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BY THE PEOPLE. FOR THE PEOPLE. OF THE PEOPLE.www.legaleraonline.com | January 2019 | Vol. IX | Issue IX | Pages 84

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Legal Era Magazine in conversation with Amarjit Singh Chandhiok, President, INSOL India

PrOvEN MErIt ShOuLd BE thE CONSIdErAtION, EquALLy APPLICABLE FOr

thE BENCh ANd thE BAr

Singapore’s New Accredited

Investor Regime

Criminal Prosecution Under Income

Tax Act

Cross-Border M&A: Critical

Aspects

Is The Ban OnENDS Healthy?

3 www.legaleraonline.com | Legal Era | January 2019

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Editor's Pick

Crypto:What Next

Those in the know say that despite the slow market recovery currently, a second wave of bitcoin and cryptocurrencies is imminent, increasingly driven by

individuals, enterprises, and jurisdictions across the world.

Reason being that the sentiment around cryptocurrencies continues to be positive, no matter the market conditions. After all, cryptocurrency, by its very nature, is money that is safe from political influence, in addition to bearing the promise of increasing in value over time. No wonder, people are continuing to buy cryptocurrencies to shield themselves against the devaluation of their national currencies. Institutional investors, too, are beginning to buy these currencies, even as banks and governments realize their power in wrestling control from them. Further, custodial services are beginning to offer new crypto assets for storage; crypto exchanges are adding new trade pairs; and several jurisdictions are opening up to the idea of including cryptocurrencies as significant components of their financial systems.

Speaking of jurisdictions, Asia, save for a few countries like China that have come down hard on cryptocurrencies, has been a big driver of cryptocurrency interest and mining power. By contrast, most major economies in the West have focused on warning investors about the risks associated with trading in cryptocurrencies rather than introduce new laws around them.

Meanwhile, smaller territories and nations have been moving in for the kill, trying to establish themselves as the new crypto hubs of the world. So, you have a Gibraltar trying to become one of the most important places for startups in blockchain and cryptocurrencies, or a Bermuda moving forward with its own laws in crypto. Each country may have a different approach towards this new phenomenon, but one thing is clear: it is here to stay. So much so that many believe that 2019 may see new legislation bringing cryptocurrencies and blockchain into the regulatory fold.

Shri D.V. Sadananda GowdaHonorable Minister of

Chemicals & Fertilizers, Statistics and Programme

ImplementationGovernment of India

Shri. Rajiv AggarwalJoint Secretary,

Department of Industrial Policy & Promotion

Government of India, New Delhi

Pravin Anand

Shri. O P Gupta, IAS

Managing Partner Anand and Anand

Controller General of Patents, Designs & Trade Marks

Intellectual Property IndiaMumbai, India

Justice B. N. Srikrishna

Rajesh Sagar

Dr. Anindya Sircar

Former JudgeSupreme Court of

India

Managing Associate Solicitor (UK)

Marks & Clerk Solicitors LLP

IP Consultant

Matthew L. FedowitzShareholder –

Intellectual PropertyBuchanan Ingersoll &

Rooney PC

Arshad Jamil

Dr. K.S. Kardam

Associate Vice President - IPR

Biocon Ltd.

Sr. Joint Controller of Patents & Designs

Intellectual Property India, New

Delhi, India

Ganapathy Narayanan

Douglas Graham

Lead - Corporate IP Governance Tata Consultancy Services Ltd.

Prof. Dr. Heinz GoddarEuropean and German Patent and Trademark

Attorney BOEHMERT & BOEHMERT

CEO Ideation Inc.

Prof. (Dr) Prabuddha Ganguli

CEO, VISION-IPR; Visiting Professor Rajiv Gandhi School of Intellectual

Property Law, IIT

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EminEnt SpEakErS kEy DiScuSSion arEaS• What Role Can India Play In Making

The Global IP Ecosystem Fairer, Less Complex, And More Useful For People?

• Biosimilar Litigation For The Hatch-Waxman Litigator

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• Whose Song Is It Anyway? Copy - My Rights

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• Pharmaceutical Wars: Who’s The Bigger/Better Innovator!

• FRAND & SEP: Unseen Ironies Under IP And Competition Law

• How Will AI, Machine Learning, And Analytics Impact Patenting? [The Kinds Of Patents People Seek? Prior Art Search? The Patent Application And Grant Process? Patent Licensing? Value Extraction?]

• How Will Industrial IOT Impact IPR And Vice Versa?

• Hurdles In The Effective Enforcement

• How Will The IP Ecosystem Cope With Networked And Intelligent "Things"? Who Is The Creator Of Those "Things"? Who Owns What The "Things" Create?

• What IP Allocation And Cross-Licensing Challenges Will Open Innovation Present? What Options Can We Formulate For The Greater Collaborative Creation Of IP?

• Review On IP Policy - Where Is India Heading?

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January 2019Contents36 Zoom In

Let's Uphold52

03 Editor's Pick

10 Readers’ Notes

12 Feature

14 Top Stories

18 Nation @ Glance

22 World @ Glance

26 Notifications

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68 Highlights

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Cross-Border M&A: Critical Aspects

Cross-border mergers and acquisitions have emerged as a way to rapid expansion and global

trends point to increasing deal volume

Deconstructing The Binani Cements/Rajputana NClAT Judgment:

Discrimination Between Creditors, And Maximization Of Value

While the substance over process approach taken by the NCLAT in relation to UltraTech’s bid may be beneficial from a straight-

jacketed procedural approach in a CIRP, the conclusion in relation to no discrimination between sets of financial creditors and

operational creditors may be problematic

Since 8 October 2018, many within the financial services industry have been struggling to understand the finer aspects of the new regime, recalibrate their client

on-boarding policies and procedures to account for the new requirements, and hopefully have the entire effort completed on or before 8 January 2019

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56 Viewpoint

Is it fair for the Government, as a stakeholder in India’s largest cigarette company, to advise banning a product without even considering the views prevailing

in other jurisdictions and the reasons why they have regulated and allowed sale of ENDS?

Is The Ban onendS Healthy?

The Code has to maintain balance among the objectives by consistently ensuring maximization of value, promotion of entrepreneurship, availability of credit and balancing the

stakeholders’ interests within a transparent and time-bound manner

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REadERs' notes By the people for the people

Feature


P&A LAw Offices secures victOry fOr DAiichi sAnkyO in

the singAPOre high cOurt

fraudulently misrepresented to Daiichi about the SAR, its genesis and severity, and its possession by the US authorities.

Considering the facts of the present case, Justice Ang dismissed the application to set aside the award against the Singh brothers and family, except the minors (“Sellers”).

On January 31, 2018, Justice Jayant Nath of the Delhi High Court had issued the decision in favor of Daiichi Sankyo, dismissing objections under Section 48 of the Arbitration and Conciliation Act, 1996 (“DHC Judgment”).

A bench of Justices Ranjan Gogoi and R Banumathi of the Supreme Court of India had upheld the decision of the High Court of Delhi by dismissing the Special Leave Petitions in limine on February 16, 2018. Thus, the Award became final and binding in India. The setting-aside proceedings under Section 24 of the International Arbitration Act, commenced on April 9, 2018 and continued for four days until April 13, 2018 in the High Court of Singapore.

Senior Advocates Gopal Subramanium and Harish Salve had been granted leave by the High Court of Singapore to appear and argue on certain aspects of Indian Law which were essential for the adjudication of the case. This was the first time that two senior counsel from India had been granted leave to appear and argue in the High Court of Singapore.

In yet another victory for Daiichi Sankyo Company Limited (a global pharmaceutical company and the second largest in Japan), represented by P&A Law Offices, against the Singh brothers, on December 21, Justice Belinda Ang of the Singapore High

Court upheld the Singapore-seated ICC Arbitral Award of INR 4000 crores ($750 Million) in favor of Daiichi Sankyo.

The case dates back to 2008, when Malvinder Singh and family, including his brother Shivinder Singh, had sold their entire stake of about 35 percent in Ranbaxy Laboratories Limited for $2.4 billion to Daiichi Sankyo. However, in 2013, Daiichi Sankyo had filed an arbitration case in Singapore accusing the Singh brothers of concealment and misrepresentation of facts after Ranbaxy paid $500 million to the US Department of Justice as settlement for misrepresenting facts.

Thereafter, in April 2016, a Singapore Arbitral Tribunal had asked the Singh brothers (Malvinder & Shivinder Singh) and their family, the erstwhile promoters of Ranbaxy Laboratories Limited, to pay damages of INR 2,500 crores to Daiichi Sankyo for concealing and misrepresenting information during Ranbaxy stake sell. The Tribunal had then concluded that Malvinder and his associates were aware of an incriminating internal document called the Self-Assessment Report that chronicled the fabricated regulatory filings in over 40 countries in relation to over 200 products made by Ranbaxy; yet, they misled, actively concealed, and

Feature


were made jointly and severally liable despite the size of their shareholding smacks of an error made by the Majority that this court cannot review, rather than a public policy objection. The scope of setting aside or refusal of recognition/enforcement on the ground of public policy is very narrow, and courts have to be cautious of a back-door appeal on the merits through this ground.”

Justice Ang allowed the Award to be set aside as regard the minors while upholding Award which imposed joint and several liabilities on the Sellers for fraud and active concealment. Daiichi Sankyo is presently in the midst of execution of the Award in the High Court of Delhi.

In a nutshell, this decision has paved the way for Daiichi Sankyo to continue execution proceedings against Malvinder Singh and his associates for recovery of the Award amount. As on date, the Award amount stands at approximately INR 4000 crores, including interest.

The Buyer/Plaintiff, Daiichi Sankyo, was represented by Senior Advocate Gopal Subramanium briefed by Pavan Bhushan and Jayavardhan Singh from GS Chambers, P&A Law Offices; Anand S Pathak, Amit Kumar Mishra, Abhijeet Sinha, and Samridhi Hota along with Singapore-based law firm, Oon & Bazul LLP.

The Sellers/Defendants, Malvinder Singh and others, were represented by Senior Advocate Harish Salve, Alvin Yeo, SC briefed by WongP LLP. The Minors were represented by Lee EngBeng, SC briefed by Rajah and Tann LLP and DMD Advocates.

Justice Ang placed extensive reliance on the observations made by Justice Nath in the DHC Judgment:

“..The present case concerns a de novo review of the award in the face of jurisdictional challenges to the powers of the Tribunal. Given the essence of the challenges, I am of the view that issue estoppel should not feature. Nevertheless, the decision of the Indian enforcement court may have persuasive effect, especially because the proper law of the Arbitration Agreement is Indian law…”

On the issue of fraud, Justice Ang observed that the High Court of Singapore was precluded from reviewing the finding of fact by the Award:

“..The decision of the Majority in holding the Non-Management Sellers liable on the ground that the fraudulent misrepresentations made were within the apparent authority of their agents is in line with the position under Singapore law, and cannot be contrary to the public policy of Singapore. What the Non-Management Sellers are seeking to accomplish in fact is to reopen the Majority’s finding that the fraudulent misrepresentations made by BBA and the other agents were within their apparent authority. The court is precluded from reviewing the finding of fact by the Majority…”

Justice Ang reiterated the scope of setting aside or refusal of recognition/enforcement on the ground of public policy of Singapore in the following manner:

“..Ultimately, the fact that the Non-Management Sellers

Managing Partner, P&A Law OfficesSenior Advocate

Anand S PathakGopal Subramanium

Top STorieS


Adv. MAdhAvi divAn Appointed ASG, third woMAn to hold the poSt in SCMonday, December 17, 2018

On December 17, the Centre appointed Supreme Court Advocate Madhavi Divan to serve as the Additional Solicitor General (ASG) in the court till June 30, 2020, thus making her the third woman to hold this post in the apex court. In this role, Madhavi will represent the government in the Supreme Court. Senior Advocate Indira Jaising was the first woman to be appointed as the ASG, while Senior Advocate Pinky Anand, who still holds the post, was the second woman.Madhavi has practised before the Supreme Court, appearing in several landmark constitution cases. She argued before the Constitution Bench in Sahara India vs. SEBI where the Court framed guidelines for the media in respect of coverage of court proceedings. Earlier, on several occasions, she addressed the Constitution Bench on facets of privacy in the case concerning WhatsApp. Apart from these cases are several matters where key submissions were prepared and assistance rendered by Madhavi to the Attorney General and the Court in matters of great constitutional

significance. The Fourth Judges’ case challenging the NJAC Constitutional amendment and the Dr. Subramanian Swamy matter that upheld the IPC provisions on criminal defamation count amongst landmark decisions that have shaped the contours of power, politics and society. She has appeared in cases where the boundaries of free speech are being explored – on intermediary liability, hate speech, pornography, film certification, commercial speech and internet safety as in the Blue Whale case. She played a pivotal role in the Shayara Bano case where she was entrusted with the task of firming up the stand on behalf of the Union of India.The landmark verdict delivered will help unshackle women long oppressed by the age-old practice of triple talaq. Alongside her interest in constitutional law, Madhavi continues to pursue her commercial practice in the Supreme Court, high courts, and tribunals. In law colleges across the country, Madhavi is known amongst students, professors, and journalists through her authoritative work, Facets of Media Law, now in its second edition. Madhavi was on the editorial board of the magnificent book – ‘Courts of India: Past to Present’, published by the Supreme Court of India, and was the primary author of the chapter on landmark trials. She is Editor-in-Chief of The Indian Advocate, the journal of the Bar Association of India, once edited by Mr. C. K. Daphtary. She is on the Academic Council of the Maharashtra National Law University and on the governing board of several other educational institutions.

Read more: http://http://www.legaleraonline.com/news/baba-ramdev-vs-juggernaut-books-sc-issues-notice-to-ramdev-on-juggernauts-plea-challenging-delhi-hcs-verdict

BABA rAMdev vS. JuGGernAut BookS: SC iSSueS notiCe to rAMdev on JuGGernAut’S pleA ChAllenGinG delhi hC’S verdiCtFriday, November 30, 2018

In the ongoing tussle between Yoga guru Baba Ramdev and Juggernaut Books Private Limited, the publisher of the book “Godman To Tycoon: The Untold Story of Baba Ramdev”, the Supreme Court on November 30 issued notice to Ramdev on a plea by the publisher challenging the Delhi High Court’s verdict restraining the sale and publication of a book purportedly on Ramdev’s life.

The court said, “We will issue notice to Respondent 1 (Ramdev)”.

Senior Advocate Kapil Sibal, representing the publisher, informed the SC that there were “some significant” and “very interesting issues” in the matter.

Thereafter, the court asked the publisher, “Why do you [the publisher] want Amazon India and Flipkart Internet Private Limited (as parties) unnecessarily in this?”

In September 2018, the publication and sale of a book supposedly based on the life of Yoga guru Baba Ramdev was restrained by the Delhi High Court following Ramdev’s petition that it contains defamatory content.

Top STorieS


SC direCtS kerAlA, BihAr to ConStitute SpeCiAl CourtS to Speedup triAlS AGAinSt Mps, MlAsTuesday, December 4, 2018

On December 4, in a move aimed to speedup trials in pending criminal cases against former and current Members of Parliament (MPs) and state assemblies – MLAs, a Supreme Court bench comprising Chief Justice Ranjan Gogoi and Justices Sanjay Krishan Kaul and KM Joseph directed the governments of Kerala and Bihar to constitute special courts in this regard which would decide on life-term cases on a priority basis while hearing pending matters against MPs and MLAs. Notably, the Top Court provided the liberty of constituting as many courts as required in these two states for trial of cases against legislators. The SC also asked all high courts to allocate pending cases against accused lawmakers “among as many sessions courts as possible” to ensure that trials are concluded faster.

Moreover, the bench asked the existing special courts in these two states to submit detailed reports on the status of pending cases against legislators and then directed them to submit the status report to the Apex Court by December 14. The Apex Court also directed the sessions courts to try criminal cases pending against former and present MPs

and MLAs on priority. This decision by the SC arose after it referred to a report submitted by the amicus curiae, based on the information submitted by the high courts, which mentioned that 4122 cases are pending against the sitting and former MPs and MLAs, of which 440 cases involving life sentence are pending against lawmakers and the remaining 2324 cases are against MPs. The report suggests the need to set up one designated sessions court and one magistrate court in each district in order to ensure effective trials.

Read more: http://www.legaleraonline.com/news/sc-directs-all-high-courts-to-send-original-records-and-their-english-translations

SC direCtS All hiGh CourtS to Send oriGinAl reCordS And their enGliSh trAnSlAtionSWednesday, December 12, 2018

The Supreme Court on December 12 issued a Circular stating that in all criminal appeals wherever translation is required to be done into English, the same shall be done at the Registry of the respective High Courts before sending the original record to the Apex Court.

The SC Circular read, “Order XIX Rule 8(ii) of the Supreme Court Rules, 2013, read with sub-rule (1) of Rule 11, inter alia, mandates that the Registrar of the Court appealed from shall transmit the original record of the case, upon being requisitioned, in English language and in case the record or any part thereof is in a language other than English, the Court appealed from shall have it translated before transmitting the same to this Hon’ble Court. The provisions of Order XIX are applicable mutatis mutandis to other Orders of the Supreme Court Rules, 2013.”

The SC considered two cases in this regard:1. The Supreme Court, in the case of Pehtu Kanwar & Ors versus State of Bihar (Now Jharkhand) [Criminal Appeal No. 1257 of 2007], on April 27, 2010, has been pleased to direct as under:

“It is not understood as to why the High Courts while sending the original records do not send the deposition after proper translation. It is, therefore, ordered that in future in all criminal appeals wherever translation is required to be done into English, the same shall be done at the Registry of the respective High Courts before sending the original record to this Court.”

The SC said, “Circular F.No.70/Judl./2010 dated November 18, 2010 was issued, which directed that as and when original record is received from any High Court, it must be ensured that either the deposition is in English or it is translated into English. In case the depositions have not been translated into English, such record shall be sent back to the concerned High Court with the request to send the record after proper translation of the deposition in view of the directions contained in the case of Pehtu Kanwar (supra).”

Top STorieS


SC JuStiCe Ak Sikri noMinAted ChAirMAn of SupreMe Court leGAl ServiCeS CoMMitteeMonday, December 3, 2018

Constitutional cases, and Labour – Service matters. He was Counsel for numerous Public Sector Undertakings, Banks & Financial Institutions, Educational Institutions, and Private Sector Corporations.

Justice Sikri was also a part-time lecturer in Campus Law Centre, Delhi University (1984-89); Vice-President, Delhi High Court Bar Association in 1994-95; Member of the Governing Body of various colleges from time to time; Designated as Senior Advocate by the Delhi High Court on September 30, 1997; and Appointed as Judge of the Delhi High Court on July 7, 1999. As a Judge, Justice Sikri has dealt with all kinds of jurisdictions. He has sat on the Commercial Bench, IPR Bench, and Insolvency Bench for a number of years and gave many landmark judgments.

Justice Sikri was chosen as one of the 50 most influential persons in Intellectual Property in the world by a leading prestigious international organization for the year 2007 in recognition to his contribution to the growth of Intellectual Property Laws through his judgments.

As per a Notification issued by the National Legal Services Authority, Department of Justice, Ministry of Law and Justice, in exercise of the powers conferred by Section 3A of the Legal Services Authorities Act, 1987 (39 of 1987) read with Rule 10 of the National Legal Services Authority Rules, 1995, the Central Authority nominated Justice Arjan Kumar Sikri, Judge, Supreme Court of India, as Chairman of the Supreme Court Legal Services Committee with effect from November 30, 2018. Justice A K Sikri is a Judge of the Supreme Court of India. He has an excellent academic record. He has conducted cases of all types with specialization in Arbitration and Commercial matters,

SC ApproveS drAft witneSS proteCtion SCheMe frAMed By Centre in ConSultAtion with nAlSAWednesday, December 5, 2018

On December 5, the Supreme Court of India approved the draft witness protection scheme framed by the Centre in consultation with the National Legal Services Authority (NALSA) and asked all states and union territories to implement it until Parliament passes a legislation. The Apex Court stated that until Parliament passes a legislation, this scheme would be the law of the land. An SC bench headed by Justice A K Sikri and comprising Justice S. Abdul Nazeer informed that they have made certain changes in the scheme.

Earlier, on November 19, considering the issue of the witness protection scheme, the Supreme Court had stated that it will direct all states to implement the scheme.

Responding to the court, Attorney General K K Venugopal had then said that the draft scheme, which has now been finalized, would be made into law “in due course”, but till then, the court should direct the states to start implementing it.

In response, the court had said, “We will pass an order. We will give directions to all the states to start implementing it (scheme).” Thereafter, assisting the court as amicus curiae, Advocate Gaurav Agrawal had said, “Based on the

inputs received from majority of the states, a draft witness protection scheme is finalized in consultation with NALSA.” Agrawal had added that there are three categories of witnesses in this scheme based on threat perception and that the states should start enforcing it. The decision to formulate the draft witness protection scheme stems from a case wherein the Supreme Court was hearing a PIL seeking protection for witnesses in rape cases involving self-styled religious leader (Godman) Asaram Bapu.

Read more: http://www.legaleraonline.com/news/sc-approves-draft-witness-protection-scheme-framed-by-centre-in-consultation-with-nalsa

Read more: http://www.legaleraonline.com/news/sc-justice-ak-sikri-nominated-chairman-of-supreme-court-legal-services-committee

Top STorieS


“proSeCute the loCAl AGenCieS. Send theM to JAil. thAt iS the only option left.”: SupreMe CourtMonday, November 26, 2018

Amid severe concerns of air pollution rising alarmingly high in India’s national capital, with the Air Quality Index (AQI) registering ‘Hazardous’ levels throughout the region, the Supreme Court on November 26 pulled up Delhi’s municipalities for failure to address complaints registered by people regarding pollution, stating that erring officials who are supposed to take action against polluters but failed to do so should be brought to book for conniving with the main culprit and that such officials as well as government agencies should be prosecuted under Section 15 of the Environment Protection Act.

Notably, the suggestion to punish officials was given to the Court by the Central Pollution Control Board (CPCB), which had stated that officials and nodal agencies should also be penalized in case of failure to act for controlling air pollution incidents.

A counsel representing the Centre then informed the court that while some complaints in this regard were addressed, others are in the clutches of local agencies and that the citizens had registered 3337 complaints through the ‘Sameer’ App (launched by the CPCB) and 749 complaints through social media.

Representing CPCB, Additional Solicitor General A N S Nadkarni informed the court that CPCB had already issued show cause notice to some of the nodal agencies to initiate criminal prosecution against them, and he therefore

The Supreme Court recently issued a Notice with regard to the Allotment of Lawyers’ Chambers Rules (As amended up to November 20, 2018).The Notice states the following:1. These Rules shall be called Lawyers’ Chambers

(Allotment and Occupancy) Rules.2. Allotment of Chambers shall be made by a Committee

appointed by the Chief Justice of India and all such allotments shall be subject to the approval of the Chief Justice of India.

3. Allotment shall be made to such advocates of the Supreme Court as are members of the Supreme Court Bar Association who regularly practice in the Supreme Court and who reside in Delhi or New Delhi and the areas nearby, namely, Noida, Greater Noida or Ghaziabad in Uttar Pradesh, Faridabad or Gurugram in Haryana.

4. Allotment of Chambers to applicants, who are members

pleaded the court to pass an order empowering CPCB to initiate such proceedings against these officials and agencies.

Thereafter, Advocate Aparajita Singh, who is assisting the court as amicus curiae in the matter, stated that the agency failed to take action to control pollution as there was no provision to take action against them. Aparajita also highlighted that erring officials and agencies should be brought within the ambit of the penal provision of Section 15 in order to ensure that they discharge their duties as per law.

Allowing the Board to initiate prosecution, the court concluded, “Prosecute the local agencies. Send them to jail. That is the only option left.”

SupreMe Court iSSueS notiCe on lAwyerS’ ChAMBerS (AllotMent And oCCupAnCy) ruleSWednesday, December 5, 2018

Read more: http://www.legaleraonline.com/news/supreme-court-issues-notice-on-lawyers-chambers-allotment-and-occupancy-rules

of the Supreme Court Bar Association, shall be made in the following order:(i) Advocates-on-Record who are regularly practising

in this Court(ii) Non Advocates-on-Record resident in Delhi/New

Delhi and the areas nearby, namely, Noida, Greater Noida or Ghaziabad in Uttar Pradesh, Faridabad or Gurugram in Haryana, and who are mainly and regularly practising in this Court; and

(iii) Senior Advocates resident in Delhi/New Delhi and the areas nearby, namely, Noida, Greater Noida or Ghaziabad in Uttar Pradesh, Faridabad or Gurugram in Haryana, and who are mainly and regularly practisng in this Court.

NatioN @ GlaNce


HigH Court & tribunal news around tHe nation

Bombay High CourtBomBay HC first to get solar power plantTuesday, December 4, 2018

Outlining his plans of utilizing solar energy for the entire HC building as well as bungalows of the judges, CM Fadnavis said, “About a decade back, any talk of green energy was considered to be elitist as there was hardly any concern for the environment. However, we are experiencing the vagaries of nature for the last many years due to climatic changes and global warming. As a result, Maharashtra is facing drought for the last four years in a row due to erratic rainfall.” Guardian Minister Bawankule informed that the CM had cleared `2 crore for utilizing solar energy for the entire HC building as well as the bungalows of the judges by setting up a 100kW solar power plant and added that the district and sessions court also would soon be turned into utilizing solar energy.Thereafter, CJ Patil said, “This is the first project to be executed with active participation from the state and the judiciary. With the help of District Mineral Council, Justices Bhushan Gavai and Bhushan Dharmadhikari had shown interest and laid its foundation stone.” Subsequently, Justice Deshpande also commended the initiative stating that it had given a facelift to the HC building under the guidance of HCBA President Kilor. Noting that the project completion deadline was six months, Justice Deshpande praised highly the team for completing it in just 40 days.

On December 3, Chief Minister Devendra Fadnavis, in the presence of Chief Justice (CJ) of Bombay High Court Naresh Patil, Administrative Judge Ravi Deshpande, Guardian Minister Chandrashekhar Bawankule, High Court Bar Association (HCBA) President Anil Kilor, and Secretary Prafull Khubalkar, commissioned a solar power plant of 200 kW at the Nagpur bench of the Court.The event was organized in the main portion of the HC building which was illuminated with a new lighting system powered by the solar plant and was well-attended by many eminent personalities, including former and current judges, senior lawyers, and law students. The initiative, which sets a precedent for government and semi-government institutions, will save power expenditure by about `40 lakh per year, in addition to effectively reducing the growing issue of pollution to a significant extent.

Read more: http://www.legaleraonline.com/news/bombay-hc-pulls-up-maharashtra-government-for-issuing-job-recruitment-advertisement-under-maratha-quota

Days after the Devendra Fadnavis-led Maharashtra government officially gave the Marathas 16% reservation in government jobs and education, the Bombay High Court on December 10 pulled up the state government for issuing a job recruitment advertisement under the Maratha Quota considering the fact that petitions challenging the same are still pending before the court.The Maharashtra Public Service Commission’s (MPSC’s) job recruitment advertisement under the Maratha Quota was highlighted to the court by Advocate Gunaratan Sadavarte, who is appearing for the petitioner opposing the Quota. Sadavarte said, “Applications have also been invited under the newly introduced Socially and Educationally Backward Class (SEBC) for the Maratha community.” In response, Senior Counsel V A Thorat, appearing for

BomBay HC pulls up maHarasHtra government for issuing joB reCruitment advertisement under maratHa QuotaMonday, December 10, 2018

the government, stated that only applications have been invited and that the final examination for the jobs will be held in July 2019. Thorat added, “The entire process of filling up the posts will take more than six months.”

national


Read more: http://www.legaleraonline.com/news/drivers-can-show-vehicle-documents-in-electronic-form-when-demanded-by-any-official-madras-hc

Madras High Court

Disposing of various petitions against a memorandum which stated that vehicle drivers should carry original documents including license, the Madras High Court on December 5 followed the Union Government’s notification on the amendment in Rule 139 of the Central Motor Vehicles Rules, 1989 and ruled that drivers can show vehicle documents in electronic form when demanded

drivers Can sHow veHiCle doCuments in eleCtroniC form wHen demanded By any offiCial: madras HCThursday, December 6, 2018

by the police or any other official. As per the amended provision, a citizen can produce transport-related documents such as registration, insurance, fitness and permit, driving license, certificate for pollution under check, and any other relevant documents, if required, in physical or electronic form on demand by any police officer in uniform or any other officer authorized by the State Government in this behalf.During the hearing, the Lorry Owners’ Association informed the bench of the notification on amendment to Rule 139 of Central Motor Vehicle Rules, 1989.Considering this notification, a Division Bench of Justices Dr Vineet Kothari and Dr Anitha Sumanth said, “In view of the amendment brought by Union of India on November 2, the petitions have become infructuous.”

president witHdraws HyderaBad HC judge nakka Balayogi’s resignation Friday, December 14, 2018

Hyderabad High Court

As per a Notification issued by the Ministry of Law and Justice (Department of Justice), Government of India, on December 14, 2018, the President of India has approved the request of withdrawal of resignation by Justice Nakka Balayogi, Judge, High Court of Judicature at Hyderabad for the states of Telangana and Andhra Pradesh. Consequently, notification of even number dated December 03, 2018 regarding his resignation w.e.f. December 15, 2018 stands withdrawn. Now, therefore, Justice Balayogi will continue as Judge of the High Court of Judicature at Hyderabad. On December 03, 2018, Justice Balayogi had resigned from his post as Judge of the Hyderabad High Court. Notably, his resignation was also approved by President Ram Nath Kovind. A Notification issued by the Ministry of Law and Justice on December 03 stated, “Shri Justice Nakka Balayogi has tendered his resignation from the office of Judge of the High Court of Judicature at Hyderabad for the states of Telangana and Andhra Pradesh, in pursuance of proviso (a) to clause (I) of Article 217 of the Constitution, with effect from the afternoon of December 15, 2018.” Justice Balayogi (born January 15, 1957) did his graduation in Commerce from S.K.B.R College, Amalapuram, and B.L. from A.U Law

College, Visakhapatnam. He enrolled as a member on the rolls of the Bar Counsel of Andhra Pradesh on December 22, 1980 and joined the Office of Sri Late V. Venkata Ramaiaiah Garu, Ex. Standing Counsel for South Central Railway and Ex-Advocate General, A.P. High Court, Hyderabad, where he gained exposure to various branches of law. He actively practiced in almost all branches of law at the then High Court of Andhra Pradesh, Hyderabad, and A.P. Administrative Tribunal, Hyderabad. Justice Balayogi was appointed as Munisff Magistrate on October 07, 1985. After rendering services in different places as Junior Civil Judge, Senior Civil Judge, and Additional District Judge, he was promoted as Principal District & Sessions Judge, Kurnool, on June 30, 2010. He served as Chairman, Industrial Tribunal-I, Hyderabad, from April 02, 2012 to November 23, 2013; as Principal Special Judge for CBI Cases, Hyderabad, from November 23, 2013 to July 09, 2015; and as Chief Judge, City Civil Court, Hyderabad, from July 10, 2015 to January 16, 2017.Justice Balayogi was elevated as Judge of the High Court of Judicature at Hyderabad for the state of Telangana and the state of Andhra Pradesh and assumed charge as such on the forenoon of January 17, 2017.

NatioN @ GlaNce


Delhi High Court

ground that he had raised the issue in the Supreme Court which had declined to grant the relief.The Centre then highlighted the availability of various other alternative remedies to the petitioner, Vipul Gambhir, such as using sunscreen cream, sun-shade, protective clothing, and other amenities available in the market to protect himself from the Sun’s UV rays. On the other hand, Gambhir informed the court that due to his disease, doctors have advised him to use solar control film on his vehicle since his condition had deteriorated owing to exposure to UV radiation. Gambhir suffers from xeroderma pigmentosum, a very rare skin disorder where a person is highly sensitive to sunlight (the ability to repair the damage caused by UV light is deficient), has premature skin aging, and is prone to developing skin cancers. However, in opposition, the government turned the spotlight on to the Supreme Court’s April 2012 order which has banned the use of black-colored solar control film on vehicles.

give man witH rare skin disorder speCial Consideration: delHi HC tells CentreSunday, December 9, 2018

delHi HC QuasHes Centre’s deCision to Ban distriBution, manufaCture of oxytoCin By private firmsFriday, December 14, 2018

a subsidiary of Mylan Laboratories, Neon Laboratories, and NGO All India Drug Action Network (AIDAN), which works to ensure access to essential medicines.

In this case, the court noted that “The decision of prohibiting a countrywide existing manufacturing base for Oxytocin, a life-saving drug (through the over hundred private licensed units spread across the country), for over three decades or so, on one hand and reserving it to the public sector through a single manufacturing entity, which has no previous record in its production, is thus fraught with potential adverse consequences.”

On December 14, a bench of Justices S Ravindra Bhat and A K Chawla of the Delhi High Court quashed and set aside the Centre’s decision to ban the manufacture and distribution of Oxytocin—a medication that is used to cause contraction of the uterus to start labor, increase the speed of labor, and stop bleeding following delivery—by private firms in India, stating that the ban was “arbitrary and unreasonable”.

The judgment disposed of a batch of writ petitions challenging the validity of a notification [GSR 411(E) dated 27.04.2018] issued by the Union of India (UOI) and the Ministry of Health & Family Welfare (MHA), in exercise of the powers under Section 26A of the Drugs and Cosmetics Act, 1940. The notification prohibited the manufacture and distribution of Oxytocin injection for domestic use, human use, by private sector companies, including the Petitioners.

The writ petitioners complained that the impugned notification endangers the lives of pregnant women and young mothers. In addition, the Petitioners also challenged the validity of an Office Memorandum dated 21.05.2018.

According to the notification, state-run Karnataka Antibiotics and Pharmaceuticals Ltd (KAPL) was solely allowed by the Centre to make the drug meet the country’s needs. The order came on the pleas of BGP Products Operations GmbH,

As an exception, a bench of Justices S Ravindra Bhat and Prateek Jalan of the Delhi High Court asked the Centre whether a man suffering from a rare skin disorder can be allowed to use solar control film on his vehicle as a “special consideration”. “Can’t you give him a special consideration,” the bench asked the Centre. Notably, the Centre had sought the dismissal of the petitioner’s, Vipul Gambhir’s, plea on the

Read more: http://www.legaleraonline.com/news/delhi-hc-quashes-centres-decision-to-ban-distribution-manufacturing-of-oxytocin-by-private-firms

national


Read more: http://www.legaleraonline.com/news/madras-delhi-high-courts-ban-online-sale-of-medicines

medicines from unlicensed online stores can be risky as they may sell fake, expired, contaminated, unapproved drugs, or otherwise unsafe products that are dangerous to patients and which might put their health at risk.”Earlier, in September, the Union Health Ministry had come out with draft rules on the sale of drugs by e-pharmacies with an aim to regulate online sale of medicines across India and provide patients accessibility to genuine drugs from authentic online portals. The draft rules on “sale of drugs by e-pharmacy” stated that no person will distribute or sell, stock, exhibit or offer for sale of drugs through e-pharmacy portal unless registered. Drugs Controller General of India Eswara Reddy had in September said that rules have been proposed to ensure accessibility and availability of drugs to the people across India, further adding that “After the rules are finalized, people will be able to get genuine drugs through these online pharmacies. These pharmacies will be purchasing directly from the drug manufacturer so they will also be able to give 20-30 per cent discounts, thus benefiting the patients.”

Delhi High Court Order:On December 12, a bench of Chief Justice Rajendra Menon and Justice V K Rao of the Delhi High Court ordered a ban on the sale of online medicines by e-pharmacists across the country and directed the Centre and the AAP government to immediately implement the order.The order arose on a PIL filed by one Zaheer Ahmed, a Delhi-based dermatologist who complained that lakhs of medicines were being sold on the Internet every day without much regulation, posing a huge risk to patients and doctors alike.Ahmed stated that the online sale of medicines is not permitted under the Drugs and Cosmetics Act, 1940 and Pharmacy Act, 1948 and highlighted that even though the Drug Controller General of India in 2015 clearly directed all state drug controllers to protect the interest of public health by restraining such sale online, lakhs of medicines continue to be sold online, often even without prescription.According to Ahmed, the government was unable to supervise the issue and has thus failed in its responsibility to protect public health, which is its constitution obligation under Article 21.

madras & delHi HigH Courts Ban online sale of mediCinesMonday, December 17, 2018

DISCLAIMER: It may be noted that the Legal Era edition publishes select news pieces collated from various sources, based not necessarily on their timeliness and topicality but their interest to its readers.

Buying medicines online is the latest trend among Indian patients and consumers as online pharmacies allow people to buy medicines conveniently and privately. However, in addition to the convenience and privacy, two Indian High Courts have also considered the risks associated with the online sale of medicines.

Madras High Court Order:On December 17, banning the online sale of drugs and medicines, the Madras High Court ordered the Centre to notify the statutory rules related to such sale by January 31, 2019 and stated that pharmacies in the country would be entitled to sell medicines online only after obtaining licenses under the rules that were now in the draft stage and yet to be finalized.This order arose on a writ petition filed by Tamil Nadu Chemists and Druggists Association seeking a ban on websites that facilitate online sale of drugs until the Centre brings into effect a legal framework for permitting such sales.According to the Association, the issue of the online sale of drugs listed in Schedule H, H1m and X of the Drugs and Cosmetics Act of 1940 was rampant in the country though there was a specific legal bar on selling such medicines without the prescription of medical practitioners was of serious concern.The Association further added, “The Drugs and Cosmetics Act was enacted during the colonial era and much before the advent of online trade. Though several amendments had been made to the law over the last 78 years, so far no provision had been introduced in it permitting online sale of drugs and medicines.”It then said, “As per the Drugs and Cosmetics Rules of 1945, it is not permitted to ship, mail, or provide door delivery of the prescribed medicines... Yet, drugs of scheduled and non-scheduled category are available online on different websites and distributed across the country. As on date, there are more than 3,500 such websites.” As per the Association, “While so, online sale is being happily carried on by several websites in violation of existing statutory rules... Despite repeated representations made to the Centre and drug control authorities, the online sale of drugs has not been restrained. There are even advertisements in leading newspapers with heavy discounts.” The Association had in October 2018 said, “Although online shopping might be convenient to consumers, purchasing

Madras & Delhi High Courts

World @ Glance


Read more: http://www.legaleraonline.com/news/quora-says-100-million-users-hit-by-security-breach

Read more: http://www.legaleraonline.com/news/us-supreme-court-to-decide-on-a-patent-case-involving-on-sale-bar

LegaL Updates From across the gLobe

Quora says 100 million users hit by security breach

us supreme court to decide on a patent case involving ‘on-sale bar’

Tuesday, December 4, 2018

Tuesday, December 4, 2018

On December 4, question-and-answer website “Quora” reported unauthorized access to one of its systems by a “malicious third party”, which compromised the personal data of nearly 100 million users.

Quora’s CEO Adam D’Angelo said, “We recently discovered that some user data was compromised as a result of unauthorized access to one of our systems by a malicious third party. We are working rapidly to investigate the situation further and take appropriate steps to prevent such incidents in the future.”

The data allegedly compromised includes: Account and user information (name, email, IP, user ID, encrypted password, user account settings, personalization data); Public actions and content, including drafts (questions, answers, comments, blog posts, upvotes); Data imported from linked networks when authorized by users (contacts, demographic information, interests, access tokens [now invalidated]); Non-public actions (answer requests, down votes, thanks); and Non-public content (direct messages, suggested edits).

In Helsinn Healthcare S.A., (Petitioner,) v. Teva Pharmaceutical USA, Inc., et al., (Respondents), the issue at the Supreme Court of the United States was “Whether, under the Leahy-Smith America Invents Act, an inventor’s sale of an invention to a third party that is obligated to keep the invention confidential qualifies as prior art for purposes of determining the patentability of the invention.”

That is, “Whether the ‘on-sale bar’ prohibiting a patent on an invention that has been on sale for over a year applies to inventions that have been on sale to purchasers who are required to keep their details confidential.” The petitioner argued that the statute required the invention be “on sale”

In this regard, in order to prevent any additional damage, Quora stated that it is now logging out all users who may have been affected, and if they use a password as their authentication method, Quora is invalidating their passwords.

to the general public, which it was not. An amicus curiae supporting the petitioner stated that the invention was not on sale because the purchaser did not use the invention for its intended purpose.

On the other hand, the respondent claimed that the invention was on sale to the public because the court has consistently used the definition “A product that is sold or offered for commercial sale is on sale”.

The petitioner said, in the America Invents Act, Congress transformed the nation’s patent laws. As part of its shift from a first-to-invent to a first-to-file system, Congress revised the definition of “prior art” and clarified the proper understanding of the phrase “on sale”. The on-sale bar, like the other bars in the definition, reaches only a disclosure that makes the claimed invention available to the public. That interpretation is consistent with the plain text of the definition and its legislative history. It’s consistent with the predominant objective of the on-sale bar as repeatedly articulated by this Court; namely, to preserve the public’s access to inventions that have entered the public domain.

United States of America

InternatIonal


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Read more: http://www.legaleraonline.com/home_international/australia-passes-assistance-and-access-bill-enable-police-to-access-encrypted-data-2

us sc to appeals court: reconsider case challenging mandatory fees lawyers pay to state bar association

australia passes “assistance and access” bill, enables police to access encrypted data

Monday, December 3, 2018Thursday, December 6, 2018

The US Supreme Court asked the US Court of Appeals for the Eighth Circuit to reconsider a case challenging mandatory fees lawyers pay to a state bar association.

Issues in this case were:

• Whether it violates the First Amendment for state law to presume that the petitioner [Arnold Fleck] consents to

subsidizing non-chargeable speech by the group he is compelled to fund (“opt-out” rule), as opposed to an “opt-in” rule whereby he must affirmatively consent to subsidizing such speech.

• Whether Keller v. State Bar of California and Lathrop v. Donohue should be overruled insofar as they permit the state to force the petitioner to join a trade association he opposes as a condition of earning a living in his chosen profession.

North Dakota attorney Arnold Fleck challenged mandatory fees attorneys pay to the State Bar Association of North Dakota claiming that the Association uses the fees to oppose a state ballot measure (to establish a presumption that each parent is entitled to equal parental rights) which he personally supported.

Fleck then asked whether the court will “permit the state to force Petitioner to join a trade association he opposes as a condition of earning a living in his chosen profession.”

North Dakota’s fees range from $325 to $380. However, lawyers who are not interested in supporting the bar’s political activities can deduct about $10.

Amid critically increasing incidents of terrorist attacks and crime, the Australian Labor Party (ALP) on December 6 voted to pass a controversial encryption bill called “Assistance and Access” Bill, introducing changes to Australia’s telecommunication laws by allowing police and security agencies to issue notices to technology firms such as Alphabet Inc’s Google, Facebook, and Apple to enable access to encrypted data for investigation purposes. Praising the Bill, Australia’s Attorney-General Charles Christian Porter said, “This ensures that our national security and law enforcement agencies have the modern tools they need, with appropriate authority and oversight, to access the encrypted conversations of those who seek to do us harm.”

On the other hand, Critics fear that the vote sets a dangerous precedent and also fear about the ramifications of the bill’s vague language. According to the Bill, an intended communication provider is “a person who provides an electronic service that has one or more end-users in Australia”. The Critics mentioned that this definition of an intended communication provider covers almost every website accessible in Australia.

Your favorite magazine is now available on your mobile smartphone. Keep yourself up-to-date on the latest updates with the digital version!

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United States of America Australia

World @ Glance


pioneer revitalization plan: baring private eQuity asia to invest 77 billion yen in pioneerFriday, December 7, 2018

On December 7, Baring Private Equity Asia (BPEA) and Pioneer Corporation in a joint press release announced the Pioneer Revitalization Plan which comprises 77 billion yen (approx. $900 million) investment from BPEA in Pioneer and a cash offer from BPEA to existing Pioneer shareholders of approximately 25 billion yen.

The plan aims to bring stability to the business by securing vital working capital and management support from BPEA and removing uncertainty about the Company’s ability to continue sustainable operations. The Release stated, “To address the urgent need to bring Pioneer back to a sound

financial position, given its deteriorating cash flow, BPEA plans to invest 77 billion yen (52 billion yen in cash as a capital injection together with a 25-billion-yen debt-for-equity swap) immediately following shareholder approval at an extraordinary shareholders’ meeting and the completion of the required filings. These steps will secure working capital vital for Pioneer’s business operations. BPEA will then make a cash offer of about 25 billion yen to purchase all outstanding shares from the existing Pioneer shareholders and take the Company private.”

The Release further added, “Once privatized, a range of significant changes will be made to revitalize Pioneer, including reviews of the Company’s business lines as well as structural reforms and an overhaul of the management team.”

BPEA and Pioneer are confident that the Pioneer Revitalization Plan offers the best option to take the Company back to a sound operational footing and return to a growth path.Read more: http://www.legaleraonline.com/news/pioneer-revitalization-plan-baring-private-equity-asia-to-invest-77-billion-yen-in-pioneer

Read more: http://www.legaleraonline.com/news/home-secretary-issues-white-paper-on-the-uks-future-skills-based-immigration-system

home secretary issues white paper on “the uK’s future sKills-based immigration system”Wednesday, December 19, 2018

On December 19, UK Home Secretary Sajid Javid set out plans for a new single, skills-based immigration system which marks the end of free movement.

The UK government on its website issued details on the new immigration system. The website stated, “The new immigration system will introduce a new route for skilled workers which favors experience and talent over nationality. It will enable employers to have access to the skills they need from around the world, while ensuring net migration is reduced to sustainable levels.”

It added that the White Paper proposals will, in line with the recommendations made by the Migration Advisory Committee (MAC), remove the annual cap on the number of work visas issued, widen the skills threshold to include people with qualifications equivalent of A levels, and end the requirements for labor market tests by employers wanting to sponsor a worker.

In this regard, Home Secretary Javid said, “Today’s proposals are the biggest change to our immigration system in a generation... We are taking a skills-based approach to ensure we can attract the brightest and best migrants to the UK... These measures will boost our economy and benefit the British people.”

Asia

United Kingdom

Sajid Javid

InternatIonal


Wednesday, December 12, 2018

The Court of Justice of the European Union, in a Press Release issued on December 10, ruled in Wightman and Others v Secretary of State for exiting the European Union that “the United Kingdom is free to revoke unilaterally the notification of its intention to withdraw from the EU.”

The Full Court ruled that when a Member State has notified the European Council of its intention to withdraw from the EU, as the UK has done, that Member State is free to revoke unilaterally that notification. The Court further added, “That possibility exists for as long as a withdrawal agreement concluded between the EU and that Member State has not entered into force or, if no such agreement has been concluded, for as long as the two-year period from the date of the notification of the intention to withdraw from the EU, and any possible extension, has not expired.”

The Court then said, “The revocation must be decided following a democratic process in accordance with national constitutional requirements. This unequivocal and

unconditional decision must be communicated in writing to the European Council. Such a revocation confirms the EU membership of the Member State concerned under terms that are unchanged as regards its status as a Member State and brings the withdrawal procedure to an end.”

According to the court, “In the absence of an express provision governing revocation of the notification of the intention to withdraw, that revocation is subject to the rules laid down in Article 50(1) TEU for the withdrawal itself, with the result that it may be decided unilaterally, in accordance with the constitutional requirements of the Member State concerned. The revocation by a Member State of the notification of its intention to withdraw reflects a sovereign decision to retain its status as a Member State of the European Union, a status which is neither suspended nor altered by that notification.”

eu court of Justice: uK can unilaterally revoKe its notification of intention to withdraw from eu

Read more: http://http://www.legaleraonline.com/news/eu-court-of-justice-uk-can-unilaterally-revoke-its-notification-of-intention-to-withdraw-from-eu

hungary passes amendments to labor laws that significantly benefit employersWednesday, December 12, 2018

On December 12, in a move that is said to benefit employers, Hungarian Lawmakers, voting 130-52, passed certain amendments to the nation’s labor laws. The amendments, proposed by Prime Minister Viktor Orban’s party, were criticized by several trade unions and opponents as “slave law”.

As per the new legislation, • amount of overtime hours that employers can require

employees to work in a year has been increased from 250 to 400;

• employers now have three years instead of one to settle payments of accrued overtime;

• employers can offer payment in the form of salary or vacation;

• employers can agree on overtime arrangements directly with workers, undermining the role of unions and collective bargaining in the employment process.

According to the Critics, the increase in the overtime hours from 250 to 400 per year is equivalent to adding a full day

to the work week and is thus exploitative, thus increasing the potential health risk for employees.

Notably, the amendments were proposed by the nation’s leading party with the aim of addressing the issue of labor shortage, attracting investors, and improving economic growth. The government stated that it will allow employers to be more flexible.

In this regard, PM Orbán said, “We have to remove bureaucratic rules so that those who want to work and earn more can do so.”

On the other hand, the Hungarian Helsinki Committee,a non-governmental human rights organization, stated that the legislation was “a serious threat to the rule of law in Hungary and runs counter to values Hungary signed up to when it joined the European Union.”

The amendments have caused severe discontent among citizens and trade unions and have also attracted a lot of protests.

DISCLAIMER: It may be noted that the Legal Era edition publishes select news pieces collated from various sources, based not necessarily on their timeliness and topicality but their interest to you.

Europe

NotificatioNs


MHA issues NotificAtioN oN AgreeMeNt oN trANsfer of seNteNced PersoNs betweeN iNdiA, sPAiNTuesday, November 27, 2018

The Ministry of Home Affairs (Women Safety Division) on November 27, 2018 issued a Notification detailing the “Agreement between the Republic of India and the kingdom of Spain on the transfer of sentenced persons”. The Agreement was signed on May 30, 2017 and was ratified by the Government of India on July 3, 2017 and by the Government of Spain on May 30, 2018.

The Notification statedIn the exercise of the powers conferred by sub-sections (1) and (2) of Section 3 of the Repatriation of Prisoners Act, 2003 (49 of 2003), the Central Government hereby directs that the provisions of the said Act shall apply to the Government of the Kingdom of Spain.

Highlights of the AgreementThe Government of the Republic of India and the Government of the Kingdom of Spain, hereinafter referred to as the Contracting States, desiring to facilitate the social rehabilitation of sentenced persons into their own countries, and considering that this objective should be fulfilled by giving foreign nationals, who have been convicted and sentenced as a result of their commission of a criminal offense, the opportunity to serve their sentences in their own society, have agreed as follows:

• General Principles1. A person sentenced in the territory of one Contracting

State may be transferred to the territory of the other Contracting State in accordance with the provisions of this Agreement in order to serve the sentence imposed on him. To that end, he may express to the transferring State or the receiving State his willingness to be transferred under this Agreement.

2. Transfer may be requested by any sentenced person who is a national of a Contracting State or by any other person who is entitled to act on his behalf in accordance with the law of the Contracting State by making an application to the Contracting State and in the manner prescribed by the Government of that Contracting State.

• Central Authorities1. Authorities in charge of the implementation of this

Agreement for the Contracting States are:

- For the Republic of India: Ministry of Home Affairs.- For the Kingdom of Spain: Ministry of Justice

2. In case either Contracting State changes its competent authorities, it shall notify the other State of the same through diplomatic channels.

• Conditions for transfer1. A sentenced person may be transferred under this

Agreement on the following conditions:(a) the person is a national of the receiving State;(b) the death penalty has not been imposed on the

sentenced person; except the case where the sentence has been commuted;

(c) the judgment is final;(d) no criminal proceedings are pending against the

sentenced person in the transferring State in which his presence is required;

(e) the sentenced person has not been convicted for an offense under military law except in circumstances where the Contracting States agree otherwise;

(f) at the time of receipt of request for transfer, the sentenced person still has at least one year of the sentence to serve;

(g) that the acts or omissions for which that person was sentenced in the transferring State are those which are punishable as a crime in the receiving State, or would constitute a criminal offense if committed on its territory;

(h) transfer of custody of the sentenced person to the receiving State shall not be detriment to the sovereignty, security or any other essential interest of the transferring State;(i) consent to the transfer is given by the sentenced

person or, where in view of his age or physical or mental condition either Contracting State considers it necessary, by any other person entitled to act on his behalf in accordance with the law of the Contracting State; and

(j) the transferring and receiving States agree to the transfer.

2. In exceptional cases, the transferring and receiving States may agree to a transfer even if the remaining period to be served by the sentenced person is less than specified in paragraph 1(f).

• Obligation to furnish information1. If the sentenced person has expressed an interest to the transferring State in being transferred under this Agreement, the transferring State shall send the following information and documents to the receiving State unless either the receiving or the transferring State has already decided that it will not agree to the transfer:

Read more: http://www.legaleraonline.com/news/mha-issues-notification-on-agreement-on-transfer-of-sentenced-persons-between-india-spain

NotificatioNs


NotificAtioN issued regArdiNg sebi (settLeMeNt ProceediNgs) reguLAtioNs, 2018Monday, December 03, 2018

The Securities and Exchange Board of India (SEBI) recently issued a Notification regarding the Securities and Exchange Board of India (Settlement Proceedings) Regulations, 2018, which provide for the terms of settlement and the procedure of settlement and matters connected therewith or incidental thereto. As per the Notification, in the exercise of the powers conferred by Section 15JB of the Securities and Exchange Board of India Act, 1992; Section 23JA of the Securities Contracts (Regulation) Act, 1956; and Section 19-IA of the Depositories Act, 1996 read with Section 30 of the Securities and Exchange Board of India Act, 1992; Section 31 of the Securities Contracts (Regulation) Act, 1956; and Section 25 of the Depositories Act, 1996, SEBI has made the Securities and Exchange Board of India (Settlement Proceedings) Regulations, 2018 to provide for the terms of settlement and the procedure of settlement and matters connected therewith or incidental thereto.Notably, these Regulations shall come into force on January 1, 2019.The Notification includes:APPLICATION FOR SETTLEMENTApplication 1) A person against whom any specified proceedings have

been initiated and are pending or may be initiated, may make an application to the Board in the Form specified in Part-A of the Schedule-I.

2) The application made under sub-regulation (1) shall be accompanied by a non-refundable application fee as specified in Part-B of Schedule I and the undertakings and waivers as specified in Part-C of Schedule-I:

Provided that the rejection or withdrawal of the application shall not affect the continued validity of the undertakings and waivers given in respect of limitation or lapses in respect of the initiation or continuation or restoration of any legal proceeding and the waivers given under sub-paras (d), (e), (f) and (g) of para 12 of the undertaking and waivers as provided in Part-C of the Schedule-I and subject to such undertakings and waivers, the Board or the applicant, shall be free to initiate or pursue such proceedings as may be appropriate in accordance with law.

3) The applicant shall make full and true disclosures in the application in respect of the alleged default(s):

Provided that the facts established against the applicant or admitted in any ongoing or concluded proceedings in India or outside India, with respect to the same cause of action, under any law, shall be deemed to be admitted by the applicant in respect of the proceedings proposed to be settled.

4) The applicant shall make one application for settlement of all the proceedings that have been initiated or may be initiated in respect of the same cause of action.

5) An application that is not complete in all respects or does not conform to the requirements of these regulations shall be returned to the applicant.

6) The applicant whose application has been returned under sub-regulation (5) may, within fifteen days from the date of communication from the Board, submit the complete and revised application that conforms to the requirements of these regulations:

Provided that no further opportunity shall be given to the applicant to make an application in respect of the alleged default at the same stage of the proceedings, as indicated in Table I in Schedule-II.

7) Where the applicant is an association or a firm or a body corporate or a limited liability partnership, the application and undertakings and waivers shall be executed by the person in charge of, and responsible for the conduct of the business of such firm or association or body corporate and the same shall bind the firm or association, the body corporate and any officer who is in default.

8) An application for settlement of defaults related to disclosures, shall to the extent possible, be made after making the required disclosure.

Limitation 1) An application in respect of any specified proceeding

pending before the Board shall not be considered if it is made after sixty days from the date of service of the notice to show cause or supplementary notice(s) to show cause, whichever is later.

2) Notwithstanding anything contained in sub-regulation (1), the Board may consider the application, if satisfied that there was sufficient cause for not filing it within the specified period and it is accompanied with non-refundable fees as specified in Part-B of the Schedule-I.

Read more: http://www.legaleraonline.com/news/securities-and-exchange-board-of-india-settlement-proceedings-regulations-2018

NotificatioNs


MeitY issues drAft oN “tHe iNforMAtioN tecHNoLogY [iNterMediAries guideLiNes (AMeNdMeNt) ruLes] 2018Monday, December 24, 2018

The Ministry of Electronics & Information Technology (MeitY), Government of India, issued a draft on “The Information Technology [Intermediaries Guidelines (Amendment) Rules] 2018”, which shall come into force on the date of their publication in the Official Gazette.The draft states:Due diligence to be observed by intermediary — The intermediary shall observe following due diligence while discharging his duties, namely: (1) The intermediary shall publish the rules and regulations,

privacy policy and user agreement for access-or usage of the intermediary’s computer resource by any person

(2) Such rules and regulations, privacy policy or user agreement shall inform the users of computer resource not to host, display, upload, modify, publish, transmit, update or share any information that —(a) belongs to another person and to which the user does

not have any right;(b) is grossly harmful, harassing, blasphemous,

defamatory, obscene, pornographic, paedophilic, libellous, invasive of another’s privacy, hateful, or racially, ethnically objectionable, disparaging, relating or encouraging money laundering or gambling, or otherwise unlawful in any manner whatever;

(c) harm minors in any way;(d) infringes any patent, trademark, copyright or other

proprietary rights;(e) violates any law for the time being in force;(f) deceives or misleads the addressee about the origin

of such messages or communicates any information which is grossly offensive or menacing in nature;

(g) impersonates another person;(h) contains software viruses or any other computer code,

files or programs designed to interrupt, destroy or limit the functionality of any computer resource;

(i) threatens the unity, integrity, defence, security or sovereignty of India, friendly relations with foreign states, or public order, or causes incitement to the commission of any cognisable offence or prevents investigation of any offence or is insulting any other

nation.(j) threatens public health or safety; promotion

of cigarettes or any other tobacco products or consumption of intoxicant including alcohol and Electronic Nicotine Delivery System (ENDS) & like products that enable nicotine delivery except for the purpose & in the manner and to the extent, as may be approved under the Drugs and Cosmetics Act, 1940 and Rules made thereunder;

(k) threatens critical information infrastructure.(3) The intermediary shall not knowingly host or publish any

information or shall not initiate the transmission, select the receiver of transmission, and select or modify the information contained in the transmission as specified in sub-rule (2):

Provided that the following actions by an intermediary shall not amount to hosting, publishing, editing or storing of any such information as specified in subrule (2):

(a) temporary or transient or intermediate storage of information automatically within the computer resource as an intrinsic feature of such computer resource, involving no exercise of any human editorial control, for onward transmission or communication to another computer resource;

(b) removal of access to any information, data or communication link by an intermediary after such information, data or communication link comes to the actual knowledge of a person authorised by the intermediary pursuant to any order or direction as per the provisions of the Act;

(4) The intermediary shall inform its users at least once every month, that in case of non-compliance with rules and regulations, user agreement and privacy policy for access or usage of intermediary computer resource, the intermediary has the right to immediately terminate the access or usage rights of the users to the computer resource of Intermediary and remove non-compliant information.

(5) When required by lawful order, the intermediary shall, within 72 hours of communication, provide such information or assistance as asked for by any government agency or assistance concerning security of the State or cyber security; or investigation or detection or prosecution or prevention of offence(s); protective or cyber security and matters connected with or incidental thereto. Any such request can be made in writing or through electronic means stating clearly the purpose of seeking such information or any such assistance. The intermediary shall enable tracing out of such originator of information on its platform as may be required by government agencies who are legally authorised.

Read more: http://www.legaleraonline.com/news/meity-issues-draft-on-the-information-technology-intermediaries-guidelines-amendment-rules-2018

NotificatioNs


Read more: http://www.legaleraonline.com/news/non-resident-participation-in-rupee-interest-rate-derivatives-markets-reserve-bank-directions-2018-rbi

Read more: http://www.legaleraonline.com/news/msde-notification-on-constitution-of-national-council-for-vocational-education-and-training

Msde NotificAtioN oN coNstitutioN of NAtioNAL couNciL for VocAtioNAL educAtioN ANd trAiNiNg

NoN-resideNt PArticiPAtioN iN ruPee iNterest rAte deriVAtiVes MArkets (reserVe bANk) directioNs, 2018: rbi

Wednesday, December 5, 2018 Wednesday, December 5, 2018

The Ministry of Skill Development and Entrepreneurship issued a Notification on December 5 regarding the constitution of a Council called the National Council for Vocational Education and Training.

The Notification states:In pursuance of the decision of the Cabinet in its meeting held on October 10, 2018, the National Council for Vocational Education and Training is hereby notified as follows: (a) The National Council for Vocational Education and

Training constituted under paragraph 2 will subsume the existing National Council for Vocational Training and the National Skill Development Agency.

(b) The National Council for Vocational Education and Training shall be entrusted with the development, qualitative improvement and regulation of vocational education and training, for granting recognition to and monitoring the functioning of awarding bodies, assessment agencies, skill information providers, and training bodies, and to perform other incidental functions as specified in this Resolution.

Functions of the Council are as follows: (1) The Council shall:• recognize, monitor, discipline and de-recognize

awarding bodies;• recognize, monitor, discipline and de-recognize

assessment agencies;• recognize, monitor, discipline and de-recognize skill

related information providers;• recognize Skills Universities as a separate category of

bodies for providing advanced vocational education and training programs and conducting research and development in skill education and training;

• create and monitor, a system of redressing grievances against recognized bodies;

• frame guidelines for the approval of qualification packages, and approve qualification packages in the manner set out in such guidelines.

The Reserve Bank of India (RBI) issued a Notification on December 05 regarding the ‘Non-resident Participation in Rupee Interest Rate Derivatives Markets (Reserve Bank) Directions, 2018’. These Directions shall be applicable to Rupee interest rate derivative transactions in India, undertaken on recognized stock exchanges, electronic trading platforms (ETP), and Over-the-Counter (OTC) to the extent stated herein. The Directions shall come into force with immediate effect.The Notification States:The Reserve Bank of India (hereinafter called ‘the Reserve Bank”) having considered it necessary in public interest and to regulate the financial system of the country to its advantage, in exercise of the powers conferred by Section 45W of the Reserve Bank of India Act, 1934, (hereinafter called ‘the Act”) read with Section 45U of the Act and of all the powers enabling it in this behalf, hereby issues the following Directions to all entities including the non-residents, eligible to participate or transact in interest rate derivatives in India.Purpose:Non-residents can participate in Rupee interest rate derivatives for the following purposes:• To hedge exposure to Rupee interest rate risk and• For the purpose other than hedging as stipulated in Para

4 (2) below.Terms and conditions:Non-resident undertaking Rupee interest rate derivatives transactions shall adhere to the following terms and conditions:(1) Transactions undertaken to hedge exposure:• Non-resident may undertake any Over-the-Counter

(OTC) interest rate derivative contract that is based on a domestic Rupee benchmark interest rate administered by FBIL.

• Non-resident may contract any interest rate derivative on a recognized stock exchange.

• Market makers shall ensure that transactions are being carried out for the purpose of hedging.

(2) Transactions undertaken for purposes other than hedging:i. Foreign Portfolio Investors (FPIs) collectively may take

net long position in interest rate futures (IRF) up to the limit of INR 5000 crore in terms of RBI circular No. FMRD.DIRD.6/14.03.001/2017-18 dated March 01, 2018.

ii. A non-resident, other than an individual, may also undertake Overnight Indexed Swaps (OIS) for any purpose other than hedging, subject to the following conditions.

NotificatioNs


Read more: http://www.legaleraonline.com/news/disclosure-of-significant-beneficial-ownership-in-shareholding-pattern-sebi

sebi issues circuLAr oN discLosure PertAiNiNg to sigNicANt beNeficiAL owNers iN sHAreHoLdiNg PAtterNFriday, December 07, 2018

On December 7, the Securities and Exchange Board of India (SEBI) issued a Circular to all listed entities, recognized stock exchanges, and Depositories on disclosing details pertaining to significant beneficial owners in the shareholding pattern.The Circular was issued in the exercise of the powers conferred under Sections 11 and 11A of the Securities and Exchange Board of India Act, 1992 read with Regulations 31 and 101(2) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. It shall come into force with effect from the quarter ended March 31, 2019.

The Circular states:1. Vide SEBI Circular No. CIR/CFD/CMD/13/2015 dated

November 30, 2015, a format has been prescribed for disclosure of holding of specified securities and shareholding pattern under Annexure-I to the circular.

2. Vide notification dated June 14, 2018, Ministry of Corporate Affairs has notified the Companies (Significant Beneficial Owners) Rules, 2018 under which various requirements pertaining to disclosures regarding Significant Beneficial Owners have been specified.

3. In the interest of transparency to the investors in the securities market, the following is specified: 3.1 All listed entities shall disclose details pertaining to

significant beneficial owners in the format prescribed at Annexure to this circular.

3.2 The format specified in the Annexure to this circular shall be Table V under clause 5 of the format of holding of specified securities specified in the aforesaid Circular No. CIR/CFD/CMD/13/2015 dated November 30, 2015. Circular No. CIR/CFD/CMD/13/2015 dated November 30, 2015 shall stand modified to that extent.

3.3 All the terms specified in this circular shall have the same meaning as specified in Companies (Significant Beneficial Owners) Rules, 2018.

rbi issues NotificAtioN oN reLAXAtioN of guideLiNes to Nbfcs oN securitiZAtioN trANsActioNsTuesday, December 04, 2018

The Reserve Bank of India (RBI) recently issued a Notification to all Non-Banking Financial Companies (NBFCs) with regard to “Relaxation on the guidelines to NBFCs on securitization transactions”.The Notification stated: • Please refer to the Guidelines on Securitization

Transactions vide paragraph 102 of Master Directions on Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions dated

September 01, 2016 and paragraph 89 of Non-Banking Financial Company – Non-Systemically Important Non-Deposit taking Company (Reserve Bank) Directions dated September 01, 2016.

• In order to encourage NBFCs to securitize/assign their eligible assets, it has been decided to relax the Minimum Holding Period (MHP) requirement for originating NBFCs, in respect of loans of original maturity above 5 years, to receipt of repayment of six monthly installments or two quarterly installments (as applicable), subject to the following prudential requirement:

Minimum Retention Requirement (MRR) for such securitization/assignment transactions shall be 20% of the book value of the loans being securitized/20% of the cash flows from the assets assigned.

• The above dispensation shall be applicable to securitization/assignment transactions carried out during a period of six months from the date of issuance of this circular. Other terms and conditions of the above referred Directions remain the same.

NotificatioNs


Read more: http://www.legaleraonline.com/news/sebi-presents-detailed-regulatory-framework-on-cyber-security-and-cyber-resilience

sebi PreseNts detAiLed reguLAtorY frAMework oN cYber securitY ANd cYber resiLieNceFriday, December 07, 2018

Recognizing the need for a robust Cyber Security and Cyber Resilience framework at Market Infrastructure Institutions (MIIs), i.e., Stock Exchanges, Clearing Corporations, and Depositories, the Securities and Exchange Board of India (SEBI) issued a Circular presenting a detailed regulatory framework on cyber security and cyber resilience.

The Circular states:

1. This Circular is being issued in the exercise of powers conferred under Section 11 (1) of the Securities and Exchange Board of India Act, 1992 and Section 19 of the Depositories Act, 1996 to protect the interests of investors in securities and to promote the development of and to regulate the securities market.

2. With the view to further strengthening the aforesaid framework, particularly in respect of monitoring of cyber threats and cyber resiliency, the matter was discussed with SEBI’s Technical Advisory Committee (TAC), SEBI’s High Powered Committee on Cyber Security (HPSC-CS), and the MIIs.

3. Accordingly, it has been decided that MIIs shall have a Cyber Security Operation Center (C-SOC) that would be a 24x7x365 set-up manned by dedicated security analysts to identify, respond, recover, and protect from cyber security incidents.

4. The C-SOC shall function in accordance with the framework specified in SEBI Circular CIR/MRD/DP/13/2015 dated July 06, 2015. Illustrative list of broad functions and objectives to be carried out by a C-SOC are mentioned hereunder: 4.1 Prevention of cyber security incidents through

proactive actions: (a) Continuous threat analysis, (b) Network and host scanning for vulnerabilities and

breaches,(c) Countermeasure deployment coordination, (d) Deploy adequate and appropriate technology

at the perimeter to prevent attacks originating from external environment and internal controls to manage insider threats. MIIs may implement necessary controls to achieve zero trust security model.

4.2 Monitoring, detection, and analysis of potential intrusions / security incidents in real-time and through historical trending on security-relevant data sources.

4.3 Response to confirmed incidents, by coordinating resources and directing use of timely and appropriate countermeasures.

4.4 Analysis of the intrusions / security incidents (including Forensic Analysis and Root Cause Analysis) and preservation of evidence.

4.5 Providing situational awareness and reporting on

cyber security status, incidents, and trends in adversary behavior to appropriate organizations including to CERT-In and NCIIPC.

4.6 Engineer and operate network defense technologies such as Intrusion Detection Systems (IDSes) and data collection / analysis systems.

4.7 MIIs to adopt security automation and orchestration technologies in C-SOC to automate the incident identification, analysis and response as per the defined procedures.

5. Further to the above, the C-SOC of MII shall, at the minimum, undertake the following activities: 5.1 In order to detect intrusions / security incidents in

real time, the C-SOC should monitor and analyze on a 24x7x365 basis relevant logs of MII’s network devices, logs of MII’s systems, data traffic, suitable cyber intelligence (intel) feeds sourced from reliable vendors, inputs received from other MIIs, inputs received from external agencies such as CERT-In, etc. The cyber intelligence (intel) feeds may include cyber news feeds, signature updates, incident reports, threat briefs, and vulnerability alerts.

5.2 To this end, appropriate alert mechanisms should be implemented including a comprehensive dashboard, tracking of key security metrics and provide for cyber threat scorecards.

5.3 The C-SOC should conduct continuous assessment of the threat landscape faced by the MII including undertaking periodic VAPT (Vulnerability Assessment and Penetration Testing).

5.4 The C-SOC should have the ability to perform Root Cause Analysis, Incident Investigation, Forensic Analysis, Malware Reverse Engineering, etc. to determine the nature of the attack and corrective and/or preventive actions to be taken thereof.

Within the CirCle


Samvad PartnerS, JSa act in ntt’S acquiSition of 55% Stake in atom technologieS for $9 mn

merchants. Moreover, our customer base and development capability will allow Atom to upward its growth-trajectory. We commit to contributing to the Indian society with better payments services by partnering with Atom.”

Subsequently, 63 moons’ MD and CEO S Rajendran said, “Atom is one of the first companies in India to offer online digital payments services. The company has grown exponentially over the years and has great potential to grow further. In line with the strategy of 63 moons to exit from the market ecosystem, we were looking for a reliable partner that would elevate our institution to greater heights.”

Thereafter, Atom’s CEO Dewang Neralla said, “This acquisition endorses the immense value created by Atom. We look forward to greater synergies and to implement NTT’s global learning into the Indian markets and thereby further enhance the payments ecosystem in the country.”

LAW FIRMS INVOLVED:NTT Data was represented by Samvad Partners. The team included Partner Harish Narasappa and Associates Vandana V and Surabhi Rao. 63 moons and Atom were advised by J Sagar Associates. The team included Partner Rinku Ambekar and Associate Reshma Oak.

trilegal’S counSel arPan chowdhury JoinS SSg adviSorS llP aS vice PreSident legalArpan Chowdhury, Counsel at Trilegal, recently joined SSG Advisors LLP as its Vice President Legal. He focuses on special situations and distressed asset-related work and will work with Director and Senior Legal Counsel Praveen Thomas. Arpan was a Counsel in the Mumbai office of Trilegal and was part of the corporate practice. He specializes in advising on domestic as well as cross-border investments through equity and structured debt.

Arpan has specialist experience in advising corporates, private equity investors, and financial institutions on inbound and outbound acquisitions, corporate restructurings, and business transfers. Recently, he was also involved in advising acquirers, lenders, and resolution professionals in multiple situations under India’s new insolvency regime.

Arpan has also extensively advised banks, financial institutions, foreign portfolio investors and sponsors on structured and mezzanine financings in India as well as on offshore transactions involving Indian parties. He has also advised on a number of acquisition financing and margin financing transactions.

Arpan’s roles on transactions usually involve conducting due diligences, drafting and negotiating transaction documents, liaising with regulatory authorities, and advising clients on Indian law issues.

He is an alumnus of the National University of Juridical Sciences, Kolkata, and a Member of the Bar Council of West Bengal, India.

NTT Data Corporation (a Japanese system integration company and partially-owned subsidiary of Nippon Telegraph and Telephone) recently acquired 55.35% stake in Atom Technologies (a payment services provider company and a subsidiary of 63 moons technologies limited) for an aggregate consideration of $9.24 million.

In this regard, NTT Data’s SVP Isao Arima said, “We believe the Indian payments market has huge potential, pillared by consistent economic growth and the government’s strong initiative towards digital payments. Our payments business in Japan, as well as South East Asia, will help Atom in providing cross-border payments services to their

Arpan Chowdhury

S Rajendran

Within the CirCle


dSk legal, dua aSSociateS aSSiSt aShiana houSing, grSindia in management agreement

Services across India. GRSIndia is poised to offer seniors the quality care they need as they are aging. In addition to pioneering new and innovative clinical and rehabilitation services in India, the Company looks to provide seniors with the independence and lifestyle that they are accustomed to.” The Release added, “GRSIndia has a strategic partnership with Genesis Rehabilitation Services LLC, International Operations (GRS International Operations), a USA company located in Kennett Square Pennsylvania to leverage their operational, management, nursing, and rehabilitation multi-site management expertise to deliver positive outcomes geared towards the health and well-being of seniors in India.”

The Release concluded, “Ashiana believes that this arrangement with GRSIndia will enhance the quality of care being provided in Utsav Care Homes along with the expertise that GRS International Operations is known for.”

LAW FIRMS INVOLVED:Ashiana was represented by DSK Legal. The team included Partner Niraj Kumar and Principal Associate Prachi Gupta.

GRSIndia was advised by Dua Associates.

khaitan, raJaram, S&r act in delightful gourmet’S $25 million SerieS d funding round led by nichirei Delightful Gourmet Pvt Ltd, a Bengaluru-based firm which runs meat and fish ordering startup Licious, recently raised $25 million in a Series D funding round led by Nichirei Corporation, one of Japan’s top producers of frozen foods and a leader in cold storage warehousing. Also, existing investors 3one4 Capital, Bertelsmann India Investments, Vertex Ventures Southeast Asia and India, UCLA, Sistema Asia Fund also participated in the round.

In this regard, Licious’ Co-Founders Abhay Hanjura and Vivek Gupta said, “The confidence we continue to receive from our new and existing investors fortifies our unstinting commitment to offer world-class quality meat and seafood to our customers every time... these funds will greatly aid our vision to build an Indian food brand with a global outlook.”

Subsequently, Bertelsmann’s MD Pankaj Makkar said, “With Nichirei Corp, we are excited to have a strong partner which will help build next generation cold supply chain and other innovations in the food category. The investment is a testimonial to Vivek and Abhay’s vision....”

LAW FIRMS INVOLVED:Nichirei was advised by Khaitan & Co. The team included

Partner Vineet Shingal, Principal Associate Tanushree Bhuwalka, and Associate Srikanth Mantravadi. In addition, the team was also assisted on the due diligence aspects by Associate Rimjhim Khandelwal; IP-related aspects by Counsel Shailendra Bhandare and Associate Sourav Dan; and real estate-related aspects by Senior Associate Sneha Oak Joshi and Associate Swaraj Singh Narula.

Licious was represented by Rajaram Legal. The team was led by Partner Priyadarshani Sherchan and included Associates Aakanksha Pagnis and Hemanth Joseph.

Bertelsmann was advised by S&R Associates. The team was led by Partner Rachael Israel and included Associates Upasana Gupta and Eshika Maji.

Ashiana Housing Ltd in a recent Press Release stated that it has entered into a Management Agreement with Genesis Rehabilitation Services India Pvt. Ltd. to manage and operate Utsav Care Homes - Bhiwadi (Rajasthan), a part of Senior Living development Ashiana Utsav.

The Release stated, “Genesis Rehabilitation Services India Pvt. Ltd. (GRSIndia), an operator of Senior Care and Rehabilitation Services, will offer various levels of Senior Care Services, including Independent Living, Assisted Living, Memory Care, Long Term Care and Rehabilitation

8th ANNUAL

2019Business & Law Congress

GlobaliZation for business & lawyerseminent speakers

Hon'

ble

M. V

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Naid

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Vice President of India

Chairman Bankruptcy Law Reforms

Committee

Senior Counsel Bombay High Court



Hon'

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Just

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Hans

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Dr. C

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Davi

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Geof

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Padm

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Hon'

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Just

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Moh

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Former Chief Justice Bombay High Court

Hon'

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Just

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A. K

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Judge Supreme Court of India

Former Judge Regional Court Munich,

Germany

Sr. VP, International Cyber Strategy, Policy

& Law, Center for Strategic Cyber Space

& Security Science

Director, Strategic Communications

Nigerian Investment Promotion Commission

(NIPC)

Criminal Lawyer, Former Prosecutor Of The Canton

Of Zurich; Chairman, Investigatory Chamber, Ethics Committee, FIFA

Immediate Past-President, In-House Counsel Worldwide; Member, BlackRock

Canada IRC

Partner, Johnson Winter & Slattery, and Immediate

Past Co-Chair, IBA,Anti-Corruption

Committee, Australia

Managing Partner Perchstone & Graeys

And many more...

Minister of Law & Justice and Electronics & Information Technology,

Government of India

Hon'

ble

Ravi

Sha

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Pr

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Hon'

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Deve

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Fa

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Hon'

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P.P. C

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Hon'

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Sure

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Minister of Commerce & Industry and Civil Aviation,

Govt. of India

Chief Minister of Maharashtra

Union Minister of State, Ministry of Law and Justice;

& Ministry of Corporate Affairs, Govt. of India

***Invited

14th - 16th March 2019 Hotel Taj Lands End

Mumbai, India

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reGulatory and reputation risks in a nationalistic Global marketplace

KEY DISCUSSION AREAS

Group AKNOW THE BUSINESS & IMPACT OF

REGULATORY REGIMES

E-Commerce: Tips For Indian Businesses To Get The E-Commerce Edge And Manage Regulation

India’s Insolvency & Bankruptcy Code: Its Impact On Business Risks And Opportunities

Governance In The Financial Sector: A Case Study Examining The Kingfisher Airlines And ICICI Cases – Whose Rights Are Being Regulated And Protected?

Digital Health & Pharma: Latest Sector Developments For Businesses

The Regulation Of Ethics And Culture: Reputational Risks For Businesses

Valuing The Environment: The Regulation Of Corporate Development In India

Business, Human Rights And Slavery: How To Manage Social Issues

International Global Trade – Is There Life In Trade Agreements Like The TPP, Who Do They Benefit Or Is It Every Country For Themselves?

Personal Data Protection, The EU GDPR And Privacy Rights: A Review Of State And Personal Rights In India

Cryptocurrencies, Blockchain And Smart Contracts: The New Financial Contracting Model Or A Risky Path For Hiding Your Suspicious Transactions?

Employee Rights In Turbulent Times: Do Companies Value Whistleblowers?

Corporate Investigations: The New Paradigm - A Case Study On The Role Of Human And Artificial Intelligence

Artificial Intelligence For Businesses And Lawyers: The Benefits, Risks And Impact On M&A Deals

Mergers And Acquisitions In Asia: A Mini-Global Arena?

Anti-Corruption And Money-Laundering Risks: A Regional Enforcement Update For India-Focused Business

Criminal Liability For Companies And Individuals: The Impact Of The Prevention Of Corruption (Amendment) Act 2018 On Ethics And Compliance

Arbitration For Indian Businesses: A Review Of The Latest Legal Reforms And How To Manage Allegations Of Criminal Conduct Made In Arbitrations

Corporate Counsel: On Course Or New Challenges To 2020

Market Power And Competition: The Risks Of Dominance And The Rights For Smaller Businesses Squeezed By Dominant Players

Case Study - Cross-Border Investigations And Prosecutions: How To Navigate A Criminal Minefield?

The #MeToo Movement: Risks For Businesses And How To Respond

Tax Havens: Can They Survive And Are They Good For Business?

Group B UNDERSTAND LATEST GLOBAL LAWS, TRENDS & DEVELOPMENTS - FROM

GLOBAL EXPERTS

Group CKNOW THE STRATEGIES FOR

CRITICAL RISKS

PLENARY SESSIONS Globalization for Business & Lawyers: Regulatory and Reputation Risks in a Nationalistic Global Marketplace General Counsel: Hot Topics and Managing Corporate and Individual Risks Foreign Investment: Is India Open for Business? The Role of Lawyers as Intermediaries: Obligations and Social Responsibilities

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For More Information Please Contact

Jinal Chheda |+91-8879634922 | [email protected] Singh |+91-8879635570 | [email protected]

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“[W]hen equality is given to unequal things, the resultant will be unequal” – Plato, Laws

Deconstructing The Binani Cements/Rajputana NClaT

Judgment: Discrimination Between Creditors, and Maximization Of Value


While the substance over process approach taken

by the NCLAT in relation to UltraTech’s bid may be beneficial from a straight-

jacketed procedural approach in a CIRP, the conclusion in relation to no discrimination

between sets of financial creditors and operational

creditors may be problematic

Associate, J. Sagar AssociatesPartner, J. Sagar Associates

Neelasha NemaniTirthankar Datta

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Zoom In


The saga beginsBeing one of the key non-performing assets in the banking system, on July 25, 2017, the National Company Law Tribunal, Kolkata Bench (“NCLT”), had admitted an application filed by a financial creditor to Binani Cements Limited (“Binani”) for the initiation of a corporate insolvency resolution process (“CIRP”) under the Insolvency and Bankruptcy Code, 2016 (“IBC”).

Subsequently, resolution plans were received by the resolution professional (“RP”) from several resolution applicants, including Dalmia Bharat-led Rajputana Properties Private Limited (“Rajputana”) and Aditya Birla group company, UltraTech Cement Limited (“UltraTech”).

Based on the evaluation matrix, the resolution plan submitted by Rajputana was approved by the COC and the RP approached the NCLT for approval in accordance with the IBC. In the meantime, UltraTech had submitted a revised bid to the RP after expiry of the prescribed deadline, which was not considered by the COC. UltraTech also entered into negotiations with Binani Industries Limited (“Binani Industries”) to acquire Binani Industries’ stake in Binani for the same value as its revised bid amount, subject to the parties to the CIRP entering into a settlement.

Impugned NCLT orderWhile rejecting Rajputana’s plan, the NCLT vide its order dated May 2, 2018 held that the plan was discriminatory and was contrary to the scheme of the IBC and that the revised plan submitted by UltraTech should be considered by the COC. Subsequently, the COC on May 28, 2018 approved the revised plan submitted by UltraTech unanimously.

Aggrieved by the orders passed by the NCLT, multiple appeals (including by Rajputana) were filed before the National Company Law Appellate Tribunal (“NCLAT”), which were deliberated and disposed of together.

NCLAT: Backdrop of IBC objectivesThe NCLAT in its judgment dated November 14, 2018 dealt with two primary issues: (a) the rejection of Rajputana’s resolution plan, and (b) the consideration of UltraTech’s resolution plan.

It held that the objective of the IBC is for insolvency resolution in a time-bound manner for maximization of value of assets of the corporate debtor, to promote entrepreneurship, availability of credit, and balance the interests of all stakeholders. The NCLAT stressed that the objective of the IBC was to maximize the value of the assets of the corporate debtor and thereby for all creditors and not for a stakeholder or a set of stakeholders. In light of the above objectives, the NCLAT held that the operational creditors must get at least similar treatment as compared to the financial creditors.

Rajputana plan and creditor discrimination The NCLAT noted that while certain financial creditors were being provided with 100% of their verified claim, other financial creditors were taking significant haircuts. The rationale provided for this discrimination was that certain financial creditors had direct exposure to Binani, whereas some others were beneficiaries of corporate guarantees by Binani. The plan also discriminated between all such beneficiaries of corporate guarantees for various reasons.

Similarly, the NCLAT also noted that insofar as the operational creditors of Binani are concerned, while unrelated parties were taking a massive haircut, related parties were not provided with any amount of their verified claim.

Relying on the NCLAT judgment in Central Bank of India v. Sirpur Paper Mills Limited, it reiterated that any such discrimination would be illegal and against the spirit of the IBC. The NCLAT held that the IBC does not prescribe differential treatment between two sets of creditors who are similarly situated, such as financial creditors or operational creditors.

Relying on the NCLAT judgment

in Central Bank of India v. Sirpur

Paper Mills Limited, it reiterated that any such

discrimination would be illegal and against the spirit

of the IBC. The NCLAT held that the IBC does

not prescribe differential treatment between two

sets of creditors who are similarly situated such

as financial creditors or operational creditors

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Disclaimer – All views expressed by the authors are personal.

In the larger scheme of things, it observed that if the operational creditors are ignored and provided merely with the liquidation value, no operational creditor would supply goods and services to a company on credit, which would severely impact the IBC’s object of promoting availability of credit. The NCLAT concluded that a discriminatory plan is against the basic object of maximization of the corporate debtor’s assets and balancing the interests of stakeholders.

UltraTech bid: Substance over processThe resolution plan submitted by Rajputana on March 7, 2018 was approved by the COC on March 14, 2018. Despite the fact that UltraTech had submitted its revised (and higher) bid on March 8, 2018 (before the approval of the Rajputana plan), the same was not considered by the COC. As per the NCLT order, since UltraTech had submitted its first bid within the time stipulated by the RP in the invitation, the submission of a revised bid after such date is considered to be in continuance of the resolution plan already submitted by UltraTech and accepted by the RP. Further, it is pertinent to note that UltraTech’s plan had provided for payment of 100% of the verified claims of the financial and operational creditors, except related parties.

The NCLAT held that the objective of maximization of value of the corporate debtor’s assets would necessitate finding a resolution applicant who can offer the maximum amount so as to safeguard the interest of all stakeholders of the corporate debtor, which was ignored by the COC.

The NCLAT held that all resolution plans which meet the requirements of Section 30(2) of the IBC are required to be tabled by the RP before the COC for its consideration, and the COC is entitled to negotiate and modify any resolution plan with the consent of such resolution applicant anytime within the 180/270-day period. Therefore, given that the RP did not present UltraTech’s plan before the COC for its approval even though the plan was in compliance with Section 30(2) of the IBC, the NCLAT held that the non-consideration of UltraTech’s bid was in flagrant violation of the object of maximization of the value of the assets of the corporate debtor and failing to safeguard the interests of all stakeholders.

Perhaps the most significant of the chain of events is that Binani Industries moved the Supreme Court with the intent to deposit certain amounts by transferring its stake in Binani to UltraTech. However, the NCLAT did not permit the parties to enter into a settlement since Binani Industries had not filed an application for settlement even after receipt of the requisite 90% approval of the COC. Since this deal between Binani Industries and UltraTech was struck after the resolution plan of Rajputana was approved by the COC, and after submission of the plan by UltraTech, the NCLAT held that UltraTech cannot be considered to be ineligible as a resolution applicant. Therefore, with a view to ensure

greater maximization of the value of the corporate debtor’s assets, the plan submitted by UltraTech was approved by the COC unanimously.

Analysis: Impact of the judgmentThe key takeaways from the Binani Cements / Rajputana Properties NCLAT order are as follows:

(a) Based on the principle of non-discrimination between a set of creditors, operational creditors and financial creditors would have to be treated in the same manner. It appears that the haircut which is being offered to the financial creditors would also need to be offered to the operational creditors. Additionally, as a corollary of the judgment, even secured creditors and unsecured creditors may have to be treated in the same manner. However, commercially treating financial and operational creditors or even secured and unsecured creditors on the same footing may not be advisable as each creditor would add a different value to the corporate debtor. This would render the security provided to a lender and the value of such security irrelevant in a CIRP. Additionally, while Sirpur Paper Mills criticizes plans offering liquidation value to operational creditors only, the NCLAT order ignores Section 30(2)(b) of the IBC which provides for at least the liquidation value to be paid to operational creditors.

(b) The substance of the resolution plan and whether it maximizes the value of the corporate debtor and balances the interests of all stakeholders would be given primacy to any procedure which may be prescribed by the RP. In fact, UltraTech’s revised bid was an email and was not strictly as per the process document prescribed by the RP. Even though the COC was negotiating with the highest bidder and had approved Rajputana’s plan, a subsequent eligible resolution plan was approved by the NCLT on the basis of the process document, providing the COC the power to accept or reject any plans prior to approval of the same by the NCLT. While this affirms the fundamental principle of COC-autonomy which underlies the scheme of the IBC, the impact may be that the sanctity of the prescribed process may be defeated at any time prior to NCLT’s approval of the resolution plan, by a higher bidder.

Accordingly, while the substance over process approach taken by the NCLAT in relation to UltraTech’s bid may be beneficial from a straight-jacketed procedural approach in a CIRP, the conclusion in relation to no discrimination between sets of financial creditors and operational creditors may be problematic. This may tilt the balance of the CIRP from being a financial creditor-driven process towards operational creditors.

Singapore’s New Accredited Investor Regime

Since 8 October 2018, many within the financial services industry have been struggling to

understand the finer aspects of the new regime, recalibrate their client on-boarding policies and

procedures to account for the new requirements, and hopefully have the entire effort completed

on or before 8 January 2019

InsIghts

Singapore’S new accredited inveStor regime


InsIghts


LL.B. (Hons); LL.M.Partner, Shook Lin & Bok LLP, Singapore

Eric Chan

The regulatory landscape in Singapore is undergoing a significant change in terms of the way sophisticated investors are being defined. This is happening in phases, with the key milestone dates being 8 October 2018 and

8 January 2019. While the changes were not in themselves unanticipated, nevertheless, some of the details did take many financial institutions by surprise.

The changes relate to the term “accredited investors” as used in Singapore’s Securities and Futures Act (“SFA”) and in the Financial Advisers Act (“FAA”). Together, these two laws establish the overall framework under which the Monetary Authority of Singapore (“MAS”) regulates the capital markets industry in Singapore.

The term “accredited investor”, together with the term “institutional investor”, is employed largely within the SFA and FAA to refer to persons (corporate or individuals) of some degree of sophistication in matters of investments (as distinct from retail investors) and who thus require lesser protection from the regulatory regime. The term “institutional investor” refers largely to financial institutions and sophisticated investment organizations and will not be discussed in this article.

Under the SFA and FAA, a financial institution is generally subjected to a lighter regulatory burden when the person it is serving is an accredited investor. In return, such an investor generally gains access to a wider range of financial products or services, including more risky products that would be inappropriate for the risk profile of a retail investor.

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Prior to 8 October 2018, the term “accredited investor” was defined purely in terms of how much net assets or net income a person had – the presumption being that wealth or income is a good proxy of one’s level of investment sophistication. Thus, in the version of the SFA existing before 8 October 2018, an accredited investor was, in the main, either:

(a) an individual with net personal assets of more than SGD 2 million or an income over the preceding 12 months of not less than SGD 300,000; or

(b) a corporation with net assets of more than SGD 10 million.

By subsidiary legislation, several additional categories were added, although the approach remained the same. Thus, a person can be classified as an accredited investor simply by virtue of that person having the requisite level of asset or income. It was not necessary for the person to choose to be an accredited investor. Indeed, at many instances, such a person might not even be aware that his financial institution has categorized him as an accredited investor.

In the first phase of reforms, starting from 8 October 2018, the asset/income criteria in relation to individuals have been tightened in one respect and loosened in another. A new restriction has been added – the value of an individual’s primary residence can count for only up to SGD 1 million, when determining whether he has the requisite SGD 2 million in net personal assets. This is intended to address a prevalent feature within Singapore society where individuals tend to concentrate their asset holdings into their personal residence. At the same time, there is liberalization in the form of a new alternative criterion for eligibility – an individual will qualify if he has more than SGD 1 million held (net of liabilities) within a bank deposit or an investment product. This new criterion makes things simpler for a financial institution which can more readily assess qualification by reference only to the net amount of investments that a client parks with it.

More significantly, in the second phase starting on 8 January 2019, in certain specified scenarios, a person who meets the revised asset/income criteria will not automatically become an accredited investor. Such a person must additionally give consent to be treated as an accredited investor. In other words, he must “opt-in”. The process by which an eligible person opts-in to be an accredited investor is spelled out in a new set of regulations – the Securities and Futures (Classes of Investors) Regulations (“SFCOIR”).

In summary, in those scenarios where opt-in is required (the scenarios themselves being itemized within the SFCOIR), the process is as follows:

(a) the party required to procure opt-in (which is referred to in the SFCOIR as a counterparty and which will typically be a financial institution) must inform the eligible person that he/it has been assessed to be eligible to be an accredited investor;

(b) the counterparty should invite the eligible person to give consent to be an accredited investor, and in so doing, the counterparty must highlight and explain (in simple language) certain provisions of the SFA and FAA (referred to in the SFCOIR as the consent provisions and which are itemized within the SFCOIR). These consent provisions are the provisions which will impact the eligible person as an accredited investor;

(c) the counterparty must administer a warning (in a format prescribed in the SFCOIR) to the eligible person; and

(d) the counterparty must also make clear to the eligible person that having consented to be an accredited investor for the purpose of the consent provisions, such consent can be withdrawn at any time.

Once all the above steps are taken and the consent is in place, the counterparty can then treat the eligible person as an accredited investor.

As mentioned, the requirement to procure opt-in is mandatory only in certain scenarios specified within the SFCOIR. These largely cover:(a) investor compensation under a fidelity fund

administered by an exchange;(b) offering of securities and units in collective investment

schemes without an accompanying prospectus;(c) client money and client assets handling rules applicable

From a policy point of view, the new regime plainly makes a lot of sense. It helps ensure

that investors enter into investment transactions

with a greater degree of informed consent. This in turn

will reduce the risk of disputes arising, particularly where the client alleges that the financial institution

had induced him to enter into transactions which were not suitable

for him or which he did not fully understand. Unfortunately, the

downside to the new regime is that it enormously complicates the client

on-boarding process that financial institutions must undertake

InsIghts


Disclaimer – The views expressed in this article are the personal views of the author and are purely informative in nature.

Note - Since the time of writing, the MAS has indicated that it will consider pushing back the commencement of the second phase from 8 January 2019 to 8 April 2019. If implemented, this will give financial institutions a small albeit temporary reprieve.

to capital market intermediaries;(d) staff supervision rules for capital market intermediaries;

and(e) certain business conduct requirements for capital

market intermediaries.

The new opt-in requirement fundamentally changes the way financial institutions in Singapore on-board their clients.

While it was certainly possible in the past for a financial institution to document a client’s qualification to be an accredited investor without interacting with or informing the client, under the new regime, the financial institution must not only inform the client that he is going to be treated as an accredited investor but also ensure that the client understands the implications of being an accredited investor and agrees to be so treated.

From a policy point of view, the new regime plainly makes a lot of sense. It helps ensure that investors enter into investment transactions with a greater degree of informed consent. This in turn will reduce the risk of disputes arising, particularly where the client alleges that the financial institution had induced him to enter into transactions which were not suitable for him or which he did not fully understand.

Unfortunately, the downside to the new regime is that it enormously complicates the client on-boarding process that financial institutions must undertake.

First of all, as mentioned, the opt-in process is not being instituted on an across-the-board basis under the SFA, but is instead required in certain specified SFA scenarios. In each SFA scenario where opt-in is required, the SFCOIR will specify the counterparty who must procure opt-in. Because opt-in is both scenario-specific and counterparty-specific, it is conceivable that in a particular context, there may be more than one counterparty required by law to procure opt-in from the same eligible person. This is so because the SFCOIR specifically says that an eligible person can opt to be treated as an accredited investor vis-à-vis one counterparty but not vis-à-vis another.

Let us take a common scenario – where shares in a company are offered to investors in Singapore without an accompanying prospectus, under Section 275 of the SFA. Under this provision, a prospectus is not required if the shares are only offered to accredited investors and certain similar categories of sophisticated persons. Under the SFCOIR, an offering under Section 275 is one of those scenarios where opt-in must be procured by the offeror of the shares. Thus, the company issuing the shares (who would typically be the offeror) must follow the opt-in process stipulated in the SFCOIR before it can issue shares

to the offeree. However, it is possible that the investor in such a circumstance is acquiring shares from more than one source (for instance, by direct subscription application to the issuer and also from a placement agent). If so, there could be more than one offeror interacting with the same offeree. Yet it is also clear from the SFCOIR that each offeror has its own duty to procure opt-in from the offeree.

To take a slightly different scenario – in private banking, it is common for the bank to introduce its high net worth clients to opportunities to invest in non-retail funds (which would not be open to retail clients). However, the fact that the client has consented to be treated by his bank as an accredited investor does not exempt the fund manager of such a non-retail fund from having to procure opt-in from the bank’s client before it is able to sell fund units to the bank’s client.

The result is that there may be a flurry of notifications and consent forms flying about between the investor on one side and the issuer and financial intermediaries on the other side. This adds to the already heavy burden placed on issuers and financial intermediaries.

Another complication is that the set of SFA-regulated scenarios where opt-in must be procured is not identical to the set of so-called consent provisions that must be explained to the eligible person as part of the opt-in process. Presumably, this is because the SFA is a massively complex piece of legislation, and it did not follow that opting-in is required in all situations where the words “accredited investor” appear within the legislation.

By comparison, the opt-in regime as applied to financial advisory services (which MAS also regulates but under the FAA instead of the SFA) is simpler. Under the FAA framework, starting from 8 January 2019, all references to the term “accredited investor” are references to a person who is eligible and has opted in to be an accredited investor.

The overall result is that since 8 October 2018, many within the financial services industry have been struggling to understand the finer aspects of the new regime, recalibrate their client on-boarding policies and procedures to account for the new requirements, and hopefully have the entire effort completed on or before 8 January 2019.

Even after 8 January 2019, it remains to be seen what sorts of teething problems are going to arise, especially in financial institutions whose business models are geared towards serving the very large segment of non-retail clients in Singapore.

Interesting times are ahead for regulatory compliance professionals in Singapore.

Leader Speak


Leader Speak


Proven Merit Should Be the ConSideration,

equally aPPliCaBle For

The Bench And The BAr

Chandhiok

legal era Magazine in conversation with

amarjit Singh

President, inSol india

Leader Speak


LE: You have risen very high in your domain and have even been called the “King of the Delhi High Court” apart from being named among India’s top legal luminaries. Has it been quite a struggle?I would not say it has been a struggle. I tried to do my job with enthusiasm, passion, and dedication, with a keen spirit of learning and keeping in view the service the profession demands.

LE: The media has often written about how meeting late Justice R.S. Narula, a legend of law, made you enter law as your chosen vocation. Please elaborate.I had the occasion to see Narula Saheb handling a family-related matter. The way he handled difficult situations and complex questions of law coupled with his analytical approach made a great impact on me. Above all, his scholarship astonished me. He was the one who deeply influenced me to make my choice. I also had the occasion to brief him, and on every occasion, I learned something new.

LE: What would be your advice to young graduates at crossroads whether to enter litigation or the corporate world? Litigation has the benefit of public exposure and the ensuing popularity. It sharpens the mind and intellect, broadens the vision, and helps one in many ways. It is competitive learning as well. In a corporate job, the picture may be different, but experience of litigation certainly helps.

LE: What qualities have helped you reach where you are today? Simply put, the quest to learn, respect for equality, and human dignity. And then, being modest and ever willing to be further instructed.

LE: Hasn’t making a mark in such a high-pressure profession come with its fair share of personal and familial challenges? Also, is work-life balance a misnomer, given the challenging nature of your work?This is common to all professions. Lawyers are at much ease to plan and work. It depends upon how one takes it. Proper time management and prioritization will help a lot. The problem comes when you want to do all the things in the snap of a finger. In every field, understanding of work and the people around matters. Then comes constant and careful practice. My family well understood my long hours at work, but I have been able to manage time for them as well. It depends upon how you plan your time.

LE: What would you say have been the highlights of your career?Nothing specific. For the sake of record, I may say my

appointment as the Additional Solicitor General and as Principal Counsel of the European Union Commission.

LE: Do you feel that the legal profession has changed significantly over the years? Yes. As time rolls, changes will be there in every field. As new laws and forums are being created, the consequential changes in practice will be there. They are inevitable. We live in a world where knowledge is continuously exploding. The legal profession has substantially met challenges of the time.

LE: There must have been cases in your career which left an indelible imprint on you. Could you please take us through some such? For me, as a lawyer, every brief is of the utmost importance. Then there were cases of public importance, where you handle a brief of that nature or be an amicus. Rendering proper assistance to the court is a matter of great satisfaction. For example, once I had to deal with the food supplied in Rajdhani trains. On enquiry, I found that the food was of pathetic quality. The report went like that. And that resulted in some changes then!

LE: You’ve had an excellent academic record. Do you believe that excellent academics almost always leads to success in one’s career? Good academics certainly gives one an edge over others, when it comes to competition. However, difference of a few marks may make one lose being a topper in the University, yet he/she can be the best in the profession for his/her caliber or capacity does not depend merely on the marks. There are instances where students who have done averagely well have far excelled as compared to those who were distinction holders. In the profession of law, any law graduate who can read and understand the subject matter of the brief, digest the same, cull out the issues, apply the relevant law well, and present the same ought to succeed. I think that should hold good for any other profession too.

LE: Has legal education in India kept in step with the changes in the legal profession? Unfortunately not, if we view all the institutions together. We need more qualitatively good teachers and academicians who will earn and command respect. The Bar Council of India needs to prescribe one law curriculum for both five-year and three-year courses. Economic law is the need of the hour, and with changing times, legal education must focus on it more, besides teaching students the art of negotiations and resolution. Justice and Rule of Law are perhaps two of the noblest concepts invented by the wit of man. Conflicts in the Society are increasing day by day. Therefore, teaching students the value of ‘resolution’ is imperative.

LE: What are the qualities and skills one needs to be successful in the legal profession?

Leader Speak

Good knowledge of law, good general knowledge, a great deal of common sense, good capacity to understand and analyze, and then present the case. Of course, these have to be coupled with honesty, integrity, sense of purpose, and justice. Of course, the virtue of humility adds value.

LE: Any anecdotes you’d like to share with us about the very first case/matter you handled and your very first court hearing?Two-three months old in the profession, I was required to mention a matter before the Hon’ble Chief Justice for urgent hearing. I tried my best to memorize every possible sentence. However, when I stood before him, I went totally blank except ‘My Lords’ and could say nothing more. Then, Hon’ble Chief Justice Andley, looking at the bunch of papers in my hand, asked whether I had an urgent matter. His Lordship also asked me if I knew the facts of the case. I just gave three or four facts and dates and the issue involved in the matter. His Lordship observed: “If the roster of the case was with this Bench, I would not let your senior argue and only hear you”. These were encouraging words that induced confidence.

Few years in the profession, I was making a point of law but the Hon’ble Judge was getting annoyed at me when a senior member of the Bar sitting behind came to my rescue and made the submission, on which notice was issued. Years later, I was confronted with the same situation, when an Hon’ble Judge was getting annoyed at a youngster. I got up from behind and went to assist the Court. The Hon’ble Judge was upset and wanted to issue a notice of contempt. Then I told him that I learned that from none else but his own father, who came to my rescue in a similar situation! Another occasion is when the Hon’ble Judge, in the midst of arguments, gave me parts of journals to study and come back to argue!

I come from a business family and I am the first professional in the family. Destiny and inspiration, as I said earlier, brought me here. Once I joined the profession, there has been no looking back. It looks like the almighty bestowed on me only one career – that of a lawyer – and that has come true.

LE: You’ve spent more than four decades in this profession. What are the key takeaways?Just one thing – my learning which is an everlasting asset for me.

LE: If given an opportunity, what would you do differently in your career so far? No idea. I thought of only one career - that of a lawyer. And that became true.

LE: On what parameters do you choose your matters?There are no specific parameters; yet, I do see if the person and/or body corporate itself has been responsible for the cause or the claim. I impartially look at the problem brought by my client and then see how best I can help solve the same.


Leader Speak


Further, I make an endeavour whether the dispute can be amicably resolved using mediation and conciliation.

LE: You held the post of Principal Counsel to the European Union Commission from August 2013 to March 2016. You remain the only Indian lawyer to have held this position. Please elaborate.It was an honour for me and my country to be appointed the EUC’s Principal Counsel. EU found me fit and bestowed this honor on me. I am sure there were many eminent persons in this country before me and even today who deserve this position. I had the honor to address the General Assembly of United Nations to get the resolution passed that European Union Commission is vested with jurisdiction to summon anyone, if relevant, including the Revered Pope.

LE: Please brief us about your journey as part of INSOL India and now its President.INSOL India got registered sometime in 1997-98 when insolvency resolution in relation to the corporate entities was not in existence. Many Committees were constituted, which made their recommendations, but at no time, the Government

thought of enacting Insolvency and Bankruptcy law. For 20 long years, we continued our endeavor to

look at principles of insolvency from other parts of the world, held workshops and conferences on insolvency. It is a privilege

to be President of INSOL India, which has twenty years of thought leadership in insolvency; no other organization in this country has the same credentials. With the Insolvency and Bankruptcy Code, 2016

coming into force, insolvency has changed the professional careers of many; brought a new professional entity called

‘Resolution Professional.’ All stakeholders are

working to ensure implementation of the Code. It adds to my responsibility to ensure that INSOL India moves to greater heights. The

recent conference at Leela Hotel, New Delhi,

was attended by delegates from all over the country, with

speakers from abroad as well. Government, Regulator, Court, and professionals were represented and the debates were quite encouraging.

LE: Please tell us more about your responsibility as President of Council


Leader Speak


to the Regulations by the IBBI and two amendments to the Code. This shows that whenever inadequacy is found, Parliament or the Regulator takes immediate steps. Effective implementation of the Code will lead business and commerce moving in a healthy terrain. There are no loopholes as such in the Code. They are being invented by interpretation, which can be plugged statutorily as well as procedurally.

LE: As a Senior Advocate having been practicing for long in Indian High Courts and the Supreme Court, what has your experience been like? My experience has been an enriching one. In spite of all odds, the profession is a highly respectable one, provided you treat and touch it with respect and devotion. One always desires to rise to eminence. Law is both a science and an art, and the experience has been to learn both with clarity. In the midst of animated and often complicated and complex questions, appropriate principles and their legal value have to be brought out within a given time. The experience has provided me with a sense of duty and service as well.

LE: You served as the President of the Delhi High Court Bar Association for a record six terms. Please take us through some of your memorable cases in this capacity.As the President of the Bar, two cases immediately come to my mind. One, where the jurisdiction of the Delhi High Court was enhanced by the Legislative Assembly of Delhi. A Bench of five judges was constituted to hear the matter filed by the Delhi High Court Bar Association and a judgment came accepting the contention of the Bar that the Delhi Legislative Assembly did not have the legislative competence to amend the Delhi High Court Act. The second one was with respect to the amendment of the Court Fee Act by Delhi Government. Many felt that the challenge would fail, but not only one succeeded in the challenge but the said judgment was one of the best constitutional judgments delivered by the Delhi High Court and found place in the Yale Constitutional Law Journal.

LE: You also served as Additional Solicitor General of India. Could you take us through the highlights of your tenure as ASG?I had the privilege to represent the Government both in the Hon’ble High Court of Delhi and then in the Hon’ble Supreme Court. I had an excellent time and learned a lot defending the largest litigator in the country, the Government of India. It was an enriching experience that made me learn how the Government understood the problems of the citizens and how it viewed the rights of the citizens qua the State. The diversity of litigation on behalf of the Government led me to learn many enactments, which came before my eyes for the first time. Each moment of the said position enriched my knowledge of law and the experience to handle more critical cases.

for Conflict Resolution-Maadhyam.Being the President of Council for Conflict Resolution-Maadhyam, I have the collective responsibility with all other office bearers, members, and the Board. I have an excellent team to work with. I am just one amongst them. Apart from the trained mediators and arbitration experts, we look at how mediation can be strengthened in the country. For many years we have been able to train a large number of Mediators. Many of them are doing pro bono work. Maadhyam looks at the capacity building of mediators. Maadhyam arranged a special course at Pepperdine University in June 2018 for mediators. Plans are on to start mediation clinics in various universities besides imparting more education about ADR and negotiations with an aim to ‘catch them young’. Mediation training programs have been started in universities as well as in schools.

LE: You’ve received a slew of awards in the course of your illustrious career. Are there any awards in particular that are closest to your heart?Yes, the Award given by then Prime Minister of India Dr. Manmohan Singh and the other by Bar Council of Delhi as the ‘Leader in the profession’ and ‘Leader in the Bar’, respectively.

LE: You were the Chairman of the Working Group under the Insolvency and Bankruptcy Board of India (IBBI). Could you please brief us about your role and responsibilities?I was. The Working Group had submitted its report to the Board and the Board, in turn, had submitted to the Government. Working Group was constituted to get inputs in relation to that part of the Code which dealt with individuals. The report is available on the website of IBBI. Individual insolvency/bankruptcy is on a totally different basis. Unlike corporate insolvency, individual insolvency thrusts upon the individual a social stigma. Hence, instead of restructuring, a probable repayment plan has to be devised. Stress on mediation and conciliation has been laid.

LE: How would you rate the effectiveness of the Insolvency and Bankruptcy Code till date? What in your opinion are the loopholes that need to be plugged to make it serve the purpose for which it was introduced?Effectiveness of any legislation is relatable to its implementation. Any new legislation ought to be adequate to meet the challenges of time. The Insolvency and Bankruptcy Code, 2016 is one of the best economic reforms brought out. The jurisprudence created under the Code has no parallel in the world and the special Tribunals constituted under the Code, namely, National Company Law Tribunal and National Company Law Appellate Tribunal, have ironed out many creases. In fact, the Hon’ble Supreme Court too has contributed its bit to strengthen the insolvency jurisprudence. Within two years, one has seen manifold amendments

Leader Speak


Father-son duo: Amarjit Singh Chandhiok (Right) and Karan (Left)

Amarjit Singh Chandhiok (Left) with his Wife Nomita (Right)Amarjit Singh Chandhiok (Center) with his Daughter in Law -

Sana (Left) and Daughter - Amrita (Right)

Amarjit Singh Chandhiok (Center) with his family: (L-R) Daughter in Law - Sana, Son - Karan, Daughter - Amrita, and

Wife – Nomita

Leader Speak


LE: Sometime ago, a Constitution Bench of the Supreme Court struck down the National Judicial Appointments Commission (Amendment) Act, restoring the collegium system of appointing judges to the higher judiciary. You had spoken in favor of the collegium system with some modifications. Please elaborate.As a total change of the system is not immediately possible, I would suggest continuation of the collegium system with modifications to make it more transparent and effective. Any system that works with transparency and the intended efficiency will give result. It can evolve. Proven merit should be the consideration, equally applicable for the Bench and the Bar. Mere intentions or plans will not work.

LE: Do you think the Fugitive Economic Offenders’ Bill will help bring to book absconding loan defaulters the likes of Vijay Mallya, Mehul Choksi, and Nirav Modi? Please substantiate your reply. As the matters are subjudice, it would not be appropriate for me to make comments. As I mentioned above, any legislation’s success depends upon its implementation. Mistakes of ages cannot be cured over a single night. Externment proceedings over the years have not borne any fruitful results. One wonders what would happen in these cases. The success to get one recent extradition may lend some strength that others should follow. The law with respect to fugitive economic offenders has been made especially after these three instances have happened. Whether the law would have retrospective effect itself is a question mark.

Every brief is of the utmost

importance... I make an endeavour whether

the dispute can be amicably resolved

using mediation and conciliation

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Cross-Border M&A:

CriticalAspects

Cross-border mergers and acquisitions have emerged as a way to rapid expansion and global trends point to increasing deal volume

Let's UphoLd


Executive Director & Chief Financial Officer KEYS Hotels

(Berggruen Hotels Pvt. Ltd)

Vikas Chadha

Cross-border M&As are defined as M&As that involve an acquirer firm and a target firm whose headquarters are located in different home countries. Cross-border mergers and acquisitions (M&As) have emerged as a way to quickly gain

access to new markets and customers, and global trends point to increasing deal volume. These are deals between foreign companies and domestic firms in the target country. The trend of increasing cross-border M&A has accelerated with the globalization of the world economy.

Top strategic deal objectives Some benefits which companies derive out of cross-border M&A are around the following objectives:

1. Portfolio diversification

2. Favorable regulatory environment in the target

3. Improving cost synergies

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4. Get scale of operations and related efficiencies

5. Acquiring intellectual property and technology

6. Get access to new talent pool

7. Ability to add and enhance the distribution network

8. Get new production capacity

9. Get new product technology

10. Overall geographic growth

M&A requires a comprehensive due diligence process, and legal and integration risks are primarily on the mind while deciding valuations or a go – no go for the deal.

Top risk factors for cross-border M&A1. Risk on taxes and tax laws

2. Regulatory risks

3. Political risks

4. HR-related risks on integration including culture and talent

5. Overall business risk

6. Due diligence risk

Importance of due diligence Due diligence is the process of evaluating a business situation diligently from various aspects before arriving at a decision. In a transaction scenario, due diligence helps a buyer in uncovering potential liabilities and discrepancies and thus enables the buyer to take an informed decision. There are various forms of due diligence depending upon the area/scope of coverage like financial due diligence, legal due diligence, commercial due diligence, and tax due diligence. Other diligences may be performed in areas such as IT and human resources.

Some advantages from due diligenceRecapture of past losses upon change in shareholding:

Under the Indian tax regime, change in shareholding of a closely held company by more than 49% hampers its ability to carry forward unabsorbed tax losses (excluding depreciation) which were otherwise eligible to be carried forward for eight years. While conducting due diligence, it needs to assess whether there has been any change in the shareholding of the target in the past which has impaired its ability to carry forward the unabsorbed losses.

Claim of tax holiday/incentives (Section 10AA, 80IA, etc.):

Under the Indian tax regime, tax holidays/incentives can be availed for a specified period subject to the fulfillment of specified conditions. It is necessary to assess whether or not the conditions prescribed for availing a tax holiday have been complied with by the target company, the correctness of such a tax holiday claim, and the unexpired period for which the tax holiday can be claimed by the buyer so that the buyer can factor the same in valuation.

Deemed dividend

Under the Indian tax regime, a loan by a closely held company to its shareholder/allied entities may be re-characterized as deemed dividend in the hands of the recipient triggering withholding tax liability on the target company. Thus, the aspect of advancement of loans to shareholder/allied entities needs to be examined during the due diligence exercise.

Withholding tax and recoverability of tax refunds/credits:

India also has a very comprehensive withholding tax regime which casts an obligation on the payer company to withhold taxes on specified payments to non-residents and on payments to residents which are chargeable to tax. Sample checks of withholding tax compliances help in identifying inconsistencies in withholding tax filings/compliances of the target company. Tax due diligence helps the buyer in ascertaining the quality and recoverability of tax refunds/tax credits like MAT credit being claimed as eligible to be carried forward by the target company.

Understand the indirect tax liability on goods/services Highlight corporate legal and regulatory considerations:

Enterprise-level, country-specific legal and regulatory issues involve specific expertise and often mandate long lead times. Three types of issues are common: labor issues, minority investment issues, and anti-trust and tax issues.

Understanding product registration and industry-specific regulations:

Extensive due diligence is essential to understanding industry-relevant product registration, certification, and labeling requirements in highly regulated industries including life sciences and healthcare, chemical and consumer goods, and financial services.

Legal entity (LE) rationalization:

Large integrations often result in overly complex LE structures that are misaligned with corporate strategy and drive up administrative costs. Three common areas of concern are structure simplification, registration and licensing, and local engagement.

Key regulatory aspects in an M&A dealInbound Merger:

Prior approval from R.B.I. is mandatory; Section 234(2) of the Companies Act, 2013 states that a foreign company may merge with a company registered under this Act or vice-versa. However, such a merger requires prior approval of the Reserve Bank of India. The scheme of merger may inter alia provide for payment of consideration in Cash or in Depository Receipt or a combination of the two. For the purpose of this sub-section, the expression

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“Foreign Company” means any company or body corporate incorporated outside India whether having a place of business in India or not.

Valuations:

In case of outbound merger, the foreign company should ensure that its valuation is conducted by a valuator who must be a member of a recognized professional body in their country and such valuation must be in accordance with internationally accepted principles on accounting and valuation. A declaration to this effect is required to be attached with the application for obtaining R.B.I approval in outbound merger, but the law remains silent on such requirement for an inbound merger.

Fast Track Merger:

Section 233 of the Companies Act, 2013 introduces the globally accepted concept of ‘Fast Track Merger Process’ which introduces a slightly simpler procedure for mergers and amalgamations of certain companies including small companies as well as holding and their wholly-owned subsidiary companies. Provisions under the Companies Act, 1956 which deal with traditional mergers and amalgamations are time-consuming and costly processes as they include clearances from many regulatory bodies and every type of company must go through this route. There was a need to simplify and expedite the procedure for the merger of small companies, holding subsidiary companies, and companies where the interest of third parties is not involved. The present Act enables these companies to undergo merger and amalgamation procedures quickly, simply, and within fixed time duration. Cross-border mergers are also regulated by the R.B.I under the Foreign Exchange Management Act, 1999 (FEMA).

Outbound Merger:

In case of outbound mergers where the resultant company is a foreign company: The acquisition and holding of securities in the resultant company by an Indian resident shall be in accordance with the Foreign Exchange Management (Transfer or Issue of Foreign Security) Regulation, 2000 or the provisions of the Liberalized Remittance Scheme as applicable. The resultant foreign company shall be liable to repay outstanding or impending borrowings as per the scheme sanctioned by NCLT as per the terms of the Companies (Compromise, Arrangement or Amalgamation) Rules, 2016. The resultant foreign company can acquire, hold any assets in India, or transfer any such assets as per the permissible limits under the provisions of the FEMA. In case of both inbound and outbound mergers, if such assets or

securities acquired or held by the resultant company are in contravention of the provision of FEMA, the resultant company shall sell such assets or securities within a period of 180 days from the date of sanction of the cross-border merger scheme and the sale proceeds to be repatriated to India or outside India as the case may be immediately through banking channels.

Reporting requirements:

The Indian entity is required to furnish the prescribed information electronically to tax authorities within 90 days from the end of the financial year in which transfer of the share/interest takes place. Where the transaction has the effect of directly or indirectly transferring the rights of management or control in relation to the Indian concern, the information shall be furnished within 90 days from the date of the transaction. Further, Indian concern shall be required to maintain certain documentation in relation to the transaction for a period of not less than 8 years from the end of the relevant assessment year in which the transaction takes place.

Some examples of M&A:

More than $2.5 trillion in mergers were announced during the first half of this year. Four of the 10 biggest deals were struck to fend off competition from the largest technology companies. The value of acquisitions announced during the first six months of the year increased by 61 percent from the same period in 2017, according to data compiled by Thomson Reuters. That has put mergers in 2018 on pace to surpass $5 trillion. In the United States, interest rates remain low, corporate earnings are ballooning thanks in part to tax cuts, and stock prices remain near historic highs. In this environment, companies have turned to mergers and acquisitions for growth, trying to grab market share and reinvent their business models, especially as Amazon, Netflix, and other tech companies increasingly push into new industries. AT&T’s $85.4 billion acquisition of Time Warner removed some of the regulatory uncertainty around blockbuster mergers and could touch off more deals. Comcast waited just a day after the judge’s ruling before challenging Disney’s existing bid with its own offer. The pharmacy chain CVS Health announced a $69 billion merger with the health insurer Aetna late last year, and in March, another health insurer, Cigna, announced a $52 billion deal for Express Scripts. Competition with Amazon also drove one of the biggest overseas acquisitions by an American company so far this year: Walmart’s $16 billion deal for a majority stake in Flipkart, India’s leading e-commerce platform.

Viewpoint


Is it fair for the Government, as a stakeholder in India’s largest cigarette company, to advise banning a product without even considering the views prevailing in other jurisdictions and

the reasons why they have regulated and allowed sale of ENDS?

Is The Ban OnENDS Healthy?

Viewpoint


The recent Advisory (dated 28.08.2018) issued by the Ministry of Health and Family Welfare to ban Electronic Nicotine Delivery System (ENDS), including e-cigarettes, in a market which is flooded with conventional tobacco cigarettes

and other tobacco and nicotine-based products raises many questions on public health.

Firstly, has the government turned a blind eye towards consumption of tobacco? Nothing has been done to ban conventional cigarettes outright, whereas various state governments have already banned ENDS. Does this mean that the government considers cigarettes a healthier, more acceptable option?

Secondly, has the government fairly assessed the evidence of comparative harm of ENDS vis-à-vis conventional cigarettes as well as the consequences of banning ENDS while still permitting conventional cigarettes?

ENDS works by heating a solution of water, flavouring, propylene glycol, vegetable glycerine, and typically, nicotine to create a vapour that the user inhales. The device tends to consist of a mouthpiece, a battery-powered heating element, a cartridge or refillable tank containing the liquid solution, and an atomizer that vaporizes the solution when heated.

ENDS is becoming an increasingly popular choice amongst smokers. As seen in the classic case of UBER and other ride-sharing apps, consumer choice has always driven the market. Such disruptive products remain immensely popular even though they continue to face opposition from the traditional lobby and regulatory hurdles from the government.

ENDS does not contain tar and carbon monoxide of conventional cigarettes; these are the most harmful by-products produced when smoking conventional cigarettes. This is a clear advantage of ENDS over conventional cigarettes. That said, some potentially harmful components are present in both products.

Globally, ENDS is considered significantly less harmful than conventional cigarettes. Though nicotine delivered through ENDS is addictive, smoking produces an estimated 7,000 chemicals, including at least 70 chemicals that cause cancer. However, health effects of long-term use of ENDS are unknown.

Various studies from credible institutes – the Royal College of Physicians (RCP), London; Public Health England; National Academies of Sciences; Engineering Medicine (US); American Cancer Society; etc. – have come to the same conclusion on the relative safety of ENDS. A 3.5-year study published in Nature, a leading scientific journal, found ENDS users who never smoked showed no signs of damage that smokers exhibit.

Lawyer, Advaita Legal

Lawyer, Advaita Legal

Anupam Sanghi

Abhinava Jayaswal

Viewpoint


Another report by The Royal College of Physicians titled ‘Nicotine without smoke: tobacco harm reduction’ concluded that e-cigarettes are likely to be beneficial to public health. “Smokers can therefore be reassured and encouraged to use them, and the public can be reassured that e-cigarettes are much safer than smoking… Whilst the possibility of some harm from long-term e-cigarette use cannot be dismissed due to inhalation of the ingredients, it is likely to be very small, and substantially smaller than that arising from tobacco smoking.”

This raises further questions: Is the stance of the government prejudiced when they have put a ban on ENDS without considering all the credible evidence favouring ENDS?

Is it fair for the Government, as a stakeholder in India’s largest cigarette company, to advise banning a product without even considering the views prevailing in other jurisdictions and the reasons why they have regulated and allowed sale of ENDS?

Our government’s track record of the manner of dealing with unfamiliar issues has always been marked with a disregard for scientific findings and empirical data. Putting an outright ban coupled with perpetuating a negative rhetoric without even exploring possibilities of regulation has become the norm.

Regulating ENDS would require testing, standardization, and licensing of ENDS, especially in the light of the constant innovations in the ENDS products, the various e-liquids, and the added flavouring.

The Government’s Advisory is myopic when it labels ENDS as a possible gateway for youth to cigarette smoking. An average cost of purchasing an ENDS device is phenomenally higher than buying a conventional cigarette. An under 18-year-old is more likely to use a cigarette that can be smoked and disposed of conveniently rather than purchasing a non-disposable ENDS device. Practically speaking, a non-smoker is most likely to start off with cigarette smoking first, especially when conventional cigarettes are readily available just around the corner. A study by Public Health England also shows that “vaping is a fraction of the risk of smoking, at least 95% less harmful, and of negligible risk to bystanders.”

Governments and health organizations have succeeded more in encouraging the public through awareness campaigns and advocacy rather than by simply banning.

Why has the government issued another Circular (dated 27.11.2018, issued by the Anti-Smuggling Unit of the

Central Board of Indirect Taxes & Customs) directing Customs and related Officials to ensure implementation of the MoHFW Advisory even when the Hon’ble Delhi High Court (vide Order dated 14.11.2018) has observed that “the said Advisory is not binding and it would be open to the respective States and Union Territories to take an ‘informed decision’ in this regard”? This observation clarified matters pertaining to enforceability of the Advisory.

Depriving the population from accessing ENDS while allowing sale of conventional cigarettes, gutkha, and other tobacco products is discriminatory and such a state action stifles consumer choice.

The fear created by the government and the tobacco lobby needs to be addressed with a holistic debate on proportionate risks with an evidence-based assessment of banning tobacco and ENDS. Regulation should be directly proportionate to the health impact caused.

If the government wants to address concerns, a way forward is to effectively regulate ENDS. It could be done by treating e-cigarettes as an effective nicotine replacement therapy (NRT) and by standardizing ENDS devices and e-liquids. Also, like in the UK, the government could maintain a Planned Annual Evidence Review of e-cigarettes and support a long-term research program under its supervision. The government could also report each year on the state of research in its National Tobacco Control Programme and establish an online hub for making the detailed evidence readily available to the public and health professionals.

If the government does not wake up to the reality today, it would not only lose out on earning revenue through the taxation of ENDS but also fail in its duty of not acting in the best interest of public health. By banning ENDS and allowing production and sale of tobacco products, the government would be missing out on an opportunity to introduce a potentially less-harmful alternative to conventional cigarettes.

If the government is truly committed to good science and public health, it should carry out independent tests and research to ascertain the toxicity of ENDS and consider making available to the public a potentially far less-hazardous alternative to smoking.

Needless to say that government’s effective advocacy and regulatory strategy can really help people to naturally reduce the consumption of both tobacco and/or ENDS.

Disclaimer – The views expressed in this article are the personal views of the authors and are purely informative in nature.

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The Code has to maintain balance among the objectives by consistently ensuring

maximization of value, promotion of entrepreneurship, availability of credit

and balancing the stakeholders’ interests within a transparent

and time-bound manner

The BigConundrum

oBjeCT vs ProCess:

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As far as adoption of new legislation in India goes, the Insolvency and Bankruptcy Code, 2016 (the “Code”) has had a good run since its inception. The Code has, in little more than two and a half years, truly showed that debtors

and promoters can be stripped off of control, priority to government dues can be altered, and insolvent body corporates can be turned around in a very short period of time.

Albeit the multiple challenges encountered in the adoption of the Code (which is common for any new legislation in India), the judiciary has speedily dealt with the same, thereby demonstrating it to be justly effective and efficient towards the efficacy of the objectives, as laid down in the Code. The industry, at large, is seemingly in cheer with the functioning of the Code and its outcomes. Lately, like other legislations, few contradictions have surfaced regarding the letter of the Code. While in the legislative sense this is warranted on account of the Code’s infancy, it suffers commercial insinuations. At the outset, industries by and large prefer clear understanding and concrete foresight into the governing laws, rules and regulations, as any kind of quandary can affect, at varied degrees, the commercial viability of such industries.

Senior Manager Axis Bank Limited

Assistant Manager Axis Bank Limited

Assistant Manager Axis Bank Limited

Varun Karve

Harshit Gadiya

Saloni Jain

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This order of objective is sacrosanct.” The effect of this ruling was that the Committee of Creditors was in a position to consider and accept bids made after the deadline prescribed under the process documents as it resulted in maximization of value of the corporate debtor. The Supreme Court has also dismissed an appeal filed against the Hon’ble NCLAT judgment, a principle that has been followed subsequently.

The Binani Industries case sets a precedent as it allows maximization of the value of distressed assets and sets out a view at a macro level that the judiciary will not reject any resolution plans outrightly keeping in view the fundamental objectives. At the same time, if the order of objective as laid down in the case of Binani Industries is strictly followed without any harmonious construction thereof, it will create uncertainty as it may give room for an interpretation that the process to be followed in insolvency resolution cases can be compromised at the cost of achieving the fundamental objectives. Such an interpretation can hamper the prospects of effective and time-bound insolvency resolution, as it opens avenues for long time indulgence in the process and poses high risk of lengthy and costly litigations. A negative precedent seemingly is also set, that is, allowance of any low-bid resolution applicant to make a higher amount resolution plan after the highest resolution plan has been approved in coherence of the time-bound process.

…The first order objective is

“resolution”. The second

order objective is “maximization

of value of assets of the Corporate Debtor”, and the

third order of objective is “promoting entrepreneurship,

availability of credit and balance the interests”.

This order of objective is sacrosanct

Hon’ble Justice Shri S.J. Mukhopadhaya

Any new legislative enactment is bound to bring with it ambiguity as to its true purpose. The letter of the law often contains conflicting provisions or even grey areas which are capable of bearing many modes of constructions. In such cases, the judiciary gives a purposeful and contextual interpretation to the statute while interpreting the law in line with the object sought to be achieved. This article seeks to discuss such an interpretational issue recently faced by the judiciary, that is, the conflict between the fundamental objectives of the Code and the process which is to be adhered to, to attain the objectives.

This predicament was recently considered by the Hon’ble National Company Law Appellate Tribunal (“NCLAT”) in its judgment dated November 14, 2018 passed in the case of Binani Industries Ltd. vs Bank of Baroda & Anr., (“Binani Industries”). In this case, the importance of achieving the objective of the Code was given priority over the obligation to comply with process documents, as has been elaborated below:

Object vs ProcessThe Code in the preamble enumerates its object which is “An Act to consolidate and amend the laws relating reorganization and insolvency resolution of corporate persons, partnership firms, and individuals in a time-bound manner for maximization of value assets of such persons to promote entrepreneurship, availability of credit and balance the interest of all the stakeholders including alteration in the order of priority of payment of Government dues…”.

A recent example where this was demonstrated was in the case of Bhushan Power and Steel Limited, where a late bid made by one of the resolution applicants was accepted by the Hon’ble National Company Law Tribunal beyond the deadline set by the Committee of Creditors. Thereafter, the Hon’ble NCLAT, vide an interim order dated May 9, 2018, directed that the Committee of Creditors may consider the resolution plan submitted by all the resolution applicants. This matter is pending adjudication by the Hon’ble NCLAT, and it remains to be seen whether the judiciary will strike a balance between objectives of the Code and a time-bound process.

In the case of Binani Industries, after closure of the bids in accordance with the process documents, UltraTech Cement offered a revised resolution plan. However, the Hon’ble NCLAT accepted the revised resolution plan even though the process documents did not permit its consideration by the Committee of Creditors. The Hon’ble NCLAT observed that the revised resolution plan took care of the objective of the Code that is maximization of the value of assets of the corporate debtor and also balancing the claim of all the stakeholders of the corporate debtor. Hon’ble Justice Shri S.J. Mukhopadhaya further observed that “…The first order objective is ‘resolution’. The second order objective is ‘maximization of value of assets of the Corporate Debtor’, and the third order of objective is ‘promoting entrepreneurship, availability of credit and balance the interests’.

Take On BOard


Disclaimer – The views expressed in this Article are personal views and do not, in any manner, represent the views or stand of Axis Bank.

However, as the Hon’ble NCLAT observed in the case of Binani Industries, the process of insolvency resolution and the approval of the resolution plan is in the domain of the Committee of Creditors. The Code does not spell out the shape, color, and texture of the resolution plan, which is left to the imagination of the stakeholders. This gives wide potential for resolution plans to be customized and the corporate insolvency resolution process to be flexible depending on the facts of each case, in order to achieve maximization of value. Accordingly, resolution plans which are received within the overall timeframe prescribed under the Code and prior to the final approval of the Committee of Creditors can always be considered, even if such approval is restricted in terms of a process document designed by the Committee of Creditors and the resolution professional.

ConclusionAny challenge to the objectives of the Code is driven by judicial action, which, in upholding the object and avoiding the mischief caused by the conflicting or ambiguous provisions, have at multiple instances overridden the literal word of the Code. While such judicial action is essential in feeding longevity to the Code, absolute overriding action of the Courts can have numerous unfavorable consequences.

We have already seen an example where the judiciary has struck down process to protect the object of the Code. This was evident in the case of Central Bank of India vs Resolution Professional of Sirpur Paper Mills Limited & Others. The Regulations framed under the Code earlier allowed for differential treatment between operational and financial creditors (i.e., payment of liquidation value to dissenting financial creditors and a minimum of liquidation value to operational creditors) which was disregarded by the Hon’ble NCLAT by its order dated September 12, 2018.While this was limited to equal treatment of creditors with regard to distribution of resolution proceeds, this is an extension of the rule to grant equal say to all creditors

when it comes to conducting insolvency resolution process. Recently, while hearing various challenges to the validity of the Code, the Hon’ble Supreme Court observed whether operational creditors should have a say in the Committee of Creditors and get voting rights proportionate to the debt owed to them. Although the Supreme Court asked the government to mull over the issues raised by operational creditors, it has given a clear indication of how the Supreme Court interprets the process should be handled, in order to achieve the objectives of the Code. However, it is yet to be observed how the position of the operational creditors vis-à-vis the financial creditors will evolve over times to come.

While the above seems to be the trend that is being followed in interpreting the Code, there are examples available where the process has been followed strictly, often to the detriment of the object, i.e., value maximization. This was seen in the case of Arcelormittal India Private Limited vs. Satish Kumar Gupta & Ors., where the Hon’ble Supreme Court vide its judgment dated October 4, 2018 allowed Arcelormittal India Private Limited and Numetal Limited to re-submit resolution plans within a fixed time, even though both were initially ineligible under Section 29A of the Code. However, a subsequent proposal from Essar Steel Asia Holdings Limited (72% shareholder of ESIL) submitted to the Committee of Creditors was rejected on the ground that it was not within the mandate of the Supreme Court’s decision and the process laid down in the Regulations, even though it provided for better value as opposed to the above-mentioned resolution applicants.

Apropos, the Code has to maintain balance among the objectives by consistently ensuring maximization of value, promotion of entrepreneurship, availability of credit and balancing the stakeholders’ interests within a transparent and time-bound manner. Only then the Insolvency and Bankruptcy Code, 2016 will be utterly successful in India, ensuring speedy insolvency resolution of corporate persons.

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ProsecutionCriminal

Chapter XXII of the Income Tax Act deals with Offenses and Prosecutions. The relevant sections are from 275A to 280D. Normally, Criminal complaints are filed by the Income Tax Department for offenses punishable under

Sections 276C, 276CC, and 276B of the Income Tax Act.

Section 276CC of the Income Tax Act, 1961 is reproduced below:“If a person willfully fails to furnish in due time [the return of fringe benefits which he is required to furnish under sub-section (1) of Section 115WD or by notice given under sub-section (2) of the said section or Section 115WH or] the return of income which he is required to furnish under sub-section (1) of Section 139 or by notice given under [clause (i) of sub-section (1) of Section 142] or Section 148 [or Section 153A], he shall be punishable -

(i) In a case where the amount of tax, which would have been evaded if the failure had not been discovered, exceeds [twenty-five] hundred thousand rupees, with rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine;

(ii) In any other case, with imprisonment for a term which shall not be less than three months but which may extend to [two] years and with fine:

Provided that a person shall not be proceeded against under this section for failure to furnish in due time the [return of fringe benefits under sub-section (1) of Section 115WD or] return of income under sub-section (1) of Section 139 –

(i) For any assessment year commencing prior to the 1st day of April 1975; or

(ii) For any assessment year commencing on or after the 1st

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Advocate-On-Record Supreme Court

Rahul Kaushik

UnderIncome Tax

ActSections 275A to 280D of the

Income Tax Act deal with offenses and prosecution…

day of April 1975, if –(a) The return is furnished by him before the expiry of the

assessment year; or(b) The tax payable by him on the total income determined

on regular assessment, as reduced by the advance tax, if any, paid, and any tax deducted at source, does not exceed three thousand rupees.”

Section 278(E) of the Income Tax Act, 1961 is reproduced below:“(1) In any prosecution for any offense under this Act

which requires a culpable mental state on the part of the accused, the court shall presume the existence of such mental state but it shall be a defense for the accused to prove the fact that he had no such mental state with respect to the act charged as an offense in that prosecution.

‘Culpable mental state’ includes intention, motive or knowledge of a fact or belief in, or reason to believe, a fact.

(2) For the purpose of this section, a fact is said to be proved only when the court believes it to exist beyond reasonable doubt and not merely when its existence is established by a preponderance of probability.”

In the case of Prakash Nath Khanna and Anr. Vs. Commissioner of Income Tax and Anr. (2004) 266 ITR 1, (SC) which dealt with Section 276CC of the Income Tax Act, 1961, it was held that one of the significant terms used in Section 276CC (offense of failure to furnish return of income) of the Income Tax Act, 1961 is “in due time”. The time within which the return of income is to be furnished is indicated only in sub-section (1) of Section 139 and not in sub-section (4). Even if a return is filed under Section

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139(4), that would not dilute the infraction in not furnishing the return within the time as prescribed under sub-section (1) of Section 139. Also, whether there was willful failure to furnish the return is a matter which is to be adjudicated factually by the court which deals with the prosecution case. Section 278E is relevant for this purpose. There is a statutory presumption prescribed in Section 278E. The court has to presume the existence of culpable mental state, and absence of such mental state can be pleaded by an accused as a defense in respect of the act charged as an offense in the prosecution. The same was followed in Sasi Enterprises vs. Assistant Commissioner of Income Tax [2014] 361 ITR 163 (SC).

The other relevant sections are 276B, 278B, and 2[35] of the Income Tax Act, 1961 which deal with Criminal Prosecution for failure on the part of Company in deducting tax at source and paying to the account of Central Government.

Section 276B of the Income Tax Act, 1961 is reproduced below:“If a person fails to pay to the credit of the Central Government, -

(a) The tax deducted at source by him as required by or under the provisions of Chapter XVII-B; or

(b) The tax payable by him, as required by or under -(i) Sub-section (2) of Section 115-O; or(ii) The second proviso to Section 194B,

he shall be punishable with rigorous imprisonment for a term which shall not be less than three months but which may extend to seven years and with fine.”

Section 278B of the Income Tax Act, 1961 is reproduced below:“(1) Where an offense under this Act has been committed by a company, every person who, at the time the offense was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company as well as the company shall be deemed to be guilty of the offense and shall be liable to be proceeded against and punished accordingly.

Provided that nothing contained in this sub-section shall render any such person liable to any punishment if he proves that the offense was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offense.

(2) Notwithstanding anything contained in sub-section (1), where an offense under this Act has been committed by a company and it is proved that the offense has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offense and shall be liable to be proceeded against and punished accordingly.

[(3) Where an offense under this Act has been committed by a person, being a company, and the punishment for such offence is imprisonment and fine, then, without prejudice to the provisions contained in sub-section (1) or sub-section (2), such company shall be punished with fine and every person, referred to in sub-section (1), or the director, manager, secretary or other officer of the company referred to in sub-section (2), shall be liable to be proceeded against and punished in accordance with the provisions of this Act.]”

Explanation – For the purposes of this section, -

(a) “company” means a body corporate, and includes –(i) a firm; and(ii) an association of persons or a body of individuals

whether incorporated or not; and

(b) “director”, in relation to –(i) A firm, means a partner in the firm;(ii) Any association of persons or a body of individuals,

means any member controlling the affairs thereof.

Section 2[35] of the Income Tax Act is reproduced below:“Principal Officer”, used with reference to a local authority or a company or any other public body or any association of persons or any body of individuals, means- (a) the secretary, treasurer, manager or agent of the

authority, company, association or body, or(b) any person connected with the management or

administration of the local authority, company, association or body upon whom the [Assessing] Officer has served a notice of his intention of treating him as the principle officer thereof.”

Section 276B deals with failure to deduct tax at source, Section 278B deals with Offences by Companies, and Section 2[35] deals with Principle Officers. It was held by the Hon’ble Supreme Court in the case of Madhumilan Syntex Ltd. & Ors. Vs. UOI & Anr. (2007) 290 ITR 199 (SC) that wherever a company is required to deduct tax at source and to pay it to the account of the Central Government, failure on the part of the company in deducting or in paying such amount is an offense under the Act and has been made punishable. It, therefore, cannot be said that the prosecution against a company or its directors in default of deducting or paying tax is not envisaged by the Act.

From the above statutory provisions, it is clear that to hold a person responsible under the Act, it must be shown that he/she is a “principle officer” under Section 2[35] of the Act or is “in charge of” and “responsible for” the business of the company or firm. It is also clear from the cases referred to above that where necessary averments have been made in the complaint, initiation of criminal proceedings, issuance of summons, or framing of charge cannot be held illegal and the court would not inquire into or decide the correctness or otherwise of the allegations leveled or averments made by the complainant. It is a matter of evidence and an appropriate order can be passed at the trial. It was further

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held that even if TDS was already deposited to the account of the Central Government and there was no default and no prosecution could be ordered, yet the same was not accepted by the court and it was held that once a statute requires to pay tax and stipulates the period within which such payment is to be made, the payment must be made within that period. If the payment is not made within that period, there is default and an appropriate action can be taken under the Act.

The same was followed by the Hon’ble Delhi High Court in CRL. L.P. 85 OF 2010 in the case of Income Tax Officer Vs. M/s. Delhi Iron Works (P) Ltd. & Ors. decided on 11.11.2010 and CRL. L.P. 241 of 2012 in the case of Income Tax Officer Vs. Anil Batra & Anr. decided on 23.09.2014.

Pendency of reassessment proceedings is not a bar to institution of criminal prosecution for offenses punishable under the Income Tax Act It was held by the Hon’ble Supreme Court in the case of P. Jayappan vs. S.K. Perumal, First Income-Tax Officer, Tuticorin (1984) 149 ITR 696 (SC) that pendency of the reassessment proceedings cannot act as a bar to the institution of criminal prosecution for the offenses punishable under Section 276C or 277 of the Act. The same was followed by different High Courts in Assistant Commissioner of Income Tax Vs. S.P. Bansal and Others (2000) 243 ITR 406 Delhi, R.G. Agarwal and Co. & Ors. Vs. Union of India (1994) 210 ITR 617 (MP), Surjit Engineering Works & Ors. Vs. Income Tax Officer (1994) 210 ITR 547 (P&H), Kalyan Rice and General Mills & Anr. Vs. Income Tax Officer (1989) 180 ITR 41 (P&H), Shankar and Company & Ors. Vs. Third Income-Tax Officer (1992) 193 ITR 172 (Kar.).

Sanction of [Principal Chief Commissioner or] Chief Commissioner or [Principal Commissioner or] Commissioner] for proceeding for an offense under the Income Tax ActAs per Section 279 of the Income Tax Act, a person shall not be proceeded for an offense under the Act except with the previous sanction of the [Principal Commissioner or] Commissioner or Commissioner (Appeals) or the appropriate authority.

Compounding of offenses punishable under the ActThe explanation to Section 279 of the Income Tax Act vests the CBDT with the powers to issue circulars, orders, instructions, or directions “for proper composition” of offences. The Hon’ble Supreme Court in the case of Y.P. Chawla Vs. M.P. Tiwari (1992) 2 SCC 672 had upheld the

validity of guidelines issued by the CBDT under Section 119(1) of the Act and recognized the power of the CBDT to issue guidelines for compounding including compounding charges in exercise of powers under Section 279(2) of the Act. In M.P. Purusothaman v. Assistant Director of Income Tax (Prosecution) [2001] 252 ITR 603, the Hon’ble High Court of Madras, while considering the power of the CBDT to compound an offense under Chapter XXII of the Act held that compounding of an offense is the exception and not the rule. Compounding fee is of a deterrent nature and is imposed with a view to ensure compliance with the law.

Writ Petition No. 6268 of 2017 in the case of Vikram Singh Vs. Union of India & Ors. was filed before the Hon’ble Delhi High Court challenging the imposition, legality, and validity of compounding fee – a fee charged under the Income Tax Act, 1961 (for short, ‘the Act’), to compound offenses committed by assessee. Challenge was primarily raised to the legality of the quantum of compounding fee, as prescribed by guidelines issued by the Central Board of Direct Taxes (for short, ‘CBDT’) dated 23rd December 2014 and quashing of the same as being arbitrary and unfair. The writ petition was dismissed by holding that in view of the decision of Y.P. Chawla vs. M.P. Tiwari (1992) 2 SCC 672, the power to issue guidelines is now unquestionable and cannot be challenged.

Interference by high courts after issuance of summons and framing of charge in Criminal complaints filed under Sections 276C, 276CC, and 276BIn case of Madhumilan Syntex Ltd. & Ors. Vs. UOI & Anr. (2007) 290 ITR 199 (SC), which dealt with Sections 276B, 278B, and 2[35] of the Act, it was held that where necessary averments have been made in the complaint, initiation of criminal proceedings, issuance of summons, or framing of charge, cannot be held illegal and the court would not inquire into or decide the correctness or otherwise of the allegations leveled or averments made by the complainant. It is a matter of evidence and an appropriate order can be passed at the trial. In the case of Prakash Nath Khanna and Anr. Vs. Commissioner of Income Tax and Anr. (2004) 266 ITR 1, which dealt with Section 276CC of the Act, it was held by the Hon’ble Supreme Court that whether there was a willful failure to furnish the return is a matter of trial and the High Court had rightly not interfered against the orders issuing summons because as per Section 278E of the Income Tax Act, there is a presumption as to culpable mental state. The same view was taken in the case of Sasi Enterprises Vs. Assistant Commissioner of Income-Tax reported in [2014] 361 ITR 163 (SC). The Hon’ble Delhi High Court in Crl. M.C. No. 3385 of 2016 in the case of Karan Luthra vs. Income Tax Officer decided on 14.09.2018 refused to interfere against the order framing charges under Section 276CC of the Income Tax Act following the judgment of the Hon’ble Supreme Court in Sasi Enterprises.

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SALIENT FEATURES OF CONSUMER PROTECTION BILL, 2018 PASSED BY LOK SABHA

the District Council. The objects of every District Council shall be to render advise on promotion and protection of consumer rights under this Act within the district.

CENTRAL CONSUMER PROTECTION AUTHORITYThe Central Government shall establish a Central Consumer Protection Authority to be known as the Central Authority to regulate matters relating to violation of rights of consumers, unfair trade practices and false or misleading advertisements which are prejudicial to the interests of public and consumers and to promote, protect and enforce the rights of consumers as a class.

The Central Authority shall:• protect,promoteandenforcetherightsofconsumers

as a class, and prevent violation of consumers rights under this Act;

• preventunfairtradepracticesandensurethatnopersonengages himself in unfair trade practices;

• ensure that no false or misleading advertisement ismade of any goods or services which contravenes the provisions of this Act or the rules or regulations made thereunder;

• ensurethatnopersontakespartinthepublicationofany advertisement which is false or misleading.

CONSUMER DISPUTES REDRESSAL COMMISSIONThe State Government shall establish a District Consumer Disputes Redressal Commission to be known as the District Commission in each district of the State: Provided that the StateGovernmentmay,ifitdeemsfit,establishmorethanone District Commission in a district.

Subject to the other provisions of this Act, the District Commission shall have jurisdiction to entertain complaints where the value of the goods or services paid as consideration does not exceed one crore rupees: Provided that where the Central Government deems it necessary so todo,itmayprescribesuchothervalue,asitdeemsfit.

The State Government shall establish a State Consumer Disputes Redressal Commission to be known as the State Commission in the State. Subject to the other provisions of this Act, the State Commission shall have jurisdiction:

(a) to entertain—• complaints where the value of the goods or services

paid as consideration, exceeds rupees one crore, but does not exceed rupees ten crore: Provided that where the Central Government deems it necessary so to do, it mayprescribesuchothervalue,asitdeemsfit.

• complaints against unfair contracts, where the valueof goods or services paid as consideration does not exceed ten crore rupees.

On December 20, the Lok Sabha, the lower house of India’s bicameral Parliament, passed the Consumer Protection Bill, 2018, thus repealing the Consumer Protection Act, 1986.

The Bill aims to provide for protection of the interests of consumers, and for the said purpose, to establish authorities for timely and effective administration and settlement of consumers’ disputes and for matters connected therewith or incidental thereto.

According to Minister Ram Vilas Paswan, Minister of Consumer Affairs, Food and Public Distribution, “The Consumer Protection Bill, 2018 provides for the establishment of an executive agency to be known as the Central Consumer Protection Authority (CCPA) to promote, protect and enforce the rights of consumers; make interventions when necessary to prevent consumer detriment arising from unfair trade practices and to initiate class action including enforcing recall, refund and return of products,etc.Thisfillsaninstitutionalvoidintheregulatoryregime extant. Currently, the task of prevention of or acting against unfair trade practices is not vested in any authority. This has been provided for in a manner that the role envisaged for the CCPA complements that of the sector regulatorsandduplication,overlaporpotentialconflict isavoided.”

The Minister added, “The Bill also envisages provisions for product liability action on account of harm caused to consumersduetoadefectiveproductorbydeficiencyinservices. Further, provision of “Mediation” as an Alternate Dispute Resolution Mechanism has also been provided. The Bill provides for several provisions aimed at simplifying the consumer dispute adjudication process of the Consumer Disputes Redressal Agencies, inter alia, relating to enhancing the pecuniary jurisdiction of the Consumer Disputes Redressal Agencies; increasing minimum number of Members in the State Consumer Disputes Redressal Commissions and provisions for consumers to filecomplaints electronically, etc.”

The salient features of the Bill are:

CONSUMER PROTECTION COUNCILS• The Central Government shall establish the Central

Consumer Protection Council to be known as the Central Council. The objects of the Central Council shall be to render advise on promotion and protection of the consumers’ rights under this Act.

• EveryStateGovernmentshallestablishaStateConsumerProtection Council for such State to be known as the State Council. The objects of every State Council shall be to render advise on promotion and protection of consumer rights under this Act within the State.

• TheStateGovernmentshallestablishforeveryDistricta District Consumer Protection Council to be known as

Read more: http://www.legaleraonline.com/news/salient-features-of-consumer-protection-bill-2018-passed-by-lok-sabha

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SALIENT FEATURES OF SURROGACY (REGULATION) BILL, 2016 PASSED BY LOK SABHA

35 years. She can act as surrogate mother only once.• Thesurrogatemotherwillcarryachildwhichisgenetically

related to the Intending Couple.• Anorderconcerningtheparentageandcustodyof the

child to be born through surrogacy, is to be passed by a courtoftheMagistrateofthefirstclass.

• An insurance coverage of reasonable and adequateamount shall be ensured in favour of the surrogate mother.

• NationalSurrogacyBoardshallexercisethepowersandshall perform functions conferred on the Board under this Act.

• TheBoardshallconsistoftheMinisterin-chargeoftheMinistry of Health and Family Welfare, as the Chairperson, Secretary to the Government of India in- charge of the Department dealing with the surrogacy matter, as Vice-Chairperson and three women Members of Parliament, of whom two shall be elected by the House of the People and one by the Council of State as Members.

• The National Surrogacy board and State Surrogacyboard shall be the Policy making bodies and Appropriate Authority will be the Implementation body for the Act.

• The appropriate authority shall comprise of an officerof or above the rank of the Joint Director of Health and Family Welfare Department, as Chairperson, an eminent woman representing women’s organization, as member, anofficerofLawDepartmentoftheStateortheUnionterritory concerned not below the rank of a Deputy Secretary, as member and an eminent registered medical practitioner, as a member.

• The surrogacy clinics shall be registered under this Act after the Appropriate Authority is satisfied that such clinics are in a position to provide facilities and can maintain equipments and standards including specialised manpower, physical infrastructure and diagnostic facilities as may be prescribed in the rules and regulations.

• No person, organisation, surrogacy clinic, laboratoryor clinical establishment of any kind shall undertake commercial surrogacy, abandon the child, exploit the surrogate mother, sell human embryo or import embryo for the purpose of surrogacy. Violation to the said provision shall be an offence punishable with imprisonment for a term which shall not be less than ten yearsandwithfinewhichmayextendtotenlakhrupees.

• Thesurrogacyclinicsshallhavetomaintainallrecordsfora period of 25 years.

• Transitional provision-Subject to the provisions of thisAct, there shall be provided a gestation period of ten months from the date of coming into force of this act to protect the wellbeing of already existing surrogate mothers.

On December 19, the Lok Sabha passed the Surrogacy (Regulation) Bill, 2016.

AccordingtoHealthMinisterJPNadda,theBillaimstostopcommercial surrogacy but at the same time save families by allowing them to have children by using modern science.

The Department of Health Research on its website states the following:

The Surrogacy (Regulation) Bill, 2016 proposes to regulate surrogacy in India by establishing National SurrogacyBoard at the Central level, State Surrogacy Boards and Appropriate Authorities in States and Union Territories.The proposed legislation ensures effective regulation of surrogacy, prohibits commercial surrogacy, and allows ethical surrogacy to the needy infertile Indian couples.

The major objectives of the Bill are to regulate surrogacy services in the country, to provide altruistic ethical surrogacy to the needy infertile Indian couples, to prohibit commercial surrogacy including sale and purchase of human embryo and gametes, to prevent commercialization of surrogacy, to prohibit potential exploitation of surrogate mothers, and to protect the rights of children born through surrogacy.

The salient features of the Bill are:• Toallowaltruisticethicalsurrogacytointendinginfertile

couples between the age of 23-50 years and 26-55 years for female and male, respectively.

• The intending couples shouldbe legallymarried for atleastfiveyearsandshouldbeIndiancitizens.

• Theintendingcoupleshavenothadanysurvivingchildbiologically or through adoption or through surrogacy earlier except when they have a child and who is mentally or physically challenged or suffer from life-threatening disorder with no permanent cure.

• Theintendingcouplesshallnotabandonthechildbornout of a surrogacy procedure under any condition.

• The child born through surrogacy will have the samerights as are available for the Biological child.

• Thesurrogatemothershouldbeaclose relativeof theintending couple and should be between the age of 25-

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PM MODI PRESENTS 9-POINT PROGRAM AGAINST FUGITIvE ECONOMIC OFFENDERS

trade, financial and tax systems, PMModi observed thatthe grouping has completed 10 years and highlighted the cooperation among the members that restored growth and revival of growth post the 2008 economic meltdown.

Moreover, PM Modi at the Summit also presented a 9-point program on the ways to take stringent action against fugitive economic offenders.• StrongandactivecooperationacrossG-20countriestodealcomprehensivelyandefficientlywiththemenaceoffugitive economic offenders.

• Cooperation in the legal processes such as effectivefreezing of the proceeds of crime; early return of the offenders and efficient repatriation of the proceeds ofcrime should be enhanced and streamlined.

• JointeffortbyG-20countriestoformamechanismthatdenies entry and safe havens to all fugitive economic offenders.

• Principles of United Nations Convention AgainstCorruption(UNCAC),UnitedNationsConventionAgainstTransnational Organized Crime (UNOTC), especiallyrelated to “International Cooperation” should be fully and effectively implemented.

OnDecember1,PrimeMinisterNarendraModiannouncedat the 13th G-20 Summit held in the Argentinian capital, Buenos Aires, that India, for the first time, will host theannual G-20 Summit in 2022, at a time when the country celebrates its 75th anniversary of Independence.

PM Modi then said, “In 2022, India completes 75 years since Independence. In that special year, India looks forward to welcoming the world to the G-20 Summit! Come to India, the world’s fastest growing large economy! Know India’s rich history and diversity and experience the warm Indian hospitality”. At the Summit, which focused on international

BOARDS OF GSK INDIA, HUL APPROvE MERGER PROPOSALOn December 03, HindustanUnileverLimited (HUL)—anIndia-based fast-moving consumer goods company— announced its board’s approval on its merger with GlaxoSmithKline Consumer Healthcare (GSKCH India)— one of the largest players in the Health Food Drinks industry in India—throughan-all equitydeal, valuing thetotal business of the latter at `31,700 crore.

Also, GSK said, “The transaction is conditional on the approval of the merger by the shareholders and creditors of each of GSK India andHUL. The Boards of GSK IndiaandHULhavebothapproved themerger.BothGSKandUnilever,whohold72.5%and67.2%ofthesharesinGSKIndia and HUL respectively, intend to vote in favor ofthemerger.”HUL,however, stated that theacquisition issubject to obtaining requisite approvals from statutoryauthorities and shareholders.

In this regard, GSK added, “The transaction is also subject to certain other conditions including the receipt of anti-trust clearances in India, the approval of the merger by therelevantNationalCompanyLawTribunals,andcertainother customary closing conditions... Proceeds will be used

to support the Group’s strategic priorities and reduce debt and the transaction is expected to be neutral to earnings.”

Notably,thistransactionisanall-equitymergerwith4.39sharesofHULbeingallottedforeveryshareinGSKCHIndia.

HULthensaid,“HULhasreachedadefiniteagreementwithGSKCHIndiainthisregard.”Thereafter,HUL’sChairmanandManaging Director Sanjiv Mehta said, “With this proposed strategic merger with GSKCH India, we will be expanding our portfolio with great brands into a new category catering to the nutritional needs of our consumers.”

Read more: http://www.legaleraonline.com/news/pm-modi-presents-9-point-program-to-take-stringent-action-against-fugitive-economic-offenders

Read more: http://www.legaleraonline.com/news/boards-of-gsk-india-hul-approve-merger-proposal

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MINISTRY OF HOME AFFAIRS ISSUES HANDBOOK ON CYBER SAFETY FOR STUDENTS/ADOLESCENTSOn December 3, the Ministry of Home Affairs (MHA), Government of India, in consultation with Cyber Security experts prepared a Handbook for Students/Adolescents on Cyber Safety. The Handbook aims at creating awareness among citizens, especially students, about various cyber threats that can impact them and ways to safeguard themselves against cybercrimes. As reported in the Handbook, “Children are highly vulnerable as they are exposed to cyber space with limited understanding of cyber threats and safeguards. Children are in the experimental age group. They like to experiment, learn new things and use new technologies. Whileexperimenting is agoodway to learn, it is equallyimportant that proper guidance is provided to children so that they can protect themselves from the adverse impact of cyber technology.”Considering this issue, the Handbook was mainly designed for children above 13 years of age, but can also be used by younger students as well to understand the cyber world

better and prepare themselves to be responsible and careful cyber citizens of future. The Handbook provides an overview of various cyber threats that can impact children and discusses safeguards that can help in preventing the cybercrimes. Read more: http://www.legaleraonline.com/news/ministry-of-home-affairs-issues-handbook-for-students-adolescents-on-cyber-safety

HCL TO ACqUIRE SELECT IBM SOFTwARE PRODUCTS FOR $1.8 BILLION IN BIGGEST INDIAN IT DEAL

areacquiringareinlargegrowingmarketareaslikeSecurity,Marketing, and Commerce which are strategic segments for HCL. Many of these products are well regarded by clients andpositionedinthetopquadrantbyindustryanalysts”.Vijayakumar further added, “The large-scale deployments of these products provide us with a great opportunity to reach and serve thousands of global enterprises across a wide range of industries and markets. I am confident that these products will see a good growthtrajectory backed by our commitment to invest in product innovation coupled with our strong client focus and agile product development. In addition, we see tremendous potential for creating compelling ‘as-a-service’ offerings by combining these products with our Mode-1 and Mode-2 services”.Subsequently, IBM’s Senior Vice President, CognitiveSolutions and Research, John Kelly said, “Over the last four years, we have been prioritizing our investments to develop integrated capabilities in areas such as AI for business, hybrid cloud, cybersecurity, analytics, supply chain, and blockchain as well as industry-specific platforms andsolutionsincludinghealthcare,industrialIOT,andfinancialservices. These are among the emerging, high-value segments of the IT industry. As a result, IBM is a leader in these segments today”.

In what can be seen as the biggest Indian IT deal till date, IBM and HCL Technologies (HCL) announced on December 7 a definitive agreement under which HCL will acquireselect IBM software products for $1.8 billion. The select software products referred to above include: Appscan for secure application development; BigFix for secure device management; Unica (on-premise) formarketing automation; Commerce (on-premise) for omni-channel eCommerce; Portal (on-premise) for digital experience;Notes&Dominoforemailandlow-coderapidapplication development; and Connections for workstream collaboration. These products represent a total addressable market of more than $50 billion. As per a Press Release issued by the company, with regard to the deal, HCL’s President&CEOCVijayakumarsaid,“Wecontinuetoseegreat opportunities in the market to enhance our Mode-3 (Products and Platforms) offerings. The products that we

Read more: http://www.legaleraonline.com/news/hcl-to-acquire-select-ibm-software-products-for-1-8-billion-in-biggest-indian-it-deal

Policy UPdate


SEBI: DEaDlInE ExtEnDED for tranSfEr of SEcurItIES only In DEmat form

The Securities and Exchange Board of India (SEBI) on December 03 issued a press release regarding the extension of the date of transfer of securities only in Demat form till

rEport on lIStIng of EquIty SharES of companIES IncorporatED In InDIa on forEIgn Stock ExchangES, vIcE vErSa: SEBIThe Securities and Exchange Board of India (SEBI) had on June 12, 2018 constituted an ‘Expert Committee for listing of equity shares of companies incorporated in India on foreign stock exchanges and of companies incorporated outside India on Indian stock exchanges’, with a view to facilitating companies incorporated in India to directly list their equity shares on foreign stock exchanges and companies incorporated outside India to list on Indian stock exchanges, in view, particularly, of the ongoing evolution and internationalization of capital markets across the globe. The Committee recommended a framework for direct listing of equity shares of companies incorporated in India on foreign stock exchanges and vice versa. The Committee submitted its report to SEBI on December 4, 2018.The broad ‘Terms of Reference’ of the Committee were to: a) Examine in detail the economic case for permitting direct

listing of Indian companies overseas and vice versa;b) Examine various legal, operational, and regulatory

constraints in facilitating companies incorporated in India to directly list their equity share capital abroad and vice versa; and

c) Make recommendations for a suitable framework in which to facilitate such direct listing.

The Report States:• TheexistinglegalframeworkinIndiadoesnotpermitthe

direct listing of equity shares of companies incorporated in India on foreign stock exchanges. Similarly, companies incorporated outside India cannot directly list their equity shares on Indian stock exchanges.

• The only available routes for companies incorporatedin India to access the equity capital markets of foreign jurisdictions is through the American Depository Receipts (“ADR”) and Global Depository Receipts (“GDR”) regimes.

Read more: http://www.legaleraonline.com/news/report-on-listing-of-equity-shares-of-companies-incorporated-in-india-on-foreign-stock-exchanges-vice-versa-sebi

Companies incorporated in India can list their debt securities on foreign stock exchanges directly through the masala bonds and/or foreign currency convertible bond (“FCCB”)/foreign currency exchangeable bond (“FCEB”) framework. On the other hand, companies incorporated outside India can access the Indian capital markets only through the Indian Depository Receipts (“IDR”) framework.

• A well-developed, smoothly operating capital marketplays an important role in contributing to the health and efficiency of an economy. In addition, there is a strongpositive relationship between capital market development and economic growth. Equity listings by companies incorporated in India on foreign stock exchanges would allow them to access foreign capital at a lower cost. The Indian economy, in turn, will experience added growth and economic development. Similarly, equity listings of companies incorporated outside India on Indian Stock Exchanges would improve the efficient allocation ofcapitalanddiversificationforinvestorsacrosstheIndianeconomy.

April 1, 2019. The release stated, “The Board, on March 28, 2018, decided that except in case of transmission or transposition of securities, requests for effecting transfer of securities shall not be processed unless the securities are held in the dematerialized form with a depository. This measure was to come into effect from December 5, 2018.”

It concluded, “Subsequently, SEBI has received representations from shareholders for extension of the date of compliance. In view of the same, the deadline has been extended and the aforesaid requirement of transfer of securities only in Demat form shall now come into force from April 1, 2019.”

Policy UPdate


lEgal EntIty IDEntIfIEr coDE for partIcIpatIon In non-DErIvatIvE markEtS: rBIThe Reserve Bank of India (RBI) recently issued a Press Release to all eligible market participants regarding the use ofLegalEntityIdentifier(LEI)Codeforparticipationinnon-derivative markets.

The Release states:1. The LEI Code has been conceived of as a key measure

to improve the quality and accuracy of financial datasystems for better risk management post the Global Financial Crisis. The LEI is a 20-character unique identity codeassignedtoentitieswhoarepartiestoafinancialtransaction. Globally, the use of LEI has expanded beyond derivative reporting and it is being used in areas relating to banking, securities market, credit rating, market supervision, etc. (https://www.gleif.org/en/about-lei/regulatory-use-of-the-lei).

The LEI system has been implemented in a phased manner for participants (other than individuals) in the over-the-counter markets for rupee interest rate derivatives, foreign currency derivatives, and credit derivatives in India in terms of RBI circular FMRD.FMID No. 14/11.01.007/2016-17 dated June 1, 2017 and for large corporate borrowers of banks in terms of RBI Circular DBR.No.BP.BC.92/21.04.048/2017-18 dated November 2, 2017.

2. In the Statement on Developmental and Regulatory Policies, First Bi-monthly Monetary Policy Statement for 2018-19 (Paragraph No. 8), dated April 05, 2018, it was proposed to implement the LEI mechanism for all financial market transactions undertaken by non-individuals in interest rate, currency or credit markets regulated by RBI. Accordingly, draft directions in this regard were issued for public comments on June 20, 2018. Based on comments received during the consultation, the directions on requirement of LEI Code for participation in non-derivative markets have been finalizedasbelow.

3. All participants, other than individuals, undertaking transactions in the markets regulated by RBI viz., Government securities markets, money markets (markets for any instrument with a maturity of one year or less), and non-derivative forex markets (transactions that settle on or before the spot date) shall obtain Legal EntityIdentifier(LEI)codesbytheduedateindicatedinthe schedule given in Annex.

Only those entities that obtain an LEI code on or before the due dates applicable to them shall be able to undertaketransactionsinthesefinancialmarketsafterthe due date, either as an issuer or as an investor or as a seller / buyer. Transactions undertaken on recognized stock exchanges are outside the purview of the LEI requirement.

4. In case of non-derivative forex transactions, while all inter-bank transactions shall be subject to LEI requirement, client transactions shall require LEI code for transactions involving an amount equivalent to or exceeding USD one million or equivalent thereof in other currencies.

Read more: http://www.legaleraonline.com/news/legal-entity-identifier-code-for-participation-in-non-derivative-markets-rbi

rBI SanctIonS SchEmE of amalgamatIon of SBm Bank (maurItIuS) ltD, InDIa wIth SBm Bank (InDIa) ltDA press release issued by the Reserve Bank of India (RBI) stated that in the exercise of the powers contained in sub-section (4) of Section 44A of the Banking Regulation Act, 1949, effective December 01, 2018, the RBI has sanctioned the scheme of amalgamation of the entire undertaking of SBM Bank (Mauritius) Limited, India with SBM Bank (India) Limited, which has been granted license by the Reserve Bank to carry on the business of banking in India through Wholly Owned Subsidiary (WOS) Mode under Section 22(1) of the Banking Regulation Act, 1949.

As per the release, all branches of SBM Bank (Mauritius) Limited in India will function as branches of SBM Bank (India) Limited with effect from December 01, 2018.Established in 1973, SBM has a strong franchise in Mauritius, with a market share of more than 20% in domestic advances and deposits. The group is also present in Madagascar, India, and Kenya. In addition to banking services, SBM proposes non-bankingfinancialservicessuchasinvestmentbanking,privatewealth advisory, stockbroking, and asset management. The groupalsooperatesanon-financialclusterforinvestments.

Policy UPdate


IrDaI rElEaSES rEport on nEw StanDarD on InSurancE contractS

The Insurance Regulatory and Development Authority of India (IRDAI) on December 6 released a Report of the Working Group (WG) on New Standard on Insurance Contracts (Equivalent to IFRS 17 Insurance Contracts).Executive Summary of the Recommendations is as follows:

• StandardandRegulations1. TheDraftRegulationsmaybenotifiedafternotification

of Ind AS 117 and addressing issues/concerns, if any, that may come up from the findings of the Ind AScompliant proforma financial statements prepared byinsurers as per the Draft Regulations.

2. The recommendations of the WG in this report and the Draft Regulations proposed are based on the IFRS 17notifiedbythe InternationalAccountingStandardsBoard (IASB) on May 18, 2017 and the Exposure Draft of Ind AS 117 issued by the Accounting Standards Board (ASB) of the Institute of Chartered Accountants of India (ICAI). These may undergo a change in case the IASB

rBI ISSuES StatEmEnt on DEvElopmEntal anD rEgulatory polIcIES

loans(housing,auto,etc.)andfloatingrateloanstoMicroand Small Enterprises extended by banks from April 1, 2019 shall be benchmarked to one of the following:• ReserveBankofIndiapolicyreporate,or• Government of India 91 days Treasury Bill yield

produced by the Financial Benchmarks India Private Ltd (FBIL), or

• Government of India 182 days Treasury Bill yieldproduced by the FBIL, or

• Anyotherbenchmarkmarketinterestrateproducedbythe FBIL.

The spread over the benchmark rate — to be decided wholly at banks’ discretion at the inception of the loan — should remain unchanged through the life of the loan, unless the borrower’s credit assessment undergoes a substantial change and as agreed upon in the loan contract. Banks are free to offer such external benchmark linked loans to other types of borrowers as well.

The Reserve Bank of India (RBI) recently issued a press release on December 05 reporting the Statement on Developmental and Regulatory Policies. This Statement sets out various developmental and regulatory policy measures for strengthening regulation and supervision; broadening and deepening of financial markets; and enhancingcustomereducation,protection,andfinancialinclusion.The Release states:I.RegulationandSupervision1. External Benchmarking of New Floating Rate Loans by BanksThe Report of the Internal Study Group to Review the Working of the Marginal Cost of Funds based Lending Rate (MCLR) System (Chairman: Dr. Janak Raj) released on October 4, 2017 for public feedback, had recommended theuseofexternalbenchmarksbybanksfortheirfloatingrate loans instead of the present system of internal benchmarks [Prime Lending Rate (PLR), Benchmark Prime Lending Rate (BPLR), Base rate and Marginal Cost of Funds based Lending Rate (MCLR)]. As a step in that direction, it isproposedthatallnewfloatingratepersonalor retail

Read more: http://www.legaleraonline.com/news/rbi-issues-statement-on-developmental-and-regulatory-policies

Read more: http://www.legaleraonline.com/news/irdai-releases-report-on-new-standard-on-insurance-contracts

concludes that there is a need to amend IFRS 17 or issue clarifications,whichwillhavetobesuitablyconsideredby the Authority.

3. Section 11 of the Insurance Act 1938 may be amended to consider Statement of Changes in Equity as a separatefinancialstatement.

4. The Authority may take up with the ASB with regard to the amendment to Ind AS 1 in order to facilitate usageoftitlesforfinancialstatementsstipulatedunderspecialized legislations by which ‘Revenue Account’ in case of insurance companies can be presented as a separate statement rather than making it part of ‘StatementofProfitandLossAccount’.

• FinancialStatements5. Single format of financial statements without

distinguishing between life and other than life insurance business is recommended. This is because, IFRS 17 differentiates measurement of insurance contracts based on duration of contracts and does not distinguish between life and general insurance business.

6. Cash Flow Statement under Direct method is recommended. The Authority may examine whether reinsurance companies can be permitted indirect method of preparing Cash Flow Statement.

Policy UPdate


formEr EconomIc affaIrS SEcrEtary ShaktIkanta DaS aSSumES chargE aS 25th rBI govErnorOn December 12, Former Economic Affairs Secretary ShaktikantaDas, retired IAS officer of TamilNadu cadre,1980 batch, assumed charge as the 25th RBI Governor for a period of three years.

Das succeeds Dr. Urjit Patel, who resigned with immediate effect on December 10 citing personal reasons. Dr. Patel, whose term was to end in September 2019, had on December 10 said, “On account of personal reasons, I have decided to step down from my current position effective immediately. It has been my privilege and honor to serve in the Reserve Bank of India in various capacities over the years.ThesupportandhardworkofRBIstaff,officers,andmanagement has been the proximate driver of the Bank’s considerable accomplishments in recent years. I take this opportunity to express gratitude to my colleagues and Directors of the RBI Central Board, and wish them all the best for the future.”

Shaktikanta Das (born February 26, 1957) is a retired 1980 batch Indian Administrative Service (IAS) officer of TamilNadu cadre. He was earlier a member of the Fifteenth Finance Commission of India and India’s Sherpa to the G20.

Duringhis careerasan IASofficer,Das served invariouscapacities for Indian and Tamil Nadu governments, including as Principal Secretary (Industries), Special Commissioner (Revenue), Secretary (Revenue), Secretary

IrDaI ImpoSES `5 lakh pEnalty on hDfc Ergo gEnEral InSurancE company lImItED

2. The Insurer has violated File & Use Guidelines / Circulars issued by the Authority from time to time advising General Insurers that they shall continue to use the coverage, terms & conditions, wordings, warranties, clauses and endorsements of the erstwhile tariff of classes of insurance covers until further orders.

A gist of the submissions made by the Insurer is as follows:• IDV is themaximum liabilityof the insurerwhich is to

be taken into consideration for settlement of the loss with a condition that, the scale of depreciation stated in GR 8 and GR 9 is followed. We have followed both these general rules but the claim procedure cannot be a mathematical equation as stated in the GR about the depreciation and the value etc. The quantum of the claim settlement is substantially drivenby specificterms, in addition to GR 8 and GR 9, stated in the policy contract and its schedule.

On December 5, in a case of Settlement of Motor Claims, the Insurance Regulatory and Development Authority of India (IRDAI) imposed a penalty of `5 lakh on HDFC ERGO General Insurance Company Limited based on a few complaints relating to General Insurers settling lesser amounts than the Insured Declared Value (hereinafterreferredtoasIDV)incaseofmotorvehicletotalloss/theftclaims.Two Charges were levied on the Insurer [HDFC ERGO]: 1. The Company has violated the Provisions of General

Regulation 8 of All India Motor Tariff, 2002 while settling motor claims, which states as follows:

• “ForthepurposeofTL/CTLclaimsettlement,thisIDVwillnot change during the currency of the policy period in question.”

• “TheIDVshallbetreatedasthe‘MarketValue’throughoutthe policy period without any further depreciation for the purpose of Total Loss (TL) / Constructive Total Loss (CTL) claims.”

Read more: http://www.legaleraonline.com/news/irdai-imposes-rs-5-lakh-penalty-on-hdfc-ergo-general-insurance-company-limited

Read more: http://www.legaleraonline.com/news/former-economic-affairs-secretary-shaktikanta-das-assumes-charge-as-25th-rbi-governor

(Commercial Taxes), project director of Tamil Nadu State AIDS Control Society and as the District Magistrate and Collector of Dindigul and Kancheepuram districts in the Tamil Nadu government; and as Union Economic Affairs Secretary, Union Revenue Secretary, Union Fertilizers Secretary, Special Secretary in the Department of Economic Affairs of the Ministry of Finance and as a Joint Secretary in the Department of Expenditure of the Ministry of Finance in the Indian government.

Das also had a stint with Mahindra Industrial Park Ltd (Mahindra World City), on deputation to a private sector company under Rule 6(2)(ii) of the Indian Administrative Service (Cadre) Rules, 1954.

MAXIM

S

Abcdefghijklmnopqrstuvwxyz

LegaL PrecePts


Proprietarypl: -taries 1: something that is used, produced, or marketed under exclusive legal right of the inventor or maker; specif: a drug (as a patent medicine) that is protected by secrecy, patent, ...

Proprietorone who has legal right or exclusive title to something: owner; also: one (as a lessee) having an interest (as control or present use) less than absolute or exclusive right

Proprietorship1: the fact or state of being a proprietor 2: a business entity consisting of a single owner: sole proprietorship compare corporation, partnership

Propter Affectum[Medieval Latin] : because of partiality [challenge a juror propter affectum]

Propter Defectum[Medieval Latin] : because of a defect (as residence or relationship) [the disqualification of a juror propter defectum]

Proscribepro·scribed pro·scrib·ing [Latin proscribere to publish, proscribe, from pro- before + scribere to write] : to condemn or forbid as harmful or unlawful

Proscription1: the act of proscribing : the state of being proscribed 2 : an imposed restraint or restriction pro·scrip·tive [-skrip-tiv] adj pro·scrip·tive·ly adv

Prosecute-cuted -cuting [Latin prosecutus, past participle of prosequi to pursue] vt 1: to institute and carry forward legal action against for redress or esp. punishment of a crime

Prosecuting Attorneyan attorney who represents the government in instituting and proceeding with criminal actions: district attorney

Prosecution1: the act or process of prosecuting; esp: the institution and carrying on of a criminal action involving the process of seeking formal charges against a person and pursuing those charges to final...

Prosecutiveof or relating to prosecution [ function]

Prosecutor1: a person who institutes a prosecution (as by making an affidavit or complaint charging the defendant) 2: a government attorney who presents the state's case against the defendant in a criminal...

Prosecutorialof, relating to, or being a prosecutor or prosecution

Prospective1: relating to or effective in the future [a statute's effect] 2: likely to come about: expected to happen

[inability to perform the contract] 3: likely to be or become [a buyer]...

Prospectuspl: -tuses: a preliminary printed statement describing a business or other enterprise and distributed to prospective buyers, investors, or participants; specif: a ...

Prostitutea person who engages in sexual activity indiscriminately esp. for money compare panderer, pimp

Prostitutionthe act or practice of engaging in sexual activity indiscriminately esp. for money; also: the crime of engaging in such activity

Protect1: to shield from injury or harm [ing public health and safety] 2: to secure or preserve against encroachment, infringement, restriction, or violation : maintain the status or integrity of esp. ...

Protected Classa group of people intended by a legislature to benefit from the protection of a statute ;also : suspect class

Protection1: the act of protecting: the state of being protected [entitled to constitutional] 2 a: one that protects b: supervision or support of one having less power [of endangered species]

Protectiveof, relating to, or providing protectionProtective Custody

Protective Sweepa quick protective search limited in scope to a cursory visual inspection of places in which a person might hide

Protest1: a solemn declaration of opinion and usually of disagreement: as a: a solemn written declaration by a notary public or U.S. consul on behalf of the holder of an instrument (as a note) announcing...

Protestanta person challenging an action of an administrative agency

Mind-Boggling SolutionsCrossword Sudoku

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Mind-Boggling


For answers to the Crossword & Sudoku puzzle, turn to Legal Precepts section on page no. 76

Legal Crossword

SudokuNitaa Jaggi

ACROSS1. Inventor’s document (6)

4. Expert on bugs (10)

8. The allegation of new matter (7,8)

10. Famous lawyer (7)

12. Create striking sentences? (9)

14. Bring to a standstill (4)

16. ‘Cy ----doctrine’ or ‘as close as possible’ (4)

17. Be indebted (3)

19. Registered Investment Adviser (3)

21. Purist (8)

22. Jailers (8)

23. Sharer’s pronoun (3)

24. Value Added Tax (3)

25. Stigma (4)

26. ‘T’ in TCS (4)

29. You, formerly (4)

30. Abscond (4)

32. Children with no parents (7)

35. Unequal treatment of people (15)

37. Angrily deny in court (10)

38. Authored (6)

DOWN2. Leading law firm (3)

3. Vocation (5)

4. Heir’s document (4)

5. Political meeting (5)

6. Proprietary advantage (5,6)

7. Past convictions (6)

8. Identical document (4)

9. Entry points (8)

11. It’s served to the opposite party (6)

13. ------ Attack- cause of concern (6)

15. Cops, formally (6,5)

16. “On the rounds” van (6)

18. --------Property- claimed by a plaintiff (8)

20. Draw a suspect (6)

27. Follow a legal matter (6)

28. Concludes (4)

31. Irish nationalist (5)

33. Raffle reward (5)

34. Kind of child (4)

36. Persona— grata (3)

7 3 4 22 8 6 5

6 1 2 9 72 3 7 4

4 84 9 1 83 7 2 4 68 4 6 2

2 6 9 5

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