disputes Redressal Commission (“NCDRC”) in Aftab Singh v. Emaar MGF Land Limited & Anr, which had held that consumers disputes are not arbitrable under section 2(3) of the Arbitration and Conciliation Act, 1996. The post had referred to the possibility of...
Board meetings by video-conferencing – whether available only if company allows, or whether director can insist on it?
The NCLAT has held recently (in Achintya Kumar Barua vs. Ranjit Barthkur ([2018] 91 taxmann.com 123 (NCL-AT)) that if any director desires to attend board meetings by video conferencing, the company is bound to allow attendance in this manner. In other words, it is not up to the company or at the discretion of the Chairman/Company Secretary whether or not to allow attendance by video conferencing...
Treatment of Extreme Results and Multiple-Year Data in Indian Transfer Pricing Law
[Ayush Chaturvedi and Chandni Bhatia are 4th Year B.A.LLB (Hons) students at Dr. Ram Manohar Lohiya National Law University, Lucknow] Introduction Arm’s length price is obtained by conducting a detailed “comparability analysis” as per the rules laid down in the Income-tax Act, 1961 (“Act”), the Income-tax Rules, 1962 (“Rules”) and the OECD Transfer Pricing Guidelines for Multinational Enterprises...
Why the FDI Policy’s Price Influence Restrictions on E-Commerce Marketplaces Have Failed
[Mark Papang and Sanchit Varma, 4th year students at NALSAR University of Law] Introduction The FDI Policy of India contains a number of provisions to ensure that the employment of foreign capital does not militate against healthy competition in the e-commerce sector. However in practice, many of these provisions have not had a significant impact on the manner in which e-commerce entities operate...
The Insolvency and Bankruptcy Code: Moratorium and Personal Guarantors
[Aayush Mitruka is a lawyer based in Delhi] The latest ruling of the National Company Law Appellate Tribunal (Appellate Tribunal) in the case of State Bank of India (SBI) v V Ramakrishnan and another has evoked another controversy touching upon the Insolvency and Bankruptcy Code, 2016 (Code) that serves as a major setback to creditors. The moot question was whether a financial creditor can...
Rationalisation of Competition Appeals: A Way Forward?
[Abhimanyu Singh Yadav and Anubha Singhal are 3rd year BA LLB (Hons) students at Dr. Ram Manohar Lohiya National Law University, Lucknow] The purpose of a Finance Act has generally been to lay down the tax proposals framed by the Central Government. However, apart from laying down tax proposals, the Finance Act 2017 brought about some noticeable structural changes in the functioning of appellate...
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