Insights
September 10, 2020

INITIATION OF INSOLVENCY PROCEEDINGS AGAINST PERSONAL GUARANTORS: INDIAN COURTS FREEZE ANIL AMBANI’S ASSETS

On November 15, 2019, the Indian government notified the commencement of Part III of the Insolvency and Bankruptcy Code, 2016 (IBC), which provides for the insolvency resolution process for individuals and partnership firms.  The relevant provisions in so far as they relate to personal guarantors of corporate debtors came into force on December 1, 2019.  Pursuant to this notification, creditors are now permitted to initiate insolvency proceedings against a personal guarantor of a corporate debtor if the guarantor fails to honour its obligations despite a demand being raised. 

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Insolvency and Restructuring Neerav Marchant
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September 2, 2020

YES BANK v. ZEE: A CURIOUS CASE OF COMFORT AND GUARANTEE

Introduction Letters of Comfort (LoC) have been issued by the promoters of various borrower companies to Indian banks, overseas branches of Indian banks and non-bank lenders. In many cases, these have been equated with guarantees. On August 19, 2020, the Bombay High Court dismissed an interim application by Yes Bank against Zee Entertainment Enterprise Limited…

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Banking and Finance
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August 20, 2020

THE POST-COVID PE AND VC INVESTMENT SCENARIO IN INDIA

COVID-19 is having an adverse effect on private equity and venture capital investments in India. As per industry reports and experts’ views, PE and VC investments in India may decline up to 60% in 2020 due to the pandemic. In 2019, PE and VC investment activities reached a record high at US$48 billion in India….

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Private Equity and Venture Capital
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July 23, 2020

TAXATION OF SECONDED EMPLOYEE SALARY REIMBURSEMENTS AND PERMANENT ESTABLISHMENT IMPACT

In the recent case of Yum Restaurants (Asia) Pte, the Delhi Income Tax Appellate Tribunal (Delhi Tribunal) has held that payments received by a Singapore company from an Indian group company towards salary reimbursement costs in the case of a seconded employee is not in the nature of “fees for technical services” and, therefore, not…

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Tax
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July 13, 2020

M&A IN STRESSED INDIAN COMPANIES – WILL THE SEBI AMENDMENTS HELP?

The SEBI has permitted stressed companies to undertake a preferential issue at a price, which is the average of the weekly high and low of the volume-weighted average price (‘VWAP’) of its equity shares during the preceding two (2) weeks. In order to be eligible to avail of the foregoing relaxation, a stressed company must…

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Corporate/M&A
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July 6, 2020

MEASURES TAKEN BY INDIA’S SECURITIES REGULATOR TO EASE CAPITAL RAISING BY LISTED COMPANIES

After the nationwide lockdown was imposed in the third week of March, India’s Securities and Exchange Board of India (the “SEBI”) has been quick-thinking in introducing a slew of relaxations for the securities market with a focus to lessen the burden of listed companies and market intermediaries. In this update, we analyze the key measures…

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Securities Law
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June 24, 2020

THE AMRAPALI FRAUD – INDIA’S FOREIGN INVESTMENT AND MONEY LAUNDERING LAWS SHOULD NOT BE TAKEN LIGHTLY BY INVESTORS

Foreign investment in India is regulated by the Ministry of Finance and the Reserve Bank of India (RBI), and foreign investors have a strict onus of complying with India’s Foreign Exchange Management Act, 1999 (FEMA), and its rules and regulations. Any breach of the FEMA rules and regulations can result in penalties being levied against…

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Foreign Investment Insolvency and Restructuring
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June 17, 2020

SUSPENSION OF INDIA’S INSOLVENCY AND BANKRUPTCY CODE – WILL IT ADD TO THE PROBLEM?

On June 5, 2020, the Indian government promulgated the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2020 (the “Ordinance”). The Ordinance has been promulgated as a part of the economic package announced by India’s Finance Minister last month. The Ordinance indefinitely bars the initiation of insolvency proceedings under the Insolvency and Bankruptcy Code, 2016 (the “Code”),…

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Insolvency and Restructuring
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June 9, 2020

M&A IN INDIA POST-LOCKDOWN – TRENDS AND ISSUES

Distress Currently, the one word that best describes the situation of many Indian companies and businesses is “distress”. The two-plus months of a fairly stringent lockdown in most major Indian metros, including Mumbai (which contributes 6% of India’s GDP), has badly impacted several businesses. The measured relaxation of the lockdown feels like the aftermath of…

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Corporate/M&A Covid-19
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June 1, 2020

THE AFTERMATH OF COVID-19 IN INDIA: EMPLOYMENT LAW HAS ASSUMED GREATER IMPORTANCE THAN EVER BEFORE

India is the fifth-largest economy in the world with a workforce of 400 million. Several companies across the world have wholly-owned subsidiaries in India, mainly in sectors like IT and IT-enabled services, financial services, consulting, insurance and healthcare. A large number of multinational companies depend on their Indian subsidiaries and group companies for back-office support….

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Covid-19 Employment Law
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