On 7 August 2024, the Supreme Court of India in The Blue Dreamz Advertising Pvt Ltd. & Ors. vs. Kolkata Municipal Corporation & Ors. delivered a significant judgment deciding upon the validity of a blacklisting order issued by the Kolkata Municipal Corporation. In this update, we discuss the ruling of the Supreme Court.

On 25 July 2024, the Supreme Court of India through an 8:1 majority, upheld the right of State Governments to impose taxes on mines and mineral-bearing lands. The Supreme Court also ruled that royalties payable on extracted minerals do not constitute a tax. In this article, we discuss the ruling of the Supreme Court.

In the case of Ambrish H. Soni v. Chetan Narendra Dhakan & Ors., the Bombay High Court ruled that it can grant interim relief under the Arbitration and Conciliation Act, 1996 (A&C Act) even after an Arbitral Tribunal is constituted, if necessary. This decision clarifies the court’s role in providing interim protection when arbitration proceedings […]

The Insolvency and Bankruptcy Code, 2016 (Code), and the Prevention of Money Laundering Act, 2002 (PMLA), are both crucial pieces of legislation designed to address distinct issues within India’s economic and legal landscape. While the Code aims to streamline insolvency processes and revitalize financially distressed companies, the PMLA focuses on combating money laundering and depriving […]

On 15 February 2024, the Insolvency and Bankruptcy Board of India (IBBI) notified the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Amendment) Regulations, 2024 (read here) to streamline the corporate insolvency resolution process (CIRP). A summary of the key amendments are as follows:  These amendments, effective from 15 February 2024, […]

One of the reasons why arbitration is a highly preferred mechanism for adjudicating commercial disputes is that it provides clarity to the parties with respect to the forum that will adjudicate over the disputes arising out of the agreement. However, in certain cases, a party to the arbitration may want to involve a non-signatory to […]

Introduction The financial implications for homebuyers in the context of the Insolvency and Bankruptcy Code, 2016 (Code) have been a subject of legal scrutiny. According to the Code, funds raised by a real estate company from a homebuyer or allottee are categorized as financial debt, granting them the status of financial creditors. This designation empowers […]

Introduction Since its introduction by way of an amendment in 2018, Section 12A of Commercial Courts Act, 2015 (Act) has garnered significant attention, specifically regarding the mandatory requirement for pre-institution mediation. Further a question arose as to whether suits instituted without recourse to mandatory pre-institution mediation ought to be rejected upon an application being filed […]

The Ministry of Corporate Affairs by notification dated 03 October 2023 (read here) exempted transactions, arrangements or agreements relating to aircraft, aircraft engines, airframes and helicopters under the Cape Town Convention and Protocol from the moratorium provisions of the Insolvency and Bankruptcy Code, 2016. This notification will allow the aircraft lessors to reclaim the possession […]

As per reports[i], India Market Capitalization accounted for USD 3,840.5 billion in September 2023 making it the world’s fourth largest market by value, surpassed only by the United States, China, and Japan. However, increased investor participation requires enhanced investor protection as well. In 2004, the Indian securities market regulator, SEBI, had issued comprehensive guidelines for […]

Indian Courts have consistently maintained the position that unilateral appointment of an arbitrator is legally untenable and bad in law. It was reasoned by the Courts that when one party unilaterally appoints an arbitrator, it creates an imbalance of power, leading to reasonable concerns about the arbitrator’s impartiality. As the independence and the impartiality of […]

After a merger, successor corporations may find themselves liable for the criminal actions of their predecessors. This means that they might have to defend themselves against criminal charges related to transactions they were not directly part of, and this could occur years after the transactions took place. When these criminal charges are brought forward, the […]

The Registration Act, 1908 (Registration Act) plays an important role when it comes to dealing with and managing information related to land and immovable property. Section 17(1) of the Registration Act provides for mandatory registration of certain documents. This mandatory registration safeguards the interests of all parties involved in property transactions. It establishes a foundation […]

The validity of arbitration proceedings may be called into question when procedural defects arise, and it may render the award susceptible to challenge. Procedural defects can occur at various stages of arbitration, such as the appointment of arbitrators, conduct of hearings, submission of evidence, or issuance of awards. When faced with procedural defects, parties involved […]

Introduction One of the key objectives of the Arbitration and Conciliation Act, 1996 (Arbitration Act) is expeditious disposal of commercial disputes. However, it is often seen that arbitration is marred by the time spent in courts at the pre-referral stage, especially during the appointment of the arbitral tribunal. In this background, the Supreme Court in […]

Introduction Securities and Exchange Board of India (SEBI), ensures transparency, fairness, and efficiency in the functioning of the Indian securities market. It regulates a diverse range of entities dealing with securities, including stock exchanges, brokers, depositories, and mutual funds; safeguards the interests of investors; promotes the development of the stock exchange, while also overseeing[i] the registration […]

Introduction A booming population, growing income and rapid urbanization has made India one of the fastest-growing major economies of this century. As per the World Bank[i], India’s GDP grew from USD 37 billion in 1960 to USD 3.18 trillion in 2021, registering an annual average growth over 5 per cent[ii]. India’s real estate sector has […]

Review and recall are two crucial legal mechanisms that safeguard the principles of fairness and justice within a judicial system. Review entails examination of the judgment to rectify any evident errors or inaccuracies which might be the result of an oversight. Conversely, recall empowers the court to rectify its previous orders if any procedural errors […]

Introduction In 2018, section 12A[i] was introduced in the Insolvency and Bankruptcy Code, 2016 (Code), to provide statutory recognition to settlement between the parties after the application to initiate the corporate insolvency resolution process (CIRP) has been admitted and allow withdrawal of the insolvency application. As of 31 March 2023,[ii], about 848 CIRPs have been […]

Introduction  Arbitration has evolved over the last few years as a preferred mode for resolving commercial disputes. In general, arbitral tribunals can adjudicate any civil or commercial dispute, provided that (a) the dispute is covered under the arbitration agreement, (b) referred to arbitration by the parties involved and (c) is capable of being resolved by […]

The Insolvency and Bankruptcy Code (Code) provides the right to a financial creditor to make an application to the National Company Law Tribunal (NCLT) for initiation of corporate insolvency resolution process (CIRP) against a corporate debtor in the event the debtor fails to repay its debt owed to the creditor. The Code as well as […]

Introduction Expeditious and efficacious dispute resolution is essential for creating a business-friendly environment. In its 246th Report, the Law Commission of India observed an emerging trend towards judicial intervention in arbitration. To tackle the same and make India a pro-arbitration jurisdiction, it was recommended to amend the Arbitration and Conciliation Act, 1996 (Arbitration Act). Keeping […]

“Reason is the soul of justice. Any order passed, whether in the exercise of judicial or administrative powers vested in the authority, must be speaking.” – said the Delhi High Court[i] while holding that giving of reasons for decision is an essential attribute of judicial and judicious disposal of a matter. Indian courts have repeatedly emphasized on […]

Introduction The Insolvency and Bankruptcy Code, 2016 (Code) provides for initiation of corporate insolvency resolution process (CIRP) against a corporate debtor in case of debt and default of such debt. However, there may be a situation, especially in companies engaged in development and construction of real estate projects when the resolution of debt or development […]

Introduction The Insolvency and Bankruptcy Code, 2016 (Code), in its original form, did not include provisions with respect to withdrawal of an application for the initiation of corporate insolvency resolution process (CIRP). However, pursuant to various judicial pronouncements[i], Section 12A was inserted[ii] in the Code permitting withdrawal of CIRP with the approval of 90% voting […]

Introduction The objective of the Insolvency and Bankruptcy Code, 2016 (Code) is to maximize the value of the assets of the corporate debtors and to ensure their revival. One vital aspect for reviving a debt-ridden company is reversal of avoidance transactions i.e., preferential, undervalued, defrauding creditors and extortionate transactions. The Code empowers the resolution professional […]

An arbitration agreement is an agreement between the contracting parties through which disputes that might crop up between the parties are to be resolved by arbitration. It is not only a common but also a very crucial feature of commercial contracts of our times. Under the Arbitration and Conciliation Act, 1996 (Act), certain attributes[i] must […]

Introduction The provisions regarding ‘oppression and mismanagement’[i] in companies under the Companies Act, 2013 (Companies Act) are an integral part of the corporate governance structure in India. Where the affairs of the company are being conducted in a manner where the rights of some shareholders are being adversely affected or there is serious or continuous […]

Introduction The Insolvency and Bankruptcy Code, 2016 (Code) contains four types of avoidable transactions that are to be avoided, otherwise it would affect the financial position of the corporate debtor – preferential, undervalued, defrauding creditors and extortionate transactions. The Code mandates that the Resolution Professional / the Liquidator (Insolvency Professional) should determine if the corporate debtor […]

In arbitration, the ‘seat’ mentioned in the arbitration agreement determines the court that would exercise supervisory jurisdiction over the arbitral proceedings. As parties may be required to approach a court for appointment of arbitrator or for seeking interim relief or for taking directions to seek evidence, etc., the ‘seat’ is an important facet of the […]

Introduction In India, prior to the Insolvency and Bankruptcy Code, 2016 (Code), insolvency proceedings against individuals used to be governed by the Presidency Towns Insolvency Act, 1909 and the Provincial Insolvency Act, 1920. While, the Presidency Towns Insolvency Act, 1909 was applicable to the erstwhile presidency towns such as Calcutta, Bombay and Madras, the Provincial […]

The Insolvency and Bankruptcy Code, 2016 (Code) was introduced as a one stop solution for resolving insolvencies, which previously was a long-drawn process that did not offer an economically viable arrangement. In Swiss Ribbons Pvt. Ltd. v. Union of India, the Supreme Court of India, while upholding the constitutional legitimacy of the Code, emphasized that […]

Introduction The primary object of the Insolvency and Bankruptcy Code, 2016 (Code) is the revival of the corporate debtor undergoing insolvency process and to keep it running as a going concern. To achieve this objective, the Code prescribes the imposition of a moratorium upon initiation of corporate insolvency resolution process and casts a duty on […]

The adjudication of claims arising out of private civil or commercial arrangements between parties is ordinarily capable of being referred to arbitration. The underlying principle of arbitration remains that private arrangements between parties give rise to a right in personam (against a particular person), which is exercisable only between the parties to such an arrangement and […]

Introduction Section 12A of the Commercial Courts Act, 2015 (Act) mandates pre-institution mediation in case of a commercial suit above a specified value, unless the suit contemplates urgent interim reliefs. The Supreme Court of India in M/s. Patil Automation Private Ltd. v. Rakheja Engineers Private Ltd.1 (Patil Automation Case) held that pre-institution mediation is mandatory and any […]

Introduction The Micro, Small, and Medium Enterprises Development Act, 2006 (MSMED Act) was enacted to ensure timely and smooth flow of credit to small and medium enterprises while promoting, developing and enhancing the competitiveness of micro, small and medium enterprises. This came at a time when the Arbitration and Conciliation Act, 1996 (Arbitration Act) had […]

In India, procedural law relating to civil and commercial disputes is governed by the Code of Civil Procedure, 1908 (CPC). The CPC lays down the procedure for administration of civil proceedings including rules for filing of suits, written statements, filing of documents, evidence, permissible reliefs, and enforcement.   While CPC is applicable to every commercial dispute […]

The Insolvency & Bankruptcy Code, 2016 (Code) provides a structure for realisation of debts owed to the creditors in the event of liquidation. In this structure, secured creditors are given preference to recover their dues over statutory dues / crown debts owed to the State. However, recently in State Tax Officer v. Rainbow Papers Ltd. […]

Under the Insolvency and Bankruptcy Code, 2016 (Code), the resolution professional or the interim resolution professional (collectively referred as RP) is vested with the responsibility of running the business of the corporate debtor as a going concern and conducting the corporate insolvency resolution process (CIRP). The RP must also ensure that CIRP is conducted in […]

Specific performance of a contract refers to a remedy wherein the court compels the defaulting party to perform its obligations under the contract. This remedy has emerged as a form of equitable relief and does not require an express contractual provision. The Specific Relief Act, 1963 (Act) is the governing statute for specific performance as it […]

In 2005, the Government of India had constituted an expert committee headed by Dr. J.J. Irani to advise on revising and modernizing the Companies Act, 1956. The committee in its report (JJ Irani Report)[i] gave its views on various issues including on appointment, duties and obligations of the Key Managerial Personnel (KMP). Pursuant to the recommendations […]

An arbitral tribunal is a creation of a contract between parties. The tribunal is brought to life when the parties decide to refer their inter-se disputes to the tribunal and once the final award is passed, the tribunal’s mandate comes to an end. However, under the Arbitration and Conciliation Act, 1996 (Act), termination of the […]

Under the Insolvency and Bankruptcy Code, 2016 (Code), if a corporate debtor is unable to pay its debts, then insolvency resolution proceedings (CIRP) may be initiated against the corporate debtor and attempts are made to revive the corporate debtor by inviting resolution plans. If the revival process fails, the corporate debtor must be liquidated. The […]

The parties to arbitration have limited remedies under the appeal provision against the orders of the arbitral tribunal. While the Arbitration and Conciliation Act, 1996 (Act) contemplates appeal from interim orders of the arbitral tribunal to courts, such orders cannot be reviewed or recalled by the arbitral tribunal itself. This brings one to the question […]

Under corporate law, it is a well settled principle that a company has a juristic existence which is independent of its shareholders. An exception to this principle is the doctrine of lifting of corporate veil i.e., looking past the separate identity of the company and affixing liability on the actual perpetrators i.e., the management of […]

A key concern in respect of the Insolvency and Bankruptcy Code, 2016 (Code) since its inception has been the differential treatment of operational creditors and financial creditors. For context, financial creditors have a purely financial arrangement with the corporate debtor, while operational creditors are those who are owed money by the corporate debtor for the […]

The Insolvency and Bankruptcy Code (Code) provides the right to a financial creditor to make an application to the National Company Law Tribunal (NCLT) for initiation of corporate insolvency resolution process (CIRP) against a corporate debtor in the event the debtor fails to repay its debt owed to the creditor. The Code as well as […]

Introduction One of the cardinal rules of natural justice is that no one should act as a judge in a case where they have a personal interest. This is because a judge may harbor some bias (or perceived to have some bias) which may ultimately affect an otherwise equitable outcome in cases where the judge […]

The Insolvency and Bankruptcy Code, 2016 (Code) was enacted to consolidate and amend the laws relating to reorganization and insolvency resolution of corporate persons. However, the overlap of the Code with the erstwhile laws relating to insolvency and recovery of debts, such as the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest […]

Introduction The Insolvency and Bankruptcy Code, 2016 (“Code”) was enacted with a primary objective of timebound reorganisation and insolvency resolution of corporate debtors. Under the Code, financial or operational creditors of a corporate debtor can approach the National Company Law Tribunal (“NCLT”) to initiate insolvency resolution process against a corporate debtor upon occurrence of a default […]

Introduction The Insolvency and Bankruptcy Code, 2016 (“Code”) was introduced in the year 2016 and since its introduction it has gone through a spate of amendments. Pursuant to the Insolvency and Bankruptcy Code (Second Amendment) Act, 2018 (“2018 Amendment Act”), allottees of real estate projects (“Homebuyers”) have been included within the ambit of “financial creditors” […]

Recent conflicting judgments of the National Company Law Tribunal (NCLT) and the High Courts had given rise to ambiguity regarding the jurisdiction of NCLT vis-à-vis personal guarantors under the Insolvency and Bankruptcy Code, 2016 (Code). The issue of the correct forum for insolvency proceedings of a personal guarantor arises where an application seeking insolvency or […]

The problem of Non-performing Assets (NPAs) in the Indian banking system is one of its foremost predicaments. In order to allow lending institutions to recover such NPAs in an expeditious manner, the Indian Government established Debt Recovery Tribunals (DRT) under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (RDDBFI Act), and […]

The Insolvency and Bankruptcy Code, 2016 (Code) has played a significant role in rescuing financially distressed companies as compared to the former insolvency law regimes which were provided in various statues having different objectives and processes. The initial success of the Code is attributable to various factors including the manner in which the Indian judiciary […]

Supreme clarifies legal dilemma on right of Indian parties to choose a foreign seat of arbitration On 20 April 2021, the Supreme Court vide its judgment in PASL Wind Solutions Private Limited v. GE Power Conversion India Private Limited finally laid to rest the quandary on whether two Indian parties can adopt a foreign seat of arbitration. The three-judge bench of the Supreme Court held that nothing […]

In the winter of 2015, the Indian Legislature sought to tackle the persistent problem of bad debts affecting Indian financial institutions and trade creditors by enacting the Insolvency and Bankruptcy Code, 2016 (“Code”), which was finally notified in May 2016. The key purpose of the enactment was to consolidate and amend the laws relating to reorganization and […]

We are pleased to announce that Acuity Law acted as the legal advisor to NABVENTURES Limited and NABVENTURES FUND I (together referred to as NABVENTURES) in its investment in Vilcart Solutions Pvt. Ltd (Vilcart).    NABVENTURES Fund I is managed by NABVENTURES Limited, a wholly owned subsidiary of the National Bank for Agriculture and Rural Development (NABARD). Vilcart is a start-up company which is re-defining the rural unorganised retail industry with the use of technology.  […]