The Insolvency and Bankruptcy Code, 2016 (“IBC”) came at a time of great need for the Indian economy. It is argued that, at the time, Non-Performing Assets were on their way to crippling the Indian economy which would have had far-reaching implications on banks and the economy at large. However, ever since the IBC has come into the picture, far-reaching and substantial strides in the recovery and restructuring of dues have been made whether in the form of pre-admission settlements or the Corporate Insolvency Resolution Process (“CIRP”). Despite its successes, we have seen grave shortcoming under the IBC and the wake-up call with regard to this was seen in the…
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RBI’s Draft Enabling Framework for Regulatory Sandbox: A Step Forward in Innovation
Amidst much speculations in the FinTech sector, the Reserve Bank of India (“RBI”) released the Draft Enabling Framework for Regulatory Sandbox, 2019 (“Draft Framework”) on 18th April 2019 aimed at enhancing financial inclusion and innovation in the Indian financial sector, especially for FinTech start-ups. This article seeks to discuss various important clauses of the Draft Framework and examine them in light of the objectives sought to be achieved by it and thereafter, suggest some changes. [Mansi Mishra is a student of second year B.A. LL.B. (Hons.) at the National Law Institute University, Bhopal] About the Draft Framework The object behind the Draft Framework is to set up Regulatory Sandbox (“RS”)…
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Information Symmetry under the Insolvency and Bankruptcy Code, 2016
The modus operendi to achieve an optimum insolvency regime is to critically analyse the performance of the legislation on the basis of the effects it has on the overall business and credit market. Thus critiquing its efficiency is an important element of any codified law in a country. This need is even more imperative not only because of the number of applications under the Insolvency and Bankruptcy Code, 2016 (“Code”) but because of the increasing use of this new mechanism to achieve the enforcement of debt obligations and reorganization outside the formal process under the Code, as an arm twisting means, making it more onerous to investigate its effectiveness and efficiency.…
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Leniency Programme under the Competition Act: A Definitive Guide
The Competition Commission of India (“CCI”) is empowered, under Section 46 of the Competition Act, 2002, to grant lesser penalties to members of cartels where (i) they have made a full and true disclosure in respect of the alleged violations and (ii) this disclosure is sufficient to enable CCI to form a prima-facie opinion about the existence of a cartel or which helps to establish the contravention of the provisions of section 3 of the Act. 15 years after this provision was enacted along with the Competition Act, the first case under Section 46 was decided by CCI in 2017. This article seeks to set out the law behind the…
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Facebook’s T&C and the GDPR: A Case Study
Social media websites such as Facebook have not only increased manifold in the number of users and popularity but also have been regarded as important means of shaping public discourse making it one of the most sought after modes of advertising. These websites are beneficial for both vendors as well as consumers. Facebook, in order to become more efficient, has used several tools which have helped them provide more personalised information to its users. By enhancing its capacity to predict a person’s (data subject) likes, dislikes and preferences, Facebook has become overly appealing to vendors who can now rework and streamline their resources in identifying the target audience more accurately.…
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Rights of Employees and Workmen under IBC: Road to Recovery?
The Insolvency and Bankruptcy Code, 2016 (“Code”) has been enacted with an objective of consolidating and amending the laws relating to reorganisation and insolvency resolution of corporate persons, partnership firms and individuals in a time-bound manner. It aims at maximisation of value of assets of such corporate persons, partnership firms and individuals, promoting entrepreneurship, ensuring availability of credit and balancing the interests of all stakeholders. The author, in this articles, aims to cover the provisions related to the rights of employees under the Code to recover their unpaid wages and salaries from the Corporate Debtor and bring out a picture about how such provisions act as a boon for them. [Dulung Sengupta…
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Call for Articles: The CorpLexia Blog [Submissions on Rolling Basis]
About the Blog CorpLexia is a legal blog for the next generation of lawyers, professionals, academics and students focused on the realm of corporate, commercial, financial, insolvency, securities, arbitration and competition laws, who are energised by ambition and striving for perfection. Believing in the free discourse of knowledge, CorpLexia aims to break away from the hardwired practice of caging the very cutting edge of legal research and intellectual output in a close-ended journal, away from open and free access. We endeavour to put forth authoritative, inquisitive and well-researched publications that stand the test of our readers’ intellectual vigour. Theme Corporate, commercial, financial, insolvency, competition, securities, arbitration laws, etc. …
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SC Strikes Down RBI’s Feb 12 Insolvency Circular: Demystifying the Decision
A bench of the Hon’ble Supreme court of India comprising of Justices R. F. Nariman and Vineet Saran, in the case of Dharani Sugars and Chemicals Ltd. v. Union of India (“Dharani”) have invalidated the Reserve Bank of India’s (“RBI”) Circular titled ‘Resolution of Stressed Assets – Revised Framework’ (issued on 12.02.2018) (“Feb 12 Circular”) as being ultra vires the Banking Regulation Act, 1885 (“BR Act”) and the Reserve Bank of India Act, 1934 (“RBI Act”). This Circular had overhauled the Indian regime of stressed asset resolution and introduced the generic scheme of a resolution plan to be implemented within 180 days from the date of the default on the loan. Furthermore, where the…
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Successful Bidder, Failed Resolution: Analyzing the Lacuna in the Insolvency and Bankruptcy Code, 2016
The Insolvency and Bankruptcy Code, 2016 (“Code”) has arguably been one of the foremost developments in the Indian financial laws in recent times. While the Code has proven to be (or made to be) contentious in what seems to be almost every aspect of its substance and procedure, a new facet has been added to the realm of concerns under the new insolvency regime. In 2018, having reneged on its obligations under approved resolution plans for Amtek Auto Ltd and Adhunik Metaliks Ltd, Liberty house, the successful bidder or the supposed knight in shining armour for these insolvent firms has opened up the proverbial Pandora’s box of shortcomings and indecisions under…
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Section 15-J of the SEBI Act: SC Expands the AO’s Discretion in the Determination of Penalties
The Supreme Court of India in the Case of Adjudicating Officer, SEBI Vs. Bhavesh Pabari (“Bhavesh Pabari”)has given an expansive and harmonious interpretation to Section 15-J of the Securities and Exchange Board of India Act, 1992 (“SEBI Act”) holding that the factors enumerated under Section 15-J are not exhaustive but rather illustrative factors to be taken into account by the Adjudicating Officer (“AO”) while adjudging the quantum of penalty to be imposed under Section 15-I and that the AO may take note of other factors as well, in the same analysis. In Bhavesh Pabari, the Apex Court had also delved into the question of the conflict of application between Section 15-J and…
