Latest updates

Supreme Court's recent take on non-disclosure and misrepresentation
Tuli & Co
  • Insurance
  • India
  • 21 May 2019

The Supreme Court recently ruled in a case between Reliance Life Insurance and the wife of an insured party who had died of a heart attack. Reliance had repudiated the respondent's claim due to the suppression of material facts by the insured, who had failed to provide details of a second policy with another insurer. In its decision, the Supreme Court considered the nature of the disclosure made by the insured and the validity of the ground for repudiation of the claim.

Regulatory sandbox proposed for insurance sector
Tuli & Co
  • Insurance
  • India
  • 14 May 2019

The Insurance Regulatory and Development Authority recently issued the Report of the Committee on the Regulatory Sandbox in the Insurance Sector in India, which proposes to establish a sandbox environment in the insurance sector. According to the report, the sandbox will facilitate innovation in the Indian insurance sector and provide an ecosystem to foster the experimentation required to increase insurance penetration in the market and benefit policyholders. However, reservations remain.

Notable case law: private share placements, slump sales and transfer pricing
BDO LLP
  • Corporate Tax
  • India
  • 10 May 2019

This article looks at notable tax decisions from the Indian courts, including a Supreme Court decision concerning the receipt of share capital in case of private share placements. It also examines the Bombay High Court's decision regarding the sale of an entire unit as a going concern and a recent case involving transfer pricing adjustments.

Significant beneficial ownership – India's pivot towards disclosure
Cyril Amarchand Mangaldas
  • Private Client & Offshore Services
  • India
  • 09 May 2019

Following the recommendations of the Financial Action Task Force, India has introduced a statutory requirement for the identification and disclosure of significant beneficial owners, whether Indian or foreign, of every company incorporated in India. This is a landmark development which will lead to a significant push towards transparency.

India signs agreement with United States on exchange of country-by-country reports
BDO LLP
  • Corporate Tax
  • India
  • 03 May 2019

India and the United States recently signed an inter-governmental agreement on the exchange of country-by-country reports. As a result of this agreement, Indian constituent entities of international groups which are headquartered in the United States and have already filed country-by-country reports in that jurisdiction do not have to file such reports in India.

CCI grants first-ever 100% penalty reduction
Vaish Associates Advocates
  • Competition & Antitrust
  • India
  • 02 May 2019

The Competition Commission of India (CCI) recently awarded Panasonic Energy India Co Ltd the first-ever 100% penalty reduction in a leniency decision. In making its decision, the CCI observed that the investigation had been initiated based on information provided by Panasonic and that its cooperation had been essential for establishing a contravention of the Competition Act. Thus, the information provided by Panasonic was deemed to have added significant value to the investigation.

CCI issues third-ever leniency decision
Vaish Associates Advocates
  • Competition & Antitrust
  • India
  • 25 April 2019

In its third-ever leniency decision, the Competition Commission of India (CCI) granted a penalty reduction to four of the six leniency applicants. The allegations in the case concerned bid rigging in five tenders floated by the Pune Municipal Corporation in 2014 for the establishment of solid waste processing plants. The CCI found that all six of the opposing parties had participated in bid rigging or collusive bidding in contravention of the Competition Act.

Supreme Court rules on whether special allowances constitute basic wages for purposes of PF contributions
Shardul Amarchand Mangaldas & Co
  • Employment & Benefits
  • India
  • 24 April 2019

The Supreme Court recently examined whether certain components of an employee's overall salary are subject to provident fund (PF) contributions. As the Supreme Court has clarified that special allowances paid to employees must be included in the calculation of PF contributions, employers should review and analyse their current salary structures to determine any increase in PF liabilities.

Supreme Court clears air on determination of relevant market in Section 3 cases
Vaish Associates Advocates
  • Competition & Antitrust
  • India
  • 18 April 2019

The Supreme Court recently clarified that the determination of the relevant market is not a mandatory pre-condition for assessing an alleged violation of Section 3 of the Competition Act. In its application, the Competition Commission of India argued that the Supreme Court had previously given the impression that the relevant market must be determined in all cases concerning Section 3 of the act.

Enforcement of foreign awards: does violation of legal provision equate to contravention of fundamental policy?
Khaitan & Co
  • Arbitration & ADR
  • India
  • 18 April 2019

In 2013 the Supreme Court held that the enforcement of a foreign arbitral award can be refused only if it is contrary to, among other things, the 'fundamental policy of Indian law'. This article focuses on the Indian courts' interpretation of this term and looks at a common question that arises in relation to this area of law – namely, whether a foreign arbitral award which is a mere violation of an Indian legal provision qualifies as a contravention of the fundamental policy of Indian law.

Hedging loss is not international transaction
BDO LLP
  • Corporate Tax
  • India
  • 12 April 2019

In a recent case before the tax tribunal, a taxpayer gave an unsecured loan to its associated enterprises for which it had charged interest equal to LIBOR plus 250 basis points based on the rate at which it had borrowed funds from a foreign bank. The tax tribunal upheld the taxpayer's benchmarking and rejected the lower tax authority's contention that had the taxpayer advanced the loan to a third party, it would have charged a mark-up for its administrative expenses and the risk borne therein.

Supreme Court limits NCLAT's appellate jurisdiction
Vaish Associates Advocates
  • Competition & Antitrust
  • India
  • 11 April 2019

The Supreme Court recently set aside a National Company Law Tribunal order and restored the appeal which had been dismissed thereby. The appeal concerned a stay order which the Competition Commission of India had granted subject to the appellant paying a sum equal to 10% of the total penalty. In its landmark ruling, the court confirmed that the right to appeal envisioned by the Competition Act cannot be restricted by the requirement that a pre-deposit be paid.

Transfer pricing adjustments must be restricted to international transactions and made at transactional level
BDO LLP
  • Corporate Tax
  • India
  • 05 April 2019

The tax tribunal recently found that the lower tax authority had erred in making a transfer pricing adjustment at the entity level, rather than the transactional level. According to the tribunal, the lower tax authority had failed to understand that third-party transactions are in fact at arm's length and cannot be considered when calculating a transfer pricing adjustment.

CCI closes investigation into Kerala Cement Dealers' Association and Ramco
Vaish Associates Advocates
  • Competition & Antitrust
  • India
  • 04 April 2019

The Competition Commission of India (CCI) recently closed its investigation into the Kerala Cement Dealers' Association (KCDA) and Ramco Cements Ltd. The director general had initiated an investigation based on allegations that Ramco had been prevented from supplying cement after refusing to follow the KCDA's instructions to do so at an unfair price. However, the CCI held that the evidence collected by the director general was insufficient to prove a contravention of the Competition Act.

Tax exemption eligibility criteria for start-ups reduced
BDO LLP
  • Corporate Tax
  • India
  • 29 March 2019

In a bid to generate investment in start-ups and provide certainty regarding the so-called 'angel tax', the Ministry of Commerce and Industry recently issued another notification easing the criteria to avail of the exemption under the Income Tax Act. The notification will provide start-ups with a much-needed reprieve in terms of the increased threshold limits for paid-up share capital, allowing them to avail of the exemption more easily.

Delhi High Court upholds right to counsel during director general's investigation
Vaish Associates Advocates
  • Competition & Antitrust
  • India
  • 28 March 2019

The Division Bench of the Delhi High Court has upheld the right of a person summoned by the director general to be accompanied and represented by counsel. However, the Competition Commission of India has raised concerns that permitting the active participation of counsel during depositions may not be conducive to the public interest at large.

CCI launches investigation against ONGC for abuse of dominant position
Vaish Associates Advocates
  • Competition & Antitrust
  • India
  • 21 March 2019

The Competition Commission of India has launched an investigation under the Competition Act against Oil and Natural Gas Limited (ONGC) for abuse of its dominant position in the relevant market. The investigation stemmed from allegations made by the informant that ONGC had imposed one-sided and onerous terms in its charter hire agreements with suppliers of offshore support vehicles.

Moral rights: can authors waive their special rights?
Saikrishna & Associates
  • Intellectual Property
  • India
  • 18 March 2019

The Copyright Act specifically addresses authors' special rights, which comprise the right to claim authorship of a work and the right to prevent any distortion, modification or mutilation of a work which would be prejudicial to the author's reputation. While jurisprudence on moral rights is still relatively limited, a few foundational cases are emblematic of India's approach and the associated legal issues.

CCI approves Bayer's acquisition of Monsanto subject to structural modifications
Vaish Associates Advocates
  • Competition & Antitrust
  • India
  • 14 March 2019

The Competition Commission of India has approved Bayer Aktiengesellschaft's proposed acquisition of Monsanto Company, subject to certain remedies. For example, the combined entity must give the government access to Indian agro-climatic data free of charge and cannot directly or indirectly impose commercial dealings capable of causing exclusivity in the sales channel for the supply of agricultural products.

Arbitrability of consumer disputes: loophole in Booz Allen framework?
Khaitan & Co
  • Arbitration & ADR
  • India
  • 14 March 2019

The Supreme Court recently ruled that consumer disputes are incapable of being submitted to arbitration, placing them in the infamous category of 'non-arbitrable' subjects in India. However, the court also stated that where an elected consumer fails to file a consumer complaint, the parties are not barred from submitting the dispute to arbitration. This article analyses whether such a statement could have far-reaching implications for arbitrability as a ground for challenging an award.